Rodriguez v. Nam Min Cho

• Decision Date: 07 May 2015
• Docket Number: B256985
• Court: California Court of Appeals Court of Appeals
• Parties: Dulce RODRIGUEZ, Plaintiff and Respondent, v. NAM MIN CHO, Defendant and Appellant.

236 Cal.App.4th 742

187 Cal.Rptr.3d 227

Dulce RODRIGUEZ, Plaintiff and Respondent

v.NAM MIN CHO, Defendant and Appellant.

B256985

Court of Appeal, Second District, Division 8, California.

Filed May 7, 2015

Law Office of Chad Biggins and Chad Biggins, Los Angeles, for Defendant and Appellant.

Brown & Lipinsky, Daren H. Lipinsky, Aaron Ray Boyd, Chino Hills, and Bryan L. McNally, Claremont, for Plaintiff and Respondent.

Opinion

FLIER, J.

Nam Min Cho appeals from an order denying his motion to set aside the default judgment in this action. Cho raises two main contentions, one relating to purportedly improper or fraudulent service of the summons and complaint, and the second relating to the amount of damages awarded in the default judgment. We find the first contention lacks merit but the second does not. We hold the default judgment is void because it exceeded the amount of damages stated in the complaint. Accordingly, we reverse and remand with directions.

FACTS AND PROCEDURE

1. Allegations of Complaint

Rodriguez filed a complaint on July 11, 2011, against defendants Cho and Reliable Building Maintenance (Reliable), alleging Cho did business as Reliable. The complaint alleged defendants employed Rodriguez as a “housekeeper” at the Los Angeles County courthouse in Pomona from September 2005 to November 2010. Rodriguez's husband also worked for defendants at the same location. When she finished her shift, she would stay and assist her husband with his cleaning. Defendants knew of her overtime work and did not object, and they did not pay her overtime.

In 2009, Rodriguez filed a claim with the Division of Labor Standards Enforcement (DLSE) seeking unpaid overtime wages. Maintenance Cooperation Trust Fund, a statewide watchdog organization that works to abolish illegal and unfair business practices in the janitorial industry, assisted her with the DLSE claim. She presented letters from witnesses in support of her claimed overtime hours. The deputy labor commissioner assigned to her case would not accept such letters, but wanted sworn affidavits or live testimony. The DLSE dismissed her claim. In July 2009, the Maintenance Cooperation Trust Fund sent defendants a letter stating the dismissal of Rodriguez's claim did not change the fact that her filing was a protected action under California law, and the law prohibited retaliating against her for the filing.

Rodriguez's coworker also filed a claim against defendants for unpaid overtime with the Maintenance Cooperation Trust Fund's assistance. In November 2010, Rodriguez's manager informed her that because she had filed a claim with the DLSE, and because she had inspired her coworker to likewise file a claim, defendants were terminating her effective November 18, 2010. Rodriguez alleged defendants' conduct caused her pain and suffering, extreme and severe mental anguish, and emotional distress, as well as a loss of earnings and other benefits and job opportunities.

Rodriguez exhausted her administrative remedies by sending letters via certified mail to the Labor and Workforce Development Agency, Cho, and Reliable, alleging violations of the Labor Code by defendants. More than 33 days elapsed, and Rodriguez did not receive notice from the Labor and Workforce Development Agency that it intended to investigate her claims.

The complaint alleged causes of action for retaliation under three different Labor Code sections (Lab.Code, §§ 98.6, 232, subd. (c), 1102.5, subd. (b) ), violations of the Labor Code Private Attorneys General Act of 2004 (PAGA) (Lab.Code, § 2698 et. seq. ), and wrongful termination in violation of public policy.

The prayer for relief requested general, special, compensatory, and punitive damages in an amount to be proved at trial, a civil penalty in the amount of $10,000 (Lab.Code, § 1102.5, subd. (f) ), civil penalties under PAGA, and reasonable attorney fees and costs.

2. Default Judgment

In August 2011, Rodriguez filed proofs of service of summons on Reliable and Cho. The proofs showed that she served each with the complaint and a statement of damages, among other things. The sworn declaration of the registered process server showed he served Reliable on July 28, 2011, at 4:37 p.m., by personally serving the papers on Hang Bock Lee, Reliable's agent for service of process, at 3700 Wilshire Boulevard in Los Angeles.

The second sworn declaration of the same process server showed he served Cho on August 1, 2011, through substituted service on Kimmy Hanzaki, office manager, at 3200 Wilshire Boulevard in Los Angeles. The process server also mailed the papers through first class mail to the same location. The process server's due diligence declaration stated he had received the papers on July 27, 2011, and had been unable to effect personal service on Cho. He had attempted service on Cho at 3200 Wilshire Boulevard, his business address, three times (July 27 at 5:19 p.m., Aug. 1 at 8:00 a.m., and Aug. 1 at 3:33 p.m.). Each time, Cho was not in the office. Cho's residential address was not available.

The statement of damages served with the complaint disclosed that Rodriguez was seeking $1 million in general damages for emotional distress; $50,000 in special damages for lost earnings; $150,000 in special damages for loss of future earning capacity; and punitive damages in the amount of $2 million.

After Reliable and Cho did not respond to the complaint, the court entered the default of Reliable on September 13, 2011, and the default of Cho on September 20, 2011. Rodriguez served defendants with the request for entry of default by first class mail at the same addresses at which she served the complaint.

Rodriguez's prove-up in support of default judgment included, among other things, her and her counsel's sworn declarations attesting to the facts alleged in the complaint, the statement of damages, and the documents demonstrating proof of service described above. In addition, her prove-up documents showed she sent defendants a prelawsuit letter via certified mail at the 3200 Wilshire Boulevard address where she served Cho. The letter warned defendants that she would be filing this action and included the allegations of her forthcoming complaint. As for damages, her prove-up documents requested $23,680 in backpay with 10 percent prejudgment interest on that amount (or $2,368); $250,000 in general damages; $300 in civil penalties under PAGA; a $10,000 civil penalty against Reliable only under Labor Code section 1102.5 ; reasonable attorney fees; and $565 in costs.

On December 16, 2011, the court entered a default judgment for Rodriguez based on her written declaration under Code of Civil Procedure section 585, subdivision (d).¹ The judgment was against Reliable and “Cho dba ‘Reliable Building Maintenance Company,’ ” for a total of $129,673.48. This total consisted of $123,680 in damages; $2,368 in prejudgment interest at the rate of 10 percent;² $3,060.48 in attorney fees; and $565 in costs.

3. Motion to Set Aside Default Judgment

Over two years later, in April 2014, Cho filed a motion to set aside the default judgment. Cho's motion argued the default judgment was void because the amount of damages was excessive; Rodriguez did not demand an amount of damages in the complaint, and a default judgment may award only what the plaintiff demanded in the complaint. Although Rodriguez served a statement of damages, Cho argued this was irrelevant because a statement of damages applies only in personal injury and wrongful death actions, and this was not such. Further, Cho argued the declaration of the process server did not pass “the smell test,” and he never received notice of the action until recently. Cho's declaration in support of the motion stated that he never received the summons and complaint, and the proofs of service were therefore untrue on their face. He also averred that, had he known of the action, he would have responded to and successfully defended against the action, as he had done with “several frivolous actions” Rodriguez had previously filed against Reliable. Cho stated Rodriguez had done nothing to enforce the default judgment, and he only found out about it on March 31, 2014, when an escrow company discovered the abstract of judgment recorded against Cho's property on or about January 3, 2012.

Cho filed a supplemental declaration stating he had been diligently searching for Hanzaki, the office manager on whom the process server effected substitute service, but he had been unable to locate her. He also submitted a declaration of Lee, Reliable's agent for service of process. Lee declared he did not recall where he was on July 28, 2011, when the process server indicated he served Lee. Lee stated his calendar indicates he was out of the office in Fullerton, California at the time. He further stated he did not receive the summons and complaint, and if he had, he would have given the papers to Cho.

The trial court denied Cho's motion to set aside the default judgment in a considered 15–page minute order issued in May 2014. The court held Cho had not rebutted the presumption of valid service established by the declaration of the registered process server. As such, he failed to prove extrinsic fraud sufficient to set aside the default judgment. Moreover, the default judgment did not award excessive damages. Rodriguez was not required to state the amount of damages in the complaint and could properly use the separate statement of damages for this.

Cho filed a timely notice of appeal. In June 2014, Rodriguez filed an acknowledgment of satisfaction of judgment declaring Cho had satisfied the judgment in full.

DISCUSSION

The court may set aside a void default judgment at any time under section 473, subdivision (d). In addition, the court has inherent equitable power to set aside a default judgment at any time for extrinsic fraud or mistake. ( Sporn v. Home Depot USA, Inc. (2005) 126 Cal.App.4th 1294, 1300, 24 Cal.Rptr.3d 780.) Cho argues both that the default judgment is void because it...