Power Point Films v. Zenpix

Filed 10/5/06 Power Point Films v. Zenpix CA2/5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION FIVE

APPEAL from a judgment of the Superior Court of Los Angeles County. Andria K. Richey, Judge. Affirmed.

Law Offices of Roderick J. Lindblom and Roderick J. Lindblom for Plaintiff and Appellant.

Wolf, Rifkin, Shapiro & Schulman, LLP, Roy G. Rifkin and Ryan P. Eskin for Defendants and Respondents.

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This is an appeal from a trial court order vacating a judgment. Finding no error, we affirm.

Facts

In November 2003, appellants Power Point Films, Gabriela Partners, Gabriela Distribution Partners, Vincent Francillon, and Vincent Miller sued respondents Susan Jackson and Turtles Crossing LLC and others, on factual allegations about a licensing agreement for a film called "Gabriela." Causes of action included breach of contract, negligence, and fraud. In April 2004, all causes of action brought by plaintiffs Gabriela Partners, Gabriela Distribution Partners, Vincent Francillon, and Vincent Miller were dismissed, after defendants' demurrers to those causes of action was sustained without leave to amend.

In January 2005, the case settled. The Settlement Agreement defined Power Point and the other plaintiffs as "the Gabriela Parties," and respondents and two other defendants, Zenpix, Inc., and Promark Entertainment Group as "the Zenpix Parties," and provided, inter alia, that "Promark shall pay to the Gabriela Parties the sum of $152,924.98 (the 'Settlement Sum.') This Agreement requires the Zenpix Parties to comply with the terms and conditions contained in this paragraph. . . . In addition to the above consideration, the parties further agree as follows: (a) Promark will pay Gabriela Parties $24,000 in foreign sales revenue on or before January 30, 2005. . . . "

The Settlement Agreement also provided that "the Superior Court of the County of Los Angeles, State of California, the Honorable Andria K. Richey, shall retain jurisdiction over this dispute pursuant to California Code of Civil Procedure section 664.6 for purposes of enforcing this Agreement."

Under the terms of the Settlement Agreement, payments were to be made by January 30, 2005. No payment was made, and in February 2005, appellants moved for judgment pursuant to the Settlement Agreement under Code of Civil Procedure section 664.6.[1] The stated ground was that "the Zenpix parties have defaulted in their payment obligations under said Settlement Agreement . . . ."

The motion was made ex parte. It is dated February 8, and accompanied by the declaration of counsel for appellants that on February 8 he left a voice mail message for counsel for respondents saying that an application "for entry of judgment pursuant to the Settlement Agreement" would be heard on February 9 in Judge Richey's courtroom. The matter was continued, and a February 10 declaration of counsel for appellants states that on that date he informed counsel for respondents that the application "for entry of judgment pursuant to the Settlement Agreement" would be heard on February 14.

Counsel for respondents did not attend the hearing, believing (according to his later declaration) that the Settlement Agreement provided only that Promark pay the specified parties, so that a judgment "pursuant to the Settlement Agreement" would have no effect on his clients.

The judgment prepared by appellants provides: "(1) Plaintiffs take Judgment against the ZenPix Parties, and each of them, in the principal sum of $152,924.98, plus pre-judgment interest . . . ; (2) Plaintiffs take Judgment against Promark in the principal sum of $24,000, plus prejudgment interest . . . ." All plaintiffs, even those whose causes of acting had been dismissed, are named in the caption.

This judgment was not served on respondents prior to the hearing.

On February 14, Judge Richey's courtroom was dark. The motion was heard by Judge Kalin, who, noting the lack of opposition, granted the motion and signed the judgment submitted to him.

On May 25, after PowerPoint served a writ of execution on respondents' bank accounts, respondents moved ex parte for an order correcting the judgment nunc pro tunc and vacating the judgment, based on the court's inherent power to correct clerical errors or misprisions in the record, citing Ames v. Paley (2001) 89 Cal.App.4th 668. Respondents asked that the judgment be corrected by deleting the dismissed plaintiffs, and that the judgment be vacated as to themselves. They argued that under the Settlement Agreement, only Promark was responsible for paying the specified sums.

In an accompanying declaration, counsel for respondents declared that in the settlement negotiations, the parties agreed that if Promark failed to pay, PowerPoint's recourse would be to obtain judgment against Promark. To that end, the parties had prepared a stipulated judgment between PowerPoint and Promark, reciting that if Promark failed to comply with the Agreement, judgment could be rendered against it. A copy of the stipulated judgment (unsigned) was attached.

Counsel further declared that the telephone notice of PowerPoint's ex parte application had only indicated that PowerPoint sought to have judgment entered pursuant to the Settlement Agreement. Because the Settlement Agreement did not put any obligation on respondents, counsel did not oppose the motion.

At oral argument, Judge Richey asked the parties to focus on the meaning of the Settlement Agreement. PowerPoint argued that the Agreement meant that all defendants were obligated to pay, and respondents argued that despite the sentence concerning the Zenpix Parties' obligation "to comply with the terms and conditions contained in this paragraph," under standard principles of contract interpretation, only Promark was obligated to pay. The court commented on the difficulties of understanding the Agreement, then vacated the judgment, finding that the Settlement Agreement was ambiguous and noting that it did not allow for an ex parte judgment and that PowerPoint had "skirted" Code of Civil Procedure section 664.6 by moving ex parte. The court invited appellants to bring a new motion to enforce the Settlement Agreement.[2]

Discussion

Appellants begin by arguing that the court did not have jurisdiction to make the order vacating the judgment. In appellants' view, Judge Richey denied respondents' motion to vacate the judgment, but then, inexplicably, sua sponte and without an articulated basis, vacated the judgment in contravention of the rule that a trial court "has no power, however, having once made its decision after regular submission, to set aside or amend judicial errors except under appropriate statutory proceedings." (Denton v. Denton (1971) 18 Cal.App.3d 708, 714-715.)

Appellants also suggest that Judge Richey vacated the judgment because she disagreed with Judge Kalin's interpretation of the Settlement Agreement, again contending that she had no jurisdiction, citing the rule that "'A superior court is but one tribunal, even if it be composed of numerous departments. . . . An order made in one department during the progress of a cause can neither be ignored nor overlooked in another department . . . . (Sandco American, Inc. v. Notrica (1990) 216 Cal.App.3d 1495, 1508.)" (Elsea v. Saberi (1992) 4 Cal.App.4th 625, 631.)

We do not see that the court did anything sua sponte, or that it exceeded its jurisdiction. Appellant has perhaps been misled by the phrasing of the minute order, which reads "MOTION OF DEFENDANT, FOR AN ORDER CORRECTING THE JUDGMENT NUNC PRO TUNC; matter is called for hearing argued and denied by the Court. The court orders the 'judgment' filed on February 14, 2005 hereby vacated."

If the minute order is less than entirely clear, it becomes perfectly clear when it is considered in conjunction with the transcript of the proceedings and the proceedings themselves. Respondents moved to have the judgment corrected and/or vacated. The motion to correct the judgment was denied. The motion to vacate was granted, for the reasons the trial court expressed at the hearing: the Settlement Agreement did not provide for ex parte enforcement, and was moreover ambiguous and not suitable for ex parte enforcement.

Judge Richey did not (at that point) interpret or construe the Settlement Agreement and decide whether Promark alone was responsible for the payment, but instead decided that there was an issue which could not be resolved ex parte.

It is also clear that Judge Kalin did not interpret or construe the Settlement Agreement. He was presented with what looked like a non-controverted order which all parties had agreed that he could sign, without further examination or litigation. It was not such an order.

Judge Richey (or indeed any judge) had the power to correct the error. In that way, this case is very much like Ames v. Paley, supra, 89 Cal.App.4th at pp. 672-674. There, a defendant moved for judgment pursuant to a settlement agreement under Code of Civil Procedure section 664.6. The trial court granted the motion. Plaintiff later moved to fix the date of a promissory note referenced in the judgment, contending the trial court had jurisdiction to determine the commencement date of the note, and that the date the parties had intended could be discerned from the terms of the agreement. The defendant opposed the motion, pointing out that the judgment was silent with respect to the commencement date of the promissory note and the date for accrual of interest, and

contending that a different date should apply, no earlier than the date of entry of judgment. The trial court granted plaintiff's motion, and the Court of Appeal affirmed, citing the well-established principle that "'A court of general jurisdiction has the power, after final judgment, and regardless of lapse of time, to correct clerical errors or misprisions in its records, whether made by the clerk, counsel or the court itself, so that the records will conform to and speak the truth. [Citations.]' (7 Witkin, Cal. Procedure (4th ed. 1997) Judgment, § 69, p. 597.)" (Id. at p. 672.)

Ames concluded that "because the trial court intended to enter judgment pursuant to the settlement agreement, to the extent the judgment failed to conform to the terms of the settlement agreement, the trial court retained the inherent power to correct the judgment nunc pro tunc. . . ." (Ames v. Paley, supra, 89 Cal.App.4th at p. 674.)

Here, too, Judge Kalin intended to enter judgment pursuant to the terms of Settlement Agreement, and the court retained the power to make sure the judgment conformed to those terms.

"Independent of statute, a trial court has power to correct mistakes and to annul orders and judgments inadvertently or improvidently made. A trial court has power to vacate judgments and orders inadvertently made which are not actually the result of the exercise of judgment." (Denton v. Denton, supra, 18 Cal.App.3d at p. 714-715.)

That is all that happened here.

In the alternative, respondents ask us to deem their motion one under Code of Civil Procedure section 663, to set aside a judgment. That statute provides that "A judgment or decree, when based upon a decision by the court, or the special verdict of a jury, may, upon motion of the party aggrieved, be set aside and vacated by the same court, and another and different judgment entered, for either of the following causes, materially affecting the substantial rights of the party and entitling the party to a different judgment: 1. Incorrect or erroneous legal basis for the decision, not consistent with or not supported by the facts; . . ."

We agree that the statute provides an alternative ground for affirmance of the challenged order. Section 657, on motions for new trial, provides that "The verdict may be vacated and any other decision may be modified or vacated, in whole or in part, and a new or further trial granted on all or part of the issues, on the application of the party aggrieved, for any of the following causes, materially affecting the substantial rights of such party: 1. Irregularity in the proceedings of the court, jury or adverse party, or any order of the court or abuse of discretion by which either party was prevented from having a fair trial."

Our Supreme Court had held that under that statute "the superior court, in ruling on a motion for new trial, may review a prior order without violating article VI, section 4, of the California Constitution, whether the same judge reviews his or her own order or one judge reviews an order of another judge, because in ruling on the new trial motion the superior court acts under authority of Code of Civil Procedure section 657, subdivision 1." (People v. Konow (2004) 32 Cal.4th 995, 1020 [emphasis added].)

Section 663 provides similar authority. "A motion to vacate under section 663 is a remedy to be used when a trial court draws incorrect conclusions of law or renders an erroneous judgment on the basis of uncontroverted evidence." (Simac Design, Inc. v. Alciati (1979) 92 Cal.App.3d 146, 153.)

Finally, appellants argue that, even if Judge Richey had jurisdiction to vacate the judgment, she erred in so doing, because the judgment correctly reflected the terms of the Settlement Agreement, and because counsel for respondents, having had proper notice of the ex parte hearing, did not appear. As respondents point out, this amounts to an argument in support of the appeal of the June order denying relief under section 664.6, an appeal we have dismissed.

Disposition

The judgment is affirmed. Respondents to recover costs on appeal. NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

ARMSTRONG, J.

We concur:

TURNER, P. J. MOSK, J.

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Analysis and review provided by Santee Property line Lawyers.

[1] That statute provides that "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."

"In acting upon a section 664.6 motion, the trial court must determine whether the parties entered into a valid and binding settlement of all or part of the case. In making this determination, trial judges, in the sound exercise of their discretion, may receive oral testimony or may determine the motion upon declarations alone. [Citation.]" (Corkland v. Boscoe (1984) 156 Cal.App.3d 989, 994.)

[2] Appellants did so. Our record includes the motion and response, and the ruling: the court found that under the Settlement Agreement, the payment obligation was Promark's alone. Appellants filed a notice of appeal from that order, but on respondents' motion, we dismissed the appeal, finding that an order refusing to enforce a settlement agreement is not appealable. (Code Civ. Proc., § 904.1, subd.(a)(2); Doran v. Magan (1999) 76 Cal.App.4th 1287, 1293-1294.)