Court Opinion

ID: 9895802
Source: CourtListenerOpinion
Date Created: 2023-11-08 18:04:13.439156+00
Date Added: 2024-06-11T09:11:38.325128
License: Public Domain

Filed 11/8/23 Vardanian v. Volkswagen Group of America CA2/2
   NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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not been certified for publication or ordered published for purposes of rule 8.1115.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 TWO

MARIAM VARDANIAN et al.,                                  B322649

         Plaintiffs and Appellants,                       (Los Angeles County
                                                          Super. Ct. No. 21STCV40574)
         v.
                                                           ORDER MODIFYING
VOLKSWAGEN GROUP OF                                        OPINION
AMERICA, INC.,
                                                           NO CHANGE IN
     Defendant and                                         JUDGMENT
Respondent.

THE COURT:*
     On the court’s own motion and good cause appearing,
     IT IS HEREBY ORDERED that the opinion filed herein on
October 25, 2023, be modified as follows:

         Replace footnote 1 on pages 7-8 with the following footnote:
         1     Appellants argue that Margarian’s mistake of
         signing a dismissal on the wrong case was merely a
         human error and not a mistake of law. However, an
     attorney’s failure to read documents the attorney has
     signed to be filed in court is unprofessional and can
     be sanctionable. (See, e.g., In re White (2004) 121
     Cal.App.4th 1453, 1456-1457 [sanctions appropriate
     where attorney filed frivolous habeas corpus petitions
     and “admitted that before signing them and having
     them filed, he did not even read the petitions”].)
     Counsel clarified at oral argument that he did read
     the filing, but failed to cross-check the case number.
     This factual clarification should have been made to
     the trial court in the first instance so the court could
     have exercised its discretion accordingly.

     The modification does not affect the judgment.

____________________________________________________________
*ASHMANN-GERST, Acting P. J.    CHAVEZ, J. HOFFSTADT, J.

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Filed 10/25/23 Vardanian v. Volkswagen Group of America CA2/2 (unmodified
opinion)
   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 TWO

MARIAM VARDANIAN et al.,                                  B322649

         Plaintiffs and Appellants,                       (Los Angeles County
                                                          Super. Ct. No. 21STCV40574)
         v.

VOLKSWAGEN GROUP OF
AMERICA, INC.,

     Defendant and
Respondent.

     APPEAL from an order of the Superior Court of Los
Angeles County, Malcolm H. Mackey, Judge. Affirmed.
     The Margarian Law Firm, Hovanes Margarian, Armen
Margarian and Shushanik Margarian for Plaintiffs and
Appellants.
     Squire Patton Boggs, Nathaniel K. Fisher, Sean P. Conboy
and Andrew Yu-Chih for Defendant and Respondent.
                             ******
       Mariam Vardanian and Sarkis Kizirian (appellants) appeal
from an order denying their postjudgment motion to vacate
dismissal and reinstate action brought pursuant to Code of Civil
Procedure section 473 (section 473). Appellants argue that the
trial court erred in denying their motion under both the
discretionary and mandatory provisions of section 473,
subdivision (b). We find no error and affirm the order.

                          BACKGROUND
The litigation and settlement
       In December 2018, appellants leased a 2018 Audi A6 (the
vehicle) warranted by respondent Volkswagen Group of America,
Inc. (respondent). After being in appellants’ possession for
several months, appellants observed defects in the vehicle.
Repair facilities authorized by respondent were unable to repair
the defects within a reasonable number of attempts.
       In November 2021, appellants brought claims against
respondent based on alleged design and manufacturing defects in
the vehicle.
       Shortly thereafter, respondent served appellants with an
offer to compromise pursuant to Code of Civil Procedure section
998 (section 998). The offer to compromise provided that
respondent would pay a specified sum to appellants in exchange
for appellants’ transfer of the vehicle back to respondent. The
offer to compromise contained the following provision regarding
appellants’ recovery of costs and attorney fees:
       “[Respondent] will pay [appellants’] costs and expenses
incurred in this action, including [appellants’] attorney’s fees in
the amount of $1,000.00; or, at [appellants’] option, pursuant to

                                 2
Cal. Civil Code § 1794(d) pay a sum equal to the aggregate
amount of costs and expenses, including [appellants’] attorney’s
fees based on actual time expended, determined by the Court to
have been reasonably incurred by the [appellants] in connection
with the commencement and prosecution of this action . . . .”
       Appellants accepted the offer to compromise, in writing, on
December 22, 2021. On January 12, 2022, respondent filed and
served notice of appellants’ acceptance of the offer to compromise.
On February 17, 2022, appellants filed a “Notice of Settlement of
Entire Case,” which noted that dismissal of the case was
conditioned on the satisfaction of specified terms to be performed
within 45 days and that a request for dismissal would be filed no
later than June 10, 2022.
       On March 14, 2022, counsel for respondent received notice
that appellants had surrendered the vehicle, thus satisfying their
obligation under the section 998 agreement. On March 18, 2022,
respondent transferred the settlement funds to appellants.
       According to the declaration of appellants’ attorney
Hovanes Margarian in support of appellants’ motion to vacate
dismissal and reinstate action, on March 25, 2022, Margarian
accidentally marked this case as settled. On March 28, 2022, he
filed a request for dismissal. However, he did not want the
matter to be dismissed. Specifically, Margarian stated: “The
case was accidentally marked as ‘settled.’ As a result, a dismissal
motion was drafted and sent to me for review and my signature.
I was expecting a dismissal motion at this time for another case
and mistakenly assumed this dismissal motion was for that case.
I did not realize that the dismissal motion was for this action. I
did not discover this error until after the case was filed for
dismissal.”

                                 3
       The request for dismissal with prejudice was filed on
March 28, 2022. The dismissal was entered on the same date.
Motion to vacate dismissal and reinstate action
       On May 17, 2022, appellants filed the motion to vacate
dismissal and reinstate action. Attorney Margarian explained
his error, stating that a legal assistant marked the case as settled
and drafted the dismissal motion. “Mr. Margarian, believing this
was a dismissal for a different case for which he was expecting a
dismissal motion, did not read the document, and mistakenly
signed it.” The motion was supported by a declaration from
Attorney Margarian attesting to the events surrounding the
request for dismissal. Appellants sought a ruling that the
dismissal was the result of mistake, surprise, inadvertence and/or
excusable neglect pursuant to section 473, subdivision (b).
       Respondent opposed the motion.
       A hearing took place on June 8, 2022. After the hearing,
the court adopted its tentative ruling denying appellants’ motion.
The court found that the exhibits demonstrated that appellants
intended to resolve the case pursuant to the section 998 offer and
that the accepted offer had been mostly performed. The court
cited Jerry’s Shell v. Equilon Enterprises, LLC (2005) 134
Cal.App.4th 1058, 1074 (Jerry’s Shell) for the proposition that
relief is not mandatory based on counsel’s admission of fault
where counsel made a tactical choice. The court further noted
that “any failure of counsel to read what counsel was signing is
inexcusable for a professional.”
       On August 5, 2022, appellants filed their notice of appeal
from the order after judgment.

                                 4
                           DISCUSSION
I.     Applicable law and standards of review
       Section 473, subdivision (b), contains two distinct
provisions for relief from default. (Even Zohar Construction &
Remodeling, Inc. v. Bellaire Townhouses, LLC (2015) 61 Cal.4th
830, 838.) The first provision “is discretionary and broad in
scope.” (Ibid.) It provides that “[t]he 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.” (§ 473, subd. (b).)
       “‘A ruling on a motion for discretionary relief under section
473 shall not be disturbed on appeal absent a clear showing of
abuse.’” (Zamora v. Clayborn Contracting Group, Inc. (2002) 28
Cal.4th 249, 257 (Zamora).) “‘Discretion is abused whenever, in
its exercise, the court exceeds the bounds of reason, all of the
circumstances before it being considered. The burden is on the
party complaining to establish an abuse of discretion, and unless
a clear case of abuse is shown and unless there has been a
miscarriage of justice a reviewing court will not substitute its
opinion and thereby divest the trial court of its discretionary
power.’” (Denham v. Superior Court (1970) 2 Cal.3d 557, 566.)
       The mandatory provision of section 473, subdivision (b)
provides: “Notwithstanding any other requirements of this
section, 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 his or her mistake, inadvertence, surprise, or neglect,
vacate any (1) resulting default entered by the clerk against his
or her client, and which will result in entry of a default judgment,

                                 5
or (2) resulting default judgment or dismissal entered against his
or her client, unless the court finds that the default or dismissal
was not in fact caused by the attorney’s mistake, inadvertence,
surprise, or neglect.”
       “Whether the mandatory relief provision applies in the
context of a voluntary dismissal such as the one here is a matter
of statutory construction, subject to de novo review.” (Jackson v.
Kaiser Foundation Hospitals, Inc. (2019) 32 Cal.App.5th 166, 173
(Jackson).)
II.    The trial court did not abuse its discretion in
       denying discretionary relief
       The discretionary provision of section 473, subdivision (b)
applies to cases involving attorney mistake “only when the
mistake is excusable.” (Jackson, supra, 32 Cal.App.5th at p. 174.)
“In other words, the discretionary relief provision of section 473
only permits relief from attorney error ‘fairly imputable to the
client, i.e., mistakes anyone could have made.’” (Zamora, supra,
28 Cal.4th at p. 258.) “‘Conduct falling below the professional
standard of care, such as failure to timely object or to properly
advance an argument, is not therefore excusable. To hold
otherwise would be to eliminate the express statutory
requirement of excusability and effectively eviscerate the concept
of attorney malpractice.’” (Ibid.)
       Determinations of whether the order at issue was caused
by the attorney’s mistake, inadvertence, surprise, or neglect “is in
part a credibility determination.” (Cowan v. Krayzman (2011)
196 Cal.App.4th 907, 915.) Here, the trial court found “no
mistake, inadvertence, surprise, attorney fault, or any other
ground is shown to vacate the Request for Dismissal.” The court
noted it was clear that “[appellants’] counsel intended to resolve

                                 6
this case pursuant to the Section 998 offer, the legal assistant
correctly noted the case was settled, and the clients cooperated
with transferring the subject vehicle.” In other words, the court
did not find credible Attorney Margarian’s statement that the
case was “accidentally marked ‘settled.’” Instead, the court found
it was an intentional act, in keeping with appellants’ tactical
decision to accept respondent’s section 998 offer and settle the
matter. The filing of the request for dismissal of the case also
aligned with appellants’ decision to settle the matter, as
appellants had filed a “Notice of Settlement of Entire Case”
informing the court that a request for dismissal would be filed no
later than June 10, 2022.
       Attorney Margarian attested that he was “expecting a
dismissal motion at this time for another case and mistakenly
assumed this dismissal motion was for that case.” Margarian
admitted, “had I read the motion, I would have realized I did not
want to dismiss this action and therefore I would not have
accidentally signed the motion.” The trial court noted that “any
failure of counsel to read what counsel was signing is inexcusable
for a professional.” The trial court did not err in determining
that an attorney’s failure to read a court filing on which the
attorney signed his name was conduct falling below the
professional standard of care. As such, if it was a mistake, it was
not excusable under the discretionary provision of section 473,
subdivision (b). (Zamora, supra, 28 Cal.4th at p. 258.)1

1     Appellants argue that Margarian’s mistake of signing a
dismissal on the wrong case was merely a human error and not a
mistake of law. However, an attorney’s failure to read documents
the attorney has signed to be filed in court is unprofessional and

                                 7
       Appellants argue that the trial court erred in “arbitrarily
concluding” that appellants and appellants’ counsel accepted the
$1,000 attorney fee provision rather than opting for an amount to
be determined by the court pursuant to Civil Code section 1794,
subdivision (d). Appellants argue that the choice was never
made. Appellants point out that the $1,000 had not been paid at
the time the dismissal was filed, but was instead wired by
respondent to appellants’ counsel after the motion to vacate was
filed. Appellants argue the trial court did not take into account
that the amount of actual attorney’s fees exceeded the refund
amount and that respondent had not paid the $1,000 sum.2
       The trial court was aware that the settlement agreement
was not fully performed, noting that the “exchanged emails
show[ed] that the accepted offer already has been mostly
performed.” Appellants cite no law suggesting that a settlement
agreement must be fully performed prior to voluntary dismissal
of the matter. The court was not required to infer from
appellants’ failure to formally opt in to the alternative attorney
fee provision that no choice had been made. Instead, the court
was permitted to infer from the evidence that appellants

can be sanctionable. (See, e.g., In re White (2004) 121
Cal.App.4th 1453, 1456-1457 [sanctions appropriate where
attorney filed frivolous habeas corpus petitions and “admitted
that before signing them and having them filed, he did not even
read the petitions”])
2      Appellants’ counsel returned the $1,000 wired to
appellants’ counsel after the motion to vacate was filed. Thus,
appellants argue, respondents have not paid any attorney’s fees,
costs, or expenses in this matter.

                                8
intentionally dismissed the matter as they were satisfied with
the terms of the agreement.
       Appellants argue that the trial court erred in relying on
Jerry’s Shell, supra, 134 Cal.App.4th 1058 for the proposition
that relief is not available where an attorney has made a tactical
choice. In Jerry’s Shell, the appellants’ counsel engaged in
“obstructionist tactics” such as regularly failing to respond to
discovery when it was due, ignoring attempts by opposing counsel
to meet and confer, and failing to respond to a motion to compel.
(Id. at p. 1073.) After the appellants were subjected to the
ultimate sanction of dismissal, they sought to revive their claims
through section 473, subdivision (b) relief. The Jerry’s Shell court
found that the trial court properly denied such relief, as such
relief would “be rewarding and encouraging this wholly improper
conduct.” (Jerry’s Shell, at p. 1074.) While appellants’ counsel’s
actions in this matter could not be characterized as obstructionist
tactics, the trial court’s decision that the filing of the dismissal
was a tactical decision is supported by the record. Appellants
accepted respondent’s offer, both parties had substantially
performed, and a dismissal was an agreed-upon step in the
process. Under the circumstances, it was within the trial court’s
discretion to deny discretionary relief. We therefore decline to
find error.
III. The trial court properly denied mandatory relief
       Section 473, subdivision (b) restricts the availability of
mandatory relief to a “default judgment or dismissal entered
against” the attorney or his or her client. When enacted in 1988,
the mandatory provision “applied only to default judgments
caused by attorney error.” (Jackson, supra, 32 Cal.App.5th at
p. 174.) In 1992, the Legislature added the term “dismissal” to

                                 9
that provision. (Jackson, at p. 174, citing Stats. 1992, ch. 876,
§ 4, p. 4071.) Courts have interpreted the term “dismissal” in the
mandatory provision to mean “only dismissals which are
procedurally equivalent to a default.” (Peltier v. McCloud River
R.R. Co. (1995) 34 Cal.App.4th 1809, 1817 (Peltier); see Generale
Bank Nederland v. Eyes of the Beholder Ltd. (1998) 61
Cal.App.4th 1384, 1396-1397; Graham v. Beers (1994) 30
Cal.App.4th 1656, 1660-1661; Tustin Plaza Partnership v.
Wehage (1994) 27 Cal.App.4th 1557, 1565-1566.)
       The mandatory relief provision of section 473, subdivision
(b) does not apply to voluntary dismissals. (English v. IKON
Business Solutions, Inc. (2001) 94 Cal.App.4th 130, 142.) “‘The
purpose of the statute was to alleviate the hardship on parties
who lose their day in court due solely to an inexcusable failure to
act on the part of their attorneys. There is no evidence the
amendment was intended to be a catch-all remedy for every case
of poor judgment on the part of counsel which results in
dismissal.’” (Ibid.) Instead, the word “dismissal,” as used in the
mandatory provision of section 473, subdivision (b), has “a limited
meaning similar to the term ‘default judgment.’” (English, supra,
at p. 145.) “Thus, where a defendant was entitled to mandatory
relief from a ‘default’ or ‘default judgment’ resulting from
attorney mistake, inadvertence, surprise, or neglect, a plaintiff
would be entitled to mandatory relief from a ‘dismissal’ resulting
from similar circumstances.” (Ibid.) “[T]he mandatory provision
does not apply to: (1) a dismissal following the sustaining of a
demurrer without leave to amend on the ground the statute of
limitations had run [citation]; (2) a voluntary dismissal pursuant
to a settlement agreement [citation]; and (3) a mandatory

                                10
dismissal for failure to serve a complaint within three years
[citation].” (Id. at p. 146.)3
       Huens v. Tatum (1997) 52 Cal.App.4th 259 (Huens)
criticized on other grounds in Zamora, supra, 28 Cal.4th at page
256, directly addressed the question of whether the mandatory
provision of section 473, subdivision (b) applies to a voluntary
dismissal entered pursuant to a settlement agreement. The
plaintiff voluntarily dismissed her personal injury action after
settling with the defendants. (Huens, at p. 261.) Shortly
thereafter, she moved to vacate the dismissal under both the
discretionary and mandatory provisions of section 473,
subdivision (b). (Huens, at p. 262.) The Huens court upheld the
denial of mandatory relief, finding that “the mandatory ‘attorney
affidavit’ provisions of section 473 cannot be used to set aside a
voluntary dismissal executed pursuant to a settlement.” (Huens,
at p. 265.)4 The reasoning of Huens and the other cases discussed

3     Solv-All v. Superior Court (2005) 131 Cal.App.4th 1003,
1006, involved a default judgment entered against debtors where
the deadline to respond to the plaintiff’s complaint passed due to
a miscommunication between the parties during negotiations to
resolve the complaint. Because the case involved a default
judgment—not a voluntary dismissal entered pursuant to
settlement—it is inapplicable.
4     The Huens court also noted that “[s]ettlements are
contracts. To set them aside, one must present contractual
grounds for rescission . . . . Applying section 473 in the manner
suggested here would constitute a serious intrusion into contract
law by allowing a party to escape the consequences of his
agreement upon the mere affidavit of his attorney that he had
made an inexcusable error concerning the applicable facts or law.
It would also undermine our strong public policy in favor of

                                11
above restricting the mandatory provision of section 473,
subdivision (b) to “only dismissals which are procedurally
equivalent to a default,” is persuasive. (Peltier, supra, 34
Cal.App.4th at p. 1817.) Relief from the voluntary dismissal filed
in this matter is not available under the mandatory provision.
       Appellants argue that they met the criteria for mandatory
relief under section 473, subdivision (b) because Margarian
submitted his declaration under penalty of perjury. Appellants
fail to address the law detailed above holding that the mandatory
provision of section 473, subdivision (b) does not apply to
voluntary dismissals filed pursuant to settlement. In the absence
of contrary legal authority, we find that the mandatory provision
of section 473, subdivision (b) is inapplicable under the
circumstances of this case.5

settlements. [Citations.] We believe the Legislature did not
intend such drastic consequences to flow from such a
‘noncontroversial’ amendment.” (Huens, supra, 52 Cal.App.4th at
pp. 264-265.)
5     For the first time in their reply brief, appellants cite
Wohlgemuth v. Caterpillar Inc. (2012) 207 Cal.App.4th 1252 for
the proposition that a dismissal with prejudice pursuant to a
section 998 offer does not bar a plaintiff from recovering attorney
fees as the prevailing party in a Song-Beverly Act case.
(Wohlgemuth, at pp. 1263-1265.) Based on Wohlgemuth,
appellants state: “Thus, this Court shall remand the case and
award [a]ppellants their right to further litigate in order to
request their attorney’s fees, costs, and expenses.” In
Wohlgemuth, the plaintiffs “filed a motion for attorney fees and
costs under the provisions of the Song-Beverly Act” following the
entry of the dismissal with prejudice. (Wohlgemuth, at p. 1257.)
The Wohlgemuth court held that the plaintiffs’ voluntary

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                        DISPOSITION
     The order is affirmed. Respondent is awarded its costs on
appeal.

                                   ___________________________
                                   CHAVEZ, J.

We concur:

_______________________________
ASHMANN-GERST, Acting P. J.

_______________________________
HOFFSTADT, J.

dismissal of the matter did not prevent them from being declared
the prevailing parties under the Song-Beverly Act. (Wohlgemuth,
at pp. 1259-1265.) Wohlgemuth does not dictate that this matter
should be remanded for determination of the prevailing party or
attorney fees under the Song-Beverly Act, where no such
determinations were sought below.

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