From Casetext: Smarter Legal Research

Jackson v. National Interstate Ins. Co.

California Court of Appeals, Second District, First Division
Sep 26, 2008
No. B201110 (Cal. Ct. App. Sep. 26, 2008)

Opinion


ELLSWORTH JACKSON et al., Plaintiffs and Appellants, v. NATIONAL INTERSTATE INSURANCE COMPANY, Defendant and Respondent. B201110 California Court of Appeal, Second District, First Division September 26, 2008

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

APPEAL from a judgment of the Superior Court of Los Angeles County No. BC359446, Conrad Richard Aragon, Judge.

Mintz & Werner, Marshall G. Mintz and Pamela Jo Bille for Plaintiffs and Appellants.

Foley & Lardner, Eileen R. Ridley, Jason M. Julian and Tung Khuu for Defendant and Respondent.

MALLANO, P. J.

Plaintiffs Ellsworth Jackson and Scooter Jackson, Inc., doing business as Jackson Limousine Service, a California corporation (Jackson), appeal from the judgment entered following an order granting the motion of defendant National Interstate Insurance Company (National) for judgment on the pleadings. Jackson contends that the trial court improperly relied on extrinsic evidence in granting the motion and abused its discretion in denying Jackson’s request for leave to amend. We affirm.

BACKGROUND

Jackson operates a limousine service. In February 2000, Jackson purchased a liability insurance policy from National through insurance brokers. Later that year, one of Jackson’s vehicles was involved in an accident and the injured party filed suit against Jackson (the “personal injury” action). National provided a defense and settled the case, doing so under a reservation of rights on the ground that the number of vehicles in Jackson’s fleet had been understated significantly in Jackson’s insurance application.

Following the settlement, National sued Jackson and the insurance brokers for breach of contract, fraud, and other causes of action, seeking to recover the monies National had expended in defending and settling the personal injury action. (This lawsuit will be referred to in this opinion as the “underlying” or “original” action.) Jackson filed an answer and a cross-complaint against the insurance brokers but later failed to make required appearances and respond to discovery, and his answer was stricken. In 2004, National took Jackson’s default in the underlying action and secured a default judgment against him.

In September 2006, Jackson filed a complaint against National, which is the subject of this appeal. The complaint sought equitable relief from the default judgment against Jackson in the underlying action.

Jackson’s complaint set forth the above chronology of events. Jackson further alleged that in July 2003, while the underlying action was pending, Jackson’s attorney, Robert Belshaw, resigned from the California State Bar. (Jackson later learned that disciplinary action was then pending against Belshaw.) Belshaw did not inform Jackson that he had resigned from the bar and “continually represented to Jackson that he was defending him and his company” and “‘had everything under control.’” In addition, Belshaw instructed Jackson “to forward to him any documents that Jackson received in connection with the Original Action.” Jackson never received notice that Belshaw had resigned from the bar, that the court in the underlying action had ordered Jackson to retain new counsel, that Jackson’s deposition had been scheduled, that dismissal had been sought when Jackson failed to appear at his deposition, and that Jackson’s default had been taken as a result of his failure to appear at the deposition.

Jackson’s complaint also alleged that Jackson did not learn of the default in the underlying action until November 2005, when Jackson attempted to refinance real property that he owned. Upon learning of the default, Jackson diligently took steps to seek relief. In addition, Jackson alleged he “had, and still [has], a meritorious defense to the Original Action, as follows: the other named defendants in the Original Action (the brokers through which Jackson procured the National insurance policy at issue in the Original Action) were liable to Jackson for damages awarded in the Original Action by reason of equitable indemnity and proportionate liability for the losses alleged by National in the Original Action. [Jackson] seek[s] leave to reinstate [his] Answer and Cross-Complaint previously on file in the Original Action.”

National answered Jackson’s complaint, following which National filed a motion for judgment on the pleadings. In the motion, National asserted that Attorney Belshaw advised National in August 2003 that he had resigned from the State Bar, thus leaving Jackson to defend himself in the underlying action without counsel. National also requested judicial notice of various documents in the court file of the underlying action. These documents showed, among other things, as follows:

In August 2003, as part of a notice extending a mediation date at Jackson’s request, Jackson was further “ordered to retain counsel as soon as possible.” The extension notice was served by mail on Jackson’s business address on West Boulevard in Los Angeles. In December 2003, in a motion to compel Jackson to attend his deposition, counsel for National declared that he had left at least 10 telephone messages for Jackson and had faxed and mailed letters to Jackson seeking to arrange a time for the deposition, but had not received any response. Counsel had also been unsuccessful in attempting to serve Jackson with a deposition subpoena. An accompanying order shortening time for the motion to compel deposition authorized “substituted personal service at [Jackson’s] corporate office.” A January 2004 notice of ruling granting the motion to compel Jackson’s deposition, which again ordered Jackson to retain new counsel, was again served on Jackson’s business address. In May 2004, notice was served that Jackson’s answer had been stricken, in June Jackson’s default was taken, and in July default judgment was entered. National continued to serve all notices and other court documents on Jackson’s West Boulevard business address.

National’s motion for judgment on the pleadings also sought judicial notice from the superior court file in the underlying action of a February 2004 request for dismissal, with prejudice, of an indemnity cross-complaint that Jackson had filed in the underlying action against the insurance brokers. In the upper left-hand corner, the request indicated that it was being filed by Ellsworth Jackson at the same West Boulevard address on which National had served Jackson by mail. The request was signed by Ellsworth Jackson as “Attorney (or party without attorney).”

Jackson’s cross-complaint against the brokers has not been included in the record on appeal.

National’s motion further sought judicial notice of a February 2004 judgment in the underlying action dismissing the insurance broker defendants on their motion for summary judgment. The judgment of dismissal recited, among other things, that the brokers had not made any misrepresentation of fact in procuring insurance coverage for Jackson.

In a declaration in support of National’s motion for judgment on the pleadings, counsel for National attached printouts from the California Secretary of State showing Jackson’s business address to be the one on West Boulevard at which service by mail was made.

National argued that Jackson’s complaint in conjunction with facts subject to judicial notice from the court file in the underlying action demonstrated that Jackson was not entitled to equitable relief because he had not presented a satisfactory explanation for failing to appear in the underlying action, shown that he had a meritorious case, or diligently sought relief after discovering the default.

In opposition, Jackson relied on the allegations in his complaint that Attorney Belshaw continued to state he had everything under control and that Jackson should forward any documents to him. Jackson argued that based on these allegations, service of documents on him by mail did not establish that he had notice of the contents of those documents. Jackson further sought leave to amend if the court were inclined to grant National’s motion.

Jackson’s opposition also addressed the in propria persona dismissal of his indemnity cross-complaint against the insurance brokers in the underlying action as follows: “In or around February 2004, a motion for summary judgment by the Insurance Brokers was granted in the Underlying Action. [Fn. omitted.] Shockingly, shortly thereafter, the Insurance Brokers and their attorney met with Jackson and advised him that Jackson, along with the Insurance Brokers, had been dismissed from the case. Counsel for the Insurance Brokers then instructed Jackson to sign a request for dismissal of Jackson’s cross-complaint against the Insurance Brokers with prejudice which they prepared and then filed ‘on Jackson’s behalf’ in pro per . . ., thereby permanently forfeiting Jackson’s legitimate claim for indemnity against the Insurance Brokers.”

The trial court, stating that it had taken judicial notice of the entire file in the underlying action, granted National’s motion for judgment on the pleadings. Judgment was filed on June 6, 2007. Jackson filed a timely notice of appeal.

DISCUSSION

“Review of an order granting a motion for judgment on the pleadings is governed by the same standard applicable to reviewing an order sustaining a general demurrer. This court will examine only the face of the pleadings, together with matters subject to judicial notice, to determine whether such facts are sufficient to constitute a cause of action. A defendant is entitled to a judgment on the pleadings when it appears from the face of the complaint (or on those matters judicially noticed) that the complaint is barred as a matter of law. [Citation.] We review the pleadings de novo to determine whether the trial court erred in granting the motion. [Citation.]” (California Water Impact Network v. Newhall County Water Dist. (2008) 161 Cal.App.4th 1464, 1476; see Angelucci v. Century Supper Club (2007) 41 Cal.4th 160, 166; Gerawan Farming, Inc. v. Lyons (2000) 24 Cal.4th 468, 515–516.)

“[W]hile courts are free to take judicial notice of the existence of each document in a court file, including the truth of results reached, they may not take judicial notice of the truth of hearsay statements in decisions and court files. [Citation.]” (Lockley v. Law Office of Cantrell, Green, Pekich, Cruz & McCort (2001) 91 Cal.App.4th 875, 882.) “The underlying theory of judicial notice is that the matter being judicially noticed is a law or fact that is not reasonably subject to dispute. [Citations.]” (Ibid.)

A party seeking to set aside a default judgment on equitable grounds must provide a satisfactory excuse for not presenting a defense in the original action, demonstrate that it has a meritorious case, and show diligence in seeking to set aside the default once it has been discovered. (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 981–982; Stiles v. Wallis (1983) 147 Cal.App.3d 1143, 1147–1148.)

Jackson first argues that he is not chargeable with knowledge of the contents of the numerous envelopes sent to his business address because, as alleged in his complaint for equitable relief, he did not know his attorney had resigned from the bar. In addition, the attorney “continually represented to Jackson that he was defending him and his company” and “‘had everything under control,’” and the attorney instructed Jackson “to forward to him any documents that Jackson received in connection with the Original Action.”

We must accept as true this fact as alleged in Jackson’s complaint. (Angelucci v. Century Supper Club, supra, 41 Cal.4th at p. 166.) Accordingly, we agree with Jackson that he has pleaded a “satisfactory excuse” for his ignorance.

But moving to the second requirement for equitable relief, we conclude that judgment on the pleadings was proper because Jackson cannot show that he has a meritorious case.

Jackson has made no attempt to demonstrate that he had a defense against National in the underlying action. Rather, Jackson’s sole assertion of merit is based on his position that he is entitled to indemnity from his codefendants in the underlying action, that is, the insurance brokers who sold the liability policy to him. But National is the only defendant named by Jackson in his complaint for equitable relief under review here, and Jackson has not provided any authority that would permit equitable relief based on having a meritorious claim vis-à-vis a nonparty.

We further note that, based on judicial notice of documents filed in the underlying action, the insurance brokers, as cross-defendants to Jackson’s indemnity cross-complaint, were voluntarily dismissed with prejudice by Jackson himself. Jackson’s complaint for equitable relief does not allege facts that would explain this dismissal. In his written argument in opposition to National’s motion for judgment on the pleadings, Jackson asserts that counsel for the insurance brokers “instructed” him to file the dismissal. But no purpose would be served by granting Jackson leave to amend to allege this scenario in an amended complaint because whatever claim to indemnity Jackson might have against the insurance brokers is not a part of the action under review in this appeal.

Based on the foregoing, we conclude National’s motion for judgment on the pleadings was properly granted.

DISPOSITION

The judgment is affirmed.

We concur: ROTHSCHILD, J., HASTINGS, J.

Retired Associate Justice of the Court of Appeal, Second Appellate District, Division Four, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.


Summaries of

Jackson v. National Interstate Ins. Co.

California Court of Appeals, Second District, First Division
Sep 26, 2008
No. B201110 (Cal. Ct. App. Sep. 26, 2008)
Case details for

Jackson v. National Interstate Ins. Co.

Case Details

Full title:ELLSWORTH JACKSON et al., Plaintiffs and Appellants, v. NATIONAL…

Court:California Court of Appeals, Second District, First Division

Date published: Sep 26, 2008

Citations

No. B201110 (Cal. Ct. App. Sep. 26, 2008)