Raygoza v. Betteravia Farms

Opinion

ABBE, J.

Appeal from a court order imposing sanctions for participating in a voluntary, privately conducted settlement conference without full authority to settle. We reverse.

Respondents filed this action to recover damages for personal injuries arising from an automobile accident. The defendants in the action are insured by appellant.

The parties agreed to have a voluntary settlement conference on January 6, 1986, before a retired superior court judge, whose fees for such services were to be shared equally by the parties. The conference was continued to March 5 by agreement of the parties.

At the hearing on March 5, the retired judge suggested a settlement figure of $200,000. This amount exceeded the settlement authority of the representative of the insurance company present at the hearing. He required approval to settle for that sum from the “home office.” The voluntary settlement conference was continued to March 24.

On March 13, counsel for respondents notified appellant she would not attend any further voluntary settlement conferences because of the insurance company’s representative’s lack of sufficient authority to settle on March 5. She filed a motion for sanctions seeking attorney’s fees and costs incurred in attending the March 5 conference. This motion was noticed for hearing on April 11.

Prior to March 24, respondents agreed to accept a $500 offer of appellant to resolve the motion for sanctions. Appellant also agreed to and did pay the retired judge’s fees. It was agreed that neither side would appear in court at the April 11 hearing date and the motion was to be taken off calendar.

[1595]

On April 11 an attorney from the law offices of counsel for appellant happened to be in court on another matter. When respondents’ motion was called, the attorney informed the judge that the parties had independently settled the sanction motion and requested the matter be taken off calendar. This request was denied and the court, on its own motion, continued the matter to April 28 and ordered appellant to show cause on April 28 why “additional sanctions should not be imposed pursuant to [California Rules of Court] rule 227.”