## Facts

- Omotayo Fasuyi alleged he was injured at work in August 2004 when a brake-cleaning product manufactured by Permatex, Inc. dripped on him.
- In August 2006, shortly before the limitations period expired, Fasuyi filed a personal injury action against Permatex.
- Fasuyi’s counsel had difficulty serving Permatex and contacted Illinois Tool Works, Inc. (Permatex’s parent), which provided instructions and the agent-for-service address.
- Permatex was served on December 4, 2006, after deadlines set by court rules and a case management order.
- After service, a paralegal routed the summons and complaint to an insurance broker, which forwarded it to insurers that acknowledged receipt.
- No answer or responsive pleading was filed for Permatex.
- On February 14, 2007, Fasuyi requested entry of default and a court judgment; the clerk entered default the same day, and a copy was mailed to the agent for service.
- Fasuyi obtained a default judgment for $236,500 thirteen days later.
- After learning of the judgment, Permatex promptly retained counsel, sought a voluntary set-aside, and—after refusal—moved for relief on March 23, 2007, fifteen days after learning of the judgment.
- The trial court denied relief under Code of Civil Procedure § 473(b) in an unexplained four-word order.

## Issues

1. Whether the trial court abused its discretion by denying relief from default and default judgment under Code of Civil Procedure § 473(b).
2. Whether Permatex established “mistake, inadvertence, surprise, or excusable neglect” warranting discretionary relief under § 473(b) based on the record showing prompt handling and absence of dereliction.

## Decision

- The Court of Appeal reversed the order denying § 473(b) relief and reversed the default judgment.
- The court held the trial court abused its discretion because the record showed Permatex was not derelict and acted promptly upon learning of the default judgment.
- The court directed that the default and default judgment be set aside so the case could be litigated on the merits.

## Legal Principles

- California policy favors resolving cases on the merits; doubts concerning § 473(b) relief from default should be resolved in favor of the moving party.
- A denial of § 473(b) relief is reviewed more carefully on appeal than an order granting relief because denial results in forfeiture of a merits determination.
- Under § 473(b), relief may be granted for mistake, inadvertence, surprise, or excusable neglect, and the provision is applied liberally where the record does not show deliberate disregard of the action.
- Prompt action to seek relief after learning of a default judgment supports a finding of excusable neglect and weighs against denying relief.

## Conclusion

The Court of Appeal concluded that the trial court improperly refused to set aside a default and default judgment where the failure to respond stemmed from an internal breakdown in forwarding the suit through corporate and insurance channels, the defendant acted quickly once aware of the judgment, and the governing preference for decisions on the merits required granting § 473(b) relief.


Fasuyi v. Permatex, Inc., 167 Cal. App. 4th 681, 84 Cal. Rptr. 3d 351 (Cal. Ct. App. 2008)