Judge Randolph M. Hammock, Case Number: 22STCV04216, Date: 2024-05-23 Tentative Ruling

Judge: Randolph M. Hammock, Case: 22STCV04216, Date: 2024-05-23 Tentative Ruling

Plaintiffs move the court for an order recognizing and enforcing the terms of a settlement agreement entered into between the parties. On February 26, 2024, Plaintiffs filed a Notice of Settlement. On April 29, 2024, Plaintiffs filed the instant motion to enforce the settlement.

Plaintiffs present evidence that Plaintiffs timely and properly accepted Defendants’ CCP section 998 offer to compromise on February 23, 2024. (Rothman Decl. Exh. 1.) The 998 Offer required FCA to accept surrender of Plaintiffs’ vehicle and pay Plaintiffs’ counsel the settlement funds ($40,572.00) by April 23, 2024, or within 60 days of Plaintiffs’ acceptance of the 998 Offer. (Id.) The 998 Offer also required FCA to pay interest at 10% per annum from the date of acceptance until the date Plaintiffs’ counsel receives the settlement funds should FCA fail to timely perform its obligations. (Id.)

On April 15, 2024, Plaintiffs’ counsel emailed Defense counsel to inform them that the April 23, 2024, deadline to reacquire the vehicle was approaching. (Rothman Decl., ¶ Exh. 2.) Defense counsel did not respond to that email. (Id.) Plaintiffs’ counsel followed up on April 23, 2024, with another email, again without a response. (Id.) Because Defendant failed to facilitate surrender of Plaintiffs’ vehicle and failed to pay the settlement funds by April 23, 2024, this motion followed.

If the parties to pending litigation stipulate, in a writing signed by the parties [FN 2] 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.

“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. [Citations]. A settlement is enforceable under section 664.6 only if the parties agreed to all material settlement terms.” (Hines v. Lukes (2008) 167 Cal. App. 4th 1174, 1182.) “The court ruling on the motion may consider the parties' declarations and other evidence in deciding what terms the parties agreed to,” and “[i]f 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.” (Id.)

“Strong public policy in favor of the settlement of civil cases gives the trial court, which approves the settlement, the power to enforce it.” (Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1357.) Likewise, in “ruling on a motion to enforce settlement,” the Court “necessarily has the power to resolve factual disputes relating to the agreement.” (Ibid.) Of course, this also means that it is “for the trial court to determine in the first instance whether the parties have entered into an enforceable settlement.” (Id. at 1360.)

Here, Plaintiffs have demonstrated that the parties—all represented by counsel—signed a section 998 offer. (Rothman Decl. Exh. 1.) The offer requires Defendants to “pay Plaintiffs $40,572.00…in exchange for…Return of the 2017 Alfa Giulia,” among other things. (Rothman Decl., Exh. 1, ¶ 1.) The parties agreed the settlement funds “shall be sent to Plaintiff’s counsel prior to the vehicle surrender, and held in trust pending proof of successful vehicle surrender…” (Rothman Decl., Exh. 1, ¶ 6.) The Agreement provided it is “an express condition of this Offer that, if accepted, Defendant will perform its obligations within 60 days of acceptance.” (Rothman Decl., Exh. 1, ¶ 6.) Finally, if “FCA does not timely perform pursuant to the terms set forth herein, Plaintiff shall be entitled to interest at a rate of 10% per annum, from the date of acceptance of this offer until the date Settlement Funds are received.” (Rothman Decl., Exh. 1, ¶ 7.) The agreement provides the Court “will retain jurisdiction to enforce this offer of compromise under Code of Civil Procedure Section 664.6.” (Rothman Decl., Exh. 1, ¶ 10.)

Here, the court finds the Section 998 offer signed by all parties constitutes an enforceable settlement agreement, and that Defendant has defaulted under that agreement by not providing the settlement payment or facilitating return of the vehicle within 60-days of Plaintiffs’ acceptance.

Judge of the Superior Court

FN 1- Plaintiffs served the moving papers on Defendant by email on April 29, 2024. (See Proof of Service.)

FN 2- A writing is “signed by a party” if it is signed by “[a]n attorney who represents the party.” (CCP § 664.6(b)(2).)

FN 3- Plaintiffs contend they are “entitled to enforce the settlement agreement and recover the full settlement funds of $40,572.00 without surrendering the vehicle per Civil Code section 1440.” (Mtn. 3: 14-16, emphasis added.) Section 1440 provides: “If a party to an obligation gives notice to another, before the latter is in default, that he will not perform the same upon his part, and does not retract such notice before the time at which performance upon his part is due, such other party is entitled to enforce the obligation without previously performing or offering to perform any conditions upon his part in favor of the former party.” Plaintiffs have not provided any meaningful analysis of this code section, much less authority applying it to a vehicle surrender under similar circumstances. There is also apparently no term of the settlement stating that Defendants “waive” the right to recover the vehicle in the event of late payment. Therefore, surrender of the vehicle remains a material term of the settlement, and as such, a material term of the judgment to be entered in this case.