Court Opinion

ID: 9746561
Source: CourtListenerOpinion
Date Created: 2023-08-27 14:23:03.87654+00
Date Added: 2024-06-11T07:25:14.700045
License: Public Domain

MOSK, J.
I concur.
Appellant Traci & Marx Co. (Traci & Marx), an Ohio company, obtained a default judgment in Ohio against respondent Legal Options, Inc. (Legal Options), a California company, on a complaint based, inter alia, on fraud. The Ohio court awarded compensatory and punitive damages in the total amount of $155,890 plus interest. The majority concludes correctly that under Code of Civil Procedure section 1710.10 et seq., we must enforce a sister-state judgment that is contrary to California’s public policy. (Medical Legal Consulting Services, Inc. v. Covarrubias (1991) 234 Cal.App.3d 80, 90 [285 Cal.Rptr. 559]; Tyus v. Tyus (1984) 160 Cal.App.3d 789 [206 Cal.Rptr. 817].)
The Law Revision Commission stated with respect to Code of Civil Procedure section 1710.40 that a judgment debtor may move to vacate the entry of a sister state judgment “on any ground which would be a defense to an action in this state on the sister state judgment.” (Recommendation: Enforcement of Sister State Money Judgments (Nov. 1973) 11 Cal. Law Revision Com. Rep. § 1710.40, pp. 466^-67, reprinted in 19A West’s Ann. Cal. Codes (1982 ed.) foil. § 1710.40, pp. 693-694.) The grounds include, “the judgment is not enforceable in the state of rendition” and “the judgment was rendered in excess of jurisdiction.” (Ibid.)
The majority suggests that because respondent has not provided us with explicit law demonstrating that the Ohio judgment was contrary to Ohio law, that judgment must, in effect, be presumed to be lawful and that therefore the trial court may not, under Code of Civil Procedure section 1710.40, vacate the California judgment or enter a judgment different than the Ohio default judgment. Respondent did argue that the Ohio judgment was contrary to Ohio law and referred to some authorities, but not conclusive authorities.
*162I believe we should determine whether under Ohio law, the Ohio judgment was in excess of jurisdiction or was not enforceable in Ohio to see if the Ohio judgment should be vacated or modified under Code of Civil Procedure section 1710.40.
Ohio Civil Rule 8 provides that if a party seeks more than $25,000 in damages for a claim not based upon a written statement, the party shall state that fact in the demand for judgment, but shall not state the actual amount the party seeks. Under Ohio Civil Rule 54(C), “A judgment by default shall not be different in kind from or exceed in amount that prayed for in the demand for judgment.”
It is widely recognized that entering a default judgment is unfair unless the defaulting defendant has notice of the judgment that may be taken against it. “The defendant is entitled to ‘ “one ‘last clear chance’ to respond to the allegations of the complaint and to avoid the precise consequences . . . [of] a judgment for a substantial sum . . . [without] any actual notice of . . . potential liability. Indeed . . . ‘knowledge of the alleged amount of damages may be crucial to a defendant’s decision whether to permit a clerk’s default’ ....’’ (Schwab v. Rondel Homes, Inc. (1991) 53 Cal.3d 428, 433 [280 Cal.Rptr. 83, 808 P.2d 226], superseded by statute on another ground; see also Becker v. S.P.V. Construction Co. (1980) 27 Cal.3d 489, 493-94 [165 Cal.Rptr. 825, 612 P.2d 915]; 10 Wright et al„ Federal Practice and Procedure: Civil (3d ed. 1998) § 2663, pp. 166-173); 46 Am.Jur.2d. (1994) Judgments § 312, pp. 628-630.)
Yet, if courts applied Ohio law in the manner suggested by Traci & Marx, a defendant in Ohio could limit damages to $25,000 by defaulting. One authority on Ohio procedure has noted as follows: “Assuming the opposing party defaults, a question arises as to the damage amount the claimant may be awarded consistent with the limitation in the first sentence of Rule 54(C). Perhaps the provisions can be reconciled to provide that where the party’s pleading states a request for damages in excess of $25,000 the court is free to award a larger amount since a larger, but indeterminate, amount is what was prayed for in the demand for judgment. Alternatively, if the opposing party defaults, perhaps the plaintiff then should be allowed to amend the pleadings to set forth the actual amount sought. With that accomplished, if the opposing party remains in default after being served with the amended claim for relief, a default judgment could be entered in line with the amount set forth in the amended pleading.” (Fink et al., Guide to the Ohio Rules of Civil Procedure (2005) § 54.10, p. 54-17.) Such an amended claim specifying an amount of damages in excess of $25,000 for the type of allegations here does not appear to be consistent with Ohio Civil Rule 8.
*163As in this case, when there is a prayer for damages “in excess of $25,000,” the defaulting party knows there is a risk of damages in an amount exceeding $25,000. Under Ohio Civil Rule 8(A), a defendant against whom a default is taken may request a statement of the precise amount of damages sought before the default hearing. Moreover, under Ohio Civil Rule 55(B), a party may move to vacate or set aside a default judgment. These provisions provide a defaulting party in Ohio with some protection against the specter of unknown and unlimited liability.
In view of these considerations, it appears that the Ohio trial court’s decision awarding damages in excess of $25,000 in this case is in conformity with Ohio law. Legal Options has not submitted any persuasive authority to the contrary.
For these reasons, I concur in the judgment.