Judge: Stephen Morgan, Case: 20AVCV00875, Date: 2022-12-29 Tentative Ruling

                                                                           Department A14 Tentative Rulings 

If parties are satisfied with the tentative ruling, parties may submit by emailing the courtroom at ATPDeptA14@LACOURT.ORG. 

If a matter is also scheduled for a CMC, TSC, OSC, etc., an appearance is still required even if the parties are willing to submit on the tentative ruling.



Case Number: 20AVCV00875    Hearing Date: December 29, 2022    Dept: A14

Background

 

This is a premises liability action. Plaintiff Horacio Covarrubias (“Plaintiff”) alleges that on December 23, 2018 around 2:30 pm, he was at Walmart Superstore 1660, owned by Defendant Walmart, Inc., erroneously sued as Walmart Claims Management, Inc./AR Claims Management, Inc. (“Defendant), and located in west Palmdale, California. Plaintiff further alleges that the floor between aisles 18 and 19 were not free of debris and, because of this, he slipped and fell, sustaining bodily injuries. 

 

On December 22, 2020, Plaintiff filed his Complaint alleging one cause of action in Negligence.  

 

On April 09, 2021, Defendant responded in the form of a Motion to Strike Punitive Damages, subsequently granted.  

 

On June 07, 2021, Defendant filed its Answer.  

 

On December 05, 2022, Defendant filed this Motion to Enforce Settlement.

 

On December 16, 2022, Plaintiff filed his Opposition.

 

On December 22, 2022, Defendant filed its Reply.

 

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Legal Standard

 

Legal Standard for Judgment Pursuant to the Terms of Settlement – “ ‘The Legislature has now provided that a motion to enter judgment pursuant to such a settlement need not be a motion for summary judgment.’ (Corkland v. Boscoe (1984) 156 Cal.App.3d 989,991 [203 Cal.Rptr. 356].) Section 664.6, enacted in 1981, explicitly provides statutory authorization for the entry of judgment upon a stipulated settlement by means of a noticed motion.” (Casa de Valley View Owner's Assn. v. Stevenson (1985)167 Cal.App.3d 1182, 1189.)

 

Cal. Code Civ. Proc. § 664.6 reads:

 

(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) Paragraphs (2) and (3) of subdivision (b) do not apply in a civil harassment action, an action brought pursuant to the Family Code, an action brought pursuant to the Probate Code, or a matter that is being adjudicated in a juvenile court or a dependency court.

(d) In addition to any available civil remedies, an attorney who signs a writing on behalf of a party pursuant to subdivision (b) without the party’s express authorization shall, absent good cause, be subject to professional discipline.

 

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Discussion

 

Application – Defendant argues that the Court is permitted to enter judgment on the settlement agreement that the parties entered outside of the presence of the Court under Cal. Code Civ. Proc. § 664.6.

 

Defendant summarizes the timeline between the parties as:

 

(Motion, Background and Relevant Facts section.)

 

Defendant argues that a settlement was entered into, there was a condition precedent requiring Plaintiff to send the Request for Dismissal to Defendant’s counsel, Plaintiff frustrated the 30-day Contingency Clause, and breached the agreement. Because of these actions, Defendant requests the Court enter judgment under 664.6.

 

Defendant also provides the following case law to support its argument:

 

Section 664.6 permits the trial court judge to enter judgment on a settlement agreement without the need for a new lawsuit. (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 809–810 [71 Cal. Rptr. 2d 265].) It is for the trial court to determine in the first instance whether the parties have entered into an enforceable settlement. (Elyaoudayan v. Hoffman (2003) 104 Cal.App.4th 1421, 1428–1429 [129 Cal. Rptr. 2d 41].) In making that determination, “the trial court acts as the trier of fact, determining whether the parties entered into a valid and binding settlement. [Citation.] . . . The trial court's factual findings on a motion to enforce a settlement pursuant to section 664.6 “are subject to limited appellate review and will not be disturbed if supported by substantial evidence.” (Williams v. Saunders (1997) 55 Cal.App.4th 1158, 1162).

 

(Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 1360.)

 

The Court has read Plaintiff’s Opposition. It appears that the gravamen of Plaintiff’s argument is that, though he signed and sent a signed copy of the agreement to defense counsel, he had no notice that the agreement was finalized. Additionally, Plaintiff admitted to incorporating a contingency clause in which it is stated that the settlement must be completed within 30 days.

 

Defendant’s Reply highlights the condition precedent, reiterates that it was frustrated by Plaintiff, and emphasizes that Plaintiff is sophisticated as he has repeatedly represented to the Court that routinely he buys and sells real estate. Defendant believes that any representation that Plaintiff was unaware that the agreement was reached as Plaintiff has provided on record and in statements that he intended to use the settlement funds as a “hard money loan” on October 29, 2022.

 

The Court looks to the settlement agreement. The two clauses that the parties are in disagreement are worded as follows:

 

6. DISMISSAL OF SUIT/COVENANT NOT TO SUE. Prior to or contemporaneously with the execution and delivery of this Agreement, Plaintiff shall immediately execute and deliver to counsel for Wal-Mart a Request for Dismissal, with Prejudice of Plaintiff’s Suit. After confirmation that Plaintiff Counsel is in receipt of settlement funds, Counsel for Wal-Mart will file that document with the court and provide conformed copies of the Request for Dismissal, with Prejudice, upon receipt, and shall further deliver or cause to be delivered to Wal-Mart, such other pleadings or documents, if any, reasonably requested by Wal-Mart and necessary to effectuate the dismissal with prejudice of the Suit. Plaintiff acknowledges and agrees that Plaintiff’s full and complete satisfaction of Plaintiff’s obligations under this Section 6 is a condition precedent to Wal-Mart’s obligation to make the payment referenced in Section 1 of this Agreement. . .”

 

[. . .]

 

CONTIGENCY CLAUSE. this Agreement is to close in 30 days from September 29, 2022 to October 28, 2022 in the even the check is not In Plaintiffs Hands, This Document Will Become Invalid Voided and we will resume where we left off going to trial no other offer will be consider no extension or excuses this would be the 2nd attempt in closing Plaintiff agrees to settlement. Amount of 33,000.00 within 30 days to closing starting September 29, 2022 with terms and conditions set forth in paragraph 9.

 

(Decl. Michael F. Colbert, Exh. 1 [original wording provided].)

 

The Court believes that both clauses are clear.

 

In general, whether mutual assent exists—whether there has been a meeting of the minds—is determined by objective rather than subjective criteria. (J.B.B. Inv. Partners Ltd. v. Fair (2019) 37 Cal.App.5th 1, 11; Harshad & Nasir Corp. v. Global Sign Sys., Inc. (2017) 14 Cal.App.5th 523, 537; Esparza v. Sand & Sea, Inc. (2016) 2 Cal.App.5th 781, 788; Rodriguez v. Oto (2013) 212 Cal.App.4th 1020, 1027 [in absence of fraud or mistake, there need not be "a subjective meeting of the minds … the outward manifestation or expression of consent is controlling"]. See also Avery v. Integrated Healthcare Holdings, Inc. (2013) 218 Cal.App.4th 50, 67; Bustamante v. Intuit, Inc. (2006) 141 Cal.App.4th 199, 208; ASP Props. Group, L.P. v. Fard, Inc. (2005) 133 Cal.App.4th 1257, 1269.) The test is whether a reasonable person would conclude from the outward conduct of the parties that there was mutual agreement. (Marin Storage & Trucking, Inc. v. Benco Contracting & Eng'g, Inc. (2001) 89 Cal.App.4th 1042, 1049; Weddington Prods., Inc. v. Flick (1998) 60 Cal.App.4th 793, 811.) In determining whether there is mutual consent, the principal focus is on the acts of the parties as distinct from their unspoken thoughts. (Martinez v. BaronHR, Inc. (2020) 51 Cal.App.5th 962 [party's unexpressed subjective intentions were irrelevant to issue of mutuality]; Rodriguez v. Oto, supra, 212 Cal.App.4th 1020; Meyer v. Benko (1976) 55 Cal.App.3d 937, 943.) This approach conforms with the objective theory of contract generally followed in California. (See, e.g., Stewart v Preston Pipeline, Inc. (2005) 134 Cal.App.4th 1565, 1587. See also In Beard v Goodrich (2003) 110 Cal.App.4th 1031 [the court found that an attorney's unsubstantiated assertion regarding his subjective intent was insufficient to establish that there had not been a meeting of the minds regarding a contingency fee agreement]; Patel v Liebermensch (2008) 45 Cal.4th 344, 351 [the court held that a post-formation dispute over the terms of a real estate option contract did not indicate that there had been no meeting of the minds].)

 

Here, Plaintiff has initialed every page of the settlement agreement, including the page that discusses the condition precedent. The only insight provided by Plaintiff regarding the signing of the settlement agreement is that he was in Texas at the time of signing. (See Opposition ¶4.)

 

Plaintiff’s acts demonstrate that he understood the contract.

 

Regarding Plaintiff’s contention that he was not noticed of the finalized agreement, Exh. 2 to the moving papers show an email thread in which Defense counsel’s firm, reached out to Plaintiff on multiple occasions regarding the Request for Dismissal in exchange for the check, indicating that the settlement was finalized. The emails include an offer for a simultaneous exchange of check and the Request for Dismissal. (See Exh. 2.) As such, Plaintiff has been on notice that the settlement was finalized and in the process of execution as of October 11, 2022. Plaintiff did not respond to defense counsel’s emails.

 

Under California law, one who assents to a contract is bound by its provisions and cannot complain of unfamiliarity with the language of the instrument. (Madden v. Kaiser Foundation Hospitals (1976) 17 Cal. 3d 699, 710.) Reasonable diligence requires the reading of a contract before signing it and a party cannot use his own lack of diligence to avoid an arbitration agreement. (24 Hour Fitness v. Superior Court (1988) 66 Cal. App. 4th 1199, 1215.) Further, California law has found that "[o]rdinarily, one who accepts or signs an instrument, which on its face is a contract, is deemed to assent to all its terms, and cannot escape liability on the ground that he has not read it.  If he cannot read, he should have it read or explained to him." (Randas v. YMCA of Metropolitan Los Angeles (1993) 17 Cal. App. 4th 158, 163 [citing 1 Witkin, Summary of Cal. Law (9th ed. 1987) § 120, p. 145].)

 

Plaintiff signed the settlement agreement which included the delivery of the Request for Dismissal as a condition precedent. Plaintiff’s outward actions indicated that he understood the clause in paragraph 6. Plaintiff is bound by the settlement agreement.

 

The doctrine of frustration of purpose is summarized in the Restatement Second of Contracts, section 265, as follows:

 

“Where, after a contract is made, a party's principal purpose is substantially frustrated without his fault by the occurrence of an event the non-occurrence of which was a basic assumption on which the contract was made, his remaining duties to render that performance are discharged, unless the language or circumstances indicate the contrary."

 

Under the doctrine of frustration of purpose, Defendant is excused from delivering the check as Plaintiff’s failure to send the Request for Dismissal to Defendant prevented Defendant from sending the check within the 30-day limit that Plaintiff had inserted into the contract.

 

A court’s power to make factual determinations under Cal. Code Civ. Proc. § 664.6 (entry of judgment pursuant to settlement), is generally limited to whether the parties entered into a valid and binding settlement agreement. Judgment may be entered under § 664.6 whether or not the parties are complying with the terms of the agreement. (Viejo Bancorp, Inc. v. Wood, (1989) 217 Cal. App. 3d 200, 209 fn. 4.)

 

As a valid agreement was entered by both parties, judgement may be entered under Cal. Code Civ. Proc. § 664.6.

 

Accordingly, the motion is GRANTED.

 

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Conclusion

 

Defendant Walmart, Inc.’s Motion to Enforce Settlement is GRANTED.