Premium Commercial Services Corp. v. National Bank

Cal.3d 273 , 280 [ 204 Cal.Rptr. 143 , 682 P.2d 338 ]) and held that “[permitting the court to unravel such agreements based on mistake or evidence of no intent, as the trial court did here, would contravene the policy objectives of section 998.” (Pazderka v. Caballeros Dimas Alang, Inc., supra, 62 Cal.App.4th at p. 671.) Pazderka ended with the observation that “Our conclusion is consistent with the Supreme Court’s holding that a ‘ “valid compromise agreement has many attributes of a judgment, and in the absence of a showing of fraud or undue influence is decisive of the rights of the parties thereto and operates as a bar to the reopening of the original controversy.” [Citation.]’ (Folsom v. Butte County Assn. of Governments (1982) 32 Cal.3d 668 , 677 [ 186 Cal.Rptr. 589 , 652 P.2d 437 ].) Here, there is no evidence of fraud or undue influence; thus, the court abused its discretion in vacating the judgment and granting rescission.” (Pazderka, supra, at p. 672.)

The Bank does not argue that Pazderka was wrongly decided, or that it is inapplicable to this case. Instead, the Bank argues that Premium cannot raise this issue on appeal, having failed to seek writ review of the trial court order setting aside the settlement. In support, the Bank cites Reid v. Balter (1993) 14 Cal.App.4th 1186 [ 18 Cal.Rptr.2d 287 ], which concerned a party’s failure to seek writ review of a trial court order denying a motion to dismiss for failure to prosecute. The Bank argues that the facts here are analogous to those in Reid, and that for the policy reasons cited in that case, we should find waiver here.

In Reid, the plaintiffs’ case was dismissed when they failed to attend a status conference. Sixteen months later, the plaintiffs moved to set the dismissal aside. The trial court granted the motion. The defendants then filed a motion to dismiss based on lack of prosecution. That motion was denied. The case proceeded to trial and the plaintiffs obtained a judgment. The defendants appealed, contending that the dismissal should not have been set aside and that their motion to dismiss should have been granted. The Court of Appeal found that the original dismissal order was void, since the plaintiffs had not had notice, and that the defendants had not made a showing that they were prejudiced by the denial of their motion to dismiss for lack of prosecution. (14 Cal.App.4th at p. 1195.)

The court then found an additional reason, based on “a strong public policy,” to deny relief to the defendants: the defendants had not sought pretrial review of the order denying their motion to dismiss for lack of prosecution, but had let the case proceed to trial, “thereby expending the trial court’s, the plaintiffs’, and their own resources in both trial and posttrial

proceedings, proceedings which defendants now contend should never have taken place. [^] While the discretionary dismissal statute was enacted for the benefit of defendants named in lawsuits, it was also enacted for the public’s benefit, i.e., to expedite the administration of justice by declogging court calendars and putting an end to elderly cases. [Citation.] By letting this case proceed to trial instead of petitioning for mandamus relief when their motion to dismiss was denied, defendants thwarted both purposes of the statute. It was counterproductive to wait until after the case had proceeded to trial and judgment to request review of the order denying dismissal. As defendants failed to seek a pretrial resolution of the dismissal issue, we are not inclined to now disturb plaintiffs’ victory on the merits.” (14 Cal.App.4th at pp. 1195-1196, italics omitted.) We cannot adopt Reids reasoning here.

First, Reid seems to assume that a party which seeks writ review will invariably receive a speedy result on the merits. The contrary is true: “Approximately 90 percent of petitions seeking extraordinary relief are denied.” (Omaha Indemnity Co. v. Superior Court (1989) 209 Cal.App.3d 1266 , 1271 [ 258 Cal.Rptr. 66 ]; Science Applications Internal Corp. v. Superior Court (1995) 39 Cal.App.4th 1095 , 1100 [ 46 Cal.Rptr.2d 332 ] [“We deny the vast majority of petitions we see and we rarely explain why.”].) This is so because “. . . courts will not use their scarce resources to second-guess every ruling and order of the trial court,” (Omaha Indemnity, supra, at p. 1272) and because the too easy grant of writ relief “would interfere with an orderly administration of justice at the trial and appellate levels. Reviewing courts have been cautioned to guard against the tendency to take ‘ “. . . too lax a view of the ‘extraordinary’ nature of prerogative writs . . .” ’ (8 Witkin, supra, at § 141, pp. 782-783) lest they run the risk of fostering the delay of trials, vexing litigants and trial courts with multiple proceedings, and adding to the delay of judgment appeals pending in the appellate court. (Babb v. Superior Court (1971) 3 Cal.3d 841 , 851 [ 92 Cal.Rptr. 179 , 479 P.2d 379 ]; Agassiz v. Superior Court (1891) 90 Cal. 101 , 103-104 [ 27 P. 49 ]; Burrus v. Municipal Court (1973) 36 Cal.App.3d 233 , 236 [ 111 Cal.Rptr. 539 ].)” (Ibid.) Thus, if Premium had petitioned for writ review of the trial court order setting aside the settlement, as the Bank contends it should have, the petition might well have been in vain, leaving both us and the parties in the situation we are in today, that is, in an appeal of the ruling.

More importantly, although Reid would require a party dissatisfied with a trial court ruling to seek writ review as a prerequisite to appeal, we do not believe that appellate courts may impose such a condition where the Legislature has not seen fit to do so.

The Legislature has determined that on appeal, “. . . the reviewing court may review the verdict or decision and any intermediate ruling, proceeding,

order or decision which involves the merits or necessarily affects the judgment or order appealed from or which substantially affects the rights of a party . . . (§ 906; see Oskooi v. Fountain Valley Regional Hospital (1996) 42 Cal.App.4th 233 , 237, fn. 4 [ 49 Cal.Rptr.2d 769 ] (lead opn.) [Reid “cannot be read to divest the trial court of its legislatively granted jurisdiction.”].) The order setting aside the section 998 settlement in this case is such an order. It affects the judgment and the rights of a party. Where the Legislature has determined that public policy demands that writ review be sought before an appeal may be taken, the Legislature has so required. Such a requirement has been imposed, for example, in some circumstances in dependency cases. (Welf. & Inst. Code, § 366.26, subd, (/).)

Since no statute required Premium to seek writ review of the trial court ruling at issue as a prerequisite to appeal, and since there is no persuasive authority to that effect, we find that the trial court order setting aside the section 998 settlement may properly be raised on this appeal.

Disposition

The trial court orders granting judgment notwithstanding the verdict and new trial are reversed. The matter is remanded to the trial court with directions to enter judgment in favor of Premium in the amount of the section 998 offer, $201,000. Premium is to recover costs on appeal.

Turner, P. L, and Grignon, L, concurred.

Respondent’s petition for review by the Supreme Court was denied September 22, 1999.