Court Opinion

ID: 6328324
Source: CourtListenerOpinion
Date Created: 2022-03-30 18:02:02.738988+00
Date Added: 2024-06-11T09:22:38.412337
License: Public Domain

Filed 3/30/22 Lee v. Bank of America CA3
                                           NOT TO BE PUBLISHED

California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
                                      THIRD APPELLATE DISTRICT
                                                      (Calaveras)
                                                            ----

DON H. LEE,                                                                                  C091938

                   Plaintiff and Appellant,                                     (Super. Ct. No. 17CV42098)

         v.

BANK OF AMERICA, N.A.,

                   Defendant and Respondent.

         Plaintiff Don H. Lee and defendant Bank of America, N.A., settled a prior action
between them. Before the terms of the settlement had been satisfied, Lee filed this action
against Bank of America alleging causes of action related to the settlement. After the
terms of the settlement in the prior action had been satisfied, the trial court ordered the
parties to show cause why this case should not be dismissed as moot. After a hearing, the
trial court dismissed this action as moot.

                                                             1
       Lee now contends (1) the trial court improperly determined mootness at a hearing
on an order to show cause, (2) the trial court improperly relied on inadmissible evidence,
and (3) the trial court erred in finding the case moot.
       Finding no error, we will affirm the judgment.
                                     BACKGROUND
       In case No. 14CV40435, Bank of America sued Lee concerning a deed of trust
secured by real property in Calaveras County.1 In a settlement conference for that case,
the parties agreed to settle the case with specific terms. Two of the major terms were that
Lee would reconvey the deed of trust and Bank of America would pay Lee $5,000. The
parties agreed that Bank of America would prepare a formal settlement agreement.
While Lee reconveyed the deed of trust, he refused to sign the settlement agreement
prepared by Bank of America. And Bank of America did not give Lee $5,000.
       On January 9, 2017, Lee filed this action (case No. 17CV42098) against Bank
of America, alleging four causes of action relating to the settlement agreement in case
No. 14CV40435 and Bank of America’s failure to pay him $5,000. The four causes of
action were for breach of contract, breach of the covenant of good faith and fair dealing,
promissory fraud, and cancellation of a recorded instrument.
       Bank of America moved to enforce the settlement under Code of Civil Procedure
section 664.6 and to obtain an order for Lee to sign the settlement agreement. The trial
court granted Bank of America’s motion and ordered Lee to sign the settlement
agreement. On its own motion, the trial court found that case No. 17CV42098 had been
rendered moot by the settlement and therefore dismissed it. (Bank of America N.A. v.
Lee, supra, C084613.) Lee appealed, and this court affirmed the trial court’s order

1 We take judicial notice of this court’s opinion in Bank of America, N.A. v. Lee
(June 25, 2019, C084613) [nonpub. opn.]. (Evid. Code, § 451, subd. (a).)

                                              2
enforcing the settlement but reversed the dismissal of 17CV42098 because Lee did not
have notice and an opportunity to be heard before the dismissal. (Ibid.)
       Thereafter, Lee executed the settlement agreement in case No. 14CV40435. Also,
Bank of America delivered a check to Lee for $5,000 on December 12, 2019, and Lee
deposited the check into his bank account. However, Lee changed his mind about
accepting the money, so he sent a cashier’s check for $5,000 to Bank of America on
January 6, 2020.
       The trial court ordered the parties to show cause why case No. 17CV42098 was
not rendered moot by this court’s ruling in case No. 14CV40435 and therefore should not
be dismissed. Lee filed a memorandum opposing dismissal of case No. 17CV42098, and
on February 7, 2020, the trial court held a hearing on its order to show cause. With the
agreement of both parties, the trial court dismissed case No. 14CV40435 with prejudice.
After hearing argument from the parties, the trial court also dismissed case No.
17CV42098.2

2 The trial court dismissed this action (case No. 17CV42098) without prejudice.
Normally, the designation as without prejudice would preclude appealability because
there is no final judgment. Here, however, the case falls under a narrow exception in
which the trial court intended to allow only a new action based on new facts. (Topa Ins.
Co. v. Fireman’s Fund Ins. Companies (1995) 39 Cal.App.4th 1331, 1336.) The trial
court stated at the hearing: “I am going to order that 17CV42098 is dismissed . . .
without prejudice to file a new Complaint if there are any new facts and new theories of
law arising out of the entire settlement process.” Because the dismissal was with
prejudice as to the facts involved in case No. 17CV42098, the dismissal is appealable.
However, we note that res judicata would preclude consideration of any issue in a future
action that was or could have been litigated in this action. (Bullock v. Philip Morris USA,
Inc. (2011) 198 Cal.App.4th 543, 557.)

                                            3
                                      DISCUSSION
                                             I
       Lee contends the trial court improperly determined mootness at a hearing on an
order to show cause.
       Before considering this contention, we note Lee finds fault with some of the
statements the trial court made during the hearing on the order to show cause. For
example, Lee faults the trial court for saying that the hearing on the order to show cause
was like a demurrer. But it does not matter what the trial court said in that regard
because we review the correctness of the trial court’s ruling dismissing the action and not
the reason for that ruling. (Muller v. Fresno Community Hospital & Medical Center
(2009) 172 Cal.App.4th 887, 906-907.) We therefore need not consider whether various
statements made by the trial court were erroneous.
       Lee argues the hearing on the order to show cause failed to give him a meaningful
opportunity to present argument that case No. 17CV42098 should not be dismissed.
While it is true a trial court must give notice and an opportunity to be heard before
dismissing an action on its own motion, as this court noted in the decision in the prior
appeal (Bank of America, N.A. v. Lee, supra, C084613), following remittitur the trial
court gave Lee notice and an opportunity to be heard. The trial court notified Lee of the
need to present his arguments on whether the case is moot, and in response, Lee filed a
written memorandum and appeared at a hearing. Lee presents no persuasive argument
that this procedure was constitutionally inadequate.
       Lee also argues the hearing on the order to show cause was an inappropriate
vehicle for determining mootness because the trial court made a factual determination
about whether Lee had been paid the $5,000 required by the settlement agreement. But
the trial court did not make a factual determination; the material facts were undisputed.
Rather, the trial court made a legal determination that dismissal was appropriate even
though Lee had sent a $5,000 check to Bank of America.

                                             4
       Lee’s arguments lack merit.
                                             II
       Lee next contends the trial court improperly relied on inadmissible evidence.
He claims the trial court should not have taken judicial notice of (A) a declaration filed
by Bank of America that $5,000 had been paid to Lee and (B) this court’s conclusion in
the prior appeal that the formal settlement agreement was consistent with the settlement
entered into by the parties at the settlement conference.
                                             A
       Lee, himself, declared: “Bank of America delivered a check for $5,000 to me on
December 12, 2019. I deposited the check in my bank account as the check was not
accompanied by any indication that the $5,000 had been tendered in full settlement of
Case No. 17CV42098.” Lee’s suggestion that the trial court improperly relied on Bank
of America’s declaration lacks merit because Lee declared the same material facts.
                                             B
       Other than claiming that a court cannot take judicial notice of a document for the
truth of the facts stated in the document, Lee gives no reason why the trial court could not
rely on the holding in our prior opinion that the formal settlement agreement was
consistent with the settlement entered into by the parties at the settlement conference.
(Bank of America, N.A. v. Lee, supra, C084613.) Having obtained a final determination
concerning the consistency between the settlement terms and the formal settlement
agreement, Lee is not entitled to relitigate that issue. (In re Estate of Bauer (1929)
208 Cal. 199, 199-200.)
       The record does not establish that the trial court relied on inadmissible evidence in
dismissing the action.
                                             III
       In addition, Lee contends the trial court erred in finding the case moot. He does
not connect his arguments to any particular cause of action alleged in his complaint in

                                              5
case No. 17CV42098; rather, he makes arguments about the legal effect of the facts and
our prior decision in Bank of America, N.A. v. Lee, supra, C084613.
       Once again, Lee argues he did not receive $5,000 in satisfaction of the settlement
agreement because he tried to give the money back. In the trial court, he declared that he
received the check for $5,000 from Bank of America and deposited it into his bank
account. Later he obtained a cashier’s check for $5,000 and sent it to Bank of America,
in his words, “to avoid what may have been an attempt [by Bank of America] to claim
that the check for $5,000 was tendered in full compliance with [the] 2016 settlement, or
in the alternative, tendered as an accord and satisfaction that fully satisfied the disputed
claims alleged in Case No. 17CV42098.”
       Bank of America’s payment of $5,000, which Lee accepted and deposited into his
account, was obviously an effort to satisfy Bank of America’s obligation under the
settlement agreement. Although Lee denies that the $5,000 payment satisfied the claims
in case No. 17CV42098, he does not specify what claim it did not satisfy.
       Lee argues he properly rejected the payment under California Uniform
Commercial Code section 3311. He asserts he could reject the payment because there
was no accompanying statement that it was in “full satisfaction of the claim.” (Cal. U.
Com. Code, § 3311, subd. (b).) Lee also asserts there remained between him and Bank
of America a “bona fide dispute” (Cal. U. Com. Code, § 3311, subd. (a)), and he validly
returned the payment under California Uniform Commercial Code section 3311,
subdivision (c)(2), which allows a party to return payment within 90 days.
       California Uniform Commercial Code section 3311 allows a party to propose a
full settlement of a claim by sending a check and including the statement that it is in full
satisfaction of the claim. If the other party accepts the payment, the claim is satisfied.
(Cal. U. Com. Code, § 3311, subd. (b).) However, this provision does not apply to a
settlement agreement like the one in this case, because here the matter was already settled
in a writing for an agreed-upon amount and the check was in satisfaction of that settled

                                              6
matter. California Uniform Commercial Code section 3311 applies only if there is a
“bona fide dispute” concerning the amount owed. (Cal. U. Com. Code, § 3311, subd. (a);
Lucky United Properties Investment, Inc. v. Lee (2010) 185 Cal.App.4th 125, 150.) Here,
there was no such dispute because the issue had been agreed upon and resolved before
Bank of America made the payment. Lee’s unsupported assertion that the payment did
not satisfy unspecified claims does not change this result.
       “When a plaintiff has received all that he or she has demanded in the complaint,
the case is considered ‘moot’; in other words, there is no further relief the court could
provide. ‘ “Generally, courts decide only ‘actual controversies’ which will result in a
judgment that offers relief to the parties. [Citations.]” ’ [Citation.] [¶] ‘The pivotal
question in determining if a case is moot is therefore whether the court can grant the
plaintiff any effectual relief. [Citations.] If events have made such relief impracticable,
the controversy has become “overripe” and is therefore moot. [Citations.] . . . When
events render a case moot, the court, whether trial or appellate, should generally dismiss
it.’ [Citations.]” (Schoshinski v. City of Los Angeles (2017) 9 Cal.App.5th 780, 791.)
       When events occurring after the filing of a complaint render a cause of action
moot, the trial court may dismiss the cause of action on its own motion. (Rio Vista Farm
Bureau Center v. County of Solano (1992) 5 Cal.App.4th 351, 383.) Here, the signing of
the settlement agreement in case No. 14CV40435 and the satisfaction of its terms
rendered the complaint in case No. 17CV42098 moot because the latter action was
predicated solely on the alleged failure of Bank of America to comply with the terms of
the settlement agreement.
       Lee makes additional arguments attacking the trial court’s conclusion that the
current action is moot, but those arguments are also moot. For example, Lee claims the
trial court erred in determining that Lee’s signing of the formal settlement agreement was
a condition precedent to Bank of America’s obligation to pay Lee $5,000. However,

                                              7
because the formal settlement agreement has been signed and the payment was made, it
does not matter at this point whether one was a condition precedent of the other.
       Because the parties settled their dispute and complied with the terms of the
settlement agreement, the trial court properly concluded the current action is moot.
                                        DISPOSITION
       The judgment is affirmed. Bank of America is awarded its costs on appeal.
(Cal. Rules of Court, rule 8.278(a).)

                                                    /S/
                                                 MAURO, J.

We concur:

    /S/
BLEASE, Acting P. J.

    /S/
RENNER, J.

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