Case Name: Choice Properties, Inc., et al. v. UPL Enterprises, LLC, et al.

Case No.: 17CV319421

Motion to Quash Service of Summons or, in the alternative, to Set Aside the Default and for Leave to Defend the Action

Factual and Procedural Background

On or about January 1, 2015, plaintiff Choice Properties, Inc. (“CPI”) and UPL Enterprises, LLC (“UPL”) entered into an oral agreement to purchase real property in Texas. (Complaint, ¶BC-1.) Plaintiff CPI contributed $45,932.10 for the purchase of the property with the understanding that defendant UPL would flip the property and plaintiff CPI would be repaid with interest. (Id.) Defendant UPL sold the property and did not repay plaintiff CPI. (Id.)

On November 20, 2017, plaintiffs CPI and Andrew Lai (“Lai”) filed a Judicial Council form complaint against defendants UPL, Matt P. Jacobsen, and Ermina A. Jacobsen asserting causes of action for:

(1) Breach of Contract
(2) Common Counts

On March 7, 2018, at plaintiffs’ request, the clerk of court entered default against defendant Matt P. Jacobsen (“Jacobsen”).

On April 16, 2018, defendant Jacobsen filed the motion now before the court entitled, “Motion to Quash Service of Summons or, in the alternative, to Set Aside the Default and for Leave to Defend the Action.”

I. Defendant alternative motion to set aside the default and for leave to defend the action is DENIED.

As noted above, plaintiffs obtained entry of default against defendant Jacobsen on March 7, 2018. “Entry of defendant’s default instantaneously cuts off its right to appear in the action. The defendant is ‘out of court.’ It has no right to participate in the proceedings until either (a) its default is set aside (in which event, it may respond to the complaint), or (b) a default judgment is entered (in which event, it may appeal).” (Weil & Brown et al., CAL. PRAC. GUIDE: CIV. PRO. BEFORE TRIAL (The Rutter Group 2017) ¶5:6, p. 5-2 citing Devlin v. Kearny Mesa AMC/Jeep/Renault, Inc. (1984) 155 Cal.App.3d 381, 385 – 386; see also People v. One 1986 Toyota Pickup (1995) 31 Cal.App.4th 254, 259.) “Entry of default ousts the court of jurisdiction to consider any motion other than a motion for relief from default.” (Id. at ¶5:7, p. 5-3 citing W.A. Rose Co. v. Municipal Court (1959) 176 Cal.App.2d 67.) Consequently, the court is without jurisdiction to consider defendant Jacobsen’s motion to quash service of summons.

In the alternative, defendant Jacobsen asks the court to set aside the entry of default and for leave to defend the action pursuant to Code of Civil Procedure section 473.5 which states:

(a) When 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 against him or her in the action, he or she may serve and file a notice of motion 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.
(b) A notice of motion to set aside a default or default judgment and for leave to defend the action shall designate as the time for making the motion a date prescribed by subdivision (b) of Section 1005, and it shall be accompanied by an affidavit showing under oath that the party’s lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect. The party shall serve and file with the notice a copy of the answer, motion, or other pleading proposed to be filed in the action.
(c) Upon a finding by the court that the motion was made within the period permitted by subdivision (a) and that his or her lack of actual notice in time to defend the action was not caused by his or her 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.

Although defendant indicates that, “A copy of Defendant’s proposed pleading is filed contemporaneously herewith,” no such proposed pleading actually accompanied the filing of the instant motion nor was any proposed pleading separately filed. As indicated above, “The party shall serve and file with the notice a copy of the answer, motion, or other pleading proposed to be filed in the action.” (Code Civ. Proc., §473.5, subd. (b).)

Moreover, a motion to set aside default pursuant to Code of Civil Procedure section 473.5 must be based upon evidence that the defendant’s “lack of actual notice in time to defend the action was not caused by his or her avoidance of service or inexcusable neglect.” (Code Civ. Proc., §473.5, subd. (c); see also Tunis v. Barrow (1986) 184 Cal.App.3d 1069, 1077–1078—“A defendant seeking vacation of a default judgment entered against him must further show that his lack of actual notice in time to defend the action was not caused by his inexcusable neglect or avoidance of service.” See also Anastos v. Lee (2004) 118 Cal.App.4th 1314, 1319—“A party seeking relief under section 473.5 must provide an affidavit showing under oath that his or her lack of actual notice in time to defend was not caused by inexcusable neglect or avoidance of service.”) Defendant Jacobsen failed to present any admissible evidence in support of his motion. Defendant Jacobsen refers to an “accompanying Declaration of Josh Jacobsen,” but no such declaration actually accompanied the filing of the instant motion nor was any declaration separately filed.

Accordingly, defendant Jacobsen’s alternative motion to set aside the default and for leave to defend the action is DENIED.