Judge Walter P. Schwarm, Case 30-2019-01099597 2023-08-22 Tentative Ruling

Judge: Walter P. Schwarm, Case: 30-2019-01099597, Date: 2023-08-22 Tentative Ruling

Plaintiff’s (Maxim Flexpac, Inc.) unopposed Motion to Set Aside Dismissal of the Action, to Enforce the Settlement Agreement, and to Enter the Stipulated Judgment upon Default (Motion), filed on 3-27-23 under ROA No. 112, is GRANTED.

Code of Civil Procedure section 664.6 states, “(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.”

Mesa RHF Partners, L.P. v. City of Los Angeles, (2019) 33 Cal.App.5th 913, 917 (Mesa), provides, “A request for the trial court to retain jurisdiction under section 664.6 ‘must conform to the same three requirements which the Legislature and the courts have deemed necessary for section 664.6 enforcement of the settlement itself: the request must be made (1) during the pendency of the case, not after the case has been dismissed in its entirety, (2) by the parties themselves, and (3) either in a writing signed by the parties or orally before the court.’ [Citation]”

Machado v. Myers (2019) 39 Cal.App.5th 779, 792 (Machado), provides, “ ‘[T]he trial court is under a duty to render a judgment that is in exact conformity with an agreement or stipulation of the parties. “If interpretation of a stipulation is in order the rules applied are those applied to the interpretation of contracts. [Citations.] It is not the province of the court to add to the provisions thereof [citations]; to insert a term not found therein [citations]; or to make a new stipulation for the parties.” ’ [Citations.]” Hines v. Lukes (2008) 167 Cal.App.4th 1174, 1182-1183 (Hines), explains, “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. [Citations.] The court ruling on the motion may consider the parties' declarations and other evidence in deciding what terms the parties agreed to, and the court's factual findings in this regard are reviewed under the substantial evidence standard. [Citations.] If 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. [Citation.] The statute expressly provides for the court to ‘enter judgment pursuant to the terms of the settlement.’ [Citation.]” (Footnote 6 omitted.)

Plaintiff. provides the Settlement Agreement entered into by the parties. (Schindler Decl. ¶ 3 and Exhibit B.) The parties signed the Settlement Agreement, the “Stipulation for Entry of Judgment upon Default” (attached as Exhibit 1 to the Settlement Agreement), and the “Stipulation for Dismissal CCP under §664.6” (attached as Exhibit 2 to the Settlement Agreement). (Schindler Decl. ¶ 3 and Exhibit B (section 4.2 of the Settlement Agreement.) The “Stipulation for Entry of Dismissal Under CCP §664.6” (attached as Exhibit 2 to the Settlement Agreement) states in part, “The Court shall dismiss the entire action without prejudice under CCP § 664.6, and the Parties request that the Court retain jurisdiction over the Parties to set aside the dismissal and enforce the Agreement . . . .” (Schindler Decl. ¶ 3 and Exhibit B (section 4.2 of the Settlement Agreement.).) The parties executed the Settlement Agreement on 4-9-22, 4-12-22, 4-14-22, and 4-12-22. (Schindler Decl. ¶ 3 and Exhibit B.) The parties executed the “Stipulation for Entry of Judgment upon Default” on 4-12-22 and 4-14-22. (Schindler Decl., ¶ 3 and Exhibit B.) The parties executed the “Stipulation for Entry of Dismissal Under CCP §664.6” on 4-9-22 and 4-12-22. (Schindler Decl., ¶ 3 and Exhibit B.) On 5-10-22, the court dismissed the action without prejudice, and retained jurisdiction to enforce the judgment. (Schindler Dec., ¶ 4, and Exhibit C.) Thus, Plaintiff has sufficiently demonstrated that the court retained jurisdiction under Code of Civil Procedure section 664.6.

Section 4.7 of the Settlement Agreement states in part, “Within 5 business days of receipt by Maxim . . . counsel for Maxim must file and serve the Stipulation for Dismissal Under CCP §664.6, and Order, dismissing the entire Action without prejudice, with the Court reserving its power to set aside the dismissal to enforce the Agreement. . . .” Section 4.4.2 of the Settlement Agreement states, “For the purposes of this Agreement, ‘default’ means the failure to deliver any scheduled payment under Section 4.3 within ten (10) days of its due date.” (Schindler Decl., ¶ 3 and Exhibit B.) Section 4.4.3 of the Settlement Agreement states in part, “In the event there is a default, and Maxim files the Stipulation for

Judgment Upon Default, and Judgment pursuant to Section 4.4.1 above, the Parties each consent and agree that the principal amount due and owing to Maxim is the principal Settlement Sum of two hundred eighty thousand four hundred twenty dollars ($280,420.00), less any amounts paid under Section 4.3 above, plus simple interest assessed at the maximum rate allowed by California law from the date of the initial breach of the Promissory Note and Personal Guarantee on March 31, 2016, until paid, plus reasonable attorney's fees and costs incurred by Maxim in preparing, filing, and entering the Stipulation for Entry Judgment Upon Default, and Judgment, and in efforts to collect on the Judgment until paid in full.” (Schindler Decl., ¶ 3 and Exhibit B (Underscore in Settlement Agreement.).)

Plaintiff provides evidence that Defendant—Sean T. McElligott paid his first and second installment payments more than ten days late (Traynor Decl., ¶¶ 17-20.) Plaintiff further provides evidence that Defendant has failed to pay the third installment that was due on 1-2-23. (Traynor Decl., ¶¶ 21-22.)

Pursuant to Section 4.4.3, the amount of the Judgment is $455,108.00. This includes $260,390.00, which is the amount due according to the Settlement Agreement less the payments, and $ 192,618.00 which is legal interest of 10% from the date of the initial breach of the Promissory Note and Personal Guarantee on March 31, 2016, and $2,100.00 in attorney fees. (Schindler Decl., ¶¶ 5- 6.)

Based on paragraphs 2.8.3, 2.8.4, 2.8.5, 2.8.6, 2.8.7, 2.8.8, and 2.8.9, of the “Stipulation for Entry of Judgment Upon Default (Schindler Decl., ¶ 3 and Exhibit B), the court has the authority to enter judgment in the amount of $453,008.00 plus $2,100.00 in attorney’s fees.

Based on the foregoing, the GRANTS Plaintiff’s (Maxim Flexpac, Inc.) unopposed Motion to Set Aside Dismissal of the Action, to Enforce the Settlement Agreement, and to Enter the Stipulated Judgment upon Default (Motion), filed on 3-27-23 under ROA No. 112. The court vacates the dismissal entered on 5-10-22 and enters Judgement against Defendant Sean T. McElligott in the amount of $455,108.00.

Plaintiff is to give notice.