Monday, December 28, 2020
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California Supreme Court:
Default Judgment Can’t Exceed Amount in Prayer Even Though Accounting Is Sought
By a MetNews Staff Writer
The rule, encrusted in Code of Civil Procedure §580(a), that a default judgment is limited to the amount sought by the complaint applies even where the plaintiff doesn’t know the exact amount that is owed and is seeking an accounting, the California Supreme Court held Thursday.
Chief Justice Tani Cantil-Sakauye wrote the opinion for a unanimous court. It affirms a March 17, 2019 decision by Div. Two of this district’s Court of Appeal.
That opinion, by Justice Brian M. Hoffstadt, reverses a default judgment granted by Los Angeles Superior Court Judge Frederick C. Shaller for $2.8 million and remands the case for a determination of whether to enter judgment for the $987,500 sought in the operative complaint or to allow an amendment to seek a greater amount.
The chief justice said in Thursday’s opinion:
“[W]e conclude that in cases where plaintiffs seek monetary relief, the mere fact that they have pleaded an accounting action does not insulate them from the obligation to notify defendants of the dollar amounts sought before such relief may be granted in default. True, the text of section 580 does not point unerringly to this result. Nonetheless, when section 580 is considered in light of its purpose —’to guarantee defaulting parties adequate notice of the maximum judgment that may be assessed against them’…—and in conjunction with other statutes related to pleadings and default judgments, we find the most reasonable interpretation of section 580 is that it requires plaintiffs to have alleged their ‘relief’ in terms of dollars if they are to receive monetary recovery.”
She pointed out that plaintiffs who seek an accounting may not know the precise amount that is due them but can usually make a guess; they are going to have to present proof as to the amount at the default prove-up; and they “may request that the trial court take an accounting in circumstances where an accounting is necessary to discover the information needed to determine the amount owing.”
Hoffstadt’s opinion also holds that where a complaint contains multiple claims, “the amounts of damages awarded and demanded are to be compared on an aggregate basis,” not a claim-by-claim basis. Cantil-Sakauye said:
“[W]e find we need not resolve that question in order to dispose of the matter before us….[W]e reserve judgment on that issue for another day.”
The case is Sass v. Cohen, 2020 S.O.S. 6142.
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