Ferras v. Morrison Homes

Filed 10/29/09 Ferras v. Morrison Homes CA1/4

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIRST APPELLATE DISTRICT

DIVISION FOUR

Anthony M. Ferras appeals, in propria persona, from an order denying his motion to set aside a settlement agreement and dismissal of action. We dismiss the appeal.

I. BACKGROUND

In 2003 appellant purchased a home in Brentwood from respondent Morrison Homes Inc., the predecessor of Taylor Morrison LLC (hereafter Taylor Morrison). Proceeding in propria persona, he filed suit against Taylor Morrison on May 8, 2007, alleging general negligence and property damage arising from construction of the home. The matter proceeded to trial on May 13, 2008.[1] The trial court granted a recess to enable appellant to obtain counsel, which he did. On May 20, Tasos Geron was substituted as attorney of record for appellant and trial was set for September 29 with a settlement conference scheduled for June 20.

The settlement conference took place in the chambers of Judge Barbara Zuniga. Appellant and his attorney were present, as well as Mary Acquesta, who appeared for Taylor Morrison as its attorney of record.

Pursuant to the settlement agreement, Taylor Morrison agreed to pay $15,000 to the client trust fund of appellants attorney by July 20; the action was to be dismissed with prejudice; and appellant agreed to drop his pending claim with the Contractors State License Board (CSLB) by notifying the investigator in writing by June 30. Finally, the agreement recited: This release and settlement was entered into following negotiations between the attorneys for the undersigned and the parties herein released at a Judicially supervised settlement conference on [June 20, 2008] before the Honorable Barbara Zuniga, and is enforceable pursuant to CCP Section 664.6.^[[2]]

Judge Zuniga offered her computer to reduce the agreement to writing as soon as negotiations ended. Appellant and his attorney signed and dated the agreement; Acquesta signed for Morrison Homes Inc. and also signed again with the firms title.

On July 3, 2008, Taylor Morrison issued a $15,000 check to appellants attorney, in trust for him. The check was received in Acquestas office around July 8. Acquesta notified Geron by letter of July 10 that the funds were in her office, but they would not be sent until receipt of (1) notification that appellant had dismissed the CSLB claim as well as (2) a signed dismissal.

On July 18, Acquesta received the original request for dismissal from Geron, with a letter stating the dismissal could not be filed until his office received the draft and the funds had cleared. Although as of July 21 Taylor Morrison still had not received written confirmation that the CSLB claim was closed, the company authorized Acquesta to transmit the settlement funds, which she did, via certified mail on July 22. The next day Taylor Morrison learned that the CSLB would be closing the complaint file. Delivery of the check was attempted on July 25, but no one was available to accept delivery; Geron went out of town that day. Acquestas office received an e-mail from Geron on July 31 stating that the dismissal could be filed and he would pick up the check on Saturday. After receiving a responding e-mail confirmation, Geron reiterated, Please file the dismissal. The dismissal was filed on August 1; settlement funds were received on August 2.

Despite this apparent closure, Geron wrote to Acquesta on August 11, stating he was in receipt of the settlement draft but his client wished to file a motion to set aside the settlement agreement and dismissal on grounds that her signature on the agreement was insufficienta principal of Taylor Morrison should have signed. Taylor Morrison replied that the cases Geron cited were not on point and the proposed motion was frivolous.

Appellant filed the motion to set aside on September 18, and served Taylor Morrison on September 26. He asserted that Taylor Morrisons attorney of record was not a party and thus lacked the capacity to execute the agreement, this situation constituted a surprise under section 473, and Taylor Morrison failed to abide by certain terms of the agreement. Opposing the motion, Taylor Morrison submitted declarations to the effect Donald Steffensen, Taylor Morrisons general counsel, participated telephonically in the conference, speaking numerous times throughout the proceeding with Acquesta. He was apprised of all the terms of the settlement agreement and specifically authorized Acquesta to sign the agreement on behalf of Taylor Morrison. Acquesta apprised the court and Geron that she had authority to bind Taylor Morrison, as provided by Steffensen. At the time, neither appellant nor his attorney objected to Steffensens delegation of authority to Acquesta.

Appellant filed a reply by fax disputing Taylor Morrisons showing that Acquesta had authority to sign for the client, but the trial court did not consider the reply because it was late.

On November 4, the court issued a tentative ruling denying the motion; neither party opposed it or appeared to contest the ruling. Denying the motion on November 5, the court ruled, among other points, that (1) the agreement was clear that the complaint with the CSLB was to be dismissed by June 10, but it was not; (2) settlement funds were issued in a timely fashion, and Acquesta informed Geron they were available pending notification that the CSLB claim had been dismissed and receipt of an executed dismissal; (3) in authorizing the dismissal on August 1, Geron did not complain that the settlement agreement had been breached because funds were not received by July 20; (4) appellants complaint that defense counsel lacked the capacity to sign was disingenuous because Taylor Morrison was not trying to back out of the agreement and the cases interpreting section 664.6 addressed a courts inability to enforce an agreement against a nonsignatory; and (5) had trial continued without the courts continuance to allow appellant to retain counsel, it was highly unlikely that appellant would have prevailed on any claim and thus settlement was more than fair.

On December 12, Acquestas office served notice of entry of the order denying the motion. The $15,000 payable to Geron in trust for appellant was endorsed by appellant and cashed on December 10.

Upon receiving appellants notice of appeal, Acquesta alerted appellant, who was proceeding in propria persona, that she knew the settlement check had been cashed and a continuation of the appeal would be frivolous, subjecting appellant to sanctions. Nonetheless appellant proceeded, continuing to insist that the settlement agreement was not binding because it was not signed by both litigants; question[ing] Steffensens declaration and involvement; pointing out an improper date referenced in the settlement agreement; and, for the first time on appeal, contending he felt pressured into accepting the agreement because his attorney yelled into his face. Appellant also for the first time assaults his attorneys representation, another matter not before us.

II. DISCUSSION

Taylor Morrison has filed one motion to dismiss the appeal and two motions for sanctions on appeal. The companys theory of dismissal is based on the fact that appellant accepted the benefits of the settlement in the form of the $15,000 settlement check, thus waiving his right to appeal. We agree.

As an initial matter we note that here, unlike the factual situations in cases[3] cited by appellant, there was uncontroverted evidence[4] that Taylor Morrison had knowledge of the settlement, specifically consented to its terms, and specifically authorized Acquesta to settle the claim. In Levy, at the same time the court construed the term party to refer narrowly to the person against whom legal proceedings are brought, and emphasizing that settlement is such a serious step [requiring] the clients knowledge and express consent, it further explained: [T]he law is well settled that an attorney must be specifically authorized to settle and compromise a claim, that merely on the basis of his employment he has no implied or ostensible authority to bind his client to a compromise settlement of pending litigation. . . . [Citation.] (Id. at p. 583, italics added.)

Specifically, Taylor Morrisons evidence showed that Steffensen of Taylor Morrison, the defending litigant, participated in the settlement conference telephonically, spoke numerous times with Acquesta throughout the settlement process, was apprised of all negotiations, and specifically granted Acquesta settlement authority and authorized her to sign the agreement on behalf of Taylor Morrison. With Steffensens specific authorization to bind Taylor Morrison, Acquesta signed for the company and as a member of her firm. Although Judge Zuniga did not make a specific finding that Acquesta was authorized to sign the agreement, as stated above, Taylor Morrisons evidence was uncontroverted for purposes of her ruling.

Moreover, assuming for purposes of argument that Acquestas authority to sign and settle was not adequate, it is also apparent that her client, Taylor Morrison, ratified her actions. The law is settled that a client may ratify unauthorized actions of his or her attorney, including an unauthorized settlement. (Navrides v. Zurich Ins. Co. (1971) 5 Cal.3d 698, 703.) In this case, Taylor Morrison ratified the settlement agreement by issuing the $15,000 settlement check which was transferred to appellants attorney; dismissing its cross-complaint; and receiving the benefits of the dismissal of the CSLB claim and of the entire action.

Turning to the merits of Taylor Morrisons premise that the appeal should be dismissed, we find Epstein v. DeDomenico (1990) 224 Cal.App.3d 1243 (Epstein) persuasive. There, the parties participated in a court-supervised settlement conference resulting in settlement of the case. The plaintiffs became dissatisfied with the settlement and the wife claimed she only agreed to it because her attorney threatened to abandon the matter. The defendant moved to enforce the settlement under section 664.6 and the trial court entered judgment enforcing its terms. The reviewing court dismissed the plaintiffs appeal. The settlement agreement specifically called for the return of the plaintiffs security deposit and prior to objecting to the settlement, the plaintiffs obtained an order returning that deposit, thereby preventing foreclosure of their property. The voluntary acceptance of the benefit of a judgment or order bars prosecution of an appeal therefrom. (Id. at p. 1246.) Where an appellant has received and accepted advantages from a judgment to which he or she would not be entitled if the judgment were reversed, acceptance of even part of the judgment generally precludes an appeal. This is because the right to accept the fruits of a judgment and the right to appeal from it are totally inconsistent, such that election to pursue one renounces the other. (Ibid.)

The Epstein court further held: [A] settlement subject to enforcement under section 664.6 is equivalent to judgment entered on the authority of that section. A motion to enforce seeks entry of a judgment on terms identical to those of the settlement. [Citation.] Thus, because the judgment does no more than put into effect the determination of the rights and duties made by the settlement, an acceptance of the benefits of the settlement before entry of the enforcing judgment should waive the right to appeal from the judgment, absent some exception to the general rule. (Epstein, supra, 224 Cal.App.3d at pp. 1247-1248.)

The procedural posture here is somewhat different than that in Epstein. Taylor Morrison did not move to enforce the settlement because there was no need to do soall the terms of the settlement agreement had been executed: dismissal of the action, dismissal of the CSLB complaint, and payment in trust to appellants attorney of the $15,000. However, appellant sought to set aside the dismissal and the settlement agreement. The trial court denied the motion and thereafter, prior to lodging this appeal from the order denying his motion to set aside, appellant cashed the settlement check.

The order denying the motion to set aside was the functional equivalent of an order or judgment enforcing a settlement agreement: By maintaining the integrity of the settlement agreement and dismissal, the order ensured that the rights and dutiesset forth in the settlement and already put into effectwere preserved. By accepting the $15,000 benefit of the settlement, appellant acted in a manner wholly inconsistent with the right to appeal. Were we to reverse the order, thereby setting aside the dismissal and settlement agreement, appellant would not be entitled to the $15,000.

III. DISPOSITION

Because appellant accepted the benefit of the settlement, he is precluded from appealing the order preserving the settlement and accordingly we dismiss the appeal. Appellant to pay costs. The motions for sanctions are denied. Appellants requests for judicial notice are denied.

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Reardon, J.

We concur:

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Ruvolo, P.J.

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Sepulveda, J.

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[1] Unless otherwise noted, all references to dates are to the year 2008.

[2] Code of Civil Procedure section 664.6 (section 664.6) reads in part: 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.

All further statutory references are to the Code of Civil Procedure.

[3] See for example, Levy v. Superior Court (1995) 10 Cal.4th 578, 586 (Levy) (term parties as used in section 664.6 means litigants themselves, and does not include attorneys of record) and Harris v. Rudin, Richman & Appel (1999) 74 Cal.App.4th 299, 305-306 (signature requirement of section 664.6 is not limited to party to be charged ).

[4] The evidence is uncontroverted because the trial court did not consider Gerons late reply.