Filed 4/27/16 Law Offices of Joseph P. Scully v. Gambina CA4/3




                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS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
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or ordered published for purposes of rule 8.1115.


              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE


LAW OFFICES OF JOSEPH P. SCULLY,
P.C.,
                                                                       G050600
     Plaintiff and Appellant,
                                                                       (Super. Ct. No. 30-2013-00637844)
         v.
                                                                       OPINION
JOHN GAMBINA,

     Defendant and Respondent.



                   Appeal from a judgment and order of the Superior Court of Orange County,
James E. Loveder, Temporary Judge. (Pursuant to Cal. Const., art. VI, § 21.) Affirmed.
                   The Law Office of John Derrick and John Derrick for Plaintiff and
Appellant.
                   Smith Hall Strongin, Eric B. Strongin and Ladan Shelechi for Defendant
and Respondent.
                                             INTRODUCTION
                 Attorney Joseph Scully appeals from an order vacating a default and a
default judgment against his former client, John Gambina. The trial court granted
Gambina’s motion to set aside the default on the ground that Scully had committed
extrinsic fraud by failing to send Gambina the notice of the availability of arbitration of
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fee disputes as required by Business and Professions Code section 6201 when Scully
sued him for unpaid fees. Because the court vacated the default, it also vacated the
default judgment Scully had obtained against Gambina.
                 We affirm. The trial court exercised its discretion to set aside both the
default and the default judgment. Under the circumstances here presented, we cannot
find abuse of this discretion.
                                                    FACTS
                 Scully filed a complaint for attorney fees against Gambina on March 15,
2013. Scully did not send Gambina the notice of the client’s right to arbitrate fee
disputes mandated by section 6201, subdivision (a), either with the summons or at any
other time. Gambina did not respond, and default was entered against him on May 7,
2013.
                 Representing himself, Gambina moved to set aside the default on June 13,
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2013. The grounds were quite difficult to ascertain and mostly dealt with the merits of
Scully’s lawsuit. For example, he claimed he had never discussed fees with Scully “until
[Gambina] received the Summons.” As to the reason he did not timely respond, Gambina
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stated, “I was served several weeks after the 3/15/2013 was server on 4/12/2013 [sic].”
            1
                 All further statutory references are to the Business and Professions Code unless otherwise
indicated.
            2
                  Gambina called his pleading a motion to set aside a default judgment, but as of that time, no
judgmen t had been entered.
        3
                  The proof of service stated that Gambina was served by substitute service on March 24, 2013,
with a mailing the next day.


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He further stated, “Also had to spend time [] figuring out what to do” and asserted that
his brother was “in and out” of the hospital for a broken vertebra and needed his care. He
also claimed to be surviving on food stamps. “I could not [afford an] attorney and since I
had property legal aid would not help.” The motion was taken off calendar at a hearing
on July 10 for failure to serve Scully with the moving papers in accordance with the Code
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of Civil Procedure. At a case management conference over a month later, in August, the
court inquired as to whether Gambina had filed a new motion. He had not. The court
continued the case management conference to November 12, 2013.
                  Gambina made his second attempt on November 6, 2013. Although he was
still representing himself, Gambina’s papers looked somewhat more professional, and, as
it turned out, he had used legal aid to assist him in preparing them. As one of the reasons
for setting aside the default, Gambina stated, “[S]ince the instant lawsuit is based on the
alleged non-payment of attorney fees, prior to commencing the instant action, [Scully]
was required to serve [Gambina] with a ‘Notice of Client’s Right to Fee Arbitration.’”
He then cited section 6201, subdivision (a), and asked the court to dismiss the lawsuit
pursuant to its terms. He also asked the court to take judicial notice of his petition to
arbitrate a fee dispute, purportedly submitted to the Orange County Bar Association, and
the notice of a stay pending arbitration, copies of which were attached to his motion. The
notice of stay and the petition to arbitrate the fee dispute were dated November 5, 2013.
                  The trial court (Judge Horn) denied the motion on several grounds at a
hearing on December 18, at which Gambina was present. Analyzing the motion first
under Code of Civil Procedure section 473, the court observed that the “evidence” was
largely contained in the memorandum of points and authorities, not in a sworn
declaration. But even considering the statements in the points and authorities as


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                  At the hearing, the court strongly advised Gambina to get legal assistance with his pleadings. It
also explained to Gambina that, he could refile the motion. Gambina’s brother, who was present at the hearing,
asked him, “Where have you been going to legal aid?”


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evidence, Gambina had not explained why he failed to timely respond to the complaint
(since the summons clearly stated he had to respond in 30 days) or why he waited nearly
six months to seek help in seeking to set aside the default. The court was thus unable to
determine whether he had sought the court’s assistance within a “reasonable time,” as
required by the statute.
              The court also analyzed the court’s power to grant equitable relief, in
addition to its statutory power. Again, Gambina had failed to present evidence to support
equitable relief, even if he had not received the notice required by section 6201. He had
not given the court evidence of a satisfactory excuse for not presenting the defense or
evidence of diligence. The ruling then stated, “The statutory time limits on relief under
CCP §473(b) do not apply here, and [Gambina] may still re-file a motion for equitable
relief (in order to present sufficient evidence).”
              Judge Horn also advised Gambina that, although his request for a stay was
being denied as not in the court’s power, Gambina did not need court permission to file a
notice of stay. The effect of filing this document would be to stay the action. The record
does not indicate Gambina ever filed the notice of stay.
              On February 28, 2014, after a default prove-up, the court entered a default
judgment against Gambina for $272,965. The notice of entry of judgment was filed and
served on March 18.
              Gambina, this time represented by counsel, filed an ex parte application to
set aside the default and the default judgment on May 15, 2014. The application was
converted to a regularly noticed motion, and it was heard on July 11, 2014, by a judge
other than Judge Horn. The motion to set aside the default was now well beyond the six-
month period permitted by Code of Civil Procedure section 473; the motion to vacate the
default judgment, however, was still within the statutory time period.
              After supplemental briefing on the effect of Scully’s failure to comply with
section 6201, the court granted the motion to set aside both the default and the default

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judgment on equitable grounds. As to Gambina’s diligence, the court stated, “[Gambina]
has been diligent in seeking relief. This motion is his third. The prior motions were
made within six months after the default was taken. He appeared without benefit of
counsel.”
                                                DISCUSSION
                  An order vacating a default and a default judgment is appealable as an order
after final judgment. (County of Stanislaus v. Johnson (1996) 43 Cal.App.4th 832, 834;
Code Civ. Proc., § 904.1, subd. (a)(2).) We will pass over the problems created by
having a judge other than the one who heard a motion hear what was in essence a motion
for reconsideration (see Code Civ. Proc., § 1008, subd. (a)) and by the court’s invitation
to Gambina to refile a motion on the same grounds that had already been decided against
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him. Instead, we will focus on the trial court’s discretion to grant equitable relief to set
aside an order or judgment.
I.                Default
                  Because the time for relief under Code of Civil Procedure section 473 had
expired, Gambina had to provide the trial court with grounds to exercise its equitable
powers to vacate the default. Specifically, he had to show the court that “extrinsic fraud”
prevented him from having his “day in court.” We review the court’s decision to vacate a
default for abuse of discretion. (Rappleyea, supra, 8 Cal.4th at 982.)
                  “‘“Extrinsic fraud occurs when a party is deprived of the opportunity to
present his claim or defense to the court; where he was kept ignorant or, other than from
his own negligence, fraudulently prevented from fully participating in the proceeding.
[Citation.] Examples of extrinsic fraud are: … failure to give notice of the action to the
other party, and convincing the other party not to obtain counsel because the matter will

         5
                  The trial court may have been influenced in this latter act by Gambina’s status as a self-
represented party notwithstanding his help from legal aid. The rules for parties represented by counsel and those
represented by themselves are the same. (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 984-985 (Rappleyea ).)
“My counsel prepared a really bad set of papers” should not cut much ice as an excuse for either category.


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not proceed (and then it does proceed). [Citation.] The essence of extrinsic fraud is one
party’s preventing the other from having his day in court.” [Citations.] Extrinsic fraud
only arises when one party has in some way fraudulently been prevented from presenting
his or her claim or defense. [Citations.]’ [Citation.]” (Moghaddam v. Bone (2006) 142
Cal.App.4th 283, 290 (Moghaddam).)
              “To set aside a judgment based on extrinsic fraud or extrinsic mistake, the
moving party must satisfy three elements: ‘First, the defaulted party must demonstrate
that it has a meritorious case. Secondly, the party seeking to set aside the default must
articulate a satisfactory excuse for not presenting a defense to the original action. Lastly,
the moving party must demonstrate diligence in seeking to set aside the default once it
had been discovered.’ [Citations.]” (Moghaddam, supra, 142 Cal.App.4th at pp. 290-
291.)
              We cannot find that the trial court abused its discretion when it determined
that Gambina had fulfilled the requirements for a finding of extrinsic fraud for failing to
give the notice mandated by section 6201, subdivision (a). Scully does not dispute that
Gambina presented evidence of a meritorious case. The trial court determined, based on
the record before it, that both the excuse for not responding to the original action and the
diligence Gambina exhibited in working to get the default set aside were satisfactory.
We do not disturb the trial court’s assessment in such cases. (Benjamin v. Dalmo Mfg.
Co. (1948) 31 Cal.2d 523; see Waite v. Southern Pacific Co. (1923) 192 Cal. 467, 471.)
II.           Default Judgment
               Gambina’s motion to set aside the default judgment was made within the
time limits prescribed by Code of Civil Procedure section 473. The trial court has wide
discretion to grant such a motion. (Gardner v. Superior Court (1986) 182 Cal.App.3d
335, 338-339.) As we are reversing the default upon which the judgment rests, the
default judgment too must be reversed. (See Sole Energy Co. v. Hodges (2005) 128
Cal.App.4th 199, 210 [default judgment based on flawed entry of default reversed].)

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III.          Request for Judicial Notice
              Appellant has requested judicial notice of the California State Bar’s
guidelines for fee arbitration programs and the Orange County Bar Association’s
mandatory fee arbitration rules. Judicial notice of these documents is unnecessary to the
determination of this appeal; we therefore deny the request. (See In re Loveton (2016)
244 Cal.App.4th 1025, 1045, fn. 17.)
                                     DISPOSITION
              The order vacating the default and the default judgment is affirmed.
Appellant’s request for judicial notice is denied. Respondent is to recover his costs on
appeal.




                                                 BEDSWORTH, ACTING P. J.

WE CONCUR:



ARONSON, J.



FYBEL, J.




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