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Mejia v. Jhan, Inc.

COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION EIGHT
Jan 10, 2012
B230818 (Cal. Ct. App. Jan. 10, 2012)

Opinion

B230818

01-10-2012

GILDA C. MEJIA, Plaintiff and Respondent, v. JHAN, INC., et al., Defendants and Appellants.

Mito Law and Justin G. Lynch for Defendants and Appellants. Law Offices of Joseph M. Lovretovich, Joseph M. Lovretovich and Christopher W. Taylor for Plaintiff and Respondent.


NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

(Los Angeles County Super. Ct. No. BC423369)

APPEAL from the judgment of the Superior Court of Los Angeles County. Daniel J. Buckley, Judge. Affirmed.

Mito Law and Justin G. Lynch for Defendants and Appellants.

Law Offices of Joseph M. Lovretovich, Joseph M. Lovretovich and Christopher W. Taylor for Plaintiff and Respondent.

Defendants and appellants Jhan, Inc., and Janice Bautista (Jhan Defendants) appeal from the judgment entered on a written stipulation for settlement following the court's granting of plaintiff and respondent Gilda C. Mejia's motion pursuant to Code of Civil Procedure, section 664.6 (section 664.6). We conclude substantial evidence supports the court's order enforcing the written settlement and therefore affirm.

Mejia, a home health care worker, brought this action against the Jhan Defendants for failure to pay minimum wages in violation of Labor Code, section 1194, along with other alleged statutory violations. The Jhan Defendants contested Mejia's allegations, contending Mejia was not an employee but an independent contractor, as were all of the several hundred home care workers with whom they worked.

A week before trial was set to begin in October 2010, the parties participated in a day-long mediation session. The parties agreed to resolve their dispute and signed a two-page document titled "Stipulation for Settlement" (Stipulation). The gist of the settlement was that the Jhan Defendants, with no admission of liability, would pay Mejia within 45 days the sum of $25,000 in return for a release of all claims, the terms of the agreement would be confidential, and Mejia would not reapply for work with, or otherwise seek referrals from, the Jhan Defendants in the future. Mejia, her counsel, defense counsel and both Jhan Defendants executed the Stipulation that day.

Paragraph 4(f) of the Stipulation provides: "Parties contemplate preparation of a long form settlement agreement by defense counsel and its delivery to plaintiff's counsel within the next 10 days." Defense counsel drafted a four-page, long-form agreement reiterating the terms set forth in the Stipulation and forwarded it to Mejia's counsel. Mejia and her counsel executed the long-form agreement and returned it to defense counsel on October 25, 2010.

Consistent with paragraph 4(h) of the Stipulation, Mejia also filed a Notice of Settlement with the court, indicating a dismissal of the action would be forthcoming. On November 30, 2010, defense counsel notified Mejia's counsel that the Jhan Defendants would not make payment under the settlement agreement because of an alleged breach of the confidentiality provision by Mejia. The Jhan Defendants refused to execute the long-form agreement and did not comply with the Stipulation.

Mejia filed a motion pursuant to section 664.6 to enforce the Stipulation and enter its terms as a judgment. 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." A section 664.6 motion "„is applicable not only to judicially supervised settlement conferences, but to stipulations of settlement in writing or orally before the court.' [Citation.]" (Fiore v. Alvord (1985) 182 Cal.App.3d 561, 565.)

After briefing and argument, the court granted Mejia's motion, citing Hines v. Lukes (2008) 167 Cal.App.4th 1174 (Hines), and explaining the court was authorized to enforce a binding settlement irrespective of whether there were allegations of breach or excuse for nonperformance. The Jhan Defendants contend on appeal the trial court erred in granting Mejia's motion and entering judgment. They argue the Stipulation fails to meet the requirements of section 664.6, in that it is not a writing signed by the parties that reflects all material terms to which the parties mutually assented. More specifically, they contend the confidentiality provision in the Stipulation is fatally uncertain. They further argue Mejia made material misrepresentations to induce the formation and execution of the agreement such that there was never any meeting of the minds and therefore no contract formation. And, they contend that even if the Stipulation was enforceable, the court should nonetheless have refused to enforce it because Mejia failed to refute the opposition evidence showing she had materially breached the confidentiality provision, thereby excusing any performance by the Jhan Defendants. None of the arguments is persuasive.

The Jhan Defendants appealed prematurely from the order granting the motion instead of the later-filed judgment entered February 14, 2011. We have jurisdiction to resolve the appeal pursuant to California Rules of Court, rule 8.104, subdivision (d).

"Factual determinations made by a trial court on a section 664.6 motion to enforce a settlement must be affirmed if the trial court's factual findings are supported by substantial evidence." (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 815 (Weddington); see also In re Marriage of Assemi (1994) 7 Cal.4th 896, 911.) Moreover, "[a]n appealed judgment is presumed correct, and the appellant must affirmatively show error." (Hines, supra, 167 Cal.App.4th at p. 1183.)

The Stipulation satisfies the statutory prerequisites of section 664.6. It is a written agreement duly executed by all parties. Moreover, paragraph 6 of the Stipulation expressly provides that "[t]his mediation settlement agreement is intended to be binding and enforceable and is effective this 13th day of Oct., 2010, and reflects the final agreement between the parties to this dispute, and each of them, pursuant to Evidence Code Section 1123. This stipulation for settlement is admissible and subject to disclosure, despite the otherwise enforceable requirements of confidentiality, solely for the purpose of establishing in court that an agreement has been reached by the parties for purposes of enforcing and interpreting that agreement."

Paragraph 4(f) of the Stipulation, which states the parties contemplated drafting a long-form agreement with more formality, does not detract from the enforceability of the Stipulation as a binding settlement agreement. "'"Whether a writing constitutes a final agreement or merely an agreement to make an agreement depends primarily upon the intention of the parties. In the absence of ambiguity this must be determined by a construction of the instrument taken as a whole."' [Citation.] 'The objective intent as evidenced by the words of the instrument, not the parties' subjective intent, governs our interpretation.' [Citation.] [¶] Where the writing at issue shows 'no more than an intent to further reduce the informal writing to a more formal one' the failure to follow it with a more formal writing does not negate the existence of the prior contract. [Citation.]" (Harris v. Rudin, Richman & Appel (1999) 74 Cal.App.4th 299, 307, italics added; see also 1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, § 133, p. 172.)

There is nothing ambiguous about paragraph 6 of the Stipulation. By its plain and unequivocal language it establishes that the parties intended the Stipulation to be a true reflection of their final agreement and binding on them, irrespective of a desire to prepare a more formal version of the Stipulation. Paragraph 5 provides the Stipulation may be enforced by a section 664.6 motion and that the parties intended the court to retain jurisdiction to enforce the terms of the Stipulation under section 664.6. The Jhan Defendants cannot avoid the binding settlement they entered into simply by having refused to execute the long-form agreement that conformed to the terms of the executed Stipulation. (See Elyaoudayan v. Hoffman (2003) 104 Cal.App.4th 1421, 1431 [party who orally agreed to material terms of settlement could not "escape" his obligations by refusing to sign written agreement that conformed to oral terms].)

Moreover, the Stipulation is also sufficiently certain as to the material terms to allow enforcement. "A settlement agreement is a contract, and the legal principles which apply to contracts generally apply to settlement contracts." (Weddington, supra, 60 Cal.App.4th at p. 810.) The Jhan Defendants argue the Stipulation contains only the word "confidentiality" listed as an additional provision in paragraph 4, which is too indefinite to allow for enforcement and reveals there was no meeting of the minds as to the nature and scope of the confidentiality provision. We reject that argument. Plainly, the parties intended to keep the terms of their settlement agreement confidential unless disclosure of its terms became necessary to enforce the agreement. Such confidentiality provisions are common, and the brief reference to confidentiality is sufficient to support mutuality of consent as to the material terms within the meaning of Civil Code, section 1580, which provides that "[c]onsent is not mutual, unless the parties all agree upon the same thing in the same sense."

"'The existence of mutual consent is determined by objective rather than subjective criteria, the test being what the outward manifestations of consent would lead a reasonable person to believe.' [Citation.]" (Weddington, supra, 60 Cal.App.4th at p. 811.) The long-form agreement, drafted by defense counsel, and presented to the court below in both the moving and opposition papers, is undisputed evidence the agreed-upon confidentiality provision was intended to be nothing more than a standard provision that the settlement terms would be kept confidential. The confidentiality provision in the long-form written agreement differs from the Stipulation only because of the inclusion of standard form language, but there are no additional material terms not reflected in the Stipulation. It reasonably can be inferred from such evidence that had the parties discussed and agreed upon additional terms for the confidentiality provision, defense counsel would have included them in the long-form agreement. The Stipulation, with the one-word confidentiality provision, was therefore properly enforced by the court. (See, e.g., Estate of Thottam (2008) 165 Cal.App.4th 1331, 1340 [shorthand titles for assets listed on chart in settlement agreement for division of assets lacked formality but were "sufficiently clear to determine the obligations to which the parties agreed"].)

The confidentiality provision is not incapable of enforcement. "'"The terms of a contract are reasonably certain if they provide a basis for determining the existence of a breach and for giving an appropriate remedy."' [Citation.]" (Weddington, supra, 60 Cal.App.4th at p. 811.) Reading the Stipulation as a whole and giving the language used its ordinary and reasonable meaning, the Stipulation fairly reflects that the parties intended to fully and finally resolve their dispute by way of one payment of $25,000 by the Jhan Defendants to Mejia, in return for a release of all claims, plus an agreement to keep the terms of the settlement confidential and that Mejia would not reapply or seek any further referrals or work from the Jhan Defendants in the future. In the event of an alleged breach by Mejia, the Jhan Defendants would have ordinary contract remedies available to them in any action for breach of the settlement agreement. Their argument there is no basis for determining what remedies are available to them is without merit.

The Jhan Defendants argue the trial court failed to make the required threshold determination as to whether or not the parties ever formed a contract, including a sufficiently definite confidentiality provision. They argue the court erroneously reserved a ruling on that key issue for any subsequent suit for alleged breach of the settlement agreement. We disagree. The court found the Stipulation was enforceable based on the evidence before it in both the moving and opposing papers and therefore granted the motion. The court observed that the only factual dispute was whether Mejia had breached the confidentiality provision by disclosing the settlement to a third party. The court then correctly found it had authority, under Hines, to enforce the binding settlement, irrespective of defendants' claims of breach or excuse for nonperformance. (See Hines, supra, 167 Cal.App.4th at p. 1185.) A court ruling on a section 664.6 motion has no obligation to recite any formulaic words or phrases in rendering its ruling.

Claims of breach or excuses for nonperformance do not require the trial court to refuse to enforce an otherwise binding settlement. (Hines, supra, 167 Cal.App.4th at p. 1185; see also Viejo Bancorp, Inc. v. Wood (1989) 217 Cal.App.3d 200, 209, fn. 4 ["Judgment may be entered under section 664.6 whether the parties are complying with the terms of the agreement or whether they are not"].) To the extent the Jhan Defendants suggest that Mejia's obligations under the settlement were conditions precedent to their performance such that enforcement should never have been ordered in the first instance, the record does not support that claim.

The Jhan Defendants also contend the court erred because the Stipulation was induced by fraud thereby vitiating their consent to settle at the mediation and preventing any finding of contract formation. They assert they learned in October 2010 that Mejia had falsely stated her immigration status on an official document, a fact she apparently denied at her deposition. In argument before this court, they contend this fact was crucial to Mejia's credibility and that they would have proceeded to trial and not settled on any basis had Mejia testified honestly at her deposition. The Jhan Defendants presented no evidence to the trial court that they would not have entered into the settlement at the October 6 mediation if they had known Mejia had purportedly testified falsely at her deposition about signing the immigration document. Their argument on appeal rests on the declaration of Janice Bautista, which contains no statement that the settlement would not have been reached if the Jhan Defendants had known of Mejia's alleged fraud. We find no merit to the Jhan Defendants' purported fraud defense to contract formation.

The record contains substantial evidence in support of the court's order granting Mejia's section 664.6 motion to enforce the Stipulation and entering judgment. The Jhan Defendants have failed to affirmatively show error or any basis for reversing the court's enforcement of the parties' voluntary pretrial resolution of their dispute. (Casa de Valley View Owner's Assn. v. Stevenson (1985) 167 Cal.App.3d 1182, 1190 ["public policy of this state supports pretrial settlement of lawsuits and enforcement of judicially supervised settlements"]; accord, Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1359 ["strong public policy of this state [is] to encourage the voluntary settlement of litigation"].)

DISPOSITION

The judgment is affirmed. Respondent Mejia shall recover her costs on appeal.

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

J. GRIMES WE CONCUR:

RUBIN, Acting P. J.

FLIER, J.


Summaries of

Mejia v. Jhan, Inc.

COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION EIGHT
Jan 10, 2012
B230818 (Cal. Ct. App. Jan. 10, 2012)
Case details for

Mejia v. Jhan, Inc.

Case Details

Full title:GILDA C. MEJIA, Plaintiff and Respondent, v. JHAN, INC., et al.…

Court:COURT OF APPEAL OF THE STATE OF CALIFORNIA SECOND APPELLATE DISTRICT DIVISION EIGHT

Date published: Jan 10, 2012

Citations

B230818 (Cal. Ct. App. Jan. 10, 2012)