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GREGORY B. SCHER - State Bar No. 137228
JOHN E. PEER — State Bar No. 95978
KATYA. NELSON - State Bar No. 173759
WOOLLS 4 PEER
A Professional
One
Corporation
Wilshire Boulevard,
Los Angeles,
22"
California 90017
Floor FILED
SAN MATEO COUblTY
4 Telephone: (213) 629-1600
Facsimile: (213) 629-1660 APR 2 9 2014
5
Attorneys for Defendants e'p Ir
6 FARMERS INSURANCE EXCHANGE and Il
TRUCK INSURANCE EXCHANGE ofpUTV GLERK
7
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF SAN MATEO, CENTRAL BRANCH
10
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MICHAELCHANG, an individual, Case No.: CIV 489065
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Plaintiff, NOTICE OF MOTION AND MOTION TO
g 8 13
ENFORCE SETTLEMENT AGREEMENT
AND ENTER JUDGMENT PURSUANT
a Ii>
It --14 FARMERS INSI.JRANCE COMPANY, INC., et CODE OF CIVILPROCEDURE SECTION
al., 664.6
gJ Pgo
Defendants. Date: June 3, 2014
Time: 9:00 a.m.
0 <88 16
Dept.: 7
O
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Complaint Filed: October 28, 2009
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19 TO ALLPARTIES AND TO THEIR COUNSEL OF RECORD:
20 PLEASE TAKE NOTICE on June 3,2014 at 9:00 a.m. or as soon thereafter as the matter
21 may be heard, before The Honorable Steven L. Dylina, in Dept. 7 of the Superior Court of the
22 County of San Mateo, located at 400 County Center, Redwood City, CA 94063, defendants Farmers
23 Insurance Exchange and Truck Insurance Exchange (collectively, "Farmers" ), by and through their
24 attorneys of record, will and hereby do move the Court for an order pursuant to Code of Civil
25 Procedure section 664.6 enforcing the settlement agreement the parties reached in this action and
26 entering judgment pursuant to that agreement.
27 This Motion will be and is based: on this Notice, the Memorandum of Points and Authorities,
28 the accompanying Declarations of Gregory B. Scher, William J. Baron, Arthur Schwarz, Mark D.
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Plevin and Catherine M. Zacharias, the exhibits to those declarations, the accompanying Request for
Judicial Notice and exhibits thereto, all of the pleadings and papers on file in this action, all matters
on which the Court may take judicial notice and such other matters as may be presented to the Court
4 at or before the hearing on this Motion.
STATEMENT OF RELIEF SOUGHT
On the record and in open court on January 27, 2014, plaintiffs reached a settlement with
defendants and other insurers from which the plaintiffs also claim insurance benefits. A week later
8 the Changs signed a written agreement which included all the material terms of the settlement. The
9 settlement resolves all issues presented in this action and in two related actions.
10 Plaintiffs are now attempting to repudiate the settlement. By this motion, Farmers seeks an
order enforcing the settlement agreement plaintiffs agreed to on the record and in written form.
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DATED: April 25, 2014 WOOLLS & PEER
y A Professional Corporation
>816 E. PEER
0 A orneys for Defendants
17 ARMERS INSURANCE EXCHANGE and
TRUCK INSI.JRANCE EXCHANGE
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TABLE OF CONTENTS
Paae
I. INTRODUCTION
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II. STATEMENT OF FACTS
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A. Farmers Issued Policies to Michael Chang for Policy Periods During 1990-
2013.
B. The Changs, Great American, Farmers, and Fireman's Fund
Reached a Settlement of the Various Claims Among Them
C. The Changs Signed a Written Settlement Agreement.
D. The Changs Presented the Signed Settlement Agreement to Wells Fargo Bank,....
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and Advised the Bank that they had Entered into the Settlement.
E. The Changs Now Seek to Repudiate the Settlement. 10
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F. Great American, Farmers, and Fireman's Fund Have Each Signed the ...
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Settlement Document Signed by the Changs.
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x (g~ 15 111 ARGUMENT 12
A. The Court Should Rule That the Changs are Bound by the Terms of the .... ....... 1 2
Settlement Agreement They Signed. 12
18 B. The Court Should Rule that the Precluded &om Disavowing
Changs are The ..... 14
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Settlement Agreement 14
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1. The Changs Confirmed the Settlement Agreement by their Conduct....... 14
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2. The Court Should Rule that the Changs are Equitably Estopped ....
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From Disavowing The Settlement Agreement. ....15
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3. The Court Should Rule that the Changs are Judicially Estopped From ... ....16
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Disavowing The Settlement Agreement. ....16
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IV. CONCLUSION. ....17
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TABLE OF AUTHORITIES
Pa@et'sl
CASES
3
Blix Street Records, Inc. v. Cassidy,
4 191 Cal.App.4th 39 (2010) ...3, 15, 16, 17
Corklan v.Boscoe,
156 Cal.App.3d 989 (1984) . ...13
Crestview Cemetery Assn. v. Dieden
54 Cal.2d 744 (1960) 14
8 Eustace v. Lynch,
43 Cal.App.2d 486 (1941) ...3,15
Gopal v. Yoshikawa,
10 147 Cal.App.3d 128 (1983) ...13
Kohn v. Jaymar-Ruby, Inc.,
23 Cal.App.4th 1530 (1994) . ...13
12
Southern Calif. Edison Co. v. Superior Court
g ). 13 37 Cal.App.4th 839 (1995) . 14
a1)j14 Youngman v. Nevada Irrigation Dist.
~ 70 Cal.2d 240(1969) ...15
STATUTES
8 ~
Code of Civil Procedure section 664.6.). ...3, 12
OTHER AUTHOMTIES
18
Witkin, Summary of California Law, 10th Ed., Contracts $ 749 .. ...14
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24
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MEMORANDUMOF POINTS AND AUTHORITIES
I. INTRODUCTION
This case involves insurance coverage disputes arising from underlying claims and litigation
4 concerning contaminated property owned by plaintiffMichael Chang. (See Complaint, attached to
Request For Judicial Notice ("RJN") as Ex. 4.)
In addition to this lawsuit, plaintiffMichael Chang and his former wife Roxanne Chang have
7 concurrently been involved in two additional, related lawsuits: (1) the underlying action, entitled
8 Bilal Kartal v. Michael Chang, et al., San Mateo County Superior Court, Case No. CIV 458146 (the
9 "Kartal Action"), and (2) separate coverage litigation with Great American Insurance Company
10 ("Great American" ), entitled Great American Insurance Company, etc. v. Michael Chang, etc.,
United States District Court case number 3:12 CV-00833-SC (the "Great American Action"), in
which Great American sought declaratory relief and reimbursement of expenses it incurred in
8 13 defending Changs against the claims asserted against Changs and others in the Kartal Action. (See
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I Declaration of Gregory B. Scher submitted in support of this motion ("Scher Decl."), at tt 2;
Declaration of Arthur Schwartz in support of this motion ("Schwartz Decl."), at $ f[ 2-4); and
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Declaration of William J. Baron in support of this motion ("Baron Dec."), at $ 1.)
17 This lawsuit was set for trial on January 27, 2014. On that day, the Court held a settlement
18 conference jointly in this case and in the Kartal Action. Michael Chang attended the settlement
19 conference, as did the other parties in the Kartal Action, as well as Farmers, Great American, and
20 Fireman's Fund Insurance Company, which had issued insurance policies to other parties in the
Kartal Action. (Scher Decl., at f[$ 4 and 6; Schwartz Decl., at $ 6; Declaration of Mark D. Plevin in
support of this motion ("Plevin Decl."), at f[ 6; Declaration of William Baron in support of this
23 motion ("Baron Decl."), at tt 4.)
24 At the settlement conference, the parties and insurers reached agreement on two settlements.
One settlement, which resolved the claims in the Kartal Action, is not pertinent here. Of concern
here, the Changs, Great American, Farmers, and Fireman's Fund agreed on terms of a settlement that
27 (1) resolved all the claims and issues between the Changs and Great American in the Great
28 American Action, (2) resolved all the claims and issues between the Changs and Farmers in this
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1 action, and (3) resolved the Changs'laims that Farmers and Fireman's Fund owed a duty to defend
2 the Changs in the underlying claims, and that those insurers should pay defense expenses the Changs
3 were ordered to reimburse Great American under the judgment in that case. (See Baron Decl., at $ 6;
4 Scher Decl., at g 7; and Schwartz Decl., at tt tt 8,
9.)
After the settlement terms were reached at the settlement conference, Michael Chang and his
6 counsel appeared on the record before The Honorable Steven L. Dylina. Michael Chang, his
counsel, and the Special Master in the Kartal Action (William Nagle, who also acted as mediator in
8 this action) set out the fact of the settlement and certain basic terms of the agreement on the record.
9 (See the transcript from the January 27, 2014 settlement conference, Exhibit 1 to the Request for
10 Judicial Notice accompanying this Motion ("RJN"), at p. 5.) Based on the settlement, the Superior
Court continued the trial date in this action. (Ex. 3 to RJN.)
12 At the settlement conference, the parties agreed that the terms of the settlement would be
8 13 incorporated in a written settlement document. (See Scher Decl., at f[ 10; Baron Decl., at f[ 9;
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-~14 Schwartz Decl., at f[ 10; Scher Decl., at f[ 10.) Great American's counsel agreed to draft a
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settlement document reflecting the terms reached by the parties. (Baron Decl., f[ 9.) At the
settlement conference, the Changs'ounsel urged Great American's counsel to circulate the draft
17 settlement agreement as soon as possible, so the written settlement document could be finalized
18 quickly. (See Baron Decl., at $ 10; Scher Decl., at $ 11; Schwartz Decl., at $ 11.) The
Changs'ounsel
stated that Roxanne Chang was seeking a refinancing loan &om Wells Fargo Bank, and that
20 —in order to obtain the loan —the Changs needed the signed settlement agreement to show Wells
21 Fargo's loan officers that the judgment against the Changs in this case would be satisfied as part of
22 the settlement. (See Baron Decl., at tt10; Scher Decl., at f[ 11; Schwartz Decl., at $ 11.)
23 Great American's counsel sent a draft settlement document to counsel for the Changs,
24 Farmers, and Fireman's Fund, on January 31, 2014. (Baron Decl., at f[ 12; Ex. 1 to Scher Decl.)
25 That document set out all the material terms of the agreement reached at the settlement conference,
26 including the amounts to be paid, the releases to be provided, the dismissals and satisfaction of the
27 judgment that would follow, among other terms. (Baron Decl., at f[ 13; Scher Decl., at $ 15; Ex. 1 to
28 Scher Decl.)
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Michael Chang and Roxanne Chang each signed that proposed settlement agreement by
2 February 4, 2014. (Scher Decl., at f[ 15; Ex. 2 to Scher Decl.) On that day, Carol Erdie from the
Garrison Law Firm (the Changs'ounsel) sent Great American's counsel an email attaching the
4 settlement document signed by both Michael Chang and Roxanne Chang. (Scher Decl., at $ 15; Ex.
5 3 to Scher Decl.) The Changs thus acknowledged that they agreed to the terms of the settlement
6 negotiated at the settlement conference and set out in the document they signed.
In addition, the Changs presented the settlement agreement they signed to a loan officer at
8 Wells Fargo Bank, and based on that settlement were able to get a loan funded. (Baron Decl., at f
9 10; Schwartz Decl., at $ 11.) After receiving the settlement agreement signed by the Changs, and
10 the Changs'epresentation that a settlement had been reached, Wells Fargo issued the refinancing
11 loan. (See Ex. 3 to Baron Decl.)
12 Now, however, the Changs refuse to acknowledge the settlement. Although the Changs each
signed a document stating the material terms of the settlement agreement —and the Changs
represented to Wells Fargo Bank that they had reached a settlement, in order to obtain a loan-
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the Changs now seek to repudiate the settlement.
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8 ~ Farmers asks the Court to enforce the settlement agreement the Changs signed, which
17 Farmers, Great American, and Fireman's Fund have all signed as well. (Ex. 4 to Scher Decl.)
18 Where, as here, parties have agreed to terms of a settlement, it is well settled that a court has the
19 inherent power to enforce summarily an agreement to settle a case pending before it and enter
20 judgment pursuant to the terms of the settlement. (Code of Civil Procedure section 664.6.)
21 Moreover, the Court should rule that the Changs are precluded from denying they entered
22 into the settlement agreement. The Changs'epudiation of the settlement agreement they signed is
inconsistent with their representations to the San Mateo Superior Court and to Wells Fargo Bank that
24 they had entered into the settlement. The Changs should not be allowed to walk away from the
25 settlement they signed —particularly after they obtained benefits by representing to others that they
26 had, in fact, reached the settlement agreement. See Blix Street Records, Inc. v. Cassidy, 191
27 Cal.App.4th 39, 45-46, 50-51 (2010); Eustace v. Lynch, 43 Cal.App.2d 486, 490-491 (1941).
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H. STATEMENT OF FACTS
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A. Farmers Issued Policies to Michael Chana for Policv Periods During 1990-2013.
The general background of the underlying claims is as follows. During 1977 Michael Chang
4 and Roxanne Chang acquired real property located on Baldwin Avenue in San Mateo, California
(the "Property" ) and a dry cleaning business already located at the Property. Michael Chang
operated the dry cleaners until 1981, when he sold the business, although he continues to own the
Property.
In 2009, Michael Chang filed this coverage litigation against Farmers (the Chang v.Farmers
9 Action), claiming that Farmers owed a duty to defend the Kartal Action under a policy Farmers had
1p issued to the Changs, and renewals of that policy. (RJN, Ex. 4 [Complaint.]) Chang sought a
declaration that Farmers had a duty to defend, and sought damages because Farmers had initially
disclaimed a defense obligation. (Id.)
II- 13 The Changs also claimed entitlement to coverage as additional insureds under policies that
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14 Fireman's Fund issued to Christopher Chang, who was the Changs'enant at the Property after he
5 m>j 15 purchased the Sunrise Cleaners dry cleaning business in 1981. (Plevin Decl., at $ 2.) The Changs
claimed that Fireman's Fund was obligated to defend them against government orders to address
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17 pollution at Baldwin Avenue. (Id.)
18 Both Farmers and Fireman's Fund initially declined to defend the Changs. By 2013,
19 however, Farmers had agreed to defend the Changs in the Kartal Action, under a full reservation of
2p rights, and Fireman's Fund had agreed to defend the Changs against government pollution orders
concerning the property, subject to a full reservation of rights. (Scher Decl., at f[ 2; Plevin Decl., at tt
22 3.)
23 The District Court in the Great American action ruled that Great American had no duty to
24 defend or indemnify the Changs in any matters relating to the pollution at the property, and that the
Changs must reimburse Great American for the defense expenses it had advanced. The Changs then
claimed Farmers and Fireman's Fund were obligated to pay such reimbursement on the Changs'7
behalf. (Schwartz Decl., at tr4; Plevin Decl., at tt 4.) Specifically, the Changs asserted that Farmers
28 must pay the amounts Great American had advanced for the Kartal Action, and argued that
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Fireman's Fund must pay amounts Great American had advanced for site investigation at the
2 Property. (Schwartz Decl. at $ 4; Plevin Decl., at tt 4.) Great American asked Farmers and
Fireman's Fund to pay a portion of the claimed amounts. (Id.)
B. The Chants. Great American. Farmers. and Fireman's Fund
Reached a Settlement of the Various Claims Among Them.
The Special Master in the Kartal Action, William Nagle, had held a number of settlement
7 conferences and settlement meetings concerning the claims in these cases. (Baron Decl., at f[ 2.)
8 The prior settlement discussions with Mr. Nagle also had included the issues raised in the Chang v.
9 Farmers Action, the Changs'laims against Fireman's Fund, and the Changs'laims against Great
American. (Scher Decl., at $ 3; Schwartz Decl. at $ 5; Plevin Decl., at f[ 5.)
After several continuances of the trial date, the trial in the Chang v.Farmers Action was set
12 for Monday, January 27, 2014. (Scher Decl., at $ 4.) The San Mateo County Superior Court set a
settlement conference before trial that day. (Id.) The parties had filed motions in limine, and
Farmers'ounsel expected and was prepared to begin trial ifthe case was not resolved at the
settlement conference. (Id. at tt 5).
This court ordered all of the parties to a settlement conference on the morning trial of the
Chang v. Farmers trial was scheduled to commence. The January 27, 2014 settlement conference
18 was held in both the Chang v. Farmers Action and the Kartal Action. (Scher Decl., at $ 4.) The
19 participants at the settlement conference included Michael Chang, his counsel and consultant
20 (Garrison, Kalfen, and Kelleher), the other parties in the Kartal Action, and counsel for Great
21 American, Farmers, and Fireman's Fund. (Scher Decl., at f[ 6;Schwartz Decl., at f[ 7;Baron Decl. at
22 tt 5.) The lawyer for Fireman's Fund with respect to the Changs'nsurance coverage claims in this
23 matter was not present, but had agreed to be available to participate by telephone. (Plevin Decl. at
24 $ 7; Baron Decl. at f[ 5.)
25 On the day of the settlement conference, the parties and insurers reached agreement on two
26 settlements. The parties in the Kartal Action reached a settlement of the claims in that case.
27 (Schwartz Decl., at tt 8;RJN, Ex. 1 at pp.9-18.) In addition, the Changs, Great American, Farmers,
28 and Fireman's Fund agreed on the material terms of a settlement that resolved the claims and issues
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1 between the Changs and Great American, the claims and issues between the Changs and Farmers,
2 and the claims that Farmers and Fireman's Fund owed a duty to pay the defense expenses the
3 Changs were ordered to reimburse Great American in this case. (See Baron Decl., at tttt 6-8;Scher
4 Decl., at /[7; Schwartz Decl., at)9; Plevin Decl., at)11.)
The material terms negotiated between the Changs, Great American, Farmers, and Fireman's
6 Fund on the day of the settlement conference included the settlement payments among the parties,
7 the releases among the parties, satisfaction of the judgment Great American had obtained against the
8 Changs, among other terms. (See Baron Decl., at $ 7; Scher Decl., at $ 7; Schwartz Decl., at $ 9;
9 Plevin Decl., at g 8-9.) Specifically, Farmers agreed to pay the Changs $1 million; Farmers and
10 Fireman's Fund each agreed to pay Great American part of the amount owed by the Changs under
11 the judgment in this case; Great American agreed to release its claims for the remaining part of the
12 judgment against the Changs, to provide other releases, to file a satisfaction ofjudgment in the Great
g 3 13 American Action, and to release its judgment lien in the Chang v. Farmers Action; the Changs
~ PI( 14 agreed to release Great American and Farmers from any further claims involving the Baldwin
(go Avenue Property, or pollution &om the Property; the Changs agreed they would bear responsibility
O ~s16 for any further claims involving the Property that would have been covered by Great American's
17 policies ifthe settlement had not been reached; and the Changs agreed to dismiss this Chang v.
18 Farmers Action and their appeal in this case and to dismiss. (See Baron Decl., at f[ 7;Scher Decl., at
19 f[ 7;Schwartz Decl., at tt 9;Plevin Decl., at f[ 9.)
20 Thus, under the settlement, the Changs are to receive $1 million &om Farmers, and the
21 Changs are to be relieved of the obligation to pay the $ 988,584.49 judgment in the Great American
22 action, subject to the releases and other terms of the settlement agreement.
23 The Changs, Great American, and Farmers reached agreement on the above terms during the
24 settlement conference. (See Baron Decl., at tt 8;Scher Decl., at $ 7; Schwartz Decl., at $ 10.) As
25 noted above, the Fireman's Fund lawyer handling the Changs'laims against Fireman's Fund, Mark
26 Plevin, was not present at the conference, but participated by telephone. (Plevin Decl., $ 7; Baron
27 Decl., $ 5.) During the conference, the Special Master, William Nagle, and Great American's
28 counsel, William Baron, called Plevin and discussed the above terms with him. (Plevin Decl., g 8;
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1 Baron Decl., tt 11.) Plevin stated that he would recommend those terms to his client at Fireman's
2 Fund, but did not have authority to agree to those terms at that time. (Plevin Decl., $ 10.) Thus, the
3 agreement reached at the settlement conference was subject to approval by Fireman's Fund of the
4 negotiated terms, including the terms regarding payment by Fireman's Fund, and subject to approval
5 of specific release terms between Great American and Fireman's Fund —which Great American
6 required as a condition to releasing its judgment lien filed in the Chang v. Farmers Action.
After the settlement terms were reached at the settlement conference, subject to confirmation
8 of the agreement between Fireman's Fund and Great American, Michael Chang and his counsel
(Garrison) appeared on the record, with Special Master Nagle, before The Honorable Steven J.
10 Dylina of the San Mateo County Superior Court, and set out the fact of the settlement and the
11 amount Farmers would pay Chang under the agreement. (See the January 27, 2014 transcript, RJN,
12 Exhibit 1 at pp. 1-7.) Michael Chang testified on the record that he understood the terms of the
3. 13 agreement and that he agreed to the settlement. (Id. at 6:6-7:14.)
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On the record at the settlement hearing, Special Master Nagle explained that the settlement
5 ~ 3I15 was subject to agreement among the insurers of terms concerning the release of Great American's
N816 judgment lien, and advised that "the parties are well on their way to accomplishing that." (Id. at
7:17-26.) Nagle asked Judge Dylina to continue the trial of the Chang v. Farmers Action for one
18 week, to provide time for the insurers to reach agreement on terms for the release of Great
19 American's judgment lien in the Chang v. Farmers Action. (Id.) As noted above, that required
20 agreement by Fireman's Fund as to the terms negotiated at the settlement conference, and required
21 agreement as to wording of the release terms, which Great American required before it would agree
22 to release its judgment lien. (Plevin Decl., $ 10; Baron Decl., f[ 8.) The Superior Court continued
23 the trial of the Chang v.Farmers Action to February 3, 2014. (RJN, Ex. 1, at 7.)
24 Later on January 27, 2014, after the settlement conference had concluded, Fireman's Fund's
25 counsel Plevin spoke by telephone with Great American's counsel Baron. (Plevin Decl., $ 11; Baron
26 Decl., $ 11.) Plevin advised that he had reached his client, and that Fireman's Fund agreed with the
27 terms negotiated at the settlement conference, subject to agreement on wording of a settlement
28 document. (Plevin Decl., $ 11; Baron Decl., tt 11.) Thus, by the end of the day on January 27, 2014,
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1 all parties to the settlement had agreed in principle to the terms negotiated at the settlement
2 conference, subject to agreement on written settlement terms.
In light of the settlement, on January 31, 2007, the Superior Court entered a minute order
4 vacating the February 3, 2014 trial date and noting that "per Special Master BillNagle, the case has
settled." (RJN Ex. 3.) The minute order set an Order to Show Cause for April 29, 2014 as to
6 "dismissal of the entire action." (Id.)
C. The Chants Siuned a Written Settlement Agreement.
At the January 27, 2014 settlement conference, the parties agreed that the terms of the
9 settlement would be incorporated in a written settlement document. (See Baron Decl., at $ 9; Scher
10 Decl., at $ 10; Schwartz Decl., at $ 10.) Great American's counsel agreed to draft a settlement
document reflecting the terms reached by the parties. (Baron Decl., tt 9.)
12 At the settlement conference, the Changs'ounsel asked Great American's counsel to
circulate the draft settlement agreement within two days, so the settlement reached at the conference
could be formalized quickly. (See Baron Decl., at tt10; Scher Decl., at $ 11; Schwartz Decl., at tt
11.) The Changs'ounsel stated that Roxanne Chang was seeking a refinancing loan f'rom Wells
Fargo Bank and that —in order to obtain the loan —the Changs needed the signed settlement
agreement to show Wells Fargo's loan officers that the judgment against the Changs would be
18 satisfied as part of the settlement.'See Baron Decl., at tt10; Scher Decl., at $ 11; Schwartz Decl.,
19 at f[ 11.)
20 Great American's counsel sent a draft settlement document to counsel for the Changs,
21 Farmers, and Fireman's Fund, on January 31, 2014. (Baron Decl., at f[ 12; Ex. 1 to Scher Decl.)
22 That document stated the material terms of the agreement reached at the settlement conference,
23 including the amounts to be paid, the releases to be provided, the dismissals and satisfaction of the
24 judgment that would follow, among other terms. (See Ex. 1to Scher Decl.)
25 Michael Chang and Roxanne Chang each signed that proposed settlement agreement by
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'arrison had previously forwarded an email &om a Wells Fargo Bank loan officer, stating that the
27 bank was processing a refinancing loan application concerning Crescent Square Shopping Center in
Milpitas, that Roxanne Chang was one of the two main sponsors of the loan, and that the existence
28 of the judgment against the Changs in this case "willpresent challenges in the approval of this loan."
(Ex. 1to Baron Decl.)
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February 4, 2014. (Exhibit 2 to Scher Decl.) On that day, Carol Erdie from the Garrison Law Firm
2 (the Changs'ounsel) sent Great American's counsel an email attaching the settlement document
signed by both Michael Chang and Roxanne Chang. (See Baron Decl., at $ 13; Ex. 3 to Scher Decl.)
4 That draft settlement document signed by the Changs contains all the material terms of the parties'
settlement. (See Exhibit 1 to Scher Decl.) The Changs thus acknowledged that they agreed to the
6 terms of the settlement negotiated at the settlement conference and set out in the document they
signed.
Although the draft document signed by the Changs contains blank spaces for fillingin certain
9 non-material details —the policy numbers of Farmers and Fireman's Fund's policies, the case
10 number of the Chang v. Farmers Action, and the addresses of the parties'ounsel —the absence of
11 that information is not material to the agreement. (See Ex. 1 to Scher Decl., at 4, 8-9, 19-20.) For
12 example, the absence of Farmers and Fireman's Fund policy numbers is not material, because the
g 8 13 document expressly provides that the releases under the settlement apply to all policies issued by
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a, Ih.
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Ng-F14 those insurers. (See id. at page 8, $ l.g. and page 9, $ I.i.)
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D. The Changs Presented the Signed Settlement Agreement to Wells Fargo Bank.
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14 DATED: April 25, 2014 WOOLLS & PEER
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A Professional Corporation
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8 JOHN E. PEER
Attorneys for Defendants
FARMERS INSURANCE EXCHANGE and
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GREGORY B. SCHER - State Bar No. 137228 JOHN E. PEER — State Bar No. 95978 KATYA. NELSON - State Bar No. 173759 WOOLLS 4 PEER A Professional One Corporation Wilshire Boulevard, Los Angeles, 22" California 90017 Floor FILED SAN MATEO COUblTY 4 Telephone: (213) 629-1600 Facsimile: (213) 629-1660 APR 2 9 2014 5 Attorneys for Defendants e'p Ir 6 FARMERS INSURANCE EXCHANGE and Il TRUCK INSURANCE EXCHANGE ofpUTV GLERK 7 SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF SAN MATEO, CENTRAL BRANCH 10 11 MICHAELCHANG, an individual, Case No.: CIV 489065 12 Plaintiff, NOTICE OF MOTION AND MOTION TO g 8 13 ENFORCE SETTLEMENT AGREEMENT AND ENTER JUDGMENT PURSUANT a Ii> It --14 FARMERS INSI.JRANCE COMPANY, INC., et CODE OF CIVILPROCEDURE SECTION al., 664.6 gJ Pgo Defendants. Date: June 3, 2014 Time: 9:00 a.m. 0 <88 16 Dept.: 7 O 17 Complaint Filed: October 28, 2009 18 19 TO ALLPARTIES AND TO THEIR COUNSEL OF RECORD: 20 PLEASE TAKE NOTICE on June 3,2014 at 9:00 a.m. or as soon thereafter as the matter 21 may be heard, before The Honorable Steven L. Dylina, in Dept. 7 of the Superior Court of the 22 County of San Mateo, located at 400 County Center, Redwood City, CA 94063, defendants Farmers 23 Insurance Exchange and Truck Insurance Exchange (collectively, "Farmers" ), by and through their 24 attorneys of record, will and hereby do move the Court for an order pursuant to Code of Civil 25 Procedure section 664.6 enforcing the settlement agreement the parties reached in this action and 26 entering judgment pursuant to that agreement. 27 This Motion will be and is based: on this Notice, the Memorandum of Points and Authorities, 28 the accompanying Declarations of Gregory B. Scher, William J. Baron, Arthur Schwarz, Mark D. PRINTED ON RECYCLED PAPER 1 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984. I Plevin and Catherine M. Zacharias, the exhibits to those declarations, the accompanying Request for Judicial Notice and exhibits thereto, all of the pleadings and papers on file in this action, all matters on which the Court may take judicial notice and such other matters as may be presented to the Court 4 at or before the hearing on this Motion. STATEMENT OF RELIEF SOUGHT On the record and in open court on January 27, 2014, plaintiffs reached a settlement with defendants and other insurers from which the plaintiffs also claim insurance benefits. A week later 8 the Changs signed a written agreement which included all the material terms of the settlement. The 9 settlement resolves all issues presented in this action and in two related actions. 10 Plaintiffs are now attempting to repudiate the settlement. By this motion, Farmers seeks an order enforcing the settlement agreement plaintiffs agreed to on the record and in written form. 12 DATED: April 25, 2014 WOOLLS & PEER y A Professional Corporation >816 E. PEER 0 A orneys for Defendants 17 ARMERS INSURANCE EXCHANGE and TRUCK INSI.JRANCE EXCHANGE 18 19 20 21 22 23 24 25 26 27 28 PRINTED ON RECYCLED PAPER 2 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 TABLE OF CONTENTS Paae I. INTRODUCTION 3 II. STATEMENT OF FACTS 4 A. Farmers Issued Policies to Michael Chang for Policy Periods During 1990- 2013. B. The Changs, Great American, Farmers, and Fireman's Fund Reached a Settlement of the Various Claims Among Them C. The Changs Signed a Written Settlement Agreement. D. The Changs Presented the Signed Settlement Agreement to Wells Fargo Bank,.... 10 and Advised the Bank that they had Entered into the Settlement. E. The Changs Now Seek to Repudiate the Settlement. 10 12 F. Great American, Farmers, and Fireman's Fund Have Each Signed the ... g 3 13 Settlement Document Signed by the Changs. ~ 5g)14 x (g~ 15 111 ARGUMENT 12 A. The Court Should Rule That the Changs are Bound by the Terms of the .... ....... 1 2 Settlement Agreement They Signed. 12 18 B. The Court Should Rule that the Precluded &om Disavowing Changs are The ..... 14 19 Settlement Agreement 14 20 1. The Changs Confirmed the Settlement Agreement by their Conduct....... 14 21 2. The Court Should Rule that the Changs are Equitably Estopped .... 22 From Disavowing The Settlement Agreement. ....15 23 3. The Court Should Rule that the Changs are Judicially Estopped From ... ....16 24 Disavowing The Settlement Agreement. ....16 25 IV. CONCLUSION. ....17 27 28 PRINTED ON REC YCLED PAPER 1 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 TABLE OF AUTHORITIES Pa@et'sl CASES 3 Blix Street Records, Inc. v. Cassidy, 4 191 Cal.App.4th 39 (2010) ...3, 15, 16, 17 Corklan v.Boscoe, 156 Cal.App.3d 989 (1984) . ...13 Crestview Cemetery Assn. v. Dieden 54 Cal.2d 744 (1960) 14 8 Eustace v. Lynch, 43 Cal.App.2d 486 (1941) ...3,15 Gopal v. Yoshikawa, 10 147 Cal.App.3d 128 (1983) ...13 Kohn v. Jaymar-Ruby, Inc., 23 Cal.App.4th 1530 (1994) . ...13 12 Southern Calif. Edison Co. v. Superior Court g ). 13 37 Cal.App.4th 839 (1995) . 14 a1)j14 Youngman v. Nevada Irrigation Dist. ~ 70 Cal.2d 240(1969) ...15 STATUTES 8 ~ Code of Civil Procedure section 664.6.). ...3, 12 OTHER AUTHOMTIES 18 Witkin, Summary of California Law, 10th Ed., Contracts $ 749 .. ...14 20 21 22 23 24 25 26 27 28 PRINTED ON RECYCLED PAPER 11 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 MEMORANDUMOF POINTS AND AUTHORITIES I. INTRODUCTION This case involves insurance coverage disputes arising from underlying claims and litigation 4 concerning contaminated property owned by plaintiffMichael Chang. (See Complaint, attached to Request For Judicial Notice ("RJN") as Ex. 4.) In addition to this lawsuit, plaintiffMichael Chang and his former wife Roxanne Chang have 7 concurrently been involved in two additional, related lawsuits: (1) the underlying action, entitled 8 Bilal Kartal v. Michael Chang, et al., San Mateo County Superior Court, Case No. CIV 458146 (the 9 "Kartal Action"), and (2) separate coverage litigation with Great American Insurance Company 10 ("Great American" ), entitled Great American Insurance Company, etc. v. Michael Chang, etc., United States District Court case number 3:12 CV-00833-SC (the "Great American Action"), in which Great American sought declaratory relief and reimbursement of expenses it incurred in 8 13 defending Changs against the claims asserted against Changs and others in the Kartal Action. (See g 8 I Declaration of Gregory B. Scher submitted in support of this motion ("Scher Decl."), at tt 2; Declaration of Arthur Schwartz in support of this motion ("Schwartz Decl."), at $ f[ 2-4); and g I.e- Declaration of William J. Baron in support of this motion ("Baron Dec."), at $ 1.) 17 This lawsuit was set for trial on January 27, 2014. On that day, the Court held a settlement 18 conference jointly in this case and in the Kartal Action. Michael Chang attended the settlement 19 conference, as did the other parties in the Kartal Action, as well as Farmers, Great American, and 20 Fireman's Fund Insurance Company, which had issued insurance policies to other parties in the Kartal Action. (Scher Decl., at f[$ 4 and 6; Schwartz Decl., at $ 6; Declaration of Mark D. Plevin in support of this motion ("Plevin Decl."), at f[ 6; Declaration of William Baron in support of this 23 motion ("Baron Decl."), at tt 4.) 24 At the settlement conference, the parties and insurers reached agreement on two settlements. One settlement, which resolved the claims in the Kartal Action, is not pertinent here. Of concern here, the Changs, Great American, Farmers, and Fireman's Fund agreed on terms of a settlement that 27 (1) resolved all the claims and issues between the Changs and Great American in the Great 28 American Action, (2) resolved all the claims and issues between the Changs and Farmers in this PRlNTED ON RECYCLED PAPER 1 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 1 action, and (3) resolved the Changs'laims that Farmers and Fireman's Fund owed a duty to defend 2 the Changs in the underlying claims, and that those insurers should pay defense expenses the Changs 3 were ordered to reimburse Great American under the judgment in that case. (See Baron Decl., at $ 6; 4 Scher Decl., at g 7; and Schwartz Decl., at tt tt 8, 9.) After the settlement terms were reached at the settlement conference, Michael Chang and his 6 counsel appeared on the record before The Honorable Steven L. Dylina. Michael Chang, his counsel, and the Special Master in the Kartal Action (William Nagle, who also acted as mediator in 8 this action) set out the fact of the settlement and certain basic terms of the agreement on the record. 9 (See the transcript from the January 27, 2014 settlement conference, Exhibit 1 to the Request for 10 Judicial Notice accompanying this Motion ("RJN"), at p. 5.) Based on the settlement, the Superior Court continued the trial date in this action. (Ex. 3 to RJN.) 12 At the settlement conference, the parties agreed that the terms of the settlement would be 8 13 incorporated in a written settlement document. (See Scher Decl., at f[ 10; Baron Decl., at f[ 9; m -~14 Schwartz Decl., at f[ 10; Scher Decl., at f[ 10.) Great American's counsel agreed to draft a X settlement document reflecting the terms reached by the parties. (Baron Decl., f[ 9.) At the settlement conference, the Changs'ounsel urged Great American's counsel to circulate the draft 17 settlement agreement as soon as possible, so the written settlement document could be finalized 18 quickly. (See Baron Decl., at $ 10; Scher Decl., at $ 11; Schwartz Decl., at $ 11.) The Changs'ounsel stated that Roxanne Chang was seeking a refinancing loan &om Wells Fargo Bank, and that 20 —in order to obtain the loan —the Changs needed the signed settlement agreement to show Wells 21 Fargo's loan officers that the judgment against the Changs in this case would be satisfied as part of 22 the settlement. (See Baron Decl., at tt10; Scher Decl., at f[ 11; Schwartz Decl., at $ 11.) 23 Great American's counsel sent a draft settlement document to counsel for the Changs, 24 Farmers, and Fireman's Fund, on January 31, 2014. (Baron Decl., at f[ 12; Ex. 1 to Scher Decl.) 25 That document set out all the material terms of the agreement reached at the settlement conference, 26 including the amounts to be paid, the releases to be provided, the dismissals and satisfaction of the 27 judgment that would follow, among other terms. (Baron Decl., at f[ 13; Scher Decl., at $ 15; Ex. 1 to 28 Scher Decl.) PRINTED ON RECYCLED PAPER 2 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 Michael Chang and Roxanne Chang each signed that proposed settlement agreement by 2 February 4, 2014. (Scher Decl., at f[ 15; Ex. 2 to Scher Decl.) On that day, Carol Erdie from the Garrison Law Firm (the Changs'ounsel) sent Great American's counsel an email attaching the 4 settlement document signed by both Michael Chang and Roxanne Chang. (Scher Decl., at $ 15; Ex. 5 3 to Scher Decl.) The Changs thus acknowledged that they agreed to the terms of the settlement 6 negotiated at the settlement conference and set out in the document they signed. In addition, the Changs presented the settlement agreement they signed to a loan officer at 8 Wells Fargo Bank, and based on that settlement were able to get a loan funded. (Baron Decl., at f 9 10; Schwartz Decl., at $ 11.) After receiving the settlement agreement signed by the Changs, and 10 the Changs'epresentation that a settlement had been reached, Wells Fargo issued the refinancing 11 loan. (See Ex. 3 to Baron Decl.) 12 Now, however, the Changs refuse to acknowledge the settlement. Although the Changs each signed a document stating the material terms of the settlement agreement —and the Changs represented to Wells Fargo Bank that they had reached a settlement, in order to obtain a loan- r the Changs now seek to repudiate the settlement. I 8 ~ Farmers asks the Court to enforce the settlement agreement the Changs signed, which 17 Farmers, Great American, and Fireman's Fund have all signed as well. (Ex. 4 to Scher Decl.) 18 Where, as here, parties have agreed to terms of a settlement, it is well settled that a court has the 19 inherent power to enforce summarily an agreement to settle a case pending before it and enter 20 judgment pursuant to the terms of the settlement. (Code of Civil Procedure section 664.6.) 21 Moreover, the Court should rule that the Changs are precluded from denying they entered 22 into the settlement agreement. The Changs'epudiation of the settlement agreement they signed is inconsistent with their representations to the San Mateo Superior Court and to Wells Fargo Bank that 24 they had entered into the settlement. The Changs should not be allowed to walk away from the 25 settlement they signed —particularly after they obtained benefits by representing to others that they 26 had, in fact, reached the settlement agreement. See Blix Street Records, Inc. v. Cassidy, 191 27 Cal.App.4th 39, 45-46, 50-51 (2010); Eustace v. Lynch, 43 Cal.App.2d 486, 490-491 (1941). 28 SSi PRINTED ON RECYCLED PAPER 3 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 H. STATEMENT OF FACTS 1 A. Farmers Issued Policies to Michael Chana for Policv Periods During 1990-2013. The general background of the underlying claims is as follows. During 1977 Michael Chang 4 and Roxanne Chang acquired real property located on Baldwin Avenue in San Mateo, California (the "Property" ) and a dry cleaning business already located at the Property. Michael Chang operated the dry cleaners until 1981, when he sold the business, although he continues to own the Property. In 2009, Michael Chang filed this coverage litigation against Farmers (the Chang v.Farmers 9 Action), claiming that Farmers owed a duty to defend the Kartal Action under a policy Farmers had 1p issued to the Changs, and renewals of that policy. (RJN, Ex. 4 [Complaint.]) Chang sought a declaration that Farmers had a duty to defend, and sought damages because Farmers had initially disclaimed a defense obligation. (Id.) II- 13 The Changs also claimed entitlement to coverage as additional insureds under policies that l4 14 Fireman's Fund issued to Christopher Chang, who was the Changs'enant at the Property after he 5 m>j 15 purchased the Sunrise Cleaners dry cleaning business in 1981. (Plevin Decl., at $ 2.) The Changs claimed that Fireman's Fund was obligated to defend them against government orders to address O 17 pollution at Baldwin Avenue. (Id.) 18 Both Farmers and Fireman's Fund initially declined to defend the Changs. By 2013, 19 however, Farmers had agreed to defend the Changs in the Kartal Action, under a full reservation of 2p rights, and Fireman's Fund had agreed to defend the Changs against government pollution orders concerning the property, subject to a full reservation of rights. (Scher Decl., at f[ 2; Plevin Decl., at tt 22 3.) 23 The District Court in the Great American action ruled that Great American had no duty to 24 defend or indemnify the Changs in any matters relating to the pollution at the property, and that the Changs must reimburse Great American for the defense expenses it had advanced. The Changs then claimed Farmers and Fireman's Fund were obligated to pay such reimbursement on the Changs'7 behalf. (Schwartz Decl., at tr4; Plevin Decl., at tt 4.) Specifically, the Changs asserted that Farmers 28 must pay the amounts Great American had advanced for the Kartal Action, and argued that PRINTED ON RECYCLED PAPER 4 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 Fireman's Fund must pay amounts Great American had advanced for site investigation at the 2 Property. (Schwartz Decl. at $ 4; Plevin Decl., at tt 4.) Great American asked Farmers and Fireman's Fund to pay a portion of the claimed amounts. (Id.) B. The Chants. Great American. Farmers. and Fireman's Fund Reached a Settlement of the Various Claims Among Them. The Special Master in the Kartal Action, William Nagle, had held a number of settlement 7 conferences and settlement meetings concerning the claims in these cases. (Baron Decl., at f[ 2.) 8 The prior settlement discussions with Mr. Nagle also had included the issues raised in the Chang v. 9 Farmers Action, the Changs'laims against Fireman's Fund, and the Changs'laims against Great American. (Scher Decl., at $ 3; Schwartz Decl. at $ 5; Plevin Decl., at f[ 5.) After several continuances of the trial date, the trial in the Chang v.Farmers Action was set 12 for Monday, January 27, 2014. (Scher Decl., at $ 4.) The San Mateo County Superior Court set a settlement conference before trial that day. (Id.) The parties had filed motions in limine, and Farmers'ounsel expected and was prepared to begin trial ifthe case was not resolved at the settlement conference. (Id. at tt 5). This court ordered all of the parties to a settlement conference on the morning trial of the Chang v. Farmers trial was scheduled to commence. The January 27, 2014 settlement conference 18 was held in both the Chang v. Farmers Action and the Kartal Action. (Scher Decl., at $ 4.) The 19 participants at the settlement conference included Michael Chang, his counsel and consultant 20 (Garrison, Kalfen, and Kelleher), the other parties in the Kartal Action, and counsel for Great 21 American, Farmers, and Fireman's Fund. (Scher Decl., at f[ 6;Schwartz Decl., at f[ 7;Baron Decl. at 22 tt 5.) The lawyer for Fireman's Fund with respect to the Changs'nsurance coverage claims in this 23 matter was not present, but had agreed to be available to participate by telephone. (Plevin Decl. at 24 $ 7; Baron Decl. at f[ 5.) 25 On the day of the settlement conference, the parties and insurers reached agreement on two 26 settlements. The parties in the Kartal Action reached a settlement of the claims in that case. 27 (Schwartz Decl., at tt 8;RJN, Ex. 1 at pp.9-18.) In addition, the Changs, Great American, Farmers, 28 and Fireman's Fund agreed on the material terms of a settlement that resolved the claims and issues PRINTED ON RECYCLED PAPER 5 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 1 between the Changs and Great American, the claims and issues between the Changs and Farmers, 2 and the claims that Farmers and Fireman's Fund owed a duty to pay the defense expenses the 3 Changs were ordered to reimburse Great American in this case. (See Baron Decl., at tttt 6-8;Scher 4 Decl., at /[7; Schwartz Decl., at)9; Plevin Decl., at)11.) The material terms negotiated between the Changs, Great American, Farmers, and Fireman's 6 Fund on the day of the settlement conference included the settlement payments among the parties, 7 the releases among the parties, satisfaction of the judgment Great American had obtained against the 8 Changs, among other terms. (See Baron Decl., at $ 7; Scher Decl., at $ 7; Schwartz Decl., at $ 9; 9 Plevin Decl., at g 8-9.) Specifically, Farmers agreed to pay the Changs $1 million; Farmers and 10 Fireman's Fund each agreed to pay Great American part of the amount owed by the Changs under 11 the judgment in this case; Great American agreed to release its claims for the remaining part of the 12 judgment against the Changs, to provide other releases, to file a satisfaction ofjudgment in the Great g 3 13 American Action, and to release its judgment lien in the Chang v. Farmers Action; the Changs ~ PI( 14 agreed to release Great American and Farmers from any further claims involving the Baldwin (go Avenue Property, or pollution &om the Property; the Changs agreed they would bear responsibility O ~s16 for any further claims involving the Property that would have been covered by Great American's 17 policies ifthe settlement had not been reached; and the Changs agreed to dismiss this Chang v. 18 Farmers Action and their appeal in this case and to dismiss. (See Baron Decl., at f[ 7;Scher Decl., at 19 f[ 7;Schwartz Decl., at tt 9;Plevin Decl., at f[ 9.) 20 Thus, under the settlement, the Changs are to receive $1 million &om Farmers, and the 21 Changs are to be relieved of the obligation to pay the $ 988,584.49 judgment in the Great American 22 action, subject to the releases and other terms of the settlement agreement. 23 The Changs, Great American, and Farmers reached agreement on the above terms during the 24 settlement conference. (See Baron Decl., at tt 8;Scher Decl., at $ 7; Schwartz Decl., at $ 10.) As 25 noted above, the Fireman's Fund lawyer handling the Changs'laims against Fireman's Fund, Mark 26 Plevin, was not present at the conference, but participated by telephone. (Plevin Decl., $ 7; Baron 27 Decl., $ 5.) During the conference, the Special Master, William Nagle, and Great American's 28 counsel, William Baron, called Plevin and discussed the above terms with him. (Plevin Decl., g 8; PRINTED ON REC YCI.ED PAPER 6 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984. I 1 Baron Decl., tt 11.) Plevin stated that he would recommend those terms to his client at Fireman's 2 Fund, but did not have authority to agree to those terms at that time. (Plevin Decl., $ 10.) Thus, the 3 agreement reached at the settlement conference was subject to approval by Fireman's Fund of the 4 negotiated terms, including the terms regarding payment by Fireman's Fund, and subject to approval 5 of specific release terms between Great American and Fireman's Fund —which Great American 6 required as a condition to releasing its judgment lien filed in the Chang v. Farmers Action. After the settlement terms were reached at the settlement conference, subject to confirmation 8 of the agreement between Fireman's Fund and Great American, Michael Chang and his counsel (Garrison) appeared on the record, with Special Master Nagle, before The Honorable Steven J. 10 Dylina of the San Mateo County Superior Court, and set out the fact of the settlement and the 11 amount Farmers would pay Chang under the agreement. (See the January 27, 2014 transcript, RJN, 12 Exhibit 1 at pp. 1-7.) Michael Chang testified on the record that he understood the terms of the 3. 13 agreement and that he agreed to the settlement. (Id. at 6:6-7:14.) g,o ~ p'i4 N On the record at the settlement hearing, Special Master Nagle explained that the settlement 5 ~ 3I15 was subject to agreement among the insurers of terms concerning the release of Great American's N816 judgment lien, and advised that "the parties are well on their way to accomplishing that." (Id. at 7:17-26.) Nagle asked Judge Dylina to continue the trial of the Chang v. Farmers Action for one 18 week, to provide time for the insurers to reach agreement on terms for the release of Great 19 American's judgment lien in the Chang v. Farmers Action. (Id.) As noted above, that required 20 agreement by Fireman's Fund as to the terms negotiated at the settlement conference, and required 21 agreement as to wording of the release terms, which Great American required before it would agree 22 to release its judgment lien. (Plevin Decl., $ 10; Baron Decl., f[ 8.) The Superior Court continued 23 the trial of the Chang v.Farmers Action to February 3, 2014. (RJN, Ex. 1, at 7.) 24 Later on January 27, 2014, after the settlement conference had concluded, Fireman's Fund's 25 counsel Plevin spoke by telephone with Great American's counsel Baron. (Plevin Decl., $ 11; Baron 26 Decl., $ 11.) Plevin advised that he had reached his client, and that Fireman's Fund agreed with the 27 terms negotiated at the settlement conference, subject to agreement on wording of a settlement 28 document. (Plevin Decl., $ 11; Baron Decl., tt 11.) Thus, by the end of the day on January 27, 2014, PRINTED ON RECYCLED PAPER 7 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 1 all parties to the settlement had agreed in principle to the terms negotiated at the settlement 2 conference, subject to agreement on written settlement terms. In light of the settlement, on January 31, 2007, the Superior Court entered a minute order 4 vacating the February 3, 2014 trial date and noting that "per Special Master BillNagle, the case has settled." (RJN Ex. 3.) The minute order set an Order to Show Cause for April 29, 2014 as to 6 "dismissal of the entire action." (Id.) C. The Chants Siuned a Written Settlement Agreement. At the January 27, 2014 settlement conference, the parties agreed that the terms of the 9 settlement would be incorporated in a written settlement document. (See Baron Decl., at $ 9; Scher 10 Decl., at $ 10; Schwartz Decl., at $ 10.) Great American's counsel agreed to draft a settlement document reflecting the terms reached by the parties. (Baron Decl., tt 9.) 12 At the settlement conference, the Changs'ounsel asked Great American's counsel to circulate the draft settlement agreement within two days, so the settlement reached at the conference could be formalized quickly. (See Baron Decl., at tt10; Scher Decl., at $ 11; Schwartz Decl., at tt 11.) The Changs'ounsel stated that Roxanne Chang was seeking a refinancing loan f'rom Wells Fargo Bank and that —in order to obtain the loan —the Changs needed the signed settlement agreement to show Wells Fargo's loan officers that the judgment against the Changs would be 18 satisfied as part of the settlement.'See Baron Decl., at tt10; Scher Decl., at $ 11; Schwartz Decl., 19 at f[ 11.) 20 Great American's counsel sent a draft settlement document to counsel for the Changs, 21 Farmers, and Fireman's Fund, on January 31, 2014. (Baron Decl., at f[ 12; Ex. 1 to Scher Decl.) 22 That document stated the material terms of the agreement reached at the settlement conference, 23 including the amounts to be paid, the releases to be provided, the dismissals and satisfaction of the 24 judgment that would follow, among other terms. (See Ex. 1to Scher Decl.) 25 Michael Chang and Roxanne Chang each signed that proposed settlement agreement by 26 'arrison had previously forwarded an email &om a Wells Fargo Bank loan officer, stating that the 27 bank was processing a refinancing loan application concerning Crescent Square Shopping Center in Milpitas, that Roxanne Chang was one of the two main sponsors of the loan, and that the existence 28 of the judgment against the Changs in this case "willpresent challenges in the approval of this loan." (Ex. 1to Baron Decl.) PRINTED ON RECYCLED PAPER 8 NOTICE AND MOTION TO ENFORCE SETTLEMENT AGREEMENT 387984.1 February 4, 2014. (Exhibit 2 to Scher Decl.) On that day, Carol Erdie from the Garrison Law Firm 2 (the Changs'ounsel) sent Great American's counsel an email attaching the settlement document signed by both Michael Chang and Roxanne Chang. (See Baron Decl., at $ 13; Ex. 3 to Scher Decl.) 4 That draft settlement document signed by the Changs contains all the material terms of the parties' settlement. (See Exhibit 1 to Scher Decl.) The Changs thus acknowledged that they agreed to the 6 terms of the settlement negotiated at the settlement conference and set out in the document they signed. Although the draft document signed by the Changs contains blank spaces for fillingin certain 9 non-material details —the policy numbers of Farmers and Fireman's Fund's policies, the case 10 number of the Chang v. Farmers Action, and the addresses of the parties'ounsel —the absence of 11 that information is not material to the agreement. (See Ex. 1 to Scher Decl., at 4, 8-9, 19-20.) For 12 example, the absence of Farmers and Fireman's Fund policy numbers is not material, because the g 8 13 document expressly provides that the releases under the settlement apply to all policies issued by li1 a, Ih. .8 y Ng-F14 those insurers. (See id. at page 8, $ l.g. and page 9, $ I.i.) ~ X D. The Changs Presented the Signed Settlement Agreement to Wells Fargo Bank. 0 h 14 DATED: April 25, 2014 WOOLLS & PEER x I:~ RP) g 15 A Professional Corporation >: 16 8 JOHN E. PEER Attorneys for Defendants FARMERS INSURANCE EXCHANGE and 18 TRUCK INSI.JRANCE EXCHANGE 19 20 21 22 23 24 25 26 27 28 PRINTED ON REC YCLED PAPER 17 NOTICE AND MOTION TO ENFORCE SETTI.EMENT AGREEMENT 387984.I