Estate of Kahn

Filed 12/22/09 Estate of Kahn CA1/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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 ONE

Eugene Schneider (Schneider) appeals from an order approving and enforcing a settlement agreement pursuant to Code of Civil Procedure section 664.6.[1] Schneider was a former attorney for James Kahn (Kahn), the administrator of the estate of decedent Henry Kahn (decedent). Schneider contends the settlement is not enforceable because (a) one of the beneficiaries of the estate, Sari Pierre, was not personally present when the settlement was placed on the record in open court and allegedly later repudiated it and (b) he did not consent to a subsequently prepared written settlement agreement. We affirm.

I.       Factual and Procedural Background

Letters of administration for decedents estate were issued in February 2002, and administration extended over a number of years. The petition for final distribution and accounting was finally set for hearing on July16, 2008. Schneider and several other attorneys who provided services to the administrator submitted fee petitions.

All parties, except Sari Pierre, and counsel for all parties (including for Pierre), were present in court at the July 16 hearing. Although Pierre was not personally present, three attorneys appeared for her in her capacity as a beneficiary and as a former co-administrator of the estate. The current attorney for Kahn, Kevin Ford, advised the court the parties had reached a settlement and wanted to place the material terms on the record pursuant to section 664.6. Ford placed the following on the record: Mark Rubke, former litigation counsel for the estate, would receive $10,000 in cash. Schneider would receive $23,700. Henry Poy, Albert Lee and Mark Cederborg, the three attorneys for Pierre, would receive $28,300. Ford specified additional terms regarding an exchange of the decedents personal property between the beneficiaries, Kahn and Pierre, and a cash payment to Pierre. The balance of the estate was to be distributed as currently configured to the heirs. The parties would provide mutual releases of all claims. Counsel for Pierre and all other parties, including Schneider, stipulated to the stated terms.

Ford reduced the terms of the settlement to writing and circulated the document. Schneider and all other parties, except Pierre, signed it. Pierre questioned whether it accurately set forth the agreed-to terms of the settlement. Ford revised the document to track specific words in the reporters transcript regarding the exchange of the decedents personal property between Kahn and Pierre. Pierre still refused to sign.

At a hearing on October 21, 2008, Ford told the court the parties had been unable to resolve the language of the settlement agreement and Pierre had not yet signed it. Counsel for Pierre then stated his view Pierre was not bound by the settlement because she had not been present in court when the parties placed it on the record and she had not signed the written agreement. At this point, the court stated the parties were going beyond what we should do next and were arguing the case. The court was not ready for that. Counsel for Pierre suggested the parties should retire to the hallway to see if we can reach some type of solution. Kahn was not present, but his counsel agreed. The court observed such effort might produce an agreement that might be substantially whats before us today and set the matter for hearing on a motion to enforce the settlement. The court specifically stated it was not setting the case for trial.

Further discussion proved fruitful, and Pierres objections were resolved before the next hearing date. Ford prepared another written agreement, which all parties, except Schneider, signed.

Apparently, Schneider was now dissatisfied with the amount of fees to which he had agreed, and at the next hearing, on December 4, 2008, he objected, alone, to enforcement of the settlement. He argued it was unenforceable because Pierre was not present at the July 16 hearing when the terms were placed on the record and she repudiated the settlement at the October 21 hearing, at which time the court set the matter for trial.

Both counsel for Pierre and the court rejected Schneiders view of events. Counsel for Pierre flatly stated the settlement agreement was not repudiated and explained the beneficiaries had been able to resolve Pierres concern. The court stated, in turn, that the matter had not been set for trial. Like Pierres lawyer, the trial court spoke in terms of Pierre simply making a clarification of the written agreement. The court thereupon approved the settlement agreement and ordered enforcement.

II. Analysis

Prior to the enactment of section 664.6, a party seeking to enforce a settlement agreement had to file a new action alleging breach of contract and seeking either contract damages or specific performance of the settlement terms, or alternatively had to supplement the pleadings in a pending case. [Citations.] Although a summary judgment motion could be filed based on the newly pleaded contract or specific performance claim, summary judgment could be granted only if the opposing party failed to raise a triable issue of fact. [Citation.] Expeditious enforcement of a settlement agreement was therefore not always possible. (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 809.)

Section 664.6 created a summary expedited procedure to enforce settlement agreements when certain requirements that decrease the likelihood of misunderstandings are met. Thus the statute requires the parties to stipulate in writing or orally before the court that they have settled the case. The litigants direct participation tends to ensure that the settlement is the result of their mature reflection and deliberate assent. This protects the parties against hasty and improvident settlement agreements by impressing upon them the seriousness and finality of the decision to settle, and minimizes the possibility of conflicting interpretations of the settlement. . . . It also protects parties from impairment of their substantial rights without their knowledge and consent. (Levy v. Superior Court (1995) 10 Cal.4th 578, 583-585, citations & fn. omitted (Levy).)

When enforcing a settlement agreement under section 664.6, the trial court has the authority to resolve factual disputes relating to the agreement, to interpret the terms of the settlement, and to incorporate the terms of the settlement into a judgment. (Osumi v. Sutton (2007) 151 Cal.App.4th 1355, 13591360; Weddington Productions, Inc. v. Flick, supra, 60 Cal.App.4th at p. 810.) Factual determinations made by a trial court on a section 664.6 motion to enforce a settlement must be affirmed if the trial courts factual findings are supported by substantial evidence. [Citation.] Other rulings are reviewed de novo for errors of law. (Weddington Productions, Inc. v. Flick, supra, at p. 815.)

Schneider does not dispute he was present on July 16, 2008, when the parties put the settlement agreement on the record. Nor does he dispute he agreed on the record to its terms and specifically to the amount he would receive in attorneys fees. He nonetheless seeks to avoid enforcement of the terms pertaining to him and to which he expressly agreed because Pierre was not personally present on that date and, instead, was represented by three different lawyers. He asserts the settlement agreement is not enforceable because Pierre purportedly repudiated the oral settlement at the October 21, 2008, hearing and, although she subsequently signed the revised written agreement,he did not.

Pursuant to section 664.6, the parties may enter into a binding oral settlement agreement by placing the terms of their agreement on the record before a judge. The term parties as used in section 664.6 . . . means the litigants themselves, and does not include their attorneys of record. (Levy, supra, 10 Cal.4th at p. 586.) Since Pierre was not personally present when all the other parties placed the agreement on the record, the agreement could not be enforced pursuant to the expedited procedure of section 664.6, if she, in fact, repudiated it.

Although Schneider insists Pierre repudiated the settlement at the October 21 hearing, the trial court concluded otherwise, and the record amply supports the courts conclusion. At the December 4 hearing, Pierres own lawyer unequivocally stated the settlement had not been repudiated. At the October 21 hearing, he had threatened the settlement would be unenforceable if she did not sign the written agreement, but then suggested the parties try once more to resolve her concerns. They were able to do so, and Pierre signed the revised document. The trial court clearly did not view Pierre as repudiating the agreement at the October 21 hearing because it explicitly did not set the matter for trial, but instead set it for hearing on the motion to enforce the settlement. And at the December 4 hearing, the trial court took the same view as Pierres lawyer, namely that the written settlement agreement had been clarified to resolve the last of Pierres concerns.

Since Pierre did not repudiate the settlement and ultimately signed a written agreement memorializing its terms, the agreement is enforceable against Schneider pursuant to section 664.6. (Elyaoudayan v. Hoffman (2003) 104 Cal.App.4th 1421 (Elyaoudayan).) In multiparty litigation, an oral settlement agreement is enforceable against a party who is present and orally agrees to the terms, even if another party is not present, but subsequently agrees in writing. (Id. at pp. 1424, 1431-1432.) The facts in Elyaoudayan are remarkably similar to the facts at hand. In Elyaoudayan, only one of the parties, Elyaoudayan, was present in court and on the record agreed to the terms of the settlement. The remaining parties, the Hoffmans, signed the subsequently prepared written settlement agreement. Elyaoudayan, however, had a change of heart and refused to sign the written agreement. (Id. at p. 1426.) The trial court denied Elyaoudayans motion to set aside the settlement, and granted the Hoffmans motion to enforce it. (Id. at p. 1427.)

The Court of Appeal affirmed. The court held it is not necessary under section 664.6 for all parties to agree to a settlement in the same way. In other words, a  mix and match approach to the manner of agreement, is permissible as long as all parties agree to the same material terms. (Elyaoudayan, supra, 104 Cal. App.4th at pp. 1431-1432.) Thus, the settlement was enforceable despite the Hoffmans absence from court the day the other parties orally agreed on the record, because the Hoffmans signed the written settlement agreement. The court further held Elyaoudayans refusal to sign the written agreement didnot render the settlement unenforceable. Having orally agreed to settlement terms before the court, parties may not escape their obligations by refusing to sign a written agreement that conforms to the oral terms. (Id. at p. 1431.)

Similarly, here, Pierres absence from court when Schneider and the other parties orally agreed to the settlement does not render it unenforceable pursuant to section 664.6, since she ultimately signed the written settlement agreement. Absent some showing the written agreement materially changed the terms to which Schneider orally agreed, his failure to sign the agreement is immaterial. Both the oral agreement and written agreement provide for payment to him of exactly the same amount of attorneys fees. Indeed, Schneider never raised in the trial court any material variance between the settlement as stated on the record and as ultimately put in writing. It is too late to advance any such argument now. Moreover, we discern no such variance.[2] In short, Schneider may not escape . . . [his] . . . obligations by refusing to sign a written agreement that conforms to the oral terms. (Elyaoudayan, supra, 104 Cal.App.4th at p. 1431.)

III. Disposition

The order enforcing the settlement agreement is affirmed.

_________________________

Banke, J.

We concur:

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Marchiano, P. J.

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Dondero, J.

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[1] All further statutory references are to the Code of Civil Procedure unless otherwise indicated.

[2] The revised written agreement adjusted the cash payment to Pierre, from the $12,000 stated orally at the July hearing, to $10,000. This was apparently in response to an ambiguity in the wording of the oral agreement that Pierre claimed incorrectly imposed upon her a mandatory duty to turn over certain property. We do not consider this a material change to the settlement terms.