Case Name: MSB Homes, LLC v. Quality Loan Service Corporation et al.

Case No.: 17CV316373

I. Background

This action arises from a dispute relating to the rescission of a trustee’s deed upon sale following a foreclosure of real property. The subject property was owned by defendant Helen Carranza (“Carranza”) and the foreclosure sale was conducted by defendant Quality Loan Service Corporation (“QLS”). Plaintiffs MSB Homes LLC and JN Home Investment, LLC (collectively “Plaintiffs”) purchased the subject property at the sale and now seek declaratory relief and to quiet title against QLS and Carranza, individually and in her capacity as trustee of the Moorpark Avenue Trust (“Moorpark Trust”) (collectively “Defendants”). Plaintiffs’ complaint is based on their allegations QLS improperly rescinded the sale after discovering Carranza’s husband listed the property on his bankruptcy petition thereby insulating the property from foreclosure through the automatic stay. (Complaint, ¶¶ 15-21.)

Plaintiffs filed a complaint against Defendants on September 27, 2017. On October 5, 2017, Plaintiffs filed proofs of service of summons (“POSS”) reflecting they served Carranza, individually and in her capacity as trustee of the Moorpark Trust, with a copy of the summons and complaint on October 2, 2017.

Currently before the Court is Carranza’s motion to quash service of the summons and complaint for improper service. Plaintiffs oppose the motion.

II. Motion to Quash Service of Summons (and Complaint)

Proper service of the summons and complaint in compliance with the Code of Civil Procedure is a prerequisite to acquiring personal jurisdiction over a defendant. (Renoir v. Redstar Corp. (2004) 123 Cal.App.4th 1145, 1150.) When the service of summons is defective, a defendant may file a motion to quash service of summons on the basis the court lacks personal jurisdiction over him or her. (Code Civ. Proc., § 418.10, subd. (a)(1).) Once a defendant files a motion to quash, the burden is on the plaintiff to establish the facts of jurisdiction by a preponderance of the evidence demonstrating the validity of the service. (Boliah v. Super. Ct. (1999) 74 Cal.App.4th 984, 991; Evangelize China Fellowship, Inc. v. Evangelize China Fellowship, Hong Kong (1983) 146 Cal.App.3d 440, 444.)

Carranza argues service of the summons and complaint was improper because Plaintiffs did not personally serve her or properly effect substitute service. In opposition, Plaintiffs contend they properly served Carranza through substitute service when, after making reasonably diligent attempts at personal delivery, they left a copy of the summons and complaint with a competent member of her household at her dwelling and also mailed a copy to that location. Plaintiffs also argue service was proper because, after being advised by Carranza to leave a copy of the summons and complaint with an employee at the house during their second attempt at personal service, they left a copy of these documents with a “person authorized by [her] to receive service of process” during their third attempt to personally serve her. (See Code Civ. Proc. § 415.90.)

Code of Civil Procedure section 415.10 (“Section 415.10”) states that a summons may be served by personal delivery of a copy of the summons and complaint to the person to be served. However, where personal service of a summons cannot be accomplished despite reasonably diligent efforts, Code of Civil Procedure section 415.20 (“Section 415.20”), subdivision (b) authorizes substitute service in lieu of personal delivery. (Ellard v. Conway (2001) 94 Cal.App.4th 540, 545.) Valid substitute service may be accomplished by leaving a copy of the summons and complaint at the defendant’s dwelling house in the presence of a competent member of the household and thereafter mailing a copy to that same place. (Code Civ. Proc., § 415.20, subd. (b).)

On October 5, 2017, Plaintiffs filed a proof of service of summons (“POSS”) reflecting Carranza was served, individually and in her capacity as trustee of the Moorpark Trust, by substitute service on October 2, 2017. The declaration of diligence attached to the POSS and executed by their process server reflects that Plaintiffs previously attempted to personally serve Carranza at her dwelling at 4339 Moorpark Avenue, San Jose, California on two separate occasions. The first time, the process server was informed Carranza was not home. The second time, Carranza was not home but he spoke with an individual who called her and was advised she was aware of the litigation and requested that he leave the documents with an employee at the house. Despite this fact, he decided to make one more attempt to personally serve Carranza before effecting substitute service. The POSS indicates that on October 2, 2017 Plaintiffs’ process server tried to personally serve Carranza again and, after failing to do so, left a copy of the summons and complaint with the house manager Josie Ramos. The POSS also includes a declaration of mailing indicating he mailed a copy of the summons and complaint to that address that same day. In addition to the POSS itself, Plaintiffs also file a declaration by their process server attesting to the same facts.

The POSS demonstrates Plaintiffs served Carranza in compliance with subdivision (b) of Section 415.20. The “filing of a [code-compliant] proof of service creates a rebuttable presumption that the service was proper.” (Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th at 1441-42.) Consequently, service was presumptively proper and Carranza bears the burden of rebutting this presumption.

Carranza does not present any evidence to rebut this presumption. Though she baldly asserts she was not properly served through substitute service, she does not substantiate this argument. In support of her motion, she relies solely on a declaration by her attorney indicating he spoke with her and she told him she “was not personally served with the Summons and Complaint.” (Lapham Decl., ¶ 4.) This is insufficient. In addition to the fact that this declaration clearly constitutes hearsay, as stated, personal service is not the only statutorily authorized method of service. The Code of Civil Procedure specifically permits substitute service on an individual after reasonably diligent attempts at personal service have failed. (Code Civ. Proc., § 415.20, subd. (b).)

Carranza also asserts that service was improper because the summons did not state the date on which it was personally delivered to her, which she purports they were required to do under Section 415.10. (Mtn. at p. 7:17-22.) Section 415.10 governs service of a summons and complaint by personal delivery to the person to be served. Carranza’s argument is therefore misplaced because Section 415.10 applies to personal and not substitute service of a summons, which is what was effected on Carranza here. Moreover, even if this statute did apply, it clearly states that service of a summons is nonetheless valid and effective even if it does not list the date personal delivery was accomplished.

Finally, Carranza contends service was improper because she did not receive a copy of the summons indicating she was personally served. Her position here appears to be based on a presumption that she was entitled to personal service of the summons. However, the record here reflects she was validly served through substitute service. Carranza presents no evidence to the contrary and cites no legal authority for the proposition that service is defective unless a defendant receives a copy of the summons indicating personal service was accomplished.

Thus, the preponderance of the evidence establishes Carranza was properly served by substitute service in accordance with Section 415.20, subdivision (b) and her assertion this Court lacks personal jurisdiction based on improper service lacks merit. The motion to quash service of summons is therefore DENIED.