Opinion
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
APPEAL from a judgment of the Superior Court of the County of Los Angeles, Mel Red Recana, Judge, Ct. No. BC322050
Initiative Legal Group, Marc Primo, Robert E. Byrnes, and Sharla Manley for Plaintiff and Appellant.
Gleason & Favarote, Paul M. Gleason, Torey J. Favarote, and Richard Y. Chen for Defendant and Respondent.
Mosk, J.
INTRODUCTION
Plaintiff and appellant Lamont Carr (plaintiff) brought a class action against defendant and respondent Torrance Memorial Medical Center (Torrance Memorial) seeking to recover, inter alia, unpaid overtime wages (the overtime claim) on behalf of himself and other similarly situated Torrance Memorial employees. He appeals from a stipulated judgment entered against him as part of a negotiated settlement of his individual claims. Plaintiff contends that notwithstanding the settlement and judgment, he reserved the right to appeal from the trial court’s order summarily adjudicating the overtime claim in favor of Torrance Memorial.
We hold that plaintiff’s reservation of the right to appeal from the summary adjudication order is ineffective because he agreed to dismiss and release his individual overtime claim as part of the settlement, regardless of the outcome of this appeal. As a result, even if we were to reverse the summary adjudication of the overtime claim, plaintiff would not be entitled to any relief on that claim in the trial court. Because the settlement renders the appeal moot, we dismiss the appeal.
PROCEDURAL BACKGROUND
Plaintiff’s class action against Torrance Memorial asserted five causes of action for: (1) recovery of unpaid overtime wages—the overtime claim; (2) violation of Labor Code section 226 based on an alleged failure to make and keep accurate records of the hours worked by plaintiff and the class members; (3) violation of Labor Code section 201 and 202 based on an alleged failure to pay timely wages earned but unpaid at the time of discharge; (4) conversion and theft of labor based on an alleged failure to pay wages on the next payday after they are earned; and (5) violation of Business and Professions Code section 17200 et seq., based on alleged unfair and unlawful business practices.
In support of the overtime claim, plaintiff asserted that, as part of an alternative workweek schedule authorized under Wage Order 5-2001 (Cal. Code Regs., Tit. 8, § 11050), he worked three 12-hour days per week, i.e., his standard workweek was 36 hours. According to plaintiff, he was entitled to overtime pay for every hour he worked beyond 36 hours in a week, but Torrance Memorial only paid overtime for hours worked beyond 40 hours in a week.
Torrance Memorial filed a motion for summary adjudication seeking an adjudication, inter alia, of the overtime claim. The trial court granted summary adjudication of the two issues affecting plaintiff’s overtime claim and of the fourth issue affecting his conversion claim, but denied the motion as to the third issue concerning the rate of the overtime wage to which plaintiff was entitled. The trial court’s ruling had the effect of eliminating the overtime claim from the action.
The motion sought an adjudication of four issues, the first two of which, if granted, would be dispositive of the overtime claim as a matter of law.
The action continued in the trial court, but there is no indication in the record if a class was certified as to any of the remaining claims or as to what happened to the remaining claims. Approximately two and a half years after the trial court ruled on the summary adjudication motion, the parties entered into a settlement agreement. The agreement recited that, “By means of this Agreement, and except as specifically stated in Paragraph 2.2 herein, the parties intend to settle and resolve all disputes, disagreements, claims, demands, defenses, appeals and causes of action relating to or arising out of [plaintiff’s] employment with [Torrance Memorial] including but not limited to the cessation thereof, the Action, as well as any matter that was or could have been litigated by them in the Action. By entering into this Settlement Agreement, [Torrance Memorial] neither admits nor assumes any liability of any nature whatsoever. This Agreement is made as a compromise for the purposes of avoiding the costs attendant to trial and further litigation.”
Prior to the hearing on the summary adjudication motion, the trial court heard plaintiff’s ex parte application to modify a precertification notice to the class. During that hearing, Torrance Memorial’s counsel referenced a schedule for the filing of the class certification motion, but that schedule appeared to be dependent upon the trial court’s ruling on the summary adjudication motion. There is no indication in the record whether that class certification motion went forward as scheduled or otherwise. Neither party raises an issue concerning plaintiff’s ability to settle his individual claims while class claims are still pending. Presumably, the trial court entered the stipulated judgment based on the settlement of defendant’s individual claims because there were no viable class claims pending at the time of the settlement.
The agreement provided that, in return for a payment to him of $9,999, plaintiff would release Torrance Memorial “from any and all claims, causes of action, actions, rights, judgments, obligations, damages, demands, accountings, or liabilities of whatever kind or character, whether known or unknown, suspected or unsuspected, and whether or not concealed or hidden, occurring prior to the execution of this Agreement, which [plaintiff] has, or may have, or has had, against [Torrance Memorial]....”
The agreement was subject to the following terms and conditions:
“2. Terms and Conditions It is the mutual intention of the Parties to forego a trial on the merits, and settle any and all claims known or unknown that [plaintiff] has or may have had against [Torrance Memorial] and/or the Released Parties as defined in paragraph 3.1 below except as expressly stated in Paragraph 2.2 herein.
“2.1. Entry of Judgment Upon the execution of this Agreement, the Parties shall submit a Stipulation for the entry of a final judgment in the Action in favor of [Torrance Memorial].
“2.2. Reservation of [the Appeal] [Plaintiff] shall retain his right to appeal [(the appeal)] the Court’s November 15, 2005 decision granting [Torrance Memorial’s] motion for summary adjudication as to [the overtime] claim.... [Plaintiff] agrees that all other appellate rights arising out of or related to the Action are forever waived and that he will not pursue any appeal other than the [appeal].
“2.3. Time for [the Appeal] [Plaintiff’s] time in which to file notice of the [appeal] shall run from the date on which the judgment described in Section 2.1 is entered. In all respects, the California Rules of Court shall govern the bringing of the [appeal].
“2.4. Dismissal of Claims Upon the occurrence of either of the following, [plaintiff] shall be obligated to dismiss the Action, in its entirety, with prejudice:
a. The expiration of the sixty day period for filing the notice of appeal as to the [appeal].
b. The final disposition of the [appeal] filed in either the California Court of Appeal or the California Supreme Court. (Italics added.)
“2.5. Settlement Payment Within ten (10) calendar days of receiving a conformed copy of a Request for Dismissal form reflecting the dismissal, with prejudice, of the Action in its entirety, [Torrance Memorial] shall cause the Settlement Payment to be issued by check made payable to ‘Initiative Legal Group, LLP Attorney Client Trust Account.’ Said check shall be delivered to Initiative Legal Group to the attention of Matthew T. Theriault, Esq.”
On June 19, 2008, the parties filed a stipulation for judgment that attached a copy of the settlement agreement. The stipulation recited, inter alia, that “[Plaintiff and Torrance Memorial] have entered into a Settlement Agreement wherein the parties agree to settle and resolve all disputes, disagreements, claims, demands, defenses, and causes of action relating to or arising out of [plaintiff’s] employment with [Torrance Memorial], the Action, as well as any matter that was or could have been litigated by them in the Action,...” The stipulation further provided that, “[Plaintiff] retains his right to appeal the Court’s November 15, 2005 decision granting [Torrance Memorial’s] motion for summary adjudication as to [the overtime claim]...; and [plaintiff] agrees that all other appellate rights arising out of or related to the Action are forever waived and that he will not pursue any appeal other than the [appeal from the summary adjudication order on the overtime claim].” The stipulation concluded as follows: “NOW, THEREFORE, IT IS HEREBY STIPULATED AND AGREED by and between the parties through their respective counsel of record that final judgment in this Action shall be entered in favor of defendant [Torrance Memorial] and against [plaintiff], that all parties shall be responsible for their own costs and attorneys’ fees incurred in this Action, with plaintiff reserving his right to appeal the Court’s November 15, 2005 decision granting [Torrance Memorial’s] motion for summary adjudication as to [the overtime] claim; and [plaintiff] agrees that all other appellate rights arising out of or related to the Action are forever waived and that he will not pursue any appeal other than the [appeal from the summary adjudication order on the overtime claim].”
On June 19, 2008, the trial court entered judgment on the parties’ stipulation that provided: “Plaintiff... and... Torrance Memorial have stipulated that judgment shall be entered in this case in favor of [Torrance Memorial] and against [p]laintiff, with both sides bearing their own attorneys’ fees and costs, and [p]laintiff reserving his right to appeal the Court’s November 15, 2005 decision granting [Torrance Memorial’s] motion for summary adjudication as to [the overtime claim].... [Plaintiff] agrees that all other appellate rights arising out of or related to the Action are forever waived and that he will not pursue any appeal other than the [appeal from the summary adjudication order on the overtime claim]. [¶] IT IS HEREBY ADJUDGED AND DECREED that judgment shall be and hereby is entered in favor of [Torrance Memorial] and against Plaintiff in the above-referenced action. All parties shall bear their own costs and attorneys’ fees.”
On August 18, 2008, plaintiff filed a timely notice of appeal from the June 19, 2008, judgment and the underlying order granting summary adjudication.
DISCUSSION
A. Background and Contentions
The trial court entered the summary adjudication order on the overtime claim on November 15, 2005, but plaintiff did not execute the settlement agreement until May 10, 2008, almost two and a half years later. Although plaintiff now characterizes the settlement agreement as being expressly contingent upon an unsuccessful outcome on the appeal, that is not how the agreement reads. The provision on payment is contingent on the filing of a request for dismissal. But, contrary to plaintiff’s assertion, a dismissal is to be filed upon “[t]he final disposition of [the appeal] filed in either the California Court of Appeal or the California Supreme Court.” Pursuant to that language, a dismissal must be filed and payment made, regardless of whether the “final disposition” is an affirmance or a reversal of the trial court’s summary adjudication order—i.e., the settlement is not contingent upon an unsuccessful outcome on the appeal. To the contrary, under the express language of the agreement, plaintiff will be paid and the settlement consummated no matter what the outcome of the appeal.
Because a judgment as to the entire action has been entered, the filing of a request for dismissal would be unnecessary in the event the appeal resulted in an affirmance of the summary adjudication order and judgment. If, however, the appeal were to result in a reversal of the judgment as to the overtime claim, then a request for dismissal as to that claim would be necessary following the remittitur.
The foregoing construction of the settlement agreement is consistent with the release language, which language is unqualified and silent as to any contingency on the effectiveness of the release. As Torrance Memorial points out, plaintiff unequivocally released all claims, including the overtime claim, without making any exception in the event the appeal of the overtime claim is successful. It therefore appears from the express language of the settlement agreement that plaintiff was seeking to preserve his right to appeal from the order summarily adjudicating the overtime claim, but agreeing nevertheless to dismiss and release that claim even if the appeal is successful.
B. Mootness
In light of the language of the settlement agreement, the issue is whether plaintiff can reserve by agreement the right to appeal the summary adjudication of a claim which he has, in effect, agreed to dismiss and release. “‘Generally, courts decide only “actual controversies” which will result in a judgment that offers relief to the parties. [Citations.] Thus, appellate courts as a rule will not render opinions on moot questions.... The policy behind this rule is that courts decide justitiable controversies and will normally not render advisory opinions. [Citations.] [¶] One such event occurring for which a reviewing court will dismiss an appeal is when the underlying claim is settled or compromised.’ (Ebensteiner Co., Inc. v. Chadmar Group (2006) 143 Cal.App.4th 1174, 1178–1179 [49 Cal.Rptr.3d 825].) When a case has settled, dismissal of the appeal is the appropriate disposition because ‘settlement operates as a merger and [bar] as to all preexisting claims and those alleged in the lawsuit that have been resolved.’ (Id. at p. 1179, citing Armstrong v. Sacramento Valley R. Co. (1919) 179 Cal. 648, 651 [178 P. 516].) ‘The reason why an appeal is dismissed if the judgment is satisfied is because the satisfaction moots the issues on appeal. [Citation.] A prejudgment settlement has the same effect. It is decisive of the rights of the parties and bars reopening the issues settled. Absent a fundamental defect the terms are binding on the parties. [Citation.] “... [T]he merits of the original controversy are no longer in issue where a compromise agreement is made in good faith and without fraud, duress or undue influence.”’ (A.L.L. Roofing & Bldg. Materials Corp. v. Community Bank (1986) 182 Cal.App.3d 356, 359 [227 Cal.Rptr. 308] [dismissing appeal as moot where parties settled before entry of judgment].)” (Larner v. Los Angeles Doctors Hospital Associates, LP (2008) 168 Cal.App.4th 1291, 1296-1297 (Larner).)
Moreover, as a general rule, parties cannot consent to preserve an appeal. “The ‘mutual intention of the Parties’ to preserve appeal, however, does not control whether [the] appeal is moot. (Footnote omitted.) The parties’ intent cannot compel [an appellate] court to issue an advisory opinion on issues in which, after the settlement, [the plaintiff] no longer retains any individual, personal stake. In general, ‘we cannot grant [the] plaintiff any relief by reversing an order for claims that have been settled and compromised.’ (Ebensteiner Co., Inc. v. Chadmar Group, supra, 143 Cal.App.4th at p. 1180; see Muccianti v. Willow Creek Care Center (2003) 108 Cal.App.4th 13, 24 [133 Cal.Rptr.2d 1] [finding appeal moot where parties entered into settlement agreement after filing of notice of appeal].)” (Larner, supra, 168 Cal.App.4th at p. 1298.)
And, although parties may not appeal a consent judgment, there is an exception to that rule. “As a general proposition, a party may not appeal a consent judgment. (Norgart v. Upjohn Co. (1999) 21 Cal.4th 383, 399-400 [87 Cal.Rptr.2d 453, 981 P.2d 79].) ‘Parties cannot create by stipulation appellate jurisdiction where none otherwise exists.’ (Don Jose’s Restaurant, Inc. v. Truck Ins. Exchange (1997) 53 Cal.App.4th 115, 118-119 [61 Cal.Rptr.2d 370], fn. omitted.) But there is an exception for cases in which consent was given solely ‘“‘to facilitate an appeal following adverse determination of a critical issue.”’” [Citation.]’ (Norgart v. Upjohn Co., supra, 21 Cal.4th at p. 400.)” (Chavez v. Carpenter (2001) 91 Cal.App.4th 1433, 1438; see also Aloha Pacific, Inc. v. California Ins. Guarantee Assn. (2000) 79 Cal.App.4th 297, 306, fn. 6 [“Where it appears... that the parties intended their consent to a judgment was given only pro forma to facilitate an appeal, the rule that a party may not appeal a consent judgment does not apply”].)
Here, it does not appear from the settlement agreement that the parties consented to the judgment solely to facilitate an appeal from the order adjudicating the overtime claim. Instead, it appears that plaintiff intended to settle all claims, including the overtime claim, while also purportedly reserving a right to appeal that claim. As discussed above, however, under the terms of the settlement, even if plaintiff is successful on the appeal, he nevertheless agreed to dismiss that claim. Plaintiff is therefore seeking an advisory opinion from this court that will not affect his rights in the trial court. As a result, the appeal is moot and must be dismissed. (Larner, supra, 168 Cal.App.4th at p. 1300; see also Watkins v. Wachovia Corp. (2009) 172 Cal.App.4th 1576, 1589 (Watkins) [“a class representative’s voluntary settlement of her individual claim constitutes a settlement of her only claim, and moots her right to proceed on appeal”].)
Plaintiff contends that he retained an economic interest in the class action as it relates to the overtime claim because, if he is successful on appeal, he will have a personal stake in shifting to successful class litigants a portion of the attorney fees and costs he incurred as the class representative. According to plaintiff, that ongoing economic interest serves as a sufficient basis upon which to appeal, even if he has settled his individual overtime claim.
In Watkins, supra, 172 Cal.App.4th 1576, the voluntarily settling plaintiff made a similar contention that the court rejected, noting that the “economic interest” rationale relied upon by the plaintiff had evolved in response the so-called “pick off” cases in which defendants pay the class representatives’ individual claims in an effort to deny them standing to represent the class. “We believe that it is illogical to import the law governing ‘pick off’ cases into the context of a voluntary settlement. Often, a plaintiff brings an action as a class action precisely because the attorney fees involved in bringing the action individually would exceed the value of any judgment the plaintiff could obtain individually. ([Deposit Guarantee Nat. Bank v.] Roper [(1980)] 445 U.S. [326,] 338, fn. 9.) In such a situation, a ‘pick off’ settlement, which gives the plaintiff only the relatively small amount sought as damages, may be inadequate to cover the substantial attorney fees incurred in pursuing the litigation. Thus, the plaintiff who has been involuntarily picked off has not obtained satisfactory relief, and is therefore permitted to continue pursuing the class litigation until complete relief is received. This conclusion is supported by policy considerations which seek to prevent a defendant from avoiding class liability by picking off individual plaintiffs. This is to be distinguished from the case of a voluntarily settling plaintiff. In such a case, the plaintiff has accepted an amount the plaintiff believes is sufficient to make the plaintiff whole. By voluntarily settling, the plaintiff has agreed to accept the offered sum in full satisfaction of the plaintiff’s claim against the defendant. There are no public policy interests implicated by a settlement voluntarily accepted.” (Watkins, supra, 172 Cal.App.4th at p. 1591.)
After distinguishing between “pick off” cases and voluntary settlements of individual claims, the court in Watkins, supra, 172 Cal.App.4th 1576, concluded, “A voluntarily settling plaintiff no longer has any interest in the action; if the class is ultimately certified and obtains a recovery, the settling plaintiff cannot share in it, having already received complete recovery. Whether the settling plaintiff asserts a hypothetical interest in having the plaintiff’s already incurred attorney fees paid out of a future judgment or settlement fund is irrelevant. We cannot conceive of a situation in which a court would enter a judgment, or approve as reasonable a settlement, in which a portion of the class recovery is given to an individual who has already settled and is not a member of the class.” (Watkins, supra, 172 Cal.App.4th at p. 1592.)
We agree with the court in Watkins, supra, 172 Cal.App.4th 1576. By voluntarily settling his individual overtime claim, plaintiff relinquished any arguable interest he had in the putative class action relating to that claim. Thus, he would be unable to participate in any subsequent class recovery on the overtime claim, assuming a class was certified as to that claim and a recovery was obtained on behalf of the class. Any such recovery would belong to the class, and plaintiff, who is no longer a member of the class by virtue of the settlement of his individual overtime claim, would have no legal basis upon which to assert an entitlement to any portion of the attorney fees and costs awarded to the class as part of the recovery. Having voluntarily removed himself from the class, plaintiff no longer has a legitimate economic interest in a future class recovery sufficient to support his right to appeal. The policy considerations that support recognition of such an economic interest in “pick off” cases are not implicated by this case in which plaintiff, by his own choice, has released any right he may have had to share in a future class recovery.
DISPOSITION
The appeal is dismissed as moot. Torrance Memorial is awarded costs on appeal.
We concur: Armstrong, Acting P. J., Kriegler, J.