Judge: Lee W. Tsao, Case: 20NWCV00429, Date: 2024-05-28 Tentative Ruling
Case Number: 20NWCV00429 Hearing Date: May 28, 2024 Dept: C
Maria Otilia Cerna, et al. vs Elias Paniagua
Mejia, et al.
Case No.: 20NWCV00429
Hearing Date: May 28, 2024 @ 9:30 AM
#1
Tentative Ruling
Defendants/Cross-Complainants’ Motion to
Enforce Settlement Agreement is DENIED.
Plaintiffs to give notice.
Defendants/Cross-Complainants Elias Paniagua Mejia, Martha
Felicita Cerna, Jhoselin Lopez, Jeffrey Cerna, and Aristides Paiagua
(collectively “Defendants/Cross-Complainants”) move for an order enforcing the
terms of the settlement agreement between the parties pursuant to CCP § 664.6
and for attorney’s fees and costs of $3,310.00 for being required to enforce
the agreement.
Background
This lawsuit involves real property commonly known as 3802
Hill St, Huntington Park, CA 90255 ("Subject Property"). In a Complaint filed on August 6, 2020,
Plaintiffs Francisco Antoniel Cerna and Maria Otilia Cerna (“Plaintiffs”) alleged
that in or around 2009, they entered into an agreement with Defendant Elias
Paniagua Mejia whereby Plaintiffs would make the required down payment on the
Subject Property and Defendant Mejia would secure financing and hold title, in
trust, to the Subject Property for the benefit of Plaintiffs and that
Plaintiffs would be the true owners of the Subject Property. The Plaintiffs
further agreed to pay for the down payment, all applicable mortgage installment
payments, property taxes, insurance, and other fees and expenses associated
with the Subject Property. (Complaint, ¶ 21.) Defendant Mejia is the long-term
boyfriend of Plaintiffs’ daughter (Martha Felicita Cerna) and Plaintiffs held
him out to be their son-in-law. (Complaint, ¶ 4.) On or about July 28, 2020, Defendant
Mejia began selling the Subject Property without Plaintiffs’ consent.
(Complaint, ¶ 23.) Defendant Evan Garcia, a Real Estate Agent, helped Defendant
Mejia try to defraud Plaintiffs by listing the property for sale. (Complaint, ¶
24.) Plaintiff brought causes of action against Defendants Mejia and Garcia for:
1) Elder Abuse, 2) Breach of Fiduciary Duty, 3) Constructive Fraud, 4)
Resulting Trust – Purchase Money, and 5) Quiet Title in Real Property.
On March 22, 2021, Evan Garcia filed a Cross-Complaint
against Plaintiffs. On August 20, 2021,
Elias Paniagua Mejia, Martha Felicita Cerna, Jhoseliln Lopez, Jeffrey Cerna,
and Aristides Paniagua filed a Cross-Complaint against Plaintiffs. Both Cross-Complaints alleged Plaintiffs were
interfering with Defendants’ attempts to sell the property.
On September 20, 2022, pursuant to a confidential
settlement agreement, Plaintiffs and Defendant Mejia filed a stipulated
judgment (O’Reilly Decl., ¶ 4, Ex. B) which provides in relevant part:
·
Each party possesses a one-half interest in the
Subject Property (¶ 3)
·
The Subject Property shall be sold, and the
proceeds divided among the parties according to their respective interests (¶
4)
·
The parties will cooperate fully and reasonably
in performing all acts necessary to facilitate the listing and sale of the
Property as quickly as possible. (¶ 5)
·
Evan Garcia or another licensed real estate
agent will be appointed as referee with authority to sell the Property at
private sale, which manner of sale is determined by the Court to be most
beneficial to the parties. (¶ 6)
·
The Court will retain jurisdiction of the
action until the judgment is fully complied with or until further order of the
Court.
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.)
In
hearing a section 664.6 motion, the trial court may receive evidence, determine
disputed facts, and enter terms of a settlement agreement as a judgment.
(Bowers v. Raymond J. Lucia Companies, Inc. (2012) 206 Cal.App.4th 724,
732.) The court may interpret the terms and conditions to settlement (Fiore
v. Alvord (1985) 182 Cal.App.3d 561, 566), but the court may not create
material terms of a settlement, as opposed to deciding what terms the parties
themselves have previously agreed upon (Weddington Productions, Inc. v.
Flick (1998) 60 Cal.App.4th 793, 810.)
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.) The party seeking to enforce a settlement “must
first establish the agreement at issue was set forth ‘in a writing signed by
the parties’ (§ 664.6) or was made orally before the court.
[Citation.]” (Harris v. Rudin, Richman & Appel (1999) 74
Cal.App.4th 299, 304 [holding that a letter confirming the essential terms of a
settlement agreement was not a “writing signed by the parties” sufficient to
satisfy the requirements of Section 664.6].)
Discussion
Defendants/Cross-Complainants contend that Plaintiffs have
failed to comply with specific provisions of the settlement agreement that
require them to cooperate fully and reasonably perform all acts necessary to
facilitate the listing and sale of the Property as quickly as practicable. Defendants/Cross-Complainants allege that
Plaintiffs have tried to qualify for a loan to buy out the property instead of
carrying out the terms of the settlement.
In opposition, Plaintiffs argue that it is Evan Garcia, as
the referee, who has the responsibility to carry out the sale with the court’s
approval, not the defendants or plaintiffs. Plaintiffs argue they have
cooperated diligently with Evan Garcia and the delay in the sale is
attributable to Evan Garcia’s inaction. Plaintiffs
argue that Defendants are in breach of the settlement agreement by filing this
motion prior to engaging in mediation.
Under California law, a referee appointed by the court in a
partition action holds several responsibilities, including the duty to divide
the property and allot the portions to the parties according to their
interests. Moreover, the court may instruct the referee, fix their
compensation, and require the filing of interim or final accounts (CCP Section
873.010). Additionally, the referee is tasked with selling the property in
accordance with the procedures outlined in the Code. (CCP Section 873.510).
As a threshold matter, the Court determines that Defendants
have not breached the terms of the Stipulated Judgment by bringing the instant
motion. Plaintiffs argue that Defendants
are required to mediate the dispute before seeking court intervention. The Stipulated Judgment provides that “Any
dispute regarding the distribution of proceeds from the sale shall be
submitted to mediation.” (¶ 11, italics added.) Nothing in Defendants’ motion
takes issue with the distribution of proceeds from the sale (which has not
occurred). Defendants’ motion seeks to
enforce the settlement agreement on the grounds that Plaintiffs have not
cooperated in listing the property for sale.
As such, bringing the instant motion before mediation does not breach
the settlement agreement.
As to the merits of the motion, Defendants have not
demonstrated that Plaintiffs have breached the terms of the Stipulated Judgment
by attempting to qualify for a loan to purchase the property. Although Evan Garcia indicates there has been
a delay in receiving a purchase offer from Plaintiffs, he makes no claim that
Plaintiffs are presently interfering with the sale of the Subject Property.
(See Declaration of Evan Garcia, attached to Declaration of Edward J. O’Reilly,
Ex. C.) It is unclear to the Court how Plaintiffs have prevented Evan Garcia from
listing the Subject Property or how they have otherwise breached the terms of
the Stipulated Judgment by attempting to qualify for a loan.
Accordingly, the motion to enforce the settlement agreement
is DENIED. No sanctions are
imposed.