2010-00071451-CU-PO

Robert Sellers vs. Tim Baliel

Nature of Proceeding: Motion to Enforce Settlement

Filed By: Lor, Kou

Defendants Tim Baliel, Bruce Marshall, and Florin Auto Wreckers, LLC’s motion to
enforce settlement is granted.

In this action Plaintiff Robert Sellers alleged causes of action against Defendants for
defamation, fraud, negligence, negligent and intentional infliction of emotional distress
and unfair business practices arising out of Defendants’ conduct in towing his vehicle.
In April 2013, the parties mediated the case and reached a settlement whereby
Defendants agreed to pay Plaintiff $30,000 in exchange for Plaintiff dismissing the
matter with prejudice. The agreement provides that it is enforceable pursuant to CCP
§ 664.6. It also included the following:

“Should Defendants require any additional form of settlement agreement and or
release, such shall be prepared by Defendants and submitted for approval as to form
by counsel for Plaintiffs. It is understood that the inclusion of this provision is solely for
the administrative convenience of Defendants. No additional form of agreement or
release shall change any material term of this agreement. Neither the inclusion of this
provision nor the failure to propose, agree upon or execute any additional form
agreement shall vitiate the force and effect of this Agreement as a valid, binding and
enforceable settlement in accordance with its own terms.”

Defendants then drafted a more comprehensive agreement that included specific
terms requiring Plaintiff to be responsible for all medical liens, and to indemnify
Defendants from any Medicare demands. Plaintiff’s counsel refused to approve the
more comprehensive agreement on the basis that it altered the material terms of the
previous agreement. Defendants then obtained consent from their insurance carrier to
simply accept the original settlement without the proposed additional release and
release the $30,000 to Plaintiff. On June 20, 2013, Plaintiff’s counsel picked up the
$30,000 check but returned it the next day due to “Defendants’ long delay in tendering
the settlement check” which Plaintiff considered “a material breach and repudiation of
the settlement agreement entered into on April 16, 2013.”

There is no dispute that the parties entered a binding settlement agreement on April
16, 2013. The only issue is whether the delay in tendering the $30,000 check was a
material breach of the agreement such that Plaintiff was excused from any obligations
under the agreement. The Court concludes it was not. Indeed, the settlement
agreement expressly allowed Defendants to propose an additional form of release as
they did here. (Kor Decl. Exh. 1 ¶ 4.) While Plaintiff is correct that the proposed
release was not permitted to change any material term of the agreement, the fact
Defendants proposed a form of release which he believed was inconsistent with the
agreement did not constitute a material breach. Specifically, the agreement provided
that the “failure to propose, agree upon or execute any additional form agreement” did
not render the agreement invalid. Thus, even assuming Plaintiff is correct that
Defendants’ additional form of release was inconsistent with the agreement (and on
this point the Court expresses doubt that it was given the agreement’s release
language regarding Plaintiff releasing Defendants from all medical liens) Defendants
were permitted to propose the additional release and Plaintiff was free to not agree to
it. Further there is no evidence to support Plaintiff’s argument that Defendants sought
to “withhold payment of the settlement amount in an attempt to extract further
concessions from” Plaintiff. (Oppo. 8:3-6.) Indeed, Defendants withdrew the proposed
additional form of release and tendered the $30,000 settlement payment to Plaintiff on
June 20, 2013.

In addition, the fact Defendants did not tender the check until June 20, 2013,
approximately two months after the settlement agreement was executed, does not
constitute a material breach. Indeed, in that time, Defendants proposed an additional
form of release as allowed by the agreement which the parties met and conferred on.
Given the settlement agreement did not provide a specific time by which Defendants
were required to tender the settlement payment, the approximately two month period between execution and tender was reasonable. While Plaintiff argues that the delay
was a material failure of consideration because time was of the essence in paying the
settlement, the Court disagrees. Indeed, as Plaintiff recognizes in his opposition,
delay only constitutes a material failure of consideration “only if time is of the essence,
i.e., if prompt performance is, by the express language of the contract or by its very
th
nature, a vital matter.” (1 Witkin Summary of Cal. Law (10 ed. 2005) “Contracts” §
815, p. 907.) Here, while Plaintiff argues that resolving the litigation was the focus of
the agreement such that time was of the essence in completing the agreement, the
agreement did not provide that time was of the essence; indeed, it did not even
provide a specific date for tender of the settlement check. Further, given that the
agreement allowed Defendants to propose an additional form of release which Plaintiff
was not required to accept, the agreement contemplated potential additional
negotiations regarding such additional release which would require additional time.
Under such circumstances, Defendants’ two month delay in tendering the settlement
payment was not a material breach of the agreement and Plaintiff was not discharged
from his obligations under the agreement.

As a result, Defendants’ motion is granted. Plaintiff is hereby ordered to dismiss the
action with prejudice upon receipt of the settlement proceeds from Defendants in
accordance with the parties’ agreement. Defendants’ request for sanctions is denied.
No authority is provided which would allow the Court to impose sanctions against a
party on a motion made pursuant to CCP § 664.6.

This minute order is effective immediately. No formal order pursuant to CRC Rule
3.1312 or further notice is required.