Judge: Christian R. Gullon, Case: 24PSCV00189, Date: 2025-05-12 Tentative Ruling

Case Number: 24PSCV00189    Hearing Date: May 12, 2025    Dept: O

Tentative Ruling

PLAINTIFF’S MOTION TO ENFORCE SETTLEMENT is GRANTED IN PART; the court ENTERS judgment pursuant to the settlement agreement but the court DENIES the second form of relief to enforce that judgment because (i) the motion is procedurally defective and/or (ii) Defendant has not breached the 998 offer/settlement since time is not of the essence.

Background

This is a lemon law case.

On January 17, 2024, Plaintiff ERICK POBLETE filed suit against Defendant AMERICAN HONDA MOTOR CO, INC. alleging causes of action for: (1) violation of subdivision (d) of Civ. Code § 1793.2; (2) violation of subdivision (b) of Civ. Code § 1793.2; (3) violation of subdivision (a)(3) of Civ. Code § 1793.2; (4) breach of express written warranty; and (5) breach of the implied warranty of merchantability, arising from Plaintiff’s 2019 leasing of a 2020 Honda Civic.

On February 29, 2024, Defendant filed its answer.

On May 20, 2024, Plaintiff filed a Notice of Settlement of Entire Case.

On July 25, 2024, the Court held an OSC re: Dismissal (Settlement). The Court inquired as to the status of settlement. (7/25/24 Minute Order.) The parties indicated that settlement was pending return of the subject vehicle and requested to continue the matter, which the Court granted. (7/25/24 Minute Order.)

On October 22, 2024, Plaintiff filed the instant motion to enforce settlement. Plaintiff moves “in accordance with the provisions of C.C.P. § 664.6, for an Order and entry of Judgment enforcing the terms of a settlement agreement . . . which required Defendant . . . to perform the terms of the § 998 Offer to which it has not fulfilled.” (Not. of Mot. at p. ii:5-10.)

On October 25, 2024, the Court held an OSC re: Dismissal (Settlement). (10/25/24 Minute Order.) Counsel for Defendant represented to the Court that the settlement was pending receipt of payment. (10/25/24 Minute Order.) The Court discharged the OSC re: Dismissal (Settlement). (10/25/24 Minute Order.) The Court kept the hearing on the motion to enforce settlement on calendar. (10/25/24 Minute Order.)

On November 6, 2024, Defendant filed its opposition.

On November 13, 2024, Plaintiff filed his reply.

Legal Standard

Plaintiff brings forth the motion pursuant to Code of Civil Procedure section 664.6. Section 664.6 provides in relevant part that “the court, upon motion, may enter judgment pursuant to the terms of the settlement.” Under the statute, the court “retains jurisdiction over the parties to enforce the settlement until performance in full of the terms of the settlement.”

“Code of Civil Procedure section 664.6 provides a summary procedure to enforce a settlement agreement by entering judgment pursuant to the terms of the settlement.” (Hines v. Lukes (2008) 167 Cal.App.4th 1174, 1182.) “[I]f the parties to pending litigation enter into a settlement either in writing signed by the parties or orally before the court, the court, upon a motion, may enter judgment pursuant to the terms of the settlement.” (Ibid.) “The court retains jurisdiction to enforce a settlement under the statute even after a dismissal, but only if the parties requested such a retention of jurisdiction before the dismissal.” (Ibid.) “Such a request must be made either in writing signed by the parties or orally before the court.” (Ibid.)  

“A court ruling on a motion under Code of Civil Procedure section 664.6 must determine whether the parties entered into a valid and binding settlement.” (Ibid.) “A settlement is enforceable under section 664.6 only if the parties agreed to all material settlement terms.” (Ibid.) “The court ruling on the motion may consider the parties’ declarations and other evidence in deciding what terms the parties agreed to.” (Ibid.) “If the court determines that the parties entered into an enforceable settlement, it should grant the motion and enter a formal judgment pursuant to the terms of the settlement.” (Ibid.) Code Civ. Proc. § 664.6 “expressly provides for the court to enter judgment pursuant to the terms of the settlement.” (Id. at p. 1183.) “It is widely recognized that the courts are not at liberty to revise an agreement under the guise of construing it.” (Series AGI West Linn of Appian Group Investors DE, LLC v. Eves (2013) 217 Cal.App.4th 156, 164.)  

Discussion

At the outset, there is a fundamental problem with the motion that is not raised in the opposition. Because no judgment has yet been entered (hence Plaintiff’s request to enter judgment), Plaintiff has nothing to enforce pursuant to Section 664.6. It is the “judgment entered pursuant to [Section 998] [that] shall be deemed to be a compromise settlement." (Milicevich v. Sacramento Medical Center (1984) 155 Cal.App.3d 997, 1004.) With that, Plaintiff is essentially improperly seeking two forms of relief–entry of judgment and enforcement of judgment–in one motion. (See Rutter Group, California Practice Guide: Civil Procedure Before Trial ¶9:24.3 (2024) [practice for combining motions].)

In support of the motion, Plaintiff’s counsel, Benjamin Beck (“Beck”), provides a declaration. Mr. Beck declares, inter alia, that “Plaintiff signed the Settlement Agreement and Release (the ‘Settlement Agreement’) on March 20, 2024 and Defendant signed the Settlement Agreement May 10, 2024.” (Beck Decl., ¶ 3; Ex. 1.) The Settlement Agreement is “in redacted form to maintain the confidentiality of the financial terms of the settlement.” (Beck Decl., ¶ 3.) Mr. Beck further states that “Plaintiff[] provided to Defendant all of the required information to complete the vehicle return but Defendant has failed to schedule the vehicle return or otherwise direct Plaintiff when and where Plaintiff is to return the vehicle.” (Beck Decl., ¶ 4.) Plaintiff’s attempt to resolve the issue without motion practice was unsuccessful. (Beck Decl., ¶ 5; Ex. 2.)

The crux of the motion is that Defendant has failed to schedule the vehicle return or otherwise direct Plaintiff when and where Plaintiff is to return the vehicle. (Mot. at p. 1:18-19.) The relevant terms of the Settlement Agreement are as follows:

2. Claimant will surrender the Subject Vehicle, clean, in good condition, in good working order, without any damage and with all originally invoiced options and accessories intact, and free from any collision or other damage, any part removal, or any warranty non-conformities, exclusive of normal wear and tear and such alleged warranty non-conformities as are alleged to exist in the Action, to AHM or its designee at a location designated by AHM and mutually agreeable to Claimant, at a mutually convenient time and date to effectuate the repurchase. The Subject Vehicle shall be currently registered except as follows. If the Subject Vehicle’s registration has expired, Claimant may surrender the Subject Vehicle with a Department of Motor Vehicle Certificate of Planned Non-Operation. This Certificate shall have been executed before the Subject Vehicle’s last registration expired. It shall cover the period from registration expiration to surrender. (Beck Decl., Ex. 1 at pp. 1-2 [emphasis added].)

3. AHM or its designee shall inspect the Subject Vehicle at the time of surrender by Claimant to determine whether it is in the condition described in Paragraph No. 2, above. In the event AHM believes the Subject Vehicle is not in such condition, Claimant may elect to pay AHM the reasonable costs or repair as necessary to return the Subject Vehicle to the manufacturer’s specifications, or may elect to take possession of the Subject Vehicle in order to have the repairs made at Claimant’s own cost prior to surrender. If the Claimant declines both of these options, AHM or the Claimant may rescind this Agreement. (Beck Decl., Ex. 1 at p. 2.)

4. Claimant will cooperate with AHM and will execute all documents necessary for the transfer of ownership of the Subject Vehicle to AHM or its designee by taking all necessary steps to accomplish such transfer of ownership including, but not limited to, causing all Department of Motor Vehicle documentary transfer requirements to be completed before the transfer of the settlement sum to Claimant. Claimant shall deliver the Certificate of Title to the Subject Vehicle free and clear of all liens, fees, fines, DMV charges, assessments and encumbrances, to AHM when Claimant surrenders the Subject Vehicle to AHM, or its designee. (Beck Decl., Ex. 1 at p. 2.)  

In opposition, Defendant asserts that Plaintiff’s requested relief is moot because Defendant “is already in the process of carrying out the remaining settlement terms and has notified Plaintiff’s Counsel of the same.” (Opp’n at p. 2:4-6.) Defendant’s counsel, Kevin D. Zipser (“Zipser”), declares, inter alia, that the motion is moot because Defendant is in the process of carrying out the remaining settlement terms and has notified Plaintiff’s counsel of such. (Zipser Decl., ¶ 3.) Critically, counsel acknowledges that the surrender of the vehicle and issuance of the settlement checks are still outstanding, and that the time necessary to process the checks and schedule the vehicle surrender have taken longer than initially anticipated. (Zipser Decl., ¶¶ 4-5.) Counsel declares that Defendant “fully intends to comply, and is complying, with the remaining surrender and disbursement of the settlement checks.” (Zipser Decl., ¶ 5.)

On reply, Plaintiff contends that the motion is not moot because Defendant has done nothing since the motion was filed. (Reply at p. 1:3-5.)  

Although not raised by Defendant in the opposition, the court finds that Defendant is not in breach of the Settlement Agreement. With contracts, generally, a “time is of the essence” provision signals that a failure to perform within the time specified is a material breach of the contract. (Magic Carpet Ride LLC v. Rugger Investment Group, L.L.C. (2019) 41 Cal.App.5th 357, 367 (Magic Carpet), citing Gold Min. & Water Co. v. Swinerton (1943) 23 Cal.2d 19, 27; U.S. Hertz, Inc. v. Niobrara Farms (1974) 41 Cal.App.3d 68, 78.) However, “[t]he traditional rule has been tempered so that including a time is of the essence provision in a contract does not always make untimely performance a breach.” (Magic Carpet, supra, 41 Cal.App.5th at p. 367.) Thus, absent a time is of the essence provision and considering that the Settlement Agreement requires the parties to work together on the scheduling of the surrender (e.g., references to ‘mutually agreeable’ date and time), there is no showing that Defendant has breached the terms of the agreement by failing to perform the terms of the Settlement Agreement. (Not of Mot. at p. ii:11-13.)

Conclusion

Based on the foregoing, the motion is granted in part in that the motion to ENTER a judgment pursuant to the Settlement Agreement is granted, but the second form of relief to enforce that judgment is denied on the grounds that (i) the motion is procedurally defective and/or (ii) Defendant has not breached the settlement.