California Court of Appeal Feb 1, 2016 No. D068062Unpublished
Filed 2/1/16 Trousas v. Kim CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
KIM TROUSAS et al., D068062
Plaintiffs and Respondents,
v. (Super. Ct. No. SCVSS146291)
SOO M. KIM et al.,
Defendants and Appellants.
APPEAL from orders of the Superior Court of San Bernardino County, Bryan F.
Foster, Judge. Affirmed in part and reversed in part with directions.
Best Best & Krieger and Kira L. Klatchko for Defendant and Appellant Soo M.
Kim.
Law Office of Chad Biggins and Chad Biggins for Defendant and Appellant
Samuel Kim.
Pedersen McQueen, Neil Pedersen, Teresa A. McQueen and Armond M. Jackson
for Plaintiffs and Respondents.
In this case, we affirm in part the trial court's orders denying defendants and
respondents Soo Kim's and Samuel Kim's (hereinafter sometimes referred to by their first
names or collectively as the Kims) respective motions to be relieved from default
judgments entered against them. Both of the Kims appeared in the trial court and then
failed respectively to respond to discovery requests and a first amended complaint (FAC)
filed by plaintiffs and respondents Kim Trousas, Brandi Lynn Stiff, and Rebecca Meta
Cal.App.4th 1139, 1150.) A damage award not supported by substantial evidence is
excessive and thus subject to our review, not withstanding that it was made in a default
proceeding and is embodied in a default judgment. (Ostling v. Loring (1994) 27
Cal.App.4th 1731, 1746.) Accordingly, the validity of the punitive damage award is
properly before us and, because there is no evidence of Soo's financial condition in the
record, we must reverse the portion of the judgment against her that awards plaintiffs
punitive damages.
II.
SAMUEL KIM'S APPEAL
A. Shulman's Authority
As he did in the trial court, Samuel once again argues that Shulman had no
authority to represent him. The record wholly refutes his contention.
As was the case with respect to Soo, based on Shulman's appearance on behalf of
Samuel at the case management conferences, the trial court was permitted to presume that
Shulman was authorized to do so. (Kallman v. Henderson, supra, 234 Cal.App.2d at
p. 98.) That presumption was of course rebuttable. (Ibid.) However, in attempting to
rebut the presumption, Samuel relied solely on his own declaration stating that he did not
authorize Shulman to act on his behalf and had no knowledge of the action until plaintiffs
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attempted to execute on his bank accounts. He offered no evidence from Shulman or any
evidence that he attempted to obtain evidence from Shulman. On this record, this
showing was entirely inadequate to overcome the presumption of authority.
As we have noted, in initially challenging the default judgment Samuel relied
solely on the narrow and entirely technical argument that service of the statement of
damages on Shulman by mail was ineffective because Shulman had not appeared in the
action on behalf of Samuel. (See Code Civ. Proc., § 425.11, subd. (d)(1) & (2).) This
initial argument was not supported any declaration from Samuel or any assertion with
respect to Shulman's authority to represent him. Only when, in opposition to Samuel's
motion, plaintiffs produced evidence both that Shulman represented he had authority to
accept service of the FAC and thereafter appeared at case management conferences on
Samuel's behalf, did Samuel attack Shulman's authority to act on his behalf and argue that
therefore the acknowledgement of service of process signed by Shulman did not give the
trial court jurisdiction over him and that service of the statement of damages on Shulman
was invalid. Samuel's belated presentation of the broader equitable argument that he had
been the victim of fraud by Shulman suggests recent invention and plainly undermines
Samuel's credibility.
Samuel's statement that he had no knowledge of the action until plaintiffs executed
on their judgment also lacks credibility. The record shows that Samuel was an owner of
KCS and that his brother, Conway Kim, was another owner of KCS. The record also
suggests that Samuel was the agent for service of process for both KCS and 3-CKS, the
15
transferee of KCS's interest in Kay's Café. The transfer to 3-CKS, which occurred after
the lawsuit commenced, of course suggests an effort to avoid payment of any judgment.
Given these circumstances, in order to accept Samuel's assertion that he was entirely
ignorant of plaintiffs' complaint, one would have to believe that although Conway and his
friend Soo were defending the litigation in which Samuel's interest in KCS was plainly
placed in peril and arranging for the transfer to 3-CKS, they both nonetheless kept
Samuel in the dark about the litigation. The trial court plainly was not required to
indulge such a dubious narrative.
In sum, the record shows that Shulman was presumptively authorized to appear on
Samuel's behalf and that Samuel's belated, self-serving and uncorroborated declaration
failed to overcome that presumption. Thus, the FAC and statement of damages were
properly served on Shulman before Samuel's default was entered, and the trial court did
not err in denying Samuel's motion for relief from the default judgment.1
B. Punitive Damages
As was the case with respect to Soo, no evidence of Samuel's financial condition
was offered at the prove-up hearing, and, accordingly, the trial court erred in awarding
$750,000 in punitive damages against him. As we indicated with respect to Soo, in
1 Parenthetically, we reject Samuel's alternative contention that Shulman's conduct amounted to the abandonment that permits relief from default under the court's power to remedy extrinsic fraud. (See Orange Empire Nat'l Bank v. Kirk (1968) 259 Cal.App.2d 347, 353-356.) Having asserted that he did not know about the litigation and never retained Shulman, Samuel never presented any evidence that he relied on Shulman to represent him and that Shulman thereafter, and for no valid reason, failed to protect his interests. In the absence of such evidence, the trial court could only speculate as to whether the failure to defend the action was the fault of Samuel or Shulman. 16
attacking the default judgment Samuel may challenge such an award of punitive damages
as excessive. (See Steven M. Garber & Associates v. 2.5Eskandarian, supra, 150
Cal.App.4th at p. 824; Scognamillo v. Herrick, supra, 106 Cal.App.4th at p. 1150.)
DISPOSITION
The orders denying Soo Kim's and Samuel Kim's motions for relief from the
default judgments are reversed insofar as the orders leave undisturbed the respective
awards of punitive damages. On remand, the trial court is directed to vacate the awards
of punitive damages and permit plaintiffs to seek awards of punitive damages that meet
the requirements of the law and due process and, in particular, present evidence with
respect to the financial condition of Soo Kim and Samuel Kim. In all other respects, the
orders are affirmed.2
Plaintiffs to recover their costs of appeal. BENKE, Acting P. J.
WE CONCUR:
HALLER, J.
IRION, J.
2 Soo has asked that we take judicial notice of documents related to Shulman's 2014 summary disbarment. Neither the documents nor the circumstances set forth in them were before the trial court when it ruled on Soo's motion for relief from the default judgment. Her request for judicial notice is therefore denied. (Doers v. Golden Gate Bridge etc. Dist. (1979) 23 Cal.3d 180, 184.) 17
AI Brief
AI-generated · verify before citing
Holding. The court affirmed the denial of motions to set aside default judgments, finding the defendants were properly served and authorized their counsel, but reversed the punitive damages awards because the plaintiffs failed to present evidence of the defendants' financial condition.
Issues
Whether the trial court erred in finding that the defendants were properly served and had authorized their attorneys to appear on their behalf.
Whether the punitive damages awards in the default judgments were excessive due to a lack of evidence regarding the defendants' financial condition.
Disposition. Affirmed in part and reversed in part with directions.
Quotations verified verbatim against the opinion
“The record supports the trial court's conclusions the Kims authorized the respective attorneys to act on their behalf and were properly served with the FAC and the statement of damages.”
“an award of punitive damages cannot be sustained on appeal unless the trial record contains meaningful evidence of the defendant's financial condition”