Tuesday, June 18, 2002
Discretionary Relief Law Applies to Judgment Based On Settlement Offer, State High Court Rules
By a MetNews Staff Writer
The statute permitting a judge to set aside a judgment obtained through mistake or excusable neglect applies to a judgment based on a statutory settlement offer, the state Supreme Court ruled yesterday.
The justices unanimously affirmed lower court rulings setting aside a $149,999 judgment against Pablo Zamora, an engineer involved in a breach of contract suit against a builder. The judgment, Justice Janice Rogers Brown explained, was the result of a “typo” in a Code of Civil Procedure Sec. 998 offer by Zamora’s attorney.
Zamora, who supplied road signs to Clayborn Contracting Group, Inc. for a project in Fresno County, sued for $143,000 plus attorney fees. Clayborn cross-complained after sending Zamora an invoice for more than $150,000 he allegedly owed Clayborn.
Zamora’s lawyer sent opposing counsel a Sec. 998 offer saying Zamora would be willing to “have judgment taken against himself and for…Clayborn…for the sum of $149,999.” Clayborn promptly accepted.
A week later, Zamora’s counsel moved for relief under Sec. 473(b). In supporting papers, the lawyers said that they had been instructed by Zamora to offer to settle for $149,999 in favor of Zamora, that a legal assistant was told to prepare such an offer, and that the assistant had mistakenly prepared an offer to have judgment taken against the client in that amount and sent the offer with the attorney’s stamped signature on it.
Clayborn responded that it had accepted the offer in good faith, that it had a legitimate reason to believe that Zamora was indebted to it in that amount, and that Sec. 473(b) did not, as a matter of law, apply to Sec. 998 offers.
But Brown agreed with Fresno Superior Court Judge Stephen J. Kane and the Fifth District Court of Appeal that vacating the judgment was within the trial judge’s discretion.
The jurist rejected the contention that language in the statute referring to a judgment “taken against” the moving party implies that only a default judgment or dismissal can be a proper subject of relief under the law. Nothing in case law or legislative history supports the argument, Brown said.
Nor does the recent addition of language establishing mandatory relief in certain circumstances preclude discretionary relief under the facts of Zamora’s case, Brown said.
Granting relief in this instance is not an abuse of discretion, the justice went on to conclude, because there was no prejudice.
“Here, the trial court reasonably concluded that the mistake made by Zamora’s counsel was excusable. The erroneous substitution of the word ‘against’ for the phrase ‘in favor of’ is a clerical or ministerial mistake that could have been made by anybody. While counsel’s failure to review the document before sending it out was imprudent, we cannot say that his imprudence rendered the mistake inexcusable under the circumstances. Indeed, appellate courts have routinely affirmed orders vacating judgments based on analogous mistakes made by an attorney or his or her staff. For example, courts have set aside judgments where: (1) The attorney mistakenly checked the “with prejudice” box instead of the “without prejudice” box…(2) an associate misinterpreted the instructions of the lead attorney and gave incorrect information at a hearing…and (3) the attorney’s secretary lost the answer to be filed….”
The case is Zamora v. Clayborn Contracting Group, Inc., 02 S.O.S. 3041.
Copyright 2002, Metropolitan News Company