Court Opinion

ID: 9907018
Source: CourtListenerOpinion
Date Created: 2023-12-05 18:02:51.384717+00
Date Added: 2024-06-11T09:55:40.788733
License: Public Domain

Filed 12/5/23 Amin v. Emein CA2/4
         NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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
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     IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                            SECOND APPELLATE DISTRICT

                                        DIVISION FOUR

JOSEPH AMIN,                                                  B322798

     Cross-complainant and                                    (Los Angeles County
Respondent,                                                   Super. Ct. No. BC401794)

         v.

KAMI EMEIN,

     Cross-defendant and
Appellant.

     APPEAL from an order of the Superior Court of
Los Angeles County, Michael L. Stern, Judge. Reversed and
remanded with instructions.
     Jackman Law and Ryan E. Jackman; JZ Law Group, Jacob
Haghnazadeh; Benedon & Serlin, Gerald M. Serlin and Melinda
W. Ebelhar for Cross-defendant and Appellant;
      Law Office of Michael N. Berke and Michael N. Berke for
Cross-complainant and Respondent.

                        INTRODUCTION
        In 2008, a bank sued appellant Kami Emein and
respondent Joseph Amin relating to guaranties for a loan. Amin
cross-complained against Emein for indemnity. Emein did not
answer the complaint or cross-complaint. In 2009, the trial court
entered two default judgments against Emein: one on the bank’s
complaint, and one on Amin’s cross-complaint.
       In 2022, Emein moved to vacate the judgment on Amin’s
cross-complaint, relying on Code of Civil Procedure section 580,
subdivision (a),1 which provides that the amount of a default
judgment “cannot exceed that demanded in the complaint.”
Emein argued that because the cross-complaint did not include
any amount of damages sought, the default judgment was void.
The trial court denied the motion.
       We reverse. Section 580 requires formal notice of damages
in a complaint. Emein’s constructive notice about the amount of
damages the bank sought was insufficient to provide the notice
required by section 580 as to Amin’s indemnity claims in the
cross-complaint.

1    All further statutory references are to the Code of Civil
Procedure unless otherwise indicated.

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       FACTUAL AND PROCEDURAL BACKGROUND
A.    Complaint, cross-complaint, and judgments
      On November 12, 2008, Mirae Bank (the bank2) filed a
complaint against Amin and Emein for breach of guaranty. It
alleged that A & E Interstate Car Wash, Inc. was a California
corporation doing business as a car wash; Amin was the
president and Emein was the secretary. A & E Interstate
Properties, LLC was a California company; Amin and Emein
were co-managers. The bank alleged that in 2006, it loaned $7.2
million to the two A & E entities (collectively, A & E); Amin and
Emein each personally guarantied the note.
      A & E defaulted on the loan in March 2008. The bank
alleged A & E owed $7,123,043.06 in principal, more than
$500,000.00 in interest, more than $16,000.00 in late charges,
and collection costs and attorney fees according to proof. The
bank asserted two causes of action: breach of the Amin guaranty,
and breach of the Emein guaranty. Each cause of action sought
the stated principal, interest, late charges, costs, and attorney
fees.
      In January and February 2009, Emein filed some
documents in the case, including a demurrer and a case
management statement. However, he did not file an answer.
      On April 15, 2009, Amin filed a cross-complaint against
Emein for indemnity, and attached a February 2009 indemnity
agreement to the cross-complaint. Amin alleged that he and
Emein had entered into a 2008 purchase agreement to divide A &
E’s assets. Emein filed a petition of bankruptcy for A & E.

2    Mirae Bank’s successor in interest, Wilshire State Bank,
became the plaintiff before the case concluded.

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Paragraph 3 of the indemnity agreement stated, “[Emein] hereby
agrees to assume and be responsible for any and all liabilities,
obligations, claims, costs, expenses (including without limitation,
attorney’s fees and costs) and damages suffered by [Amin] arising
from and/or in connection with (i) all the properties and
businesses [Emein] has received under the terms of the Purchase
Agreement, including without limitation liabilities arising from
all deeds of trust recorded against those properties and
businesses, and the complaint filed by the Mirae Bank.” Amin
alleged that in March 2009, Emein breached the indemnity
agreement “by failing to assume and be responsible for any and
all liabilities arising from all deeds of trusts recorded against [A
& E’s former] properties and businesses, and the complaint filed
by . . . Mirae Bank.”
        Amin asserted seven causes of action against Emein: (1)
breach of contract, (2) express indemnity, (3) equitable
indemnity, (4) total indemnity, (5) implied contractual indemnity,
(6) contribution, and (7) declaratory relief. The cross-complaint
did not state any specific amount of damages sought. For
example, in the first cause of action for breach of contract Amin
alleged he had suffered damages “according to proof.” In the
second cause of action for express indemnity, Amin alleged he
had incurred legal fees in defending the action brought by the
bank, and would “move to amend this Cross-Complaint to state
the amount when it becomes known to him or on proof thereof.”
In the third cause of action for equitable indemnity, Amin alleged
he was “entitled to equitable indemnity from [Emein] on a
comparative fault basis, in an amount equal to any verdict,
settlement or judgment made in this case which is proportionate
to the contributing negligence or fault on the part of [Emein].”

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The remaining causes of action contained similar statements that
damages would be determined at some point in the future.
       Amin’s prayer requested judgment against Emein “on a
comparative fault basis in an amount which will indemnify
[Amin] for the percentage of the judgment which is proportionate
to the comparative fault of” Emein, an order that Amin was
entitled to indemnity, a judicial determination of the parties’
rights and responsibilities, attorney fees, and costs. Amin served
the cross-complaint by mail to Emein’s counsel on April 14, 2009.
       Documents relating to Emein’s default are not in the record
on appeal, but the register of actions notes that on April 30, 2009,
the bank requested Emein be deemed in default; the court
entered Emein’s default on May 8, 2009.3 Emein states that only
the bank requested that default be entered against him; Amin did
not file such a request. Indeed, the default pursuant to the
bank’s request was entered before the time expired for Emein to
respond to Amin’s cross-complaint. (See § 432.10.) Amin states
in his appellate briefing that Emein also did not file an answer to
the cross-complaint.
       Amin settled his case with the bank, the court approved the
settlement, and the court dismissed Amin from the case. On
September 15, 2009, the trial court held a default judgment
prove-up hearing on the bank’s complaint against Emein. The
court found in favor of the bank and against Emein, and entered
judgment against Emein for $2,624,084.00. The court then held a

3     Emein filed a request for judicial notice in the trial court
stating that default was entered on the bank’s complaint on May
8, 2009. The request refers to Exhibit 3, which is not included in
the appellant’s appendix filed in this court.

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default judgment prove-up hearing on Amin’s cross-complaint
against Emein. The court found in favor of Amin, and entered
judgment against Emein for $2,624,084.00, with blank spaces for
attorney fees and costs.
B.    Emein’s motion to vacate the judgment
      More than 12 years later, on May 4, 2022, Emein filed a
motion to vacate the default judgment on the cross-complaint
under section 473, subdivision (d). Emein asserted that the
judgment was void under section 580, subdivision (a), which
provides that the “relief granted to the plaintiff, if there is no
answer, cannot exceed that demanded in the complaint.” Emein
asserted that because no amount of damages was included in
Amin’s cross-complaint, the court’s default judgment on that
complaint was void.
      Emein noted that the cross-complaint did not incorporate
by reference any amounts or allegations from the bank’s
complaint. Rather, the cross-complaint sought only damages to
be determined once liability to the bank had been established,
and “[n]o such determinations were ever made.” Emein also
asserted that the register of actions for the case did not show any
entry of default on the cross-complaint.
      Amin opposed the motion. He stated that “it is true that no
specific dollar amount is alleged nor demanded on the face of
Amin’s Cross-Complaint.” Amin argued that nevertheless,
“Emein at all times had actual and adequate notice of the
maximum judgment for which he may be responsible,” and the
$2.6 million judgment entered was much less than the $7.2
million demanded in the bank’s complaint. Amin asserted, “The
Judgment against [Emein] is not void under CCP §580 given the
commercial guarantee executed by Emein, which was

                                 6
incorporated by reference into the Bank’s Complaint as an
Exhibit to the Complaint, and thus incorporated into the
substance of the Cross-Complaint against Emein by repeated
reference to the Bank’s Complaint in Amin’s Cross-Complaint.
Emein had sufficient notice of the amount of damages sought by
Amin.”
       As evidence that Emein was aware of any potential
liability, Amin pointed to Emein’s guaranty for the loan, and two
documents filed before Emein was deemed in default: a case
management statement filed by Emein’s counsel, and a
declaration in which Emein acknowledged the loan and
promissory note. Amin argued, “Emein at all times knew exactly
what was transpiring during the litigation, had more than
adequate notice of the maximum judgment for which he could
ultimately be responsible, and elected not to contest either the
Mirae Bank’s Complaint (default judgment) or Amin’s Cross-
Complaint (judgment by prove-up).” Amin asserted that “the
multiple references to the Bank’s lawsuit for damages” in the
cross-complaint were “clear and unequivocal,” which “gave more
than adequate notice of the potential damages Emein was
exposed to in the Cross-Complaint.”
       In reply, Emein asserted that the cross-complaint “does not
make any mention of incorporation of any facts or amounts of
damages from the Complaint. [Citation.] There is no specific
amount of damages sought by the Cross-Complaint against
[Emein] and all damages request/allegations [sic] are based on
any future determination of [Amin’s] liability.” Emein asserted
that constructive notice from other sources was insufficient to
meet the strict requirements of section 580, subdivision (a).

                                7
       No court reporter was present for the hearing on Emein’s
motion. In the minute order from the hearing, the court stated,
“This case went to trial on September 15, 2009. [T]he plaintiff
Bank settled with defendant Amin for $2,624,084.00. The Court
accepted this settlement and dismissed Amin. Then, the Court
held a Default Prove Up Hearing on the Complaint and Cross
Complaint for Indemnity. After taking evidence and testimony,
the Court then put the underlying judgment onto Emein. This
motion [sic] is more than a dozen years old. [¶] The Motion to
Vacate Void Default Judgment filed by Kami Emein on
05/04/2022 is Denied. The motion is denied based on laches.”
       Emein timely appealed.
                             DISCUSSION
       Emein asserts the trial court erred in denying his motion to
set aside the judgment because the judgment is void. We review
de novo a trial court’s determination whether a judgment is void.
(Pittman v. Beck Park Apartments Ltd. (2018) 20 Cal.App.5th
1009, 1020; Cruz v. Fagor America, Inc. (2007) 146 Cal.App.4th
488, 496.)
       A complaint or cross-complaint must include “[a] demand
for judgment for the relief to which the pleader claims to be
entitled. If the recovery of money or damages is demanded, the
amount demanded shall be stated.” (§ 425.10, subd. (a)(2).) When
the defendant or cross-defendant defaults, “[t]he relief granted to
the plaintiff . . . cannot exceed that demanded in the complaint.”
(§ 580, subd. (a); see also § 585, subd. (a) [the court may “enter [a
default] judgment for the principal amount demanded in the
complaint”].) Thus, “in cases in which a plaintiff seeks money
damages, section 580 limits a plaintiff’s relief in default to the

                                 8
dollar amount that has been demanded in the operative
pleading.” (Sass v. Cohen (2020) 10 Cal.5th 861, 878.)
      Section 580 is strictly construed “‘in accordance with its
plain language,’” so that a “default judgment greater than the
amount specifically demanded in the complaint is void as beyond
the court’s jurisdiction.” (Airs Aromatics, LLC v. CBL Data
Recovery Technologies, Inc. (2018) 23 Cal.App.5th 1013, 1018
(Airs Aromatics); see also Greenup v. Rodman (1986) 42 Cal.3d
822, 826 (Greenup) [“a default judgment greater than the amount
specifically demanded is void as beyond the court’s jurisdiction”];
Electronic Funds Solutions, LLC v. Murphy (2005) 134
Cal.App.4th 1161, 1176 (Electronic Funds) [“default judgments
rendered in violation of section 580 are void”].) Under section
473, subdivision (d), a court may “set aside any void judgment or
order.”
      The trial court erred in denying Emein’s motion on the
basis of laches. “Laches is an equitable principle that bars certain
claims or proceedings based on a combination of unreasonable
delay in pursuing the claims and prejudice based on that delay.”
(Malaga County Water District v. State Water Resources Control
Board (2020) 58 Cal.App.5th 447, 462-463.) However, “‘[a] void
judgment can be attacked at any time’ and ‘is not subject to a
claim of laches.’” (Airs Aromatics, supra, 23 Cal.App.5th at p.
1022; see also Falahati v. Kondo (2005) 127 Cal.App.4th 823, 831
(Falahati) [“A motion to vacate a judgment void on its face is not
subject to a claim of laches’”].) If Amin’s judgment against Emein
was void when it was entered, it did not become valid through
Emein’s delay. “What is initially void is ever void and life may
not be breathed into it by lapse of time.” (City of Los Angeles v.
Morgan (1951) 105 Cal.App.2d 726, 731.)

                                 9
       Thus, the relevant question is whether the judgment was
void under section 580 when it was entered. It is undisputed that
no specific demand was included in the cross-complaint. This fact
alone is generally sufficient to render a default judgment void.
(See, e.g., Falahati, supra, 127 Cal.App.4th at p. 830-831 [“Where
no amount of damages is demanded any amount awarded is by
definition greater than the amount demanded”]; Janssen v. Luu
(1997) 57 Cal.App.4th 272, 279 [“If no specific amount of damages
is demanded, there is no adequate notice to the defendant—and a
default judgment entered under those conditions is void”].)
       Amin argues that the lack of a specific demand in the cross-
complaint is of no import because Emein had ample notice of his
exposure to liability. He asserts that Emein was “adequately
notified of the damages sought against him” due to the bank’s
complaint for $7.2 million, the dissolution agreement, the
indemnification agreement acknowledging the lawsuit, and other
documents. Amin also argues that Emein’s filings before default
was entered demonstrate that Emein “was fully apprised of his
potential damage exposure and given adequate notice of the
maximum judgment that could have been assessed against him.”
       However, California case law is clear that “Section 580
requires formal notice of damages sought through the complaint
and does not consider whether a defendant had actual or
constructive notice.” (Airs Aromatics, supra, 23 Cal.App.5th
1013, 1019 [emphasis in original]; see also Greenup, supra, 42
Cal.3d at p. 826 [“due process requires formal notice of potential
liability”]; Stein v. York (2010) 181 Cal.App.4th 320, 326 [“Under
section 580 actual notice of the damages sought is not sufficient”;
“constructive notice of potential liability does not satisfy section
580”]; Electronic Funds, supra, 134 Cal.App.4th at p. 1176 [“due

                                10
process requires not only actual notice of the damages being
sought, but ‘formal notice’”].) Emein’s purported familiarity with
the case or the evidence Amin cites to support a finding of
liability is insufficient to constitute the formal notice required by
section 580.
       Amin also states that although no specific amount was
included in the cross-complaint’s prayer, the bank’s claim for
damages was referenced multiple times in the body of the cross-
complaint. He argues the requirements of section 580 may be met
“when specific damage allegations in the body of the complaint
provide notice of the amounts sought.” Amin cites Becker v.
S.P.V. Construction Co. (1980) 27 Cal.3d 489, 494, in which the
Supreme Court stated that “a prayer for damages according to
proof passes muster under section 580 only if a specific amount of
damages is alleged in the body of the complaint.” Here, however,
no specific amount of damages was alleged in the body of Amin’s
cross-complaint.
       Amin further asserts that the bank’s complaint, including
its attachments, were “incorporated by reference” into the cross-
complaint. He argues that the judgment is not void under section
580 “given the commercial guarantee executed by . . . Emein,
which was incorporated by reference into the Bank’s Complaint
as an Exhibit to the Complaint, and thus incorporated into the
substance of the Cross-Complaint against . . . Emein by repeated
reference to the Bank’s Complaint in . . . Amin’s Cross-
Complaint.”
       Amin relies on Yu v. Liberty Surplus Ins. Corp. (2018) 30
Cal.App.5th 1024 (Yu), in which the trial court deemed void a
default judgment on a cross-complaint that did not include an
amount of damages. The Court of Appeal affirmed, finding that

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“the default judgment of $1.2 million ‘exceeded’ the ‘amount’
demanded in the cross-complaint ($0).” (Id. at p. 1032.) The
appellate court rejected the argument that the cross-complaint
was sufficient because it incorporated by reference the damages
claim in the complaint. The cross-complaint stated, “[The]
Fourth Amended Complaint and any future amended complaints
filed in this action and any cross-complaints filed in this action
are incorporated herein by reference as though fully set forth
herein, for identification and informational purposes only.” (Id.
at p. 1032.) The court found this incorporation did not provide a
“clear and unequivocal” incorporation of the monetary demand
from the complaint (id. at p. 1032), so “the cross-complaint did
not include a damage amount. Thus, the trial court properly
voided the default judgment.” (Id. at p. 1034.)
       Amin also cites Insurance Co. of State of Pennsylvania v.
American Safety Indemnity Co. (2019) 32 Cal.App.5th 898, in
which a complaint for indemnity was deemed sufficient under
section 580 when it specifically incorporated the underlying
arbitration claim by reference and attached it as an exhibit to the
complaint. Amin argues that under the reasoning of this case
and Yu, “Amin’s Cross-Complaint, containing multiple causes of
action for indemnity against . . . Emein, arising from identical
matters set forth in the Bank’s underlying Complaint naming . . .
Emein is absolutely clear.”
       However, Amin’s cross-complaint did not include any
language incorporating the bank’s complaint by reference.
Rather, each cause of action in Amin’s cross-complaint alleged
only damages to be determined later. Simply referring to the
bank’s complaint, without explicitly incorporating it and its

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damages claim by reference, was insufficient to meet the formal
notice requirements of section 580.
      In sum, because the cross-complaint did not include a
specific request for damages, the trial court was without
jurisdiction to enter the default judgment in favor of Amin. The
default judgment is therefore void, and the trial court erred in
denying Emein’s motion to set aside the judgment.
                          DISPOSITION
      The trial court’s order denying Emein’s motion to set aside
the default judgment on the cross-complaint is reversed. The
default judgment on the cross-complaint is vacated as void, and
the matter is remanded for further proceedings. The parties
shall bear their own costs on appeal.
      NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

                      COLLINS, ACTING P.J.

We concur:

MORI, J.

ZUKIN, J.

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