Opinion
B323032
03-19-2024
XIUXIA LIN, Plaintiff, Cross-defendant and Respondent, v. JOSUE DE JESUS, Defendant, Cross-complainant and Appellant.
Law Office of Gilbert Saucedo and Gilbert Saucedo for Defendant, Cross-complainant and Appellant.
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County, No. 21STCV28979 Barbara A. Meiers, Judge. Affirmed.
Law Office of Gilbert Saucedo and Gilbert Saucedo for Defendant, Cross-complainant and Appellant.
No appearance for Plaintiff, Cross-defendant and Respondent.
FEUER, J.
Josue De Jesus appeals from a judgment entered after a court trial in favor of Xiuxia Lin, De Jesus's former landlord, on Lin's complaint and De Jesus's cross-complaint arising from the parties' dispute over their obligations under a stipulated judgment that resolved Lin's prior unlawful detainer action against De Jesus. Under the stipulated judgment, De Jesus agreed he and his family would vacate the rental unit by a specified date, and Lin would pay De Jesus's relocation costs by executing a promissory note in favor of De Jesus secured by a deed of trust on the rental property. The trial court found De Jesus breached the stipulated judgment by failing to timely vacate the premises. The court voided the promissory note and cancelled the deed of trust, awarding nothing to De Jesus on his cross-complaint.
On appeal, De Jesus contends the trial court did not have authority to "overturn" the stipulated judgment; the court abused its discretion in failing to apply the doctrine of substantial performance; and the order extinguishing Lin's obligation to pay relocation fees unjustly enriched Lin. We affirm.
FACTUAL AND PROCEDURAL BACKGROUND
A. The Lease, Unlawful Detainer Action, and Stipulated Judgment
On April 17, 2013 De Jesus, Adriana G. Avila (De Jesus's wife), and Salvador Sevilla entered into a lease agreement with the then-owner of two residential units on property located in the City of Los Angeles (City) for $1,500 per month. Sevilla and his family resided in the front unit, and De Jesus and his family occupied the rear unit. The property was subject to the City's rent stabilization ordinance. (L.A. Mun. Code, ch. XV, art. 1, § 151.00 et seq.) The lease agreement terminated on January 15, 2014.
We use the spelling of Avila's name in De Jesus and Avila's trial brief.
In January 2014 Lin acquired the property, and the De Jesus family and Sevilla remained as tenants on the property. However, on November 18, 2019 Lin filed an unlawful detainer action against De Jesus, Avila, and Sevilla alleging Lin served a three-day notice to pay rent or quit on the three tenants, who owed $6,000 in past-due rent. In his answer, De Jesus asserted as affirmative defenses that Lin breached the implied warranty of habitability; Lin failed to provide De Jesus credit for necessary repairs (which De Jesus deducted from the rent); and Lin was estopped from evicting the family because she violated the City's rent stabilization ordinance, including the requirement under Los Angeles Municipal Code section 151.09(G) that the landlord pay a relocation fee.
On February 6, 2020 Lin and De Jesus entered into an unlawful detainer stipulation and judgment (stipulated judgment). The stipulated judgment provided that De Jesus's "rights under lease or rental agreement are forfeited," and it awarded possession of the rental unit to Lin. The stipulated judgment further stated, "Judgment shall be entered: now and stay enforcement of judgment as follows: a writ of possession may be issued forthwith but no final lockout prior to 4/8/20." The parties stipulated that "DeJesus, his wife, Andriana G. Villa, and their two children will move out of the subject property by April 7, 2020. Plaintiff agrees to execute a deed of trust and promissory note for $17,000 in favor of Josue De Jesus bearing an annual interest rate of 10% all due and payable (interest and principal) by February 7, 2021, with no prepayment penalty. Defendant Josue De Jesus will leave property in broom clean condition."
The stipulated judgment misspelled Avila's last name.
On February 26, 2020 Lin signed a promissory note in which she agreed to pay De Jesus $17,000 "with interest at the rate of 10 percent per year from the date February 7, 2020 until the date it is paid in full." The promissory note provided that "[t]he entire amount of unpaid principal plus accrued interest shall become due and payable on February 7, 2021 in one balloon payment without prior notice."
On March 19, 2020 Lin signed a deed of trust and assignment of rents securing the promissory note. The deed of trust named Gilbert Saucedo, De Jesus's attorney, as trustee and De Jesus as the beneficiary. In the deed of trust, Lin irrevocably granted to the trustee in trust, with power of sale, the property together with the rents and profits "[f]or the purpose of securing payment of" the promissory note. (Boldface omitted.) The deed of trust was recorded on April 1, 2020.
B. Lin's Complaint
On August 5, 2021 Lin filed a complaint in this action against De Jesus and Avila. The first cause of action for breach of contract alleged De Jesus and Avila breached the stipulated judgment by refusing to surrender the property and forcing Lin to call the Los Angeles Police Department to forcibly evict them. Lin sought to recover in excess of $19,000 for damage the family had caused to the property.
The second cause of action for trespass to property alleged De Jesus and Avila were holdover tenants who remained in possession of the property without Lin's consent and, as alleged in the first cause of action, damaged the property.
The third cause of action for fraud alleged that at the time De Jesus entered into the stipulated judgment, he fraudulently misrepresented to Lin that he would surrender possession of the property in order to induce Lin to sign the promissory note secured by the deed of trust with the intent that he and his family would remain in the property and, once Lin failed to pay the $17,000 owed under the agreement, he would foreclose on the property. Lin further alleged De Jesus took advantage of Lin's immigrant status, lack of sophistication in business matters, and inability to read and understand the contents of the promissory note in English. Lin sought "an order from the [c]ourt declaring the promissory note and deed of trust void or in the alternative voidable." Similarly, the fourth cause of action alleged against De Jesus for cancellation of instrument sought a declaration that the deed of trust was void or an order cancelling the promissory note and deed of trust based on De Jesus's fraudulent conduct and breach of the stipulated judgment, as well as damages to the property.
C. De Jesus's Cross-complaint
On January 10, 2022 De Jesus filed a cross-complaint against Lin. De Jesus alleged that in mid-2015 Lin made major structural changes to the rental unit that deprived De Jesus of a kitchen, appliances, and rental space. De Jesus notified Lin in writing of his intent to withhold rent based on the rental unit's defective conditions, but on July 8, 2015 Lin filed an unlawful detainer action against De Jesus, Avila, and Sevilla based on their failure to pay rent. Following a court trial, the trial court entered judgment in favor of De Jesus, allowing him to remain in possession of the property. Lin still failed to make the necessary repairs. On November 18, 2019 Lin filed a second unlawful detainer action. The cross-complaint recounted the terms of the stipulated judgment and alleged Lin failed to pay on the promissory note by February 7, 2021, and on March 22 De Jesus's attorney sent a demand letter to Lin.
The judgment attached to the cross-complaint only references De Jesus, not Avila or Sevilla.
The first cause of action for breach of contract alleged De Jesus performed all conditions required under the promissory note but Lin failed to pay the $17,000 she owed despite De Jesus's demand for payment. In his second cause of action for foreclosure (Code Civ. Proc., § 725a), De Jesus alleged he was entitled to a "judgment and decree of foreclosure" against the property. De Jesus requested, among other relief, that the trial court declare the deed of trust to be valid and superior to other encumbrances on the property; the property be foreclosed on and sold to pay the judgment; De Jesus be allowed to purchase the property; and De Jesus to recover his attorneys' fees and costs.
There was no court reporter at the trial, which took place on July 15 and 18, 2022, for a total of five hours. De Jesus submitted a proposed settled statement on Judicial Council Form APP-014, in which he summarized the trial testimony and described the exhibits but also discussed purported trial court errors, the exhibits excluded by the court, and the court's findings. Lin did not file a response. The trial court struck De Jesus's settled statement, finding Form APP-014 "invites and even requires users to provide and include information that is never supposed to be in a 'settled statement.'" The court issued its own settled statement, relying on its "often virtually verbatim notes" that the court "integrated" into the testimony set forth in De Jesus's proposed settled statement. On appeal, De Jesus does not object to the court's rejection of his settled statement or the court's preparation of its own settled statement.
1. Lin's case
Lin represented herself at trial and spoke through a Mandarin interpreter. Lin explained in her opening statement that she was 70 years old. When she and her husband purchased the property, they hired Yaianghso Kevin Pei to manage it. Lin did not know anything about the rental property because her husband and Pei managed the property. Lin added that "'[f]or so many years I did not get the rent. My husband passed away, and I am alone.'"
Pei testified that he was hired by Lin's husband to manage the property in 2014. De Jesus was a tenant at the time Lin's husband purchased the property. Pei asked De Jesus to stop smoking in front of the property, and De Jesus responded by filing three complaints with the City. The inspector found a violation with respect to the third complaint, and Lin's husband agreed to fix the problems; the City approved the repairs. However, De Jesus continued to make complaints to the City, and Lin told Pei she wanted to pay De Jesus to move out.
De Jesus agreed to vacate the rental unit, but a few days before the move-out date, De Jesus told Pei that he and his family could not move out in time because they were unable to find another rental. Lin insisted De Jesus and his family move out. Pei went to the property on the move-out date (April 7, 2020), and he saw people were still inside the rental unit. A few days later Pei contacted the police to remove the tenants, but the police told Pei that he needed to get a court order to evict them. When Pei contacted Lin's attorney to tell him that Pei intended to file another unlawful detainer action, the attorney indicated there was a ban on evictions. On May 28, 2020 Pei saw there was still furniture in the rental unit. He put everything outside and placed a chain lock on the door. A man identifying himself as De Jesus's cousin approached Pei and said he was told he could live there. Pei responded, "'No. Call the police or sue me. It is a month after the move out date.'" Pei allowed the man to take some items from the unit. Pei testified the tenants created a large hole in the roof; damaged the floor, sewer line, and plumbing; and caused fire and smoke damage to the exterior walls of the rental unit. It took three months to repair the damage at a cost of $19,230.
We assume Pei was referring to a ban on evictions during the COVID-19 pandemic.
On cross-examination, Pei testified De Jesus did not move out until May 28, 2020. Each time Pei went to the property, there were people inside and the front door and gate were locked. On May 28 Pei noticed the door was open, and he went inside and threw everything out. Pei did not see De Jesus, but on multiple occasions he saw people in the yard.
2. De Jesus's case
a. Testimony from Lin's son
De Jesus called Lin's son, Tiexuan Zheng, as a witness in the defense case. Zheng testified he was present at the unlawful detainer trial in February 2020 to translate and provide advice to his parents. An interpreter and negotiator helped the parties with the settlement. Lin did not have money to pay the relocation fee, so she signed a promissory note. Lin received a draft promissory note and deed of trust on February 7, 2020; she signed the promissory note on February 26 and the deed of trust on March 26. On April 2, 2020 Saucedo emailed Zheng, stating, "We finally received the last document from you necessary to close this eviction matter. We received it earlier this week and we have received confirmation that it was recorded today. [¶] We have informed Mr. De Jesus of this latest development. [¶] However, since we just received your last document this week, Mr. De Jesus was not able to secure new housing by next week and will need more time to find new housing and relocate." Zheng responded, "Make sure he moves out by the date we agreed on. The paperwork shall not be the reason he can delay. We did our part before the deadline and he didn't do his. Regardless of the terms, he is collecting interest by living there for free. I don't agree and will file a new case in two weeks if he stays in the property. Meanwhile the rent will be deducted from his whole payment as well."
According to Zheng, his parents were present at the commencement of the February 2020 unlawful detainer trial, and Zheng assisted with the negotiation of the settlement. Lin's husband died in January 2021.
On July 12, 2021 Saucedo sent Zheng an email stating the promissory note was due in February 2021, and on March 22 Saucedo sent a 90-day demand for payment but Zheng had yet to respond. Saucedo wrote, "Therefore, we will begin foreclosure proceeding to collect on the Promissory Note next week." Zheng replied, "Unfortunately, there is a breach of contract last year and we thought your client might have informed you. Right after the date (4-8-2020, we agreed on 4-7-2020), we went there to collect the keys. There was someone still living there on that property. We have to call the police for help in this matter. After a month or so, we finally got the house back. Also, the property was severely damaged, we have spent over $20,000.00 for the restoration (all photos and invoices available)[.] Nevertheless, the keys were never found ever since. Tell me what kind of moving out without handing over the keys."
b. De Jesus's testimony
De Jesus testified he moved out of the rental unit on April 17, 2020. Before he moved out, he painted the unit and spackled the floor. Although the floor was "raising up," the unit was otherwise in good condition. There were no holes in the floor, and the water leaks in the unit were from a long time ago. De Jesus denied he had caused any damage to the unit.
De Jesus admitted he was supposed to move out April 7, 2020. He found another rental unit that was available on April 6, and he planned to obtain a loan using the promissory note because he did not have money to relocate. But by the time he received the promissory note, that rental property was no longer available. Lin did not provide a deed of trust until late March 2020, and it was not recorded until early April 2020. By then, De Jesus was not able to find another rental unit. On April 17 De Jesus moved to his cousin's house. On the day De Jesus moved out, he called Zheng to give him the keys. Zheng told him to put the keys under the front door mat, and Zheng would come by the next day to pick them up. De Jesus placed the keys under the door mat and left.
The trial court denied De Jesus's request for a statement of decision because the trial lasted less than eight hours. (Code Civ. Proc., § 632 ["In superior courts, upon the trial of a question of fact by the court, written findings of fact and conclusions of law shall not be required. The court shall issue a statement of decision explaining the factual and legal basis for its decision as to each of the principal controverted issues at trial upon the request of any party appearing at the trial. The request must be made within 10 days after the court announces a tentative decision unless the trial is concluded within one calendar day or in less than eight hours over more than one day in which event the request must be made prior to the submission of the matter for decision."].) The court added that its "lengthy oral explanation of its rationale and findings in support of its judgment" was in effect an "'oral' statement of decision." De Jesus does not challenge the denial of his request for a statement of decision.
On July 18, 2022 the trial court entered judgment on the complaint and cross-complaint. The court held Lin was "to recover nothing from" De Jesus on her complaint. As to De Jesus's cross-claims for breach of contract and judicial foreclosure, the court found De Jesus breached the terms of the stipulated judgment and was "to recover nothing pursuant to his cross-complaint."
The judgment provided that Lin was entitled to declaratory relief, explaining, "[B]ecause [De Jesus] has sought relief in equity in the cross-complaint, including declaratory relief to the effect that the court find and declare that the 'Deed of Trust on which he relies be 'adjudged and decreed to be a valid and paramount lien on the subject property . . ., the court may declare and create whatever the proper relief is that is called for on the facts before the court[, and] this court now goes on to declare and render that relief that it has found to be appropriate on the facts before the court." The trial court found that because the stipulated judgment required Lin to issue a promissory note for $17,000 to be secured by a deed of trust against the property "in consideration of Mr. De Jesus's timely performance under the above-noted Stipulation/Judgment, but Mr. De Jesus breached that agreement by failing to perform as required," the "'premature' delivery of a promissory note and a Deed of Trust as against this property from [Lin] pursuant to that document is now to be vacated and set aside with the Deed of Trust cancelled and with no lien remaining on the property . . . ." Further, "any performance due on [Lin's] part, having been eliminated when the defendant Mr. De Jesus failed to timely perform on his part, thereby violat[ed] and breach[ed] the Stipulation and Judgment." The court ordered De Jesus to surrender the original promissory note within 15 days to the court clerk, and the court cancelled and voided the deed of trust.
De Jesus timely appealed.
DISCUSSION
A. The Trial Court Did Not "Overturn" the Stipulated Judgment
"A stipulated or consent judgment is 'a judgment entered by a court under the authority of, and in accordance with, the contractual agreement of the parties [citation], intended to settle their dispute fully and finally.'" (City of Gardena v. Rikuo Corp. (2011) 192 Cal.App.4th 595, 600, quoting Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 400; see Cal. Rules of Court, rule 5.411(b) ["A stipulated judgment constitutes a written agreement between the parties as to all matters covered by the stipulation."].) In interpreting a stipulated judgment, "we use ordinary contract principles and, in the absence of extrinsic evidence, we may interpret it as a matter of law." (Needelman v. DeWolf Realty Co., Inc. (2015) 239 Cal.App.4th 750, 758; accord, Sargon Enterprises, Inc. v. University of Southern California (2013) 215 Cal.App.4th 1495, 1508; see Pardee Construction Co. v. City of Camarillo (1984) 37 Cal.3d 465, 471 ["[A] consent judgment is in the nature of a contract [citation], subject to interpretation and construction."].)
De Jesus contends the trial court erred in declaring the stipulated judgment void, and the court had no authority to "overturn" the stipulated judgment. Further, he argues, pursuant to the stipulated judgment, Lin's only remedy for De Jesus's failure to move out by April 7, 2020 was to obtain a writ of possession to lock out De Jesus and his family. Neither contention has merit.
The unlawful detainer court did not retain jurisdiction to enforce the stipulated judgment under Code of Civil Procedure section 664.6. Accordingly, Lin properly brought causes of action for breach of contract and cancellation of instrument in this action to enforce the terms of the stipulated judgment. The trial court had authority to enforce the judgment, including making determinations as to breach and failure to perform. And the trial court did not "void" or "overrule" the stipulated judgment, instead finding that De Jesus had breached the settlement terms in the judgment. Moreover, contrary to De Jesus's assertion, nothing in the stipulated judgment limited Lin's remedy to a writ of possession for breach of the stipulated judgment. Rather, the court found Lin was not required to pay $17,000 in relocation expenses under the stipulated judgment to De Jesus in light of De Jesus's failure to comply with his obligation in the stipulated judgment to move out by April 7, 2020.
Code of Civil Procedure section 664.6, subdivision (a), provides, "If parties to pending litigation stipulate, in a writing signed by the parties outside of 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."
De Jesus also argues that Code of Civil Procedure section 664.6 does not apply, and therefore, cancellation of the stipulated judgment by a judge who did not enter the judgment was in error. De Jesus is correct that section 664.6 did not support a finding the stipulated judgment was void, but as discussed, that is not what the trial court did.
B. The Evidence at Trial Does Not Compel a Finding That De Jesus Substantially Performed Under the Stipulated Judgment
De Jesus contends the trial court erred in voiding the promissory note and deed of trust (instead of declaring them valid and finding Lin breached the stipulated judgment) based on his failure to perform because he substantially performed by moving out of the rental unit only 10 days late. De Jesus has not met his burden on appeal.
"'[S]ubstantial performance is sufficient, and justifies an action on the contract, although the other party is entitled to a reduction in the amount called for by the contract, to compensate for the defects. What constitutes substantial performance is a question of fact, but it is essential that there be no wilful departure from the terms of the contract, and that the defects be such as may be easily remedied or compensated, so that the promisee may get practically what the contract calls for.'" (Posner v. Grunwald-Marx, Inc. (1961) 56 Cal.2d 169, 186-187, italics omitted; accord, Magic Carpet Ride LLC v. Rugger Investment Group, L.L.C. (2019) 41 Cal.App.5th 357, 364.)
"The doctrine of substantial performance also applies when a party performs but misses a deadline. '[W]here time is not of the essence of a contract, payment made within a reasonable time after the due date stated in the contract constitutes compliance therewith.'" (Magic Carpet Ride LLC v. Rugger Investment Group, L.L.C., supra, 41 Cal.App.5th at p. 364; accord, Leiter v. Handelsman (1954) 125 Cal.App.2d 243, 251; see Civ. Code, § 1657 ["If no time is specified for the performance of an act required to be performed, a reasonable time is allowed."].)
For De Jesus to prevail on his cross-claim for breach of the stipulated judgment, he had to show (1) the existence of the contract; (2) his performance or excuse for nonperformance; (3) Lin's breach, and (4) the resulting damages to him. (Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821; Piedmont Capital Management, L.L.C. v. McElfish (2023) 94 Cal.App.5th 961, 968.) The trial court, in finding De Jesus did not timely perform under the stipulated judgment, impliedly ruled De Jesus did not prove his breach of contract cross-claim because he failed to meet his burden to prove the second element. (See Piedmont Capital Management, L.L.C., at p. 968 ["when a contract obligates a party to the contract to perform its contractual duties on a single, specified occasion," that party's "failure to perform on that occasion constitutes a breach of the whole contract"].)
"'In the case where the trier of fact has expressly or implicitly concluded that the party with the burden of proof did not carry the burden and that party appeals, it is misleading to characterize the failure-of-proof issue as whether substantial evidence supports the judgment.' [Citation.] '[W]here the issue on appeal turns on a failure of proof at trial, the question for a reviewing court becomes whether the evidence compels a finding in favor of the appellant as a matter of law.'" (Juen v. Alain Pinel Realtors, Inc. (2019) 32 Cal.App.5th 972, 978-979; accord, Almanor Lakeside Villas Owners Assn. v. Carson (2016) 246 Cal.App.4th 761, 769; Dreyer's Grand Ice Cream, Inc. v. County of Kern (2013) 218 Cal.App.4th 828, 838.)
"'Specifically, the question becomes whether the appellant's evidence was (1) "uncontradicted and unimpeached" and (2) "of such a character and weight as to leave no room for a judicial determination that it was insufficient to support a finding."'" (Juen v. Alain Pinel Realtors, Inc., supra, 32 Cal.App.5th at p. 979; accord, Glovis America, Inc. v. County of Ventura (2018) 28 Cal.App.5th 62, 71; Dreyer's Grand Ice Cream v. County of Kern, supra, 218 Cal.App.4th at p. 838.) "'[W]here . . . the judgment is against the party who has the burden of proof, it is almost impossible for him to prevail on appeal by arguing the evidence compels a judgment in his favor.'" (Atkins v. City of Los Angeles (2017) 8 Cal.App.5th 696, 734; accord, Bookout v. State of California ex rel. Dept. of Transportation (2010) 186 Cal.App.4th 1478, 1486.) "That is because unless the trial court makes specific findings of fact in favor of the losing [party], we presume the trial court found the [losing party's] evidence lacks sufficient weight and credibility to carry the burden of proof. [Citations.] We have no power on appeal to judge the credibility of witnesses or to reweigh the evidence." (Bookout, at p. 1486; accord, Jennifer K. v. Shane K. (2020) 47 Cal.App.5th 558, 579.)
De Jesus argued in his trial brief that his obligation to vacate the premises was contingent on Lin executing the promissory note and deed of trust, and he substantially performed by vacating the property within 10 days of the agreed-upon date once Lin complied with her obligations under the agreement. He further asserted that "[t]ime was of the essence in the performance of the agreement," and Lin's one-and-a-half-month delay in providing the signed and notarized deed of trust caused him to lose several rental opportunities.
At trial, there was conflicting evidence regarding when De Jesus and his family vacated the premises. De Jesus testified he moved out on April 17, 2020, but Pei testified the family vacated the unit on May 28, 2020, when Pei removed furniture from the rental unit and padlocked the front door. Because De Jesus admits that time was of the essence in performance of the stipulated judgment, the substantial performance doctrine does not apply. Even assuming the doctrine of substantial performance applies, the evidence at trial does not compel a finding that De Jeus substantially performed under the stipulated judgment in light of Pei's testimony that De Jesus and his family did not move out until May 28, 2020, more than a month after the April 7, 2020 move-out date.
De Jesus also contends the judgment is inequitable because it resulted in unjust enrichment for Lin who benefited unfairly by obtaining possession of the rental property without paying relocation benefits to De Jesus. De Jesus has forfeited his claim of error by failing to provide any legal authority in support of his unjust enrichment argument. (Conservatorship of Tedesco (2023) 91 Cal.App.5th 285, 302, fn. 20 ["Because [appellant] fails to support her arguments with citations to supporting authority, the arguments are forfeited."]; Sviridov v. City of San Diego (2017) 14 Cal.App.5th 514, 521 ["'"'When an appellant [asserts a point] but fails to support it with reasoned argument and citations to authority, we treat the point as [forfeited].'"'" (Footnote omitted.)].)
DISPOSITION
The judgment is affirmed. The parties are to bear their own costs on appeal.
We concur: SEGAL, Acting P. J., MARTINEZ, J.