Opinion
NOT TO BE PUBLISHED
APPEAL from orders of the Superior Court of San Diego County, No. 37-2008-00079697- CU-MC-CTL Ronald S. Prager, Judge.
O'ROURKE, J.
Appellants Andrew Wrobel and Magda Wrobel appeal from orders (1) denying their motion to set aside and/or clarify a June 29, 2009 settlement agreement; (2) denying their motion to correct a July 2, 2009 order to disburse interpleaded funds; and (3) approving and enforcing the June 29, 2009 settlement agreement under Code of Civil Procedure section 664.6. Appellants' former attorney and respondent, Deborah Raymond, had represented appellants in an action to avoid their home's foreclosure and filed an action to recover her attorney fees from the residence's expected sale proceeds. Following a lengthy settlement conference, appellants and Raymond placed a settlement agreement on the record, but appellants thereafter unsuccessfully moved to set aside or clarify the settlement agreement and Raymond obtained an order enforcing that agreement.
All statutory references are to the Code of Civil Procedure unless otherwise indicated.
On appeal, appellants contend the trial court's order enforcing the June 29, 2009 settlement agreement is "legally void" because they did not state on the record that they "agreed to be bound" by the agreement; the settlement agreement is vague and ambiguous on material points; and there was no meeting of the minds due to mistake. Appellants further contend the trial court abused its discretion in denying their motion to set aside the settlement and correct the court's July 2, 2009 order. We affirm the orders.
FACTUAL AND PROCEDURAL BACKGROUND
Raymond, an attorney, represented appellants in a federal court action alleging, among other things, violations of the federal Truth-In-Lending Act in connection with a loan secured by their personal residence. After withdrawing as their counsel in that case, Raymond filed suit against appellants and a title company alleging causes of action for breach of her contingent fee agreement for legal services, quantum meruit, account stated, intentional and negligent representation, and declaratory relief. She sought to recover $242,365.45 in attorney fees and costs by way of a lien and demand for payments from amounts held in escrow.
In September 2008, appellants, represented by the law firm Haney, Buchanan & Patterson, LLP, filed suit against Raymond for legal malpractice, breach of fiduciary duty, breach of contract, rescission, conversion and intentional interference with contractual relationship. Raymond successfully moved to strike the conversion and interference causes of action as based on protected petitioning activity, and thereafter obtained an award of attorney fees and costs in that action.
In May 2009, the court consolidated the two lawsuits and ordered the parties to mediation. Raymond moved for summary judgment or adjudication of the remaining causes of action in appellants' legal malpractice action. In June 2009, appellants dismissed the legal malpractice action with prejudice and the trial court set Raymond's action for a settlement conference on June 29, 2009.
On June 29, 2009, following an approximately five-hour settlement conference, the parties, with Raymond represented by attorney David Meagher and appellants represented by attorney Roger Popeney, placed an agreement on the record:
"Mr. Meagher:... [¶] The parties have agreed, your Honor, to resolve this case for payment of $190,000, currently held in the court's interpleader account, payment for Miss Raymond, remainder to the Wrobels. I will be preparing an order for Mr. Popeney's approval and submission to the court for the release of those funds. [¶] We will ask in our agreement and in our order that the Wrobels acknowledge the lien Miss Raymond had was valid. We will waive―We will ask for and receive an attorney's―waiver of attorney privilege, attorney-client privilege, as it relates to the Wrobels with the representation of the Haney law firm and all of its members and with Mr. Popeney. [¶] We will be returning all financial records that have been produced by the Wrobels in their debtor, Mr. Wrobel debtor's [sic] examination. We will be asking for and getting full cooperation in the malicious prosecution action against the Haneys [sic] that Miss Raymond is contemplating. [¶] There will be a mutual release then for all papers with a 1542 waiver, your Honor.
"The Court: This also satisfies the outstanding lien in the SLAPP suit? The judgment, this is in full satisfaction of the judgment in the
"Mr. Meagher: This will be full satisfaction of the claims against the Wrobels and mutual releases, and my client has asked me to inquire of the Court is there a mechanism by which there's an expedited release of those funds once the order is handed over to the Court for its autograph.
"The Court: We're going to find out. As soon as you draft the order, Mr. Popeney approves it as to form, come in, I'll sign it right away, and I think the clerk was inquiring about how to expedite.
[¶]... [¶]
"Mr. Meagher: Your Honor, I want to correct the record, just the waiver to attorney-client privilege as to Mr. Popeney relates to the malpractice claim, which has now been dismissed prior to this matter, won't apply to the specifics of this case, his defense. And there will be―I will be preparing settlement agreement [sic] for Mr. Popeney's review as well.
"The Court: Okay.
"Mr. Popeney: The other condition, your Honor, is that the Plaintiff and her attorney will return, within 10 days of execution of the order of the court, the financial records produced during the two sessions of the debtor's exam.
"Mr. Meagher: I think I mentioned that without 10 days, but absolutely.
"The Court: Would each of you, beginning with Mr. Meagher, inquire of your client, asking if your clients understand the terms of the settlement agreement, are willing to be bound by those terms.
"Mr. Meagher: Yes, your Honor.
"The Court: Have your client identify herself for the record.
"Ms. Raymond: Deborah Raymond, plaintiff.
"Mr. Meagher: Miss Raymond, you heard and the [sic]terms and conditions of the settlement proposal before the court and on the record. Do you understand that proposal?
"Ms. Raymond: Yes.
"Mr. Meagher: Do you accept and agree to be bound by the terms and conditions of the proposal?
"Ms. Raymond: Yes.
"Mr. Meagher: Do you have any reservations as to accepting that proposal?
"Ms. Raymond: No.
"The Court: Would you inquire of your clients, have them identify themselves and inquire, Mr. Popeney.
"Mrs. Wrobel: Magda Wrobel.
"Mr. Popeney: You understand the terms of the proposed settlement?
"Mrs. Wrobel: Yes.
"Mr. Popeney: You agree to the terms of the proposed settlement?
"Mrs. Wrobel: Yes.
"Mr. Popeney: Do you have any questions of myself or the court about any terms of the proposed settlement?
"Mrs. Wrobel: No.
"Mr. Popeney: Andrew, state your name.
"Mr. Wrobel: Andrew Wrobel.
"Mr. Popeney: Mr. Wrobel, do you understand the terms of the proposed settlement?
"Mr. Wrobel: Yes.
"Mr. Popeney: You agree to the terms of the proposed settlement?
"Mr. Wrobel: Yes.
"Mr. Popeney: Do you have any questions of myself or the Court concerning any terms of the proposed settlement?
"Mr. Wrobel: No.
"Mr. Popeney: Thank you.
"The Court: On behalf of the court, the settlement agreement is accepted. Based on everything I know about the case, I know that neither side is completely happy with the settlement terms, but I think a settlement that you agree to is always preferable to one that's imposed upon you by a jury, so much uncertainty anytime a jury is involved." After other brief comments, the court placed the matter on a 45-day dismissal track.
The following day, Raymond's and appellants' attorneys both signed an order to disburse the interpleaded funds, which order was entered on July 2, 2009. In part, the order states that "[t]he parties have resolved the dispute, and have determined that the Lien of Deborah L. Raymond, Esq. to be valid [sic]."
On July 13, 2009, a new attorney representing appellants filed a notice of limited scope representation to, in part, set aside the settlement that had been placed on the record, void the order to release interpleaded funds, and renew the settlement conference so as to arrive at a settlement "without misunderstandings." The next day, appellants filed an ex parte motion to set aside the settlement and to "restart" the settlement conference based on a "major misunderstanding" between appellants and their attorney and lack of "meeting of the minds" between the parties concerning the settlement terms. Andrew Wrobel submitted a sworn declaration in which he stated he understood that the representations he had made in open court were only to tell the court they had reached a "settlement in principal [sic]" subject to finalization in a written settlement agreement; that he was not told the legal significance of his statements at the hearing or that they could be enforced against them as a final judgment. He stated he did not agree to Raymond's counsel statement that he and his wife had agreed to admit to the validity of Raymond's lien or waive their attorney client privileges. According to Wrobel, they had never discussed those two points with attorney Popeney and when they attempted to ask him to explain why Raymond's counsel set out settlement points to which they had not agreed, Popeney told them they could discuss it later when counsel sent the proposed written settlement agreement. He stated that Popeney had signed the order releasing the interpleaded funds without first showing it to or discussing it with them, without their knowledge, and without their approval or authorization. Mrs. Wrobel submitted a virtually identical declaration.
Wrobel averred that at the settlement hearing when counsel mentioned the admission as to the lien's validity, he and his wife "screwed up our faces with disbelieve [sic] and disagreement and looked at our attorney with a questioning look and he 'shushed us' which we interpreted to mean 'we can talk after this hearing is over.' "
The set aside motion was also supported by a declaration from attorney Popeney, who averred in part, "When the settlement was read into the record at the hearing of 6-29-09, I believed that the Wrobels undertstood things as previously discussed; however, in talking with them later I have determined that they did not understand and comprehend the settlement terms in the same way I understood them." He claimed that the Wrobels had sent him an email telling him they did not agree to certain provisions of the draft written settlement agreement, but he had not seen their email when he signed the July 2, 2009 order in a "good faith belief that everybody had agreed to everything, and without first showing or checking with the Wrobels to see if they agreed...." Popeney's declaration did not state, and appellants do not argue on appeal, that the declaration was intended to request mandatory relief based on an attorney affidavit of fault under section 473, subdivision (b). But even if that was the intent, it does not compel mandatory relief. The mandatory provision of section 473, subdivision (b) deals only with applications for relief from a default, default judgment or dismissal entered through the fault of the defendant's attorney. (§ 473, subd. (b); Standard Microsystems Corp. v. Winbond Electronics Corp. (2009) 179 Cal.App.4th 868, 895; see also Jerry's Shell v. Equilon Enterprises, LLC (2005) 134 Cal.App.4th 1058, 1069-1072.) None of those situations are involved here.
Raymond objected to the ex parte hearing. She asserted appellants' claim of mistake was not supported by any competent evidence and the settlement hearing transcript reflected no dispute as to whether appellants had voluntarily entered into a binding agreement. She requested sanctions in the amount of additional attorney fees and costs incurred as a result of their tactics.
The trial court denied appellants' ex parte request. Raymond then moved to enter judgment and enforce the settlement agreement under section 664.6. She also sought to compel the production of documents that were subject to appellants' attorney-client privilege waiver. Appellants responded with a motion to set aside and/or clarify the settlement agreement, and also sought to correct the July 2, 2009 order to remove the language concerning the validity of Raymond's lien.
Rejecting appellants' claims, the trial court on September 25, 2009, granted Raymond's motion, and denied appellants' motions. It ruled, based on the transcript of the settlement conference, that appellants did not make a mistake as to the settlement terms concerning the validity of Raymond's attorney lien or their waiver of attorney-client privilege; that they both stated they understood the terms, agreed to be bound by them, and did not ask for clarification from counsel or the court. It ruled appellants did not make a competent showing that any clerical error occurred and that section 473 relief was not available to correct the July 2, 2009 order. Finally, it ruled appellants' belief that a written agreement was to be prepared did not vitiate the enforceability of the oral agreement entered into at the settlement conference.
Appellants filed the present appeal from the trial court's September 25, 2009 orders.
DISCUSSION
I. Legal Principles/Standard of Review
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...." This section grants authority to a trial court to enforce settlement agreements without the need to file a new lawsuit. (Timney v. Lin (2003) 106 Cal.App.4th 1121, 1125; Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 809.)
To be enforceable under section 664.6, a settlement agreement must either be entered into orally before a court or must be in writing and signed by the parties. (See In re Marriage of Assemi (1994) 7 Cal.4th 896, 905 (Assemi).) These alternative requirements are designed to "decrease the likelihood of misunderstandings.... Thus the statute requires the 'parties' to stipulate in writing or orally before the court that they have settled the case. The litigants' direct participation tends to ensure that the settlement is the result of their mature reflection and deliberate assent. This protects the parties against hasty and improvident settlement agreements by impressing upon them the seriousness and finality of the decision to settle, and minimizes the possibility of conflicting interpretations of the settlement. [Citations.] It also protects parties from impairment of their substantial rights without their knowledge and consent." (Levy v. Superior Court (1995) 10 Cal.4th 578, 585, fn. omitted.)
"It is for the trial court to determine in the first instance whether the parties have entered into an enforceable settlement. [Citation.] In making that determination, 'the trial court acts as the trier of fact, determining whether the parties entered into a valid and binding settlement. [Citation.] Trial judges may consider oral testimony or may determine the motion upon declarations alone. [Citation.] When the same judge hears the settlement and the motion to enter judgment on the settlement, he or she may consult his [or her] memory. [Citation.]' [Citation.] The trial court's factual findings on a motion to enforce a settlement pursuant to section 664.6 'are subject to limited appellate review and will not be disturbed if supported by substantial evidence.' " (Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1360.) "Consistent with the venerable substantial evidence standard of review, and with our policy favoring settlements, we resolve all evidentiary conflicts and draw all reasonable inferences to support the trial court's finding that these parties entered into an enforceable settlement agreement and its order enforcing that agreement." (Ibid.; see also Fiore v. Alvord (1985) 182 Cal.App.3d 561, 565.) We review the trial court's legal conclusions de novo. (Weddington Productions, Inc. v. Flick, supra, 60 Cal.App.4th at p. 815.)
II. Substantial Evidence Shows Appellants Entered Into a Binding Settlement Agreement
Relying on Assemi, supra, 7 Cal.4th 896 and comparing the circumstances of this case to those in Conservatorship of McElroy (2002) 104 Cal.App.4th 536, appellants contend the trial court's order enforcing the settlement agreement is "legally void" because neither the trial court nor their counsel asked them at the settlement hearing whether they "agreed to be bound" by the stated terms of the settlement. Appellants maintain that, under Assemi, the agree-to-be-bound language is "indispensable" to enforcement of an oral settlement agreement under section 664.6 and thus, because the settlement hearing transcript shows the parties did not use those words, the trial court's ruling enforcing the settlement is not supported by substantial evidence.
The contention is meritless, if not bordering on frivolous. In Assemi, the California Supreme Court considered whether the parties' oral stipulation to a settlement agreement before an appointed arbitrator, retired Judge Leonard Meyers, was enforceable as a settlement "before the court" under section 664.6. (Assemi, supra, 7 Cal.4th at p. 900.) There, as the high court recounted, the retired judge in transcribed proceedings stated "he was 'informed that the parties have arrived at a stipulation to dispose of all of the issues that were to be arbitrated.' After the parties' respective attorneys recited the terms of the settlement, Judge Meyers inquired of counsel whether they 'agree[d]' with the stipulation, and counsel for both parties replied affirmatively. When Judge Meyers then inquired of the parties individually whether they understood and agreed to the terms as recited on the record, both husband and wife replied affirmatively. Following further discussion relating to consummation of the settlement, Judge Meyers stated: 'Very well. And as the arbitrator, I accept the stipulation. I'm satisfied the parties understand it, accept the stipulation.' " (Id. at p. 902.)
For various reasons, our high court concluded the oral stipulation―though made to an arbitrator―was indeed "before the court" within the meaning of section 664.6. (Assemi, supra, 7 Cal.4th at pp. 906, 909.) The court further concluded that the trial court's determination that the parties had entered into a binding settlement agreement was "clearly" (id. at p. 911)supported by substantial evidence: "[T]he declarations filed in support of the motion and the transcript of the proceedings... establish that the parties, represented by counsel, engaged in settlement negotiations over an extended period of time, advised the retired judge of their desire to enter into a settlement disposing of all the matters that were to be arbitrated, explicitly defined and placed on the record the terms of the settlement, and, in response to Judge Meyers's inquiry, expressly stated they understood and agreed to those terms." (Id. at p. 911.) The wife had merely expressed her misgivings about having entered into the stipulation. (Id. at p. 912.) Accordingly, the court upheld the judgment enforcing the settlement agreement. (Ibid.)
Nothing in Assemi compels parties to use the formulaic words, "I agree to be bound" in order to enter into a binding oral settlement agreement on the record under section 664.6. Here, as in Assemi, the appellants "expressly stated they understood and agreed" (Assemi, supra, 7 Cal.4th at p. 911)to the stated settlement agreement's terms. These circumstances distinguish this case entirely from Conservatorship of McElroy, supra, 104 Cal.App.4th 536, in which the appellant's mere nod of her head, without more, was held not to constitute oral consent for purposes of enforcing a settlement under section 664.6. (Id. at p. 550.) In McElroy, unlike here, the superiorcourt judge did not individually question the parties concerning their understanding of the settlement terms, the parties did not expressly acknowledge their understanding of those terms, and the parties did not orally agree to be bound by those terms. (Id. at p. 550.) Contrary to appellants' arguments, both Assemi and McElroy compel us to conclude substantial evidence, namely, the hearing transcript reflecting counsel's questions and the parties' answers, supports the trial court's ruling in this case.
III. The Settlement Agreement is Sufficiently Definite
Appellants contend the settlement agreement is unenforceable and legally void because it is vague and ambiguous on material points. Relying in part on Elyaoudayan v. Hoffman (2003) 104 Cal.App.4th 1421 (Elyaoudayan), they specifically maintain that Raymond's counsel's statements, "I will be preparing [a] settlement agreement for Mr. Popeney's review as well, " and, "We will ask for and receive an attorney's―waiver of attorney client privilege...." are ambiguous and demonstrate that the parties intended that they would not be bound until they drew up and signed the written agreement. Appellants attack the attorney-client waiver term and other terms on vagueness grounds, including the trial court's order that they produce "records" without specifying exactly what records are required to be produced. They argue counsel's statement, "We will be asking for and getting full cooperation in the malicious prosecution action against the Haneys [sic] that Miss Raymond is contemplating, " is vague, ambiguous and undefined, and constitutes an unenforceable future agreement to agree.
The agreement placed on the record in this case does not reflect either an agreement to agree in the future, or an agreement that the oral stipulation would not be binding until execution of a formal written settlement contract. The transcript reveals that, as attorney Meagher put it, at the hearing, the parties unequivocally stated in present perfect tense that they "have agreed... to resolve this case...." Counsel stated the settlement agreement's terms, and the parties, all physically present, each expressed their agreement and understanding of those terms. Thus, the circumstances are akin to those in Elyaoudayan, supra, 104 Cal.App.4th 1421, in which counsel read a settlement agreement into the record providing for payment of a sum of money with another sum payable upon execution of a written settlement agreement, and still further payments afterwards. (Id. at p. 1425.) The appellant, who later sought to set aside the oral settlement agreement, thereafter was questioned and individually stated he understood and agreed to the terms. (Id. at pp. 1425-1427.)
In Elyaoudayan, the Court of Appeal rejected the appellant's argument that a settlement agreement orally placed into the record was not enforceable because it contemplated a subsequent written agreement, which he did not sign. (Elyaoudayan, supra, 104 Cal.App.4th at p. 1429.) The appellate court explained that "[t]he oral agreement's statement that the parties would later sign a written agreement did not affect the enforceability of the oral settlement under section 664.6. ' " ' Whether [an oral agreement] 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 [oral agreement] as a whole.' "... "The objective intent as evidenced by the words of the [oral agreement], not the parties' subjective intent, governs our interpretation.'... [¶] '[If] the [oral agreement] at issue shows "no more than an intent to further reduce the [oral agreement] to a more formal [written] one" the failure to follow it with a more formal writing does not negate the existence of the prior [oral] contract.... However, where the [oral agreement] shows it was not intended to be binding until a formal written contract is executed, there is no contract.' " (Elyaoudayan, at pp. 1429-1430; see also Banner Entertainment, Inc. v. Superior Court (1998) 62 Cal.App.4th 348, 358.)
Here, as in Elyaoudayan, "[t]he attorneys participated in reading the settlement into the record and in questioning the individual parties to ensure that each party agreed to it. There was nothing tentative about the effect of the terms." (Elyaoudayan, supra, 104 Cal.App.4th at p. 1430.) At the conclusion of the hearing, the trial court stated "the settlement agreement is accepted" without any interruption or objection from the parties. Nothing in the transcript indicates the parties were engaging in preliminary negotiations, or that they did not expect the agreement to be final until it was memorialized in writing; rather, the transcript reflects a mutual and present intent to enter into a settlement. We thus follow the Elyaoudayan court's reasoning: "Having orally agreed to settlement terms before the court, parties may not escape their obligations by refusing to sign a written agreement that conforms to the oral terms. The oral settlement, like any agreement 'imposes upon each party a duty of good faith and fair dealing in its performance and its enforcement.' " (Id. at p. 1431.)
Nor have appellants shown that the oral agreement's terms were so vague, ambiguous or uncertain as to render them, or the contract as a whole, unenforceable. A settlement agreement is a contract and thus we judge its validity under the same legal principles that apply to contracts generally. (Stewart v. Preston Pipeline, Inc. (2005) 134 Cal.App.4th 1565.) It is true that "[w]here a contract is so uncertain and indefinite that the intention of the parties in material particulars cannot be ascertained, the contract is void and unenforceable." (Cal. Lettuce Growers v. Union Sugar Co. (1955) 45 Cal.2d 474, 481; Civ. Code, § 1598; see Amaral v. Cintas Corp. No. 2 (2008) 163 Cal.App.4th 1157, 1192.) But " 'the modern trend of the law favors carrying out the parties' intentions through the enforcement of contracts and disfavors holding them unenforceable because of uncertainty.' " (Amaral, at p. 1192, quoting Okun v. Morton (1988) 203 Cal.App.3d 805, 817; see also Magna Development Co. v. Reed (1964) 228 Cal.App.2d 230, 235-236.) " 'The law does not favor but leans against the destruction of contracts because of uncertainty; and it will, if feasible, so construe agreements as to carry into effect the reasonable intentions of the parties if that can be ascertained.' " (Cal. Lettuce Growers v. Union Sugar Co. at p. 481, see Amaral, at p. 1192.)
The question of ambiguity is one of law for this court to decide. (ASP Properties Group, L.P. v. Fard, Inc. (2005) 133 Cal.App.4th 1257, 1267; Winet v. Price (1992) 4 Cal.App.4th 1159, 1165.) We do not ascertain ambiguity in the term, as expressed by Raymond's counsel and agreed to by appellants, that "[w]e will ask for and receive an attorney's―waiver of attorney client privilege... as it relates to the Wrobels with the representation of the Haney law firm and all of its members and with Mr. Popeney." Counsel then corrected the record to state that "the waiver of attorney-client privilege as to Mr. Popeney relates to the malpractice claim, which has now been dismissed prior to this matter, won't apply to the specifics of this case, his defense." It is apparent from the parties' words that the agreement was that the Wrobels would waive their attorney-client privilege in connection with the Haney firm's representation of the Wrobels in their legal malpractice action against Raymond. In other words, we conclude the language is not reasonably susceptible to the interpretation proposed by appellants: that it was an agreement for an "attorney's-waiver [sic] of attorney client privilege." (Italics omitted.) We will not "strain to create an ambiguity where none exists." (ASP Properties Group, L.P. v. Fard, Inc., at p. 1269.)
This portion of the transcript reflects―and we will infer the trial court found―Raymond's counsel simply misspoke when he said, "an attorney's―waiver of attorney privilege, attorney-client privilege...." Counsel immediately corrected himself to make clear he was referring to a waiver of privilege by the Wrobels, and also made the parties' intentions even more clear when he further corrected the record a few moments later.
Nor can we say, based on our conclusions above and our reading of the reporter's transcript, that the Wrobels did not give an "intelligent, knowing and fully intentional waiver." The appellants rely upon their and attorney Popeney's declarations filed in support of their motion to set aside the settlement agreement. But as we have explained, mutual assent is determined under an objective standard applied to the outward manifestations or expressions of the parties, i.e., the reasonable meaning of their words and acts, and not their undisclosed or unexpressed intentions or understandings. (Bustamante v. Intuit, Inc. (2006) 141 Cal.App.4th 199, 208; ASP Properties Group v. Fard, Inc., supra, 133 Cal.App.4th at p. 1269; Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc. (2003) 109 Cal.App.4th 944, 956; see Shaw v. Regents of University of California (1997) 58 Cal.App.4th 44, 54-55 [the true intent of a contracting party is irrelevant if it remains unexpressed].) And contract interpretation is controlled by the parties' mutual intention at the time the contract is formed. (Civ. Code, § 1626.) Appellants' after-the-fact representations about their lack of consent and coercion―sentiments that were not disclosed during the oral settlement hearing―are irrelevant.
Finally, appellants have not demonstrated fatal uncertainty or ambiguity in the trial court's order concerning their production of records by October 2, 2009. As the transcript of the hearing on appellants' set aside motion reflects, this order was the result of the settlement term in which appellants agreed to give "full cooperation in the malicious prosecution action against the [Haney firm] that Miss Raymond is contemplating." Appellants assert the "full cooperation" term is vague, ambiguous and undefined because Raymond's malicious prosecution action was not on file at the time they entered into the oral settlement agreement. However, the transcript of the hearing reflects that Raymond's counsel specified the documents expected to be produced by appellants in a "formal written request...." Indeed, the trial court, recalling the settlement discussions, found "[t]he idea was they [Raymond and her counsel] were going after the Haney law firm in no uncertain terms and they were going to seek the support of the Wrobels in that and their cooperation. So whether that was testimony or documents, it's part of their cooperation."
Under the circumstances, and in view of the external facts of which the trial court was well aware, appellants have not met their burden to show fatal error or ambiguity in its document production order. "Neither law nor equity requires that every term and condition of an agreement be set forth in the contract. [Citations.] The usual and reasonable terms found in similar contracts can be looked to, unexpressed provisions of the contract may be inferred from the writing, external facts may be relied upon, and custom and usage may be resorted to in an effort to supply a deficiency if it does not alter or vary the terms of the agreement. [Citations.]' [Citations.] At bottom, '[i]f the parties have concluded a transaction in which it appears that they intend to make a contract, the court should not frustrate their intention if it is possible to reach a fair and just result, even though this requires a choice among conflicting meanings and the filling of some gaps that the parties have left.' " (Denver D. Darling, Inc. v. Controlled Environments Const., Inc. (2001) 89 Cal.App.4th 1221, 1237, quoting Larwin-Southern California, Inc. v. JGB Investment Co. (1979) 101 Cal.App.3d 626, 641.)
IV. Claim of Lack of Meeting of the Minds
Appellants contend there were insufficient grounds to enforce the June 29, 2009 settlement because as a result of their "mistaken understanding" there was no "meeting of the minds" between the parties as to the terms, conditions, meaning and implication of the settlement. They argue that they were not advised at the settlement hearing that its purpose was to put on the record the settlement, which would have future legal force of a binding contract that was enforceable as a judgment. To support this claim, appellants summarize portions of the sworn declarations they filed in support of their motion to set aside the settlement agreement and resume negotiations; they point out they had differing understandings from Raymond and their own counsel in that they did not agree to admit the validity of Raymond's attorney lien, they believed full cooperation did not require them to produce confidential files, and they did not understand the oral settlement was binding. Appellants maintain there was no contract formation because they did not agree on material terms of the contract.
These arguments are unavailing. Appellants merely reargue the merits of their set aside motion, rather than apply the appropriate appellate standard of review of the trial court's ruling in Raymond's favor. The trial court considering appellants' motions had also presided over the settlement conference, and took the parties' settlement stipulation on the record. It rejected appellants' declarations, which not only contradicted the court's own recollection of the settlement discussions and settlement hearing, but also the reporter's hearing transcript. "Where the existence of a contract is at issue and the evidence is conflicting or admits of more than one inference, it is for the trier of fact to determine whether the contract actually existed." (Bustamante v. Intuit, Inc., supra, 141 Cal.App.4th at p. 208.) The trial court here found the hearing transcript showed no mistake; that the parties agreed to be bound by the terms stated on the record, and did not ask for clarification from the court. On the disputed facts before it on appellants' motion, it was for the trial court to rule on contract formation and interpretation. (See Osumi v. Sutton, supra, 151 Cal.App.4th at pp. 1359-1360; Weddington Productions, Inc. v. Flick, supra, 60 Cal.App.4th at p. 810.) We will not disturb that ruling unless it is unsupported by substantial evidence. (Osumi, at p. 1360; Weddington, at p. 815.)In this case, the hearing transcript alone provides ample support for the trial court's rulings.
Moreover, although it is true as an abstract legal proposition that a "meeting of the minds" is essential to formation of a valid contract, it is equally true that the objective theory of contracts is the proper standard in California. We have already explained above that California recognizes the objective theory of contracts under which " '[i]t is the objective intent, as evidenced by the words of the contract, rather than the subjective intent of one of the parties, that controls interpretation.' [Citation.] The parties' undisclosed intent or understanding is irrelevant to contract interpretation." (Founding Members of the Newport Beach Country Club v. Newport Beach Country Club, Inc., supra, 109 Cal.App.4th at p. 956.) Thus, even if appellants actually believed they had agreed to something other than what the settlement agreement stated, or had misunderstood the legal consequences of the contract, such belief or misunderstanding is irrelevant because it was not disclosed at the time they placed the settlement on the record.
V. Set Aside Motion under Section 473
Appellants contend that their declarations in support of their set aside motion demonstrated a "serious misunderstanding" between them and their attorney concerning the settlement, justifying relief under sections 473 and 128, subdivision (a)(1). They correctly point out that a trial court ruling on a motion under section 473 is vested with broad discretion and its factual findings are entitled to deference. (Solv-All v. Superior Court (2005) 131 Cal.App.4th 1003, 1007-1008.) Appellants would have us find the circumstances here similar to the misunderstandings between attorney and client that they claim warranted relief in Robinson v. Hiles (1953) 10 Cal.App.2d 666 (Robinson) and Exley v. Exley (1951) 101 Cal.App.2d 831 (Exley).
These contentions, again, are unavailing. Robinson involved a motion to set aside a dismissal with prejudice that was entered by attorneys without the client's knowledge, authority or consent. (Robinson, supra, 119 Cal.App.2d at pp. 668-670.) In moving to set aside the dismissal, the client submitted a declaration stating unequivocally that she did not authorize her attorneys to dismiss, compromise or settle the action for any sum or at all; she did not sign any release of her claim; she did not authorize acceptance of any check or endorse any check in settlement of her claim, and her attorney signed a dismissal with prejudice. (Id. at p. 671.) On appeal from the trial court's order granting the motion to set aside the dismissal, the appellate court found no abuse of discretion. (Id. at pp. 673-674.) It relied on settled law establishing that mere employment of an attorney to represent a client in litigation does not carry with it the power to compromise that litigation, and also on the policy of the law to "bring about a trial on the merits wherever possible, so that any doubts which may exist should be resolved in favor of the application, to the end of securing to a litigant his day in court and a trial upon the merits." (Id. at pp. 672-673.)The circumstances in Robinson are not at all comparable to those here, where the trial court found, and the record shows, appellants were present and expressly agreed, without equivocation, to the terms and conditions of the settlement. Robinson does not convince us to disturb the trial court's broad discretion to deny appellants' motion in this case.
Exley is likewise inapposite. That case does not involve a set aside motion under Code of Civil Procedure section 473. Rather, faced with appellant's challenge to an order modifying custody of a minor child in a divorce proceeding (Exley, supra, 101 Cal.App.2d at pp. 835-836), the appellate court there merely observed that if father was misunderstood about the admission of a probation officer's report (which he apparently contended was false), he could have promptly made a motion for relief from the order if it was taken through mistake, inadvertence, surprise or excusable neglect. (Id. at p. 836.) The appellate court stated that no such steps were taken and thus father's contentions could not be sustained. (Ibid.) Exley does not provide any support for the proposition that relief under section 473 is available to set aside appellants' oral settlement entered into pursuant to section 664.6.
Appellants make no meaningful argument as to the applicability of section 128, subdivision (a)(1). Under settled appellate principles we presume the correctness of the trial court's order unless the appellant affirmatively demonstrates otherwise with reasoned argument and authority. (Denham v. Superior Court (1970) 2 Cal.3d 557, 564; Wint v. Fidelity & Casualty Co. (1973) 9 Cal.3d 257, 265; 9 Witkin, Cal. Procedure (4th ed. 1997) Appeal, § 594, p. 627.) Having no cognizable argument before us as to this statute, we do not address the point.
VI. Motion to Correct July 2, 2009 Order
Appellants contend the trial court abused its discretion in denying their motion to correct the July 2, 2009 order authorizing the release of the settlement funds in accordance with the division of money agreed to in the June 29, 2009 settlement. They characterize as a "clerical error" the language of the order pertaining to the parties having determined the validity of Raymond's lien. Appellants maintain the trial court abused its discretion by "ignoring" the case of Russell v. Superior Court of Placer County (1967) 252 Cal.App.2d 1, and other authorities cited in their briefs assertedly holding that an attorney's drafting error in a court document is considered clerical error for purposes of section 473, subdivision (d).
Appellants' arguments and case citations merely set out the general proposition that a correctable clerical mistake may be made by counsel. Appellants also repeat meritless arguments that they never agreed to the validity of Raymond's lien during the June 26, 2009 settlement conference because the hearing shows only that Raymond's counsel stated, "We will ask..., " which does not constitute an agreement. This is a mere reiteration of their assertion―addressed and rejected above―that the settlement was an unenforceable agreement to agree in the future.
Appellants also maintain their counsel "had no legal authorization from his clients to destroy [their] future right to make a State Bar Complaint about Ms. Raymond's tactics and methods used to enforce an invalid attorney lien by stipulated on [their] behalf that disputed [sic]attorney lien was now found to be 'valid' by Court Order." However, this assertion is belied by the settlement hearing transcript, and is also based on the flawed premise that counsel's statement at the settlement hearing―"We will ask in our agreement and in our order that the Wrobels acknowledge the lien Miss Raymond had was valid"―was not in fact an agreement.
The trial court's finding upon conflicting evidence as to whether a clerical error exists is conclusive on the reviewing court. (Denton v. Denton (1971) 18 Cal.App.3d 708, 715; see Nacht v. Nacht (1959) 167 Cal.App.2d 254, 262 [" 'Where there is conflicting evidence as to whether the error was clerical, the reviewing court will probably accept the conclusion of the trial court' "].) Appellants do not meaningfully explain how the order in this case resulted from true clerical error, other than to repeat the assertion that there was a misunderstanding between themselves and their counsel as reflected in declarations. But again, these declarations were discounted by the trial court, and appellants do not challenge (by engaging in a sufficiency of the evidence analysis) the trial court's factual finding that no clerical error was made. Indeed, they correctly acknowledge that "[a]n order made nunc pro tunc should correct clerical error by placing on the record what was actually decided by the court but was incorrectly recorded. It may not be used as a vehicle to review an order for legal or judicial error by 'correcting' the order in order to enter a new one." (Hamilton v. Laine (1997) 57 Cal.App.4th 885, 891, italics added; see also In re Marriage of Padgett (2009) 172 Cal.App.4th 830, 852 [citing Hamilton].) The latter is precisely what appellants asked the trial court to do: correct the July 2, 2009 order containing an express finding that the "parties have... determined that the Lien of Deborah L. Raymond, Esq., to be valid" and enter a new order eliminating that finding. Such an amendment would be a substantial difference from the original order, indicative of a non-clerical error. (See Nacht v. Nacht at p. 262.)
The trial court ruled below that appellants did not make a competent showing of clerical error. Appellants have not provided us with any cognizable ground to disturb that ruling.
DISPOSITION
The orders are affirmed. Raymond shall recover her costs on appeal.
WE CONCUR: NARES, Acting P. J., McDONALD, J.