## Facts

- David Schwab and Bill Allen sought to rent an apartment at Lincoln Terrace, owned and managed by Rondel Homes, Inc.
- Allen is deaf and used a trained signal dog; plaintiffs informed the manager of the dog’s function and provided documentation.
- The manager refused to rent to plaintiffs because of the signal dog.
- Plaintiffs sued for housing discrimination under California Civil Code § 54.1(b)(5), seeking damages under Civil Code § 54.3.
- The complaint requested emotional distress damages and other losses “according to proof,” statutory treble damages “no less than $250,” attorney’s fees, and punitive damages of $500,000, but did not state a specific amount of compensatory damages.
- Defendants did not respond; default was entered, and after a prove-up the trial court awarded each plaintiff $50,000 in general damages, $100,000 in punitive damages, plus fees and costs.
- The trial court later set aside the default and default judgment for failure to serve a statement of damages under Code of Civil Procedure § 425.11.
- The Court of Appeal reinstated the default judgment but reduced general damages to $25,000 per plaintiff.
- The California Supreme Court granted review.

## Issues

1. Whether a plaintiff may take a default and obtain a default judgment when the complaint does not state the amount of general and special damages sought and the plaintiff did not serve a statement of damages under Code of Civil Procedure §§ 425.10 and 425.11.

## Decision

- The California Supreme Court reversed the Court of Appeal.
- The court held that a plaintiff may not take a default or obtain a default judgment without giving the defendant actual notice of the amount of damages sought, as required by §§ 425.10 and 425.11.
- Because plaintiffs did not serve a statement of damages and the complaint did not provide the required notice of compensatory damages exposure, the default and default judgment were improper.
- The court reinstated the trial court’s order setting aside the default and default judgment.
- The court disapproved contrary appellate authority to the extent it permitted default judgments absent notice in the complaint or a statement of damages.

## Legal Principles

- In actions covered by Code of Civil Procedure §§ 425.10 and 425.11, a plaintiff seeking money damages must provide the defendant actual notice of the nature and amount of damages sought before default, either through an amount demanded in the complaint (when permitted) or by serving a statement of damages.
- Code of Civil Procedure § 580 limits a default judgment to amounts demanded in the complaint or in a properly served statement of damages; a prayer “according to proof” does not provide the required notice.
- The notice requirement serves due process by informing a defendant of maximum monetary exposure before deciding whether to appear or allow default.
- A default and default judgment entered without the required damages notice are subject to being set aside; a reviewing court may not cure the defect merely by reducing the award.

## Conclusion

The court held that statutory and due process requirements bar entry of default and default judgment when the defendant did not receive actual notice of the amount of damages sought through a compliant complaint demand or a served statement of damages, and it reinstated the order vacating the default and judgment.


Schwab v. Rondel Homes, Inc., 53 Cal. 3d 428 (Cal. 1991)