gno.law

Berkes v. San Diego Foreclosure Services, Inc. CA4/1

California Court of Appeal · D050488 · 2013-09-13 · Unpublished

Proceeding
appeal from a judgment
Trial court
Superior Court of San Diego County · No. GIN037150
Trial judge
Joel M. Pressman
Outcome
reversed — Reversed as moot and remanded with directions.
Area
civil
Panel
O'Rourke (author), Richard D. Huffman, Sr., Judith D. McConnell

Analysis

A model's reading — qwen3.8-27b, prompt v1, 2026-10-13T06:50Z · confidence high

The trial court sustained a demurrer to the plaintiffs' third amended complaint without leave to amend, entering judgment in favor of the defendant San Diego Foreclosure Services, Inc. (SDFS). On appeal, the Court of Appeal reversed the judgment as moot and remanded with directions to dismiss the action against SDFS because the corporation had dissolved following bankruptcy and ceased to exist.

Ruling reviewedStandardThe courtThe model
Sustaining demurrer to third amended complaint without leave to amend
“appeal from a judgment entered in favor of defendant San Diego Foreclosure Services, Inc. (SDFS) after the court sustained without leave to amend a demurrer to plaintiffs' third amended complaint”
unclearnot reachedunsure
The appellate court did not review the merits of the trial court's ruling on the demurrer because it determined the appeal was moot. The court explicitly stated, 'We express no opinion on the merits of the appeal,' and reversed the judgment solely to return jurisdiction to the trial court for dismissal. Therefore, the correctness of the trial court's application of law to the demurrer is not addressed in this opinion.

Authorities

  • relied: Paul v. Milk Depots, Inc. (1964) 62 Cal.2d 129 — Establishes that when a defendant's bankruptcy and cessation of business render a proceeding moot, the proper disposition is to reverse the judgment with directions to dismiss to avoid implying approval of the unreviewed judgment.
  • relied: Eye Dog Foundation v. State Bd. of Guide Dogs for Blind (1967) 67 Cal.2d 536 — States the duty of courts to decide actual controversies and not give opinions on moot questions or abstract propositions.
  • relied: Catholic Mut. Relief Soc. v. Superior Court (2007) 42 Cal.4th 358 — Identifies the three discretionary exceptions to mootness: issues likely to recur, issues of broad public interest, or material questions remaining for determination.
  • relied: Coalition for a Sustainable Future in Yucaipa v. City of Yucaipa (2011) 198 Cal.App.4th 939 — Extensively discusses Paul v. Milk Depots and the reason for reversing with directions to dismiss in moot cases.
  • relied: Bell v. Board of Supervisors (1976) 55 Cal.App.3d 629 — Explains that reversal with directions to dismiss is the equivalent of dismissal of the appeal but avoids the ambiguity of leaving a subsisting trial court judgment in place.

The appellate opinion: sound — The opinion is procedurally sound as it correctly applies the mootness doctrine to a dissolved corporate defendant, citing established California authority (Paul v. Milk Depots) for the specific remedy of reversing with directions to dismiss. It properly identifies that no exceptions to mootness apply and avoids the error of affirming a judgment on the merits when the party no longer exists.

How this analysis was made · dispute it

unusual disposition

A model's reading — claude-fable-5-1, prompt v1, 2026-10-13T04:31Z · confidence low

The trial court sustained without leave to amend San Diego Foreclosure Services, Inc.'s demurrer to plaintiffs' third amended complaint for quiet title and other relief and entered judgment for that defendant in January 2005. After bankruptcy stays were lifted and counsel reported that SDFS had been liquidated in chapter 7, dissolved, and had no one able to act for it, the Court of Appeal held the appeal moot, declined to reach the merits, and reversed the judgment solely to return jurisdiction with directions to dismiss the action against SDFS under Paul v. Milk Depots.

Ruling reviewedStandardThe courtThe model
Order sustaining SDFS's demurrer to the third amended complaint without leave to amend and resulting judgment for SDFS
“The proper disposition, to avoid impliedly affirming a judgment that we have not reviewed on the merits, is to reverse it with directions to the trial court to dismiss the case as moot.”
unclearnot reachedagree with court
The court never reviewed the demurrer ruling; it found the appeal moot because SDFS had been liquidated in bankruptcy, was de jure dissolved, its sole officer had died, and no effectual relief could be granted against it. The court correctly considered the three discretionary exceptions to mootness and found none applied, with plaintiffs' counsel offering no response. Following Paul v. Milk Depots and its progeny, reversing with directions to dismiss rather than dismissing the appeal is the established California procedure to avoid leaving a subsisting judgment that was never reviewed on the merits. The reasoning and cited authorities support the disposition, though the opinion gives little factual detail and relies on a prior unpublished opinion for background.

Authorities

  • relied: Paul v. Milk Depots, Inc. (1964) 62 Cal.2d 129 — When an appeal becomes moot through events such as the defendant's bankruptcy and cessation of business, the proper disposition is to reverse the judgment with directions to dismiss, a procedural step that implies no approval of a contrary judgment.
  • relied: Eye Dog Foundation v. State Bd. of Guide Dogs for Blind (1967) 67 Cal.2d 536 — Courts decide actual controversies and will not proceed to judgment where an event pending appeal makes it impossible to grant effectual relief.
  • relied: Catholic Mut. Relief Soc. v. Superior Court (2007) 42 Cal.4th 358 — Discretionary exceptions to mootness exist for issues likely to recur, issues of broad public interest, or where a material question remains for determination.
  • relied: Coalition for a Sustainable Future in Yucaipa v. City of Yucaipa (2011) 198 Cal.App.4th 939 — Explains the Paul rule and why a moot appeal should be resolved by reversal with directions to dismiss rather than dismissal of the appeal.
  • relied: Giles v. Horn (2002) 100 Cal.App.4th 206 — When an appeal is disposed of as moot without reaching the merits, the preferable procedure to avoid ambiguity is to reverse with directions to dismiss the action.
  • relied: Bell v. Board of Supervisors (1976) 55 Cal.App.3d 629 — Reversal with directions to dismiss is equivalent to dismissal of the appeal but avoids leaving a subsisting trial court judgment in a moot case.

The appellate opinion: sound — The court applied the settled mootness doctrine, considered and rejected the recognized exceptions, and followed the Supreme Court's Paul v. Milk Depots procedure of reversing with directions to dismiss so that an unreviewed judgment does not stand. The opinion is brief and depends on counsel's representations about the bankruptcy and dissolution rather than record facts set out in the opinion, but it addresses the only question presented with the correct authorities.

How this analysis was made · dispute it

record incomplete

Opinion

Filed 9/13/13 Berkes v. San Diego Foreclosure Services, Inc. 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

JASON E. BERKES et al., D050488 Plaintiffs and Appellants, v. (Super. Ct. No. GIN037150)

SAN DIEGO FORECLOSURE SERVICES, INC. et al., Defendants and Respondents.

APPEAL from a judgment of the Superior Court of San Diego County, Joel M.

Pressman, Judge. Reversed as moot and remanded with directions.

Law Office of Bryan Pease and Bryan William Pease for Plaintiffs and Appellants.

McCarthy & Holthus, Terry Loftus for Defendant and Respondent San Diego Foreclosure, Services, Inc.

Plaintiffs and appellants Jason E. Berkes, Wendy L. Berkes, Jason E. Berkes, Trustee of the Jason E. Berkes and Wendy Lee Berkes 2002 Family Trust and SeaSilver USA, Inc. appeal from a judgment entered in favor of defendant San Diego Foreclosure Services, Inc. (SDFS) after the court sustained without leave to amend a demurrer to plaintiffs' third amended complaint seeking, inter alia, quiet title to certain residential property. Because the matter has become moot, we will reverse the judgment as to SDFS and direct the trial court to dismiss the underlying action against it. (Paul v. Milk Depots, Inc. (1964) 62 Cal.2d 129, 134.)

FACTUAL AND PROCEDURAL BACKGROUND

The basic underlying facts and procedure in this matter are set forth in our prior unpublished opinion on plaintiffs' consolidated appeals (Berkes v. San Diego Foreclosure Services, Inc. et al. (Oct. 3, 2006, D046224, D047346) [nonpub. opn.]), and we need not repeat them here other than to say that in January 2005, the trial court entered a judgment in favor of SDFS on plaintiffs' third amended complaint for quiet title and other relief, from which plaintiffs' appealed.

In May 2006 and March 2007, this court issued orders staying the appeal of all proceedings against SDFS under the automatic stay of section 362 of the Bankruptcy Code (11 U.S.C. § 362). After counsel advised us that the bankruptcy case had closed, we vacated those stay orders in June 2012.

Thereafter, counsel of record for SDFS1 notified this court that (1) the bankruptcy 1 Attorney Terry Loftus advised us he "has no client" in connection with this matter, but neither he nor counsel for plaintiffs have filed a substitution or motion to withdraw as counsel. (Cal. Rules of Court, rule 8.36(b) & (c).) Consequently, they remain counsel of record for the parties in this appeal. 2 proceeding had been converted to a chapter 7 bankruptcy and had closed on April 3, 2012; (2) SDFS, a corporation, did not emerge from bankruptcy upon completion of the case; (3) corporations in this position are de jure dissolved and cease to function; (4)

SDFS's sole officer and director, Sally Clark, died just prior to the filing of the involuntary chapter 11; and (5) there is no person or entity able to respond to the current appeal on behalf of SDFS.

We directed the parties' counsel of record to inform us why the appeal was not moot in light of the above-referenced matters, and why the appeal should otherwise go forward. Plaintiffs' counsel did not respond; counsel for SDFS advised us that the appeal was "prudentially moot."

DISCUSSION

" ' "[T]he duty of this court, as of every other judicial tribunal, is to decide actual controversies by a judgment which can be carried into effect, and not to give opinions upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before it." ' [Citation.] . . . 'It necessarily follows that when, pending an appeal from the judgment of a lower court, and without any fault of the defendant, an event occurs which renders it impossible for this court, if it should decide the case in favor of plaintiff, to grant him any effectual relief whatever, the court will not proceed to a formal judgment, but will dismiss the appeal.' "

(Eye Dog Foundation v. State Bd. of Guide Dogs for Blind (1967) 67 Cal.2d 536, 541;

see In re Esperanza C. (2008) 165 Cal.App.4th 1042, 1054; La Jolla Cove Motel and Hotel Apartments, Inc. v. Superior Court (2004) 121 Cal.App.4th 773, 781.) "The policy 3 behind a mootness dismissal is that 'courts decide justiciable controversies and will normally not render advisory opinions.' " (Giraldo v. Department of Corrections & Rehabilitation (2008) 168 Cal.App.4th 231, 257.)

There are three discretionary exceptions that would permit us to nevertheless consider this appeal: when issues are likely to recur, when the issues are of broad public interest, or when a material question remains for the court's determination. (See Catholic Mut. Relief Soc. v. Superior Court (2007) 42 Cal.4th 358, 365, fn. 5; Environmental Charter High School v. Centinela Valley Union High School District (2004) 122 Cal.App.4th 139, 144.) None of these exceptions apply here.

Under the circumstances, the appeal as to SDFS is moot. (See, e.g., Paul v. Milk Depots, Inc., supra, 62 Cal.2d at pp. 132-133 [proceeding to enforce marketing regulation rendered moot by defendant's bankruptcy and cessation of business].) There is no longer any actual controversy upon which a judgment could operate nor effectual relief that could be granted to any party. (Id. at p. 132.) The proper disposition, to avoid impliedly affirming a judgment that we have not reviewed on the merits, is to reverse it with directions to the trial court to dismiss the case as moot. (Id. at pp. 134-135, see Coalition for a Sustainable Future in Yucaipa v. City of Yucaipa (2011) 198 Cal.App.4th 939 [extensively discussing Paul and the reason for such disposition]; Wilson & Wilson v. City Council of Redwood City (2011) 191 Cal.App.4th 1559, 1585-1586; Giles v. Horn (2002) 100 Cal.App.4th 206, 229 [when an appeal is disposed of on the ground of mootness without reaching the merits, in order to avoid ambiguity, the preferable procedure is to reverse with directions to the trial court to dismiss the action]; County of 4 San Diego v. Brown (1993) 19 Cal.App.4th 1054, 1090.) "Reversal with directions to the trial court to dismiss is the equivalent of dismissal of the appeal, but avoids the ambiguity of the latter procedure which does not dispose of a subsisting trial court judgment in a case wherein the issues are moot." (Bell v. Board of Supervisors (1976) 55 Cal.App.3d 629, 637.) This type of reversal "does not imply approval of a contrary judgment . . . [it]

is merely a procedural step necessary to a proper disposition of this case." (Paul, 62 Cal.2d at p. 135.) We express no opinion on the merits of the appeal.

DISPOSITION

The judgment as to San Diego Foreclosure Services, Inc. is reversed solely for the purpose of returning jurisdiction to the superior court. The matter is remanded with directions to the superior court to dismiss the underlying action against San Diego Foreclosure Services, Inc. The parties shall bear their own costs on appeal.

O'ROURKE, J.

WE CONCUR:

McCONNELL, P. J.

HUFFMAN, J.

Cites, in this corpus