Grossman v. Baca

MARC GROSSMAN, Plaintiff and Appellant, v. LEONARD BACA, Defendant and Respondent.

E068426

COURT OF APPEAL OF THE STATE OF CALIFORNIA FOURTH APPELLATE DISTRICT DIVISION TWO

October 31, 2018

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Super.Ct.No. CIVDS1700093)

OPINION

APPEAL from the Superior Court of San Bernardino County. David Cohn, Judge. Affirmed.

Law Offices of Marc E. Grossman, Marc E. Grossman and Eva M. Hollands, for Plaintiff and Appellant.

BWA Law Group and Christian F. Paul for Defendant and Respondent.

This lawsuit is a collateral attack on a default judgment entered against plaintiff and appellant Marc Grossman in a small claims action brought by defendant and respondent Leonard Baca. Grossman appeals from the judgment of dismissal entered after the trial court sustained Baca's demurrer without leave to amend. Grossman contends that he adequately pleaded a cause of action for declaratory relief because the small claims judgment is void for lack of personal and subject matter jurisdiction, or he could plead such a cause of action if given leave to amend.

We find that the small claims court did not lack either personal or subject matter jurisdiction, and therefore affirm the judgment.

I. FACTUAL AND PROCEDURAL BACKGROUND

This lawsuit is the third in a chain of events, beginning with a civil case in which Grossman acted as a lawyer adverse to Baca. Baca's small claims lawsuit came next. Grossman then filed this lawsuit attacking the small claims judgment against him.

In the initial civil action, Baca was the defendant in Kramer v. Baca (San Bernardino County Superior Court case No. CIVDS1417620) (the underlying action). The plaintiff in the underlying action was represented by the Law Offices of Marc Grossman (the law firm), an "eight-attorney law firm bearing the name of its founder." The underlying action settled, with the parties stipulating that the plaintiff would dismiss his claims in exchange for a payment from Baca, and that "'[e]ach party will bear its own costs and legal fees.'"

The trial court in the underlying action set an Order to Show Cause (OSC) hearing regarding dismissal for July 8, 2016. The law firm filed a request for dismissal on July 6, 2016, and informed Baca's attorney by telephone that the request for dismissal "had been timely filed and that there would be no need to appear for the OSC hearing." The OSC hearing was not immediately taken off calendar, however, and Baca's attorney chose to attend. The trial court later entered the dismissal, backdating it to July 6, 2016.

Baca's attorney billed Baca $367.25 for attending the OSC hearing. On August 23, 2016, Baca wrote Grossman, requesting reimbursement for the $367.25. Grossman declined the request.

On August 29, 2016, Baca filed a small claims action (San Bernardino County Superior Court case No. SMCFS1607394) against "'Marc Grossman, Attorney at Law,'" listing the law firm's address and phone number as the defendant's. Baca claimed that he was owed $367.25, alleging as follows: "Mr. Grossman failed to dismiss the case, after settlement, in a timely manner which caused m[e] to have to keep contacting Mr. Grossman to avoid an OSC re dismissal. This caused additional attorney fees to me due to continued contact with Mr. Grossman and staff to close the case." An agent of the sheriff's department served process by substituted service, leaving a copy of the claim and order with the law firm's receptionist, and then mailing a copy of the documents.

On October 26, 2016, the law firm sent one of its attorneys, Michael De La Garza, to speak on its behalf at the trial of Baca's small claims action. The court did not allow De La Garza to appear, however, interpreting the action as being against Grossman as an individual, not the law firm as an entity. Grossman alleges that he called the court "to explain that De La Garza was not there as an attorney, but as a representative of the business entity, and that if the suit was against Grossman, the individual, then the Summons had not properly been served on Grossman," so Grossman requested a continuance to appear in person. (Some capitalization omitted.) The court did not grant a continuance, but instead proceeded to hear the case in Grossman's absence. The court awarded Baca a default judgment against Grossman in the amount of $437.25, consistingof the $367.25 claimed by Baca, plus $70 in costs. Notice of entry of judgment was filed and mailed on October 31, 2016.

On December 2, 2016, Grossman filed a motion to vacate the default judgment in the small claims action. The small claims court denied that motion on January 5, 2017, finding it "untimely." Grossman appealed the denial on January 13, 2017, arguing that because of the "obvious confusion of who exactly the defendant was" the small claims court should have continued the case rather than hearing the matter in Grossman's absence and entering a default judgment. Grossman's appeal also addressed the merits of the action, asserting that only the court in the underlying action had jurisdiction over Baca's claim, and that even if the small claims court had jurisdiction, Grossman was not liable for Baca's claimed attorney fees. Grossman further asserted that this lawsuit for declaratory relief, which he filed on January 3, 2017, "divests the small claims court of subject matter jurisdiction in favor of civil court." Appeals in small claims cases proceed to an individual superior court judge. (Code Civ. Proc.,¹ § 116.710, subd. (b).) On February 15, 2017, the superior court (Judge David A. Williams) rejected Grossman's appeal, affirming the denial of the motion to vacate.

Grossman's complaint in this lawsuit asserts a cause of action for declaratory relief that is in essence a collateral attack on the small claims judgment. Grossman requests "a declaration that [Baca] agreed to bear all of his costs and legal fees stemming from [the underlying case], including his attorney's appearance at the July 8, 2016, OSChearing." Baca demurred to the complaint. On March 14, 2017, the trial court (Judge David Cohn) sustained the demurrer without leave to amend.

II. DISCUSSION

A. Standard of Review

On appeal from a judgment based on an order sustaining a demurrer, we assume all the facts alleged in the complaint are true. (Pineda v. Williams-Sonoma Stores, Inc. (2011) 51 Cal.4th 524, 528.) In addition, we consider judicially noticed matters. (Committee for Green Foothills v. Santa Clara County Bd. of Supervisors (2010) 48 Cal.4th 32, 42.) We accept all properly pleaded material facts but not contentions, deductions, or conclusions of fact or law. (Evans v. City of Berkeley (2006) 38 Cal.4th 1, 6.) We determine de novo whether the complaint alleges facts sufficient to state a cause of action under any legal theory. (Committee for Green Foothills, supra, at p. 42.) We read the complaint as a whole and its parts in their context to give the complaint a reasonable interpretation. (Evans, supra, at p. 6.)

When a trial court has sustained a demurrer without leave to amend, "we decide whether there is a reasonable possibility that the defect can be cured by amendment: if it can be, the trial court has abused its discretion and we reverse; if not, there has been no abuse of discretion and we affirm. [Citations.] The burden of proving such reasonable possibility is squarely on the plaintiff." (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.) "[U]nless failure to grant leave to amend was an abuse of discretion, the appellate court must affirm the judgment if it is correct on any theory." (Hendy v. Losse (1991) 54 Cal.3d 723, 742.)

B. The Small Claims Court Did Not Lack Jurisdiction

Grossman contends that a collateral attack on the small claims judgment is permissible because the small claims court lacked jurisdiction over the case, so its judgment is void and may be "'"attacked anywhere, directly or collaterally whenever it presents itself . . . ."'"² (OC Interior Services, LLC v. Nationstar Mortgage, LLC (2017) 7 Cal.App.5th 1318, 1330.) We find that the small claims court had both subject matter and personal jurisdiction over Baca's claim against Grossman.

1. Subject Matter Jurisdiction

Baca's claim in the small claims action was that Grossman failed to timely dismiss the underlying action as agreed, causing Baca to incur a $367.25 fee for Baca's attorney's appearance at an OSC hearing. Grossman contends that, pursuant to section 664.6, the court in the underlying action had exclusive jurisdiction over the claim asserted against him by Baca in the small claims action, so the default judgment is void for lack of subject matter jurisdiction. We disagree.

Grossman's argument that Baca's claim could be brought only in the underlying action fails for at least four reasons. First, Grossman has not adequately alleged that the stipulation for settlement of the underlying action even purports to allow that court totake jurisdiction over Baca's claim against Grossman. The complaint alleges that the parties' stipulation "included a provision stating that, '[e]ach party will bear its own costs and legal fees.'" But it does not allege that the parties requested that the court retain jurisdiction pursuant to section 664.6 in the stipulation for settlement, or that the court granted the request. (See Sayta v. Chu (2017) 17 Cal.App.5th 960, 967 ["The parties were required to present to the trial court a proper request to retain jurisdiction for purpose of section 664.6 motions."].) And neither the stipulation for settlement, nor the judgment entered in the underlying action, appears in our record.

Second, it is not apparent that the underlying action settlement language applies to the dispute...