Filed 5/25/16 Bagwell v. JP Morgan Chase Bank CA2/4
                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
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 This opinion has not been certified for publication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

                                   SECOND APPELLATE DISTRICT

                                                DIVISION FOUR


ESPERANZA D. BAGWELL,                                                B259805

         Plaintiff and Respondent,                                   (Los Angeles County
                                                                      Super. Ct. No. GC044928)
         v.

JP MORGAN CHASE BANK, N.A.,

         Defendant and Appellant.



         APPEAL from a judgment of the Superior Court of Los Angeles County,
Jan A. Pluim, Judge. Reversed.
         Bryan Cave, Glenn J. Plattner and Richard P. Steelman, Jr., for Defendant
and Appellant.
         Dan Hogue for Plaintiff and Respondent.
      In the purchase of her home, plaintiff Esperanza D. Bagwell obtained a
mortgage loan from Washington Mutual Bank (WaMu), secured by a first trust
deed on the property. After the demise of WaMu, defendant JP Morgan Bank,
N.A. (Chase) assumed the beneficial interest in the loan. Plaintiff defaulted, and
Chase initiated a nonjudicial foreclosure, which resulted in a trustee’s sale in which
Deutsche Bank National Trust Company (Deutsche) purchased the property for
$1,023,625.18 (the amount of the unpaid debt and other charges) and received a
trustee’s deed.
      Plaintiff sued Chase and Deutsche for wrongful foreclosure, among other
claims. The parties reached a written settlement agreement, enforceable under
Code of Civil Procedure section 664.6 (section 664.6), under which plaintiff
dismissed her claims and Chase agreed to consider plaintiff for a loan
modification. If Chase offered a loan modification, and plaintiff accepted, then
Chase would rescind the trustee’s deed issued to Deutsche (which would restore
plaintiff’s ownership of the property). However, if plaintiff did not accept the
modification offer, or if Chase sent plaintiff a written notice denying a loan
modification, Chase would pay plaintiff $50,000.
      Despite the term of the settlement providing for rescission of the trustee’s
deed only after plaintiff was offered and accepted a loan modification, Chase
recorded a notice of rescission of the trustee’s deed without such an offer or
acceptance. Plaintiff then brought a motion to enforce the settlement agreement
under section 664.6. She contended that Chase’s recording the notice of rescission
under circumstances not contemplated by the settlement agreement constituted an
acceptance of a prior offer she had made to purchase the property for $899,900, the
price at which Chase had listed the property at the time the settlement agreement
was reached.

                                          2
       The trial court (adopting the recommendation of the referee who heard the
matter) agreed, and ruled that Chase had implicitly agreed to transfer title to
plaintiff subject to an equitable lien of $899,900, unless Plaintiff “waive[d]”
ownership and chose to receive “the alternate payment of $50,000 provided for in
the” settlement agreement. Chase now appeals from the trial court’s order
enforcing the settlement agreement, contending that the trial court improperly
rewrote the agreement.1 We conclude that by creating a new, unwritten material
term, the trial court exceeded its authority to enforce the settlement agreement
under section 664.6. Therefore, we reverse the order.


                                         BACKGROUND
Loan and Default
       In November 2004, to finance the purchase of her home in Monrovia,
California, plaintiff made a $300,000 down payment and obtained a mortgage loan
of $900,000 from WaMu secured by a first trust deed on the property. In


1
       Ideally, the order should have been incorporated in a final judgment. However, it
was not. Nonetheless, as suggested by plaintiff, we deem the order appealable under
Code of Civil Procedure section 904.1, subdivision (a)(8), as an appeal “[f]rom an
interlocutory . . . order . . . made or entered in an action to redeem real . . . property from
a mortgage thereof, or a lien thereon, determining the right to redeem and directing an
accounting.” The court’s ruling had the effect of redeeming the property from a
mortgage, and the order directed an accounting, insofar as it provided that the rental
income received on the property after the recording of the notice of rescission (which
restored plaintiff’s ownership of the property) be offset by interest on Chase’s equitable
lien and any related property expenses.
       In the alternative, we exercise our discretion to treat the appeal as a petition for
writ of mandate, and consider it on the merits. (Olson v. Cory (1983) 35 Cal.3d 390,
401.) The order purports to finally resolve all issues between the parties, the case has
been thoroughly briefed, and plaintiff (as respondent) has expressly asked that we not
dismiss the case but rather decide it on the merits, as the case is more than six years old,
the complaint having been filed in March 2010.
                                                 3
December 2005, she obtained a home equity loan of $96,600 from WaMu secured
by a second trust deed. Following WaMu’s insolvency, Chase acquired certain of
WaMu’s assets and liabilities from the Federal Deposit Insurance Corporation
(acting as WaMu’s receiver) in September 2008. Among the assets acquired was
the beneficial interest in plaintiff’s mortgage loan.
      In March 2009, plaintiff defaulted on her mortgage loan. In June 2009, the
California Reconveyance Company (CRC), trustee under the first deed of trust,
recorded a notice of default against the property, followed in September 2009 by a
notice of trustee’s sale, which estimated the amount of the unpaid balance and
other charges at $1,009,897.80. Plaintiff sought a loan modification from Chase,
but Chase concluded she did not have sufficient income to qualify, and denied a
modification in October 2009. The trustee’s sale occurred in November 2009, and
a Trustee’s Deed Upon Sale was recorded conveying all interest in the property to
Deutsche as Trustee, which paid the amount of the unpaid debt and other charges,
calculated at $1,023,625.18.


Lawsuit and Settlement Agreement
      In March 2010, plaintiff sued Chase and Deutsche for wrongful foreclosure
(among other causes of action). That litigation ended in a written settlement
agreement, executed by plaintiff in December 2012 and Chase in February 2013.
      Under the agreement, which specified that it was enforceable under section
664.6, Chase “agree[d] to review a request for loan modification and all related
application and requested documents submitted by Plaintiff pursuant to its regular
practices and procedures.” Plaintiff was required to “submit all documents within
ten (10) days from JPMC’s [Chase’s] request.” If plaintiff failed to do so, Chase
had “no obligation to process the loan modification request.” Plaintiff agreed to

                                           4
“timely execute all documents which JPMC [Chase] customarily requires, and
otherwise cooperate in taking such additional action as is required to implement
the terms and conditions of this Agreement, and to process any request of Plaintiff
for a modification of the loan.” The agreement cautioned: “JPMC [Chase] does
not guarantee any specific loan terms, or otherwise promise that a loan
modification of any kind will be offered, as it is possible that based on the
information provided, and other considerations, Bagwell [plaintiff] may not meet
the criteria for loan modification.”
      However, if Chase offered a loan modification, and plaintiff accepted, then
Chase would rescind the trustee’s deed; upon receipt of the first modified loan
payment, the modified loan would thereafter be in full force and effect. On the
other hand, if within 15 days of the offer plaintiff failed to accept, or if Chase sent
plaintiff a written notice denying a loan modification, Chase would pay plaintiff
$50,000.2



2
       The relevant terms of the agreement are as follows:
       “3.2 Obligations of JPMC
              “3.2.1 JPMC agrees to review a request for loan modification and all
related application and requested documents submitted by Plaintiff pursuant to its regular
practices and procedures. If JPMC thereafter makes an offer to Plaintiff to modify the
loan on the Subject Property, and Plaintiff accepts said offer and executes all necessary
loan modification documents, JPMC will rescind the trustee’s deed upon sale recorded in
Los Angeles County Recorder’s office on November 10, 2009 as document
20091689765, and the loan, as modified, following receipt of the first payment due from
Bagwell, will be thereafter in full force and effect as modified. However, JPMC does not
guarantee any specific loan terms, or otherwise promise that a loan modification of any
kind will be offered, as it is possible that based on the information provided, and other
considerations, Bagwell may not meet the criteria for loan modification. Bagwell will
submit all documents within ten (10) days from JPMC’s request. If Bagwell fails to
timely submit documents, JPMC will have no obligation to process the loan modification
request.

                                            5
       As part of the agreement, plaintiff dismissed her claims against Chase and
Deutsche and gave them a release of liability. The agreement was fully integrated,
and additionally provided: “No supplementation, modification, waiver or
termination of this Agreement shall be binding unless executed in writing by the
Party to be bound thereby. [¶] . . . No waiver of any provisions of this Agreement
shall be deemed or shall constitute a waiver of any of the other provisions hereof
whether or not similar, nor shall such waiver constitute a continuing waiver. The
Parties hereto may amend or modify this Agreement in such manner that may be
agreed upon by written instruments executed by such Parties.”


Motion to Enforce the Settlement Agreement
       In February 2014, plaintiff brought a motion to enforce the settlement
agreement under section 664.6. In support of the motion, plaintiff and her counsel
filed a declaration (supported by exhibits) showing that at the time of the


               “3.2.2 In the event JPMC offers to modify Plaintiff’s loan and within
fifteen (15) days from the date JPMC offers Plaintiff a loan modification, Plaintiff fails to
accept the loan modification, or in the event after review of the loan modification
application, JPMC sends written notice to Plaintiff denying Plaintiff a loan modification,
JPMC shall pay Plaintiff the sum of Fifty Thousand Dollars ($50,000), herein, ‘the
Payment.’ The Payment shall be made only in the event a loan modification offer is not
timely accepted and or a loan modification is denied, as provided herein, and in either of
those events, said Payment will be made within twenty (20) business days from
Plaintiff’s delivery to JPMC’s counsel of an IRS form W-9 for all payees.
        “3.3 Obligations of Bagwell
               “3.3.1 Upon execution of this Agreement, Bagwell shall permanently
dismiss with prejudice the Lawsuit and waive all known and unknown claims arising
therein, and all other claims regarding the origination and/or servicing of the loan.
               “3.3.2 As provided in this Agreement, Bagwell shall timely execute all
documents with JPMC customarily requires, and otherwise cooperate in taking such
additional action as is required to implement the terms and conditions of this Agreement,
and to process any request of Plaintiff for a modification of the loan as provided in
paragraph 3.2.1.”
                                              6
settlement, Chase had listed the property for sale at $899,000. On November 2,
2012, as requested by Chase during settlement discussions, plaintiff (via email
through her counsel) sent Chase’s attorney her completed package for a loan
modification along with supporting documentation. Plaintiff’s counsel also
informed Chase’s attorney that plaintiff was willing to accept a modified mortgage
of $849,000, based on the $899,000 list price and a $50,000 down payment.
      As we have noted, plaintiff signed the settlement agreement in December
2012, and Chase signed in February 2013. According to plaintiff’s counsel, in
April 2013 he wrote to Chase’s attorney “reconfirming” plaintiff’s offer, and
demanding that Chase pay $50,000 to plaintiff under the settlement agreement
unless Chase intended to give plaintiff a loan modification.
      The settlement agreement contemplated that Chase would rescind the
trustee’s deed issued to Deutsche in the event it offered, and plaintiff accepted, a
loan modification. Nonetheless, in July 2013, without offering a loan
modification, Chase (through CRC) recorded a Notice of Rescission of Trustee’s
Deed Upon Sale, rescinding the trustee’s deed issued to Deutsche. The stated
purpose of the rescission was to “return the priority and existence of all lien
holders to the status quo ante that existed prior to the Trustee’s sale.” The effect of
the rescission was to restore the prior deed of trust, under which plaintiff was
named as trustor and owner of the property.
      After the rescission, in August 2013, plaintiff’s counsel wrote to Chase’s
attorney, informing Chase that the rescission violated the settlement agreement,
and that plaintiff viewed the rescission “as a tacit acceptance of her proposal” to
purchase the property. Counsel stated that plaintiff was awaiting details
concerning the interest rate for her loan and payment instructions. Also, until
plaintiff’s purchase was final, counsel stated that plaintiff expected Chase to retain

                                           7
rent payments from the tenants at the property as payment in full of interest on any
unpaid loan obligation.
      In response, Chase’s attorney emailed that he would try to get some answers.
In the following weeks, he told plaintiff’s attorney that Chase needed an entirely
new application.
      In her motion to enforce the settlement agreement, plaintiff asked for an
evidentiary hearing. She argued that the rescission of the trustee’s deed was partial
performance by Chase of the loan modification option of the settlement agreement.
According to plaintiff, the last listing price of $899,000 established the property
value, and the interest rate for the proposed $849,000 loan could be established by
the market rate for similar loans issued by Chase.


Chase’s Opposition
      In Chase’s opposition to the motion to enforce the settlement agreement,
supported by a declaration by Chase’s attorney, Chase argued that plaintiff was not
seeking to enforce the settlement agreement, but rather to rewrite it. According to
Chase, in order to be considered for a loan modification, plaintiff had to be the
owner of the property. Therefore, the trustee’s deed was rescinded. The rescission
was not a partial performance of the loan modification option of the settlement
agreement.
      The rescission took longer than expected, and thus some of plaintiff’s
financial documents became stale. Chase’s attorney asked plaintiff’s counsel to
have plaintiff re-submit certain documents, including those required by the IRS.
However, plaintiff refused. Thus, on February 5, 2014, Chase’s attorney informed
plaintiff’s counsel that plaintiff was denied a modification because of her failure to
provide updated financial documents. According to Chase, under these

                                          8
circumstances, Chase was prepared to pay plaintiff $50,000 under the settlement
agreement.


Plaintiff’s Reply
      In reply, plaintiff filed evidentiary objections to two statements in the
declaration of Chase’s attorney: (1) the statement that to consider plaintiff’s loan
modification, it was necessary to rescind the trustee’s deed, and (2) the statement
that the rescission took longer than expected and some of plaintiff’s financial
documents became stale. Also, according to plaintiff’s counsel, Chase did not
specifically inform him that it had denied a loan modification. Rather, the relevant
email from Chase’s attorney stated that a motion to enforce the settlement was
unnecessary, because he would “get the check for $50K cut.”


Judicial Reference
      In April 2014, the parties stipulated to submit the motion to enforce the
settlement to a referee. Therefore, the superior court referred the matter to a
referee, who was authorized to “issue such orders as he deems necessary for the
orderly presentation of evidence and argument,” and to make advisory findings of
fact and conclusions of law.
      In July 2014, the referee held a hearing which resulted in a written
recommendation of findings of fact and conclusions of law. Although the
recommendation states that it was issued after “ruling on the evidentiary objections
and reviewing all admissible evidence submitted and hearing arguments of
counsel,” no transcript or other record of the proceeding before the referee,
including which objections, if any, were sustained, is contained in the record on
appeal.

                                          9
       As here relevant, in the recommendation, the referee reasoned that under the
settlement agreement, Chase had two options: “a. Reach an agreement with
Plaintiff for modified loan terms (after which title would be transferred back to
Plaintiff); or b. Pay Plaintiff $50,000.” However, “[w]ithout revising the
Agreement, JPMC [Chase] executed and recorded a Notice of Rescission before a
loan modification agreement was secured. . . . [A]s contemplated by the
Agreement, the recordation of the Notice of Rescission signified a meeting of the
minds for the transfer of title back to Plaintiff only after a modified loan had been
offered and accepted.” In light of this reasoning, the referee found:
               “a.   The recordation of the Notice of Rescission effectively signified
Defendant’s agreement to return ownership to the Plaintiff at the then maximum
fair market value of the property. Therefore the maximum loan amount for a
modified loan (or equitable lien) is $899,000 -- being the full value of the property
transferred.
               “b.   The legal effect of the Notice of Rescission was the transfer of
legal title to the subject property to Ms. Bagwell. Because the property had been
listed for sale at a list price, the effect of the transfer is a tacit recognition and
establishment of an agreement that the value of the asset transferred to Plaintiff
was no greater than $899,000 unless Plaintiff now rejects the tender of title transfer
and instead opts for the $50,000 payment provided for in the Agreement.
               “c.   The Agreement did not contemplate or allow any unilateral
action by Defendants to restore enforceability to the previously foreclosed senior
or the foreclosed out junior loan without the express agreement of Plaintiff during
the modification process. As such neither deed of trust originally encumbering the
property is enforceable as originally recorded. However, the title transfer to



                                             10
Plaintiff was not free of encumbrance but the precise terms and legal form of the
encumbrance remain unresolved.
              “d.   Therefore the Plaintiff holds legal title to the subject property
subject to an equitable lien in the amount of $899,000 unless Plaintiff waives
ownership of the subject property and instead opts for the alternate payment of
$50,000 provided for in the Agreement.
              “e.   Although the factual date of title transfer to Plaintiff occurred
on July 11, 2013, there had been neither delivery of possession nor an accounting
of income and expense during the interim period. Any rental income received by
Defendants should be offset by interest on the equitable lien and any related
property expenses incurred between July 11, 2013 and the date actual possession is
tendered to Plaintiff.
              “9.   A full and complete loan modification application was
submitted in 2013 by Plaintiff within the time allowed by the Agreement, however,
the rescission took longer than expected thus some of Plaintiff’s financial
documents need to be updated.
              “10. The intent of the parties as set forth in the settlement agreement
is best served by proceeding with the loan modification process. The Referee
therefore recommends as follows:
              “a.   Within 30 days of the date the Court enters its Order on this
recommendation, Plaintiff shall provide the following documents to counsel for
Defendants:
                    “i.     Completed loan modification application, with
documents requested.
                    “ii.    Form 4506T-EZ for 2012, 2013, 2014.
                    “iii.   Profit and Loss Statement for the most current quarter.

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             “b.    Within 45 days of receipt of all documents requested in item 1,
JP Morgan Chase Bank, N.A. shall advise Plaintiff’s counsel, in writing, if Plaintiff
qualified for a loan modification and if so, shall advise of the terms of said loan
modification.
             “c.    Within 20 days of the date of service of the decision on the loan
modification, Plaintiff shall advise, in writing, that she accepts the loan
modification, or, that she rejects the loan modification.
             “d.    If plaintiff accepts the loan modification, she shall execute the
loan modification documentation and JPMC shall proceed with processing and
boarding the new loan terms. If Plaintiff has rejected the loan modification, JPMC
shall tender to Plaintiff’s counsel the sum of $50,000 within 20 days of receipt of a
W-9 from Plaintiff.”


Chase’s Objection and Court’s Adoption of the Recommendation
      In the superior court, Chase filed an objection to the referee’s
recommendation. Chase argued that “the issue before the Referee was solely the
enforcement of the Settlement Agreement, and did not include any authority to set
the terms of a modified loan, or the value of the property.” After an unreported
hearing, the court adopted the recommendation without modification.


                                    DISCUSSION
      I.     Reversal of the Section 664.6 Order is Required
      Chase contends that the trial court improperly rewrote the settlement
agreement, by setting the value of the property at $899,900 and modifying
plaintiff’s loan terms. We agree.



                                          12
      Under section 664.6, “‘[i]f parties to pending litigation stipulate, in a writing
signed by the parties outside the presence of the court . . . , for settlement of the
case, or part thereof, the court, upon motion, may enter judgment pursuant to the
terms of the settlement.’ [Citation.] ‘Section 664.6 was enacted to provide a
summary procedure for specifically enforcing a settlement contract without the
need for a new lawsuit.’ [Citation.] A trial court ‘hearing a section 664.6 motion
may receive evidence, determine disputed facts, and enter the terms of a settlement
agreement as a judgment.’ [Citation.] The trial court may not ‘create the material
terms of a settlement, as opposed to deciding what terms the parties themselves
have previously agreed upon.’ [Citation.] Thus, a trial court cannot enforce a
settlement under section 664.6 unless the trial court finds the parties expressly
consented, in this case in writing, to the material terms of the settlement.
[Citation.]” (Bowers v. Raymond J. Lucia Companies, Inc. (2012) 206
Cal.App.4th 724, 732, and cases therein cited.)
      Here, the court’s ruling did not rest on a determination of what the parties
expressly agreed upon in the written settlement agreement, and it did not enforce
those terms. Rather, it rested on the creation of an unwritten agreement to add a
new material term to the settlement agreement, under which Chase agreed to
transfer title to the property to plaintiff subject to an equitable lien of $899,900,
unless Plaintiff “waive[d]” ownership and chose to receive “the alternate payment
of $50,000 provided for in the” settlement agreement. This new, unwritten
material term was purportedly created by the occurrence of an event not covered
by the settlement agreement -- Chase’s recording a notice of rescission, which
transferred legal title back to plaintiff, before offering plaintiff a modified loan and
receiving plaintiff’s acceptance.



                                           13
      Thus, in several ways the court expressed its view that the recording of the
notice of rescission objectively manifested Chase’s assent to the court’s new
material term. As the court phrased it, the recording “signified a meeting of the
minds for the transfer of title back to Plaintiff only after a modified loan had been
offered and accepted”; “effectively signified [Chase’s] agreement to return
ownership to the Plaintiff at the then maximum fair market value of the property”;
was “a tacit recognition and establishment of an agreement that the value of the
asset transferred to Plaintiff was no greater than $899,000 unless Plaintiff now
rejects the tender of title transfer and instead opts for the $50,000 payment
provided for in the Agreement”; and gave “legal title to the subject property
subject to an equitable lien in the amount of $899,000 unless Plaintiff waives
ownership of the subject property and instead opts for the alternate payment of
$50,000 provided for in the Agreement.”
      Having created the new material term regarding transfer of title subject to an
equitable lien of $899,900, the court then sought to implement it in a manner
consistent with the intent of the settlement agreement. Thus, it ordered that the
rental income on the property received by Chase “should be offset by interest on
the equitable lien and any related property expenses incurred” between the date the
notice of rescission was filed and the date possession of the property returned to
plaintiff. Further, the court ordered the parties to comply with various conditions
and time frames to implement the process called for in the settlement agreement
regarding Chase considering plaintiff for a loan modification.
      Thus, in the guise of enforcing the settlement agreement, the court created a
new, unwritten material term, under which Chase agreed to transfer title to plaintiff
subject to an equitable lien of $899,900, unless Plaintiff “waive[d]” ownership and
chose to receive “the alternate payment of $50,000 provided for in the” settlement

                                          14
agreement. The court then sought to enforce this new term in an equitable way,
consistent with the court’s view of the parties’ intent as reflected in the settlement
agreement. But by creating a new material term, and seeking to enforce it, the
court exceeded its power under section 664.6.
      Plaintiff makes several contentions in support of the court’s order, all of
which miss the mark. She contends that the evidence does not support Chase’s
assertion that the court’s ruling reduced the balance of her loan from more than $1
million to $899,900, or that recording the rescission of the trustee’s deed was
required for Chase to consider plaintiff’s application for a modified loan. She
argues that the transfer of title to her effected by the notice of rescission, viewed
under the substantial evidence standard, established Chase’s acceptance of her
offer to purchase the property for $899,900. She asserts that the court did not
rewrite the settlement agreement, but rather “factually interpreted the conduct of
the parties in a fashion consistent with” the terms of the settlement agreement, and
that “[t]he court’s decision to impose an equitable lien in favor of Chase is
consistent with long-established principles of equity and is an entirely appropriate
order that [gives plaintiff] the benefit of her bargain in the settlement agreement
and post settlement agreement negotiations while still protecting Chase from the
results of its own deviant actions.”
      However, these contentions fail to address the core problem in the trial
court’s ruling. This was not a bench trial on a cause of action for breach of
contract based on Chase’s act of recording of the notice of rescission, nor was it a
trial on a claim for specific performance of an implied contract created by
recording the notice of rescission. It was a proceeding under section 664.6 to
enforce a settlement agreement, in which the court’s authority was limited to
enforcing the terms of the settlement agreement to which the parties previously

                                           15
agreed. As such, the court had no power to materially modify the express terms of
the written settlement agreement. (Bowers, supra, 206 Cal.App.4th at p. 732.)
      At oral argument, plaintiff argued that the decision in Malouf Bros. v. Dixon
(1991) 230 Cal.App.3d 280 suggests that the trial court did not exceed its authority
under section 664.6. In Malouf, the appellant hired the respondents, who were
contractors, to repair a road on his property, and was later sued by respondents for
money due on the contract. The parties settled under terms (as here relevant) that
the appellant would convey to respondents a certain parcel of land (with
respondents paying a specified sum), and respondents would repair a washed out
road at their own expense, with the repairs to be tested by a soil engineer.
However, the appellant later refused to convey the land, contending that the road
repairs were defective. (Id. at p. 282.)
      The respondents brought a motion to enforce the settlement agreement under
section 664.6. The trial court granted the motion, requiring the appellant to convey
the land upon payment of the sum stated in the agreement. (Malouf, supra, 230
Cal.App.3d at p. 283.) On appeal, the appellant challenged the ruling, contending
that the trial court was precluded from resolving the factual dispute whether the
road repairs were satisfactory under the settlement agreement. The court of appeal
disagreed, and held that “the trial court was authorized to determine that
respondents had complied with their road repair obligations notwithstanding
appellant’s assertions to the contrary.” (Id. at p. 284.)
      Nothing in Malouf alters our analysis. Certainly the trial court in the instant
case had the authority to make a factual determination whether Chase had
complied with the settlement agreement. But upon making such a determination,
the only remedy was to enforce the terms of the settlement agreement, and require
Chase to do what it had agreed to do. The court could not create another

                                           16
agreement (one in which Chase agreed to give plaintiff title in exchange for an
equitable lien of $899,000) when no such term was in the settlement agreement.


Remedy
      The remaining question is what to do now. Chase requests that, in addition
to reversing the trial court’s order, we instruct the trial court to order that the value
of the property be set by a current appraisal though the loan modification process.
On this record, we decline to find that such a term was encompassed by the written
settlement agreement. However, we do so without prejudice to the filing of a new
motion (or motions) to enforce the settlement agreement under section 664.6,
seeking a determination whether such a term (or any other in dispute) was agreed
to by the parties in their settlement agreement. We caution that in any future
section 664.6 proceeding, the parties and the court must observe the proper scope
of such a proceeding: the court is to determine what the parties previously agreed
upon in the written settlement agreement, and to enforce the terms of that
agreement; the court cannot create new material terms and seek to enforce them.
(Bowers, supra, 206 Cal.App.4th at p. 732.) Of course, the parties remain free to
modify the settlement agreement in writing so as to facilitate its implementation,
and to make any such modification enforceable under section 664.6.
                                            //
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                                           17
                     DISPOSITION
The order is reversed. Chase shall recover its costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS




                                 WILLHITE, J.




We concur:




EPSTEIN, P. J.




COLLINS, J.




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