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Dakota Payphone, LLC v. Hugo Alcaraz

February 2, 2011

DAKOTA PAYPHONE, LLC, PLAINTIFF AND APPELLANT,
v.
HUGO ALCARAZ, DEFENDANT AND APPELLANT.



APPEAL from the Superior Court of Riverside County. Gary B. Tranbarger and Dallas Holmes, Judges and Paulette Durand-Barkley, Temporary Judge. (Super.Ct.No. RIC443215)

The opinion of the court was delivered by: Ramirez P.J.

CERTIFIED FOR PUBLICATION

OPINION

(Pursuant to Cal. Const., art VI, § 21.) Dismissed in part and affirmed.

Defendant Hugo Alcaraz (Alcaraz) appeals from the trial court's entry of a default judgment against him claiming that the default should be set aside because it was obtained through the mistake, fraud and collusion of his former attorneys. (Code Civ. Proc.,*fn1 § 473, sub. (b).) Plaintiff Dakota Payphone, LLC (Dakota) appeals from the trial court's order purporting to grant, in part, Alcaraz's motion for a new trial, asserting that the trial court had lost jurisdiction to make such a ruling. Dakota also asserts that Alcaraz's appeal is untimely and should be dismissed. We agree with Dakota's assertion and dismiss Alcaraz's appeal as untimely.*fn2 Further, although we also agree with Dakota that the trial court had lost jurisdiction to rule upon a motion for a new trial, we hold that it retained the authority to correct the void portion of its judgment. We therefore construe the trial court's December 29, 2008, order as an order modifying a partially void judgment and affirm it as such.

FACTS AND PROCEDURAL HISTORY

Dakota's verified third amended complaint alleged that Dakota entered into 330 purchase agreements with Alcaraz and other defendants not party to this appeal (collectively Defendants). These agreements stated that Dakota would buy approximately 5,836 payphones from Defendants. Defendants agreed to lease the payphones from Dakota in what is known as a leaseback (see Rev. & Tax. Code, § 6010.65) and place them in public locations. Alcaraz agreed to personally guarantee each of the 330 agreements.

In its complaint, Dakota alleges causes of action against Defendants for (1) breach of contract, (2) fraud, (3) conversion, (4) an accounting, (5) a constructive trust, and (6) injunctive relief. Defendants allegedly breached each of the agreements in January 2006, when they failed to make their lease payments for the 5,836 payphones. The unpaid amounts totaled $461,044. Defendants also breached the agreements by (1) entering into similar leaseback agreements with other parties, (2) intentionally failing to purchase the payphones when the lease agreements expired, (3) intentionally failing to maintain the payphones, (4) intentionally failing to place the payphones in the locations designated in the agreements, (5) intentionally failing to notify Dakota of the changes in the locations of the payphones, (6) intentionally failing to indemnify Dakota for lost equipment, and (7) failing to pay for third party bills related to the payphones. Dakota alleged specifically against Alcaraz that he breached his guarantee to pay the monies owed, and that he was still in possession of and collecting money from payphones that belonged to Dakota. These breaches were alleged to have resulted in $45,000,000 in damages to Dakota.

In its second cause of action for fraud, Dakota alleged that Alcaraz had been taking millions of dollars from the companies that were also named as defendants and knew that these companies did not have the money to make the monthly lease payments to Dakota and other investors. Alcaraz allegedly used the money provided by new investors to make monthly payments to prior investors. Dakota and other investors paid Alcaraz "millions of dollars." Indeed, Dakota alleged that it was induced to spend $10,863,000 on payphones as a result of Alcaraz's fraud. In its prayer for relief, Dakota sought "damages in an amount not less than $45,000,000."

The trial court entered a default judgment against Alcaraz on September 4, 2008, awarding Dakota $45,000,000 in compensatory damages and specifying that $14,968,500 of that amount was based upon the fraud of Alcaraz. Notice of entry of that judgment was served on Alcaraz on September 8, 2008. On September 23, 2008, Alcaraz filed a timely notice of intention to move for a new trial. (§ 659 [notice of intention to move for a new trial must be filed within 15 days of the date of mailing notice of entry of judgment].) Alcaraz asserted that the damages and attorney's fees awards were excessive and that Dakota failed to include a statement of damages in its third amended complaint. Dakota opposed the motion, in part based upon its assertion that the trial court lacked jurisdiction to decide the motion.

On December 29, 2008, an order of the trial court was filed purporting to grant the motion for a new trial, in part, to limit the amount of damages attributable to Alcaraz's fraud to the amount set forth in the operative third amended complaint, and denying the motion in all other respects. An amended judgment of default was entered against Alcaraz on January 14, 2009, identical in every respect to the September 4, 2008, judgment except that the amount of the compensatory damages attributed to the fraud of Alcaraz was $10,863,000 (a reduction of $4,105,500). Notice of entry of the amended judgment was served on Alcaraz on January 16, 2009. On February 17, 2009, Alcaraz filed a notice of appeal "from the judgment entered on January 14, 2009 . . . ." On March 4, 2009, Dakota filed what it deemed to be a notice of cross-appeal, challenging the trial court's December 12, 2008, order purporting to grant, in part, Alcaraz's motion for a new trial.*fn3

DISCUSSION

A. Disposition of the Cross-appeal

In its cross-appeal, Dakota asserts that the trial court had no jurisdiction to grant Alcaraz's motion for a new trial. An order granting ...


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