Sail Exit Partners v. Severson CA4/3

CourtCalifornia Court of Appeal
DecidedJanuary 11, 2022
DocketG059275
StatusUnpublished

This text of Sail Exit Partners v. Severson CA4/3 (Sail Exit Partners v. Severson CA4/3) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sail Exit Partners v. Severson CA4/3, (Cal. Ct. App. 2022).

Opinion

Filed 1/11/22 Sail Exit Partners v. Severson CA4/3

NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FOURTH APPELLATE DISTRICT

DIVISION THREE

SAIL EXIT PARTNERS, LLC, G059275 Plaintiff and Respondent, (Super. Ct. No. 30-2018-00994978) v. OPINION JOHN A. SEVERSON,

Defendant and Appellant;

MARILYN WILLIAMS,

Real Party in Interest and Appellant.

Appeal from a judgment and postjudgment order of the Superior Court of Orange County, Charles Margines, Judge. Affirmed. Respondent’s motion to dismiss denied. Law Offices of Alexandria C. Phillips and Alexandria C. Phillips for Defendant and Appellant and Real Party in Interest and Appellant. Troutman Pepper Hamilton Sanders and Peter N. Villar for Plaintiff and Respondent. * * * John A. Severson and Marilyn Williams appeal following the trial court’s denial of their respective postjudgment motions challenging a March 2019 default judgment against Severson. Severson sought to vacate the default judgment; Williams sought to exempt community property that would otherwise be subject to lien or levy to satisfy the judgment on grounds that she and Severson were never actually married because their 2004 Italian wedding did not satisfy Italy’s requisite formalities. On appeal, Severson makes entirely new arguments in which he purports to appeal the default judgment itself, long after the time in which to appeal that judgment expired. In a supplemental opening brief this court gave him leave to file, instead of attacking the merits of the default judgment as he did in his original opening brief, he again attempts to vacate the default judgment as a purportedly void judgment. But he does so on a new and different ground than he asserted below. For her part, Williams attacks the trial court’s evidentiary rulings in which it (1) found that an unauthenticated letter said to be from a European attorney constituted inadmissible hearsay, and (2) denied Williams’s oral motion on the day of the hearing to have the European lawyer testify remotely, apparently regarding what others thought or said about the existence or nonexistence of the marriage. Williams also challenges the trial court’s alternative ruling that even if the marriage was not technically valid, it constituted a union between putative spouses (Fam. Code, § 2151), to which the court applied the rule that “property divided pursuant to [s]ection 2251 is liable for debts of the parties to the same extent as if the property had been community property or quasi- community property.” (Id., § 2252.) We need not reach the trial court’s putative spouse ruling; the court did not abuse its discretion in its evidentiary rulings, and Williams did not otherwise meet her

2 burden as the moving party on her claim she was not married to Severson. Nor, as we explain, do any of Severson’s arguments meet his burden as the appellant to secure reversal. We therefore affirm the trial court’s judgment and postjudgment order.

FACTUAL AND PROCEDURAL BACKGROUND SAIL Exit Partners, LLC (SAIL or Sail Exit), an investment fund, sued Severson and others in May 2018 alleging that Severson, the Orange County agent for defendants Schneider Brothers Ltd. and Schneider Finance LLC (collectively, Schneider Brothers), acted in conjunction with a former managing member of SAIL, Walter L. Schindler, to misappropriate from SAIL almost 600,000 shares of stock in a company known as Ener-Core—among other stock assets. According to SAIL, the Ener-Core stock alone was worth more than $950,000. SAIL alleged Severson and Schneider Brothers sold a portion of the Ener-Core stock on the European market and, while conceding the proceeds belonged to SAIL, he never returned them despite repeated demands. SAIL’s causes of action and theories of liability included conversion, civil conspiracy, aiding and abetting liability, and imposition of a constructive trust. SAIL had Severson personally served with the complaint in June 2018. On October 8, 2018, the process server personally served Severson with the requisite 1 statement of damages. (Code Civ. Proc., § 425.115.) The statement (1) noted the date the complaint had been filed, May 24, 2018, (2) was headed in boldface type, “Notice to Defendant John A. Severson” (capitalization adjusted), and (3) consisted of one further sentence stating that SAIL “reserves the right to seek $670,000 in punitive damages when [SAIL] seeks a judgment in the suit filed against you.” While served on October 8, 2018, the statement of damages in the record is dated “October 23, 2018.” SAIL then filed in the trial court and served on Severson a request for entry of default, which the trial court 1 All further statutory references are to the Code of Civil Procedure unless otherwise noted.

3 entered the next day, October 24, 2018. The court had already entered Schneider Brothers’s default. With no response from either Severson or Schneider Brothers forthcoming on the defaults, several months later SAIL moved the court to enter default judgments against both defendants. SAIL served Severson with the request on March 1, 2019, and filed the request in court the same day. The request prayed for $110,988.23 in compensatory damages, $670,000 in punitive damages, plus almost $10,000 in interest and costs for a total damages figure of $790,211.92. The trial court entered judgment in that amount against Severson and Schneider Brothers on March 20, 2019. Neither party appealed the judgment. In September 2019, after obtaining a writ of execution from the trial court, SAIL served TD Ameritrade with a notice of levy for the purpose of levying on 2 community property owned by Severson and his wife, Marilyn Williams. In October 2019, the trial court ordered Williams to appear for an examination, in advance of which she filed an exemption claim with the levying officer; in that claim Williams acknowledged she had “married John Severson in 2004.” According to SAIL, Severson then “conveniently informed” the attorney representing him and Williams “that he was ‘not certain that [he and Williams] were legally married’ on October 25, 2019—seven months after SAIL obtained the March 2019 Default Judgment against him.” Williams filed an ex parte motion in November 2019 to stay collection efforts, which the trial court granted pending a hearing. That same month, Williams filed a formal motion for an “Order Releasing Judgment Lien” and Severson filed a motion to vacate the default judgment against him.

2 SAIL presented evidence below that outside of this litigation Williams uses Marilyn Severson or Marilyn Williams-Severson as her name.

4 Following a hearing in July 2020, the trial court denied both motions. In a detailed minute order, the court explained that Severson’s motion was timely because it was “an attack on an allegedly void default judgment . . . . A default judgment in excess of the complaint’s demand (or other notice of sums at issue) is void and may be vacated at any time. [Citation.]” The court explained that “[a] default judgment for greater relief or a different form of relief than demanded in the complaint is beyond the court’s jurisdiction. [Citations.]” Nevertheless, as we explain more fully below, the trial court denied Severson’s attempt to vacate the judgment. As to Williams, the trial court noted that SAIL contended Williams conceded “she has been living with Mr. Severson since 1998 and that she married him at an intimate ceremony in Italy in 2004.

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Sail Exit Partners v. Severson CA4/3, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sail-exit-partners-v-severson-ca43-calctapp-2022.