Filed 11/15/19 Clare v. White CA1/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION THREE

SIMONE CLARE,

Plaintiff and Appellant,

v.

ADAM J. WHITE et al.,

Defendants and Respondents.

A153228

(Solano County

Super. Ct. No. FCS047333)

Plaintiff Simone Clare (Clare) appeals from the trial court’s order granting defendant Bank of New York Mellon’s (the Bank) motion to set aside a default judgment. Clare contends the order must be reversed because she properly served the Bank’s agent for service, the Bank received actual notice of her lawsuit, and the Bank’s motion was untimely. We reject her contentions and affirm the order.

FACTUAL AND PROCEDURAL BACKGROUND

On January 7, 2016, Clare, then in propria persona, filed a complaint against the Bank and an individual named Adam J. White seeking to quiet title her real property on the grounds that the Bank lacked the authority to accept an assignment of the deed of trust and that a quitclaim deed granting White an interest in the property was recorded in error. On September 2, 2016, Clare filed a proof of service stating that, on July 13, she had the complaint and summons mailed to the Bank’s agent of service, Corporation Trust Company in Delaware (CTC-Delaware) at “CORPORATION TRUST CENTER 1209 ORANGE ST, WILMINGTON, DE 19081.” Clare submitted a return receipt signed by an Amy McLaren on July 18. As detailed below, the Bank claims Clare was promptly notified she had served the wrong agent and that the complaint and summons could not be forwarded to the Bank.

On September 14, 2016, Clare obtained a default against the Bank and served the entry of default on the Bank by first-class mail, addressed to the Bank at its location at “225 Liberty Street New York, NY, 10281” (the New York address). At a November 18 default prove-up hearing, the trial court entered judgment in favor of Clare, canceled the assignment of the deed of trust, and deemed title quieted to Clare as to the Bank. The same day, Clare served the default judgment by first-class mail addressed to the Bank at the New York address. On December 9, the judgment was amended to correct an error, and Clare served the amended judgment by priority mail to the Bank at the New York address on April 11, 2017.

On November 15, 2017, the Bank filed a motion to set aside the default and default judgment. The Bank accused Clare of “concoct[ing] a devious plan to obtain a default judgment” after failing to pay her mortgage for years, “accumulating a loan balance of almost $1,000,000,” and filing a “baseless” lawsuit in an attempt to “keep the loan proceeds and have a home free and clear of any liens.” The Bank’s Vice President and Legal Case Manager Cheryl Santucci declared the Bank did not receive any documents or information notifying it of the lawsuit until Clare’s attorney sent a fax to the Bank on June 22, 2017 stating Clare had obtained a default judgment. Santucci declared that “[a]s reflected in the records of the California Secretary of State,” the proper agent for service for the Bank is Corporation Trust Company in Los Angeles (CTC-Los Angeles) at 818 W. 7th Street, Suite 930, Los Angeles, CA 90017. She attached a printout from the California Secretary of State listing CTC-Los Angeles as the designated agent for service for the Bank.

Santucci further declared that she searched for but found no evidence that CTC-Los Angeles or CTC-Delaware ever notified the Bank of Clare’s lawsuit. She searched the database into which her paralegals scan all legal materials received at the Bank’s principal place of business in New York, but did not find anything relating to Clare’s lawsuit. If she had any notice of the lawsuit, she and her team would have ensured the correct servicer received the documents so the Bank’s interests could be properly represented, and to avoid adverse consequences such as a default judgment. “In no event, would I or my team members discard or otherwise ignore legal papers sent to [the Bank] at 225 Liberty Street, New York, New York.” “[I]t is my firm belief that no mail pertaining to this case, this property address or this borrower was received at [the Bank’s] address of 225 Liberty Street, New York, New York from the date the complaint was filed on July 6, 2016 to June 22, 2017 when the above-mentioned fax was received.” In addition, the Bank notes that the address to which Clare purportedly mailed the entry of default, default judgment, and amended judgment is incorrect; the zip code Clare used is 10281, while the correct zip code is 10286.

Brian Hickman, “Representation Services Advisor” for CTC-Los Angeles, declared that he searched an “enterprise wide database for recording and processing documents” to determine whether any CTC entity had received documents relating to Clare’s lawsuit. He discovered that CTC-Delaware rejected documents Clare mailed to CTC-Delaware as “ ‘CT Not Agent’ ” and notified Clare in a July 19 letter that it was not the proper agent for service for the Bank. The letter stated: “After checking our records and the records of the State of DE, it has been determined that The Corporation Trust Company is not the registered agent for an entity by the name of THE BANK OF NEW YORK MELLON. [¶] CT was unable to forward.”

Clare opposed the Bank’s motion to set aside the default and default judgment and argued she properly served the Bank or had substantially complied with service of process and the Bank received actual notice of the lawsuit. She explained that she first searched for the Bank’s agent for service on the New York Secretary of State website because the Bank’s principal place of business is in New York. There, she found an entity called “THE BANK OF NEW YORK MELLON CORPORATION,” which did not have a listed agent for service and whose jurisdiction was listed as Delaware. Clare therefore went to the Delaware Secretary of State website and found that the agent for service for “THE BANK OF NEW YORK MELLON CORPORATION” was CTC-Delaware. Clare “called the Delaware Secretary of State office and confirmed the accuracy of [her] search results.” She denied receiving the July 19 letter from CTC-Delaware rejecting service of process. Clare also argued the Bank’s motion was untimely because it was filed on November 15, 2017, more than six months after “the very latest date of service” of April 11, 2017—the date she served the amended judgment directly to the Bank at the New York address.

In reply, the Bank asserted Clare attempted service on the wrong entity—“ ‘The Bank of New York Mellon Corporation,’ ” which is the parent corporation for the defendant “The Bank of New York.” The Bank requested judicial notice of The Bank of New York Mellon Corporation’s annual report to the Securities and Exchange Commission listing the Bank as one of its subsidiaries. “Accordingly, the two entities are completely separate legal entities from one another.” The Bank asserted Clare also failed to comply with California’s service statutes, which requires her to serve an authorized person on behalf of the corporation. Finally, the Bank argued its motion was timely.

Clare submitted a “sur-reply” asserting she served the correct entity because the New York Secretary of State website has information suggesting the Bank and the “Bank of New York Mellon Corporation” are the same entity. She argued in the alternative that it is immaterial that the two are separate entities because she provided actual notice of the lawsuit to the Bank by mailing the judgment and amended judgment to its principal place of business in New York.

The trial court granted the Bank’s motion on the grounds that service was deficient and there was no actual notice to the Bank until June 22, 2017 because Clare served CTC-Delaware instead of CTC-Los Angeles and did not address the mail to—or show actual receipt by—any authorized individual at the Bank. The court also found the Bank’s motion was timely, stating there was insufficient evidence from which it could find the Bank had notice of the action before June 2017.

DISCUSSION

Clare contends the trial court’s order setting aside the default judgment must be reversed because she properly served the Bank’s agent for service, the Bank received actual notice of her lawsuit, and the Bank’s motion was untimely. We reject her contention.

There are a number of ways to serve process on an out-of-state corporation doing business in California. One method is by service on the corporation’s designated agent for service of process. (Code of Civ. Proc. §416.10, subd. (a); see also Corp. Code, § 2105, subd. (a)(5) [a foreign corporation must designate an agent for service of process with the California Secretary of State in order to conduct business in California].) Another is to serve one of a number of designated individuals, such as the president or chief executive officer of a corporation, who are authorized by statute to receive service on behalf of a corporation. (§ 416.10, subd. (b).) Section 415.40 allows a plaintiff to serve an out-of-state defendant by mailing the complaint and summons by first-class mail, return receipt requested.

“Substantial compliance,” as opposed to “strict compliance,” with the statutes relating to service of process “is sufficient” where a defendant has received actual notice of the complaint and summons. (Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th 1426, 1436–1437.) For example, if a person authorized by statute to accept service actually receives the complaint and summons, service can be deemed adequate even if the plaintiff failed to address the mail to an authorized person. (Ibid.)

A party who “has not actually been served with summons” has several avenues of relief from a default judgment that a plaintiff obtains against it. (Trackman v. Kenney (2010) 187 Cal.App.4th 175, 180.) Under section 473.5 subdivision (a), “[w]hen service of a summons has not resulted in actual notice to a party in time to defend the action and a default or default judgment has been entered,” the party may move to “set aside the default or default judgment and for leave to defend the action.” “The notice of motion shall be served and filed within a reasonable time, but in no event exceeding the earlier of: (i) two years after entry of a default judgment against him or her; or (ii) 180 days after service on him or her of a written notice that the default or default judgment has been entered.” (§ 473.5, subd. (a).) “Upon a finding by the court that the motion was made within the period permitted by subdivision (a) and that [the moving party’s] lack of actual notice in time to defend the action was not caused by [the party’s] avoidance of service or inexcusable neglect, it may set aside the default or default judgment on whatever terms as may be just and allow the party to defend the action.” (§ 473.5, subd. (c).)

“A motion to set aside a default judgment is addressed to the sound discretion of the trial court, and, in the absence of a clear showing of abuse of discretion where the trial court grants the motion, the appellate court will not disturb the order. It is the policy of the law to favor, wherever possible, a hearing on the merits. . . .” (Weitz v. Yankosky (1966) 63 Cal.2d 849, 854.)

Here, the Bank provided ample evidence in support of its motion to set aside the default judgment. Its legal case manager declared under penalty of perjury that the Bank did not receive any documents or information notifying it of the action until June 22, 2017. Both she and a CTC-Los Angeles representative declared—and presented evidence to show—that the proper agent for service for the Bank is CTC-Los Angeles, not CTC-Delaware. The Bank explained that the entity Clare found on the New York and Delaware Secretary of State websites—“Bank of New York Mellon Corporation”—is the Bank’s parent corporation, and that the two entities are therefore “completely separate legal entities from one another.” Further, the record contained a letter CTC-Delaware sent to Clare immediately upon receiving her complaint and summons explaining to her that she had attempted service on the wrong entity. Although Clare claimed she never received this letter, the trial court could have reasonably found that the letter, along with other evidence presented by the Bank, supported the Bank’s position that CTC-Delaware was not the proper agent for service for the Bank.

Clare asserts that even if CTC-Delaware was not authorized to accept service on behalf of the Bank, the Bank had sufficient notice of the action because she mailed the entry of default, default judgment, and amended judgment to the Bank’s principal place of business in New York. The trial court, however, could have reasonably found these documents did not provide actual notice to the Bank because they were mailed to an address containing the wrong zip code and/or because the court found credible the Bank’s legal case manager’s declaration that the Bank never received these documents. (Christian Research Institute v. Alnor (2008) 165 Cal.App.4th 1315, 1319 [“We may not reweigh the trial court’s implicit credibility determination”].)

Finally, Clare argues the Bank’s motion was untimely. As noted, party may file a motion to set aside a default judgment under section 473.5 subdivision (a) “within a reasonable time, but in no event exceeding the earlier of: (i) two years after entry of a default judgment against him or her; or (ii) 180 days after service on him or her of a written notice that the default or default judgment has been entered.” (§ 473.5, subd. (a).) Here, the Bank filed its motion on November 15, 2017—less than two years after the default judgment was entered, and less than 180 days after it received notice of the default judgment on June 22, 2017. The trial court properly found the Bank’s motion was timely on the basis that there was insufficient evidence from which it could find the Bank had notice of the action before June 22, 2017.

DISPOSITION

The order setting aside the default judgment is affirmed. Respondent Bank of New York Mellon shall recover its costs on appeal.

_________________________

Petrou, J.

WE CONCUR:

_________________________

Siggins, P.J.

_________________________

Fujisaki, J.

A153228/Clare v. The Bank of New York Mellon et al.