Filed 12/6/23 The Liu Bunch v. Song CA2/3

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on 

opinions not certified for publication or ordered published, except as specified by rule 

8.1115(b). This opinion has not been certified for publication or ordered published for 

purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION THREE

THE LIU BUNCH, LLC,

Plaintiff and Appellant,

v.

KI JONG SONG et al.,

Defendants and Respondents.

B321457

(Los Angeles County

Super. Ct. No. BC453717)

APPEAL from an order of the Superior Court of 

Los Angeles County, Kenneth R. Freeman, Judge. Reversed and 

remanded with directions.

Zee Law Group, Tappan Zee and Kimberly Barrientos for

Plaintiff and Appellant.

Lagasse Branch Bell + Kinkead, Christopher C. Cianci for 

Defendants and Respondents.
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The Liu Bunch, LLC appeals from an order vacating a 2011 

default judgment entered in its favor against Ki Jong Song and 

Mi Sook Song. The trial court found The Liu Bunch, a foreign 

limited liability company, did not have a certificate of registration 

to transact business in California when the judgment was 

entered, and therefore lacked legal capacity to maintain the 

lawsuit. The court accepted the Songs’ argument that the 

judgment was void on its face. We conclude this was error and 

reverse.

FACTUAL AND PROCEDURAL BACKGROUND

In 2006, the Songs received a loan of $1.09 million from 

nonparty Union Bank N.A. (Union Bank) secured by a deed of 

trust to real property located in Nevada. Union Bank assigned 

the loan to The Liu Bunch in 2010. By October 2010, the Songs 

owed more than $50,000 in outstanding payments on the loan. 

The Liu Bunch filed a complaint against the Songs in January 

2011 asserting claims for breach of contract, money due on an 

open book account, and money due on an account stated. The 

Songs did not respond to the complaint. The court entered a 

default judgment in favor of The Liu Bunch in August 2011. The 

court granted The Liu Bunch’s application to renew the judgment 

in June 2021.

In November 2021, the Songs filed a motion to set aside the 

judgment. The Songs argued The Liu Bunch was not properly 

registered with the California Secretary of State as a foreign 

Limited Liability Company (LLC). The Songs contended The Liu 

Bunch was therefore “not qualified” to maintain the lawsuit 

based on Corporations Code section 17708.07, subdivision (a).
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The Songs asked the court to set aside the judgment as void 

under Code of Civil Procedure section 473, subdivision (d).

1 They

also filed a request for judicial notice of a printout from the 

Secretary of State website showing no results for a search for an 

LLC with the name “liu bunch.”

The Liu Bunch opposed the Songs’ motion in March 2022. 

The opposition argued that any challenge to The Liu Bunch’s 

registration status should have been raised by demurrer; the trial

court should stay the case pending its registration rather than 

invalidate the judgment; a judgment is void when the trial court 

lacks subject matter or personal jurisdiction, and here the 

complaint was properly served; and any invalidity must appear 

on the face of the judgment and may not be established solely 

through extrinsic evidence. The opposition attached a copy of 

The Liu Bunch’s application to register with the Secretary of 

State of California as a foreign LLC dated March 8, 2022.

The trial court found The Liu Bunch did not have a 

certificate of registration when it obtained the default judgment, 

thus it lacked legal capacity to maintain the lawsuit. The court 

concluded the judgment was therefore void on its face, granted 

the Songs’ motion, and set aside the default judgment and the 

entry of default. The Liu Bunch timely appealed.

DISCUSSION

The fundamental legal question in this appeal is whether a 

plaintiff’s corporate incapacity at the time of judgment renders 

the judgment void. In its appellate briefing, The Liu Bunch 

contends a judgment is void if the court lacked subject matter or 

personal jurisdiction, and asserts there was no such lack of 

1 All further undesignated statutory references are to the

Code of Civil Procedure.
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jurisdiction in this case. The Liu Bunch did not expressly discuss

whether a lack of capacity is a jurisdictional deficiency. On the 

other hand, the Songs argue the trial court correctly found The 

Liu Bunch lacked capacity, but they do not provide any legal 

authority or reasoning in support of their contention that this

incapacity rendered the judgment void. We invited the parties to 

submit supplemental briefing on the issue of whether, assuming 

The Liu Bunch lacked capacity at the time it obtained the default 

judgment because it had not registered as a foreign LLC, any

lack of capacity rendered the judgment void. Having considered 

the parties’ briefing in its entirety, we conclude the trial court 

erred in finding The Liu Bunch’s asserted lack of capacity 

rendered the judgment void.2

2 The Liu Bunch also argues it was not required to register 

as a foreign LLC because the underlying contract was not an 

intrastate transaction, and contends the motion to set aside the 

judgment was untimely. These arguments were not raised before 

the trial court and we decline to reach them for the first time on 

appeal, particularly given the fact-intensive nature of the former 

argument. (In re Marriage of Brewster & Clevenger (2020) 45 

Cal.App.5th 481, 509–510 [declining to consider for first time on 

appeal allegations that raise new “issues of fact that could be 

altered by the presentation of additional evidence”]; see

Greenwich S.F., LLC v. Wong (2010) 190 Cal.App.4th 739, 767 

[even if new theory raised on appeal is pure question of law court 

has discretion not to consider it].)

The Liu Bunch further contends the trial court erred in 

considering extrinsic evidence because, for purposes of 

section 473, subdivision (d), a judgment must be invalid on its 

face to be set aside. Because we conclude the judgment was not 

void, we need not address this argument.
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I. Standard of Review

The trial court “may, on motion of either party after notice 

to the other party, set aside any void judgment or order.” (§ 473, 

subd. (d).) “We review de novo a trial court’s determination that 

a judgment is void.” (Cruz v. Fagor America, Inc. (2007) 146 

Cal.App.4th 488, 496 (Cruz).)

II. The Trial Court Erred in Finding the Judgment Void

When a foreign LLC fails to comply with registration 

requirements in the Corporations Code, it “lack[s] . . . capacity to 

maintain an action arising out of intrastate business.” (United 

Medical Management Ltd. v. Gatto (1996) 49 Cal.App.4th 1732, 

1740 [addressing parallel requirements for foreign corporations]; 

Corp. Code § 17708.07, subd. (a) [foreign LLC “transacting 

intrastate business in this state shall not maintain an action or 

proceeding in this state unless it has a certificate of registration 

to transact intrastate business in this state”].)

However, a challenge to the validity of an action based on a 

corporate plaintiff’s lack of capacity “ ‘must be raised . . . at the 

Finally, in response to our invitation to submit 

supplemental briefing, the Songs primarily argued that 

irrespective of whether the judgment was void, The Liu Bunch 

could not renew the default judgment due to its lack of capacity. 

This argument is not properly before us. The trial court found 

the Songs’ motion to vacate the renewal of judgment was not 

properly served and, after vacating the default judgment, 

concluded the motion to vacate the renewal of judgment was 

moot. Thus, the trial court never ruled on the later motion, and 

we have no ruling to review on appeal. Moreover, the Songs did 

not include any argument regarding the motion to vacate the 

renewal of judgment in their opening or reply briefs, and they 

were not invited to address that issue in our request for 

supplemental briefing. We therefore disregard the argument.
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earliest opportunity or it is waived,’ ” and should be raised “ ‘in 

the original answer or by demurrer at the time of the answer.’ ” 

(Color-Vue, Inc. v. Abrams, 44 Cal.App.4th 1599, 1604.) Here, 

the Songs did not file an answer or demur to the complaint. The 

Songs therefore forfeited any argument based on The Liu Bunch’s 

asserted lack of capacity. (Parish v. Peters (1991) 1 Cal.App.4th 

202, 209, fn. 8 [default judgment “permanently precludes the 

filing of an answer”].)

Moreover, a judgment is void “only if the court rendering it 

lacked subject matter jurisdiction or jurisdiction over the 

parties.” (Neumann v. Melgar (2004) 121 Cal.App.4th 152, 164.) 

The Songs’ only basis for seeking to set aside the judgment was 

that The Liu Bunch’s incapacity rendered the judgment void 

under section 473, subdivision (d). Yet, “lack of capacity is not a 

jurisdictional defect,” and an entity’s incapacity at the time of 

judgment does not render the judgment void. (Tabarrejo v.

Superior Court (2014) 232 Cal.App.4th 849, 863.)

For example, in Traub Co. v. Coffee Break Service, Inc.

(1967) 66 Cal.2d 368 (Traub), the cross-complainant, which

lacked capacity due to the suspension of its corporate powers for 

nonpayment of corporate taxes, obtained a judgment against the 

cross-defendants. (Id. at pp. 369–370.) More than a year after 

the judgment was entered, the cross-defendants filed a motion to 

set it aside as void based on the cross-complainant’s incapacity. 

(Ibid.) The trial court denied the motion. (Ibid.) Our Supreme 

Court affirmed, expressly rejecting the argument that the 

judgment was void as a result of the corporation’s incapacity. 

(Ibid.) The court recognized that a judgment may be void for lack 

of jurisdiction, but distinguished between jurisdictional 

deficiencies and incapacity, reasoning that the cross-
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complainant’s lack of capacity at the time of judgment “[did] not 

deprive the court of jurisdiction or render the judgment void and 

subject to collateral attack after it ha[d] become final.” (Id. at 

p. 371.)

Similarly, here, even if The Liu Bunch lacked capacity to 

maintain the lawsuit when the judgment was entered, that 

incapacity did not “deprive the court of jurisdiction or render the 

judgment void.” (Traub, supra, 66 Cal.2d at p. 371.) Rather, 

“lack of capacity . . . results in judicial action ‘in excess of 

jurisdiction,’ ” and “judicial acts in excess of jurisdiction are 

merely ‘voidable.’ ” (Jo Redland Tr., U.A.D. 4-6-05 v. CIT Bank,

N.A. (2023) 92 Cal.App.5th 142, 156.) “Only void judgments and 

orders may be set aside under section 473, subdivision (d); 

voidable judgments and orders may not.” (People v. The North 

River Insurance Co. (2020) 48 Cal.App.5th 226, 234.) Because the 

judgment was not void as a matter of law, the court had “no 

statutory power under section 473, subdivision (d)” to set it aside.

(Cruz, supra, 146 Cal.App.4th at pp. 495–496.) The order must 

be reversed.
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DISPOSITION

The trial court order setting aside the default and default 

judgment is reversed, and the trial court is directed to enter an 

order reinstating the default and default judgment. The matter 

is remanded for further proceedings consistent with this opinion.

Appellant to recover its costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL 

REPORTS

ADAMS, J.

We concur:

EDMON, P. J.

LAVIN, J.