Judge: Helen Zukin, Case: 19SMCV01867, Date: 2023-04-26 Tentative Ruling
Case Number: 19SMCV01867 Hearing Date: April 26, 2023 Dept: 207
Background
Plaintiff Villa Erripa, LLC (“Plaintiff”) brought this
action against Defendants Walter Adrian and Pamela Estelle Rumph (“Defendants”)
to recover unpaid rent allegedly owed to Plaintiff. This action was previously
dismissed at the joint request of the parties pursuant to a settlement
agreement. As part of this settlement, Defendants were required to make monthly
payments to Plaintiff or face entry of a stipulated judgment against them.
Plaintiff now moves the Court to vacate the dismissal of this action and enter
judgment against Defendants, claiming they have failed to make the monthly
payments required by the parties’ agreement. Plaintiff’s motion is unopposed.
Plaintiff’s motion originally came on for hearing before the
Court on March 15. At that time the Court continued the hearing on this matter,
and directed Plaintiff to serve Defendants with the motion. At the continued
hearing on April 5, 2023, the Court granted Defendant Pamela Rumph’s
(“Defendant”) request for a further continuance to provide a supplemental
response to Plaintiff’s motion. The parties timely filed their supplemental
briefing pursuant to the Court’s order and the matter is now fully briefed and
ready for determination by the Court.
Legal Standard
Code Civ.
Proc. § 664.6 provides a summary procedure that enables judges to enforce a settlement
agreement by entering a judgment pursuant to the terms of the parties’ settlement.
In particular, the statute provides:
(a)
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.
(b)
For purposes of this section, a writing is signed by a party if it is signed by
any of the following:
(1)
The party.
(2)
An attorney who represents the party.
(3)
If the party is an insurer, an agent who is authorized in writing by the insurer
to sign on the insurer's behalf.
(C.C.P.¿§
664.6(a)-(b).)
Strict compliance with the statutory requirements is
necessary before a court can enforce a settlement agreement under this statute.
(Sully-Miller Contracting Co. v. Gledson/Cashman
Construction, Inc. (2002)
103 Cal.App.4th 30, 37.) One of the requirements is that the agreement must be
signed by the parties “seeking to enforce the agreement under section 664.6 and
against whom the agreement is sought to be enforced.” (Harris v. Rudin,
Richman & Appel (1999) 74¿Cal.App.4th 299, 305.) The purpose of
this requirement is to “facilitate the summary nature of the proceeding by
decreasing the likelihood of misunderstandings and ‘minimiz[ing] the
possibility of conflicting interpretations of the settlement.” (Id.
[citing Levy v. Superior Court (1995) 10 Cal. 4th 578, 585].)
Analysis
In 2021 Plaintiff and Defendants
reached a settlement on Plaintiff’s claims and entered into a Settlement
Agreement and Mutual Release. (Ex. A to Poumadere Decl.) Under the terms of the
settlement, Defendants were to pay Plaintiff the sum of $30,000, to be paid
through an initial payment of $2,000 followed by monthly installments of $600
over 47 months beginning on December 15, 2021. (Id. at ¶3.) Once
Defendants paid this initial $30,000, the parties agreed Defendants would sit
for a debtors examination or deposition regarding their financial position. The
agreement then provided a scale for additional payments to be made by
Defendants based on the results of that examination. (Id. at ¶4.) Defendants
also provided Plaintiff an executed Stipulation for Entry of Judgment, which
they agreed Plaintiff could file with the Court if Defendants defaulted on
their payment obligations. (Id. at ¶5.) In return, Plaintiff agreed to
file a request for dismissal of its claims against Defendants. (Id. at
¶6.) The settlement agreement further provides the Court shall retain
jurisdiction under Code Civ. Proc. § 664.6 to enter the judgment as stipulated
by the parties. (Id. at ¶14.)
In the Stipulation for Entry of
Judgment executed by the parties, the parties agreed to entry of a stipulated
judgment against Defendants in the principal amount of $181,928.60 plus
interest at the rate of 10% per annum from November 2021. (Ex. B to Poumadere
Decl. at ¶1.) Plaintiff agreed to provide Defendants and their counsel with
notice if Defendants defaulted on any of their payment obligations. (Id.
at ¶4.) If Defendants failed to cure their default within 10 days of
Plaintiff’s notice or defaulted three times in any twelve-month period, they
agreed Plaintiff would “conclusively have the right to have the court enter the
judgment” in the stipulated amount, less any payments made by Defendants to
date. (Id.) Plaintiff also agreed to provide notice to Defendants and
Defendants’ counsel before applying to the Court for entry of judgment
following Defendants’ default. (Id. at ¶5.) Defendants also agreed to
pay Plaintiff’s reasonable costs and attorney’s fees incurred in seeking entry
of judgment following Defendants’ default. (Id.)
Plaintiff claims Defendants made
payments pursuant to the parties’ agreement totaling $6,600, before defaulting
on the payments required for the months November 2022 through February 2023.
(Poumadere Decl. at ¶¶14-16.) Pursuant to the parties’ agreement, Plaintiff
seeks entry of judgment against Defendants in the amount of $204,140.75,
calculated as $181,928.60 in principal, $24,257.15 in interest, and $4,555 in
attorney’s fees and costs, less $6,600 in payments made by Defendants.
In her initial opposition,
Defendant requested additional time to respond to Plaintiff’s motion, claiming
she had been prejudiced in being forced to prepare and file an opposition in
less time than is proscribed by Code Civ. Proc. § 1005(b). The Court granted
her request, noting the law favors resolution of claims on their merits, and
allowing Defendant to file a supplemental opposition including any additional
points she was not able to address in her original opposition. Defendant’s
supplemental opposition, filed April 14, 2023, contains no such response to
Plaintiff’s original motion and instead is limited solely to attacking
arguments raised by Plaintiff’s reply brief, filed after Defendant filed her
opposition. Defendant did not request—and was not granted—leave to file a
surreply to respond to Plaintiff’s reply, Defendant was granted leave to
supplement her response to Plaintiff’s original motion to include material she
claimed she had been unable to address due to the time constraints imposed on
her in drafting the opposition.
1. Default
The first question presented by
the Court is whether Defendants defaulted on their payments under the
settlement agreement such as to trigger the provisions allowing Plaintiff to
seek entry of the stipulated judgment. As set forth above, default can be
triggered in either of two ways under the Stipulation: (1) by failing to cure
default within 10 days of Plaintiff’s giving of written notice, or (2) by
defaulting on their payments more than three times in any 12-month period,
regardless of whether Defendants have cured this default.
Plaintiff has provided evidence
showing Defendants defaulted on their October 2022 installment payment.
Plaintiff provided notice of this default by email and telephone on November 10,
2022. (Poumadere Decl. at ¶14, Ex. C to Poumadere Decl.) Defendants also
defaulted on the November 2022 installment payment, and Plaintiff again
provided notice by email and telephone on November 16, 2022. (Poumadere Decl.
at ¶15, Ex. D to Poumadere Decl.)
As Defendant explained in both of her filings, and which is confirmed by the death certificate attached to her supplemental opposition, her husband - the other Defendant Walter Adrian – passed away in August 2022. Defendant sent one payment of $600
to Plaintiff on November 25, 2022. (Poumadere Decl. at ¶14.) Plaintiff claims
this payment was an untimely attempt to satisfy the cure the default of the
October 2022 payment. Defendant claims this payment instead timely cured the
default of the November 2022 payment. Defendant argues she never saw the
November 10 email providing written notice of the default under the October
2022 payment, speculating that it may have gone to her junk mail folder.
Defendant does not dispute that Plaintiff sent the email as required by the
Stipulation, rather she contends the notice is insufficient to trigger the
entry of the stipulated judgment because she never viewed it. The Court rejects
this argument.
The Stipulation requires Plaintiff
provide written notice of default by email, and expressly states that “Notice
shall be effective upon the date of transmittal e-mail and telephone notice.”
(Ex. B to Poumadere Decl., at ¶4.) The Settlement Agreement similarly provides
that notice is deemed to have been made “upon transmission” of an email. (Ex. A
to Poumadere Decl. at ¶19.) Nothing in the Agreement or Stipulation conditions
the entry of the stipulated judgment on Defendants’ receipt, review, or
acknowledgment of the written notice. Defendant complains that Plaintiff’s
November 16, 2022, email did not expressly indicate she had defaulted on both
monthly payments for October and November. Yet, nothing in the Stipulation or
Agreement required Plaintiff to provide a second notice that Defendants had
defaulted on the October 2022 payment. Further, Defendant herself acknowledges
the November 16, 2022, email bore a subject line stating it was the “2nd Notice
of Default of Settlement Agreement.” (Opp. at 5.) Yet, Defendant does not
appear to have made any investigation into the first notice of default.
Defendant speculates the first email was routed to her spam folder and
automatically deleted after 30 days, but by the time Defendant received the
second email on November 16, only six days had elapsed since the first email
was sent, and Defendant could have checked her spam folder and timely cured the
October 2022 default.
Whether Defendant’s November 25
payment is applied to the October 2022 or November 2022 installment is
ultimately immaterial, as in either case Defendant failed to timely cure the
noticed default for at least one of these monthly installment payments. This is
sufficient to trigger the entry of the stipulated judgment pursuant to the
terms of the parties’ agreements.
2. Entry of Stipulated Judgment
Defendant argues the entry of a
stipulated judgment against her and her husband’s estate in the amount of $204,140.75
would be an unfair or unreasonable remedy for defaulting on a payment of only
$600, yet this is the exact remedy Defendants bargained for to secure the
dismissal of Plaintiff’s claims. If Defendants believed these terms were too
onerous or one-sided, they could have rejected the Agreement and proceeded to
trial on Plaintiff’s claims. However, Defendant cannot agree to terms to secure
dismissal of Plaintiff’s claims and then turn around and claim it would be
unfair to enforce those same terms against her.
The same is true with respect to
Defendant’s argument that the stipulated judgment is an unreasonable punitive
penalty. Defendant expressly agreed “that (a) the judgment for monetary damages
provided for herein is a judgment the court could reasonably enter on the complaints
in the Consolidated Actions, and (b) the judgment amount is reasonable and is
not a penalty for failure to perform this settlement as described in the case
of Greentree Financial Group, Inc. v Execute Sports Inc. (2008) 163
Cal.App.4th 495.” (Ex. B to Poumadere Decl., at ¶1.) Defendant has thus
expressly waived any argument that the amount of the stipulated judgment is an
improper or punitive penalty for failure to perform under the Agreement.
Defendant also argues the judgment
should be limited to $30,000 because “the total current net value of the combined
assets of her and her deceased spouse, Walter Adrian’s estate, is less than
$60,000.” (Opp. at 9.) Under the Stipulation and Settlement Agreement,
Defendants’ financial condition only becomes relevant “If Defendants pay the
entire [$30,000] Initial Settlement Sum to Plaintiff by timely paying (or
prepaying) each of the above installments.” (Ex. B to Poumadere Decl. at ¶2.)
As set forth above, Defendants failed to satisfy this requirement as they
failed to timely make payments for at least one month. It is also undisputed
that Defendants have never paid the entire $30,000 initial sum, whether timely
or not. Having failed to pay the entire initial settlement amount, Defendant
cannot take advantage of the provision which allows for the consideration of her
financial condition in determining whether she owes any further sums.
Ultimately, Defendant’s arguments
all boil down to her dissatisfaction with the terms of the Settlement Agreement
and Stipulation itself. But those terms were expressly bargained for and agreed
to by Defendants. Defendant has not shown or suggested the parties’ agreements
were falsified or entered into under duress. Having bargained for these terms,
Defendant is bound by them.
For these reasons, the Court
GRANTS Plaintiff’s motion to vacate the dismissal of this action and enter the
stipulated judgment pursuant to the parties’ prior agreement.
Conclusion
Plaintiff’s Motion
to Vacate Dismissal and Enter Stipulated Judgment is GRANTED.