Opinion
E065943
03-19-2018
G&O CHINO PROPERTY PARTNERSHIP, Plaintiff and Respondent, v. PISSAMAI PATAMAKANTHIN, Individually and as Successor in Interest, etc., et al., Defendants and Appellants.
Keith A. Fink & Associates, Keith A. Fink and Olaf J. Muller for Defendants and Appellants. King Parret & Droste and Charles W. Parret for Plaintiff and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Super.Ct.No. CIVRS909672) OPINION APPEAL from the Superior Court of San Bernardino County. Wilfred J. Schneider, Jr., Judge. Dismissed. Keith A. Fink & Associates, Keith A. Fink and Olaf J. Muller for Defendants and Appellants. King Parret & Droste and Charles W. Parret for Plaintiff and Respondent.
INTRODUCTION
This case involves a settlement agreement entered into in 2010 by defendants and appellants Chic Home Trends, Inc., and Pissamai Patamakanthin, as well as Pissamai's late husband, Sommai Patamakanthin, to settle a lawsuit filed by plaintiff and respondent G&O Chino Property Partnership (plaintiff or G&O).
Sommai passed away in 2015, and his widow, Pissamai, is his successor in interest with respect to the litigation. She is also a party to the settlement agreement, although not to the underlying lawsuit. For convenience, references to "the defendants" include Pissamai. Also for convenience, we will sometimes refer to the Patamakanthins by their first names. We mean no disrespect.
In 2016, G&O filed a motion to enforce the settlement agreement, pursuant to Code of Civil Procedure section 664.6, or for orders for execution of a stipulated judgment that was entered against Chic Home Trends as part of the settlement agreement. The court issued an order assigning certain funds, held in the trust account of defendants' attorneys, to plaintiff. In their opening brief, defendants contended that rather than enforcing the settlement agreement, the trial court's order rewrote the agreement, to their detriment. In their reply brief, they acknowledge that the order did not enforce the settlement agreement, but instead assigned to G&O all of the money recovered by them in an unrelated lawsuit, pursuant to section 708.510, up to the amount of the stipulated judgment against Chic Home Trends. They contend that the terms of the settlement agreement precluded the trial court from issuing the order allowing G&O to levy on the judgment and assigning 100 percent of the proceeds of that judgment. The settlement agreement provided that they would pay G&O only 50 percent of all money recovered on the judgment in the other case, up to the amount of the stipulated judgment and that G&O would not levy on the stipulated judgment unless defendants defaulted on their payment obligations pursuant to the settlement agreement. Defendants contended that they did not default on their payment obligations. We do not reach these contentions because we conclude that the order appealed from is not appealable, and that this court therefore does not have jurisdiction. Accordingly, we will dismiss the appeal.
All further statutory citations refer to the Code of Civil Procedure unless another code is specified.
FACTUAL AND PROCEDURAL HISTORY
In 2009, G&O filed suit in the San Bernardino County Superior Court alleging that Trend Setting Designs, Inc., the predecessor of Chic Home Trends, Inc., had breached a lease agreement for premises owned by G&O. The complaint also alleged that Sommai Patamakanthin "received fraudulent transfers" from Trend Setting Designs, Inc., and was therefore liable for that company's debts as alleged in the complaint. Trend Setting Designs filed a lawsuit in the Orange County Superior Court (Orange County Super. Ct. case No. 30-2009-0031356) against Sommai Patamakanthin, his wife, Pissamai Patamakanthin, and several other individuals. Sommai filed a cross-complaint in the Orange County action against Trend Setting Designs and its owner, David Gianulias. During the pendency of the litigation, Trend Setting Designs, Inc., changed its name to Chic Home Trends, Inc., and G&O amended its complaint in the San Bernardino action to include it as a defendant by that name.
In June 2010, the Patamakanthins and Trend Setting Designs/Chic Home Trends entered into a settlement agreement with G&O with respect to the San Bernardino action. As part of the settlement, a stipulated judgment for $360,000 was entered against Trend Setting Designs/Chic Home Trends. The agreement provided that G&O would not levy on the judgment unless the defendants failed to make timely payments as agreed. The settlement agreement provided that Sommai would pay G&O $72,000 in 36 monthly installments. If full payment was timely made, G&O would credit Sommai with $100,000 in full satisfaction of the claims against him in the San Bernardino action and would credit $100,000 toward satisfaction of the stipulated judgment against Trend Setting Designs/Chic Home Trends. Although Sommai was also required to execute a stipulated judgment, the agreement provided that it would not be entered unless he failed to make the installment payments on time. Trend Setting Designs/Chic Home Trends and Sommai agreed to "take all reasonable steps" toward pursuing their cross-complaint in the Orange County action, and agreed to pay G&O 50 percent of the money or other consideration that was collected in settlement of that suit or in enforcement of any judgment entered in that suit, up to the amount of the stipulated judgment in the San Bernardino action, plus accrued interest. G&O's share of the proceeds from the Orange County action were to be paid to G&O within 10 days of receipt by defendants.
Although the register of actions reflects that judgment was entered on September 2, 2010, the record on appeal does not contain a document entitled "judgment." It contains only the stipulation for entry of judgment executed by G&O and Trend Setting Designs, G&O's request for entry of the stipulated judgment, and the trial court's order stating that "the stipulation for judgment shall be filed and judgment entered against" Trend Setting Design/Chic Home Trends. We have been informed by the clerk of the superior court that the stipulated judgment does constitute the judgment.
G&O acknowledged that Sommai made full payment of the $72,000 in a timely manner and credited defendants with payment of $100,000 toward settlement of the San Bernardino action. The action was dismissed as to Sommai, with prejudice, on November 15, 2013.
In January 2011, Trend Setting Designs/Chic Home Trends and the Patamakanthins retained the law firm of Baute & Tidus, LLP (Baute) to represent them in the Orange County action. The retainer agreement granted Baute a lien to secure payment of fees and costs. On December 22, 2011, G&O filed a notice of judgment creditor's lien in the Orange County action.
In March 2012, Trend Setting Designs/Chic Home Trends and the Patamakanthins obtained a judgment for nearly $3 million in the Orange County action. Baute collected approximately $300,000 of the judgment over a period of about a year. In June 2013, Trend Setting Designs/Chic Home Trends and the Patamakanthins retained new counsel, Fink and Steinberg (Fink), to represent them in the Orange County action. That firm collected an additional $5,000 of the judgment. Both Baute and Fink retained the funds they had collected in their respective client trust accounts, claiming that some or all of the funds belonged to them as earned fees. A lawsuit was filed in Los Angeles County (Los Angeles County Super. Ct. case No. BC534990) to determine the amount of attorney fees owed to Baute. That suit remained pending on the date that the court in the San Bernardino action took G&O's motion to enforce the settlement agreement under submission.
Sommai died on or about March 1, 2015, and Pissamai acknowledged that she was his successor in interest with respect to the lawsuits.
On January 29, 2016, G&O filed a motion seeking to enforce the settlement agreement against both Trend Setting Designs/Chic Home Trends and Pissamai, or to obtain orders executing the stipulated judgment under numerous provisions of the Code of Civil Procedure, including section 708.510. The motion asserted that defendants had breached the settlement agreement by failing to pay over to them 50 percent of the money collected by the two law firms within 10 days of defendants' receipt of the money. G&O contended that the funds belonged to defendants and were "constructively" in defendants' possession, even though G&O conceded that defendants had no control over the funds as long as the attorneys retained the funds in their client trust accounts. G&O asserted that the order was necessary to assign the funds to it "so it is clear to [defendants and the law firms] that the funds belong to G&O." Defendants opposed the motion on the ground that they did not breach the settlement agreement because they had not yet received the judgment proceeds, in that they had no access to the funds until they had resolved the dispute with the two law firms as to how much of the money was owed to the attorneys. They also asserted that the motion was premature because until the attorney fee dispute was resolved, it was impossible to determine how much of the money did actually belong to them and how much was owed to G&O.
Section 708.510 provides, in pertinent part: "(a) Except as otherwise provided by law, upon application of the judgment creditor on noticed motion, the court may order the judgment debtor to assign to the judgment creditor or to a receiver appointed pursuant to Article 7 (commencing with Section 708.610) all or part of a right to payment due or to become due, whether or not the right is conditioned on future developments . . . ."
The trial court partially granted the motion. The court's order makes no reference to enforcing the settlement agreement. Rather, it provides: (1) that all monies deposited in the trust account of the Baute law firm that were collected in enforcement of the Orange County judgment on behalf of Chic Home Trends and Sommai Patamakanthin that "are not allocated and applied to payment of [Baute's] attorney fees and costs . . . as determined" in the Los Angeles action "are assigned to and are the property of" G&O; and (2) that all monies thereafter collected as a result of the enforcement or payment of the Orange County judgment "are assigned to, and [are] the property of [G&O], until such time as the judgment entered in this action against Chic Home Trends, Inc., and in favor of [G&O] is paid in full." The order also awarded G&O attorney fees in the amount of $2,400 and costs in the amount of $60, payable by Chic Home Trends and by Pissamai Patamakanthin, both individually and as trustee of the Patamakanthin Revocable Living Trust.
The motion asserted that after Sommai's death, Pissamai had transferred their assets into a revocable trust.
Defendants filed a timely notice of appeal.
The notice of appeal was also filed on behalf of Rosalyn Patamakanthin and Shawn Patamakanthin, who are apparently the children of Sommai and Pissamai. They are not parties to the underlying lawsuit, but are apparently parties to the Orange County and Los Angeles actions. They contend that the order appealed from in this case violates their right to collect money owed to them in the Orange County action. We dismissed the appeal as to them by an order dated July 21, 2016.
LEGAL ANALYSIS
THE ASSIGNMENT ORDER IS NOT AN
APPEALABLE ORDER AFTER JUDGMENT
In their opening brief, defendants asserted that the order is appealable as an order after judgment pursuant to section 904.1, subdivision (a)(2). Plaintiffs did not challenge this assertion. We directed the parties to provide supplemental briefing on this issue. Having reviewed their submissions, we conclude that the order is not appealable.
"A reviewing court has jurisdiction over a direct appeal only when there is (1) an appealable order or (2) an appealable judgment." (Griset v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 696.) A trial court's order is appealable when it is made so by statute. (Ibid.) Section 904.1, subdivision (a)(2), provides that an appeal may be taken from "an order made after a judgment made appealable by" section 904.1, subdivision (a)(1). A judgment entered by the consent of the parties, such as the stipulated judgment in this case, is normally not appealable. (City of Gardena v. Rikuo Corp. (2011) 192 Cal.App.4th 595, 600 (Rikuo).) Accordingly, the order after judgment at issue in this case is not an appealable order after judgment within the meaning of section 904.1, subdivision (a)(2), unless some exception applies.
A few recognized exceptions to this rule do exist. For example, a consent judgment is appealable when consent to entry of judgment is given merely to facilitate an appeal following an adverse determination of a critical issue. (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 400.) That exception does not apply in this case. Here, the purpose the stipulated judgment was to settle the parties' dispute, not to obtain appellate review.
Another exception has been found where the parties stipulated to judgment, but the judgment expressly reserved jurisdiction for the trial court to effectuate the terms and conditions set forth in the stipulated judgment. (Water Replenishment Dist. of Southern California v. City of Cerritos (2012) 202 Cal.App.4th 1063, 1069-1070.) Here, the stipulated judgment does not contain any terms or conditions and it does not stipulate to continued jurisdiction by the trial court. On the contrary, defendants expressly stipulated to the entry of the judgment even though it did not contain the terms and conditions included in the settlement agreement. Similarly, where the stipulated judgment did not resolve all issues in the case but left open the amounts of attorney fees and other payments and expressly provided that the amounts would be decided by the trial court, the order for attorney fees was appealable. (Ruiz v. California State Automobile Assn. Inter-Insurance Bureau (2013) 222 Cal.App.4th 596, 606.)
The final exception applies to interlocutory orders that are collateral to the main issue in litigation: "When a court renders an interlocutory order collateral to the main issue, dispositive of the rights of the parties in relation to the collateral matter, and directing payment of money or performance of an act, direct appeal may be taken. [Citations.] This constitutes a necessary exception to the one final judgment rule. Such a determination is substantially the same as a final judgment in an independent proceeding. [Citations.]" (In re Marriage of Skelley (1976) 18 Cal.3d 365, 368.) To qualify as appealable under the collateral order doctrine, the interlocutory order must (1) be a final determination (2) of a collateral matter and (3) direct the payment of money or performance of an act. (Koshak v. Malek (2011) 200 Cal.App.4th 1540, 1545.) The judgment in this case is not interlocutory.
In their supplemental brief, defendants argue, somewhat bafflingly, that the assignment order is appealable because the parties did not stipulate to it. That fact, while true, is irrelevant in that the issue is the appealability of the stipulated judgment.
Defendants also assert that an order granting a motion to enforce a settlement agreement is appealable. However, the trial court did not grant the motion to enforce the settlement agreement. Rather, it granted alternative relief requested in the same motion, i.e., enforcement of the stipulated judgment. Indeed, the trial court could not have issued an order enforcing the settlement agreement because the sole means of enforcing a settlement agreement, as provided for by section 664.6, is to enter a judgment that incorporates the terms of the settlement agreement. Because the stipulated judgment had already been entered, the court had no authority to enter a different judgment, and it did not purport to do so.
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.
Finally, defendants assert that Rikuo, supra, 192 Cal.App.4th 595, is distinguishable. They assert that in Rikuo, the stipulated judgment was entered into during pending litigation between the parties and was consented to by all of the parties. They assert that the settlement agreement in this case was not entered during the current pending litigation, and that the judgment was not consented to by all parties to the current litigation. We are not aware of any parties to the current litigation who are not parties to the settlement agreement, and defendants do not explain this assertion. Moreover, the settlement agreement itself is not material to the current litigation, which solely involves execution of the stipulated judgment entered pursuant to the parties' settlement agreement.
Because the order in this case does not qualify as an order after an appealable judgment within the meaning of section 904.1, subdivision (a)(2), we have no authority to decide the appeal. Accordingly, the appeal must be dismissed.
DISPOSITION
The appeal is dismissed. The parties shall bear their own costs on appeal.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
McKINSTER
Acting P. J. We concur: CODRINGTON
J. SLOUGH
J.