Monday, April 6, 2020
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2006 Default Judgment Improperly Vacated In 2018 Based on Misperceived Flaw—C.A.
By a MetNews Staff Writer
A Los Angeles Superior Court judge erred in 2018 in ordering that a 2006 default judgment be vacated based on voidness, the Court of Appeal for this district declared on Friday, holding that the answer to an initial complaint seeking recovery of loaned money did not suffice as an answer to an amended complaint which added causes of action.
The opinion, which was not certified for publication, was authored by Acting Presiding Justice Lamar Baker of Div. Five. It reverses an order by Judge Gerald Rosenberg.
Baker’s opinion reinstates a judgment owned by Sabine Kaneko based on money loaned by her mother, since deceased, to Toshio Masui who was, at the time of the loan in the early 1990s, Kaneko’s husband. Masui borrowed the money—$229,407—ostensibly to make a real estate investment, but allegedly otherwise applied the funds.
Default Judgment Obtained
The mother brought suit in 1993, stating causes of action for fraud, breach of contract, and based on common counts, and Masui answered. In an amended complaint, causes of action were added; no answer was filed; a default judgment was obtained on March 25, 1996, for $640,335.40.
The judgment reflected the amount of the loan, punitive damages of $250,000, interest which then came to $160,620.95—and which has been mounting over the past 24 years—and $308 in costs.
In 2006, the judgment was renewed by Kaneko’s mother; in 2015 Kaneko again renewed it, her mother having died; Masui moved for an order vacating the renewal; the Los Angeles Superior Court denied his motion; the Court of Appeal on Sept. 29, 2017 affirmed.
Motion Before Rosenberg
Matsui then moved for an order vacating the default judgment, which Rosenberg granted on April 12, 2018, citing the Fifth District Court of Appeal’s 1985 decision in Carrasco v. Craft.
That case relied upon the California Supreme Court’s 1928 decision in Gray v. Hall which, the Fifth District noted, held “that entry of a default in a case where the original answer can stand as an answer to the amended complaint constitutes error.”
In the case before it, the Fresno-based appeals court said, “as a matter of law, defendants’ original answer could stand as an answer to the amended complaint and, therefore, it was error to enter the default and default judgment on the basis that the defendants failed to file an answer to the amended complaint.”
Baker’s Opinion
In his opinion reversing Rosenberg’s order, Baker declared that “the analogy to Carrasco…breaks down” because causes of action in the May 1994 amended complaint were not addressed by the previously filed answer. The amended pleading, he said, added a cause of action for conversion.
This change, he observed, was “substantive, not formal or immaterial” and “changed the cause of action” against Masui.
“As a result, Toshio was required to file an answer responding to the new allegations and new conversion claim in the amended complaint,” Baker wrote. “Because he did not, the default judgment entered against him was valid and the trial court should not have vacated it.”
The case is Kaneko v. Masui, B291825.
Kaneko, who is a business executive and not an attorney, represented herself. Century City attorney Robert W. Cohen acted for Masui.
Copyright 2020, Metropolitan News Company