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Court of Appeal, Sixth District, California.

Barbara J. TURNER, Cross–Complainant/Appellant, v. ARCHITECTURAL DESIGN GROUP, Cross–Defendant/Respondent.

No. H003735.

Decided: September 18, 1989

Patricia J. Van Horn, Robert E. Schulz, Crist, Griffiths, Schulz & Biorn, Palo Alto, for cross-complainant/appellant. Ernest Y. Sevier, Loraine P. Eber, Jan T. Chilton, Severson & Werson, San Francisco, for cross-defendant/respondent.

Barbara Turner appeals from a judgment entered after the trial court granted Architectural Design Group's motion for an order enforcing settlement under Code of Civil Procedure section 664.6.1  At a mandatory settlement conference held before a referee, Turner's counsel offered to settle with Architectural Design Group (ADG) for $20,000 and a waiver of ADG's mechanic's lien claim.   ADG subsequently accepted the offer.

In order to enforce an oral settlement under section 664.6, the stipulation for settlement must be made at a judicially supervised proceeding.   For reasons we shall explain, the settlement conference before the referee was not a judicially supervised proceeding.   Thus, the statutory prerequisites of section 664.6 were not met, and the court erred when it enforced the parties' alleged settlement under that section.2


This case involves a dispute arising from the construction of a condominium complex in Palo Alto, California.   During 1981 and 1982, several subcontractors filed actions against the developer of the complex, Barbara Turner, to foreclose on mechanics' liens.   Turner filed a cross-complaint in one of those actions, and the cases were subsequently consolidated.

On October 31, 1986, the general contractor, Vance M. Brown & Sons, Inc., filed a motion for an order designating the consolidated cases as “complex” and appointing a special master (hereafter “referee”) pursuant to Santa Clara County Local Rule 28.   On November 7, 1986, Turner filed her opposition to the motion for appointment of referee.   A hearing was held on November 14 at which time Turner reiterated her opposition to the motion.   Thereafter the court issued its order appointing a referee.   The court's order first stated that the “motion was opposed by Barbara Turner by and through her attorney, D. Gerald Brown” and then appointed retired Judge James DuVaras, Jr. as referee “for the purpose of conducting proceedings in this complex case, pursuant to CCP § 638–645.1, including settlement.”   Several mandatory settlement conferences were subsequently held, including one on May 19, 1987.

During the May 19 settlement conference, Turner's attorney, in the presence of Turner and the referee, offered to settle the case against ADG for $20,000 and a waiver of ADG's mechanic's lien.   ADG's attorney indicated that she “would have to speak with [her] client and the carrier before accepting the $20,000 settlement demand.”   She also stated that “any acceptance would be contingent upon a good faith settlement determination because other parties in the lawsuit had crossed-complained [sic] against ADG.”   Turner's attorney gave ADG until May 29 to accept.   On May 26, after getting the client's and the carrier's approval and assurance from cross-defendants that they would not oppose a good faith settlement motion, ADG accepted the offer.

In a declaration submitted in support of ADG's motion to enforce settlement, the referee stated:  “During that settlement conference, Gerry Brown, the attorney representing Barbara Turner, made a $20,000 settlement demand to ADG's counsel, Loraine Eber.   I was present when that settlement demand was made.   I specifically recall that Barbara Turner was also present when the settlement demand was made.   Ms. Turner did not voice any objection to that settlement demand.   I also recall that Gerry Brown told Loraine Eber that the settlement demand would remain open until May 29, 1987, the date on which the depositions were set to resume.   I have subsequently been informed by Loraine Eber that the settlement was accepted within that time period.”

When Turner refused to comply with the settlement terms, the trial court granted ADG's motion to enforce the settlement.


 To be enforceable under section 664.6, a stipulation for settlement must be either in writing and signed by both parties (see Gallo v. Getz (1988) 205 Cal.App.3d 329, 252 Cal.Rptr. 193) or made “orally before the court.”   The issue in this case is whether the offer made before the referee is an offer “before the court” within the meaning of section 664.6.   We conclude that it is not.

Article VI, section 22 of the California Constitution vests in the legislature the power to “provide for the appointment by trial courts ․ of officers such as commissioners to perform subordinate judicial duties.”   Like commissioners, referees are within the class of subordinate judicial officers.  (See In re Edgar M. (1975) 14 Cal.3d 727, 732–734, 122 Cal.Rptr. 574, 537 P.2d 406, disapproved on another ground in People v. Belton (1979) 23 Cal.3d 516, 531, 153 Cal.Rptr. 195, 591 P.2d 485 (conc. opn. of Jefferson, J., assigned by the Chairperson of the Judicial Council).)

 Where the parties consent to a reference, the referee is authorized to “try any or all of the issues in an action or proceeding․”  (§ 638;  Plant v. Fleming (1862) 20 Cal. 92, 93.)   On the other hand, where, as here, the parties do not consent to a general reference, the powers of the referee are limited to those enumerated in section 639.3  (See generally, 6 Witkin, Cal.Procedure (3d ed 1985) Proceedings Without Trial, §§ 47–48, pp. 361–363.)   This is because the “superior court has no power to assign matters to a referee for decision without explicit statutory authorization.  [Citations.]”  (Aetna Life Ins. Co. v. Superior Court (1986) 182 Cal.App.3d 431, 435, 227 Cal.Rptr. 460.)

 Traditionally, references have been classified either as “general” or “special.”   The significance of the distinction has important ramifications regarding the respective powers and duties of the referee and the appointing court.   In special references (those conducted pursuant to § 639), a referee makes “advisory” findings which do not become binding unless adopted by the superior court.   This is because a party's right to jury trial cannot be subject to unilateral erasure by a court or the other party.  (Cf. Smith v. Pollock (1852) 2 Cal. 92, 94.)   On the other hand, in general references (those conducted pursuant to § 638 and requiring consent of all parties), the referee is empowered to make a conclusive determination without further action by the court.  (See §§ 644, 645;  6 Witkin, Cal.Procedure (3d ed 1985) Proceedings Without Trial, §§ 47–51, pp. 361–365;  Estate of Bassi (1965) 234 Cal.App.2d 529, 536–537, 44 Cal.Rptr. 541;  Holt v. Kelly (1978) 20 Cal.3d 560, 562, 143 Cal.Rptr. 625, 574 P.2d 441.)

 Since no provision of section 639 authorizes a referee to conduct settlement proceedings, the reference for that purpose was not “before the court” within the meaning of section 664.6.  (Cf. Bird v. Superior Court (1980) 112 Cal.App.3d 595, 599–601, 169 Cal.Rptr. 530;  Sauer v. Superior Court (1987) 195 Cal.App.3d 213, 225–226, 240 Cal.Rptr. 489.)   The fact that the superior court's order allegedly delegated this power to the referee does not alter this result.   The superior court “has no power to assign matters to a referee for decision,” because such assignment would amount to an unconstitutional delegation of judicial power for other than the performance of subordinate judicial duties.  (Aetna Life Ins. Co. v. Superior Court, supra, 182 Cal.App.3d at 435–436, 227 Cal.Rptr. 460;  In re Perrone C. (1979) 26 Cal.3d 49, 160 Cal.Rptr. 704, 603 P.2d 1300;  In re Edgar M., supra, 14 Cal.3d 727, 122 Cal.Rptr. 574, 537 P.2d 406.)   Furthermore, this jurisdictional error cannot be purged by the parties' participation in the reference without objection to its scope.  (Sauer v. Superior Court, supra, 195 Cal.App.3d at pp. 225–226, 240 Cal.Rptr. 489.)   Nor can Turner's grudging acceptance of the reference after the court announced its decision to appoint a referee be deemed a consent to a general reference.4  A reference under section 638 requires that “the agreement of the parties [be] filed with the clerk, or judge, or entered in the minutes or in the docket․”  (§ 638;  see also Aetna Life Ins. Co. v. Superior Court, supra, 182 Cal.App.3d at p. 435, 227 Cal.Rptr. 460.)

Because the settlement offer in this case was not made at a judicially supervised proceeding, it may not be enforced under section 664.6.

The judgment is reversed.   Costs on appeal to appellant.


1.   All further statutory references are to the Code of Civil Procedure.

2.   A settlement agreement not in writing, nor made before the court, may be enforced in appropriate circumstances by an independent action to compel its enforcement or as a special defense by supplementary pleadings in the pending action.  (See Gregory v. Hamilton (1978) 77 Cal.App.3d 213, 217–218, 142 Cal.Rptr. 563.)   We express no opinion on whether either of these procedures might have been appropriate here.

3.   Section 639 provides:  “When the parties do not consent, the court may, upon the application of any party, or of its own motion, direct a reference in the following cases:  [¶ ] (a) When the trial of an issue of fact requires the examination of a long account on either side;  in which case the referees may be directed to hear and decide the whole issue, or report upon any specific question of fact involved therein.  [¶ ] (b) When the taking of an account is necessary for the information of the court before judgment, or for carrying a judgment or order into effect.  [¶ ] (c) When a question of fact, other than upon the pleadings, arises upon motion or otherwise, in any stage of the action.  [¶ ] (d) When it is necessary for the information of the court in a special proceeding.  [¶ ] (e) When the court in any pending action determines in its discretion that it is necessary for the court to appoint a referee to hear and determine any and all discovery motions and disputes relevant to discovery in the action and to report findings and make a recommendation thereon.”

4.   Counsel stated, “I don't really oppose the idea of a special master in the case if we had time to get him up to speed.”

COTTLE, Associate Justice.

AGLIANO, P.J., and ELIA, J., concur.