Retail Clerks Union Joint Pension Trust v. Freedom Food Center, Inc.

• Decision Date: 03 July 1991
• Docket Number: No. 90-15622,90-15622
• Citation: 938 F.2d 136
• Parties: 119 Lab.Cas. P 10,821, 19 Fed.R.Serv.3d 1483 RETAIL CLERKS UNION JOINT PENSION TRUST, Trustees Retail Clerks Union Joint Pension, et al., Plaintiffs-Appellees, v. FREEDOM FOOD CENTER, INC., a California Corporation d.b.a. Freedom Food Center, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 136

938 F.2d 136

119 Lab.Cas. P 10,821, 19 Fed.R.Serv.3d 1483

RETAIL CLERKS UNION JOINT PENSION TRUST, Trustees Retail Clerks Union Joint Pension, et al., Plaintiffs-Appellees, v. FREEDOM FOOD CENTER, INC., a California Corporation d.b.a Freedom Food Center, Defendant-Appellant.

No. 90-15622.

United States Court of Appeals Ninth Circuit.

Argued and Submitted June 12, 1991.

Decided July 3, 1991.

Jay R. Oliff, Everton & Oliff, San Jose, Cal., for defendant-appellant.

Fred D. Lonsdale, Barry S. Jellison, Davis, Cowell & Bowe, San Francisco, Cal., for plaintiffs-appellees.

Appeal from the United States District Court for the Northern District of California.

Before BEEZER, NOONAN and FERNANDEZ, Circuit Judges.

BEEZER, Circuit Judge:

Freedom Food appeals the denial of its motion to vacate a stipulated judgment on the ground that the stipulation was signed on its behalf by a non-lawyer. We affirm.

I

Freedom Food Center, Inc. was party to a collective bargaining agreement obligating it to contribute to employee benefit plans. Plaintiffs are the trustees of those plans. Beginning in October 1987, Freedom stopped making the required payments to the plans. The trustees' claim for delinquent contributions was set for arbitration in June 1988.

Henry Wat was vice-president of Freedom Foods and had responsibility for operations and financial matters. Wat retained Bruce H. Conhain, a member of an industrial relations consulting firm that had previously assisted Freedom, to advise him regarding a possible workout arrangement with Plaintiffs. Plaintiffs told Conhain that they would cancel the arbitration if Freedom consented to a stipulated judgment holding Freedom liable to the Plaintiffs for the full balance of the outstanding contributions, plus interest. Plaintiffs sent a proposed stipulation to Conhain, along with an explanatory letter addressed to "Bruce H. Conhain, Esq." The proposed stipulation had a space designated for the signature of "Bruce H. Conhain, Esq./Attorney for Defendant." Conhain forwarded the proposed stipulation and Plaintiffs' letter to Wat. In his cover letter to Wat, Conhain stated: "I would like to sign this on your behalf as quickly as possible."

Plaintiffs contend that Wat agreed to the terms of the stipulation. Wat states only that he

concluded that Conhain was representing Freedom Food as an attorney at law and recommending that Freedom Food consent to the stipulation on the basis of an independent evaluation of the consequences of the proposed judgment which involved employing the expertise and experience associated with an attorney versed in labor relations matters.

A complaint was filed in district court on November 3, 1988. The action was based on the collective bargaining agreement, the Labor Management Relations Act and the Employee Retirement Income Security Act. The Stipulation for Entry of Judgment, signed by Bruce H. Conhain in the place designated for the signature of "Bruce H. Conhain, Esq.," was filed December 9, 1988. Judgment pursuant to the stipulation was entered December 12, 1988.

After Freedom continued to fail to make payments, a writ was executed on June 20, 1989. On December 8, 1989, Freedom filed a motion for an order vacating judgment pursuant to Fed.R.Civ.P. 60(b) and dismissing the action on the ground that the judgment was void because the stipulation was signed by a representative of the defendant who was not an attorney. The district court denied the motion and Freedom appeals.

II

We review denial of a motion to vacate pursuant to rule 60(b) for abuse of discretion. Alexander v. Robertson, 882 F.2d 421, 423 (9th Cir.1989). However, we review de novo denial of a 60(b)(4) motion to set aside a judgment as void, because the question of the validity of a judgment is a legal one. United States v. Holtzman, 762 F.2d 720, 724 (9th Cir.1985).

Freedom argues that the issue of the validity of the judgment should be determined by reference to California law. This is a judgment in a case based on federal law, however, and federal law controls with respect to both substance and procedure. See Erie Railroad Co. v. Tompkins, 304 U.S. 64, 78-79, 58 S.Ct. 817, 822, 82 L.Ed. 1188 (1938). The fact that the stipulation was entered prior to the filing of the complaint does not change this conclusion. The stipulation was at all times addressed to the United States District Court. Furthermore, even if the stipulated judgment could be considered a confessed judgment for purposes of California law, the entry of a confessed judgment is "a matter of procedure where the federal rules govern." Alland v. Consumers Credit Corp., 476 F.2d 951, 954 (2d Cir.1973); see also Bowles v. J.J. Schmitt & Co., 170 F.2d 617, 620 (2d Cir.1948) (although judgment was executed prior to commencement of proceedings and did not comply with state statutory requirements, whether entry of judgment is proper is matter of procedure in which federal rules govern).

Freedom's assertion that the judgment is void is based on the fact that it was signed on Freedom's behalf by a non-attorney. The fact that a non-attorney represented a party in a judicial proceeding does not render the resulting judgment void per se. See Alexander, 882 F.2d 421 (district court's denial of motion to vacate judgment on the basis of fraud (60(b)(3)) not an abuse of discretion despite the fact that appellant's trial counsel was unlicensed); cf. Scandia Down Corp. v. Euroquilt, Inc., 772 F.2d 1423 (7th Cir.1985) (although a corporation may not appear pro se, district court's denial of appellant's motion for new trial is not reversible error even though appellant corporation was represented at trial by its non-attorney president), cert. denied, 475 U.S. 1147, 106 S.Ct. 1801, 90 L.Ed.2d 346 (1986); E.E.O.C. v. Safeway Stores, Inc., 611 F.2d 795, 800 (10th Cir.1979) (consent decree not void even if it violates federal law), cert. denied, 446 U.S. 952, 100 S.Ct. 2918, 64 L.Ed.2d 809 (1980).

The case most closely on point is Alexander v. Robertson, 882 F.2d 421 (9th Cir.1989), in which an unsuccessful cross-claimant appealed the denial of his Rule 60(b)(3) motion to vacate on the basis of fraud. His motion was based on the fact that the cross-defendants were represented at trial by a non-licensed attorney. Although the motion was denied on the basis that there was no fraud by a "party," as required by Rule 60(b)(3), we examined the same California cases relied upon in the present case by Freedom...