Judge: Daniel S. Murphy, Case: 22STCV14536, Date: 2025-05-28 Tentative Ruling

Case Number: 22STCV14536    Hearing Date: May 28, 2025    Dept: 32

BACKGROUND

            On May 2, 2022, Azad Azad Steel, Inc. (Azad) filed this action against Defendants RCG Construction Group (RCG) and Youssef Mikhail (Mikhail), asserting causes of action for (1) breach of contract, (2) quantum meruit, (3) account stated, and (4) open book account.

            Azad was the subcontractor on a construction project in which RCG was the primary contractor. Azad and RCG entered into a written agreement whereby Azad would complete a portion of the project relating to the fabrication and installation of structural steel. RCG also allegedly ordered additional work from Azad and promised to pay for it. Mikhail is allegedly RCG’s alter ego. Azad filed this action to recover unpaid compensation.

            The case was dismissed on August 20, 2024 pursuant to Azad’s request after the parties reached a settlement. Azad filed a notice of settlement on August 21, 2024.

            On April 28, 2025, Azad filed the instant motion to enforce settlement. Defendants filed their opposition on May 14, 2025. Azad filed its reply on May 20, 2025.  

LEGAL STANDARD

“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.” (Code Civ. Proc., § 664.6.) A settlement agreement is a contract, and the legal principles which apply to contracts generally apply to settlement contracts.¿(Weddington Productions, Inc. v. Flick (1998) 60 Cal. App. 4th 793, 815.)

When ruling on a section 664.6 motion, the trial court acts as a trier of fact to determine whether a settlement has occurred, which is also an implicit authorization for the trial court to interpret the terms and conditions to settlement. (Skulnick v. Roberts Express, Inc. (1992) 2 Cal. App. 4th 884, 889.) “Trial judges may consider oral testimony or may determine the motion upon declarations alone.” (Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1360.)

DISCUSSION

I. The Settlement Terms

            The settlement was executed between Azad, on the one hand, and RCG and Mikhail on the other. (Finamore Decl., Ex. A at p. 1.) RCG and Mikhail are defined collectively as “Renaissance.” (Ibid.)

            The settlement requires Renaissance to pay Azad a total of $85,000. (Finamore Decl., Ex. A, § 3(a).) The settlement additionally requires Renaissance to “file a lawsuit against Snow Hill Development [the project owner] for unpaid sums owed to RENAISSANCE on the construction project at the Property.” (Ibid.) The settlement requires Renaissance to pay Azad a specified portion of the proceeds from the Snow Hill litigation. (Id., § 3(c).)  

            In the present motion, Azad requests the Court to enter judgment requiring payment of the outstanding amount, plus the costs of enforcing the settlement, and requiring RCG and Mikhail to file suit against Snow Hill.  

II. Payment

            To date, Renaissance has paid Azad $12,100, leaving an outstanding balance of $72,900. (Finamore Decl. ¶¶ 5-7.) Defendants do not dispute the amount owed but argue that only RCG, and not Mikhail, is responsible for the payment, because the agreement states that “Renaissance shall pay to Azad . . . .” (Id., Ex. A, § 3(a).) However, the settlement defines “Renaissance” as RCG and Mikhail collectively. (Id. at p. 1.) Defendants acknowledge this definition but simply conclude without explanation that “the manner in which the term ‘RENAISSANCE’ is defined is ambiguous, at best.” (Opp. 3:6-7.)

            The Court finds that the term “RENAISSANCE” is unambiguously defined as RCG and Mikhail collectively. Defendants provide no explanation, evidence, or legal authority to support their contention that the term is ambiguous. Therefore, RCG and Mikhail are jointly and severally liable for the outstanding payment.

III. Snow Hill Lawsuit

            Azad cites no authority allowing a trial court to order a party to file a lawsuit as part of a judgment. The Court instead orders Defendants to pay Azad 50% of the “Net Proceeds” from any lawsuit against Snow Hill for unpaid sums owed to Defendants for work on the project. (See Finamore Decl., Ex. A, § 3(a), (c).)  

            Azad argues that the settlement agreement requires Defendants to file suit against Snow Hill, that Defendants voluntarily negotiated this term, and that Azad relied on Defendants’ representations in executing the settlement agreement. Azad may file independent causes of action for breach of contract and fraudulent inducement, but the Court still has no authority to force Defendants to file a lawsuit.

IV. Costs of Enforcement

            The settlement also contains the following term: “Should any arbitration, action or other proceeding be necessary to enforce the terms of this Agreement, the prevailing party shall be entitled to all reasonable attorneys’ fees and costs incurred.” (Finamore Decl., Ex. A, § 9.)

            The instant motion is a “proceeding . . . to enforce the terms of this Agreement.” Azad is the prevailing party on the motion. Thus, Azad is entitled to recover its attorneys’ fees and costs. Azad incurred a total of $4,690 to enforce the settlement. (See Finamore Decl. ¶¶ 12-13.) Defendants do not challenge this amount. The Court finds the amount to be reasonable. 

            Thus, Azad is awarded $4,690 for enforcing the settlement.

CONCLUSION

            Plaintiff’s motion to enforce settlement is GRANTED.

Judgment is entered in favor of Plaintiff Azad Steel, Inc. and against Defendants Renaissance Construction Group, Inc. and Youssef Mikhail, jointly and severally, in the amount of $77,590.

Additionally, Defendants Renaissance Construction Group, Inc. and Youssef Mikhail shall pay to Plaintiff Azad Steel, Inc. 50% of the “Net Proceeds” from any lawsuit against Snow Hill Development for unpaid sums owed to Defendants for the project. Payment shall be made within 10 days of receipt.