Update Your Settlement Agreements: Court of Appeal Announces Steps Parties Must Take to Enforce CCP 664.6 Settlement Provisions

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Update Your Settlement Agreements: Court of Appeal Announces Steps Parties Must Take to Enforce CCP 664.6 Settlement Provisions

By: Sabrina C. Narain, Mid-Level Associate, Sanders Roberts LLP

California Code of Civil § 664.6 is too often found in settlement agreements and apparently we have all been using it wrong! The CCP section 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.” (California Code of Civil § 664.6). It has always been common practice for parties to casually throw in a 664.6 provision in a settlement agreement and assume the Court will enforce it’s 664.6 authority should one of the parties need court intervention in enforcing the settlement agreement. Until now, it has not been common practice to do anything more than simply include the 664.6 provision in the settlement agreement, whether or not the agreement is filed with the Court.

However, Justice Chaney of the Court of Appeal, Second District, Division 1 of California took a strict interpretation of CCP § 664.6 in Mesa RHF Partners, L.P. v. City of Los Angeles (2019) 33 Cal.App.5th 913, 917. Mesa held the trial court lacked jurisdiction to hear motions requesting enforcement of settlement agreements despite the parties having previously agreed to a CCP § 664.6 provision within their respective settlement agreement. (Id. at 918; fn 3.) The Court reasoned the trial court had never actually approved the request to maintain jurisdiction beyond voluntary dismissal of the case. (Id. at 917.) The settlement agreements were not attached to the Judicial Council form requests for dismissal or otherwise transmitted to the trial court until the parties filed their motion to enforce settlement. (Id. at 918.) Moreover, the Judicial Council forms were only signed by the attorneys, not the parties. (Id. at 918.) “A request that jurisdiction be retained until the settlement has been fully performed must be made either in a writing signed the parties themselves, or orally before the court by the parties themselves, not by their attorneys of record, their spouses or other such agents (Id. citing Wakeen v. Malis (2002) 97 Cal.App.4th 429.) The “request must be express, not implied from other language, and it must be clear and ambiguous.” (Id. at 918.)

Mesa provided us clear guidelines in how to properly enforce CCP § 664.6: “the parties could have easily invoked section 664.6 by filing a stipulation and proposed order either attaching a copy of the settlement agreement and requesting that the trial court retain jurisdiction under section 664.6 or a stipulation and proposed order signed by the parties noting the settlement and requesting that the trial court retain jurisdiction under section 664.6. The process need to not be complex. But strict compliance demands that the process be followed.” (Id.)

The message is clear. Ensure your agreement and signed order comport with Mesa to avoid any issues in enforcing the settlement agreement.

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