Manuel Nunez, et al. v. Jose Luis Esparza

Case Number

Case Type Civil Law & Motion Hearing Date / Time Fri, 09/04/2026 - 10:00 Nature of Proceedings Motion to Set Aside Entry of Default Tentative Ruling For the reasons stated herein, the motion of defendant Jose Luis Esparza to set aside entry of default is granted, in part. The court orders the default of defendant entered on April 27, 2026, and the court judgment by default entered on June 16, 2026, vacated. On or before September 11, 2026, defendant shall file and serve, and file proof of service of, the "Notice of Demurrer and Demurrer to Plaintiff's Complaint" in the form submitted as exhibit A to the declaration of defendant's counsel of record, John J. Thyne III, filed in support of the motion. Except as herein granted, the motion is otherwise denied without prejudice.

Background:

As alleged in the complaint of plaintiffs Manuel Nunez (M Nunez) and Linda Nunez (L Nunez) (collectively, Plaintiffs): In the year 2000, L Nunez's mother passed away and left Plaintiffs property located at 323 S. Canada Street in Santa Barbara, California (the Property). Plaintiffs elected to let their daughter and son reside at the Property. As Plaintiffs grew older and needed to be closer to family and medical facilities, Plaintiffs decided to pay for modifications to the Property so that Plaintiffs could move there.

On September 30, 2020, Plaintiffs retained licensed architect Jose L. Esparza (Esparza) to prepare plans for the addition of two bedrooms and a bathroom to the Property. At the first meeting with Esparza, the issue of the Property being located in a flood zone was discussed. Plaintiffs and Esparza agreed that if the house at the Property had to be raised in order to meet applicable flood zone requirements, the additional cost would be prohibitive and Ezparza would not start on the plans.

On October 9, 2020, Esparza advised Plaintiffs that the Property was located in the flood zone but that the house did not have to be raised. Based on Esparza's advice, Plaintiffs agreed to have plans made for the construction of two bedrooms and bathroom elevated above the regular foundation height. Though Esparza knew or should have known that the entire house and not just the additions would have to be raised, Esparza proceeded to draw up construction plans.

On or about August 7, 2021, after the work at the Property had commenced, an inspector at the site informed Oliver Rubio (Rubio), M Nunez's nephew who was working on the house, that the house had to be raised in order to build the additional bedrooms and bathroom. After receiving this information, Plaintiffs and Rubio confronted Esparza regarding the additional cost to raise the house and Esparza's failure to inform Plaintiffs that the entire house had to be raised. Esparza admitted that he had failed to inform Plaintiffs of this fact and agreed in writing to pay $11,000 to offset part of the cost to raise the house. Relying on that agreement, Plaintiffs and Rubio continued to work on the project.

On October 29, 2021, Esparza presented Plaintiffs with a modified agreement that negated the prior agreement described above by changing the payment arrangement and requiring additional terms to be met before any funds would be paid by Esparza. After Esparza handed the new agreement to M Nunez who handed the agreement to L Nunez to review, Esparza grabbed it from L Nunez and terminated his professional relationship with Plaintiffs.

Facing the financial choice to either pay a contractor to finish reconstructing the foundation to meet the requirements of the city and FEMA, or to pay to put the house back on the existing foundation with new anchor bolts thereby abandoning the additions, Plaintiffs elected to pay $40,000 to raise the house high enough to meet the city and FEMA requirements. After paying $64,683 in architectural and engineering fees and costs to raise the foundation, Plaintiffs realized they had insufficient funds left to build the additional two bedrooms and bathroom which was the purpose of the project. As a result, Plaintiffs expended $64,683 to raise the house, which was no longer necessary because the two bedrooms and bathroom were never completed.

On September 29, 2025, Plaintiffs filed their complaint against defendant Esparza, asserting two causes of action: (1) intentional breach of fiduciary duty; and (2) negligent breach of fiduciary duty. On April 27, 2026, the default of Esparza was entered as requested by Plaintiffs. On May 29, 2026, Esparza filed a motion to set aside the entry of default and any subsequent judgment (the Set Aside Motion). On June 11, 2026, Plaintiffs filed a request for court judgment by default against Esparza. On June 16, 2026, the court entered judgment by default against Esparza, in the total amount of $68,402. On June 18, 2026, Esparza filed an objection to the request for court judgment filed by Plaintiffs on June 11. On August 24, 2026, Plaintiffs filed an opposition to the Set Aside Motion.

Analysis:

Code of Civil Procedure section 473 "provides for both discretionary and mandatory relief." (Pagnini v. Union Bank, N.A. (2018) 28 Cal.App.5th 298, 302.) Under the discretionary provision of that statute, "[t]he court may, upon any terms as may be just, relieve a party ... from a judgment, dismissal, order, or other proceeding taken against the party through the party's mistake, inadvertence, surprise, or excusable neglect." (Code Civ. Proc., Sec. 473, subd. (b); Lorenz v. Commercial Acceptance Ins.

Co. (1995) 40 Cal.App.4th 981, 989, original italics.) "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." (Code Civ. Proc., Sec. 473, subd. (b).)

"Although a trial court has discretion to vacate the entry of a default or subsequent judgment, this discretion may be exercised only after the party seeking relief has shown that there is a proper ground for relief, and that the party has raised that ground in a procedurally proper manner, within any applicable time limits." (Cruz v. Fagor America, Inc. (2007) 146 Cal.App.4th 488, 495.) The party moving for relief under the discretionary provision of Code of Civil Procedure section 473 bears the "burden to demonstrate 'that due to some mistake, either of fact or of law, of himself ..., or through some inadvertence, surprise or neglect which may properly be considered excusable, the judgment or order from which he seeks relief should be reversed.' [Citation.]" (Hopkins & Carley v. Gens (2011) 200 Cal.App.4th 1401, 1410, original italics.)

Under the mandatory provision of Code of Civil Procedure section 473, "the court shall, whenever an application for relief is made no more than six months after entry of judgment, is in proper form, and is accompanied by an attorney's sworn affidavit attesting to the attorney's mistake, inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk against the attorney's client, and which will result in entry of a default judgment, or (2) resulting default judgment or dismissal entered against the attorney's client, unless the court finds that the default or dismissal was not in fact caused by the attorney's mistake, inadvertence, surprise, or neglect." (Code Civ. Proc., Sec. 473, subd. (b).)

" 'The range of attorney conduct for which relief can be granted in the mandatory provision is broader than that in the discretionary provision, and includes inexcusable neglect.' [Citation.] The purposes of the mandatory relief provision is to promote the determination of actions on their merits, to relieve innocent clients of the burden of the attorneys' fault, to impose the burden on the erring attorney, and to avoid the precipitation of additional litigation in the form of malpractice suits." (Gee v. Greyhound Lines, Inc. (2016) 6 Cal.App.5th 477, 492.) "[I]f the prerequisites for the application of the mandatory provision of section 473, subdivision (b) exist, the trial court does not have discretion to refuse relief." (Leader v. Health Industries of America, Inc. (2001) 89 Cal.App.4th 603, 612.)

The Set Aside Motion is supported by a declaration of counsel for Esparza, John J. Thyne, III, (attorney Thyne), who states that upon their receipt of the complaint, they sent an email to Plaintiff's counsel on April 1, 2026, pursuant to California Code of Civil Procedure section 430.10, explaining why the claims were untimely and subject to demurrer. (Thyne Dec., P.P. 3, 4.) On April 17, Plaintiff's counsel sent a paralegal to meet with attorney Thyne. (Thyne Dec., P. 5.) Following an unsuccessful session, attorney Thyne drafted a demurrer that they intended to provide Plaintiff's counsel to further the meet and confer efforts prior to filing the demurrer. (Thyne Dec., P. 6.)

On April 24, attorney Thyne received a copy of the request for entry of default filed by Plaintiffs. (Thyne Dec., P.P. 7, 8.) Attorney Thyne immediately sent an email to Plaintiff's counsel asserting that it was sanctionable misconduct to request default against a represented party without first contacting that party's attorney, and providing case law to support that point. (Thyne Dec., P. 8.) Though attorney Thyne gave Plaintiffs several days to rescind the request for entry of default, Plaintiffs' counsel failed to respond to attorney Thyne's email. (Ibid.)

On April 28, having received no withdrawal of the request for entry of default, attorney Thyne again wrote to Plaintiff's counsel requesting that withdrawal and advising that Esparza would file a motion to set aside the default and for sanctions. (Thyne Dec., P. 9.) Attorney Thyne contacted the court and held the date of September 4, 2026, for that motion. (Ibid.) Plaintiffs' counsel failed to respond to attorney Thyne's email. (Ibid.)

On May 5, 2026, when attorney Thyne looked at the online court filings and realized that no judgment for default had been entered, attorney Thyne submitted a demurrer for filing, a copy of which is attached to the Thyne declaration. (Thyne Dec., P. 10 & exhibit A.) Attorney Thyne also provided Plaintiffs' counsel with a copy of that demurrer and explained that if the demurrer was accepted for filing, then the September 4, 2026, hearing date would be on the demurrer. (Thyne Dec., P. 10.) Attorney Thyne also explained that if the demurrer was rejected then the motion to set aside the default would instead proceed on that hearing date. (Ibid.) Plaintiffs' counsel failed to respond to that email and on May 6, the court rejected the filing of the demurrer due to the request for entry of default. (Thyne Dec., P.P. 10, 11.)

The opposition of Plaintiffs to the Set Aside Motion is supported by a declaration of Plaintiffs' counsel, Nancy K. Undem (attorney Undem). That declaration presents no information to dispute, and appears to concede, that on April 1, they were notified of attorney Thyne's representation of Esparza, and that the parties met and conferred on April 17 in regard to Esparza's intent to file a demurrer to Plaintiffs' complaint. (Undem Dec., P. 4.) Attorney Undem states that, because they are located in San Diego, they asked paralegal Leo Federman (paralegal Federman) if he would attend a meet and confer at attorney Thyne's office to discuss the facts of this case. (Undem Dec., P. 5.)

Attorney Undem advised attorney Thyne that they would be available by phone. (Ibid.) Prior to that meeting, attorney Undem instructed paralegal Federman to offer Esparza a one week extension of time to file the demurrer. (Ibid.)

At the April 17 meeting with attorney Thyne, paralegal Federman advised that a response to the complaint was due on April 20, 2026. (Undem Dec., P. 6.) Attorney Undem asserts that attorney Thyne did not request, and rejected paralegal Federman's offer of, an extension of time to file the demurrer. (Ibid.) The opposition of Plaintiffs is also supported by declaration of paralegal Federman, who effectively repeats the information contained in attorney Undem's declaration and described above. Paralegal Federman also states that, at the conclusion of the meeting on April 17, it was determined that attorney Thyne would file a demurrer since no agreement to dismiss the complaint was reached. (Federman Dec., P. 3.)

Paralegal Federman further asserts that they advised attorney Thyne that the demurrer was due on April 20, 2026; and that attorney Thyne did not request any extension of time to file the demurrer notwithstanding paralegal Federman's offer of an additional week. (Federman Dec., P. 4.)

"The obligation to advise opposing counsel of an impending default is part of an attorney's responsibility to the court and the legal profession and takes precedence over the obligation to represent the client effectively." (Shapell Socal Rental Properties, LLC v. Chico's FAS, Inc. (2022) 85 Cal.App.5th 198, 213 (Shapell).) "So to the extent it was possible for a party seeking a default with unseemly haste to commit an ethical breach without creating a legal issue, that distinction was erased by [Code of Civil Procedure] section 583.130." (Lasalle v. Vogel (2019) 36 Cal.App.5th 127, 137 (Lasalle), original italics.)

That statute provides: "It is the policy of the state that a plaintiff shall proceed with reasonable diligence in the prosecution of an action but that all parties shall cooperate in bringing the action to trial or other disposition. Except as otherwise provided by statute or by rule of court adopted pursuant to statute, the policy favoring the right of parties to make stipulations in their own interests and the policy favoring trial or other disposition of an action on the merits are generally to be preferred over the policy that requires dismissal for failure to proceed with reasonable diligence in the prosecution of an action in construing the provisions of this chapter." (Code Civ. Proc., Sec. 583.130.)

"The ethical obligation to warn opposing counsel of an intent to take a default is now reinforced by a statutory policy that all parties 'cooperate in bringing the action to trial or other disposition.' [Citation.] Quiet speed and unreasonable deadlines do not qualify as 'cooperation' and cannot be accepted by the courts. "We cannot accept it because it is contrary to legislative policy and because it is destructive of the legal system and the people who work within it. Allowing it to flourish has been counterproductive and corrosive.

First, it has led to increased litigation. Unintended defaults inevitably result in motions to overturn them (this case, exemplary in no other way, demonstrates well the resources consumed by such motions) or lawsuits against the defaulted party's attorney (who thought enough of his client's position to agree to represent him and then bungled it). There are plenty of demands on our legal resources without adding such matters. "But worse than that, it forces practitioners to sail between Scylla and Charybdis.

They are torn between the civility we teach in law schools, require in their oath, and legislate in statutes like section 583.130, and their obligation to represent their client as effectively as possible. We ask too much of people with families and mortgages - not to mention ex-spouses who fail to make tax and mortgage payments - when we ask them to choose 'dignity, courtesy, and integrity' over easy 'fish in a barrel' victories that are perceived to have statutory support. We owe ourselves an easier choice, and the legislature has given it to us in [Code of Civil Procedure] section 583.130." (Lasalle, supra, 36 Cal.App.5th at p. 137.)

The available evidence and information described above shows, without reasonable dispute, that at the time Plaintiffs sought the entry of a default and default judgment against Esparza, Plaintiffs and their counsel knew that Esparza was represented by attorney Thyne. Furthermore, even if Plaintiffs could present information sufficient to show that the demurrer was not filed within the time prescribed in Code of Civil Procedure section 430.40, subject to any extensions of time available under section 430.41 (and the court makes no findings in that regard), neither attorney Undem nor paralegal Federman state in their respective declarations that that they communicated with attorney Thyne "about the intent to file the request for entry of default and default judgment." (Shapell, supra, 85 Cal.App.5th at p. 214.)

There also exist concerns in regard to what appears to be a refusal by Plaintiffs and their counsel "to acknowledge any duty to notify counsel for [Esparza] before taking [Esparza's] default[.]" (Shapell, supra, 85 Cal.App.5th at pp. 214-215.) For example, in the opposition, Plaintiffs do not address whether, and appear to dispute, "that an attorney has both an ethical and a statutory obligation to warn opposing counsel of an impending default." (Ibid.) Instead, Plaintiffs argue that, after being "reminded" that the demurrer was due on April 20, attorney Thyne "did not request an extension"; "rejected a one week extension offered by [P]laintiffs' counse[l]"; and "elected to sit back and wait until [P]laintiffs notified him of their intent to file a request for default, hoping [P]laintiffs would miss the ten day deadline to file the request for entry of default under California Rules of Court, Rule 3.110(h)." (Opp. at p. 8, l. 19-p. 9, l. 2.)

The court also questions whether Plaintiffs were subject to the deadline cited in the opposition. For example, California Rules of Court, rule 3.110(h), provides: "When a default is entered, the party who requested the entry of default must obtain a default judgment against the defaulting party within 45 days after the default was entered, unless the court has granted an extension of time." (Cal. Rules of Court, rule 3.110(h).) That rule does not apply to, or prescribe a 10 day deadline to file, a request for the entry of default.

Moreover, the present record reflects that an "extension of time [was] granted" to file a responsive pleading. (Cal. Rules of Court, rule 3.110(g).) Furthermore, considering the parties' communications described above, Plaintiffs do not address whether they requested from the court an extension of time to obtain a default judgment, or whether such a request would have been appropriate under the circumstances present here.

The filing by Plaintiffs of the request for entry of default 7 days after the purported deadline by which Plaintiffs contend Esparza was required to file a demurrer to the complaint also suggests that Plaintiffs "sought entry of default and default judgment, in a manner precisely calculated to keep [Esparza] in the dark about what was going on and to produce a substantial possibility of a default." (Shapell, supra, 85 Cal.App.5th at p. 217.) In addition, the purposes of Code of Civil Procedure section 473, subdivision (b), "are advanced as long as mandatory relief is confined to situations in which the attorney, rather than the client, is the cause of the default," (Martin Potts & Associates, Inc. v.

Corsair, LLC (2016) 244 Cal.App.4th 432, 439.) There is no evidence or information which would suggest that Esparza "caused the entry of default." (Dollase v. Wanu Water, Inc. (2023) 93 Cal.App.5th 1315, 1327.)

The opposition to the Set Aside Motion also does not "identify any prejudice [Plaintiffs] might suffer if the default [or default] judgment were set aside." (Shapell, supra, 85 Cal.App.5th at p. 217.) A review of the allegations of Plaintiffs' complaint and the causes of action asserted in that pleading also indicates or suggests that this case is not "suited for default[.]" (Lasalle, supra, 36 Cal.App.5th at p. 139.) For example, this case does not involve "simple debt collection." (Lasalle, supra, 36 Cal.App.5th at p. 139.) Instead, the causes of action asserted in the complaint require litigation of relatively complex issues which require Plaintiffs to prove, among other things, "the existence of a fiduciary relationship ...." (Mendoza v. Continental Sales Co. (2006) 140 Cal.App.4th 1395, 1405; Complaint at pp. 7 & 9.)

Generally, fiduciary relationships "are relationships existing between parties to a transaction wherein one party is duty bound to act with the utmost good faith for the benefit of the other. Such a relationship ordinarily arises when one party reposes a confidence in the integrity of the other, and the other voluntarily accepts that confidence." (Brown v. Wells Fargo Bank, N.A. (2008) 168 Cal.App.4th 938, 960.) An agreement to prepare architectural plans "standing alone, does not give rise to a fiduciary duty." (City of Hope National Medical Center v. Genentech, Inc. (2008) 43 Cal.4th 375, 391.) For these reasons, there exists some question as to whether the nature of the claims in this case are suited for default. (Lasalle, supra, 36 Cal.App.5th at p. 139.)

The filing of the Set Aside Motion approximately one month after the entry of Esparza's default is also sufficient to demonstrate "the relative speed with which" Esparza acted (Shapell, supra, 85 Cal.App.5th at p. 217), "given the relatively short time between [Plaintiffs] seeking the default and [Esparza] asking to be relieved from it (Lasalle, supra, 36 Cal.App.5th at pp. 138-139). The court also does not fault Esparza's counsel for any delay in filing the Set Aside Motion pending a response from Plaintiffs' counsel as to whether or not Plaintiffs would withdraw the request for entry of default. The Set Aside Motion is also accompanied by a copy of the demurrer Esparza proposes to file. For these reasons, the court finds that Esparza has substantially complied with Code of Civil Procedure section 473. (Los Angeles County v. Lewis (1918) 179 Cal. 398, 400 [general discussion].)

"The policy of the law is to have every litigated cause tried on its merits; and it looks with disfavor on a party who, regardless of the merits of his cause, attempts to take advantage of the mistake, surprise, inadvertence, or neglect of his adversary." (Reed v. Williamson (1960) 185 Cal.App.2d 244, 248.) "When the moving party promptly seeks relief and there is no prejudice to the opposing party, very slight evidence is required to justify relief." (Mink v. Superior Court (1992) 2 Cal.App.4th 1338, 1343.) Further, " 'any doubts in applying section 473 must be resolved in favor of the party seeking relief from default [citations]. ...' [Citations.]" (Rappleyea v. Campbell (1994) 8 Cal.4th 975, 980.)

For these and all further reasons discussed above, and as the court does not find that the conduct of attorney Thyne fell below a professional standard of care (Zamora v. Clayborn Contracting Group, Inc. (2002) 28 Cal.4th 249, 258), the court will grant the Set Aside Motion, in part, and order that the default of Esparza entered on April 27 be vacated. The Set Aside Motion also seeks an order vacating any default judgment entered against Esparza as a result of the default. For the same reasons discussed above, the court will order that the court judgment by default entered on June 16, 2026, be vacated. (Cisneros v. Vueve (1995) 37 Cal.App.4th 906, 910-912.) In addition, the court will require Esparza to file and serve the demurrer to Plaintiff's complaint in the form attached as exhibit A to the declaration of attorney Thyne submitted in support of the Set Aside Motion.

The Set Aside Motion also requests an order awarding sanctions under Code of Civil Procedure section 128.5, which provides: "A trial court may order a party, the party's attorney, or both, to pay the reasonable expenses, including attorney's fees, incurred by another party as a result of actions or tactics, made in bad faith, that are frivolous or solely intended to cause unnecessary delay." (Code Civ. Proc., Sec. 128.5, subd. (a).) "A motion for sanctions under this section shall be made separately from other motions or requests and shall describe the specific alleged action or tactic, made in bad faith, that is frivolous or solely intended to cause unnecessary delay." (Code Civ. Proc., Sec. 128.5, subd. (f)(1)(A).)

As the request for sanctions under section 128.5 is not made separately from the motion or request to set aside the default and default judgment entered against Esparza, that request is procedurally inappropriate. For these and all further reasons discussed above, the court will deny the Set Aside Motion to the extent that motion includes a request for an order awarding sanctions under Code of Civil Procedure section 128.5. The court's ruling herein is without prejudice to any future noticed motion for sanctions under that section that may be filed by Esparza in the future, if appropriate. Furthermore, the court's ruling herein shall not be interpreted as an indication of the manner in which the court may or intends to determine any such motion for sanctions that may be filed by Esparza in the future.

Tentative Ruling: RUTH NAREZ V. SANTA BARBARA COUNTY EMPLOYEE RETIREMENT SYSTEM, ET AL. Tentative Ruling: RUTH NAREZ V. SANTA BARBARA COUNTY EMPLOYEE RETIREMENT SYSTEM, ET AL.