Opinion
E031622.
7-22-2003
WILLIAM HARVEY CARON, Plaintiff and Appellant, v. ZURICH AMERICAN INSURANCE COMPANY, Defendant and Respondent.
Richard M. Hawkins for Plaintiff and Appellant. Sedgwick, Detert, Moran & Arnold, Frederick D. Baker, Katherine Demgen and Kirk C. Jenkins for Defendant and Respondent.
Plaintiff Caron appeals the trial courts denial of his Code of Civil Procedure section 473 motion to set aside an alleged default judgment.
Unless otherwise indicated, all further statutory references are to the Code of Civil Procedure.
BACKGROUND
In addition to facts in our record, we take judicial notice of the facts stated in our prior unpublished opinion in Hemphill v. Zurich-American Insurance Company (E029725; filed August 15, 2002).
On July 27, 1995, plaintiff Caron was a passenger in a car driven by Tony Hemphill off-road, on property owned by Hull Farms in Blythe. Mr. Hemphill drove the car negligently. It overturned and Mr. Caron was thrown out, injuring his spine and rendering him a quadriplegic. (E029725.) Mr. Caron sued Mr. Hemphill and obtained a default judgment of $ 10,275,000. (CT 61, 651; E029725.)
Mr. Hemphill then sued Zurich American, alleging that he was covered under a liability policy Zurich American had issued to Hull Farms because a personal liability endorsement to the policy defined any person using a vehicle on Hull Farmss property with the consent of the insured as an additional insured. (CT 141-142; E029725.) The trial court granted Zurich Americans summary judgment motion on grounds that consent was lacking. We affirmed on the ground "that, even assuming Hemphill was an additional insured, the policy did not cover bodily injury arising out of the use of a motor vehicle operated by an insured. Because there was no potential for coverage, Zurich had no duty to defend." (E029725.)
After obtaining the default judgment against Mr. Hemphill, and while the Hemphill litigation was pending, Mr. Caron filed this suit against Zurich American. He alleged that he was a judgment creditor of Mr. Hemphill, that Mr. Hemphill was an additional insured under the Hull Farms policy, and that he was therefore entitled to judgment pursuant to Insurance Code section 11580.2, subdivision (b)(2).
The complaint was incorrect. The proper section is Insurance Code section 11580, subdivision (b)(2). (Eigner v. Worthington (1997) 57 Cal.App.4th 188, 194, fn. 4.)
On July 13, 2001, the trial court granted Zurich Americans motion for summary judgment. Mr. Caron did not file opposition to the summary judgment motion and was not represented at the hearing on the motion. The judgment was signed on July 27, 2001, and notice of entry of judgment was given on August 2, 2001. No notice of appeal was filed.
Since no appeal was filed, and the motion to set aside the summary judgment was filed after the time for filing an appeal expired, we cannot review the merits of the trial courts decision granting Zurich Americans summary judgment motion. (English v. IKON Business Solutions, Inc. (2001) 94 Cal.App.4th 130, 135-136.) Accordingly, we do not reach Mr. Carons contention that the order granting summary judgment was void for lack of sufficient notice.
THE MOTION TO SET ASIDE THE SUMMARY JUDGMENT
On January 29, 2002, Mr. Caron filed a motion under section 473 to set aside a "default judgment," i.e., the judgment of July 27, 2001. The motion was based on the contention that his failure to oppose the summary judgment motion was due to the excusable neglect of his counsel, Richard Hawkins, because Mr. Hawkins was hospitalized when the summary judgment motion was heard on July 13, 2001, and he was unable to represent clients.
In support of this contention, Mr. Hawkins submitted a declaration which states: "After filing suit in this matter against defendant Zurich, I became ill and had to be hospitalized for several cancer surgeries and following said surgeries was disabled for many months, and I am now [January 28, 2002] just beginning to get back to where I can work again and practice law[.] [P] On or about the middle of April, 2001 while I was disabled and in the hospital my wife, who is my secretary, referred out most of my cases to other counsel, as I was unable to handle the cases anymore. This case . . . was referred out to other counsel . . . . Unbeknownst to me, when any papers would come in, my wife would forward them to the counsel we thought was handling this matter, and I was not personally aware what was going on. . . . It was only after I was advised that a hearing would be held on this summary judgment motion by Zurich about two to three days before the day it was set for hearing. [sic] When I learned that the counsel I had referred the case to was not going to handle the case my wife called defense counsel . . . to ask if he would be willing to put the matter over until I could obtain the papers back from the other counsel and file [responding] opposition to his motion. [He] refused to do this and I tried to prepare and did prepare some papers the day or two before the court hearing and I was unable to appear and my wife went to court in an attempt to file the papers on the day of the hearing but was not permitted to do so." In a later section of the declaration, Mr. Hawkins states: "I do not feel that the client should suffer this default due to my negligence and inadvertence in not making sure that the referred counsel was handling the matter as my office assumed at all times that they would be responding to defendants motion."
In response, defense counsel Amand Mines filed a declaration stating that his secretary called the office of plaintiffs counsel to inquire about the status of the opposition. The declaration then states: "In response, an attorney named Scott Humphrey called me on July 2, 2001 indicating he was handling some matters for plaintiffs counsel, Richard Hawkins[,] while Mr. Hawkins was ill. [P] . . . Mr. Humphrey indicated he would consider stipulating to a judgment in the Caron action. Mr. Humphrey indicated he would look into the matter and call me once a decision was made. [P] . . . On July 6, 2001 I filed a declaration with the court (in lieu of a reply brief) to inform the court of my conversations with Mr. Humphrey and his remarks that plaintiffs counsel had been hospitalized with cancer. . . . [P] . . . Also on July 6, 2001, Mr. Humphrey called me again and left a message indicating plaintiff was willing to stipulate allowing a default judgment to be entered against him based upon a collateral estoppel effect of the judgment in the Hemphill v. Zurich case. Mr. Humphrey then indicated that if the parties would not agree to such stipulation, his firm would associate in the action to formally represent plaintiff. [P] . . . [P] . . . On July 10, 2001, Mr. Humphrey called me to provide additional details regarding his proposal that Caron stipulate to allow judgment to be entered against him. [P] . . . On July, 12, 2001, I spoke to Mr. Humphrey who indicated that he discussed the case with Mr. Hawkins and Mr. Humphrey would not be associating into the case as counsel for plaintiff. [P] . . . Also on July 12, 2001, Mr. Hawkins[s] wife/secretary faxed to me a letter and declaration with an indication that Mr. Hawkins would not appear at the hearing."
In the declaration filed with the court on July 6, 2001, Mr. Mines states that he asked his secretary to call plaintiffs counsel to request a fax copy of the opposition to the summary judgment motion. The declaration then states: "In response to my secretarys message, I received a phone call on July 2, 2001 from an attorney named Scott Humphrey. Mr. Humphrey indicated he is not associated with plaintiffs counsel in this matter, but does represent the plaintiff in a different case. Mr. Humphrey indicated plaintiffs counsel, Richard Hawkins, has been hospitalized for two months with cancer. [P] . . . Mr. Humphrey indicated he would consider stipulating to allow judgment to enter in this action and resolve the matter on appeal. . . . Mr. Humphrey then indicated he would contact me again concerning the matter." The declaration concludes with a request that the motion for summary judgment be granted because plaintiff had not opposed the motion, nor had he disputed any of the material facts.
The hearing on the summary judgment motion was then held on July 13, 2001. Mr. Hawkins cites the courts statement at the beginning of the hearing on the summary judgment motion: "Its my understanding that plaintiff had been contacted, he did not intend to be here, and he did not oppose this motion. The Courts intended decision was to grant the motion for summary judgment on the grounds stated." In response, defense counsel asked if the court had received his declaration quoted above. The court stated that the declaration was received, reviewed, and filed. The court then granted the motion for summary judgment. The order granting the motion for summary judgment was filed on July 27, 2001.
On January 29, 2002, plaintiff filed a motion to set aside a "default judgment" under section 473. The motion was based on the theory that the granting of summary judgment without opposition was the granting of a default judgment. Accordingly, the motion was to set aside the granting of the motion for summary judgment.
On March 6, 2002, the trial court denied the motion to set aside the summary judgment. It did not give any explanation for its decision.
SECTION 473Plaintiff contends the trial court abused its discretion in denying his motion under section 473. He relies on both the mandatory and discretionary provisions of section 473.
1. The Mandatory Relief Provision. The mandatory provision of section 473 states: "Notwithstanding any other requirements of this section, the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorneys sworn affidavit attesting to his or her mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against his or her client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against his or her client, unless the court finds that the default or dismissal was not in fact caused by the attorneys mistake, inadvertence, surprise, or neglect."
"The purpose of this provision was to alleviate the hardship on parties who lose their day in court due solely to an inexcusable failure to act on the part of their attorneys. [Citation.] Thus, the Legislature created a narrow exception to the discretionary relief provision for default judgments and dismissals. [Citation.]" (Zamora v. Clayborn Contracting Group, Inc. (2002) 28 Cal.4th 249, 257.)
But a decision granting a motion for summary judgment is not subject to the mandatory provision of section 473, subdivision (b) because it is not a default judgment or dismissal. (English v. IKON Business Solutions, Inc., supra , 94 Cal.App.4th 130.) We therefore disagree with plaintiffs attempt to characterize his failure to contest the summary judgment motion as a default resulting in a default judgment within the meaning of the mandatory provision of section 473. Our disagreement is fully supported by English, which we find to be a particularly thorough and well-reasoned opinion. English concludes: "By its very nature, a summary judgment is distinct from both a default and a default judgment as those terms are used in section 473(b)." (English, at p. 144.) Nor is a summary judgment a "dismissal" within the meaning of section 473. (Id. at p. 148.) We therefore conclude that the mandatory relief provision is inapplicable here.
2. The Discretionary Relief Provision. Plaintiff contends that the trial court abused its discretion in denying him relief under the discretionary relief provision of section 473, subdivision (b). That provision states: "The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect."
In Mann v. Cracchiolo (1985) 38 Cal.3d 18, 210 Cal. Rptr. 762, 694 P.2d 1134, our Supreme Court held that the trial court erred in refusing to consider opposition papers to a summary judgment motion which were filed late. The court said: "We agree with the view expressed in Shadle[ ] and Kapitanski[ ] that in the absence of legislative direction to the contrary courts may adopt local rules with the force of law and that reasonable local rules limiting the time to file opposition to the summary judgment motion were not precluded by former Code of Civil Procedure section 437c. Interruption and delay of hearings which such rules are designed to prevent justify court management of its procedures. However, weighing the potential for interruption and delay against the policy in favor of disposition of cases on their merits, the drastic nature of the summary judgment remedy, and the potentially short time available to respond to the summary judgment motion, we are satisfied that courts were required to exercise their discretion and relieve the attorney from tardy opposition filings when his conduct was reasonable, as pointed out in Kapitanski." (Mann, at pp. 29-30, fn. omitted.)
Shadle v. City of Corona (1979) 96 Cal. App. 3d 173, 157 Cal. Rptr. 624.
Kapitanski v. Vons Grocery Co. (1983) 146 Cal. App. 3d 29, 193 Cal. Rptr. 839.
In Kapitanski, the court held that "In applying the statutory grounds for relief under section 473 trial courts must consider the specific contexts in which such motions arise and should employ a flexible rather than rigid or formalistic approach to decisionmaking. . . . An attorneys neglect in untimely filing opposing papers must be evaluated in light of the reasonableness of the attorneys conduct. [Citation.]" (Kapitanski v. Vons Grocery Co., supra, 146 Cal. App. 3d 29, 32-33.)
The issue was whether counsel had a satisfactory excuse for his mistake. (Eigner v. Worthington, supra, 57 Cal.App.4th 188, 196.) In hearing the section 473 motion to set aside its order granting Zurich Americans motion for summary judgment, the trial court should have evaluated the reasonableness of Mr. Hawkinss conduct. The declaration of Mr. Hawkins supported a conclusion that his failure to file an opposition to the motion and his failure to appear at the hearing were reasonable due to his illness and hospitalization.
We allowed augmentation of the record to include a transcript of the March 6, 2002, hearing. The transcript shows only that the matter was argued and taken under submission. The record does not state the basis for the trial courts decision.
Zurich American argues that Mr. Hawkinss conduct was unreasonable and inexcusable because it was negligent. It cites Garcia v. Hejmadi (1997) 58 Cal.App.4th 674, which states that conduct falling below the professional standard of care is not excusable. (Id. at p. 682.) Garcia is cited in Zamora. Our Supreme Court said: "A party who seeks relief under section 473 on the basis of mistake or inadvertence of counsel must demonstrate that such mistake, inadvertence, or general neglect was excusable because the negligence of the attorney is imputed to his client and may not be offered by the latter as a basis for relief. [Citation.] In determining whether the attorneys mistake or inadvertence was excusable, the court inquires whether "a reasonably prudent person under the same or similar circumstances" might have made the same error." [Citation.] In other words, the discretionary relief provision of section 473 only permits relief from attorney error fairly imputable to the client, i.e., mistakes anyone could have made. [Citation. Conduct falling below the professional standard of care, such as failure to timely object or to properly advance an argument, is not therefore excusable. To hold otherwise would be to eliminate the express statutory requirement of excusability and effectively eviscerate the concept of attorney malpractice. [Citation.]" (Zamora v. Clayborn Contracting Group, Inc., supra , 28 Cal.4th 249, 258.) When illness is alleged, details, such as a doctors declaration, are necessary to establish excusable neglect. (Transit Ads, Inc. v. Tanner Motor Livery, Ltd. (1969) 270 Cal. App. 2d 275, 286-287, 75 Cal. Rptr. 848.) The facts of Transit Ads are close to the facts here, and in both cases other attorneys were available to help during the illness. Accordingly, the court ruled in Transit Ads that there was no showing that disabling illness, and not inexcusable neglect, was the real reason for the default. (Ibid .)
As noted above, we do not know whether the trial court considered this argument or not. In its opposition to the section 473 motion, Zurich American only argued that the motion was untimely, that the mandatory relief provisions did not apply to summary judgments, and that plaintiffs declaration was insufficient to justify relief. The latter contention was based on the argument that the attorney handling the matter for Mr. Hawkins during his illness had failed to file a declaration, and that the attorneys suggestion that the matter be dealt with on appeal was a tactical decision. The court may have based its decision on any of these grounds. It may also have found no excusable neglect.
Accordingly, we must conclude that Mr. Caron has not carried his burden of demonstrating abuse of discretion. (Luz v. Lopes (1960) 55 Cal.2d 54, 62, 10 Cal. Rptr. 161, 358 P.2d 289. ["The burden of proof on . . . a [section 473] motion is on the moving party who must establish his position by a preponderance of the evidence."].) "In reviewing the evidence in support of a section 473 motion, we extend all legitimate and reasonable inferences to uphold the judgment. The disposition of such a motion rests largely in the discretion of the trial court, and its decision will not be disturbed on appeal unless there has been a clear abuse of discretion. Although precise definition is difficult, it is generally accepted that the appropriate test of abuse of discretion is whether or not the trial court exceeded the bounds of reason, all of the circumstances before it being considered. [Citations.] We have said that when two or more inferences can reasonably be deduced from the facts, a reviewing court lacks power to substitute its deductions for those of the trial court. [Citations.]" (In re Marriage of Connolly (1979) 23 Cal.3d 590, 597-598, 153 Cal. Rptr. 423, 591 P.2d 911.) These principles apply here, and Mr. Caron has not shown that the trial court abused its discretion in denying his motion for relief under section 473. (Luri v. Greenwald (2003) 107 Cal.App.4th 1119, 1128-1129.)
SECTION 286Section 286 states: "When an attorney dies, or is removed or suspended, or ceases to act as such, a party to an action, for whom he was acting as attorney, must, before any further proceedings are had against him, be required by the adverse party, by written notice, to appoint another attorney, or to appear in person."
Mr. Caron argues that defense counsel failed to give this notice, even though they knew that Mr. Hawkins had ceased to act as his attorney due to illness.
The difficulty with this argument, as Zurich American points out, is that its attorney, Mr. Mines, declared that he was told by Mr. Humphrey that Mr. Humphrey was handling the matter while Mr. Hawkins was incapacitated. They discussed a stipulation to allow the summary judgment to be taken so that the issue of collateral estoppel presented at the hearing could be decided on appeal. Mr. Mines could reasonably conclude from these discussions that Mr. Caron was being represented by counsel during Mr. Hawkinss incapacity. Mr. Mines promptly advised the court, by filing a formal declaration, of the incapacity of Mr. Hawkins and the conversation with Mr. Humphrey. Even though no opposition was filed to the summary judgment motion, and no appearance was made, the court took no action to assure that Mr. Caron was represented.
In his declaration, Mr. Mines also stated that someone had called the court on behalf of plaintiff on the morning of the hearing. This call may have been the basis for the trial courts statement at the beginning of the hearing that "plaintiff had been contacted, he did not intend to be here, and he did not oppose this motion."
Mr. Caron provided no contrary declaration from Mr. Humphrey. The trial court could therefore reasonably conclude that notice to the client under section 286 was not required because Mr. Hawkins had made arrangements for another attorney to represent Mr. Caron during Mr. Hawkinss incapacity. If it reached that conclusion, it properly rejected Mr. Carons argument that this alleged violation was another reason to set aside the "default judgment."
Mr. Caron cited Aldrich v. San Fernando Valley Lumber Co. (1985) 170 Cal. App. 3d 725, 216 Cal. Rptr. 300. In that case, the trial court vacated a prior order dismissing the action for failure to serve answers to interrogatories. (Id. at p. 730.) The person seeking the order to vacate cited section 286. Although the trial court acted under its inherent equity powers, the appellate court noted the reliance on section 286 and said: "The purpose of section 286 is to provide notice to a party who might otherwise be taken unaware. [Citation.]" (Aldrich, at p. 742.) The appellate court found that the circumstances should have given appellants counsel cause to suspect that something was wrong and, in fact, respondents attorney had been suspended from the practice of law. (Id. at pp. 741, 743.) Since the requisite notice was not given, the court was without authority to proceed. (Id. at p. 742.)
Aldrich is not helpful here because, under the facts stated above, the trial court could find that, although Mr. Mimes was aware of Mr. Hawkinss health problems, he was also informed and believed that other counsel were representing Mr. Carons interests. Accordingly, it could properly find that it was able to proceed notwithstanding section 286. Although no findings were made, no abuse of discretion or lack of jurisdiction has been shown.
The issue of notice to Mr. Caron is somewhat academic here, as he is a permanent quadriplegic. However, his mother is his guardian ad litem and notice could have been given to her. Presumably, she would have continued to act in his best interests.
DISPOSITION
The order denying Mr. Carons section 473 motion to set aside the July 27, 2001, judgment is affirmed.
We concur: RICHLI J. KING J.