Defendant’s counsel backed out of an oral settlement agreement and then failed to timely respond to plaintiff’s cross-complaint seeking to enforce that agreement. The trial court entered defendant’s default on the cross-complaint. Defendant moved to set aside the default under the mandatory relief provision of Code of Civil Procedure section 473, subdivision (b), but the court denied the motion, finding that defendant’s failure to respond to the cross-complaint resulted from his attorneys’ deliberate litigation strategy—not from neglect or mistake.
The Court of Appeal reversed, holding that mandatory relief under Code of Civil Procedure section 473, subdivision (b) is available even where an attorney’s default results from a deliberate strategic decision. The court emphasized that the mandatory relief provision of section 473 protects innocent clients from defaults caused by their attorneys, even where the attorney’s actions are intentional or in bad faith. The court reasoned that so long as the client was not involved in the alleged misconduct, relief is mandatory.
