Opinion
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
APPEAL from a judgment of the Superior Court of Fresno County. No. 04CECG02775 R. L. Putnam, Judge.
William M. Krieg & Associates, William M. Krieg and Eric M. Kapigian for Plaintiffs and Appellants.
Betts & Wright, James B. Betts and Joseph D. Rubin for Defendant and Respondent.
OPINION
DAWSON, J.
Plaintiffs bought a used motor home from defendant and were misinformed about its mileage. In 1999, plaintiffs filed suit on behalf of themselves and the general public pursuant to California’s Unfair Competition Law (UCL) (Bus. & Prof. Code, § 17200 et seq.). A settlement was reached and plaintiffs dismissed their lawsuit in its entirety with prejudice. Plaintiffs received their settlement payment, but the settlement procedures for the general public claims were not implemented. Nearly four years later, plaintiffs filed another lawsuit against defendant seeking specific performance of the provisions of the settlement documents concerning the general public claims.
The parties have labeled the UCL claims plaintiffs brought on behalf of the public as the “general public claims.” We will adopt the parties’ label for purposes of this opinion. Part II, post, notes the other labels that have been used to describe this type of UCL claim.
After a bench trial, the superior court rejected plaintiffs’ claim for specific performance. The superior court ruled that it did not have subject matter jurisdiction to enforce the settlement terms regarding the general public claims or, alternatively, plaintiffs failed to prove the existence of obligations that could be specifically enforced.
We conclude that the parties’ settlement documents, which defined the role of a court-appointed administrator and the role of the superior court in administering the general public claims, could not resurrect the subject matter jurisdiction that the superior court had before the original action was dismissed with prejudice. Furthermore, under the established principle of law that parties may not confer subject matter jurisdiction by consent, the settlement documents did not create subject matter jurisdiction over the general public claims. Stated in the abstract, parties A and B cannot endow a superior court with subject matter jurisdiction over UCL claims that C1, C2, C3 … Cn might have against B by agreeing that the court will administer and resolve those third party claims.
Therefore, the judgment is affirmed.
FACTS AND PROCEEDINGS
Plaintiffs Georgia Renner and David Soldana purchased a used 1987 Ford Elite, 25-foot motor home from defendant Dan Gamel, Inc., in 1995. Plaintiffs’ purchase of the used recreational vehicle (RV) was made under defendant’s sales program for used, rental RV’s that had been owned previously by Go-Vacation Motorhomes.
The vehicle’s five-digit odometer read 51,744 miles. The purchase agreement and odometer disclosure statement also indicated that the vehicle’s mileage was 51,744. The odometer and documents understated the vehicle’s mileage because the odometer had rolled over once. As a result, the vehicle’s actual mileage at the time of purchase was 151,744.
In July 1999, plaintiffs filed a complaint against defendant alleging claims for (1) fraud by intentional concealment and misrepresentation, (2) negligent misrepresentation, (3) negligence, (4) violation of the federal odometer act (49 U.S.C. §§ 32701-32711), (5) violation of the UCL, (6) false advertising with respect to vehicle mileage and a bait-and-switch down payment program, and (7) rescission.
On September 1, 2000, counsel for the parties appeared before the superior court and (1) recited the terms of a confidential settlement regarding the claims plaintiffs brought in their individual capacities and (2) outlined some of the terms of settlement concerning the claims brought on behalf of the public.
The superior court set the matter for another hearing on October 4, 2000, to give the parties time to resolve the remaining details of the settlement concerning the general public claims. The parties agreed that counsel for defendant would prepare a written settlement agreement containing the complete terms of the settlement. The October 4th hearing was taken off calendar and never reset.
In October 2000, plaintiffs and their counsel signed a written settlement agreement and general release and delivered it to counsel for defendant. The document does not contain the signature of defendant or defendant’s attorney. In exchange for the settlement agreement and general release, including the dismissal with prejudice described in section 2 of the agreement, defendant paid plaintiffs $85,000.
Section 6 of the settlement agreement and general release addressed the use of a separate proceeding to resolve the general public claims. The parties agreed that the Business and Professions Code claims brought on behalf of the general public by plaintiffs “shall be resolved by a separate proceeding supervised by a special master appointed by the Court pursuant to the agreement of the parties or, if the parties cannot agree, at the Court’s discretion.” Section 6 of the settlement agreement and general release also provided that “the defendant may challenge the claim of any purchaser who contends that he or she [was misinformed about the mileage on a Go-Vacation Motorhome] with the dispute to be resolved by a special master in accordance with procedure to be later determined.”
In accordance with section 2 of the settlement agreement and general release, a request of dismissal was filed and entered on November 6, 2000. The filing resulted in the dismissal of the “[e]ntire action of all parties and all causes of action” with prejudice.
In mid-November 2000, the parties exchanged a document titled “Stipulation and Order,” which was on pleading paper and bore the caption and case number of the action dismissed in its entirety. Counsel for defendant signed the stipulation, but it was not signed by defendant, plaintiffs, or plaintiffs’ counsel. Also, it was not filed with or signed by the superior court.
The stipulation’s provisions are described in the following three paragraphs.
Defendant was required to provide a court-appointed administrator certain documents related to the used RV’s that defendant obtained from Go-Vacation Motorhomes and sold. The documents were to include copies of the sales files and odometer disclosure statements.
Notices would be sent to purchasers of RV’s previously owned by Go-Vacation Motorhomes that had five-digit odometers and mileage in excess of 100,000. Purchasers who stated under oath that they purchased an RV without knowing its true mileage exceeded 100,000 miles could submit claims for “the disgorgement of the profit obtained on the sale as determined by the Administrator up to a maximum of $3,500.00.”
The duties of the court-appointed administrator were defined in nine numbered paragraphs set forth on a page and a quarter of the stipulation. Those duties were to include (1) collecting documents, (2) reviewing documents, (3) preparing and transmitting notice to potential claimants, (4) arranging the administrative hearings for claims contested by defendant, (5) attempting to resolve all disputed matters with counsel, (6) transferring cases that could not be settled at an administrative hearing to the court for a judicial determination of the claims, and notifying counsel of such transfer, (7) determining the amount and method of payment (not to exceed $3,500) to purchasers, (8) preparing a release of liability to be executed by the purchaser in exchange for money received from defendant, and (9) determining time limits.
In August 2004, nearly four years after the stipulation was exchanged, counsel for plaintiffs contacted defendant’s former attorney and learned defendant had changed attorneys. Counsel for plaintiffs then contacted defendant’s current attorney in an attempt to implement proceedings to resolve the general public claims. The attorneys for the parties were unable to reach an agreement.
The impasse caused plaintiffs to file a complaint on September 24, 2004, that sought specific performance of the settlement documents. The complaint alleged that defendant performed the obligations owed to plaintiffs individually under the settlement documents but refused to perform the obligations concerning the administration of the general public claims.
On January 23, 2006, the matter was tried to the superior court. The matter was continued until February 24, 2006, at which time the superior court issued a tentative decision in favor of defendant.
Counsel for defendant prepared a proposed statement of decision, which was filed on March 20, 2006. Plaintiffs submitted an opposition to the proposed statement of decision that requested various changes, including a request that the factual or legal basis for the conclusion that plaintiffs had failed to establish the existence of an enforceable contract.
On May 1, 2006, the superior court adopted the proposed statement of decision with minor changes. The superior court rejected plaintiffs’ claim for specific performance and ruled that (1) it lacked subject matter jurisdiction to implement the judicial process contemplated by the settlement documents for resolving the general public claims and (2) plaintiffs had not met their burden of establishing the existence of an enforceable agreement.
Final judgment was entered on May 5, 2006. Plaintiffs filed a notice of appeal on June 29, 2006.
DISCUSSION
I. Standard of Review
The parties agree that the issues regarding the enforceability of the settlement documents and subject matter jurisdiction present questions of law that are subject to independent review on appeal. We concur.
II. Background on General Public Claims
Although we have adopted the parties’ use of the label “general public claims” for the UCL claims plaintiffs brought on behalf of the public, we recognize that other courts and commentators have used different labels for these claims.
For instance, the California Supreme Court used the term “representative action” to refer to a UCL action that is not certified as a class action and is brought by a private plaintiff seeking disgorgement or restitution on behalf of persons other than or in addition to a plaintiff. (Kraus v. Trinity Management Services, Inc. (2000) 23 Cal.4th 116, 126, fn. 10.) One treatise dubbed this type of claim a “‘nonclass class’ UCL claim,” and acknowledged “it has also been referred to as a ‘representative’ or ‘private attorney general’ action.” (Stern, Bus. & Prof. C. § 17200 Practice (The Rutter Group 2007) ¶ 7:38, p. 7-13.)
On November 2, 2004, California’s voters approved Proposition 64 and eliminated “representative” actions for UCL violations. (Stern, Bus. & Prof. C. § 17200 Practice, supra, ¶¶ 2:47.1 & 2:47.3, pp. 2-15 & 2-16.) As a result, a person may pursue UCL claims on behalf of others only as a class action. (Bus. & Prof. Code, § 17203.)
Proposition 64 has been applied to all pending cases, even those filed before it became effective. (Stern, Bus. & Prof. C. § 17200 Practice, supra, ¶ 2:47.6, p. 2-17.) Because this appeal is decided on other grounds, we do not address the impact of Proposition 64 on this case.
III. Subject Matter Jurisdiction
A. Basic Principles
The jurisdiction of a particular court to hear and determine a type of proceeding is defined by statute or constitutional provision. (Abelleira v. District Court of Appeal (1941) 17 Cal.2d 280, 288; e.g., Estate of Buckley (1982) 132 Cal.App.3d 434, 448 [Legislature-imposed limits on subject matter jurisdiction of probate court].) A corollary of this principle is the well-established rule that “[s]ubject matter jurisdiction cannot be conferred by consent, waiver or estoppel.” (Hagan Engineering, Inc. v. Mills (2003) 115 Cal.App.4th 1004, 1008.)
The constitutional foundation for the subject matter jurisdiction of a superior court is section 10 of article VI of the California Constitution, which states that “[s]uperior courts have original jurisdiction in all other causes,” that is, the causes not otherwise referenced in that section.
Ordinarily, a cause commences with the filing of an action or special proceeding and terminates with its dismissal. (Hagan Engineering, Inc. v. Mills, supra, 115 Cal.App.4th at p. 1007.) After an action has been terminated by a dismissal with prejudice, the superior court no longer has subject matter jurisdiction to grant relief, except to award costs and fees or entertain a motion to vacate under Code of Civil Procedure section 473. (Hagan Engineering, Inc.,at pp. 1007-1008.)
Other principles regarding subject matter jurisdiction include the California Supreme Court’s statement that “[g]enerally, subject matter jurisdiction is the court’s power to hear and resolve a particular dispute or cause of action …. [Citations.]” (Donaldson v. National Marine, Inc. (2005) 35 Cal.4th 503, 512, italics omitted.) Similarly, subject matter jurisdiction “is sometimes referred to as jurisdiction ‘in its most fundamental or strict sense,’ or the ‘power to hear or determine the case.’ (Abelleira v. District Court of Appeal[, supra,] 17 Cal.2d 280, 288.)” (Shapell Industries, Inc. v. Superior Court (2005) 132 Cal.App.4th 1101, 1111.)
Other courts have discussed the existence of subject matter jurisdiction by referring to a “justiciable controversy.” (Housing Group v. United Nat. Ins. Co. (2001) 90 Cal.App.4th 1106, 1113-1114 [petition asking court to assume jurisdiction over pending settlement negotiations in undisclosed dispute did not present justiciable controversy].)
B. Subject Matters and Particular Disputes
Plaintiffs contend that the superior court had subject matter jurisdiction to specifically enforce the settlement documents based on the general principle that parties have the right to seek specific enforcement of a settlement agreement even after the underlying lawsuit is dismissed. (See Viejo Bancorp, Inc. v. Wood (1989) 217 Cal.App.3d 200, 208 [right to specifically enforce settlement contract even after dismissal].)
We recognize that settlement agreements are contracts and are governed by the general principles of contract law. (See Viejo Bancorp, Inc. v. Wood, supra, 217 Cal.App.3d at p. 208.) As a result, a settlement agreement is subject to specific enforcement, provided that it meets the general statutory requirements applicable to the specific enforcement of contracts. (Civ. Code, §§ 3384-3395.)
Accordingly, there is little question that the superior court would have had the power to hear and resolve a dispute between plaintiffs and defendant regarding defendant’s performance of an obligation under the settlement documents related to plaintiffs’ individual claim. Furthermore, if the statutory requirements for specifically enforcing obligations had been met, the superior court would have had the authority to resolve that dispute by ordering defendant to perform those obligations.
This case, however, concerns the superior court’s power over the general public claims, not simply a dispute between plaintiffs and defendant over the application of their settlement documents to their conduct. Thus, this case seems to involve a conflict between the principle that a superior court can enforce a settlement agreement in the same manner that it may enforce other contracts and the principle that parties may not confer subject matter jurisdiction on a court by agreement.
As a matter of logic, the potential conflict between these two principles suggests there is a line that separates settlement agreements that may be enforced specifically from those that attempt to confer jurisdiction. Because the California Supreme Court correlated subject matter jurisdiction to the “power to hear and resolve a particular dispute” (Donaldson v. National Marine, Inc., supra, 35 Cal.4th at p. 512), we conclude that the line may be drawn by distinguishing between situations that only involve a dispute about the agreement itself and situations where the agreement attempts to give the court power over disputes outside the agreement.
In this case, plaintiffs have assumed that this lawsuit involves only the specific enforcement of the terms of the settlement documents and have not addressed how to distinguish agreements that attempt to confer jurisdiction from other agreements.
In other words, each type of dispute is regarded as a separate subject matter over which the superior court must have subject matter jurisdiction before it proceeds.
It is readily apparent that plaintiffs’ current lawsuit asked the superior court to hear and resolve two types of disputes. The first dispute concerned defendant’s obligations under the settlement documents—specifically, whether defendant was obligated to go forward with the procedures for resolving the general public claims. The second type of dispute concerned defendant and third parties who purchased RV’s that defendant obtained from Go-Vacation Motorhomes. For example, the stipulation provided that if a third party purchaser submitted a claim and defendant contested that claim, “the dispute shall be determined by the Court in [a] judicial hearing for that purpose, unless the parties at that time agree on a different procedure for resolution of the individual matter.”
This provision in the stipulation clearly illustrates that plaintiffs are asking the superior court to “hear and resolve a particular dispute” (Donaldson v. National Marine, Inc., supra, 35 Cal.4th at p. 512) that exists outside the settlement documents. In other words, this case involves a more complicated situation than simply ordering a party to perform a particular act or to refrain from doing a particular act in accordance with the terms of an agreement. Here, enforcing the terms of the settlement documents would have required the superior court to do more—namely, become involved in administering and resolving claims held by persons who were not parties to the settlement.
The following are some simple examples of acts that a court might order a party to perform to enforce a settlement agreement: (1) Delivering money. (2) Executing and delivering a document, such as a request for dismissal or a document that transfers an interest in real or personal property.
The fact that this continued involvement is required of the superior court means that, in accordance with Civil Code section 3390, subdivision 4, defendant’s obligations regarding the general public claims are not specifically enforceable.
As a result, the superior court must have subject matter jurisdiction over the general public claims before it can become involved in hearing and resolving disputes of third party purchasers arising from those claims.
The only source identified by plaintiffs for the superior court’s power to hear and determine the claims of the third party purchasers is the settlement documents. The settlement documents, however, cannot create jurisdiction over those disputes or controversies. Doing so would directly contravene the principle that parties may not confer jurisdiction by consent. (Hagan Engineering, Inc. v. Mills, supra, 115 Cal.App.4th at p. 1008.)
The parties have cited, and we have located, no published California case that addresses whether a settlement or other agreement regarding the administration of general public claims can provide a superior court with subject matter jurisdiction over UCL claims of that type. More generally, the parties have cited no published California case law that addresses whether an agreement can confer subject matter jurisdiction over any type of third party claim.
In short, the attempt of the settlement documents to create subject matter jurisdiction over the UCL claims of third party purchasers must fail. Stated in the abstract, parties A and B cannot agree between themselves that a superior court will administer and resolve claims that C1, C2, C3 … Cn may have against B and thereby create subject matter jurisdiction in the superior court over those claims.
Indeed, not only did the stipulation assume it could require the superior court to exercise jurisdiction over the claims of third party purchasers, it also purports to restrict that authority. Generally, defining the existence of superior court jurisdiction, as well as any restriction on that jurisdiction, is a matter for the Legislature and not the agreement of private parties.
Consequently, we conclude that the superior court had no subject matter jurisdiction over the general public claims.
DISPOSITION
The judgment is affirmed. Defendant shall recover its costs on appeal.
WE CONCUR: VARTABEDIAN, Acting P.J., KANE, J.