Opinion
NOT TO BE PUBLISHED
APPEAL from the Superior Court of Riverside County, No. INC057176, Randall Donald White, Judge.
Juanita Roibal-Bradley, in pro. per., for Cross-defendant and Appellant.
Law Offices of Model & Yoss and Jeffrey M. Yoss for Cross-complainant and Respondent.
OPINION
McKinster, Acting P.J.
Cross-defendant and appellant Juanita Roibal-Bradley (Bradley) appeals after the trial court granted a motion to enforce a settlement agreement. Bradley complains that the settlement agreement was not agreed to personally by all parties, and that the enforcement motion was therefore improper. We reverse.
FACTS AND PROCEDURAL HISTORY
Cross-complainant and respondent Diana S. Wood (Wood) owned a condominium in the Mesquite Country Club condominium complex. The Mesquite Country Club Condominium Homeowners Association (HOA) filed suit against Wood and Michelle Andreas (Andreas) for declaratory and injunctive relief as well as monetary damages. The HOA claimed that additional police patrol expenses were attributable to Andreas’s occupancy of Wood’s condominium unit because of ongoing illegal activity at the unit.
Wood answered the HOA’s complaint, and cross-complained against Bradley (Wood’s sister) and Andreas, for indemnity and contribution. Wood had apparently allowed Bradley to occupy the condominium unit, and Bradley in turn had improperly subleased to Andreas. During Andreas’s occupancy, young people dressed in gang attire were coming and going at all hours of the day and night, and guests were involved in illegal activities relating to stolen property.
In December 2006, Wood settled with the HOA on the complaint, after a payment of $32,000. Wood continued to pursue contribution and indemnification from Bradley and Andreas, however. On January 5, 2007, the parties engaged in settlement negotiations before Judge Fry. Bradley agreed that Wood would be paid a total of $14,000, but wanted each of the cross-defendants to be responsible only for paying $7,000 apiece. Wood declined this arrangement. She was concerned about the reliability of each cross-defendant, and wanted recourse for the whole amount against each. Thus, Wood would not agree to settle the case unless a single payment of $14,000 was made by a certain date, and unless Bradley and Andreas accepted joint and several liability for the payment.
On January 17, 2007, Wood’s counsel sent a letter to counsel for Bradley and Andreas. Both cross-defendants were represented by the same attorney. The letter memorialized the settlement agreement reached on January 12, 2007. The terms called for a single check in the amount of $14,000 to be paid on or before April 30, 2007. If the check were not received by that date, Wood would seek a judgment against Bradley and Andreas jointly and severally. The letter recited, “If these terms are acceptable to you, we wish to put this on the court’s record at the [case management conference] scheduled for this Friday, January 19, 2007.”
On January 19, 2007, the attorneys for the parties appeared in court. Wood was also present in court. Bradley and Andreas were to appear telephonically. Bradley’s attorney inquired whether both were present, but the party on the telephone related that, “unfortunately Miss Andreas has not arrived yet. [Ms.] Bradley is here.” Bradley’s attorney acknowledged that, “we do have joint and several liability on this settlement, so we can proceed.”
Wood’s counsel read out the settlement agreement: “A single check in the amount of $14,000 is to be paid on or before April the 30th, 2007. The check is to be made out to Diana S. Wood. [¶] If the check is not received by the foregoing date, plaintiff [sic] Diana S. Wood will seek a judgment against . . . Bradley and . . . Andreas jointly and severally and will seek attorney fees, costs and interest[] from the date of the breach. [¶] . . . Once the settlement check is received, . . . cross-complainant will file a dismissal with prejudice of her cross-complaint against both cross-defendants. Both parties agree to a mutual release and a waiver of Civil Code Section 1542. [¶] . . . [¶] Each party to bear its own attorney fees and costs. [¶] No party admits liability or wrongdoing.”
Bradley’s counsel affirmed the terms of the agreement, and inquired of Bradley whether she understood the terms of the agreement. Bradley affirmed, “I did,” but clarified the payment date. She specifically stated, “I do understand” the terms of the settlement. She also personally acknowledged her understanding that, “once this case is settled, it’s over forever, and you’ll have no ability to come in and—and argue your position.”
On April 30, 2007, Bradley sent a check, made out not to Wood, but to Wood’s attorney, in the amount of $7,000. Because Bradley and Andreas breached the agreement for a single payment of $14,000, Wood moved for an order entering judgment against both cross-defendants, pursuant to Code of Civil Procedure section 664.6.
Bradley opposed the motion, contending that summary enforcement of the settlement under Code of Civil Procedure section 664.6 was unavailable, because Andreas had not agreed personally on the record to the settlement terms.
The trial court, after reviewing the transcript of the stipulated settlement hearing, granted Wood’s motion to enforce the settlement. Bradley moved for reconsideration, which the court also denied.
Bradley appeals, renewing her argument that expedited enforcement procedures under Code of Civil Procedure section 664.6 were unavailable, because fewer than all the parties to the stipulation agreed to the settlement, either by personal assent on the record in open court or by signing a writing.
ANALYSIS
I. Standard of Review
As Bradley points out, the question whether the statutory requirements of Code of Civil Procedure section 664.6 have been met is a question of law, which we review independently. (Conservatorship of McElroy (2002) 104 Cal.App.4th 536, 544 (McElroy).) On the other hand, the trial court’s determination of whether the parties entered into a binding settlement agreement in open court is reviewed under the substantial evidence standard of review. (In re Marriage of Assemi (1994) 7 Cal.4th 896, 911; McElroy, at p. 544.) That determination depends upon the trial court’s consideration of the issues whether the material terms of the settlement were explicitly defined, whether the presiding officer inquired of the parties as to their understanding of the terms, and the parties made express acknowledgement of their understanding of the terms. (McElroy, at p. 544.)
II. The Expedited Enforcement Mechanism of Code of Civil Procedure Section 664.6 Is Unavailable Where the Evidence Does Not Show That All Parties Agreed to the Settlement
Bradley urges that, because fewer than all of the parties to the settlement agreement gave personal assent on the record in open court (or alternatively in writing), the expedited enforcement procedure of Code of Civil Procedure section 664.6 is unavailable, and the trial court improperly permitted the agreement to be enforced against her by that procedure.
Code of Civil Procedure section 664.6 provides: “If parties to pending litigation stipulate, in a writing signed by the parties outside the presence of the court or orally before the court, for settlement of the case, or part thereof, the court, upon motion, may enter judgment pursuant to the terms of the settlement. If requested by the parties, the court may retain jurisdiction over the parties to enforce the settlement until performance in full of the terms of the settlement.”
In Levy v. Superior Court (1995) 10 Cal.4th 578 (Levy), the California Supreme Court held that the term “parties” in the statute refers to the litigants themselves. (Id. at p. 584.) In other words, the litigant himself or herself must personally sign the writing or agree in open court; the agreement or signature of the litigant’s attorney is insufficient to qualify for the expedited enforcement procedures provided by the section.
As Bradley points out, cross-defendant Andreas was not present when the settlement was placed on the record and she did not personally express assent to it at the settlement hearing. Wood argues, however, that she was not seeking to enforce the settlement agreement against Andreas; rather, she sought to enforce it against Bradley, who was present in court (telephonically) and did express explicit understanding and acceptance of the terms of the settlement.
The holding in Levy was not that the failure of a party to express personal assent in a particular manner invalidated the settlement under all circumstances, or was sufficient to resist all means of enforcement. Rather, the holding was that the expedited enforcement mechanism of Code of Civil Procedure section 664.6 was unavailable. The California Supreme Court did not rule out other proceedings to enforce a settlement: “We note that this statutory procedure is not the exclusive means to enforce a settlement. (See Kilpatrick v. Beebe (1990) 219 Cal.App.3d 1527, 1529.) Alternative procedures are a motion for summary judgment, a separate suit in equity, or an amendment to the pleadings in this action.” (Levy, supra, 10 Cal.4th at p. 586, fn. 5.) Wood may fully avail herself of these alternative remedies to enforce the settlement against Andreas.
Whether she is required to do so, however, depends upon our consideration of other issues.
The crux of the decision in Levy was the authority of the attorney to bind the client to a settlement agreement. “‘“[T]he client as principal is bound by the acts of the attorney-agent within the scope of his actual authority (express or implied) or his apparent or ostensible authority; or by unauthorized acts ratified by the client.” [Citations.]’ [Citation.] However, an attorney is not authorized merely by virtue of his retention in litigation to ‘impair the client’s substantial rights or the cause of action itself.’ [Citation.]” (Knabe v. Brister (2007) 154 Cal.App.4th 1316, 1323 (Knabe).) The Knabe court pointed out that, although the California Supreme Court has not comprehensively determined what is a “substantial right” requiring individual consent of the client, “[t]he right to settle a case is a substantial right, and a written stipulation to settle a case and enter judgment pursuant to Code of Civil Procedure section 664.6 must be signed by the party litigant.” (Knabe, at p. 1324, citing Levy, supra, 10 Cal.4th at pp. 582-584, italics added.) The Knabe court also noted that “[a]n attorney has no authority to stipulate over his or her client’s objection that the case be submitted to binding arbitration. [Citation.] He or she also has no authority to stipulate over his or her client’s objection that, after a mistrial due to the trial judge’s disability, the case could be decided by a different judge entirely on the basis of the previous record. [Citation.]” (Knabe, at p. 1324, italics added.) Such principles do not, however, limit the authority of the attorney who compromises a case, or stipulates to arbitration, or agrees to decision by another judge, where the client has granted the authority to do so. (See, e.g., Security Loan & Trust Co. v. Estudillo (1901) 134 Cal. 166, 168; Clemens v. Gregg (1917) 34 Cal.App. 245, 253 [recognizing the general rule that an attorney may not compromise the case without the client’s consent, but the evidence showed authorization or ratification].)
As noted in our discussion of the standard of review, on a motion to enforce a settlement or stipulated judgment, the trial court may make factual findings, which we review under the substantial evidence standard. We have no evidence and no findings in the present proceeding, however, about Andreas’s agreement to the settlement (other than her failure to agree personally on the record in open court) or the authorization she gave to her attorney. We do note that she was represented by the same attorney as Bradley.
If we permitted expedited enforcement of the agreement by Wood against Bradley, but relegated Bradley to the alternative modes of enforcement against Andreas, the evidence might show that Andreas not only did not consent personally on the record to the settlement, but also that she did not consent to the terms of the settlement at all, either by granting authority to her attorney, by ratification or by other means. If that turned out to be the case, then there would have been no agreement among all the parties to the lawsuit, and in particular no agreement by both Bradley and Andreas to joint and several liability. It may well be the case, as Bradley hints, that she would not have agreed to joint and several liability for herself, in the absence of Andreas’s agreement to be jointly and severally liable also. Thus, there would be a failure of the settlement in terms of Bradley’s recourse or enforcement against Andreas, while enforcing the settlement’s provision of joint and several liability in favor of Wood against Bradley.
On the other hand, certain circumstances of the case cause concern. Bradley is not an unsophisticated litigant. She is an administrative law judge in another jurisdiction (New Mexico). She knows what “joint and several liability” means. She also knew at the time the settlement agreement was placed on the record that Andreas was not present and did not personally and expressly (at that time) agree to its terms. Under those conditions, Bradley nevertheless expressly averred on the record that she accepted joint and several liability for the $14,000 obligation. She could have been under no apprehension or illusion that she herself only owed $7,000. The settlement agreement itself provided for a single payment of the entire $14,000. Bradley had to know that one payment of $7,000 would not comply with the terms of the settlement.
Bradley complained in her opposition papers that Wood was not pursuing Andreas, that Bradley herself had had difficulty keeping in touch with Andreas, and that Bradley did not successfully get Andreas to contribute to the settlement payment by the due date. These complaints cut both ways, however. Bradley’s recognition that she is unlikely to succeed in getting contribution from Andreas is precisely why Wood would not settle for anything other than joint and several liability from Bradley. Knowing what she knew about Andreas, Bradley nevertheless did expressly and unequivocally accept joint and several liability on the record.
Nonetheless, we are left with the prospect of unequal enforceability of the judgment, if the settlement could be summarily enforced by Wood against Bradley, but could be held wholly invalid (i.e., no settlement at all) as to Andreas. There might have been evidence presented below to show that all parties had agreed to the settlement, even if not all had done so in compliance with the summary enforcement provisions of Code of Civil Procedure section 664.6. For example, Bradley could have agreed personally on the record (as she did), but Andreas agreed by authorization of her attorney and ratification of the agreement. Under those circumstances, expedited enforcement by one party (Wood against Bradley), and alternative enforcement by another (Bradley against Andreas), would not be problematic. But we do not have any such evidence on this record, as to Andreas’s ultimate agreement to the settlement. In the absence of such evidence, there are no factual findings concerning Andreas’s agreement to the settlement. In the absence of any findings concerning Andreas’s agreement to the settlement, the potential failure of consideration for Bradley’s stipulation presents the prospect of the failure of the settlement agreement in its entirety, and prevents expedited enforcement under Code of Civil Procedure section 664.6.
That does not mean to say that the settlement agreement did fail, or that it is ultimately unenforceable as to Bradley; rather, the evidence is insufficient on this record to support expedited enforcement. Wood may nevertheless seek to enforce the settlement by the alternative means stated: summary judgment, a separate suit in equity, or amendment of the underlying pleadings.
DISPOSITION
The order for entry of judgment and the judgment are reversed with directions to the trial court to deny the motion for expedited enforcement under Code of Civil Procedure section 664.6. This ruling is without prejudice to alternative procedures to determine whether a settlement was reached by all parties, and to enforce any such settlement agreement, including entry of judgment. In the interests of justice, each party is to bear its own costs on appeal.
We concur: Gaut J., King J.