Code of Civil Procedure section 664.6 allows a court to enter judgment according to a settlement’s terms “[i]f parties to pending litigation stipulate, in a writing signed by the parties outside the presence of the court or orally before the court” to the settlement. “[T]he parties” can then request that the court retain jurisdiction to enforce the settlement.
Twenty-five years ago, in Levy v. Superior Court (1995) 10 Cal.4th 578, a 6-1 Supreme Court interpreted section 664.6 as requiring the parties themselves, not just the parties’ counsel, to sign a written stipulation as a prerequisite to court enforcement. The Legislature might be changing that rule, at least somewhat.
Senate Bill 1105 would allow “the parties or their counsel” (emphasis added) to stipulate to a dismissal of the case without prejudice and to the court’s retention of jurisdiction to enforce the settlement.
The Levy court explained the policy reasons for its rule: “The litigants’ direct participation tends to ensure that the settlement is the result of their mature reflection and deliberate assent. This protects the parties against hasty and improvident settlement agreements by impressing upon them the seriousness and finality of the decision to settle, and minimizes the possibility of conflicting interpretations of the settlement.” (Levy, 10 Cal.4th at p. 585.)
A Senate floor analysis of SB 1105 says, “The virtues [of the rule] outlined by the Supreme Court notwithstanding, the author and the sponsor, the California Judges Association, now seek to streamline this process in order to meet the goals of efficiency and economy.”
The analysis reports that the bill “eliminates the requirement that parties themselves must personally sign or orally stipulate to these settlements and instead allows counsel for the parties to so stipulate on their behalf.” The current language of the bill doesn’t seem to go that far, however.
Unchanged is the part of the statute, interpreted in Levy, requiring “parties” to stipulate in writing or orally in court for judgment to be entered. What the bill does do is add a provision allowing “the parties or their counsel” to “further stipulate” (emphases added) to the without-prejudice dismissal and to the court’s retention of jurisdiction.
The Senate passed SB 1105 earlier this month. The bill is now pending in the Assembly’s Judiciary Committee. (See here.)
