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Adams v. Newport Crest Homeowners Assn.

California Court of Appeals, Fourth District, Third Division
Sep 9, 2009
No. G039956 (Cal. Ct. App. Sep. 9, 2009)

Opinion

NOT TO BE PUBLISHED

Appeal from a judgment and orders of the Superior Court of Orange County No. 05CC05516, Daniel J. Didier and John M. Watson, Judges.

Kristine L. Adams, in pro. per., for Plaintiff and Appellant.

Grant, Genovese & Baratta, James M. Baratta, Christopher S. Dunakin and Aaron J. Mortensen, for Defendants and Respondents.


MOORE, J.

Plaintiff Kristine Adams (Adams) brought suit against Newport Crest Homeowners Association and certain others (collectively, Newport Crest), in connection with alleged mold, biological contamination, water intrusion, structural damage, termite and rat infestation, and other issues affecting her condominium unit (Present Lawsuit). The parties went to mediation and ultimately signed a settlement agreement, which entailed the payment to Adams of $500,000 from Newport Crest’s insurance carrier, and a commitment to perform extensive remediation of her unit within an anticipated 90-day period. The insurance payment was made, but Adams claimed Newport Crest failed to comply with its nonmonetary performance obligations.

Adams filed a Code of Civil Procedure section 664.6 motion to enforce the terms of the settlement agreement and to order Newport Crest to perform its obligations thereunder, and Newport Crest thereafter filed an ex parte application for an order enforcing the settlement agreement and compelling mediation. Finding that the settlement agreement required disputes thereunder to be returned to mediation, the court denied Adams’s motion and granted Newport Crest’s application. However, Adams did not respond to Newport Crest’s request to schedule a mediation. The court, on its own motion, set an order to show cause re dismissal. After a hearing on the order to show cause, the court ordered Adams’s case dismissed.

Adams appeals from the order denying her motion and granting the application of Newport Crest, from the order dismissing her case, and from an order imposing monetary discovery sanctions against her. In attacking the order denying her motion, she insists that the settlement agreement is binding and that, for a variety of reasons, the court erred in failing to convert it to judgment. But when it comes to challenging the order granting Newport Crest’s application, Adams paradoxically maintains that the settlement agreement is completely unenforceable, due to fraud in the inducement, failure of consideration, a lack of meeting of the minds, and the invalidity of what she characterizes as a “binding mediation” provision. In other words, if the settlement agreement is construed to include the mediation provision that it clearly does contain, then she insists the settlement agreement cannot be binding, but she desperately wants the settlement agreement to be enforced, minus the mediation provision to which she agreed.

Although Adams asserts in the statement of issues in her opening brief, that the court erred in denying her motion to vacate and in denying an application for a temporary restraining order, she provides no argument in support of her assertions. Consequently, any challenges to those orders are deemed waived. (R. A. Stuchbery & Others Syndicate 1096 v. Redland Ins. Co. (2007) 154 Cal.App.4th 796, 801-802, fn. 3.) In a footnote on page 36 of her opening brief, Adams says that, due to word count limitations, she does not address her application for a temporary restraining order, but requests the court to review it anyway. We decline to do so. It is not our job to raise arguments for the parties. (Niko v. Foreman (2006) 144 Cal.App.4th 344, 368.)

Substantial evidence supports the trial court’s implied finding that the parties entered into a binding settlement agreement. Moreover, the court properly interpreted the terms of the settlement agreement to require the parties to submit disputes to the mediator before seeking judicial relief. It did not err in denying Adams’s motion as framed and in granting Newport Crest’s application.

However, it would appear Adams did not like the order to mediate. Her attorney did not provide Newport Crest with dates to schedule the mediation. After she substituted her attorney out, Adams, a licensed attorney herself, did not contact Newport Crest about the mediation that had been ordered. Newport Crest had difficulty serving her with correspondence concerning the ordered mediation, and ultimately paid a private investigator to serve Adams when she was in court on an unrelated matter. Having received the correspondence, she chose not to respond. Adams has not shown that the court erred in dismissing the settled case.

Where the sanctions order is concerned, Adams tagged the issue in her opening brief, but said that due to page limitations she could not “complete” her argument. She saved the considerable sanctions argument for her reply brief, where Newport Crest could not respond to it. We do not countenance these tactics. Adams is deemed to have waived her arguments concerning the sanctions order.

We affirm the order denying Adams’s Code of Civil Procedure section 664.6 motion and granting Newport Crest’s application, the sanctions order, and the dismissal. On a separate point, having received no objection from Newport Crest, we grant Adams’s motion to augment the record to include copies of a proposed judgment, a revised proposed judgment, and supporting proofs of service, that she lodged with the trial court.

I

FACTS

A. Settlement Agreement:

In November 2006, Adams and Newport Crest entered into a settlement agreement. The settlement agreement consisted of a six-page initial document, a 10-page attachment A, and a two-page addendum, each with signature pages. The settlement agreement involved two primary components: (1) a $500,000 payment from State Farm Insurance Company to Adams, as set forth in the initial document; and (2) the performance of substantial additional obligations by Newport Crest, pursuant to attachment A.

Attachment A contemplated that Adams would vacate her unit and that her personal property would be removed. It required Newport Crest to remediate the unit and certain of Adams’s personal property, to pay for the storage of certain personal property, and to pay Adams $3,500 per month for living expenses. The parties agreed that the remediation would “include the repairs and abatement measures advocated by the defendants’ construction expert, Anthony Salazar, in his [June 12, 2006] deposition... and/or any other work found necessary by Anthony Salazar (only) to stop current and further water/moisture intrusion.” They further agreed: “Anthony Salazar shall be the supervisor and final authority of what must be done to stop current and further water/moisture intrusion to the HOME, and he is also the final authority on whether those necessary repairs and measures have been properly performed and completed.” The settlement agreement enumerated 14 items to be investigated and addressed by Salazar.

The settlement agreement further provided: “Anthony Salazar shall make the decision whether each repair that he has advised to be done has been correctly and thoroughly completed. The Industrial Hygienist, in its sole discretion, and according to industry standards, shall determine when the HOME has passed the ‘clearance test’ so that rehabitation can occur.” The parties agreed to exercise good faith and due diligence to endeavor to complete the remediation and obtain clearance testing within 90 days.

In addition, paragraph 5 of attachment A provided in part: “The Defendants have represented that Mr. Salazar has agreed to his role as set forth in this agreement. If Mr. Salazar quits, is fired or is otherwise unavailable to perform his function pursuant to this agreement, Plaintiff will be notified immediately of said development and will have the right to approve any replacement.” The addendum to the settlement agreement clarified that Newport Crest had no intention of firing Salazar, so long as he reasonably and timely performed his duties, but that Salazar would be replaced if he could not or would not so perform.

Attachment A required disputes concerning the terms of the settlement agreement or the performance of the obligations thereunder to be submitted to mediation. Steve Kruis was identified as the mediator to be used.

B. Postsettlement Developments:

In March 2007, counsel for Newport Crest wrote to counsel for Adams concerning the status of the remediation. He stated both that Adams’s unit “[had] been clearance tested” and that Newport Crest “[had] attempted to proceed with the remaining repairs.” The letter further stated: “HOWEVER, Anthony Salazar has now indicated that he will not act further on this project unless your client signs a release of him and his company for the work he is designated to do in the settlement agreements. He is very concerned that, even though he was selected with the utmost confidence of [Adams’s former counsel] and myself as a thorough and fair professional, that he is concerned Ms Adams could sue him. [¶] He has hired an attorney to draw up a release and I have directed him to have his attorney contact you directly on this issue. [Newport Crest] is in agreement in principle to sign the release, but he insists that Ms Adams sign it also.” (Italics added.) In addition, the letter warned: “If Ms Adams will not sign the release so that Mr. Salazar can move forward on the tasks asked of him under the Settlement Agreement..., then, pursuant to the Addendum, Newport Crest will [h]ire another contractor of its choice to take over the duties of Mr. Salazar.”

A few weeks later, Newport Crest’s counsel sent another letter to Adams’s counsel regarding the “impasse” with Mr. Salazar. Because releases were not forthcoming, Salazar “[had] refused to participate any longer.” Consequently, Newport Crest notified Adams that it was invoking paragraph 5 of attachment A to the settlement agreement, and hiring Angus Smith, a licensed general contractor, to oversee the completion of the work.

On May 1, 2007, Adams’s new counsel, Stanley R. Jones, wrote to counsel for Newport Crest that no one had ever requested that Adams release Salazar and that she might well have signed a release had one ever been provided to her. He indicated that Adams’s former counsel had not forwarded correspondence about the requested release to Adams. He further stated that Adams would not agree to have Smith do any work on her unit and that she demanded that a mutually acceptable expert replacement for Salazar be located right away.

The record would appear to indicate that Attorney Jones was the third attorney to represent Adams, Attorneys Court Purdy and Robert Legate each having represented her previously.

Counsel for Newport Crest provided an immediate reply, stating that the unit had been clearance tested and all settlement agreement obligations had been resolved. He also stated that Adams was free to move back into her unit and that Newport Crest would no longer pay her $3,500 per month in living expenses.

C. Procedural History:

On May 22, 2007, Adams filed a motion to enforce settlement agreement pursuant to Code of Civil Procedure section 664.6. Eleven pages of her points and authorities were devoted to describing Newport Crest’s purported breaches of, or other failures to perform its obligations under, the settlement agreement. In the conclusion to her motion, Adams requested the entry of a judgment, in the form submitted therewith, ordering the defendants to perform repair and remediation work as detailed in the settlement agreement.

Newport Crest filed both an opposition to Adams’s motion and an ex parte application for an order enforcing the settlement agreement and compelling mediation. In its application, Newport Crest contended Adams breached the settlement agreement by refusing to submit her dispute to the mediator before seeking judicial relief. Without citing Code of Civil Procedure section 664.6 or other statutory authority, Newport Crest sought an order enforcing the settlement agreement by compelling mediation. In opposition to Newport Crest’s application, Adams argued that she was not required under the terms of the settlement agreement to commence mediation, because there was no dispute as to the terms of the settlement agreement, which would require mediation, but only a dispute as to the performance of the settlement agreement, which would not require mediation.

At the conclusion of the hearing on both matters, the court gave Adams an opportunity to file a supplemental opposition to Newport Crest’s application, and gave Newport Crest an opportunity to file a reply. In her supplemental opposition, Adams argued that Newport Crest’s application should be denied because she had come to realize the entire settlement agreement was unenforceable given that: (1) “Defendants either never secured Salazar’s participation or prevented Salazar’s participation and thereby removed core consideration for the settlement”; (2) the nonparticipation of Salazar gave rise to an agreement to agree at a later date about a “central material term”; (3) defendants’ interpretation of the settlement agreement eviscerated the core material terms of the settlement agreement so there was no contract formation; and (4) requiring binding mediation would make the agreement unenforceable under Lindsay v. Lewandowski (2006) 139 Cal.App.4th 1618.

In reply, Newport Crest emphasized that the parties had indeed entered into a binding settlement agreement that needed to be enforced. It stated that Adams’s own motion to enforce the settlement agreement was a judicial admission that the settlement agreement was enforceable and that, in any event, she was bound by the plain language of the settlement agreement notwithstanding any subjective understanding on her part. Newport Crest also stated that Lindsay v. Lewandowski, supra, 139 Cal.App.4th 1618 was distinguishable, and further that there was no legal authority “for ignoring the express agreement to first submit disputes to the mediator.” Given that Adams’s main concern was with its purported failure to make good on its obligations under the settlement agreement, Newport Crest said that it would present all necessary evidence of compliance to the mediator, pursuant to the procedure set forth in the settlement agreement.

The court, in a July 2, 2007 minute order, granted the application of Newport Crest to enforce the settlement agreement. It denied the motion of Adams. Several days later, Attorney Aaron J. Mortenson spoke to Attorney Jones and told him Newport Crest wanted to proceed to mediation as soon as possible.

On July 10, 2007, Attorney Jones wrote a letter to Kruis asking for information on binding mediation — the process, and the applicable rules and evidentiary standards. He copied Attorney Mortenson on the letter. Kruis sent an e-mail to Attorney Jones in reply. Kruis stated that he no longer acted as a neutral who rendered binding decisions and that he declined to act in that capacity on behalf of the parties. However, he said that he would be pleased to act as a mediator without the power to render a binding decision. Attorney Mortensen was not copied on the e-mail and he represents that he was not informed of the matter.

Adams, herself a licensed attorney, substituted herself, in propria persona, as attorney of record in place of Attorney Jones. She filed her substitution of attorney on July 16, 2007.

Counsel for Newport Crest, on August 22, 2007, wrote a letter to Adams stating that, per court order, any remaining disputes were to be brought before Kruis. Counsel requested that Adams contact him to schedule the mediation, if any issues remained unresolved. In the alternative, if no issues remained unresolved, counsel would prepare a request for dismissal with prejudice for Adams’s signature. The overnight express carrier made three attempts to serve the letter on Adams (signature required), but was unsuccessful. Newport Crest managed to effectuate personal service of the letter on Adams when she was appearing in court on an unrelated matter on September 4, 2007.

On September 6, 2007, the court issued an order to show cause re dismissal. It set a hearing for October 29, 2007. The minute order stated: “If a full dismissal has not been filed and there are no appearances on that date the Court will dismiss this matter on its own motion.”

Adams chose not to respond to Newport Crest’s demand to either mediate or dismiss, because she felt that the settlement agreement required neither one, and she preferred to address the matter in court at the hearing on the order to show cause. Her feelings about the settlement agreement notwithstanding, she has declared that she “[understood] that the court’s Order that Defendants and I take the matter to binding mediation was still pending and active at the time” of the order to show cause re dismissal.

On October 18, 2007, she filed a second lawsuit against Newport Crest (Related Lawsuit). (Adams v. Newport Crest Homeowners Association (Super. Ct. Orange County, 2007, No. 07CC01390).) In her notice of related case, filed in the Present Lawsuit on October 24, 2007, Adams stated that the Related Lawsuit “involve[d] the same parties and [was] based on the same or similar claims.”

The named defendants in the Related Lawsuit include Newport Crest, certain of its property managers and attorneys, State Farm General Insurance Company, contractor Angus Smith, and certain members of the Newport Crest board of directors. Adams asserts 15 causes of action, including fraud, bad faith, conspiracy, intentional infliction of emotional distress, breach of contract, nuisance, unjust enrichment, injunctive relief and declaratory relief. Adams’s first amended complaint states: “Among other things, the present Action involves a Settlement Agreement contract induced by fraud.” In addition to general, special and punitive damages, Adams seeks declaratory relief regarding the settlement agreement.

On October 25, 2007, Newport Crest filed, in the Present Lawsuit, a statement re order to show cause re dismissal. Newport Crest stated that Adams had never contacted it concerning resolution of the matter after she undertook self-representation. It further stated that Adams had evaded service of communications regarding the scheduling of mediation and resolution of the matter. In addition, Newport Crest said that it had needed to hire a private investigator to personally serve Adams, while she was in court on another matter, with a request to provide dates for mediation, but that Adams had refused to respond. Newport Crest claimed to have spent hundreds of thousands of dollars to settle Adams’s personal injury claims, remediate her property and pay her living expenses, and tens of thousands of dollars to defend the Present Lawsuit. It further claimed to continue to incur monthly costs for the storage of Adams’s personal property. Newport Crest contended that it had complied with the settlement agreement but Adams had not, and that the matter should be dismissed.

A hearing took place on October 29, 2007. Adams complained that she had not had an opportunity to respond to Newport Crest’s statement re order to show cause. In addition, she argued that it was impossible to follow the court’s July 2, 2007 minute order, because Kruis had declined to conduct a binding mediation. On October 30, 2007, the court dismissed the Present Lawsuit.

The following month, Adams filed a motion to vacate the dismissal and for a new trial. The court denied Adams’s motion. Adams then filed her notice of appeal.

II

DISCUSSION

A. Introduction:

Adams contends the mold and fungus in her condominium ruined her health, caused her to close her law practice, caused her to vacate her home, and put her home at risk of foreclosure due to her inability to work. She contends Newport Crest failed to make good on its performance obligations to remediate the dwelling. Furthermore, Adams asserts Newport Crest committed fraud to induce her to enter into the settlement agreement, inasmuch as it represented that Salazar had agreed to supervise the remediation to his satisfaction, when in fact Salazar had never been hired to act in that capacity.

Adams contends the trial court: (1) erred in failing to address the validity of the settlement agreement; (2) erred in denying her motion; (3) erred in granting Newport Crest’s application; (4) erred in dismissing the Present Lawsuit; and (5) abused its discretion in imposing monetary sanctions against her. We address these issues in turn.

B. Motions to Enforce Settlement Agreement:

(1) Code of Civil Procedure section 664.6

Code of Civil Procedure section 664.6 provides: “If parties to pending litigation stipulate, in a writing signed by the parties outside the presence of 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.”

(2) Standard of review

The standard of review when a settlement agreement is the subject of a Code of Civil Procedure section 664.6 motion was explained in Skulnick v. Roberts Express, Inc. (1992) 2 Cal.App.4th 884: “A trial court, when ruling on a section 664.6 motion, acts as a trier of fact. [Citation.] Section 664.6’s ‘express authorization for trial courts to determine whether a settlement has occurred is an implicit authorization for the trial court to interpret the terms and conditions to settlement.’ [Citation.] The proper standard of review, therefore, is whether the trial court’s ruling [construing] the settlement... is supported by substantial evidence. [Citation.]” (Id. at p. 889.)

“A settlement agreement is a contract, and the legal principles which apply to contracts generally apply to settlement contracts. [Citation.] An essential element of any contract is ‘consent.’ [Citations.] The ‘consent’ must be ‘mutual.’ [Citations.]” (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793, 810-811.) “‘The existence of mutual consent is determined by objective rather than subjective criteria, the test being what the outward manifestations of consent would lead a reasonable person to believe.’ [Citation.]” (Id. at p. 811.) “The parties’ outward manifestations must show that the parties all agreed ‘upon the same thing in the same sense.’ [Citation.]” (Ibid.)

(3) Implied findings

In its July 2, 2007 minute order, the court stated: “1) Motion by Defendant Newport Crest to Enforce Settlement Agreement is GRANTED. Disputes regarding settlement agreement must first be submitted to mediator Steven Kruis, pursuant to Attachment A, paragraph 1 of settlement agreement [parties had agreed that the mediator may issue a final and binding ruling]. 2) Plaintiff Adams Motion to Enforce Settlement Agreement is DENIED. Administrative remedy, above, has not been exhausted.” (Parenthetical in original.)

Adams complains heartily that the court failed to make any determination as to the validity or voidability of the settlement agreement, especially considering that she had raised issues pertaining to the formation of the contract, including the possible misrepresentation of Salazar’s participation. She also says the court misunderstood its task under section 664.6 — to determine whether the parties entered into a valid and binding settlement agreement — not to determine whether the terms of the settlement agreement have been performed.

The minute order itself dispels her assertions. In granting Newport Crest’s application and ordering the matter to mediation, the court impliedly found that the parties had entered into a binding settlement agreement. (Virtanen v. O’Connell (2006) 140 Cal.App.4th 688, 709 [all findings necessary to support judgment are implied].)

Substantial evidence supports that finding. All parties signed the settlement agreement, which was approved by their counsel. Unlike the situation in Lindsay v. Lewandowski, supra, 139 Cal.App.4th 1618, they all signed the same version of the settlement agreement. All parties want the settlement agreement to be enforced; it’s just that Adams, in effect, wants the mediation provision to be excised.

Not only has the settlement agreement been fully signed, it has been partially performed. Adams has received a $500,000 payment, and she acknowledges that the monetary and performance obligations under the settlement agreement are not severable. Furthermore, Newport Crest allegedly has made a number of $3,500 monthly living expense payments, has paid some amount for storage of Adams’s personal property, has performed some amount of remediation on her unit, and has paid for some amount of remediation with respect to her personal property. The dispute is as to whether Newport Crest has finished its work, and if not, what is left to be done.

Having found substantial evidence to support the trial court’s finding that the settlement agreement is enforceable, we now look to the terms of that agreement to see if they were properly applied.

(4) Settlement agreement language

Paragraph 1 of attachment A provides: “[I]t is the intent of the parties that this agreement constitutes a binding Settlement Agreement of the released claims pursuant to Evidence Code Section 1123 and further that this document shall be admissible into evidence to enforce its terms pursuant to Code of Civil Procedure section 664.6. In the event there is a dispute as to the terms of this Settlement Agreement, the parties agree to submit any dispute first to the mediator, Steve Kruis, and further agree that the mediator may issue a final and binding ruling thereon.”

Paragraph 12 of attachment A provides: “It is further agreed that Judge [Didier] will retain jurisdiction over the terms and conditions contained in this Agreement and that he has the power to enforce any and all tasks, obligations, duties, and/or terms if the mediator has not or will not issue such orders as necessary to effect compliance with said provisions. In the event that a party is found to have violated any tasks, obligations, duties, and/or other terms of this Agreement, the prevailing party in any dispute brought before Judge [Didier] or the mediator regarding such will be entitled to an award of reasonable attorney’s fees and costs, including investigat[ion] costs, for having to enforce any terms of this agreement. The mediator may set such attorney’s fees and costs award, his decision being final and binding.”

(5) Analysis

(i) Adams’s motion

Adams reads this language to mean that the matter must be submitted to mediation before it is confirmed to judgment only if there is a dispute as to terms. Since the only dispute is as to performance under the settlement agreement, not as to the terms of the settlement agreement, there is no need for mediation, and no prerequisite for enforcement of the settlement agreement pursuant to Code of Civil Procedure section 664.6.

It would appear that Adams is focusing her attention only on paragraph 1 of attachment A, to the exclusion of paragraph 12. Paragraph 1 addresses disputes as to the “terms” of the settlement agreement. Paragraph 1 standing alone could be construed to refer to only the interpretation of the wording of the legal document as opposed to performance of the obligations expressed therein. However, paragraph 12 is more detailed and provides that the court “has the power to enforce any and all tasks, obligations, duties, and/or terms if the mediator has not or will not issue such orders as necessary to effect compliance with said provisions.” (Italics added.) This makes clear that issues of nonperformance are to be submitted (first) to the mediator. This is underscored by the attorney fees clause contained in paragraph 12. That clause provides that if “a party is found to have violated any tasks, obligations, duties, and/or other terms of this Agreement, the prevailing party in any dispute brought before... the mediator regarding such will be entitled to an award of reasonable attorney’s fees....” (Italics added.) Clearly, the language of paragraph 12 belies the assertion that only issues pertaining to the interpretation of the terms of the settlement agreement, as opposed to its performance, were to be put before the mediator.

This harmonization of paragraphs 1 and 12 is actually consistent with Adams’s expressed understanding of the mediation provision. She explained her understanding in her declaration attached to her supplemental opposition to Newport Crest’s application. She said: “I did not understand the ‘use’ of Mr. Kruis to be anything but an option to reconcile a dispute over a word or deadline and the like. I understood it to be for use during the defendants’ performance on the Attachment A,... to resolve issues that arose contemporaneous to the period in which the defendants were supposed to have been having the work done on the property in accordance with Attachment A.” This declaration is evidence that Adams understood the mediation provision to apply during Newport Crest’s performance of the remediation obligations.

On a related point, Adams’s claim that the use of the mediator was only an “option,” is inconsistent with the explicit wording of the settlement agreement that disputes are to be submitted “first to the mediator.” Her subjective belief is not determinative. The question is whether the parties’ outward manifestations of intent showed that they agreed the matter would be submitted first to the mediator. (Weddington Productions, Inc. v. Flick, supra, 60 Cal.App.4th at p. 811.) The outward manifestation — the written word — shows that the parties agreed compliance matters would be submitted first to the mediator.

To the extent the court denied Adams’s requested relief because she sought not to simply convert the settlement agreement to judgment, but also to have the court in essence adjudicate that Newport Crest had indeed committed many breaches of the settlement agreement, the court did not err. Paragraph 12 of attachment A made plain that the court was to adjudicate compliance issues only if the mediator had not done so or would not do so. The order was entered on July 2, 2007, so no issues regarding Kruis’s participation had then arisen out of his July 10, 2007 e-mail.

In her opening brief, Adams claims that she did not request the court to adjudicate Newport Crest’s nonperformance. Yet 11 pages of her points and authorities in support of her motion were devoted to the purported nonperformance of Newport Crest. Moreover, in her motion she requested the court to “issue a Judgment based on the Agreement in the form submitted herewith that will order defendants to perform forthwith the repair and remediation which they agreed to do.” That proposed judgment identified a dozen tasks for Newport Crest to perform and 15 tasks for Salazar’s replacement to perform. Were the court to enter the judgment as proposed, it would impliedly find that none of those tasks had been completed or none had been completed properly — a matter in dispute. In addition to the findings that would be implied, the proposed judgment contained some specific findings. For example, the proposed judgment stated: “Mr. Salazar recommended a brow ditch, but Newport Crest installed a [F]rench drain, and the Salazar replacement is to have a brow ditch installed....” It also stated “sliding glass doors and screens moved smoothly in the tracks before the first repairs... were conducted in July 2004, and they have not worked properly since then....”

The relief Adams requested in her reply to Newport Crest’s opposition to her motion, and in her revised proposed judgment, similarly would have required implied or express findings by the court. In her reply, Adams stated, “plaintiff respectfully submits that the proposed judgment presented to the Court with this Reply embodying the terms of the Settlement Agreement and measures for proper performance be entered, including the requirement that plaintiff be permitted to interface with the contractors... and including the requirement that defendants pay plaintiff the $3,500 per month for her agreed additional living expenses, beginning with the payment due May 15, 2007, and their payment of the costs for storage of her duplicated files, until plaintiff’s residence is safe to re-occupy.” A judgment on the requested terms would imply a finding of nonperformance by Newport Crest and impose an obligation to undertake further remediation, as well as make additional payments for living expenses and storage. In other words, it would require a determination of compliance with performance obligations, a matter the parties specifically agreed was to be submitted first to the mediator.

(ii) Newport Crest’s application

In addition to claiming that the trial court erred in denying her motion, Adams contends the court erred in granting Newport Crest’s application, for a number of reasons. We have already disposed of Adams’s argument that the court erred in construing the settlement agreement as requiring mediation of compliance obligations.

In a related vein, Adams says the court misunderstood its function. She notes that, at the June 15, 1007 hearing on her motion, the court stated, “whoever wrote this... liked matters to be resolved outside of court or in some setting, other than forcing another lawsuit to enforce this settlement agreement.... Okay. And so I think what we have here is Kruis... should be the person who reviews this matter.” Adams views this language as an indication that the court got it backwards. In other words, the court thought converting the settlement agreement to judgment was tantamount to “forcing another lawsuit,” instead of avoiding one.

Adams’s interpretation of the court’s comments is inconsistent with additional language from the reporter’s transcript. The court went on to remark that when parties enter into a settlement agreement and one party later claims a breach thereof, often a second lawsuit arises pertaining to the purported breach of the settlement agreement contract. It further stated: “But someone had the foresight to read into this that we don’t want this thing to go to a lawsuit. It is going to be either taken care of by Kruis; if Kruis can’t take care of it, then the trial judge can take care [of] it. So I think it ought to go to Kruis.” In other words, the court correctly interpreted the agreement to mean that there would be no court litigation over whether Newport Crest had breached its obligations under the settlement agreement, without first giving the mediator an opportunity to resolve the dispute.

Oddly, Adams also claims the court’s order, to what she characterizes as “binding mediation,” “was not supported by the contract language.” In fact, the court quoted verbatim the portion of settlement agreement attachment A stating “the mediator may issue a final and binding ruling.” Clearly, the language of the order was supported by the language of the settlement agreement.

Adams objects to the notion that the mediation could be binding, stating that binding mediation is unenforceable after this court’s opinion in Lindsay v. Lewandowski, supra, 139 Cal.App.4th 1618. Although this court in Lindsay did note some conceptual difficulties inherent in the concept of binding mediation, it did not state that binding mediation is in all events unenforceable. (Id. at pp. 1624-1625.)

At the same time, we observe the language of paragraph 1 of attachment A could be more clear. It states “the mediator may issue a final and binding ruling.” (Italics added.) That wording, in isolation, leaves open the question whether the mediator must issue a final and binding ruling, or what happens if he does not. However, paragraph 12 fills in the void, stating that Judge Didier retains jurisdiction and has the power to enforce the terms of the settlement agreement and the obligations thereunder “if the mediator has not [done so] or will not [do so.]” In other words, if, after the matter is submitted to the mediator, he does not issue a final and binding ruling, the court has jurisdiction to do so.

Newport Crest says the settlement agreement “never required ‘binding mediation,’” and the court never ordered it. To be precise, Newport Crest is correct. The parties agreed that the mediator would have the discretion to issue a final and binding ruling. Adams just does not want to run the risk that the mediator will do so.

Adams claims binding mediation would result in a renegotiation of all of Newport Crest’s obligations and allow Newport Crest to “circumvent the full consequences of [its] fraudulent action.” Not so. Nothing in the settlement agreement or in the court’s order to mediate instills in the mediator the authority to renegotiate terms. The mediator’s authority, as expressed in paragraph 12 of attachment A, is to “issue such orders as necessary to effect compliance with” the terms and conditions of the existing settlement agreement. And where Salazar is concerned, the settlement agreement specifically provided for the hiring of a replacement in the event he did not oversee the completion of the work. The mediator has the power to oversee the selection of a suitable replacement, in accordance with the terms of the settlement agreement.

Finally, we address Adams’s assertion that it is impossible to follow the July 2, 2007 order because Kruis will not perform a binding mediation. As indicated above, the parties are not precluded from utilizing Kruis’s services even if he is unwilling to issue a final and binding ruling following mediation. In any event, it would appear that neither party would object were his ruling nonbinding. Or, if Kruis will not participate at all, the court may appoint an alternate mediator.

Adams insists that if the matter is ordered to mediation, no relief will ever be available from the trial court and no Code of Civil Procedure section 664.6 judgment will ever be available, frustrating the express terms of the settlement agreement. This is not the case. If the mediator renders a final and binding ruling, it may be reduced to judgment. If the mediator does not do so, the court has the power to resolve the disputed issues, and thereafter reduce the matter to judgment.

C. Dismissal:

Adams contends the court erred in dismissing her case, for several reasons. For one, she complains that she had no opportunity to submit any opposition to Newport Crest’s statement re order to show cause, that the statement contained false allegations, and that the assertions made in the statement did not support dismissal in any event. At the same time, she acknowledges that the court, in denying her motion to vacate, explained that it had set the matter for hearing, and had dismissed the case, not because of Newport Crest’s statement, but simply because the case had settled. Given that, we need not address Adams’s contentions concerning Newport Crest’s statement.

Another basis of error, Adams says, is that she had no notice of the possibility that her case might be dismissed. She says that the order to show cause re dismissal did not specify any grounds for dismissal. True enough, but the very nature of an order to show cause re dismissal is to put the parties on notice that the case may be dismissed. The order indicated that a dismissal appeared warranted at that juncture when it warned: “If a full dismissal has not been filed and there are no appearances on that date the Court will dismiss the matter on its own motion.”

Adams states more particularly that the court did not give notice of its intent to dismiss the case if Kruis refused to conduct binding mediation. But there is nothing in the record to support the assertion that the court dismissed the case for that reason. To the contrary, at the June 15, 2007 hearing on Adams’s motion, the court remarked that if Kruis was not interested in participating, the court would appoint someone else. And, as noted previously, the court subsequently explained that it dismissed the case simply because it had settled.

In addition to the foregoing, Adams actually claims the court had no contractual authority to dismiss. The settlement agreement obligated Adams to dismiss the complaint after the specified repair and abatement measures had been completed and a successful clearance test had been performed by a certified industrial hygienist. Because these conditions purportedly had not been satisfied, she argues the court had no contractual authority to dismiss her case. Adams is in error in supposing the contract proscribed court authority. The court is not a party to the settlement agreement and its powers do not stem therefrom.

In her last argument, Adams says it was improper to dismiss the case when the enforceability of the settlement agreement remained unaddressed. However, as we have previously stated, when the court granted the application of Newport Crest, it impliedly found that the settlement agreement was binding and enforceable. It set a hearing on the order to show cause re dismissal because the matter had been settled, the settlement agreement was enforceable, and the matter had been ordered to mediation.

Adams’s citation to Irvine v. Regents of University of California (2007) 149 Cal.App.4th 994 is unavailing. In Irvine, we observed that a problem arose when the plaintiff attempted to use a California Rules of Court, rule 3.1385 hearing to obtain a determination that the settlement agreement was unenforceable. The trial court erred in dismissing the case because “[t]he only decision before the court at a rule 3.1385 hearing is whether to dismiss the case or restore it to the civil active list.” (Id. at p. 1001.) Because the plaintiff had alleged a dispute as to whether the settlement was enforceable, the case should have been restored to the civil active list. (Id. at pp. 1001-1002.) Here, in contrast, the matter of enforceability had been resolved before the hearing on the order to show cause re dismissal took place.

California Rules of Court, rule 3.1385(a), (c) obligates a plaintiff to file notice of settlement with the court, and if the settlement provides that dismissal is conditioned on the satisfactory completion of particular terms that are not to be performed within 45 days, the notice must state when the dismissal is to be filed.

D. Discovery Sanctions:

Before the parties entered into the settlement agreement, Newport Crest sought discovery sanctions against Adams. The court ordered Adams to pay a total of $3,000 in sanctions. Adams appeals from the order.

In the topic heading of her opening brief, Adams claims that the order was an abuse of discretion, biased, punitive, and made in disregard of the evidence. After a one-sentence factual recitation, the complete argument, as set forth in Adams’s opening brief, reads as follows: “The trial court ignored the evidence, overlooked Defendants’ abuse of the discovery statutes, and punished [her] for arbitrary reasons. (5 CT 1393-1394 [lines 18-28; 1-13].) She was punished for legitimate health concerns about re-exposure to conditions in the home (SUPP. RT 1-5), and for supplemental responses not within the scope of the Order at issue. [¶] Due to the word-count limitations, this section cannot be completed at this time.”

Adams’s first record reference is to the memorandum of points and authorities in support of her opposition to the sanctions motion. The cited lines do not provide any evidence in support of Adams’s assertions on appeal. Adams’s second record reference is to the reporter’s transcript of the hearing on the sanctions motion. At the hearing, the court expressed doubt that Adams’s health concerns, about entering her condominium to obtain the records needed for discovery responses, in fact made it impossible for her to provide the discovery responses. The court suggested, for example, that Adams might have been able to have someone else obtain the records from the condominium on her behalf. In her opening brief, Adams provides nothing other than these comments, standing in isolation, to prove her point. They are insufficient to demonstrate an abuse of discretion, bias, a punitive action on the part of the court, or an action taken in disregard of the evidence.

Moreover, Adams provides no legal authority to support her assertion that these comments demonstrated an abuse of discretion requiring reversal of the sanctions order. An argument not supported by legal authority is deemed waived. (Roden v. AmerisourceBergen Corp. (2007) 155 Cal.App.4th 1548, 1575-1576.) Furthermore, as Newport Crest points out, neither it nor this court is obligated to speculate about the basis of Adams’s claim of error. “One cannot simply say the court erred, and leave it up to the appellate court to figure out why. [Citation.]” (Niko v. Foreman, supra, 144 Cal.App.4th at p. 368.) Put another way, the “appellate court need not furnish argument or search the record to ascertain whether there is support for appellant’s contentions[.]” (Ibid.)

Furthermore, we disapprove of Adams’s tactics. She had requested permission to file an oversized opening brief, and that request was denied. She chose not to budget space to make room for the sanctions argument in her opening brief, stating that she could not “complete” the argument at the time. So when Newport Crest, at a loss to respond to her amorphous argument, asserted that she had waived it, Adams decided it was time to “complete” her argument, in her reply brief. She then provided 15 pages of information and argument in support of the bare bones issue she had raised in her opening brief.

The problem here is twofold. First, Adams circumvented the page limitations for an opening brief, by choosing not to make her argument in her opening brief, but only to put a place saver there, and to “complete” her argument in her reply brief. Second, she put Newport Crest in a position where it could not respond to her argument, because she did not place it in her opening brief. We do not address arguments made for the first time in a reply brief, because it is unfair to respondents. (Reichardt v. Hoffman (1997) 52 Cal.App.4th 754, 764.) In this case we decline to address the arguments Adams made for the first time in her reply brief, even though she put a place saver in her opening brief. The arguments she made only in her opening brief are insufficient to demonstrate error.

III

DISPOSITION

The order denying Adams’s motion to enforce the settlement agreement and granting Newport Crest’s application is affirmed. The order awarding sanctions against Adams is affirmed. The dismissal of the case is affirmed.

We grant Adams’s August 17, 2009 motion to augment the record. The proposed judgment, revised proposed judgment, and proofs of service attached to her motion shall be deemed a part of the record on appeal.

WE CONCUR: SILLS, P. J., RYLAARSDAM, J.


Summaries of

Adams v. Newport Crest Homeowners Assn.

California Court of Appeals, Fourth District, Third Division
Sep 9, 2009
No. G039956 (Cal. Ct. App. Sep. 9, 2009)
Case details for

Adams v. Newport Crest Homeowners Assn.

Case Details

Full title:KRISTINE L. ADAMS, Plaintiff and Appellant, v. NEWPORT CREST HOMEOWNERS…

Court:California Court of Appeals, Fourth District, Third Division

Date published: Sep 9, 2009

Citations

No. G039956 (Cal. Ct. App. Sep. 9, 2009)

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