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Saber v. Saber

California Court of Appeals, Second District, Third Division
Jul 25, 2008
No. B198506 (Cal. Ct. App. Jul. 25, 2008)

Opinion


SAM SABER, Plaintiff and Respondent, v. MARY ANN SABER, Defendant and Appellant. B198506 California Court of Appeal, Second District, Third Division July 25, 2008

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

APPEAL from a judgment of the Superior Court of Los Angeles County, Allan J. Goodman, Judge.

Mary Ann Saber, in pro. per.; Weston, Benshoof, Rochefort, Rubalcava & MacCuish, Michael D. Young and Casondra K. Ruga for Defendant and Appellant.

Kinkle, Rodiger and Spriggs, Allison R. Hilgers and Daniel S. Alderman for Plaintiff and Respondent.

OPINION

KITCHING, J.

Mary Anne Saber appeals a default judgment entered in favor of her brother, Sam Saber. The default judgment quieted title to two pieces of real property, one in Calabasas and another in Santa Monica, and awarded Sam monetary damages in the amount of $699,650. We conclude Sam’s failure to specify an amount of damages in the operative complaint precluded an award of money damages in his favor. (Code of Civil Procedure, § 580, subd. (a).) Further, the award to Sam of full title to the Santa Monica property exceeds the demand of the operative complaint in that Sam admitted Mary contributed to the acquisition of title. We therefore reverse the default judgment to the extent it awards money damages and full title to the Santa Monica property and remand for further proceedings.

We refer to the parties by their first names for convenience and clarity. No disrespect is intended.

Subsequent unspecified statutory references are to the Code of Civil Procedure.

FACTS AND PROCEDURAL BACKGROUND

1. Sam initiates litigation.

On July 5, 2005, Sam filed a verified complaint to quite title to two condominiums, one in Calabasas and the other in Santa Monica. The complaint alleged Sam purchased the condominiums, placed title in Mary’s name and Mary promised to put title in Sam’s name at his request. The complaint indicated Sam paid $76,893.26 for the Calabasas condominium on November 25, 1997, and $327,625 for the Santa Monica condominium on October 1, 2001. At the time of the purchases, Mary was employed by American Mortgage Capital (AMC), a company owned and operated by Sam. The complaint stated Mary had refused to put title in Sam’s name and requested damages in an amount to be determined at trial.

On September 30, 2005, Sam gave notice that Mary’s default had been entered.

On November 29, 2005, Sam filed a case summary in support of a request for entry of default judgment. In it, Sam indicated he is a real estate broker specializing in refinances. His company, AMC, employs 60 individuals. Mary worked at AMC as the bookkeeper. Mary took title to the condominiums so Sam could refinance the properties three times a year through AMC, each time netting $7,000 in commissions, without disclosing his financial information to the employees of AMC. In the case summary, Sam admitted that Mary “did pay $76,700 toward the original purchase price of the Santa Monica property.” Sam averred that Mary paid none of the expenses toward the Calabasas condominium while she lived there rent free. When Mary moved to Santa Monica, she paid the expenses on the Calabasas property but also collected rent from the tenant, resulting in a monthly net gain to Mary.

On December 13, 2005, the trial court denied the request to enter court judgment. The trial court noted the cause of action to quiet title was not well pleaded and failed to meet the requirements of section 761.020 in several respects. Further, live testimony is required to prove-up a quite title claim. (§ 764.010.)

Section 764.010 provides: “The court shall examine into and determine the plaintiff’s title against the claims of all the defendants. The court shall not enter judgment by default but shall in all cases require evidence of plaintiff’s title and hear such evidence as may be offered respecting the claims of any of the defendants, other than claims the validity of which is admitted by the plaintiff in the complaint. The court shall render judgment in accordance with the evidence and the law.”

2. Sam’s first amended complaint.

On December 30, 2005, Sam filed a verified first amended complaint (FAC) seeking to quite title to the two condominiums and alleging breach of contract and fraud. The allegations of the original complaint are repeated in the FAC, which requested damages in an amount to be determined by proof. The FAC included an allegation that Mary “paid $76,902.91 to invest in Santa Monica.” A proof of service indicates the FAC was served on Mary by personal service on March 7, 2006, at the office of Sam’s attorney. Sam filed and recorded a notice of pending action as to both properties.

On April 27, 2006, Sam filed a request for entry of default on the FAC.

On May 25, 2006, the trial court conducted a case management conference at which it entered a default as to Mary and set a default prove-up hearing. The May 25, 2006, minute order indicates: “Defendant is admonished that she should consider obtaining counsel and file a proper motion to set aside default.” The minute order further indicates the trial court did not require notice, thereby suggesting Mary was present in court at the time of the conference.

On June 1, 2006, Sam filed his case summary in support of request for entry of default by court judgment. This filing reiterated the factual claims Sam made in his previous case summary.

3. The default prove-up hearing.

On June 26, 2006, the trial court conducted the prove up hearing. Sam testified that in 1997 he purchased the Calabasas condominium where Mary and their mother, Irene Saber, were living because they said they would have to move if the property was not purchased. The price of the property was $77,000. When Sam’s attorney presented the trial court with a copy of a check in the amount of $75,000, the trial court indicated the copy of the check was not sufficient. Sam said he had the original check but it was not with him in court. Sam testified he put the property in Mary’s name, but he had an oral agreement with Mary that she would transfer title to the property to him upon his request. Sam put title to the property in Mary’s name so he could refinance the property three times a year through his company, each time netting $7,000 in commissions, without making his financial information known to the employees of his company. Sam testified the present value of the Calabasas condominium was between $450,000 and $500,000. In June of 2005, Mary refinanced the Calabasas condominium without his consent or approval, taking out a loan in the amount of $330,000.

Sam testified he purchased the Santa Monica condominium for $415,000, less his real estate commission or approximately $397,000. Sam deposited $327,000 into escrow from his business account. After the purchase, the Santa Monica condominium was refinanced in the amount of $175,000 and Sam received the proceeds of this loan. As with the Calabasas property, Sam repeatedly refinanced the $175,000 loan on the Santa Monica condominium and used the refinancing commissions to pay the expenses of the property. In June of 2005, Mary took out a loan on the Santa Monica property without Sam’s consent or approval in the amount of $360,000. Sam testified the present value of the Santa Monica property is $900,000.

At the conclusion of the hearing, the trial court directed Sam to file a memorandum of points and authorities in support of his request for default judgment. The trial court directed Sam to address whether the agreement with Mary was enforceable notwithstanding the statute of frauds and to explain why Sam’s repeated refinancing of the properties was not illegal.

4. Sam’s post-hearing memorandum of points and authorities.

Sam’s declaration in support of the memorandum averred the only restriction on repeated refinancing is the agreement with the lender. Sam would refinance at the highest interest rate, thereby earning the highest commission. Sam indicated there was nothing wrong or illegal about this procedure. Mary lived in the condominiums with their mother, Irene Saber. Sam treated both of them well, paid for their medical insurance, employed Mary at his brokerage firm even though she was difficult to deal with, bought them new cars, provided vacations and paid essentially all their expenses between 1996 and 2001. Sam attached copies of Mary’s W-2’s to his declaration to show that she was paid well, even though she had no prior experience in the mortgage business. Sam asserted he has had to fire Mary because she could not get along with the other employees of his company. Mary now runs her own mortgage business based on what she learned while working with Sam.

Sam averred he purchased the Calabasas condominium with a $75,000 check drawn on his AMC bank account. Mary signed the check because she was Sam’s bookkeeper at the time. Sam deposited an additional $1,893.26 to close the escrow. Sam paid $327,625 toward the purchase the Santa Monica property with a check drawn on an account owned by one of his companies, Old Patriot Holdings, Inc. (OPH). Again, Mary signed the check because she was Sam’s bookkeeper. Sam admitted Mary “did pay $83,875.00 towards the original purchase price of the Santa Monica property. Exhibit L contains true and correct copies of checks showing money drawn from [Mary] Saber’s personal bank accounts in this amount.” Other than this amount, Mary has paid nothing toward the expenses of either property. While Mary lived in Santa Monica, she paid the Calabasas expenses but earned net rental income on the property.

Sam next asserted that, in June of 2005, Mary took out a loan on the Calabasas property in the amount of $340,000 and a loan on the Santa Monica property in the amount of $359,650. Sam calculated that Mary netted $254,560 after she paid the existing loans and thus had funds to hire an attorney, yet she refuses to do so.

Sam asked that title be transferred to his name. Sam indicated he was willing to take the properties subject to the current liens, which would mean that Mary would earn a profit of approximately $255,000 consisting of the cash she had received from the loans she had placed on the properties. Sam preferred title to the properties but claimed “at the very least” he was entitled to a money judgment in the amount of the current appraised value of the properties ($1,550,000) minus the amount of the loans ($699,650) or $850,350.

With respect to the statute of frauds, Sam’s memorandum of points and authorities asserted this is a defense which must be raised by an adverse party. Mary was in default and has not attempted to defend the action, despite her knowledge of the default. Thus, Mary had waived the statute of frauds. Also, Mary would be estopped from asserting the statute of frauds on equitable theories of constructive trust, purchase money resulting trust or part performance of the agreement. Sam argued a constructive trust should be imposed to prevent unjust enrichment. (Martin v. Kehl (1983) 145 Cal.App.3d 228, 237.) Sam conceded an accounting might be necessary to determine what set-off, if any, Mary was entitled to for the expenses she paid toward Calabasas and the purchase price she contributed to Santa Monica.

Alternatively, Sam requested money damages on the causes of action for breach of contract and fraud. Sam requested, at minimum, the amount he paid toward the properties, which is $404,518.26 plus interest, but argued he was entitled to the current market value of the properties or $1,550,000.

Sam’s attorney filed a declaration in support of the memorandum that indicated counsel has spoken to Mary on several occasions in an attempt to settle this matter. In those conversations, Mary indicated she was concerned about the tax implications of transferring title to the properties to Sam. Counsel averred Mary has been aware of the lawsuit since its inception and “has told me on several occasions that she wants to ‘work something out,’ however something always comes up and she always has an excuse not to resolve the situation.” Before the prove up hearing, Mary told counsel she had been advised she would suffer no adverse tax consequences if a court ordered her to transfer title to Sam. Counsel asserted Mary “has appeared in court, but she has never expressed to me any disagreement with what [Sam] is seeking.”

5. The trial court enters default judgment in Sam’s favor.

On December 8, 2006, the trial court granted the default judgment and found Sam had “established the right to quiet title to the two properties at issue and for a monetary judgment with respect to liens and encumbrances placed on the real property without his consent or benefit.” On December 18, 2006, Sam filed a declaration indicating the amount of the unapproved liens on the property totaled $699,650. On December 19, 2006, the trial court entered a court judgment by default against Mary which transferred sole legal and beneficial title to both condominiums to Sam and awarded Sam damages in the amount of $699,650.

6. Mary’s motion to vacate the judgment.

On January 17, 2007, Mary appeared in court on an ex parte, pro. per. motion to vacate the judgment and set aside the default. Mary’s motion claimed: 1) the judgment was obtained through extrinsic fraud in that notice was not provided to her at 1322 2nd Street, No. 18, Santa Monica; 2) other individuals with a financial interest in the properties were not provided notice of the lawsuit; and, 3) Mary had a meritorious defense in that she has paid all expenses associated with the Calabasas property after November of 1997 and all expenses associated with the Santa Monica property after January of 2001.

The trial court set the matter for a hearing on February 7, 2007, and ordered Mary to give notice.

On January 26, 2007, Sam filed opposition to Mary’s motion. Sam argued Mary could not demonstrate extrinsic fraud because she had actual knowledge of the lawsuit and the default. In support of the opposition, Sam’s counsel declared Mary came to the office of Sam’s attorney to be served the FAC because she did not want a process server coming to her home. Mary has spoken to Sam’s counsel many times about the lawsuit and appeared in court on several occasions, including the default prove-up hearing in June of 2006. Mary has stated that she did not want to defend this lawsuit and preferred to have the court decide what should be done with the properties. With respect to the merits, Sam argued payment of the expenses related to the properties would not constitute grounds to invalidate the judgment. Rather, at most Mary would be entitled to an equitable set off.

On February 7, 2007, the trial court denied Mary’s motion with prejudice to any subsequent motion, however denominated, to set aside the judgment. The trial court found Mary had not given proper notice of the motion to vacate and she failed to state a basis for relief.

On March 5, 2007, Sam gave notice of entry of judgment by default on December 19, 2006.

On April 6, 2007, Mary filed a notice of appeal on behalf of herself and her mother, Irene Saber.

We previously granted Sam’s motion to dismiss Irene Saber from the appeal.

CONTENTIONS

Mary contends the default judgment is void because the argument, evidence and new legal theories presented by Sam after the unsuccessful default prove-up hearing constituted a de facto amendment of Sam’s FAC, which relieved Mary of her default and entitled her to be served anew and to file a new responsive pleading. Mary further contends the default judgment is void because it awarded Sam $699,650 in damages when the underlying FAC failed to specify any amount of damages and sought only damages “in an amount to be proven at trial” or “according to proof.” Lastly, Mary contends the default judgment is void because Sam failed to establish ownership of either condominium and the judgment was obtained as a result of extrinsic fraud.

Sam contends Mary’s appeal is not timely.

DISCUSSION

1. Mary’s appeal is timely.

Sam contends Mary’s appeal is untimely because her notice of appeal was filed on April 6, 2007, and thus was not within 60 days of notice of entry of judgment, which Sam asserts occurred on December 19, 2006. (Cal. Rules of Court, rule 8.104(a).) Sam concedes that where a party files a motion to vacate the judgment, the time within which to file a timely notice of appeal may be extended under rule 8.108(c). However, the time for filing a timely notice of appeal is extended under rule 8.108(c) only for 30 days after the clerk mails or a party serves an order denying the motion to vacate the judgment. Sam asserts he served notice of the trial court’s denial of Mary’s motion to vacate the judgment on February 7, 2007. Thus, the notice of appeal filed April 6, 2007, was not filed within the time contemplated by either Rule 8.104(a) or Rule 8.108(c). Sam notes this court lacks jurisdiction to address the issues presented in the appeal and concludes the appeal must be dismissed. (Van Beurden Ins. Services, Inc. v. Customized Worldwide Weather Ins. Agency, Inc. (1997) 15 Cal.4th 51, 56.)

Subsequent rule references are to the California Rules of Court.

Rule 8.108(c) provides: “If, within the time prescribed by rule 8.104 to appeal from the judgment, any party serves and files a valid notice of intention to move–or a valid motion–to vacate the judgment, the time to appeal from the judgment is extended for all parties until the earliest of: [¶] (1) 30 days after the superior court clerk mails, or a party serves, an order denying the motion or a notice of entry of that order; [¶] (2) 90 days after the first notice of intention to move–or motion–is filed; or [¶] (3) 180 days after entry of judgment.”

The flaw in Sam’s argument is that, although the trial court entered judgment in Sam’s favor on December 19, 2006, Sam did not give notice of entry of judgment until March 5, 2007. Thus, Mary had 60 days from the notice of entry of judgment within which to file a timely appeal. (Rule 8.104(a).) Mary filed her notice of appeal on April 6, 2007, which was within the time contemplated under Rule 8.104(a). Consequently, Mary’s appeal is timely.

We therefore address the merits of Mary’s contentions.

2. Mary is not entitled to relief from default.

Mary contends the default judgment must be set aside because Sam presented new factual allegations, evidence and legal theories at his default prove-up hearing and in the post-hearing memorandum of points and authorities that he had not presented in his FAC. Mary argues that without amending the FAC, Sam asserted for the first time in his memorandum that the oral agreement between himself and Mary could be enforced under a theory of constructive trust, resulting trust or part performance. Further, Sam claimed for the first time at the default prove-up that Mary took out loans on the properties without Sam’s consent and that she was unjustly enriched or she improperly converted thousands of dollars to her use because Sam was the equitable owner of the properties. The court ultimately awarded Sam damages of almost $700,000. Mary asserts these de facto amendments of the FAC relieved Mary of her default.

Mary’s relies on Jackson v. Bank of America (1986) 188 Cal.App.3d 375, 389-390 (Jackson), for the proposition that if the substance rather than the form of the complaint is amended after a default has been entered, the amendment opens the default and, unless the amended pleading is served on the defaulting defendant, no judgment can be entered on the default. However, In re Marriage of Andresen (1994) 28 Cal.App.4th 873, 884-886 (Andresen), holds that the Jackson case goes too far and is contrary to Supreme Court authority. The Andresen court noted the result in Jackson conflicts with the opinions of the California Supreme Court in Becker v. S.P.V. Construction Co. (1980) 27 Cal.3d 489, and In re Marriage of Lippel (1990) 51 Cal.3d 1160. Both of these cases indicated modification of the judgment, not opening of the default, is the correct remedy where a plaintiff’s proof at default exceeds the demands of the complaint. (See also, Electronic Funds Solutions, LLC v. Murphy (2005) 134 Cal.App.4th 1161, 1182; Ostling v. Loring (1994) 27 Cal.App.4th 1731, 1743-1747.)

Therefore, the correct result is not to open the default but to determine the extent to which the default judgment may be upheld based on the allegations of the FAC and the proof adduced by Sam at the prove-up hearing.

3. The Money Damages Awarded by the Trial Court Must Be Set Aside.

Turning first to the award of $699,650 in damages in Sam’s favor, Mary contends Sam is not entitled to recover money damages because the FAC sought only damages “in an amount to be proven at trial” or “according to proof.” Mary argues that, under section 580, subdivision (a), “The relief granted to the plaintiff, if there is no answer, cannot exceed that demanded in the complaint[.]” Mary concludes that, because the FAC sought damages “according to proof,” the trial court’s award of money damages to Sam exceeded the trial court’s jurisdiction.

It appears Mary’s point is well taken.

Greenup v. Rodman (1986)42 Cal.3d 822 (Greenup), noted section 580 aims “to ensure that a defendant who declines to contest an action does not thereby subject himself to open-ended liability. Reasoning that a default judgment that exceeds the demand would effectively deny a fair hearing to the defaulting party, the Courts of Appeal have consistently read the code to mean that a default judgment greater than the amount specifically demanded is void as beyond the court’s jurisdiction. [Citations.] [¶] We affirmed that strict construction of section 580 in Becker v. S.P.V. Construction Co. (1980) 27 Cal.3d 489 [165 Cal.Rptr. 825, 612 P.2d 915]. We held that the primary purpose of the section is to guarantee defaulting parties adequate notice of the maximum judgment that may be assessed against them. As we observed, ‘The notice requirement of section 580 was designed to insure fundamental fairness. Surely, this would be undermined if the door were opened to speculation, no matter how reasonable it might appear in a particular case, that a prayer for damages according to proof provided adequate notice of a defaulting defendant’s potential liability.’ (Id. at p. 494.) Since Becker, the Courts of Appeal have insisted that due process requires formal notice of potential liability; actual notice may not substitute for service of an amended complaint. [Citation.]” (Greenup, at p. 826.) Greenup concluded a default award must conform to the limitations specified in section 580. (Greenup, at pp. 829-830.)

Here, Sam requested damages “according to proof” but he failed to specify an amount of damages in the complaint. Consequently, under section 580, the judgment is void to the extent it awards damages in excess of the amount claimed in the complaint. (Levine v. Smith (2006) 145 Cal.App.4th 1131, 1137; Falahati v. Kondo (2005) 127 Cal.App.4th 823, 830-831; Janssen v. Luu (1997)57 Cal.App.4th 272, 279.)

In personal injury actions, the amount of the demand is provided to the defendant in a statement of damages rather than in the complaint. (§ 425.11.) Service of a statement of damages in an action to quiet title cannot satisfy the requirements of section 580, subdivision (a). (Electronic Funds Solutions v. Murphy, LLC, supra, 134 Cal.App.4th at pp. 1176-1177.)

At oral argument, Sam claimed the power of the trial court to do equity in a quiet title action includes the power to award money damages where the defendant has stripped real property of its equity, as Mary did in this case by encumbering the properties. (§ 760.040, subd. (c).) A similar argument expressly was rejected in Finney v. Gomez (2003) 111 Cal.App.4th 527, 537-538 (Finney). Finney held: “This [equitable] rationale simply does not apply to section 580, because, as explained above, the section is far from a simple procedural housekeeping rule which loses its force simply by virtue of a cause of action sounding in equity. Rather, the section is fundamental to the constitutionally required notice to a defendant deciding whether to answer a complaint or assume the potential exposure in not doing so.” (Finney, at p. 538.)

Section 760.040, subdivision (c) provides: “Nothing in this chapter limits any authority the court may have to grant such equitable relief as may be proper under the circumstances of the case.”

Consequently, the award of money damages in Sam’s favor must be set aside. (§ 580, subd. (a).) We therefore need not address whether the award of full title to both properties plus the gross amount of the unapproved loans constituted excess damages, given that Sam admitted in the post-hearing memorandum of points and authorities that Mary netted only approximately $255,000 from these loans.

We note that if Sam wishes to recover monetary damages from Mary, he will have to further amend the operative pleading to include a demand for a specific amount of damages. Such an amendment, if permitted, will have the effect of vacating Mary’s default and entitle her to demur, move to strike or answer the amended complaint. ( Falahati v. Kondo, supra, 127 Cal.App.4th at p. 831; Ostling v. Loring, supra, 27 Cal.App.4th at p. 1744.)

4. The award of full title to the Santa Monica condominium exceeds the demand of the FAC.

The trial court apparently relied on a theory of purchase money resulting trust in awarding Sam title to the properties. The law of resulting trusts is well settled: “To charge a resulting trust upon any specific property it must be shown that trust funds went into the purchase of the property [citation], and where two persons allegedly contribute money to the purchase of land, the title to which is taken in the name of one of them pursuant to an oral agreement, the resulting trust comes, not from the agreement, but from the facts shown as to the amount of purchase price advanced by each. [Citation.] . . . [O]ne who claims a resulting trust in the land must establish by clear, convincing and unambiguous testimony the precise amount or proportion of the consideration furnished by him as well as the amount for which the purchase was made in order that the court may determine the respective rights of the parties in the property purchased; otherwise the legal title will prevail. [Citations.]” (McQuin v. Rice (1948) 88 Cal.App.2d 914, 917-918.)

Here, the FAC contained all the elements of a resulting trust in that it alleged Sam contributed substantial sums to the acquisition of title to both properties and Sam and Mary agreed Mary would hold title for Sam’s benefit. However, Sam admitted in the FAC that Mary “paid $76,902.91 to invest in Santa Monica.” Further, Sam’s post-hearing memorandum of points and authorities admitted that Mary “did pay $83,875.00 towards the original purchase price of the Santa Monica property.” Notwithstanding these admissions, the trial court failed to consider Mary’s contribution toward the Santa Monica property. Consequently, the matter must be remanded to permit the trial court to determine whether and the extent to which Mary may be entitled to a pro rata share of title to the Santa Monica property.

5. Mary’s remaining attacks upon the default judgment lack merit.

a. The sufficiency of Sam’s evidence.

Mary contends Sam failed to meet the heightened evidentiary burden in quiet title actions. (Yeung v. Soos (2004) 119 Cal.App.4th 576, 580-581 (Yeung); § 764.010.) Yeung noted that a plaintiff seeking to quite title at a default prove up hearing must present all evidence the plaintiff would have presented at trial. “ ‘[A] declaration or other summary procedure will not be permitted. Live witnesses must testify, and complete authentication of the underlying real property records is essential.’ ” (Yeung, at p. 581.)

Mary argues Sam attempted to establish title to the properties without authenticating the records relied upon. Mary notes Sam failed to introduce the originals of the checks he claimed he used to purchase the condominiums and the trial court specifically stated at the prove-up hearing it would not rely on copies. Sam offered no documentary evidence to support his conclusory testimony that the properties were purchased with AMC funds and he was the owner of AMC. Sam also failed to trace the source of the funds used to purchase the properties. Sam failed to demonstrate the AMC funds were not owed or loaned to Mary to purchase the properties or that Sam or the companies intended to purchase the property for Sam’s account.

Mary further notes Sam’s declaration failed to incorporate by reference the exhibits attached to it. Further, Sam failed to authenticate the exhibits referred to in the declaration in that he did not set forth a legal foundation for each document. Sam also claimed he paid all the expenses associated with the properties, yet he failed to provide any evidence of these payments. Although the trial court ordered Sam to address the statute of frauds, he failed to demonstrate how the oral contract was enforceable as against a claim the statute required a writing.

Mary’s claims in this regard are not persuasive. Although Sam submitted a copy of the AMC check in the amount of $75,000 at the prove-up hearing, he submitted the original as an exhibit to his memorandum of points and authorities. Moreover, the record demonstrates the trial court was aware of the evidentiary issues raised by Mary in that it required Sam to file an amended complaint that complied with the requirements of section 764.010 and it required live testimony as required by section 764.040. Contrary to Mary’s assertion, Sam’s testimony traced the funds used to purchase both properties to accounts Sam testified he owned. In addition, Sam submitted as exhibits to his memorandum of points and authorities numerous additional documents that supported his testimony at the prove-up hearing. The trial court properly could accept Sam’s testimony on these points. Sufficient evidence need not be gathered from multiple sources; the testimony of a single witness may be sufficient. (Kearl v. Board of Medical Quality Assurance (1986) 189 Cal.App.3d 1040, 1052.)

With respect to Mary’s assertion she has a meritorious defense to Sam’s FAC based on the statute of frauds, we note the trial court addressed the statute of frauds sua sponte, apparently in an effort to prevent injustice to Mary. Further, Sam’s memorandum of points and authorities correctly pointed out the statute of frauds is a defense that Mary had not asserted. Sam further noted that, had Mary raised the statute of frauds, she would have been estopped from asserting it on equitable grounds. Thus, Sam did not raise these theories in order to prevail on his claim against Mary. Rather, Sam merely responded to the trial court’s inquiry. It appears the trial court agreed with Sam’s assessment of the issue in that it ultimately granted judgment in his favor.

b. Mary fails to demonstrate extrinsic fraud.

Mary contends the default judgment should be set aside based on extrinsic fraud. She asserts service was improper because it uniformly omitted her Unit No. from her address, she was lulled into taking no action by Sam’s continuing settlement overtures, and she has a meritorious defense within the meaning of Rappleyea v. Campbell (1994) 8 Cal.4th 975, 982, because Sam cannot overcome the statute of frauds. Mary further argues Sam’s counsel engaged in what amounted to extrinsic fraud in that counsel told Mary the matter would be resolved and she did not have to hire an attorney. Mary argues she is entitled to set aside the judgment based on this conduct.

Extrinsic fraud occurs when a party is deprived of the opportunity to present a claim or defense because an opponent has kept the party in ignorance or has fraudulently prevented the party from participating in the proceedings. (In re Marriage of Stevenot (1984) 154 Cal.App.3d 1051, 1068.) Mary’s assertion of extrinsic fraud in this case is contradicted by the evidence that showed Mary was aware of the proceedings from the outset. Indeed, the trial court urged Mary to obtain counsel to set aside the default at a case management conference on May 25, 2006. Additionally, it appears Mary was present in court at the time of the default prove-up hearing. Mary raised the claim that she fraudulently was prevented from participating in the proceedings in her motion for new trial and the trial court rejected it.

A ruling on a motion to vacate will only be disturbed on appeal where there is a clear showing of abuse of discretion and a manifest miscarriage of justice. (In re Marriage of Eben-King & King (2000) 80 Cal.App.4th 92, 118.) Mary has failed to make that showing here.

With respect to Mary’s proof of service argument, Mary concedes she may have had actual notice of some of the documents mailed to the incomplete address. However, she insists on statutory notice. (§§ 587, 1013, subd. (a).) “[S]ervice of papers to an incorrect address is not acceptable notice.” (Moghaddan v. Bone (2006) 142 Cal.App.4th 283, 288 (Moghaddan).)

In Moghaddan, the case cited by Mary, notice of an appealable order was mailed to an address that omitted the zip code. Moghaddan concluded the notice was insufficient absent proof of actual receipt. Thus, the time within which to file a timely notice of appeal from the order was 180 days, rather than 60 days. (Rule 8.104(a).)

Here, rather than raising the rule requiring strict statutory service as to a specific document as was the case in Moghaddan, Mary seeks to apply this rule uniformly to every document served on her throughout the pendency of the litigation. However, the record contains evidence from which we may conclude Mary received mail at the incomplete address. This evidence includes a certified mail receipt signed by Mary following mailing of the Notice of Pendency of Action to the incomplete address. Moreover, Mary’s pro. per. motion to vacate the judgment complained that Sam should have served her at an address that was completely different than the address of the Santa Monica condominium. Mary did not complain the address Sam used was incomplete.

Consequently, Mary’s improper service argument does not assist her cause.

DISPOSITION

The default judgment with respect to the Calabasas property is affirmed; the award of money damages is reversed; with respect to the Santa Monica property, the matter is remanded for further proceedings consistent with the views expressed in this opinion. Each side shall bear their own costs on appeal.

We concur: CROSKEY, Acting P. J., ALDRICH, J.

Rule 8.104(a) provides: “Unless a statute or rule 8.108 provides otherwise, a notice of appeal must be filed on or before the earliest of: [¶] (1) 60 days after the superior court clerk mails the party filing the notice of appeal a document entitled ‘Notice of Entry’ of judgment or a file-stamped copy of the judgment, showing the date either was mailed; [¶] (2) 60 days after the party filing the notice of appeal serves or is served by a party with a document entitled ‘Notice of Entry’ of judgment or a file-stamped copy of the judgment, accompanied by proof of service; or [¶] (3) 180 days after entry of judgment.”


Summaries of

Saber v. Saber

California Court of Appeals, Second District, Third Division
Jul 25, 2008
No. B198506 (Cal. Ct. App. Jul. 25, 2008)
Case details for

Saber v. Saber

Case Details

Full title:SAM SABER, Plaintiff and Respondent, v. MARY ANN SABER, Defendant and…

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

Date published: Jul 25, 2008

Citations

No. B198506 (Cal. Ct. App. Jul. 25, 2008)