La Tijera Villas LLC v. California Electric & Construction Services Inc., et al.

motion." (Code of Civil Procedure Section 128.5(f)(1)(C).) The court finds that Defendant Cook has not sufficiently demonstrated that an award of reasonable expenses and attorney's fees is warranted here. Accordingly, Defendant Cook's request for an award of reasonable expenses and attorney's fees is DENIED. CONCLUSION Based on the foregoing, Plaintiff's Motion for Sanctions is DENIED. Defendant Cook's request for sanctions is DENIED. Defendant Cook's request for an award of reasonable expenses and attorney's fees is DENIED. Moving party is ordered to give notice of ruling.

Moving Party: Defendant and Cross-Defendant California Electric & Construction Services Inc. Responding Party: Defendant and Cross-Complainant The Carbajal Group, Inc.

The court considered the moving papers, opposition, and reply. California Electric's Motion to Set Aside Entry of Default is DENIED. PROCEDURAL BACKGROUND On December 20, 2024, Plaintiff La Tijera Villas LLC ("Plaintiff") filed a complaint against Defendants California Electric & Construction Services Inc. ("California Electric"), The Carbajal Group, Inc. ("Carbajal"), and DOES 1 through 100, inclusive, alleging four causes of action for: (1) Negligence; (2) Trespass; (3) Private Nuisance; and (4) Negligent Hiring, Supervision & Retention.

On October 8, 2025, Defendant and Cross-Complainant Carbajal filed a cross-complaint against Cross-Defendant California Electric and ROES 1 through 50, inclusive, alleging three causes of action for: (1) Implied Indemnity; (2) Contribution; and (3) Declaratory Relief. The Cross-Complaint was served by substitute service on October 15, 2025. On December 3, 2025, default was entered against California Electric on Carbajal's cross-complaint. On July 10, 2026, California Electric filed the instant motion.

On August 11, 2026, Carbajal filed an opposition. On August 19, 2026, California Electric filed a reply. On August 3, 2026, California Electric filed a cross-complaint against MOES 1 through 20, inclusive, alleging eight causes of action for: (1) Equitable Indemnity; (2) Implied Indemnity; (3) Apportionment of Fault/Contribution; (4) Express Indemnity; (5) Declaratory Relief; (6) Breach of Contract for Failure to Obtain Additional Insured Insurance Coverage; (7) Breach of Contract for Failure to Indemnify, Defend, and Hold Harmless; and (8) Breach of Written Contract.

FACTUAL BACKGROUND Plaintiff alleges that on October 20, 2017, Plaintiff's owner entered into a contractual agreement with California Electric for the ground-up construction of a 34-unit apartment building located at 7140 La Tijera Boulevard in Los Angeles, California (the "Subject Property"). (Complaint, P. 12.) Plaintiff alleges that the parties' contract specified that completion of the project would take no longer than 18 months from the date of commencement. (Complaint, P. 12.) Plaintiff alleges that on December 24, 2022, after California Electric and Carbajal completed construction and installation of the Subject Property's roof and waterproofing, rain water leaked into the Subject Property, damaging 15 of the 34 apartment units. (Complaint, P. 16.)

Plaintiff alleges that Defendants' negligent construction and waterproofing caused rain to leak into the Subject Property. (Complaint, P. 17.) Plaintiff further alleges that it has experienced additional construction defects including loose tiles, cracked stucco and concrete, cracks in the stairs, rain water leaks in the garage, and substandard waterproofing. (Complaint, P. 18.) LEGAL STANDARD A request for equitable relief based on extrinsic fraud or mistake may be brought at any time, so long as the party acted diligently in seeking relief. (Rappleyea v.

Campbell (1994) 8 Cal.4th 975, 982.) "A party seeking relief under the court's equitable powers must satisfy the elements of a 'stringent three-pronged test': (1) a

satisfactory excuse for not presenting a defense, (2) a meritorious defense, and (3) diligence in seeking to set aside the default." (Kramer v. Traditional Escrow, Inc. (2020) 56 Cal.App.5th 13, 29.) "Extrinsic mistake occurs when circumstances extrinsic to the litigation have unfairly cost a party a hearing on the merits. In contrast with extrinsic fraud, extrinsic mistake exists when the ground of relief is not so much the fraud or other misconduct of one of the parties as it is the excusable neglect of the defaulting party to appear and present his claim or defense.

If that neglect results in an unjust judgment, without a fair adversary hearing, the basis for equitable relief on the ground of extrinsic mistake is present. Relief will be denied, however, if the complaining party's negligence permitted the fraud to be practiced or the mistake to occur." (Kramer, supra, 56 Cal.App.5th at 30.) DISCUSSION Moving Party's Argument California Electric seeks an order setting aside the entry of default entered against it on Carbajal's cross-complaint on the grounds of extrinsic mistake.

California Electric argues that its failure to respond to Carbajal's cross-complaint was the result of extrinsic mistake because California Electric's prior defense counsel had been withdrawn, and thus California Electric did not have active legal representation for the purposes of responding to Carbajal's cross-complaint. California Electric argues that it did not understand that it was required to file a responsive pleading to the cross-complaint by the applicable deadline and did not understand that failure to do so could result in the entry of default.

California Electric argues that it acted diligently after counsel resumed its defense on May 22, 2026, because California Electric's counsel promptly requested a stipulation to set aside the default. California Electric argues that it possesses a meritorious defense because it concurrently submits a copy of its proposed answer to Carbajal's cross-complaint and a copy of California Electric's own cross-complaint. Finally, California Electric argues that setting aside the default will not prejudice Carbajal.

Opposing Party's Argument Carbajal argues that California Electric has failed to show extrinsic mistake because California Electric received proper service of Carbajal's cross-complaint and has not provided facts showing why it was difficult for California Electric to understand its responsibility to respond to the cross-complaint. Carbajal argues that ignorance of the law is not a satisfactory excuse, and here, California Electric's designated agent for service of process received proper service.

Carbajal argues that California Electric has not established that it was diligent because the moving papers do not state when California Electric learned of the default or explain California Electric's post-default delay. Next, Carbajal argues that California Electric has not identified a meritorious defense because the moving papers do not identify concrete factual or legal defenses to Carbajal's cross-complaint. Reply Argument California Electric argues that it did not deliberately ignore Carbajal's cross-complaint, but rather it was deprived of a meaningful opportunity to present its defenses because no active defense counsel was representing California Electric when the response deadline passed.

California Electric reiterates its arguments that it acted diligently once counsel resumed representing it and argues that its proposed answer to the cross-complaint satisfies the "meritorious defense" requirement. California Electric next argues that its motion does not rely upon a challenge to service. Finally, California Electric argues that Carbajal has not identified any prejudice that would result from setting aside the default. Merits of the Motion California Electric moves for an order setting aside the entry of default against California Electric on Carbajal's cross-complaint on the grounds of extrinsic mistake.

California Electric's authorized representative, Nahum Mizrahi ("Mizrahi") declares that on February 20, 2024, California Electric's defense counsel was withdrawn by its insurance carrier, and during the period after counsel's withdrawal, California Electric "did not have legal representation for the purposes of responding to the cross-complaint." (Mizrahi Decl., P.P. 7-8.) Mizrahi declares that the deadline for California Electric's response to Carbajal's cross-complaint occurred during the time period in which California Electric did not have active legal representation, and California Electric "did not understand that a responsive pleading to the cross-complaint was required, and did not understand the procedural consequences of failing to file a timely response." (Mizrahi Decl., P.P. 9-10.)

In opposition, Carbajal argues that ignorance of the law does not constitute sufficient grounds to set aside the entry of default for extrinsic mistake. The court agrees. "Although the policy of the law is to favor a hearing on the merits of a case, courts are not required to set aside default judgments for defendants who flagrantly ignore the responsibility to present a defense. The burden of a party who has had a default entered against him is not limited to merely articulating the existence of a meritorious case.

The defendant must also demonstrate a satisfactory excuse for not responding to the original action in a timely matter. [Citation.]" (Stiles v. Wallis (1983) 147 Cal.App.3d 1143, 1148.) As observed by Carbajal, here, the proof of service of Carbajal's cross-complaint shows that service was made on Mizrahi, California Electric's agent for service of process. The court finds that California Electric has not established excusable neglect to respond to the cross-complaint, instead stating only that California Electric "did not understand that a responsive pleading to the cross-complaint was required," while it was properly served through its agent for service of process. (Mizrahi Decl., P. 10.)

That declaration is insufficient as it does not explain why the declarant arrived at that conclusion. Therefore, the court finds that California Electric has not demonstrated a satisfactory excuse for failing to respond to Carbajal's cross-complaint in a timely manner. (Stiles, supra, 147 Cal.App.3d at 1148.) Accordingly, the court concludes that California Electric has not met its burden, and the court declines to exercise its equitable powers to grant relief here. The court notes that the moving papers refer to the policy of Code of Civil Procedure Section 473(b) "[a]lthough Cross-Defendant's motion is framed as an equitable motion for relief based on extrinsic mistake." (Mot. 6:26-27.)

If California Electric had brought its motion pursuant to Code of Civil Procedure Section 473(b), the court would have found the instant motion to be untimely. Code of Civil Procedure Section 473(b) provides, in relevant part: "The court may, upon any terms as may be just, relieve a party or his or her legal representative from a judgment, dismissal, order, or other proceeding taken against him or her through his or her mistake, inadvertence, surprise, or excusable neglect. Application for this relief shall be accompanied by a copy of the answer or other pleading proposed to be filed therein, otherwise the application shall not be granted, and shall be made within a reasonable time, in no case exceeding six months, after the judgment, dismissal, order, or proceeding was taken."

Here, default was entered against California Electric on Carbajal's cross-complaint on December 3, 2025, yet California Electric did not file the instant motion until July 10, 2026, more than six months later. Therefore, Code of Civil Procedure Section 473(b) does not offer independent grounds for relief. Accordingly, California Electric's Motion to Set Aside Entry of Default is DENIED. CONCLUSION Based on the foregoing, California Electric's Motion to Set Aside Entry of Default is DENIED. Moving party is ordered to give notice of ruling. | Home -->)" -->