Opinion
NOT TO BE PUBLISHED
Appeal from a judgment of the Superior Court of Orange County No. 06CC07700 Clay M. Smith, Judge.
The Krolikowski Law Firm and Adam J. Krolikowski for Defendants and Appellants.
Law Offices of Paul H. Sweeney and Paul H. Sweeney for Plaintiff and Respondent.
OPINION
MOORE, J.
Several parties to a defamation action entered into a court-approved settlement agreement. When the settling defendants’ first payment was due under the settlement agreement, they provided a postdated check to which was attached a note indicating that funds would not be available until a date three days after the expiration of the grace period. Rather than waiting for funds to become available, the plaintiff sought and obtained entry of judgment pursuant to the settlement agreement. The settling defendants appeal.
We affirm. We reject both the assertion that the settling defendants did in fact timely perform and the assertion that they were excused from performance. Furthermore, the settling defendants have waived their argument concerning the improper imposition of liquidated damages, for failure to cite to legal authority. Finally, having settled the case, it is too late for the settling defendants to argue that their anti-SLAPP motion should have been granted.
I
FACTS
Mary Ann Mashita (Mashita) filed a complaint for defamation, intentional infliction of emotional distress, and negligent infliction of emotional distress, against Bogdan C. Maglich (Maglich), Maglich Family Holdings, Inc., and HiEnergy Technologies, Inc. Maglich and Maglich Family Holdings, Inc. (the settling defendants) filed an anti-SLAPP motion pursuant to Code of Civil Procedure section 425.16. In September 2006, the court denied the motion, explaining that Mashita had met her burden to show that the evidence presented, if believed, would support a judgment that defendants, with the intent to harm Mashita, had made false and defamatory statements to a third party.
In May 2007, Mashita and the settling defendants entered into a settlement agreement that was approved by the court. The settlement agreement provided that a judgment in the amount of $35,000 could be entered against the settling defendants, jointly and severally. It also provided that no judgment would be filed, however, if the settling defendants paid a total of $20,000 to Mashita pursuant to a specified payment schedule. The schedule required the settling defendants to pay Mashita $5,000 no later than June 25, 2007, plus $1,500 per month for ten months beginning July 25, 2007. The settlement agreement also provided that if after the expiration of a five-day grace period any “payment [had] not actually been received,” plaintiff had the right to file an ex parte motion with the court, and a judgment would be entered in the amount of $35,000, minus any payments already received.
For the initial payment, Maglich timely delivered to Mashita’s attorney a $5,000 check dated July 3, 2007, drawn on a Bank of America account in Maglich’s name. Attached to the check was a note stating, “note the date of availability of funds[.]” An arrow on the note pointed to the July 3, 2007 date. By priority mail postmarked June 30, 2007, Mashita’s attorney received from Maglich a second $5,000 check, also dated July 3, 2007, this time drawn on a Citibank account in Maglich’s name. Also in the envelope was a letter requesting that the attorney replace the first check with the second check, and return the first check.
Mashita filed an ex parte application for entry of judgment in the amount of $35,000, asserting that the settling defendants had not made the first payment within the period of time required by the settlement agreement. The settling defendants opposed the motion, claiming both lack of material breach and impossibility of performance, stating that Bank of America had “raided” Maglich’s account to satisfy the debt of HiEnergy Technologies, Inc., thus leaving the settling defendants unable to make the $5,000 payment in a timely fashion. The court entered a judgment in the amount of $35,000 in favor of Mashita and against the settling defendants. The settling defendants appeal.
II
DISCUSSION
A. Introduction:
The settling defendants argue: (1) Maglich did in fact perform his obligations under the settlement agreement, so the entry of judgment was improper; (2) performance was excused; (3) there was no material breach to warrant liquidated damages; and (4) the trial court erred in denying their anti-SLAPP motion. We address these contentions in turn.
B. Performance:
The settlement agreement clearly provided that the first payment, in the amount of $5,000, was due on June 25, 2007. It also provided for a five-day grace period, making June 30, 2007 the final date for payment.
The first check was received before June 30, 2007, but the second check was not mailed until that date. Both the first check and the second were dated July 3, 2007. The settling defendants, citing Wright v. Bank of America (1959) 176 Cal.App.2d 176, 180, concede that a postdated check is “payable on or at any time after the day of its date,” and Mashita certainly agrees. Thus, based on the settling defendants’ own admission, the checks could not have been cashed before July 3, 2007.
Mashita also cites In re Plaza Hotel Corp. (1990) 111 B.R. 882, 887, which relied on former California Uniform Commercial Code section 3114. However, we observe that current California Uniform Commercial Code sections 3113, subdivision (a), and 4401, subdivision (c), cited by neither party, now permit a bank to charge an account of the drawer in advance of the date of the check under certain circumstances, dependent upon communications between the drawer and the bank. Not being privy to the dealings between Maglich and his banks, we are not in a position to determine whether in fact either bank could have cashed the apposite check in advance of July 3, 2007, without suffering liability. It is noteworthy, however, that Maglich, who obviously is cognizant of his own dealings with those banks, asserts that each respective check could have been cashed on or after its date. Thus, we need not belabor the issue.
This notwithstanding, the settling defendants maintain that the checks in question were still valid instruments when Mashita received them, and that she held title to them as of receipt. They also contend that Mashita could have transferred title to the checks before July 3, 2007.
The settling defendants are correct that the checks were not invalid merely because they were postdated. (Cal. U. Com. Code, § 3113, subd. (a).) They are also correct that Mashita could have transferred title to the checks before July 3, 2007, had she chosen to do so and had she located a willing transferee. (Cf. Cal. U. Com. Code, § 3113, subd. (a); Wilson v. Lewis (1980) 106 Cal.App.3d 802, 808; American Nat. Bank v. Wheeler (1919) 45 Cal.App. 118, 119.) However, the fact that the checks were not invalid and could have been transferred does not mean that Mashita could have cashed them within the grace period.
Perhaps more importantly, Maglich, via the handwritten note that was attached to the Bank of America check, alerted Mashita’s attorney to the fact that there were insufficient funds in the Bank of America account to cash the check before the expiration of the grace period. So, no matter the legal effect of the date written on the Bank of America check, as a practical matter, the check could not have been cashed before the expiration of the grace period. The Citibank check was substituted only after the expiration of the grace period, and was postdated July 3, 2007 in any event. Substantial evidence supports the trial court’s implied finding that payment was not made to Mashita within the grace period, so that she was entitled to entry of judgment in the amount of $35,000 pursuant to the settlement agreement. (Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1360 [substantial evidence standard of review on enforcement of settlement agreement].)
C. Impossibility or Other Excuse:
While the settling defendants insist, on the one hand, that they performed the terms of the settlement agreement, they also maintain that it was impossible for them to do so. They claim, without evidentiary support, that “Dr. Maglich had his bank account drained by Bank of America to pay debts owed by Hienergy Technologies, Inc. on or about June 25, 2007.” They further claim that it was impossible for Maglich to pay money that had been seized from his account. They also contend that they are excused from performance pursuant to Civil Code sections 3526, 3531, and 1511.
Civil Code section 3526 provides: “No man is responsible for that which no man can control.” Civil Code section 3531 states: “The law never requires impossibilities.” The settling defendants cite no authority characterizing an empty bank account as a matter beyond the control of man, within the meaning of section 3526. They also cite no authority interpreting section 3531 as meaning that one who runs out of money is excused from paying liabilities as they become due. And significantly, the settling defendants cite no evidence to show that Bank of America drained the account in question on or about June 25, 2007, that Maglich had no other source of payment, such as the Citibank account, or that Maglich Family Holdings, Inc., which was also liable under the settlement agreement, had no funds available to make the payment to Mashita. The settling defendants have not demonstrated a viable defense on the ground of impossibility.
Turning next to Civil Code section 1511, that statute provides: “The want of performance of an obligation, . . . or any delay therein, is excused by the following causes, to the extent to which they operate: [¶] 1. When such performance . . . is prevented or delayed by the act of the creditor, or by the operation of law . . .; [¶] 2. When it is prevented or delayed by an irresistible, superhuman cause, or by the act of public enemies of this state or of the United States . . .; or, [¶] 3. When the debtor is induced not to make it, by any act of the creditor . . . .”
Citation to this statute does not help the settling defendants. They have not shown how their performance was prevented or delayed by Mashita as the creditor, or how she induced their lack of performance. They also have not shown how their performance was prevented or delayed by operation of law, by a superhuman cause, or by the act of public enemies.
The settling defendants, citing United States v. Hollingshead (9th Cir. 1982) 672 F.2d 751 (Hollingshead), assert that Bank of America is an instrumentality of the United States. Although they do not articulate how such a characterization relates to Civil Code section 1511, we presume they mean to say that the acts of Bank of America constituted the operation of law that prevented their performance. Hollingshead does not provide support for that assertion. Rather, that case provided that an employee of the Los Angeles Branch of the Federal Reserve Bank of San Francisco was a “public official” for the purposes of the application of certain federal bribery statutes. (Id. at pp. 752-754.) That case also made note of “the federal character of the federal reserve banks.” (Id. at p. 754.) The settling defendants have not explained how it is that the local Bank of America branch shares “the federal character of the federal reserve banks.” They certainly have not shown that the local Bank of America branch is an instrumentality of the United States whose acts constitute the operation of law. With equal certainty, they have not demonstrated that the local Bank of America branch is a superhuman entity or a public enemy. Civil Code section 1511 simply does not afford them relief.
D. Materiality/Liquidated Damages:
The settling defendants say that the delivery of a postdated check just a couple of days before funds were available upon which it could have been drawn could not have constituted a material breach. They also assert that liquidated damages cannot be imposed unless a material breach has occurred. They do not articulate how it is that the entry of judgment constituted the imposition of liquidated damages. Perhaps they construe the court-approved settlement agreement to mean that the parties agreed to a settlement amount of $20,000, but if payment was not timely made, an additional sum of $15,000 in liquidated damages would be imposed. On the other hand, the settlement agreement could also be construed to mean that the parties agreed to a $35,000 award, but the amount would be discounted to $20,000 provided that smaller amount was paid according to the specified schedule.
The settling defendants cite no authority in support of the argument that the entry of judgment constituted the improper imposition of liquidated damages. Their argument is waived for failure to cite legal authority. (Roden v. AmerisourceBergen Corp. (2007) 155 Cal.App.4th 1548, 1575-1576.)
E. Anti-SLAPP Motion:
Lastly, the settling defendants argue the trial court erred in denying their anti-SLAPP motion. It is too late for them to raise this issue, for they have already settled the case. The settlement agreement “‘is decisive of the rights of the parties and serves to bar reopening of the issues settled.’” (Brown & Bryant, Inc. v. Hartford Accident & Indemnity Co. (1994) 24 Cal.App.4th 247, 255.)
III
DISPOSITION
The judgment is affirmed. Mashita shall recover her costs on appeal.
WE CONCUR: SILLS, P. J., BEDSWORTH, J.