Rodriguez v. Packard

Filed 3/9/07 Rodriguez v. Packard CA6

NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.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

SIXTH APPELLATE DISTRICT

This case presents a tortured saga of the parties attempts to settle plaintiffs employment discrimination and wrongful termination lawsuit filed in 1999. On several occasions throughout the litigation, the parties settled the case and then disputed the terms of the agreement, which have evolved over the course of these events. As much as we would like to end this saga, we conclude that under the circumstances presented here, neither of the two orders from which plaintiff has appealed is appealable. The first order was from the trial courts denial of plaintiffs second motion to enforce the settlement under Code of Civil Procedure section 664.6[1]a clearly nonappealable order. The second order under appeal was from the trial courts grant of defendants second motion under the same section. While orders enforcing a settlement under section 664.6 are often treated as or converted to final judgments, in this particular case, the order called for further judicial action. Whats more, it did not finally adjudicate the rights of the parties for judgment purposes by ending the litigation. Accordingly, we dismiss the appeal.

BACKGROUND

Plaintiff, Mars Rodriguez, filed this action in October 1999 against her former employer, Hewlett Packard (HP), and several individual defendants who had worked with plaintiff at HP. The gravamen of the four causes of action was that plaintiff had been discriminated against in her employment and had been wrongfully terminated. Among other things, the complaint pleaded claims against defendants under the Fair Employment and Housing Act (Gov. Code, 12940 et seq.) and it sought money damages in contract and tort. The complaint was amended in June 2000 to add three new causes of action, all of which also sounded in contract and tort and related to plaintiffs alleged wrongful termination from her job culminating in 1999.

Defendant HP was not served with process until August 2000 and it answered the complaint the following month, appearing as Agilent Technologies (Agilent), a company with which it had apparently merged. At that point, the individual defendants still had not been served.

The case was referred to mediation per plaintiff and Agilents stipulation in June 2001. From Agilents perspective, through the course of a two-day mediation, the parties reached some form of agreement to entirely settle the case. At the mediation, the terms were orally agreed to and reduced to a memorandum of settlement, which was signed by plaintiffs counsel in her presence and with her express consent. Agilents counsel later prepared a formal written settlement agreement, the various terms of which were then unsuccessfully negotiated through counsel over the course of several months. In the end, plaintiff refused to sign the written agreement and in November 2001, Agilent tried to enforce it through a motionthe first of many in this caseunder section 664.6.[2] For reasons not clear from the record, the motion was taken off calendar. This was followed in February 2002 by plaintiffs counsels successful motion to withdraw as her attorney of record based on irreconcilable differences between them.

Plaintiff proceeded in pro per for some time and the trial of the action was set for October 2002. In the interim, the court had ordered plaintiff to serve the individual defendants with process. She complied with this directive and the four individual defendants filed answers to the first amended complaint on October 15, 2002. The trial date was then continued to January 2003. Plaintiff requested an early settlement conference with the court, which took place in December 2002 with the participation of a pro tem judge and plaintiffs former counsel, who by then had asserted a lien for attorney fees on any settlement proceeds.

Late in the day at the conference, the court took over managing the settlement process. The parties reached agreement and put the settlement on the record before Judge Jamie Jacobs-May. The judge went over the terms in detail with plaintiff on the record and plaintiff agreed to them. The most material aspects of the settlement were that it was to be reduced to a writing by defendants within two weeks; plaintiff would be paid $75,000 (broken down into one payment directly to plaintiff in the amount of $57,500 and one to her former attorney in the amount of $17,500) after she signed the settlement agreement; plaintiff could never again work for HP or Agilent in any capacity; within 30 to 45 days of the settlement, plaintiff would receive a performance evaluation on HP format even though HP was now Agilent; the performance review would place plaintiff in a certain employment category and she would have the chance to rebut the review in writing, with both the review and rebuttal to be placed in her HP employment file; the terms of the agreement would be kept confidential by the parties, with a $2,000 liquidated damages provision per breach of this term; plaintiff would generally release the defendants, waiving the provisions of Civil Code section 1542; each side would bear its own costs and attorney fees; the court would retain jurisdiction to interpret the agreement and to enforce the payment and the performance review issues but other issues would be subject to binding arbitration before JAMS or another neutral arbitrator in southern California.

In light of the settlement, the court took the case off the trial calendar and set it for hearing on February 6, 2003, on the dismissal review calendar, which is intended to avoid cases languishing after settlement and to carry them on calendar until settlement documents have been executed and a formal dismissal filed.

Following the oral settlement, defendants forwarded to plaintiff a written agreement that reflected their understanding of the settlement terms placed on the record. Plaintiff refused to sign the agreement and proposed multiple revisions of it, some of which were minor. Then, through a lawyer asserted to be specially appearing for plaintiff, she filed a document with the court in advance of the February 2003 dismissal review hearing date. The document expressed plaintiffs request for clarification of the terms of the settlement, asserted that the written agreement proposed by defendants contained terms not part of the settlement, contended that the term which provided that plaintiff would never again work for HP or Agilent was unconscionable as stated in the written agreement, and sought enforcement of the oral settlement under section 664.6.

In response, defendants objected to the special appearance by new counsel for plaintiff and filed their own request for court clarification and enforcement of the December 2002 judicially supervised settlement.

The February 6, 2003 dismissal review hearing was set not before Judge Jacobs-May, but instead before Judge Socrates Manoukian. At the conference, the court stated its understanding that the case had settled and indicated that if plaintiff sought enforcement of the settlement under section 664.6, that it would be necessary to continue the matter to a later law and motion hearing date. The court further noted that if plaintiff intended to pursue her request through counsel, that a substitution of attorney needed to be filed. The court set a continued hearing date and new counsel then formally substituted in as plaintiffs attorney of record.

Defendants filed a supplemental opposition to plaintiffs request to enforce the settlement in which they again asserted that the written agreement that they had proposed was fully consistent with the terms of the oral settlement of December 2002 and that plaintiffs request for clarification of the settlement was in reality an attempt to modify it. They also sought enforcement of the settlement, as reflected by both the transcript of the oral settlement and the written agreement they had subsequently prepared and forwarded to plaintiff.

The record does not indicate what became of plaintiffs then-pending request to enforce the settlement. The matter appeared to languish until a case management conference in April 2004, when the court apparently directed a special law and motion setting in May 2004 for plaintiffs motion to enforce the settlement, which she then filed, along with a request for interest on the settlement proceeds. Defendants opposed the motion and reasserted that their previously proposed written settlement agreement was consistent with the December 2002 judicially supervised settlement, which should be enforced, and that it was plaintiff who was obstructing implementation of the settlement.

At the hearing in May 2004, Judge Manoukian directed some modifications to the written agreement proposed by defendants, including those terms concerning plaintiffs agreement never to work again for HP or Agilent,[3] the payment of settlement funds to plaintiffs former attorney, and the classification of settlement proceeds as damages for emotional distress injuries for tax purposes. [I]n the interest of compromise, the court also awarded plaintiff interest on the settlement proceeds but otherwise enforced the 2002 oral settlement under section 664.6 and directed defendants to revise the written agreement they had previously proposed. The matter was again placed on the courts dismissal review calendar to be heard in November 2004.

Defendants revised the agreement as directed by Judge Manoukian and forwarded it to plaintiff in July 2004 but plaintiff still refused to sign it. For the first time, the agreement included as its final terms that plaintiff had a period of 21 days within which to decide whether to accept the Consideration as contemplated by the agreement, that plaintiff was not waiving federal claims under the Age Discrimination in Employment Act of 1967 (29 U.S.C. 621-634) that may arise after the date this Agreement is signed, and that she had a period of seven days after signing the agreement to revoke her acceptance of it. These terms were apparently inserted by defendants in an effort to render the agreement compliant with 29 United States Code section 626 (f)(1) and (2). This section of the federal Older Workers Benefit Protection Act of 1990 (29 U.S.C.  626(f)) provides minimum requirements which must be met in order to enforce a waiver or release of an employees claim under the Age Discrimination in Employment Act (29 U.S.C. 621 et seq. (ADEA).) pursuant to settlement. Thus, without these terms, defendants ability to enforce the general release of all claims as contemplated by the oral settlement might be compromised. (Oubre v. Entergy Operations, Inc. (1998) 522 U.S. 422, 428 [release not compliant with 29 U.S.C. 626(f)s stringent safeguards is unenforceable against employees ADEA claims].)

In early November 2004, plaintiff filed yet another motion, ostensibly under section 664.6, to clarify and again enforce the terms of the December 2002 oral settlementprincipally the term concerning the format of the HP performance review. Defendants opposed the motion on the basis that plaintiff was again attempting to renegotiate the settlement terms. They echoed their prior assertion that the December 2002 oral settlement, as modified by the court (Judge Manoukian) on May 25, 2004, and as reflected in the defendants July 2004 revised written settlement agreement, should be enforced. Plaintiffs motion was denied by Judge Manoukian by written order filed three months later in February 2005, the court perceiving that plaintiff was attempting to add to the terms of the settlement, which had already been finalized.[4]

Meanwhile, in November 2004, plaintiffs counsel substituted out of the case leaving her again in pro per, and the matter returned to Judge Jacobs-May in February 2005 for another settlement conference.[5] Plaintiff filed more papers seeking another court determination of the settlement terms. At the conference, the terms of the settlement agreementprincipally those concerning the format of the HP performance evaluation and the confidentiality agreementwere yet again clarified and affirmed by the court. The judge again directed the defendants to revise the latest form of the written agreement within two weeks and to forward the performance evaluation, in the agreed upon HP format, to plaintiff, who was to prepare and forward her response to the evaluation within three weeks thereafter. The court also advised defendants to file still another motion under section 664.6 if plaintiff still refused to sign the revised written settlement agreement. The matter was again placed on the dismissal review calendar for hearing in May 2005.

Per the courts directive, defendants revised the agreement again and forwarded it to plaintiff, who still refused to sign it. Defendants then filed the next motion to enforce the settlement under section 664.6. Included as part of their motion was the latest version of the written settlement agreement and the performance evaluation to which plaintiff was to respond per the terms of the agreement and the courts February 2005 directive. Plaintiff opposed the motion, which was heard by Judge Jacobs-May in June 2005. The court granted the motion by written order, which attached the most recent form of the revised written settlement agreement, as modified by the courts handwriting and interlineation to accommodate some of plaintiffs objections to it.[6] The written order provided that: Each side shall execute this settlement agreement within 20 days of notice of this order. If either side does not execute it, the court orders the clerk to execute the settlement agreement on behalf of such party. A copy of the modified settlement agreement shall be served with a copy of this order and each side shall serve the other with duplicate original[s] of the executed settlement agreement within 10 days of its execution. A party may seek to have the clerk sign by ex parte application pursuant to this order.

On June 27, 2005, plaintiff appealed from Judge Manoukians May 2, 2005 order (the second of the two identical orders) denying her second motion to enforce the settlement under section 664.6. On August 12, 2005, she appealed from Judge Jacobs-Mays order granting defendants second motion to enforce the settlement under the same section.[7]

APPEALABILITY[8]

It is clear that the first order under appealdenying plaintiffs second motion under section 664.6is not appealable.[9] (Doran v. Magan (1999) 76 Cal.App.4th 1287, 1293-1294.) The rationale behind this conclusion is that upon the denial of a motion to enforce a settlement, the action is again set at large for trial, and therefore, there is no final judgment, or order after judgment, that is appealable under section 904.1.

Whether the second order under appealgranting defendants second motion under 664.6is appealable is not quite as apparent. Section 664.6 provides for entry of judgment on the terms of a writing signed by the parties or an oral, judicially supervised settlement. A judgment so entered is appealable like any other (even though it technically has been entered by consent, a circumstance generally precluding appealability (6 Witkin, Cal. Procedure (4th ed. 1997) Proceedings Without Trial, 92 at p. 497). But as a practical matter, litigants often do not perfect a judgment in this circumstance and the trial courts final adjudication is frequently the order granting the motion to enforce a settlement. Although section 904.1 does not include orders granting a motion under section 664.6 among the list of appealable orders, case law has generally construed such orders as appealable because no issues remain for further consideration and no further judicial action is required for a final determination of the rights of the parties.[10] (Weddington, supra, 60 Cal.App.4th at p. 815.)

But here, the appealability question is not so easily dispensed with. This is because the trial courts order granting defendants motion under section 664.6 called for further judicial action to reach finality in the event that a party failed to execute the agreement. This action was the disposition of an ex parte application to be filed by one of the parties for an order directing the clerk of the court to sign the settlement agreement on behalf of another recalcitrant party.

For purposes of finality, what is even more significant here is that the agreement, consistently with federal law, provided that plaintiff has the right to revoke the entire settlement for a period of seven days after signing it. The way the agreement is written of course contemplates that plaintiff will sign the document herself, thus triggering the seven-day revocation period. But it appears that this substantive right to revoke would also apply if the clerk were to sign the document by order of the court on plaintiffs behalf. In other words, plaintiffs right to revoke the settlement agreement is not eliminated by the clerk signing the document since that act would be deemed to be on her behalf.

This leaves the question of the impact of both the need for a court order to obtain a fully executed written agreement and plaintiffs right to revoke the settlement on the finality of the order enforcing it. Were we to proceed with the process of appellate review, we would in our discretion construe the order as a judgment, as the court did in Weddington. In such cases, where an order effectively disposes of the entire action, it may be amended to convert it to a judgment, thereby allowing the reviewing court to hear an appeal. (Griset v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 700.) Whether an order may be considered a final judgment for appeal purposes comes down to whether the order finally determines the rights of the parties. The substance and effect of the judgment, and not its label, determine whether it is final and thus appealable. (Id. at p. 698.) As a general test, an order constitutes the final determination of a case where no issue is left for future consideration except the fact of compliance or noncompliance with the terms of the first decree. (Ibid.) Judgment is final   when it terminates the litigation between the parties on the merits of the case and leaves nothing to be done but to enforce by execution what has been determined.   (Sullivan v. Delta Air Lines, Inc. (1997) 15 Cal.4th 288, 304.)  [W]here anything further in the nature of judicial action on the part of the court is essential to a final determination of the rights of the parties, the decree is interlocutory  and nonappealable. (Olson v. Cory (1983) 35 Cal.3d 390, 399.)

Even though this case cries out for finality, because of the likely need for further judicial action to reach a fully executed agreement and plaintiffs seven-day right to revoke the settlement, we are reluctant to conclude that the order granting defendants motion under section 664.6 in this particular case finally disposed of the litigation. These impediments to finality are contemplated by the very terms of the order and the written agreement attached to that order. This is not a case in which all issues have been finally adjudicated and the trial court intended to render formal judgment but simply failed to do so. Accordingly, we conclude that the order is interim in nature, and therefore, not appealable.[11] Were we to conclude otherwise and treat the order as a final judgment for all purposes, plaintiff would in effect be deprived of the benefit of a material term of the agreementthe right to revoke it.

Even though we so conclude, we offer some guidance to the trial court and to the parties in the hopes that this case may finally be resolved, one way or another. Notice of the order enforcing the settlement was served by the clerk on June 17, 2005, the day the order was filed. The order directs the parties to sign the attached agreement within 20 days of such notice. If a party fails to do so, another party may seek to have the clerk sign by ex parte application pursuant to this order. Plaintiff filed her notice of appeal from the order on August 12, 2005, more than 20 days after notice of the order. Therefore, if defendants wish to enforce the settlement upon remittitur, they should immediately apply ex parte for an order directing the clerk to sign the agreement on plaintiffs behalf. The seven-day period within which plaintiff may revoke the settlement per the terms of the agreement would then begin to run upon execution of the agreement by the clerk. If plaintiff revokes the agreement in accordance with its terms, then the action is again at large and should be set for trial, subject to a motion to dismiss for plaintiffs delay in prosecution. If she does not timely or properly exercise her right to revoke, then after expiration of the revocation period, a final judgment should be entered on the terms of the settlement, as it should in every case in which a motion is granted under section 664.6.

DISPOSITION

Since neither of the orders that are the subject of this appeal is appealable, the appeal is dismissed.[12]

Duffy, J.

WE CONCUR:

Mihara, Acting, P.J.

McAdams, J.

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[1] Further unspecified statutory references are to the Code of Civil Procedure.

[2] This section 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. 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. The section thus provides for a summary procedure for specifically enforcing a settlement contract without the need for a new lawsuit or motion for summary judgment and the judge hearing the motion may enter the terms of a settlement agreement as a judgment. (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 809-810 (Weddington).) If the requirements of the section are not met, a party still has the option of a new lawsuit for specific performance or a motion for summary judgment on a supplemental pleading in the same action to enforce the settlement. (Levy v. Superior Court (1995) 10 Cal.4th 578, 586, fn. 5.)

[3] The dispute about this term concerned a possible eventuality of HP or Agilent acquiring in the future a company for which plaintiff might later be employed. The written agreement proposed by defendants called for plaintiff to resign her employment under this circumstance. Plaintiff asserted that this term was not bargained for and might require her to give up unvested pension rights.

[4] The court inexplicably again entered the exact same form of order denying the same motion on May 2, 2005. This is the first order under appeal here.

[5] It is not clear why this happened since Judge Manoukian had already once enforced the existing settlement under section 664.6, pursuant to which judgment is to be entered on the terms of the settlement. In spite of the settlement already having been so enforced, the agreement was not signed and the judgment was not formally entered. The parties and the court appear to have then proceeded as if no motion under section 664.6 had ever been granted.

[6] Notably, the modified provision concerned only the payment of plaintiffs former attorney, an issue that did not impact the terms on which plaintiff and defendants had agreed to settle plaintiffs employment claims.

[7] By order of this court, the two appeals are being processed together under one appellate case number.

[8] Plaintiff incorrectly asserted in her opening brief that this appeal was authorized under sections 904.1 and 902.1. Defendants responded in their brief that the appeal is subject to dismissal for lack of appealability, though they did not specifically move for that relief. Plaintiff reiterated in her reply brief that the orders are appealable under sections 904.1 and 902.1. Thus, the appealability issue has been sufficiently raised and briefed by the parties.

[9] There is also the question of the timing of plaintiffs notice of appeal from this order, which was entirely duplicative of a prior written order entered some three months earlier (on February 7, 2005) denying the same motion. Although the record does not show if or when notice of either order was served, plaintiffs notice of appeal filed June 27, 2005, from the May 2, 2005 order would necessarily have been timely. But if the first order denying her motion was actually the operative order as between the two, depending on whether and when notice of that order might have been served, plaintiffs notice of appeal might be untimely under Rule 8.104 of the California Rules of Court. We need not reach this timing issue because we independently conclude that neither order denying plaintiffs motion under section 664.6 is appealable in any event.

[10] On such an appeal, factual findings such as whether the parties had actually entered into a binding contract are reviewed for substantial evidence while legal issues are reviewed de novo for errors of law. (Weddington, supra, 60 Cal.App.4th at p. 815.)

[11] Defendants assert that the terms of the agreement that call for the trial court to retain jurisdiction to enforce payment and issues related to the performance evaluation also defeat appealability. But these matters relate solely to compliance with or enforcement of the settlement. Whether a judgment is being complied with is not relevant to the determination whether the judgment is final and appealable. (Public Defenders Organization v. County of Riverside (2003) 106 Cal.App.4th 1403, 1409-1414.)

[12] Because the appeal is from nonappealable orders, we have denied appellants request for oral argument and submitted the matter by separate order.