Judge: Teresa A. Beaudet, Case: 18STCV10254, Date: 2025-03-07 Tentative Ruling

Case Number: 18STCV10254    Hearing Date: March 7, 2025    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

            Background

Plaintiff Lizbeth Padilla (“Plaintiff”) filed an action against Defendant Hyundai Motor America (“Defendant”) on December 28, 2018, for violations of the Song-Beverly Act regarding a 2013 Hyundai Tucson. On June 25, 2024, Defendant served a Code of Civil Procedure section 998 for $60,000, including attorney fees and costs, in exchange for the vehicle’s surrender. Plaintiff accepted the offer on June 26, 2024, settling the case.

On July 2, 2024, the parties filed a Joint Stipulation under which the action would be dismissed without prejudice but the Court would retain jurisdiction under Code of Civil Procedure § 664.6 to enforce the terms of the Settlement Agreement. The Court entered the Order on this Joint Stipulation on July 3, 2024.

Plaintiff claims that to date, Defendant has not performed, has not accepted surrender of the Subject Vehicle, has not provided a date certain for surrender or payment, and has not made payment of the agreed-upon amount. Plaintiff requests the Court enter the settlement and enter a judgment based on the Settlement Agreement. Defendant opposes and Plaintiff replies.

Legal Standard

“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 the parties to the settlement agreement or their counsel stipulate in writing or orally before the court, the court may dismiss the case as to the settling parties without prejudice and retain jurisdiction over the parties to enforce the settlement until performance in full of the terms of the settlement.” (Code Civ. Proc., § 664.6, subd. (a).) 

“Although a judge hearing a section 664.6 motion may receive evidence, determine disputed facts, and enter the terms of a settlement agreement as a judgment, nothing in section 664.6 authorizes a judge to create the 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 [internal citations omitted, emphasis in original].)

            Discussion

            Plaintiff argues that Defendant has failed to comply with its obligations under the Settlement Agreement, which required performance by August 25, 2024. Despite Plaintiff providing all necessary information and documents by July 8, 2024, Defendant has not responded to repeated inquiries about compliance. Plaintiff asserts that the Settlement Agreement is enforceable, and the Court has the authority to enter judgment under §§ 664.6 and 998.

Plaintiff seeks judgment entry to enable enforcement through a writ of execution. Additionally, Plaintiff argues for prejudgment interest under Civil Code § 3287(a), asserting that Defendant owes $60,000 from August 25, 2024, and is not legally prevented from payment. Plaintiff calculates total prejudgment interest at $3,879.84, applying a 10% annual rate per Civil Code § 3289(b), covering the period from August 25, 2024, to the hearing date of April 17, 2025.

In opposition, Defendant acknowledges that its opposition was filed late due to a calendaring error after the hearing date was advanced. Upon realizing the mistake, Defendant promptly submitted its opposition and does not object to allowing Plaintiff additional time to reply.

However, Defendant argues that Plaintiff’s motion should be denied. The defendant asserts that the settlement process is nearly complete. The check was processed after holiday closures, and Sedgwick, the third-party surrender agent, was assigned to handle the matter. On January 15, 2025, Sedgwick informed Plaintiff’s counsel that the funds would be available within 10-14 business days, after which a surrender date would be scheduled at South Bay Hyundai. Defendant contends that logistical delays are common in high-volume lemon law cases and argues that Plaintiff’s concerns about non-completion are exaggerated, as all previous settlements between Defendant and Plaintiff’s counsel have ultimately been completed.

Furthermore, Defendant maintains that judgment cannot be entered because its CCP § 998 offer does not provide for or contemplate judgment, but rather calls for payment, vehicle surrender, and dismissal with prejudice. Defendant argues that entering judgment would contradict the terms of the agreement and that Plaintiff has other recourse options aside from seeking judgment.

Defendant disputes Plaintiff’s claim for prejudgment interest, asserting that the settlement amount is not “damages” under Civil Code § 3287(a) but rather an agreed-upon resolution without any admission of liability. Defendant also notes that prejudgment interest is generally not awarded in Song-Beverly Act cases due to the uncertain nature of damages. For these reasons, Defendant requests that the Court deny Plaintiff’s motion for judgment and interest, emphasizing that the settlement will be finalized soon.

In reply, Plaintiff argues that Defendant’s opposition should not be considered because it was untimely filed. Even if the Court considers the opposition, Plaintiff contends that Defendant’s arguments lack merit. Defendant agreed in its CCP § 998 settlement offer to pay Plaintiff $60,000 and accept the return of the vehicle within 60 days of acceptance, which meant compliance was required by August 25, 2024. Plaintiff fulfilled all obligations, but Defendant failed to do so. Plaintiff dismisses Defendant’s claim that the settlement is “nearly” complete as irrelevant—Defendant admits that it has not yet completed its obligations, which is the basis for this motion. Plaintiff argues that Defendant’s excuses for noncompliance are entirely of its own making. The claim that logistical challenges arise due to the high volume of settlements is unconvincing, as Defendant is well aware of its own caseload and should have planned accordingly. Additionally, Defendant’s reliance on Sedgwick as a third-party surrender agent is no excuse, as Defendant chose this company and could have ensured it had the resources to complete the settlement on time. Defendant’s claim that end-of-year closures contributed to delays is also baseless because the deadline for compliance was in August 2024—months before the holiday season.

Plaintiff further argues that judgment must be entered because Defendant failed to fulfill its obligations. Under CCP § 998, an accepted offer is enforceable as a stipulation for judgment. (Glende Motor Co. v. Superior (1994) 159 Cal.App.3d 389, 394-395; see On-Line Power, Inc. v. Mazur (2007) 149 Cal.App.4th 1079, 1085 [holding that an offer that includes dismissal with prejudice is “tantamount” to a judgment].) Plaintiff states Defendant’s argument that entry of judgment is unnecessary because it may eventually comply is insufficient. Since Defendant failed to meet its obligations by August 25, 2024, and has provided no concrete timeline for full performance, Plaintiff requires a judgment entry to take legal action and enforce compliance.

Lastly, Plaintiff requests prejudgment interest of $2,581.08, calculated at $16.44 per day from August 25, 2024, to January 29, 2025.

            The Court finds that Defendant failed to comply with its obligations under the Settlement Agreement, which required performance by August 25, 2024. Plaintiff provided all necessary information and documents by July 8, 2024, and repeatedly inquired about Defendant’s compliance, receiving no response. Defendant admits that it has not yet completed its obligations, offering only excuses for its delays. The Court finds that Defendant’s arguments regarding logistical challenges and reliance on a third-party surrender agent are unpersuasive, as the Defendant had full control over its compliance timeline and should have planned accordingly.

Furthermore, under Code of Civil Procedure § 998, an accepted settlement offer is enforceable as a stipulation for judgment. Defendant’s claim that judgment entry is improper because the offer contemplated dismissal with prejudice is without merit. Courts have recognized that a settlement agreement structured under § 998 is tantamount to a judgment, especially when one party fails to perform as agreed. Given that Defendant has not fulfilled its obligations, judgment must be entered to allow Plaintiff to enforce the agreement through legal remedies.

Additionally, the Court finds that Plaintiff is entitled to prejudgment interest under Civil Code § 3287(a), as Defendant was obligated to pay a specific sum by a certain date and was not legally prevented from doing so. The total prejudgment interest, calculated at $16.44 per day from August 25, 2024, to January 29, 2025, amounts to $2,581.08, which Plaintiff is entitled to recover.

Conclusion

Based on the foregoing, Plaintiff’s motion to enforce settlement agreement is granted. The Court will enter judgment in favor of Plaintiff in the amount of $60,000, plus $2,581.08 in prejudgment interest. Plaintiff is ordered to file and serve the proposed judgment within 10 days of the date of this Order, with a courtesy copy delivered to Dept. 50.

Plaintiff is ordered to provide notice of this Order. 

DATED:  March 7, 2025                               

________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court