Harper v. Poortinga CA4/1

Filed 1/15/21 Harper v. Poortinga CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
GARY L. HARPER, D077067
Plaintiff and Respondent,
v. (Super. Ct. No. 37-2010-
00152136-PR-TR-CTL)
MYRNA M. POORTINGA,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of San Diego County,
Julia C. Kelety, Judge. Affirmed.
Law Offices of Gregory J. Hout and Gregory J. Hout for Defendant and
Appellant.
The Stone Law Group, Kenneth H. Stone and Phillip J. Szachowicz for
Plaintiff and Respondent.
I.
INTRODUCTION
Defendant John C. Poortinga appeals from a judgment entered by the
trial court requiring him to pay a money judgment to plaintiff Gary L. Harper
after Harper brought a motion to enter judgment, pursuant to Code of Civil
Procedure section 664.6 (section 664.6), seeking to enforce a settlement
agreement between the two parties that was entered in a probate litigation
matter.1
Pursuant to the settlement agreement, Harper would assign to
Poortinga certain debentures issued by a business venture called “easi.info”;
Poortinga would resign as trustee of certain trusts for which Harper was a
beneficiary and would issue and deliver to Harper a note for more than
$700,000, payable annually, beginning on September 27, 2014, “at 6%
interest over five (5) years.”
Neither Harper nor Poortinga performed his obligations under the
settlement agreement for a period of approximately two years after the
agreement was reached. In August 2015, Harper filed a breach of contract
action against Poortinga, seeking enforcement of the settlement agreement.
After proceedings in the trial court that spanned several years, the matter
was eventually referred to the probate court for consideration of Harper’s
motion to enter judgment pursuant to the terms of the settlement agreement
under section 664.6.
1 While this appeal was pending, John Poortinga died. After additional
proceedings in the probate court, the parties stipulated that Myrna M.
Poortinga, John Poortinga’s surviving wife, would act as the special
administrator of John Poortinga’s estate “for the sole purpose of prosecuting
the [current] appeal as his personal representative.” The parties requested
that upon Myrna Poortinga’s appointment as special administrator of John
Poortinga’s estate, this court authorize her substitution as the party
prosecuting the appeal on behalf of John Poortinga’s estate. This court
hereby grants the request. Myrna Poortinga is therefore substituted as the
appellant in the pending appeal. However, for purposes of clarity and in
order to maintain consistency in this opinion, we will continue to refer to the
appellant as John Poortinga.
2
The same judge who had overseen the parties’ earlier probate litigation
granted Harper’s motion to enter a judgment pursuant to the terms of the
settlement agreement. The court entered a judgment that required Poortinga
to pay the full amount that would have been due on the note if the note had
been issued and paid in full within five years after the first payment was
required to be made, as specified under the settlement agreement.
On appeal, Poortinga challenges the trial court’s judgment on a number
of grounds. We conclude that Poortinga’s arguments are without merit, and
we therefore affirm the judgment of the trial court.
II.
FACTUAL AND PROCEDURAL BACKGROUND
A. The Probate Case
On September 28, 2010, Harper filed a probate petition for breach of
trust, alleging claims for fraud, deceit, self-dealing, and misrepresentation
against Poortinga, who was a co-trustee of two Harper Family Trust sub-
trusts, known as the Grandchildren’s Trust and the Bypass Trust.
On August 26, 2013, Poortinga and Harper attended a mandatory
settlement conference in the probate action. Poortinga and Harper were in
separate rooms during the settlement conference. The parties reached a
settlement, and someone hand wrote the terms of the agreement on a
Judicial Council form titled “Stipulation and Order after Mandatory
Settlement Conference.” (Some capitalization omitted.) Both Harper and
Poortinga executed the document, along with their respective attorneys. The
stipulated agreement was presented to the court, and Judge Kelety signed
the document under the phrase, “It is so ordered” (some capitalization
omitted), making it an order of the court. Neither the settlement conference
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nor the portion of the proceeding held in open court was reported on the
record.
The final settlement agreement (the Settlement Agreement) included
the following relevant terms:
“John Poortinga:
“(1) To issue Note in favor of Mr. Gary Harper and Joseph
Scirretta, jointly and severally, for $721,750. Said Note
shall be payable at 6% interest over five (5) years, paid
annually at the end of each year on the anniversary of the
Note. First payment due September 27, 2014.
“(2) John Poortinga to provide, under penalty of perjury, a
completed Bankruptcy petition (including all schedules to
include wife’s assets) as if he were going to file the petition
today. Said schedules will be provided w/ declaration under
penalty of perjury no later than September 27, 2013 and
annually thereafter until the term of the Note [sic].
“(3) John Poortinga to disclose in his declaration the atty’s
fees paid to defend this Action, as well as any transfers of
assets made in the past 2 years.
“(4) John Poortinga to pledge all Assets in Excess of any
bankruptcy exemption in favor of the Note and will sign
any further documents that are necessary to effectuate the
pledge of collateral.
“(5) John Poortinga will receive as his property the
shares/debentures of easi.info, inc [sic] share[s] from the
grandchildren Trust, Bypass Trust, + [sic] Gary Harper and
the MENTOR CAPITAL (symbol MMTR) from the Bypass
Trust no later than September 27, 2013.”
The Settlement Agreement also included a release provision by which
the parties agreed to “fully [and] completely release each other from any and
all claims,” as well as a provision stating, “Ct. to retain jurisdiction of this
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matter,” with a notation referencing “664.6,” as well as a further notation
that the “[p]revailing party [is] to receive Atty fees for breach of the
Agreement.”
Also included on the Judicial Council form used by the parties to
memorialize their settlement agreement, in a section just above the parties’
signature lines, was the following typed statement: “I have read the entire
stipulation. I understand it fully and request the court to make our
stipulation the court’s order. I understand that willful failure to comply with
the provisions of this order will be a contempt of court and may be punished
by fine and imprisonment. I waive all further notice of this order.”
The Settlement Agreement was signed and dated by Judge Kelety.
What transpired after the execution of the Settlement Agreement
remains somewhat unclear and the parties disagree as to what, precisely,
occurred. It is clear, however, that after the Stipulation and Order was
entered, Poortinga’s counsel and Harper’s counsel communicated with each
other regarding their clients’ performance under the terms of the Settlement
Agreement. Each party maintains that the other failed to complete his
respective tasks under the Settlement Agreement.
Poortinga contends that, as early as October 9, 2013, he delivered an
executed promissory note and other required documents to his attorney, who
was to exchange documents with Harper’s counsel, and that Harper’s counsel
failed to properly respond. Poortinga refers to an e-mail that his attorney
sent to Harper’s attorney on October 10, 2013, in which Poortinga’s attorney
stated, “I also now have all signed settlement documents in my possession
including: the declaration of John Poortinga; BK schedules; resignations as
Trustee; Assignment of [e]asi.info debentures; and signed promissory note.
With respect to these documents, I need to obtain Gary’s signature on the
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assignments of easi.info debentures. I propose that I forward the originals to
you for you to have Gary sign, then that you return those originals to me
within two weeks. Is that acceptable?” According to Poortinga, his attorney
received no response to this e-mail. However, Harper asserts that his
attorney requested copies of these documents in order to be able to review
them for accuracy and completeness, and that Poortinga’s attorney failed to
provide the documents to Harper’s attorney.
Further, according to a declaration submitted by Poortinga’s attorney,
she and Harper’s attorney separately agreed to the simultaneous exchange of
the documents necessary for both parties to satisfy their respective
obligations under the Settlement Agreement. However, elsewhere in the
record, in a letter dated January 10, 2014, Poortinga’s attorney requested
that Harper “execute and return” the “[e]asi.info assignments,” and that
Harper’s attorney “prepare and forward the real property assignments and
other ancillary documents that John Poortinga needs to sign to effect those
transfers.” The letter stated that once she has received those documents, she
“will gladly forward fully executed copies of the Easi.info assignments, the
note, bankruptcy schedules with accompanying declaration, and my client’s
signed resignations.” Thus, it would appear from this letter that Poortinga’s
attorney was conditioning the delivery of all of the documents that Poortinga
was to execute and deliver on Harper’s performance of his obligation under
the Settlement Agreement to assign the easi.info debentures to Poortinga.
6
The record demonstrates that neither party had performed his
obligations under the Settlement Agreement as of August 2015.2 On August
18, 2015, Harper filed a civil action against Poortinga for breaching the terms
of the Settlement Agreement (the Civil Case). At this point, it was
approximately 11 months after Poortinga’s first payment on the note had
been due (on September 27, 2014), and approximately 23 months after
Harper was to have assigned the easi.info debentures to Poortinga (on
September 27, 2013).
The Civil Case remained pending for approximately four years. Harper
contends that the case languished during this time period due to “numerous
requests for continuances and extensions” resulting from Poortinga’s
“decision to represent himself just over one month before the original Trial
Readiness Conference,” as well as medical issues and the parties’ “hopes of
informally resolving the matter.”3
Poortinga did not deliver a note to Harper, and did not make any
payments, as would have been required on the note, to Harper or to Harper’s
2 In appellate briefing, Poortinga contends that he completed tasks
“(1) and (2)” under the Settlement Agreement—i.e., that he distributed the
remaining assets of the bypass trust to Harper, and that he resigned as
Trustee of the bypass trust on or before September 27, 2013. However, the
location in the record to which he cites for this contention is his personal
declaration, submitted in opposition to Harper’s motion under section 664.6.
In that document, Poortinga stated that he “signed [the] Promissory Note,
the Resignations of Trustee, the ‘Declaration of John C. Poortinga As
Required by the Settlement Agreement Entered Into on August 23, 2013’,
and the Assignments of the trusts’ debentures as Co-Trustee.” It is not clear
whether Poortinga’s execution of these documents was sufficient to constitute
completion of the tasks identified.
3 In December 2018, Harper retained new counsel to represent him in
both the Civil Case and the probate matter.
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attorney during the pendency of the action. The full balance of the
promissory note that Poortinga was obligated to execute pursuant to the
terms of the Settlement Agreement would have been paid in full by
September 27, 2018 if it had been paid within five years of the first payment,
as required under the agreement.
A trial in the Civil Case was set to commence on May 7, 2019.
However, on that date, the trial judge overseeing the Civil Case raised an
issue that had not previously been raised or addressed by either party. The
court indicated that it believed that the Probate Court had retained
jurisdiction over the Settlement Agreement and that “either [ ]side who
wants to enforce it just brings a motion in front of Judge Kelety.” The court
stayed the Civil Case in order to allow the parties to file a motion under
section 664.6 in the Probate Court.4
On May 15, 2019, Harper filed a motion under section 664.6 in
connection with the probate matter in the Probate Division of the trial court.
Harper supported the motion with his own declaration, as well as the
declaration of his attorney, to which various exhibits were attached,
including correspondence between the parties’ attorneys and transcripts from
the parties’ depositions. In the motion, Harper asserted that Poortinga had
failed to satisfy his obligations under the Settlement Agreement, and argued
that the parties’ obligations under the Settlement Agreement were
independent covenants, such that neither party’s obligation to perform was
conditioned on the other party performing. Harper requested that the court
enter a judgment consistent with the Settlement Agreement, including a
4 The trial court in the Civil Case proposed that the parties stipulate to
allow the trial judge in the Civil Case to conduct a proceeding pursuant to a
section 664.6 motion. Poortinga’s attorney was not willing to agree to proceed
in that manner.
8
money judgment in the amount of $964,673.10, which Harper asserted was
the amount that Poortinga should have paid to him on the promissory note
that was to have been issued and fully paid by the time the section 664.6
motion was made, plus attorney fees and costs.
In his opposition to Harper’s section 664.6 motion, Poortinga objected to
certain evidence proffered by Harper, including the submission of the
Settlement Agreement, itself. Poortinga contended that Harper’s signature
on the document had not been authenticated or attested to. In support of this
contention, Poortinga referred to a portion of Harper’s deposition testimony,
which Poortinga characterized as indicating that Harper had not actually
signed the Settlement Agreement.
Judge Kelety—the same judge who had signed the Settlement
Agreement and entered it as a court order—heard Harper’s section 664.6
motion. After the contested hearing, Judge Kelety took the matter under
submission.
On August 21, 2019, Judge Kelety issued an order granting Harper’s
section 664.6 motion. In doing so, the court overruled both parties’
evidentiary objections. Most relevant to the current appeal, the trial court
held:
“Here, the court finds that the agreement between the
parties was valid. It is not ambiguous, was entered into by
parties capable of contracting and was based on mutual
consent, a lawful object and sufficient cause or
consideration. It also continues to be enforceable. (CCP
§ 683.020.) Additionally, in signing the Settlement, both
parties acknowledged that ‘I have read the entire
stipulation. I understand it fully and request the court to
make our stipulation the court[’]s order. I understand that
willful failure to comply with the provisions of this order
will be a contempt of court and may be punished by fine
and imprisonment. I waive all further notice of this order.’
9
With respect to the allegation that the Settlement is not
valid because [Harper] either did not sign it or did not
understand it, the court rejects this contention as [Harper]
was present in court and it is this court’s custom and
practice to verify both that the parties personally signed
the agreement and that they understood its terms. It is
also immaterial that [Harper’s] former attorney believed
the agreement to be ‘tentative,’ as he was not a party to it.
“Additionally, the court rejects [Poortinga’s] argument that
the filing of a civil suit results in a waiver of CCP § 664.6’s
expedited procedure. As correctly noted by [Harper], Hines
v. Lukes (2008) 167 Cal.App.4th 1174, the filing of a civil
suit does not constitute an automatic waiver of one’s ability
to pursue remedies under CCP § 664.6.
“The court also rejects [Poortinga’s] argument that the
signing of the debentures was a ‘condition concurrent,’ and
[Harper’s] failure to sign the debentures excused
[Poortinga’s] obligation to perform. ‘The statutory
language makes it clear [ ] that a party moving for the
entry of judgment pursuant to a settlement under Code of
Civil Procedure section 664.6 need not establish a breach of
contract to support relief under the statute.’ (Hines v.
Lukes, supra, 167 Cal.App.4th at 1185.) Here, as in Hines,
the terms of the Settlement ‘do not indicate that any of the
items specified by [Harper] was required to be performed
before any part of [Poortinga’s] performance became due.’
(Id. at 1184.) ‘[N]onperformance [by Harper] does not
constitute a breach of contract and does not give rise to a
remedy for breach of contract [by Poortinga].’ (Id. at 1185.)
In short, [Poortinga’s] obligation to perform was thus
separate and distinct from [Harper’s] obligation to perform
and [Harper’s] failure to sign the debentures did not serve
to relieve [Poortinga] of his obligations under the
Settlement. Pursuant to these facts, there is therefore also
no basis for relief under the doctrine of unclean hands.
“With respect to the defense of laches, the court finds that
it does not serve to relieve [Poortinga] of his obligations
under the Settlement. As correctly noted by [Harper], his
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civil suit was filed in 2015 and has been proceeding ever
since. Like the current motion, it seeks to enforce the
terms of the Settlement. Even prior to the filing of the civil
suit, [Poortinga] acknowledges that his attorney and that of
[Harper] were engaged in communication regarding
Settlement terms. ‘The elements of laches are (1) the
failure to assert a right (2) for some appreciable period so
as to amount to unreasonable delay (3) which results in
prejudice to the adverse party.’ (In re Marriage of Powers
(1990) 218 Cal.App.3d 626, 642.) Here, [Harper] asserted
his rights early on and he and [Poortinga] have been
engaged in litigation for many years such that [Poortinga]
should have been amply aware that he needed to prepare to
answer for his failure to perform under the Settlement.
Therefore, the court finds both that there was no
unreasonable delay by [Harper] and no prejudice to
[Poortinga].
“In light of the above, the court grants the motion and
orders enforcement of the Settlement as to BOTH parties.
Further, it enters judgment pursuant to the terms of the
Settlement, which judgment shall be prepared by counsel
for [Harper]. Such proposed judgment may include a
calculation of interest pursuant to the terms of the
Settlement.”
The court denied Harper’s request for attorney fees and costs, making a
finding “that the request for enforcement could have been brought by either
party based on the other’s failure to perform.”
On September 10, 2019, the trial court signed a proposed judgment
that Harper’s attorney had submitted, with modifications. The judgment
signed by the trial court included the following four provisions:
“1. That GARY L. HARPER have judgment against JOHN
C. POORTINGA in the amount of Nine Hundred Thirty
Eight Thousand Two Hundred Seventy Five Dollars
($938,275.00),
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“2. That JOHN C. POORTINGA shall provide GARY L.
HARPER c/o The Stone Law Group, 225 Broadway, Suite
1720 completed bankruptcy petitions including all
schedules and assets for the calendar years 2014 through
2018, forthwith.
“3. That GARY L. HARPER shall deliver his executed
assignment of the easi.info, inc. debentures to JOHN C.
POORTINGA c/o Gregory J. Hout, Esq., 12396 World Trade
Drive, Suite 206, San Diego, CA 92128, forthwith.
“4. Each party shall bear their respective attorney fees and
costs.”
Poortinga filed a timely notice of appeal from the judgment.
III.
DISCUSSION
A. The trial court did not exceed its jurisdiction pursuant to section 664.6 in
interpreting the Settlement Agreement to include an obligation that
Poortinga pay the note in full within five years after the first payment
came due
Harper filed his motion to enforce the Settlement Agreement under
section 664.6. Section 664.6 provides, “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.”
“Section 664.6 was enacted to provide a summary procedure for
specifically enforcing a settlement contract without the need for a new
lawsuit.” (Weddington Productions, Inc. v. Flick (1998) 60 Cal.App.4th 793,
809 (Weddington).) Ordinary principles of contract interpretation apply to
12
settlement agreements being considered under section 664.6. (Weddington,
supra, at p. 797.)
In ruling on a section 664.6 motion, the trial court acts as a trier of fact,
with the authority to interpret both the express and implied terms of a
settlement agreement. (Skulnick v. Roberts Express, Inc. (1992)
2 Cal.App.4th 884, 889; Fiore v. Alvord (1985) 182 Cal.App.3d 561, 565.) In
determining whether the parties entered into a valid and binding settlement
and what the terms of the settlement are, the court may receive oral
testimony in addition to declarations. (Kohn v. Jaymar-Ruby, Inc. (1994)
23 Cal.App.4th 1530, 1533.) Further, if the same judge presides over both
the settlement proceedings and the section 664.6 hearing, that judge may
avail herself of the benefit of her own recollection of the settlement
proceedings. (See Richardson v. Richardson (1986) 180 Cal.App.3d 91, 97
(Richardson).)
Because we apply settled rules applicable to all contracts when
interpreting the terms of a settlement agreement (Winet v. Price (1992)
4 Cal.App.4th 1159, 1165 (Winet)), as with any contract, a binding settlement
agreement requires mutual consent and definite terms. “ ‘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.]” (Weddington, supra,
60 Cal.App.4th at p. 811.) In ruling on a motion to enter judgment on a
settlement agreement, the trial court must resolve disputed issues relating to
the binding nature or terms of the settlement “and ultimately determine
whether the parties reached a binding mutual accord as to the material
terms.” (In re Marriage of Assemi (1994) 7 Cal.4th 896, 905.)
13
While the court may interpret the terms of the parties’ settlement
agreement, “nothing in section 664.6 authorizes a judge to create the
material terms of a settlement, as opposed to deciding what terms the parties
themselves have previously agreed upon.” (Weddington, supra,
60 Cal.App.4th at p. 810, italics omitted.) Further, a motion to enter and
enforce a judgment under section 664.6 is not equivalent to a breach of
contract action; a party seeking the court’s assistance through a section 664.6
motion need not establish that the settlement agreement has been breached
in order to obtain relief from the court pursuant to section 664.6. (See Hines
v. Lukes (2008) 167 Cal.App.4th 1174, 1185 (Hines).)
We presume that a judgment entered pursuant to a section 664.6
motion, like any other judgment, is correct, and we “must indulge all
presumptions in favor of its correctness.” (Alpha Mechanical, Heating & Air
Conditioning, Inc. v. Travelers Casualty & Surety Co. of America (2005)
133 Cal.App.4th 1319, 1338.) “In keeping with that standard, we will infer
findings in support of the judgment if such findings are supported by
substantial evidence.” (Ibid.) We affirm the factual determinations made by
the trial court if they are supported by substantial evidence. (Weddington,
supra, 60 Cal.App.4th at p. 815.) We review the trial court’s legal conclusions
and contract interpretations de novo. (See Connerly v. State Personnel Bd.
(2006) 37 Cal.4th 1169, 1175.)
Poortinga contends that the trial court exceeded its authority in
determining that he owed Harper $938,275, and in entering a judgment for
that amount. Poortinga argues that “[t]he settlement agreement called for
the performance of an act [i.e., the execution of a promissory note],” but did
“not require the payment of money.” Thus, Poortinga asserts, “[i]f the
settlement agreement requires a party to issue a note payable over the next
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5 years, the court can only order that party to issue and deliver a note
payable over the next 5 years.”
The trial court effectively concluded that the Settlement Agreement
obligated Poortinga not only to execute a promissory note in favor of Harper
and his attorney for $721,750, but also to pay the agreed-upon amount within
five years of the first payment, as set forth in the Settlement Agreement.
The trial court’s determination that the Settlement Agreement
included not only the obligation to issue a promissory note but also the
obligation to pay the amount provided for in the note within a particular time
period is supported by the language of the Settlement Agreement, itself. The
Settlement Agreement not only required Poortinga to issue a promissory
note, but specifically provided that the note was to be paid at six percent
interest over five years, and that each payment was due “annually at the end
of each year on the anniversary of the Note,” with the first payment due on
September 27, 2014. The specificity of the payment schedule, together with
the defined interest rate, demonstrates that the parties agreed that
Poortinga not only had to execute the note evidencing his promise to pay, but
also that he was obligated to pay the amount stated in the note, plus the
identified interest, over a five-year period beginning on the date the first
payment was due.
Given the trial court’s finding that a material term of the Settlement
Agreement was that the promissory note would be paid with interest over
five years, the court clearly acted within its jurisdiction in entering a
judgment enforcing that term. (Cf. Ames v. Paley (2001) 89 Cal.App.4th 668,
674 [court could fix date of commencement of promissory note as a date prior
to entry of judgment, such that interest would accrue from that point
forward, where settlement agreement provided for dates on which obligation
15
was to commence and be fulfilled].) The trial court’s interpretation of the
parties’ agreement is consistent with the Legislature’s intention of providing
an efficient means of enforcing all of the terms of a settlement without the
necessity of filing a separate lawsuit. Its order did not exceed the court’s
jurisdiction under section 664.6. (See Weddington, supra, 60 Cal.App.4th at
809.)
Poortinga also suggests that the trial court erred in entering a
judgment for payment of money because, he contends, the court misconstrued
Harper’s section 664.6 motion “as a claim to enforce a note.” According to
Poortinga, “[t]here was no claim for damages based on an alleged default on a
promissory note before the [c]ourt,” and thus, the trial court “was limited to
ordering Poortinga to issue a note.” This argument appears to be simply
another version of Poortinga’s argument that the trial court acted in excess of
jurisdiction in entering a judgment requiring him to pay money to Harper.
This argument fails to acknowledge that the trial court interpreted the
Settlement Agreement as including the obligation not only to sign and deliver
a note to Harper, but also to make payments to Harper on a specified
schedule that required full payment within five years of the date of the first
payment. We therefore reject Poortinga’s contention that the trial court
erred by misconstruing Harper’s motion to enforce the settlement agreement
as a “claim to enforce a note.”
B. The trial court did not err in considering the declarations and supporting
exhibits that Harper submitted; there is sufficient evidence to support the
finding that both parties voluntarily entered into the Settlement
Agreement and understood its terms
Poortinga attacks the judgment on the ground that the trial court’s
ruling “is not supported by substantial evidence.” (Boldface & capitalization
omitted.) Specifically, Poortinga asserts that Harper was “unable to prove
16
mutual assent” (boldface & capitalization omitted) because, he contends,
Harper did not recall the terms of the settlement during his deposition, and
because “[n]o witness can attest to Harper’s signature” on the Settlement
Agreement. Poortinga also suggests that the court erroneously concluded
that “the rules of evidence do not apply to a CCP § 664.6 motion” (boldface &
some capitalization omitted).
Poortinga contends that the “motion was based [solely] on the
declarations of Gary Harper and Kenneth Stone,” who became Harper’s
attorney in 2019. He complains that because Attorney Stone “did not attend
the MSC” and was retained only in 2019, he was “incompetent to provide any
relevant information,” and the court should not have considered Stone’s
declaration for any purpose. Poortinga also challenges Harper’s declaration,
calling it “vague, ambiguous, deceptive and improper.” He asserts that the
“declaration does not say that [Harper] read, understood, or signed the
stipulation,” but instead, merely “concludes that ‘the parties entered’ a
stipulation.” According to Poortinga, the trial court should have sustained
his objection to the admission of Harper’s declaration “on the grounds that it
is based on speculation, lacked foundation, and was thus an improper
conclusion.” Based on his contention that the court erred in overruling his
objections to the Harper and Stone declarations, Poortinga argues that there
was no admissible evidence to support Harper’s motion and, thus, that the
motion should have been denied. We disagree.
Harper attested in his declaration to the fact that he was a party to the
Settlement Agreement. Harper clearly has personal knowledge of any
agreement and can attest that the copy of the Settlement Agreement that he
submitted is what it purports to be. Thus, Harper’s declaration did not lack
foundation and was not based on speculation, as Poortinga suggests.
17
Poortinga also contends on appeal that there was insufficient
foundation for admission of the Settlement Agreement. In the trial court,
Poortinga objected to the submission of the Settlement Agreement on the
ground that there was insufficient foundation for it and that Harper’s
signature had not been authenticated or attested to. However, Harper
attested that the document he submitted, which included a signature that
clearly appears to read “Gary Harper,” was a “true and accurate copy” of the
Settlement Agreement. In doing so, Harper attested to the authenticity of
the document, including his signature.5 Further, the Settlement Agreement
was ultimately entered as an order of the court. The trial court could
therefore have taken judicial notice of the order pursuant to Evidence Code
section 452, subdivision (d). Once the document was before the court, the
court could make factual findings as to whether the signatures on the
document were the parties’ signatures, taking into account the context in
which the document was made an order of the court. (See People v. Skiles
(2011) 51 Cal.4th 1178, 1187 [“a writing can be authenticated by
circumstantial evidence and by its contents”].) Moreover, because Judge
Kelety entered the Settlement Agreement as a court order, she could rely on
her personal recollection and the custom and practice in her courtroom with
respect to entering orders memorializing settlement agreements, in
5 The trial court clearly could rely on Harper’s attestation regarding the
authenticity of the Settlement Agreement proffered in support of his section
664.6 motion. “Authentication of a writing means (a) the introduction of
evidence sufficient to sustain a finding that it is the writing that the
proponent of the evidence claims it is or (b) the establishment of such facts by
any other means provided by law.” (Evid. Code, § 1400.) As a party to the
Settlement Agreement, Harper’s statement that it was an accurate depiction
of the document that he and Poortinga signed was sufficient to sustain a
finding that the Settlement Agreement was indeed what it purported to be.
18
concluding that there was an adequate foundational basis for the document
and that Harper’s signature was authentic. (See Richardson, supra,
180 Cal.App.3d at p. 97 [relying on trial judge’s personal recollections and
experiences in determining the validity and meaning of an oral settlement
agreement to be enforced pursuant to section 664.6].) Thus, even if the court
had rejected Harper’s declaration, as Poortinga urged, it is simply not
reasonably likely that the trial court would have concluded that these two
parties did not mutually assent to the terms of the agreement as reflected in
the written Settlement Agreement that was ultimately memorialized in an
order of the court.
Nevertheless, Poortinga repeatedly suggests that the evidence
presented to the trial court with respect to the section 664.6 motion tends to
demonstrate that Harper did not sign the document and did not reach an
agreement with Poortinga on the material terms, and that the court should
not have considered the Settlement Agreement as evidence that the parties
reached mutual assent as to any terms. Specifically, Poortinga relies on some
portions of Harper’s deposition testimony to argue that the testimony
somehow undermines the court’s determination that both parties consented
to the Settlement Agreement. First, Harper submitted a declaration in which
he stated that the “parties entered into a Stipulation and Order After
Mandatory Settlement Conference” and submitted a copy of the Settlement
Agreement, which includes the parties’ and court’s signatures. Poortinga
suggests that this statement in Harper’s declaration is conclusory. However,
at a minimum, it is an admission by Harper that he did, in fact, assent to the
terms of the Settlement Agreement, as evidenced by his execution of the
document. Further, a review of Harper’s deposition testimony on which
Poortinga relies demonstrates that Harper did not specifically deny signing
19
the Settlement Agreement. Rather, in his deposition testimony, Harper
appeared to question whether the document that he was being shown was a
true copy of the Settlement Agreement that he had signed. After expressing
uncertainty about whether the document that he was being shown was an
accurate copy of the Settlement Agreement, Harper was asked whether the
signature on the document was his. He was equivocal, stating, “I usually
scribble a little more, but then it -- I don’t know, my signature changes if I’m
signing a whole bunch of things -- .” Finally, he said, “Because I can’t
ascertain the rest of the document being an exact copy of it [i.e., the
Settlement Agreement], I could see it not being my signature.” Rather than
constituting testimony that contradicts his declaration that the parties did, in
fact, enter into a settlement agreement, this testimony suggests that at his
deposition, Harper was concerned about whether the document that he was
being shown was in fact a copy of the Settlement Agreement that the parties
had executed.
Further, even if Harper had submitted a declaration that in some way
contradicted his deposition testimony, that would not necessarily render
Harper’s declaration inadmissible, and the court could still have relied on the
declaration. Discrepancies in the evidence would go to Harper’s credibility
and the weight to be afforded to Harper’s declaration. Assessments of a
witness’s credibility are left to the trial court, even when such credibility
determinations are based on a court’s assessment of written declarations.
(Shamblin v. Brattain (1988) 44 Cal.3d 474, 479 [a trial court’s ability to
“assess credibility and resolve any conflicts in the evidence” is entitled to
great weight, and “appellate court[s] should defer to the factual
determinations made by the trial court when the evidence is in conflict,”
irrespective of “whether the trial court’s ruling is based on oral testimony or
20
declarations”].) The court clearly found that the weight of the evidence before
it demonstrated that Harper had indeed signed the Settlement Agreement,
and there is no basis for second-guessing the trial court’s determination in
this regard.
Because the trial court could rely on the terms of the Settlement
Agreement, submitted as an exhibit in connection with Harper’s declaration,
there is clearly substantial evidence to support the court’s further finding
that the parties mutually agreed to a settlement, as well as the court’s
findings as to the terms of that settlement. The document provided the best
evidence of what the parties had each agreed to do. “ ‘Where the parties have
reduced their agreement to writing, their mutual intention is to be
determined, whenever possible, from the language of the writing alone.’ . . .
‘[T]he parties’ expressed objective intent, not their unexpressed subjective
intent, governs.’ ” (In re Tobacco Cases I (2010) 186 Cal.App.4th 42, 47,
citation omitted.) If the terms of that document are not ambiguous and the
parties are not arguing for equally plausible interpretations of a word,
phrase, or term, then extrinsic evidence should not even be considered by the
court. (See, e.g., Pacific Gas & Electric Co. v. G. W. Thomas Drayage etc. Co.
(1968) 69 Cal.2d 33, 39 [extrinsic evidence is not admissible “to add to,
detract from, or vary the terms of a written contract,” but may be used only to
prove the meaning of a contractual term that is susceptible of either of two
interpretations].)
In ruling that Poortinga was required by the terms of the Settlement
Agreement not only to issue a note to Harper in the amount to which the
parties had agreed, but also to make payments on that note pursuant to the
schedule set forth in the Settlement Agreement and to have paid off the note
by the fifth year after the first payment came due, the trial court simply
21
interpreted the terms of the written agreement; no additional evidence was
necessary. Because the court relied on its own order, which memorialized the
terms of the Settlement Agreement, and because this written agreement was
sufficient, standing alone, to support the trial court’s entering a judgment
based on the terms of this Settlement Agreement, even if we were to presume
that Poortinga is correct that the trial court should have sustained his
objections to other evidence that Harper submitted, he cannot demonstrate
that any such error was prejudicial. (See ABM Industries Overtime Cases
(2017) 19 Cal.App.5th 277, 293 [“[T]he ‘judgment of the trial court may not
be reversed on the basis of the erroneous admission of evidence, unless that
error was prejudicial’ ”].)
We therefore reject Poortinga’s arguments challenging the sufficiency
of the evidence, as well as Poortinga’s assertion that Harper failed to
demonstrate that the parties mutually assented to the terms of the
Settlement Agreement.
C. The trial court did not err in interpreting the parties’ obligations under
the Settlement Agreement as being independent obligations or in
rejecting Poortinga’s contention that Harper’s failure to perform
prevents him from recovering through enforcement of the Settlement
Agreement under section 664.6
Poortinga contends, in the alternative, that the trial court erred in
entering a judgment for the payment of money in favor of Harper because
Harper, himself, failed to perform under the Settlement Agreement.
Poortinga maintains that Harper’s obligation was a “condition concurrent” to
Poortinga’s obligations, such that Harper’s failure to perform resulted in
Poortinga being relieved of any obligation to perform.
The obligations of the parties to a contract are either dependent or
independent. (Verdier v. Verdier (1955) 133 Cal.App.2d 325, 334 (Verdier).)
22
The parties’ obligations are considered “dependent” when the performance by
one party is a condition precedent to the other party’s performance. In that
event, one party is excused from its obligation to perform if the other party
fails to perform. (Kaupke v. Lemoore Canal & Irrigation Co. (1937)
20 Cal.App.2d 554, 557–558; Starr v. Davis (1930) 105 Cal.App. 632, 635.)
Contractual obligations may also be dependent when they are concurrent
conditions: Where parties’ contractual obligations constitute concurrent
conditions, “neither party is in default until one party performs or tenders
performance.” (Ninety Nine Investments, Ltd. v. Overseas Courier Service
(Singapore ) Private, Ltd. (2003) 113 Cal.App.4th 1118, 1135.)
If the parties’ obligations are independent, the nonperformance by
Party A does not excuse Party B from performing pursuant to the contract.
Rather, Party B must still perform and Party B’s remedy is to seek damages
from Party A based on Party A’s breach of the contract. (See Fresno Canal
and Irr. Co. v. Perrin (1915) 170 Cal. 411, 416; Hall v. Dekker (1941)
45 Cal.App.2d 783, 788.)
Whether specific contractual obligations are independent or dependent
is a matter of contract interpretation based on the contract’s plain language
and the parties’ intent. (Verdier, supra, 133 Cal.App.2d at p. 334.)
“Dependent covenants . . . [‘]are not favored in the law [citations], and courts
shall not construe a term of the contract so as to establish [that conditions
are dependent] absent plain and unambiguous contract language to that
effect.’ ” (Colaco v. Cavotec SA (2018) 25 Cal.App.5th 1172, 1183; see Verdier,
supra, at p. 334 [“To construe covenants as dependent is to work a forfeiture
as to one party, and no obligation of a contract is to be regarded as a
condition precedent unless made so by express terms or necessary
implication”].)
23
Typically, a court independently interprets the contract to determine
whether its covenants are independent or dependent. (See Banning Ranch
Conservancy v. Superior Court (2011) 193 Cal.App.4th 903, 915–916.) This is
because general rules of contract interpretation apply to this determination,
just as they apply to all aspects of contract interpretation. As a result, when
parties offer different interpretations of contractual language, as here, where
Poortinga argues that the covenants at issue are concurrent and Harper
asserts that they are independent, the court must first determine whether
the language is ambiguous, i.e., whether it is reasonably susceptible to the
interpretation urged by a party. (WYDA Associates v. Merner (1996)
42 Cal.App.4th 1702, 1710.) The “threshold determination of ‘ambiguity’ . . .
is a question of law,” “subject to independent review.” (Winet, supra,
4 Cal.App.4th at p. 1165.)
The trial court specifically concluded that the Settlement Agreement “is
not ambiguous,” and implicitly concluded that the covenants at issue were
independent, and therefore, that each party was obligated to perform his
respective obligations regardless of whether the other party had performed.
Our independent review of the Settlement Agreement’s terms convinces us
that the trial court’s interpretation is correct.
The language of the Settlement Agreement demonstrates that the
parties were to perform some of their obligations by a certain date, but apart
from Poortinga’s obligation to begin paying on the note on September 27,
2014, the parties were not obligated to perform in a certain order or on a
certain date. For example, Poortinga was obligated to provide “a completed
Bankruptcy petition,” but he was to do so “[n]o later than September 27,
2013.” (Italics added.) Another of his obligations—i.e., to “pledge all Assets
in Excess of any bankruptcy exemption in favor of the Note and . . . sign any
24
further documents that are necessary to effectuate the pledge of collateral”—
had no date by which it was required to be completed. Harper was obligated
to give Poortinga “the shares/debentures of easi.info, inc [sic] . . . no later
than September 27, 2013.” (Italics added.)
The use of the phrase “no later than” demonstrates that while there
was a deadline by which certain obligations were to have been performed,
they could have been completed at any point in time prior to that date. The
parties did not include a requirement that any of those obligations be
performed, necessarily, prior to any other obligation being performed, or that
these obligations would have to be performed at the same time. If the parties
had intended to require that their respective obligations be performed
concurrently, they could have included a provision to that effect in the
Settlement Agreement.
Despite the absence of such a provision in the Settlement Agreement,
Poortinga argued to the trial court, and argues again on appeal, that the
parties agreed that they would perform their respective obligations
concurrently. Poortinga bases this argument on communications between the
parties’ former attorneys that occurred after the parties had signed the
Settlement Agreement. Poortinga asserts in his recitation of the factual
history of the case that “[t]he parties agreed that when Poortinga and Harper
had signed the documents [that each had agreed to provide to the other], the
documents would be simultaneously exchanged.” For this point, he cites to
the declaration of his former attorney, in which she states that she and
Harper’s attorney “agreed to share the responsibility of preparing the
required documents to conclude the settlement, obtain our clients’ signatures,
and then simultaneously exchange the documents.” Poortinga contends that
his “attorney’s declaration that the parties agreed at the MSC to an exchange
25
of the documents is unrebutted.” He further argues that “[t]he parties clearly
intended and expressly agreed that their obligations were to be mutual and
to occur simultaneously through an exchange of documents, and [Harper’s
former attorney’s] October 3, 2014 letter to [Poortinga’s former attorney]
confirms this agreement.” He asserts that this demonstrates that the
obligations in the Settlement Agreement were intended to be “conditions
concurrent.”
We disagree with Poortinga’s assessment. First, all of the evidence to
which Poortinga cites involves the attorneys’ attempts to assist their clients
in implementing the logistics of the performance of their obligations under
the Settlement Agreement. At most, this evidence demonstrates that the
attorneys may have attempted to devise their own agreement about how their
clients would conduct the exchange of documents. It does not, however,
demonstrate that the parties ever reached such an agreement. Further, to
the extent that an agreement between the attorneys would purport to add
substantive terms to the Settlement Agreement, such an agreement cannot
be relied on. (See Kaufman v. Kaufman (1980) 101 Cal.App.3d 147, 150
[affirming trial court’s declination to rely on correspondence between parties’
attorneys after oral stipulation was reached, and noting that counsel for
parties do not have authority to bind clients to substantive terms of a
settlement].) As we have already concluded, the Settlement Agreement does
not impose any obligation on the parties to exchange documents
simultaneously or to otherwise perform their obligations at the same time;
the Settlement Agreement is thus devoid of any language indicating that the
parties’ respective obligations were to be concurrent conditions. The fact that
the attorneys for the parties may have discussed the methods by which they
26
preferred to ensure performance of the parties’ obligations cannot overcome
the terms of the agreement to which the parties agreed.
Because we agree with the trial court that the obligations of the parties
as set forth in the Settlement Agreement are independent obligations, we
further conclude that the trial court did not err in rejecting Poortinga’s
contention that his obligations were “extinguished by Harper’s rejections of
tenders of performance.” (Boldface & some capitalization omitted.) Relying
on Civil Code section 1485, Poortinga argues that his “tenders of performance
which were ignored and then rejected equate to performance as a matter of
law and extinguish any further obligations to Harper.” Poortinga’s
conditional offer to perform would not extinguish his obligations to fully
perform, as he suggests. Civil Code section 1485 provides that “[a]n
obligation is extinguished by an offer of performance, made in conformity to
the rules herein prescribed, and with intent to extinguish the obligation.”
However, where the contract does not provide for dependent obligations, a
tender of performance “must be unconditional to be valid.” (Arnolds
Management Corp. v. Eischen (1984) 158 Cal.App.3d 575, 580, citing
Civ. Code, § 1494 [“An offer of performance must be free from any conditions
which the creditor is not bound, on his part, to perform”].) Poortinga admits
that his tender of performance was conditioned on Harper executing the
debenture assignments and delivering them to Poortinga’s attorney. Because
the trial court correctly determined that the obligations set forth in the
Settlement Agreement were independent, a tender of performance that was
conditioned on Harper’s performance was insufficient to extinguish
Poortinga’s obligation to fully perform.
In a related but slightly different argument, Poortinga asserts that
even if Harper’s obligation under the Settlement Agreement cannot be
27
understood to have been a condition concurrent to Poortinga’s obligations,
Harper’s failure to perform his obligation under the Settlement Agreement
should nevertheless bar him from recovering pursuant to the Settlement
Agreement, under section 664.6. However, a motion to enter and enforce a
judgment pursuant to a settlement agreement under section 664.6 is not
equivalent to a breach of contract action, and in moving pursuant to section
664.6, Harper was not pursuing recovery for breach of a contract: “The
statutory language [of section 664.6] makes it clear . . . that a party moving
for the entry of judgment pursuant to a settlement under Code of Civil
Procedure section §664.6 need not establish a breach of contract to support
relief under the statute.” (Hines, supra, 167 Cal.App.4th at p. 1185.)
In Hines, the court addressed a similar question concerning the effect of
nonperformance by one party on the ability of that party to enforce a
settlement agreement under section 664.6. (Hines, supra, 167 Cal.App.4th at
pp. 1184–1185.) In Hines, as here, the appellant contended that the
respondent was barred from enforcing the settlement agreement between the
parties because the respondent had failed to perform his own obligations
under the settlement. (Id.) In that case, the appellant contended that she
had not been able to complete her performance of having a driveway
resurfaced because the respondent, the owner of an adjacent property, had
not provided his written consent to resurface the driveway. The Hines court
rejected the claim that the respondent’s nonperformance prevented him from
seeking the entry of judgment under section 664.6, stating, “The statutory
language makes it clear . . . that a party moving for the entry of judgment
pursuant to a settlement under Code of Civil Procedure section 664.6 need
not establish a breach of contract to support relief under the statute.
Accordingly, the [trial] court was authorized to enter a judgment pursuant to
28
the settlement regardless of whether [appellant’s] nonperformance of her
settlement obligations was excused.” (Hines, supra, at pp. 1184–1185.)
We agree with the Hines court that the fact that the party seeking
entry of a judgment pursuant to the terms of a settlement agreement under
section 664.6 has not, himself, performed does not prevent that party from
being entitled to obtain enforcement of the settlement agreement and entry of
a judgment. We therefore reject Poortinga’s contention that Harper is not
entitled to seek entry of a judgment pursuant to the terms of the Settlement
Agreement entered between them because Harper failed to return the
debentures to Poortinga.6
D. There is no merit to Poortinga’s contention that Harper failed to comply
with the prerequisites for a §664.6 motion
Poortinga makes a separate argument that Harper “is unable to
establish strict compliance with the prerequisites for a §664.6 motion.”
(Boldface & capitalization omitted.) In this argument, Poortinga asserts that
because “Harper has no recollection of signing the stipulation,” he cannot
“prove that he signed the agreement.” Poortinga further suggests that
Harper also cannot “prove that all parties understood all of the terms of a
settlement agreement” because, Poortinga asserts, the court did not confirm
with the parties that they understood the terms of the settlement agreement
and that they agreed to be bound by them, and because Harper had testified
at his deposition that he had been “ ‘hounded’ by the settlement judge” into
signing the Settlement Agreement. According to Poortinga, the signatures of
6 Again, Harper contends that he was unable to sign and deliver the
debentures as a result of Poortinga’s prior attorney’s failure to provide the
debentures to Harper’s attorney in time to allow Harper’s attorney to review
them for accuracy and completeness before having Harper sign them.
29
all parties and proof that all parties understood the terms are prerequisites
to a court’s ability to enforce a settlement agreement.
These contentions are essentially a rehashing of Poortinga’s contention
that the evidence is insufficient to support the trial court’s ruling. Again, the
evidence of the signed Settlement Agreement, which was not only signed by
the parties but also entered as an order by the trial court, is substantial
evidence that both parties did, in fact, sign the document. Further, there is a
specific provision on the Judicial Council form, which both parties signed,
that states: “I have read the entire stipulation. I understand it fully and
request the court to make our stipulation the court’s order.” This provision in
the Settlement Agreement clearly provides sufficient evidence to support a
finding that the parties understood the terms of the settlement agreement.
We therefore reject Poortinga’s suggestion that Harper failed to demonstrate
strict compliance with the prerequisites for entering a judgment pursuant to
the parties’ Settlement Agreement under section 664.6.
E. Harper did not waive his right to enforce the Settlement Agreement
pursuant to section 664.6 through delay or by his earlier decision to file a
separate civil suit, and the doctrine of “unclean hands” does not bar
Harper from enforcing the Settlement Agreement
Poortinga contends that Harper has waived any right to enforcement
the Settlement Agreement by “elect[ing] not to” “utilize the expedited
enforcement procedures set forth in §664.6.” He argues that Harper’s delay,
caused by his filing a separate civil case and litigating that matter for
multiple years, should have been construed as a waiver of section 664.6’s
expedited enforcement procedures.
The trial court specifically rejected Poortinga’s contention that Harper’s
filing of a civil suit should result in his waiver of the expedited procedures of
section 664.6. We see no error in the court’s determination. As the trial court
30
noted, the filing or litigating of a separate civil action need not constitute the
waiver of a party’s ability to also pursue any remedies to which he or she may
be entitled under section 664.6. (Cf. Hines, supra, 167 Cal.App.4th at pp.
1184–1885 [party who failed to state intention of moving under section 664.6
when asked by court during separate civil harassment proceeding did not
“waive[ ] or relinquish[ ] . . . his right to do so”].)
The trial court also rejected Poortinga’s contention that the doctrine of
laches should apply to bar Harper from obtaining relief from Poortinga. The
doctrine of laches is designed to “ ‘ “promote justice by preventing surprises
through the revival of claims that have been allowed to slumber until
evidence has been lost, memories have faded, and witnesses have
disappeared. The theory is that, even if one has a just claim[,] it is unjust not
to put the adversary on notice to defend [against that claim] within the
period of limitation and that the right to be free of stale claims . . . prevail[s]
over the right to prosecute them.” ’ ” (Robert J. v. Catherine D. (2009) 171
Cal.App.4th 1500, 1521.) “[S]uccess on a laches claim is always uncertain
because it is an equitable remedy that depends on ‘the facts and
circumstances of the particular case.’ ” (In re Marriage of Fellows (2006)
39 Cal.4th 179, 188.) “Laches is an equitable, affirmative defense which
requires a showing of both an unreasonable delay by the plaintiff in bringing
suit, ‘ “plus either acquiescence in the act about which plaintiff complains or
prejudice to the defendant resulting from the delay.” [Citation.]’ ” (Highland
Springs Conference & Training Center v. City of Banning (2016)
244 Cal.App.4th 267, 282.) “ ‘If, in light of the lapse of time and other
relevant circumstances, a court concludes that a party’s failure to assert a
right has caused prejudice to an adverse party, the court may apply the
equitable defense of laches to bar further assertion of the right.’ ” (Ibid.) We
31
typically review a ruling on the applicability of the doctrine of laches for an
abuse of discretion. (Straley v. Gamble (201 3) 217 Cal.App.4th 533, 537,
539.)
We see no abuse of the trial court’s discretion in its rejection of
Poortinga’s assertion that laches should apply to bar Harper’s section 664.6
motion. As the trial court noted, although the motion was not filed until
2019, Poortinga was put on notice of Harper’s desire to ensure that Poortinga
met his obligations under the Settlement Agreement as of August 18, 2015,
when Harper filed the Civil Case seeking to enforce those obligations.
Further, Harper was attempting to advance the Civil Case against Poortinga
throughout the intervening time period; it was not simply languishing all of
that time. Indeed, a not insignificant part of the delay in the Civil Case was
due to Poortinga dismissing his attorney, Poortinga representing himself, and
the parties’ attempts to settle the case before the initial trial readiness
conference. It is thus clear that Poortinga had sufficient opportunity to
prepare any defenses to Harper’s attempt to enforce the terms of the
Settlement Agreement. Poortinga is thus unable to demonstrate that he was
prejudiced by any delay in the filing of the section 664.6 motion.
Finally, we reject Poortinga’s assertion that the trial court should have
barred Harper from enforcing the judgment pursuant to the doctrine of
unclean hands. “The defense of unclean hands arises from the maxim, ‘ “ ‘He
who comes into Equity must come with clean hands.’ ” ’ ” (Kendall-Jackson
Winery, Ltd. v. Superior Court (1999) 76 Cal.App.4th 970, 978.) Application
of the doctrine is not a legal or technical defense that may be used as a shield
against a particular claim, but is instead “ ‘an equitable rationale for refusing
a plaintiff relief where principles of fairness dictate that the plaintiff should
not recover, regardless of the merits of his claim. It is available to protect the
32
court from having its powers used to bring about an inequitable result in the
litigation before it.’ ” (Stine v. Dell’Osso (2014) 230 Cal.App.4th 834, 843–
844.) Thus, “ ‘ “ ‘whenever a party, who, as actor, seeks to set the judicial
machinery in motion and obtain some remedy, has violated conscience, or
good faith, or other equitable principle, in his prior conduct, then the doors of
the court will be shut against him . . . ; the court will refuse to interfere on his
behalf, to acknowledge his right, or to award him any remedy.’ ” ’ ” (Katz v.
Karlsson (1948) 84 Cal.App.2d 469, 474–475.) “Any conduct that violates
conscience, or good faith, or other equitable standards of conduct is sufficient
cause to invoke the doctrine.” (Kendall-Jackson, supra, at p. 979.) We review
a trial court’s decision to apply or reject an unclean hands defense for an
abuse of discretion, and apply a substantial evidence standard to any factual
findings made by the trial court with respect to its decision on the application
of unclean hands. (Aguayo v. Amaro (2013) 213 Cal.App.4th 1102, 1109.)
As we have already concluded, the trial court correctly determined that
the obligations imposed on the two parties to the Settlement Agreement are
independent covenants. As a result, the fact that Harper did not perform
under the Settlement Agreement did not relieve Poortinga of his obligation to
perform pursuant to the agreement. The court reasoned that it was holding
both parties to their obligations under the Settlement Agreement, and
because Poortinga’s obligations were not contingent on Harper performing,
the doctrine of unclean hands should not provide Poortinga relief. This was
not an abuse of discretion, particularly in view of the fact that the court’s
judgment required both parties to perform their obligations under the
Settlement Agreement.
33
F. Attorney fees on appeal
Harper asks this court to award him his attorney fees on appeal. The
Settlement Agreement provides that a “[p]revailing party [is] to receive Atty
fees for breach of the Agreement.” Harper acknowledges that the trial court
declined to award him attorney fees or costs on his motion because it
determined that “the request for enforcement could have been brought by
either party based on the other’s failure to perform.” He nevertheless argues
that Poortinga’s appeal is “solely aimed at delaying or avoiding the
enforcement of the [Settlement Agreement] against him and does not concern
outstanding issues of enforcement against [Harper] or [Harper’s]
nonperformance.” For this reason, he asserts, the Settlement Agreement
authorizes an award of attorney fees to him for fees incurred in defending
this appeal.
California Rules of Court,7 rule 8.278(d)(2) provides: “Unless the
[appellate] court orders otherwise, an award of costs neither includes
attorney’s fees on appeal nor precludes a party from seeking them under rule
3.1702.” The introductory language of rule 8.278(d)(2) “implies . . . that when
a party claims the right to an award of attorney fees on appeal pursuant to a
contract or a statute, the party may request that award from the appellate
court in the first instance, and the appellate court may make that award.
(Butler-Rupp v. Lourdeaux (2007) 154 Cal.App.4th 918, 925 (Butler-Rupp)
[discussing introductory language “ ‘[u]nless the court orders otherwise’ ” as
used in former rule 27(c)(2), which is now rule 8.278(d)(2)].)
“[H]owever, the right to recover attorney fees does not arise from the
rule; it arises from the applicable contract or statute.” (Butler-Rupp, supra,
154 Cal.App.4th at p. 925 [determining that the contractual right to recover
7 Further rule references are to the California Rules of Court.
34
attorney fees applies to fees incurred on appeal].) We thus look to the
language of the Settlement Agreement’s attorney fee provision to determine
whether Harper is entitled to an award of fees incurred on appeal. Although
it is clear that Harper is the “prevailing party” in this appeal, we are
unconvinced that Harper is the “prevailing party” as a result of Poortinga
having “breach[ed] the Agreement,” as is required by the terms of the
attorney fee provision in the Settlement Agreement. A finding of the
existence of a breach of a contract requires not only that the person accused
of breaching have failed or refused to perform, but also that the person
asserting the breach must have performed or be excused from performing.
(See Oasis West Realty, LLC v. Goldman (2011) 51 Cal.4th 811, 821.) The
record does not demonstrate that the court found either that Harper
performed or that he was excused from performing. Rather, the court found
that both parties had failed to perform under the Settlement Agreement, and
ordered both parties to perform pursuant to the terms of the Settlement
Agreement. As a result, there was no finding by the trial court that
Poortinga “breached” the Settlement Agreement, and we are not reviewing
any such finding. Because, pursuant to the terms of the Settlement
Agreement, a party is entitled to fees only “for breach of the Agreement,” and
there has been no finding of “breach” in this case, we conclude that Harper
cannot establish that he is entitled to his attorney fees on appeal. We
therefore deny Harper’s request for attorney fees.
35
IV.
DISPOSITION
The judgment of the trial court is affirmed. Harper is entitled to costs
on appeal.
AARON, J.
WE CONCUR:
HALLER, Acting P. J.
GUERRERO, J.
36