Ammec Investments, Inc. v. Ifaomilekun, LLC CA2/7 ( 2023 )

Filed 5/16/23 Ammec Investments, Inc. v. Ifaomilekun, LLC CA2/7
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IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
AMMEC INVESTMENTS, B314854
INC.,
(Los Angeles County
Cross-complainant and Super. Ct. No. BC669147)
Appellant,
v.
IFAOMILEKUN, LLC,
Cross-defendant and
Respondent.
APPEAL from an order of the Superior Court of
Los Angeles County, Laura A. Seigle, Judge. Affirmed.
Law Offices of Robert A. Brown and Robert A. Brown for
Cross-complainant and Appellant.
No appearance for Cross-defendant and Respondent.
___________________
Ammec Investments, Inc., sued by Cindy Martin, filed a
cross-complaint in September 2017 against Martin and, among
others, Ifaomilekun, LLC. In June 2021 the trial court granted
Ifaomilekun’s motion to dismiss it from Ammec’s cross-action for
failure to serve the summons and cross-complaint within
three years as required by Code of Civil Procedure
section 583.250.1 On appeal Ammec contends the trial court
abused its discretion in granting the motion because the three-
year statutory period was tolled for the first 11 months of the
COVID-19 pandemic when service of process was impossible or
impracticable and because Ifaomilekun’s motion raised issues
going to the merits of the cross-complaint and thus constituted a
general appearance. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
1. Ammec’s Cross-complaint and the Order To Show Cause
for Failure To Timely Serve
Martin filed a complaint to quiet title and for cancellation
of instruments against Ammec on July 19, 2017. On
September 11, 2017 Ammec filed a cross-complaint against
Martin and a number cross-defendants, including Ifaomilekun.
The cross-complaint alleged, in part, that Ifaomilekun had
fraudulently obtain two deeds of trust securing loans made by
Ammec to Martin. Eventually, as a result of settlements and
tactical decisions, Martin’s complaint and Ammec’s cross-
complaint as to Martin and all cross-defendants other than
Ifaomilekun were dismissed.
On April 3, 2020, because of the COVID-19 pandemic, the
trial court vacated the May 26, 2020 trial date and continued the
1 Statutory references are to this code.
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trial setting conference to June 16, 2020. The trial setting
conference was thereafter continued several more times.
On January 21, 2021, after the case had been reassigned to
a new department, the court observed that Ammec had not yet
served Ifaomilekun and issued an order to show cause why
Ifaomilekun should not be dismissed. In response Ammec filed a
proof of service, dated February 19, 2021, indicating Ifaomilekun
had been served by certified mail at a Delaware address with the
summons, cross-complaint and statement of damages.
At a hearing on February 25, 2021 the court pointed out
that the proof of service “does not state when service was made”
and that “Ammec has not shown that Ifaomilekun is an out-of-
state resident who can be served by mail.” The court continued
the hearing to March 26, 2021. Ammec then filed a proof of
service showing that Ifaomilekun had been personally served
through its agent for service of process, CSC-Lawyers
Incorporating Service, at a Sacramento address on March 17,
2021.
On March 26, 2021 the court again continued the hearing
on the order to show cause to April 5, 2021 to allow Ammec to
explain why Ifaomilekun was not served “within 3.5 years.”
That hearing was continued to May 7, 2021.
2. Ifaomilekun’s Motion To Dismiss
On April 12, 2021 Ifaomilekun moved to dismiss the cross-
complaint for Ammec’s failure to serve it within three years.
Ifaomilekun acknowledged it had finally been served on
March 17, 2021 but argued that date was past the mandatory
three-year period for service of the cross-complaint. In addition,
Ifaomilekun asserted Ammec’s purported February 2021 service
by mail at its Delaware office (also beyond three years) was
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improper because its agent for service of process was located in
Sacramento. Ifaomilekun’s motion also questioned the
substantive merit of the two remaining causes of action against
it, contending Greta Curtis, the president of Ifaomilekun, who
had been dismissed by Ammec, was an indispensable party and
the Martin-Ammec settlement eliminated any potential liability
Ifaomilekun might have had to Ammec.
In its opposition Ammec argued Ifaomilekun had made a
general appearance by seeking a merits-based “discretionary
dismissal” through its motion, which it termed an improperly
labeled demurrer or motion for summary judgment. In a
declaration attached to the opposition, Ammec’s counsel
challenged the argument that Ifaomilekun’s agent for service of
process was located in California and insisted the delay in
serving the summons and cross-complaint was due to, and should
be excused because of, the outbreak of the COVID-19 pandemic.
At the hearing on May 7, 2021 the trial court, referring to
the “3.5 years” period it had identified in the order to show cause,
explained “it had assumed the emergency orders had extended
the time limit in section 583.210 by six months” and conceded
“that the court had not found any such emergency order.” The
court discharged the order to show cause, continued the hearing
on Ifaomilekun’s motion to dismiss so Ammec would have
sufficient notice and time to respond and requested supplemental
briefs on whether the three-year time limit in which to serve a
party had been extended because of the COVID-19 pandemic.
Ammec submitted a supplemental brief arguing “the
three year period was tolled from March 2020 through about
March 2021 because of executive orders for stay-at-home and
shelter-in-place in California and Delaware which applied to
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Ifaomilekun’s service locations.” Attached to the supplemental
opposition was Governor Newsom’s Executive Order No. N-33-20
(Mar. 19, 2020), various City of Sacramento health and safety
orders issued between August 31, 2020 and June 1, 2021, and a
February 19, 2021 declaration of emergency issued in Delaware.2
The trial court granted the motion to dismiss on June 23,
2021 and entered a signed order of dismissal the same day. In a
four-page minute order the court explained, “Ammec submits no
evidence that it tried to effect service in the three-year period but
could not find a process server to effect service due to the
pandemic. The registered agent in California for Ifaomilekun is
CSC-Lawyers Incorporating Service, Inc., meaning that Ammec
simply needed to have the complaint and summons delivered to
its office. Ammec did not show that CSC-Lawyers Incorporating
Service, Inc. was closed during the period from March 2020
through March 2021. Ammec did not show that it had made any
effort to serve Ifaomilekun before the January 21, 2021
hearing . . . when the Court raised the issue of Ifaomilekun’s lack
of service and set an Order to Show Cause regarding dismissal of
Ifaomilekun.”
The trial court emphasized that the emergency orders
attached to the supplemental opposition “do not state that
process servers were prohibited from serving complaints or
registered agents were not allowed to be open to accept service
through March 16, 2021. During that time, the orders allowed
businesses . . . to function with social distancing and occupancy
2 Ammec’s request that we take judicial notice of the
emergency orders, made in the middle of its opening brief rather
than in a separate motion as required by California Rules of
Court, rule 8.252(a), is denied as unnecessary.
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requirements. The courts were open for most of that year, and
lawyers were filing and serving documents, making appearances
and conducting trials. . . . Indeed, Ammec actively litigated this
case in the period through March 2021, including briefing and
arguing a summary judgment motion. Therefore, Ammec did not
show that service on Ifaomilekun was impossible or impracticable
due to causes beyond Ammec’s control during the three-year
period.”
Ammec filed a timely notice of appeal.
DISCUSSION
1. Ammec Failed To Demonstrate Its Failure To Serve
Ifaomilekun Was Excused by the COVID-19 Pandemic
a. Governing law and standard of review
“Section 583.210, subdivision (a), provides that a summons
and complaint ‘shall’ be served upon a defendant within
three years after the action is commenced. Section 583.250, in
turn, provides that the action ‘shall’ be dismissed if service is not
made within the statutorily prescribed time and that the
foregoing requirements ‘are mandatory and are not subject to
extension, excuse, or exception except as expressly provided by
statute.’” (Watts v. Crawford (1995) 10 Cal.4th 743, 748; accord,
Steciw v. Petra Geosciences, Inc. (2020) 52 Cal.App.5th 806, 811.)
Section 583.240 provides, however, for the tolling of the three-
year period under certain circumstances, such as when the
defendant was not amenable to the process of the court or service
was impossible, impracticable or futile due to causes beyond the
plaintiff's control.
“The purpose of Code of Civil Procedure section 583.210 is
to give a defendant timely notice of the action so that the
defendant can take adequate steps to preserve evidence.
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[Citation.] ‘The excuse of impossibility, impracticability, or
futility should be strictly construed’ to foster this purpose.”
(Damjanovic v. Ambrose (1992) 3 Cal.App.4th 503, 510.) “The
question of impossibility, impracticability, or futility is best
resolved by the trial court, which ‘is in the most advantageous
position to evaluate these diverse factual matters in the first
instance.’” (Bruns v. E-Commerce Exchange, Inc. (2011)
51 Cal.4th 717, 731.)
We review an order dismissing the defendant for failure to
serve the complaint within three years for abuse of discretion.
(See Busching v. Superior Court (1974) 12 Cal.3d 44, 53
[predecessor to section 583.250]; Republic Corp. v. Superior Court
(1984) 160 Cal.App.3d 1253, 1258 [same].)
b. Ammec failed to present evidence service on
Ifaomilekun was impossible or impracticable due to
COVID-19 emergency orders
Ammec contends on appeal, as it did in the trial court, that
COVID-19 emergency orders issued in California and Delaware
“made it impossible or impracticable to effect service” between
March 2020 and February 2021 because “there was no lawful way
to perform service of Summons and Cross-complaint.” But
Ammec failed to submit any evidence demonstrating the
emergency stay-at-home orders it cited applied to process servers
or otherwise made service of process infeasible during the period
it insists the three-year statute should be tolled. (See E.P. v.
Superior Court (2020) 59 Cal.App.5th 52, 54-55 [“On March 4,
2020, Governor Gavin Newsom declared a state of emergency as
a result of the threat of COVID-19, and on March 19, 2020,
issued an executive order directing all Californians not providing
essential services to stay home. . . . The order did not close the
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courts, which provide an essential service”]; see also Committee
for Sound Water & Land Development v. City of Seaside (2022)
79 Cal.App.5th 389, 401 [same].).
Additionally, Ammec failed to show that CSC-Lawyers
Incorporating Service, the agent for service of process for
Ifaomilekun, was unavailable or refused service because of the
emergency orders issued by Governor Newsom or a local
government. Absent evidence to the contrary, the trial court was
well within its discretion in concluding the ability to serve
Ifaomilekun was not beyond Ammec’s control. (See Shipley v.
Sugita (1996) 50 Cal.App.4th 320, 326 [“section 583.240,
subdivision (d), by its very terms, limits its exceptions to
circumstances ‘beyond the plaintiff’s control’”]; Bishop v. Silva
(1991) 234 Cal.App.3d 1317, 1322 [“plaintiff’s problems [in
effecting service] were within his own control”]; cf. Crane v.
Dolihite (2021) 70 Cal.App.5th 772, 792 [“the time during which
official acts frustrated the service of process and denied an
indigent prisoner his statutory right of access to the courts
qualifies as time during which service was ‘impracticable[ ] or
futile due to causes beyond the plaintiff’s control’”].)
Finally, as the trial court explained, Ammec was actively
pursuing the case in the period through March 2021, including
briefing and arguing a summary judgment motion, supporting a
strong inference that its failure to serve Ifaomilekun was not due
to its inability to access litigation-related services. (See Kokubu
v. Sudo (2022) 76 Cal.App.5th 1074, 1088-1089 [“Between the
date the trial court granted the expungement motion and the
date Appellants filed their motion to compel arbitration,
Appellants were active participants in the litigation and readily
imposed on the trial court and Respondents when it served their
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interests. . . . With this context, the suggestion that COVID
precluded filing their arbitration motion promptly after
resolution of the lis pendens issue lacks evidentiary support”];
Yablonsky v. California Dept. of Corr. & Rehabilitations
(S.D. Cal., Sept. 1, 2022, No. 3:18-CV-1122-AGS)
2022 U.S.Dist. Lexis 158685, at pp. *7-8 [“Yablonsky claims the
one-year COVID-19 ‘lockout,’ . . . should toll the three-year limit
because it constituted ‘acts outside the plaintiff[’s] control.’ . . .
Yablonsky’s active litigation practice defeats his claim that
service was ‘impossible’ within three years. So it was not clear
error for the Court to conclude the statutory exception was
inapplicable”].)
2. Ifaomilekun Did Not Generally Appear Before Expiration
of the Three-year Time To Serve the Cross-complaint
Ammec alternatively contends its failure to serve
Ifaomilekun within three years did not justify the order
dismissing Ifaomilekun because Ifaomilekun had generally
appeared by filing a motion to dismiss that presented substantive
arguments, not merely challenges to the trial court’s jurisdiction.
Ammec, of course, is correct that a general appearance
obviates the need to serve a defendant (or cross-defendant)
within the time specified in section 583.210. (§ 583.220 [“[t]he
time within which service must be made pursuant to this article
does not apply if the defendant enters into a stipulation in
writing or does another act that constitutes a general appearance
in the action”]; see, e.g., Rockefeller Technology Investments
(Asia) VII v. Changzhou SinoType Technology Co., Ltd. (2020)
9 Cal.5th 125, 139 [“[p]rocess is waived by a general appearance,
in person or by attorney, entered in the action, or by some act
equivalent thereto, such as the filing of a pleading in the case or
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by otherwise recognizing the authority of the court to proceed in
the action,” italics omitted]; Altafulla v. Ervin (2015)
238 Cal.App.4th 571, 577-578 [“[i]t is axiomatic that defects in
service may be waived by a responding party either expressly or
by appearing in an action and contesting the merits of the claims
asserted”].) However, a motion to dismiss for untimely service
generally does not constitute a general appearance. (See
§ 583.220 [“[N]one of the following constitutes a general
appearance in the action: [¶] . . . [¶] (b) A motion to dismiss made
pursuant to this chapter, whether joined with a motion to quash
service or a motion to set aside a default judgment, or
otherwise”]; Bishop v. Silva, supra, 234 Cal.App.3d at p. 1323
[“Subdivision (b) of section 583.220 specifically provides that
motions to quash and dismiss for untimely service do not
constitute a general appearance”].)
Notwithstanding section 583.220, subdivision (b), Ammec
argues Ifaomilekun’s motion to dismiss was a general appearance
because it “sought affirmative relief that appellant was barred by
settlement with Martin . . . and by failure to join Curtis as an
‘indispensable party.’” In support Ammec cites Goodwine v.
Superior Court (1965) 63 Cal.2d 481, 484, in which the Supreme
Court held a motion to dismiss for lack of subject matter
jurisdiction was not a general appearance, but added, “‘“[Where]
the defendant appears and asks [for] some relief which can only
be granted on the hypothesis that the court has jurisdiction of
cause and person, it is a submission to the jurisdiction of the
court as completely as if he had been regularly served with
process, whether such an appearance by its terms be limited to a
special appearance or not.”’”
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Even were we to agree that Ifaomilekun’s motion sought
affirmative relief that would constitute a general appearance,3
Ammec fails to acknowledge, let alone refute, well-established
case law (including a case cited by the trial court) that, once the
three-year period for service has expired, a general appearance
does not affect a defendant’s right to a mandatory dismissal of
the action. (E.g., Blank v. Kirwan (1985) 39 Cal.3d 311, 333
[“[e]ven if entering into the stipulation could be deemed to
constitute a general appearance, dismissal was nonetheless
mandatory: ‘a general appearance after the three years had run
did not operate to deprive a defendant of his right to a
dismissal’”]; Busching v. Superior Court, supra, 12 Cal.3d at p. 51
[same]; Brookview Condominium Owners’ Assn. v. Heltzer
Enterprises-Brookview (1990) 218 Cal.App.3d 502, 509 [cited by
3 Although Ifaomilekun’s motion discussed why the
remaining causes of action lacked merit, the motion only asked
the court to dismiss the cross-complaint for failure to timely serve
the summons and cross-complaint. Ifaomilekun sought no
affirmative relief relating to the merits of the matter. (See
Renoir v. Redstar Corp. (2004) 123 Cal.App.4th 1145, 1153 [“[t]he
appearance will be considered general in nature if the defendant
acts in a manner showing of a purpose of obtaining any ruling or
order of the court going to the merits of the case,” quotation
marks omitted]; Dial 800 v. Fesbinder (2004) 118 Cal.App.4th 32,
52-53 [“[i]f the defendant ‘raises any other question, or asks for
any relief which can only be granted upon the hypothesis that the
court has jurisdiction of his person, his appearance is general’”].)
As the trial court detailed, “Ifaomilekun’s notice of motion states
the motion is brought only on the grounds that Ammec did not
timely complete service and the attempted service was
incomplete.” Neither ground recognized the authority of the
court to proceed on the merits of the action.
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the trial court: “[A]ny claimed general appearance must have
occurred within the mandatory three-year period. An appearance
made thereafter does not deprive a defendant of his right to
dismissal”].) Ifaomilekun did not file its motion to dismiss until
April 12, 2021, well past the three-year (September 17, 2020)
deadline for Ammec to serve it with a summons and copy of the
cross-complaint. The trial court did not abuse its discretion in
dismissing the action against Ifaomilekun.
DISPOSITION
The order of dismissal is affirmed. Because Ifaomilekun
did not participate in the appeal, Ammec is to bear its own costs.
PERLUSS, P. J.
We concur:
SEGAL, J.
FEUER, J.
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