Settlement Agreement Before Litigation - California Section 664.6

Do the summary procedures of section 664.6 apply to the enforcement of a settlement agreement made at a time when no litigation was pending? Viejo Bancorp, Inc. v. Wood (1989) 217 Cal. App. 3d 200 265 Cal. Rptr. 620 resolves a similar but distinct issue. There an action had been filed, the parties to that action had agreed to a settlement of the case, and the action had been dismissed. ( Id. at pp. 203-204). One of the parties then filed a new action and successfully moved pursuant to section 664.6 to have a judgment entered in that new action enforcing the settlement agreement. (217 Cal. App. 3d at p. 204). Our colleagues in Division Three of this court reversed, holding that a motion under section 664.6 "cannot be made in a separate action to enter judgment pursuant to the terms of a settlement in a prior action." (217 Cal. App. 3d at p. 208.) In reaching that conclusion, the court observed that, "by its very terms, section 664.6 is limited to settlements reached in pending litigation." ( Viejo Bancorp, Inc. v. Wood, supra, 217 Cal. App. 3d at p. 206). Furthermore, the court assumed that section 664.6 "requires an action to be pending when the parties enter into the agreement." (217 Cal. App. 3d at p. 206). That assumption is illustrated by its characterization of the issue before it, i.e., whether section 664.6 is available "in an action other than the action in which the settlement was made." (217 Cal. App. 3d at p. 206, italics added.) Our task is to decide whether that assumption is correct. It is. Our primary task in interpreting a statute is to determine the Legislature's intent so as to effectuate the purpose of the law. (Adoption of Kelsey S. (1992) 1 Cal. 4th 816, 826 4 Cal. Rptr. 2d 615, 823 P.2d 1216; Fontana Unified School Dist. v. Burman (1988) 45 Cal. 3d 208, 218 246 Cal. Rptr. 733, 753 P.2d 689). Because the statutory language is the best indicator of legislative intent, we must begin by examining the words of the statute itself (Kelsey S., at p. 826), giving those words their plain meanings ( Roberts v. City of Palmdale (1993) 5 Cal. 4th 363, 376 20 Cal. Rptr. 2d 330, 853 P.2d 496). "When statutory language is clear and unambiguous, there is no need for construction, and courts should not indulge in it." ( West Covina Hospital v. Superior Court (1986) 41 Cal. 3d 846, 850 226 Cal. Rptr. 132, 718 P.2d 119, 60 A.L.R.4th 1257). The statutory language at issue here refers to settlements by "parties to pending litigation" who "stipulate . . . for settlement of the case . . . ." That language is clear and unambiguous. As used in section 664.6, the term "parties" means "litigants." ( Levy v. Superior Court (1995) 10 Cal. 4th 578, 586 41 Cal. Rptr. 2d 878, 896 P.2d 171). There can be no litigants until there is a case on file to litigate. and no one can stipulate to a settlement of "the case" unless and until that case has been filed. Accordingly, that language can only be intended to refer to settlement agreements entered into while litigation between the settling parties is pending. That lack of ambiguity precludes us from rewriting or otherwise imaginatively construing the statutory language in any manner that would extend to the prelitigation release at issue here. ( Faria v. San Jacinto Unified School Dist. (1996) 50 Cal. App. 4th 1939, 1945 59 Cal. Rptr. 2d 72). Even were there any ambiguity to be resolved, the legislative history of section 664.6 reinforces the conclusion that the Legislature intended the section to provide a means of enforcing settlement agreements entered into after litigation has been filed. An analysis prepared by the Senate Committee on the Judiciary describes the problem the legislation was designed to address: "Existing Rule of Court 207.5 provides for a pretrial settlement conference for civil actions. However, neither existing law nor rule of court authorizes an entry of judgment pursuant to the settlement terms." (Sen. Com. on Judiciary, Analysis of Assem. Bill No. 1925 (1981-1982 Reg. Sess.) p. 2.) the absence of that authorization was a problem because "parties who initially agree to the terms of a settlement often change their minds after the case is taken off calendar. Thus the time taken and the money spent on holding pretrial conferences are wasted." (Id. at p. 4). If no litigation was pending between the parties at the time of the settlement, then no judicial settlement conference would ever have been scheduled or conducted, and the problem targeted by the Legislature would not exist. The other cases interpreting section 664.6 confirm our conclusion that the section's summary procedure was authorized only to enforce agreements made while litigation was pending. For instance, Weddington Productions, Inc. v. Flick, supra, 60 Cal. App. 4th 793, opines that the purpose of section 664.6 is to enforce a settlement agreement without the necessity of filing either "a new lawsuit" or " 'a supplemental pleading in the first action.' " (60 Cal. App. 4th at p. 809). There can be no "new" action unless there is an earlier, "old" action.