MANELLA, J.
Appellant First Assembly of God Church of North Hollywood appeals from an order of the superior court lifting the stay of enforcement of a default judgment in favor of respondents Soren and Angela Bedoyan.
On December 3, 2008, respondents filed a complaint for damages against appellant. In the complaint, respondents alleged they purchased three lots of land, located at 11479, 11495, and 11489 Burbank Boulevard, North Hollywood, California, from appellant for $1,650,000. Respondents further alleged appellant failed to disclose that the use of the three lots was limited to church parking.
On January 4, 2009, the parties entered into the Agreement. Under paragraph 1 of the Agreement, appellant agreed to pay respondents $172,000, "which sum represent[ed] [respondents'] out of pocket damages." Appellant also agreed it would "obtain final approval from any and all appropriate agencies allowing [respondents] to use the Property for any legal commercial use." Finally, appellant agreed to deposit $410,000 in an escrow account. The parties agreed that "[i]f [appellant] obtains the [a]pprovals by 5:00 p.m., April 5, 2009, then . . . four hundred thousand dollars ($400,000.00) in escrow shall be released to [appellant] from the escrow account, ten thousand ($10,000.00) in escrow shall be released to [respondents' attorney], and [respondents] shall file a dismissal of [appellant] from the Superior Court Action. If [appellant] does not obtain the [a]pprovals by 5:00 p.m., April 5, 2009, then the four hundred ten thousand dollars ($410,000.00) in escrow shall be released to [respondents' attorney] from the escrow account, [appellant] shall be released from any further responsibility and/or liability with respect to obtaining the [a]pprovals, and [respondents] shall file a dismissal of [appellant] from the Superior Court Action."
The Agreement also included a standard contractual provision that stated it "may be amended by [a] writing executed by the parties. No subsequent modification or amendment of this Agreement between the Parties shall be effective, however, unless in writing signed by all of the Parties."
On April 17, 2009, respondents' counsel sent a letter to the escrow company, stating that "[p]er paragraph 1C of the January 4, 2009 Settlement Agreement of [the] parties . . ., [appellant] agreed that if final approvals of my client to use his property for any lawful purpose had not been obtained by
Along with sending the demand letter to the escrow company, respondents also moved for entry of default judgment in the superior court action. The clerk entered default on April 20, 2009. On June 3, 2009, respondents filed a motion to enforce the Agreement. On November 17, 2009, the superior court entered an order awarding respondents a money judgment of $425,525.46, which included applicable interest, fees, and costs.
On November 23, 2009, appellant filed an ex parte application for an immediate stay of the execution of the judgment until a hearing could be held on its motion to set-aside default and vacate judgment. In the motion, appellant alleged it had "obtained all of the documentary approvals releasing the restriction affecting the property sold to [respondents] prior to the April 5, 2009, deadline." Respondents filed an opposition, in which their attorney stated that "[a]s of today, [Soren Bedoyan] still has not been given proof that his property is free from the lot tie in restrictions with Building and Safety. On September 11, 2009[,] I personally met with [respondents] and a member of Los Angeles Building and Safety who told us quite candidly that it could take anywhere from six (6) months to one (1) year before [respondents'] property could show up on City records as being free from the lot tie-in restrictions."
The trial court granted appellant's motion. In a written order, the court stated that "[o]n the merits, the court is faced [with] dueling declarations." According to the court, "[i]t is virtually impossible for the court to discern who is telling the truth in this matter. As such, and due to the judicial policy of having cases tried on their merits, the motion is granted."
On December 18, 2009, appellant filed a motion to vacate judgment and for relief from default. Appellant contended that "[t]o this date, there is no competent evidence before the Court that the use restrictions claimed by [respondents] on the property
In support of the motion, Darrell G. Maston, president of appellant, filed a declaration stating that "[t]he release documents required by the Settlement Agreement were obtained and dated on April 2, 2009, and approved by the Department of Building and Safety on April 3, 2009. They were thereafter recorded with the Los Angeles County Recorder on April 8, 2009." Maston also stated that he "received written confirmation from Nick Trotta, Chief Zoning Engineer from the Department of Building and Safety, that the restrictions were lifted."
Maston further stated he was unaware of entry of the default judgment, and was not informed by respondents' attorney about the default. "To the contrary, it was my impression and understanding that the [respondents] and [their counsel] were cooperating with us in order to finalize our settlement." Maston asserted respondents' attorney "led" him to "believe we were working together in further efforts to settle the matter to the satisfaction of the [respondents]."
Appellant attached the Trotta letter, which was dated May 28, 2009. The letter stated: "In response to your request of May 12, 2009, regarding the above referenced property [the church located at 11455 Burbank Blvd.] please be advised of the following: [¶] At this time there are no recorded agreements for off-street parking or lot ties between your property located at 11455 Burbank Blvd. and the property located at 11479 Burbank Blvd. The previous agreements to provide off-street parking on the Sourens [sic] Automotive Repair property at 11479 Burbank Blvd. for the benefit of the Center Church at 11455 Burbank Blvd. property have been terminated." The letter made no reference to other use restrictions on the property at 11479 Burbank Boulevard or to any use restrictions on the other two properties.
Respondents filed an opposition to the motion to set aside the default judgment. Respondents asserted appellant did not obtain the removal of the use restrictions by April 5, 2009. Respondents contended "a simple letter from the City actually would not suffice to release [respondents'] property from certain `lot tie-ins.'" Respondents also noted appellant did not actually obtain the City's approval of any termination of restrictive covenants purportedly applicable to the three lots until April 13, 2009, and even this approval applied to a different property (18996 Soledad Canyon Road, Canyon Country, California).
On January 21, 2010, the trial court issued an order denying appellant's motion to set aside the default on the ground that "the issue to be determined by the Court is whether or not [appellant] complied with [the] terms of the settlement agreement." The court ordered further briefing, and stayed enforcement of the default judgment pending the hearing on this issue.
In response, appellant contended (1) it "timely obtained the approvals releasing the restrictions affecting [respondents'] properties"; and (2) respondents waived the contractual deadline for performance by accepting partial performance in that respondents agreed to receive payment of $10,000 in attorney fees. Appellant also attached documents showing that restrictive covenants applicable to the lots located at 11479 and 11489 Burbank Boulevard were terminated July 20 and 23, 2009.
Respondents filed a response in which they asserted appellant did not obtain the release of the use restrictions on the three lots by April 5, 2009. Respondents reiterated they never accepted partial performance, nor did they waive the terms of the Agreement. With respect to the $10,000 payment, respondents further noted that "the $10,000.00 to be released to [respondents] is nowhere characterized as `attorney's fees.' It was, in fact, additional compensation to be paid to [respondents] for having to wait the additional 90 days (i.e., until April 5, 2009) for [appellant] to perform, and it was to be paid to [respondents]
The trial court held a hearing on May 24, 2010 "regarding compliance with the parties' settlement agreement." At the hearing, the court heard from Soren Bedoyan and Maston, as well as their respective counsel. Bedoyan testified he checked with the City of Los Angeles Department of Building and Safety on many occasions in August and September 2009, and was informed the restrictions on the three lots had not been lifted. Bedoyan also testified he did not enter into any oral or written modification of the Agreement. Maston testified he had no documentation aside from the Trotta letter showing that all of the restrictive covenants applicable to the three lots had been terminated.
On June 7, 2010, the trial court issued an order denying appellant's motion to vacate the default judgment and lifting "[t]he stay order as to [the] execution of the judgment." The court found "[t]he evidence supports that [appellant] did not comply with the settlement agreement." According to the court, "[b]ased on the evidence presented by way of the briefs and the testimony on May 24, 2010, . . . defendant failed to provide proof that the lots are free from use restrictions as agreed. Based on the testimony of both [respondent] Soren Bedoyan and [appellant's] representative, Pastor Darrel Maston, it is still not clear whether the use restrictions have been lifted from the property at this time (over a year after the deadline set forth in the Settlement Agreement)." The court further found that "defendant made efforts to comply with the terms of the settlement agreement; however, it could be said that defendant did not act diligently. The settlement was entered on January 4, 2009, but it appears that defendant waited until April 3, 2009 to begin its efforts to have the use restrictions removed, when its deadline was April 5, 2009. While defendant continued its efforts to have the restrictions removed after April 5, 2009, likely under the belief that it would not be required to forfeit the $400,000, there was never any written modification of the settlement agreement as required by the express terms of the agreement."
Appellant timely appealed from this order.
Appellant contends (1) the trial court erred in finding that appellant had not performed under the Agreement, and (2) the court erred in finding that respondents had not waived the contractual deadline for performance. We review a challenge to a trial court's factual findings under the substantial evidence rule. If there is substantial evidence in the record to support the findings, we will affirm. (Winograd v. American Broadcasting Co. (1998) 68 Cal.App.4th 624, 632.)
The trial court found that appellant did not comply with the terms of the Agreement, and that as of the date of the hearing, "it is still not clear whether the use restrictions have been lifted from the property at this time." Appellant contends "documentary evidence established that the termination documents were obtained and recorded in April and July 2009." Appellant also referenced the May 28, 2009 letter from Trotta, which stated that one of the restrictive covenants had been lifted from one of the three lots. We note that the trial court found only that it was "still not clear" that all of the restrictions had been lifted. This factual finding is amply supported by Soren Bedoyan's testimony that he was informed in August and September 2009 by employees at the Department of Building and Safety that the restrictions had not been lifted. In addition, the documentary evidence indicates, at best, that as of July 2009, the use restrictions had been lifted on only two of the three lots. In any event, appellant does not dispute that it did not fully perform by the April 5, 2009 deadline. As the contract had a performance date requirement, the trial court did not err in finding that appellant failed to comply with the terms of the Agreement.
Appellant next contends respondents waived their right to timely performance by working with appellant on lifting the restrictions, and by accepting payment of $10,000 from the escrow account. The trial court found otherwise. We conclude that even assuming appellant belatedly performed, there was substantial evidence to support the trial court's finding that respondents did not waive their contractual right to timely performance by their conduct.
First, it is undisputed there was no written modification of the Agreement to allow for late performance. Second, the record shows that respondents have consistently asserted their rights under the contract by promptly filing motions for default judgment and for enforcement of the Agreement.
Evidence that respondents worked with appellant to lift the restrictions does not establish that they waived their right to timely performance. There is no evidence that respondents told appellant they were waiving their right to seek judgment on their motion to enforce the Agreement. Respondents' actions may be interpreted as assisting appellant to mitigate its damages by having the restrictions promptly lifted.
In addition, the acceptance of $10,000 from the escrow account does not indicate acceptance of partial performance. Appellant's argument is based upon the provision in the Agreement that "[i]f [appellant] obtains the [a]pprovals by 5:00 p.m., April 5, 2009, then . . . four hundred thousand dollars ($400,000.00) in escrow shall be released to [appellant] from the escrow account, ten thousand ($10,000.00) in escrow shall be released to [respondents' attorney], and [respondents] shall file a dismissal of [appellant] from the Superior Court Action." According to appellant, respondents waived the contractual deadline by agreeing to have $10,000 released from the escrow account to their attorney. Appellant also noted that at that time, it requested preparation of an instruction that the remaining $400,000 in escrow be released to it. These facts, however, are insufficient to overturn the trial court's finding. If respondents had agreed to accept appellant's obtaining approvals after April 5, 2009, respondents would have agreed to file a dismissal of the superior court action and consented to the release of the $400,000 to appellant. They did not. In addition, respondents were entitled to receive the $10,000 even if appellant did not obtain the approvals by April 5, 2009. Thus, the record fails to show respondents agreed to accept appellant's late performance. Accordingly, appellant remained liable for breach of the Agreement, and the trial court did not err in lifting the stay on the enforcement of the execution of the default judgment.
The order is affirmed. Respondents are awarded their costs on appeal.
EPSTEIN, P. J. and SUZUKAWA, J., concurs.
