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					Filed 5/24/07 Allen v. Mercedes-Benz USA CA5




                  NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS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 This opinion has not been certified for publication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

                                       FIFTH APPELLATE DISTRICT

JOHN ALLEN et al.,
                                                                                            F050083
         Plaintiffs and Appellants,
                                                                                   (Super. Ct. No. 8289)
                   v.

MERCEDES-BENZ USA, LLC,                                                                  OPINION
         Defendant and Respondent.



         APPEAL from a judgment of the Superior Court of Mariposa County. Donald G.
Umhofer, Judge.
         Anderson Law Firm and Martin W. Anderson for Plaintiffs and Appellants.
         Universal, Shannon & Wheeler, Jon D. Universal and Robert M. Shannon for
Defendant and Respondent.
                                                        -ooOoo-
                                                 INTRODUCTION
         Plaintiffs John and Sharilyn Allen prevailed on their claim against defendant
Mercedes-Benz USA, LLC (MBUSA) under the Song-Beverly Consumer Warranty Act
(Civ. Code,1 § 1790 et seq., “the Song-Beverly Act”), also popularly known as the

1        Further statutory references are to the Civil Code unless otherwise specified.
“lemon law.” On appeal, plaintiffs contend the trial court erred in awarding to MBUSA
an “equitable offset” for plaintiffs’ postverdict use of the subject vehicle. Plaintiffs also
contend the trial court erred in adding a provision to the judgment which requires
plaintiffs to return the vehicle to an authorized dealer identified in writing by MBUSA.
Finally, plaintiffs contend the trial court erred in failing to include in the judgment an
award of postjudgment interest. For reasons discussed below, we conclude that the trial
court erred in awarding MBUSA an offset for plaintiffs’ postverdict use of the vehicle
and reverse the offset award. But we conclude the court did not err in adding the
provision requiring MBUSA to designate the place of return of the vehicle. We further
conclude that the issue of plaintiffs’ entitlement to postjudgment interest is one more
appropriately addressed by the trial court on remand.
                                       BACKGROUND
       In late November 1999, plaintiffs purchased a new Mercedes-Benz C280 for
$49,000. The vehicle had a five-year/50,000-mile warranty. Within a few weeks of
purchase, the vehicle began to demonstrate electrical problems, which persisted despite
numerous repair attempts.2
       In March 2002, plaintiffs sued MBUSA for breach of express warranty under the
Song-Beverly Act. The case went to jury trial in February 2005. The jury returned with
a verdict in favor of plaintiffs.3 In its special verdict, the jury found MBUSA violated the
replace-or-repurchase provisions of the Song-Beverly Act, plaintiffs were entitled to
recover actual damages of $45,460.99, and the mileage on the vehicle was 14,454 miles
when it was first brought in for repair.

2      There is no recorder’s transcript of the jury trial in the record on appeal. Thus,
circumstances concerning the subject vehicle are taken from the allegations in plaintiffs’
complaint.
3       The record does not disclose the date the jury reached its verdict but MBUSA identifies
the date as February 25, 2005, in its brief on appeal.



                                                2.
       On March 28, 2005, the trial court signed and entered a proposed judgment
prepared by plaintiffs’ counsel. Plaintiffs failed to serve MBUSA with notice of entry of
judgment.
       On October 7, 2005, MBUSA filed a motion to vacate and enter a new judgment
under Code of Civil Procedure section 663 and requested sanctions against plaintiffs’
counsel under Code of Civil Procedure section 128.5. MBUSA argued that, while it did
“… not quarrel with the jury’s verdict …”, “… due to numerous procedural violations,
plaintiffs’ counsel caused an improper judgment to be entered by this court which
contained numerous errors .…”
       MBUSA asserted three errors in the judgment entered on March 28, 2005: (1) a
miscalculation, by approximately $20, of the statutory offset for plaintiffs’ use of the
vehicle prior to the first delivery for repair; (2) the incorporation of a memorandum of
costs, including an award of attorney’s fees, although the reasonableness thereof had not
been duly determined by the trial court; and (3) the absence of a provision for the return
of the vehicle in an undamaged condition save normal wear and tear.
       MBUSA also asserted that plaintiffs’ counsel should be sanctioned for her conduct
in connection with the entry of the March 28, 2005, judgment. According to defense
counsel, during a telephone conversation on March 17, 2005, plaintiffs’ counsel misled
him by representing that she had not yet filed the costs memorandum with the court, and
that she agreed MBUSA need not file a motion to tax costs; instead, she would submit
her time sheets to defense counsel, and they would try to resolve the issue without a
motion. Plaintiffs’ counsel also agreed that she would prepare a second proposed
judgment addressing the errors pointed out by defense counsel. Thereafter, defense
counsel did not hear from plaintiffs’ counsel for six months despite sending her follow-
up letters and making numerous attempts to contact her by telephone. During this six-
month period, defense counsel was unaware that the judgment and costs memorandum
plaintiffs’ counsel sent him on March 3, 2005, had also been submitted to the court the

                                             3.
same day, and subsequently signed and entered by the trial court on March 28, 2005.
The first time defense counsel learned the judgment had been entered was after receiving
a letter from plaintiffs’ counsel in late September, demanding that MBUSA satisfy the
judgment by early October. Although the letterhead showed plaintiffs’ counsel had
changed office locations, she had failed to provide defense counsel any notice of a
change of address.
       Based on the “egregious conduct” of plaintiffs’ counsel, MBUSA requested
sanctions of $1,500 against her under Code of Civil Procedure section 128.5. MBUSA
also argued that the judgment should be further reduced based on plaintiffs’ use of the
vehicle during the six-month period when plaintiffs’ counsel failed to communicate with
defense counsel. MBUSA argued that plaintiffs should not be allowed to benefit to
MBUSA’s detriment from the delay caused by their attorney’s “inappropriate absence.”
       In response to MBUSA’s allegations of misconduct, plaintiffs’ counsel submitted
a declaration disputing that she represented to defense counsel that she had not filed the
costs memorandum with the court or that she agreed to draft a second proposed judgment
addressing the errors he asserted, noting that she had expressed disagreement with some
of the language defense counsel insisted should be included in the judgment. She also
stated she could not recall agreeing to submit her time sheets to defense counsel. In her
declaration, plaintiffs’ counsel suggested that it was defense counsel’s responsibility to
file formal objections to the proposed judgment or a motion to tax costs. Plaintiffs’
counsel acknowledged that she failed to stay in contact with defense counsel during the
period after the judgment was entered and failed to serve MBUSA with notice of entry of
judgment but disputed the suggestion that she acted deliberately or in bad faith.
Plaintiffs’ counsel set forth personal circumstances, including the diagnosis of her best
friend with cancer, to explain her lack of communication and any dilatory handling of the
case on her part.



                                             4.
       The matter came on for hearing on January 30, 2006. The minute order reflects
the trial court ruled as follows:

              “The Court decided to construe Motion as one to correct clerical
       error under section 473 CCP, finding that the Judgment was not one
       [intended] by the Court, to wit, lack of recitation of special verdict,
       incorrect calculation of statutory offset and inclusion of dollar amounts re
       costs and attorney fees.

              “The Court will prepare a corrected Judgment; clerk to mail a filed
       copy therefore to counsel which shall be deemed notice of entry of
       judgment.

              “Plaintiffs may re-file their Memorandum of Costs and will follow
       section 1033.5(c)(5) CCP re section 1974(d) CC.

              “The Court indicated that it would entertain a defendant’s motion for
       a monetary offset against the judgment based on plaintiffs’ eleven-month
       continued use of the vehicle.

             “Defendants’ prayer for section 128.5 CCP attorney’s fees re the
       motion is denied. The section is super[s]eded by section 128.7 CCP.”
       The trial court prepared a new judgment which was filed on February 6, 2006.
The new judgment included a recitation of the special verdict, corrected the amount of
the statutory offset for plaintiffs’ use of the vehicle before it was first delivered for repair
(increasing it from $5,455.32 to $5,476), and included the following provision regarding
the return of the vehicle:

       “That Plaintiffs John Allen and Sharilyn Allen return the 2000 Mercedes-
       Benz C280 motor vehicle, the subject of this action, to a Mercedes-Benz
       authorized dealer, identified in writing by the Defendant. Return of the
       subject vehicle shall be concurrent with payment of the monetary
       judgment.”
       On April 3, 2006, the trial court heard MBUSA’s motion for an equitable offset
along with plaintiffs’ motion for attorney’s fees and MBUSA’s motion for judgment
notwithstanding the verdict/new trial, and motion to tax costs. The hearing was not
recorded.


                                               5.
       The minute order from the April 3, 2006, hearing reflects that the trial court
denied defendant’s motion for judgment notwithstanding the verdict and awarded
plaintiffs costs in the amount of $2,561.11, and attorney’s fees in the amount of $30,075.
With respect to the motion for an equitable offset, the trial court ruled as follows:

              “Defendant’s Motion for an Equitable Offset due to plaintiffs’ use of
       the subject vehicle after verdict and until the Motion for Judgment N.O.V.
       (12 months) is granted in the amount of $7,014.48, calculated based on the
       mileage of the vehicle in December, 2004, of 164,743; an average monthly
       mileage of 2,657 (164,743 divided by 62 months), and $0.22/mile IRS
       allowance for moving and medical.

              “The Court will allow a further offset of $0.22 for each mile over
       201,941 to date of satisfaction of judgment while on plaintiffs’ appeal;
       however, such offset shall be tolled from the date of any Defendants’
       appeal.”
       During the previous hearing on January 30, 2006, the trial court indicated that it
arrived at its estimation of plaintiffs’ monthly mileage based on their expert’s trial
testimony that in December 2004, the mileage on the vehicle was 164,743 miles, which
the court divided by the length of time plaintiffs had owned the vehicle. Because there is
no reporter’s transcript of the April 3, 2006, hearing, it is unclear why the trial court
decided to use a rate of 22 cents per mile to measure the offset award. However, it
appears that in its written motion for an equitable offset, MBUSA requested that the court
calculate the offset based on IRS “standard mileage rates” of 40.5 cents per mile and 48.5
cents per mile for the relevant time periods, and sought a total offset of $13,130.51
against plaintiffs’ damages. IRS documents attached to MBUSA’s motion include
references to a 22 cents per mile standard mileage rate for miles driven for medical or
moving purposes.
       On April 3, 2006, the trial court once again amended the judgment, this time to
reflect the offset award for plaintiffs’ postverdict use of the vehicle and potential future
use. The amended judgment was filed the same day.



                                              6.
       On April 20, 2006, plaintiffs timely filed a notice of appeal from the minute order
and the amended judgment entered on April 3, 2006.4
                                         DISCUSSION
I.     Equitable offset for plaintiffs’ postverdict use of vehicle
       Numerous points are debated by counsel but the primary question on appeal is
whether the trial court erred in granting MBUSA’s motion for an equitable offset based
on plaintiffs’ postverdict use of the vehicle. Because it appears the court could not
properly invoke its equity powers to grant the relief sought by MBUSA, we reverse the
offset award.
       A.       Background
       MBUSA’s request for an offset was first made in its motion to vacate and enter a
new judgment. MBUSA cited no legal authority in support of the offset request but
asserted that plaintiffs should not be allowed to benefit from the use of the car during the
six-month period their attorney failed to communicate with defense counsel after the
judgment was entered without notice to MBUSA.
       During the hearing on MBUSA’s motion to vacate the judgment on January 30,
2006, the trial court’s comments towards the beginning indicated that it was inclined
towards granting an offset to MBUSA, but not because of the numerous instances of
alleged misconduct by plaintiffs’ counsel detailed by defense counsel in the moving
papers and reiterated on appeal. Rather, the trial court appeared to take the position that
MBUSA should get “some kind of consideration” for the fact the vehicle that would
finally be returned to MBUSA would have incurred considerable mileage since the time




4       Plaintiffs also purport to appeal from the judgment entered on February 6, 2006, and seek
modification to the earlier judgment, as well as the later one. Our review, of course, is limited to
the final judgment entered on April 3, 2006.



                                                 7.
MBUSA originally offered to buy it back from plaintiffs in 2000, as a result of to
plaintiffs’ continuing use of the vehicle throughout the litigation.5
       Plaintiffs’ counsel responded to the court’s comments on the plaintiffs’ continued
use of the vehicle by noting: “They’re [sic] are cases that say if the [L]egislature had
intended to charge purchasers for miles put on after the problems were discovered, the
nonconformities were discovered, they would have said so. [¶] And yet the [L]egislature
specifically said that the manufacturer is entitled to an offset only for those miles put on
the vehicle prior to the discovery of the nonconformity.” (See e.g., Jiagbogu v.
Mercedes-Benz USA (2004) 118 Cal.App.4th 1235, 1242-1244 (Jiagbogu) [rejecting
manufacturer’s contentions that buyback request under Song-Beverly Act amounts to
contract rescission, and that trial court should have instructed jury that manufacturer was
entitled to postrescission offset for buyer’s continued use of vehicle after he requested a
buyback, or that trial court should have exercised its “equity powers” to grant an offset
for such use].)



5       We gather this was the court’s position from its following commentary on plaintiffs’ use
of the vehicle: “Now, what strikes me over the life of this case is that, of course, the purchase
was in November of ’99. They had their problems in 2001. [¶] In 2002 the lawsuit is filed.
They go through one or two attorneys. The case doesn’t get tried until 2005. They’re still
driving it. [¶] It has got 164,000 miles on it as of December of 2004. Then they get their
judgment, literally whether it’s their fault or not, don’t do anything with that judgment for six
months, and now we are kind of at the 11-month after the verdict. Still driving it. [¶] And my
calculation was that over the 62 months, that from the time they owned it until there was an
expert that looked at it in December of 2004, and that’s where it is getting the 164,000 mile
figure from. [¶] They put on 2650 miles a month. So if they are still driving it that much over
the period of time since they got their verdict, and got their judgment, they have put on another
almost 30,000 miles. [¶] Why should Mercedes have offered these people a brand new car,
years ago in 2002 or something. [¶] … [¶] They keep driving this car. They keep driving this
car. Litigation gets dragged out to the point of trial. Now it gets dragged out to the point of
Judgment. [¶] He is still driving the car. He has put on 102, 100,000 miles on this car since he
had his problem. Why shouldn’t they, Mercedes, get some kind of consideration for the fact
they’re getting a car now back 200,000 miles on it [if] they offered to buy back from him in
2000--”



                                                8.
      The trial court then shifted its focus to plaintiffs’ postverdict use of the vehicle,
yielding the following discussion:

              “THE COURT: … So anyway, at any rate back to it’s agreed that
      now the trial happened. The jury made their finding of 14,454, resulting in
      the statutory offset.

             “But they have driven it for almost another year.

             “[PLAINTIFFS’ COUNSEL]: Your Honor, to just pull a figure out
      of the air and say we are going to sanction these people for driving the car
      even though Mercedes wouldn’t pay the judgment and hadn’t done
      anything.

             “THE COURT: They didn’t know about the Judgment.

             “[PLAINTIFFS’ COUNSEL]: They knew that a Judgment had been
      presented to the Court.

            “THE COURT: They didn’t know that one was signed. They didn’t
      know they had to pay that yet.

            “[PLAINTIFFS’ COUNSEL]: If they were concerned about not
      having a Judgment, they could have always drafted one themselves.

             “There are a lot of things that the defense could have done and
      didn’t do. They – if I sat on it, they certainly sat on it, too.

            “So how can they come in, and even if a sanction were imposed, it
      should not be part of the Judgment.

             “THE COURT: I am not calling it a sanction. [¶] … [¶]

              “THE COURT: … But I think that Mercedes could ask for an offset
      against the amount that they owe on the Judgment or some amount which
      reflects 25,000 more miles use. I would certainly entertain that.

             “[PLAINTIFFS’ COUNSEL]: Well –

             “THE COURT: If they keep using it –

              “[PLAINTIFFS’ COUNSEL]: What are they suppose to do? They
      bought – they put all their money into their car, put $45,000.00 cash into
      this car.


                                             9.
      “And when we get a Judgment, and Mercedes is suppose to give
them back their $45,000 less a statutory offset … they don’t get paid their
money. They don’t have money to buy another car. So do they – do they
walk?

      “THE COURT: They have to – we can setup an escrow situation or
whatever, but they have got to tender the car at or near the time that
Mercedes has to pay the judgment. So –

      “[PLAINTIFFS’ COUNSEL]: But Mercedes was demanding that –
maintained discretionary ability to determine what was reasonable use.

       “Now this – I have never seen that term in a Lemon Law. I have
seen a lot of Lemon Law Judgments.

       “THE COURT: I am not purporting to suggest that. But what if
they took the car and ran it over a cliff, you have got to have some
reasonable return of the vehicle. Was it –

       “[PLAINTIFFS’ COUNSEL]: Get the insurance money.

       “[DEFENSE COUNSEL]: Subject to negotiations, but –

       “THE COURT: But the insurance money would have been a lot less
on a 195,000 mile car that this would have been on a 170,000 mile car.

        “[PLAINTIFFS’ COUNSEL]: There’s nothing in the Lemon Law
that limits how a purchaser can use a car. That’s the gist of the recent
decisions. The decisions that have come down in the last couple of years.

        “THE COURT: I understand, but the whole point of our being here
at this time 11 months post-trial is I am finding that Plaintiff’s at fault.
They were – they did not even – they were never served a document called
Notice of Entry of Judgment. I have looked in the file for it.

       “[PLAINTIFFS’ COUNSEL]: They weren’t –

        “THE COURT: And [defense counsel] never said that he received
one. And so the first informal notice that they have is your September
letter.

      “And then they have got to set their motion. And you don’t get the
motion. You get a continuance because you are out of the office.




                                     10.
            “You wait for [defense counsel]. We are here 11 months later and
      25,000 miles later. I hate to lay it all on you, [plaintiffs’ counsel], but –

             “[PLAINTIFFS’ COUNSEL]: Okay. [¶] … [¶]

              “THE COURT: … Anyway I am not proposing to decide this today,
      but what I’m suggesting is that I will entertain a motion by Mercedes-Benz
      for some kind of offset against the $39,984.99 that they – so the judgment
      will reflect.

             “We have got to get together again. Now, they can stop all this by
      bringing the car into some designated Mercedes dealer.

             “[Defense counsel], you want the car?

            “[DEFENSE COUNSEL]: Well, I would still like the opportunity to
      make some post-trial motions.

             “THE COURT: Of course. [¶] … [¶]

             “THE COURT: They need a car. So we can have at such time as
      Mercedes decides it’s willing to pay the judgment, then we can set up some
      kind of procedure whereby there’s somebody standing there with a check,
      when they drive the car in. And –

             “[PLAINTIFFS’ COUNSEL]: That’s what is usually done.

            “THE COURT: Yes. Right. But in the meantime, if you do a
      motion for new trial, and the appeal, then I’m not – I’m going to toll the
      running of the mileage offset.

             “[DEFENSE COUNSEL]: That’s fine.”
      Following the January 30, 2006, hearing, MBUSA filed a motion for equitable
offset. MBUSA presented no legal authority or legal argument in support of the motion.
The only evidence presented in support of the motion was a declaration by defense
counsel, which set forth the estimated additional mileage on the vehicle as 30,000 miles,
and a method for calculating an offset of $13,130.51.
      Plaintiffs opposed the motion, arguing that the offset sought by MBUSA was
precluded under the court’s reasoning in Jiagbogu, supra, 118 Cal.App.4th. 1235, and



                                            11.
that the only offset available to MBUSA was for its use of the vehicle prior to the first
delivery for repair.
       MBUSA responded that Jiagbogu was distinguishable because, in this case,
MBUSA was not claiming to be entitled to an offset for the use of the vehicle after the
time it was first brought in for repair to the time of trial. Rather, “per invitation of [the
trial court], [MBUSA] seeks only a further equitable mileage offset between March 1,
2005 and January 30, 2006, which represents a further delay due solely to the fault of
plaintiffs and their legal counsel for failing to obtain an appropriate judgment in this case
and serve it upon defendant.”
       As noted above, the April 6, 2006, hearing on the motion was not recorded. The
court employed its own method for reaching an offset award of $7,014.48, and then
amended the judgment to add the award plus a potential offset for future use.
       B.     Analysis
       The parties do not dispute that there is no specific statutory basis for the offset
awarded in this case. Plaintiffs argue that under the court’s reasoning in Jiagbogu, the
offset for postverdict use violated the Song-Beverly Act, which allows an offset only for
a buyer’s use of a vehicle before the first delivery for repair. MBUSA counters that the
Song-Beverly Act and Jiagbogu are inapplicable: “The post-verdict offsets [in this case]
… have nothing to do with the Song-Beverly Act. Those offsets are meant to address the
wrongful conduct of counsel for Appellants after the Song-Beverly Act litigation had run
its course and concluded in favor of Appellants.” MBUSA argues that in awarding an
offset, the court was properly exercising its “broad power to fashion equitable remedies
to address irregularities in the proceedings before it .…”
       MBUSA is correct that, generally speaking, “[t]rial courts have broad equitable
power to fashion any appropriate remedies. [Citation.] In doing so, they may consider
any unjust or harsh results, and adopt means to avoid them. [Citation.] ‘Equitable relief
is by its nature flexible, and the maxim allowing a remedy for every wrong [citation] has

                                              12.
been invoked to justify the invention of new methods of relief for new types of wrongs.
[Citation.]’” (Shapiro v. Sutherland (1998) 64 Cal.App.4th 1534, 1552.)
       However, “‘“‘[r]ules of equity cannot be intruded in matters that are plain and
fully covered by positive statute [citation]. Neither a fiction nor a maxim may nullify a
statute [citation]. Nor will a court of equity ever lend its aid to accomplish by indirection
what the law or its clearly defined policy forbids to be done directly [citation].’
[Citation.]” [Citation.]’” (Timberline, Inc. v. Jaisinghani (1997) 54 Cal.App.4th 1361,
1368, fn. 5.)
       The Jiagbogu court’s analysis of the offset provision contained in the Song-
Beverly Act is instructive on the question here of whether the trial court could properly
invoke its equity powers to grant the offset requested by MBUSA for plaintiffs’
postverdict use of the vehicle:

                “The Act does not address ‘post-rescission’ offsets of the sort to
       which MBUSA claims to be entitled. But it does specifically provide for an
       offset in one situation: where the buyer uses a nonconforming vehicle
       before the vehicle is first delivered to the manufacturer for correction of the
       nonconformity. Section 1793.2, subdivision (d)(2)(C) provides, ‘When the
       manufacturer replaces the new motor vehicle ..., the buyer shall only be
       liable to pay the manufacturer an amount directly attributable to [the
       buyer’s use before first delivery for correction]. When restitution is made
       ..., the amount to be paid by the manufacturer to the buyer may be reduced
       by the manufacturer by that amount directly attributable to [the buyer’s use
       before first delivery for correction].’ The subdivision then sets out a
       formula for calculating the offset for use before first delivery. This
       situation does not fit the case before us, where the buyer used the vehicle
       after the manufacturer refused to replace it or buy it back. [¶] … [¶]

               “Section 1793.2, subdivision (d)(2)(C), and (d)(2)(A) and (B) to
       which it refers, comprehensively addresses replacement and restitution;
       specified predelivery offset; sales and use taxes; license, registration, or
       other fees; repair, towing, and rental costs; and other incidental damages.
       None contains any language authorizing an offset in any situation other
       than the one specified. This omission of other offsets from a set of
       provisions that thoroughly cover other relevant costs indicates legislative
       intent to exclude such offsets. [Citation.]

                                             13.
               “This exclusion, far from being absurd as MBUSA argues, is in
       keeping with the Act’s overall purpose. The Act is intended to protect
       consumers and should be construed in keeping with that goal. [Citation.]
       Interpretations that would significantly vitiate a manufacturer’s incentive to
       comply with the Act should be avoided. [Citation.] As we have seen, the
       Act places an affirmative duty on the buyer to deliver a nonconforming
       product for repair, and an affirmative duty on the manufacturer to promptly
       replace the product or refund the purchase money if repairs are
       unsuccessful after a reasonable opportunity to repair. [Citations.] The
       predelivery offset creates an incentive for the buyer to deliver a car for
       repairs soon after a nonconformity is discovered. An offset for the buyer’s
       use of a car when a manufacturer, already obliged to replace or refund,
       refuses to do so, would create a disincentive to prompt replacement or
       restitution by forcing the buyer to bear all or part of the cost of the
       manufacturer’s delay. Exclusion of such offsets furthers the Act’s
       purpose.” (Jiagbogu, supra, 118 Cal.App.4th at pp. 1242-1244, italics
       added.)
       We recognize that the offset awarded to MBUSA in this case was requested on
different grounds and for different time periods than the offset in Jiagbogu. However,
the court’s statutory analysis is still pertinent. That a buyer would still have the vehicle
in his or her possession at different stages of a lemon law action, including during
posttrial proceedings, and incur additional mileage is a circumstance that was not
unpredictable. By specifically including only one type of offset in its comprehensive,
pro-consumer provisions, the Legislature evinced an intention to exclude other types of
offsets in actions under the Song-Beverly Act. While we do not approve of plaintiffs’
failure to serve MBUSA with notice of entry of judgment, or plaintiffs’ counsel’s failure
to stay in contact with defense counsel, under the principles set forth above, the trial court
could not properly invoke its equity powers to award an offset for plaintiffs’ postverdict
use where the relevant statute reflected a legislative intent to limit situations where an
offset would be available to the manufacturer. Accordingly, the trial court’s award of an
offset for plaintiffs’ postverdict use of the vehicle, including the potential offset for future
use, and the corresponding provisions in the judgment, must be reversed.




                                              14.
       However, even had the statute’s coverage of the offset available to the
manufacturer not precluded the court from invoking its equity jurisdiction, we question
whether MBUSA would be entitled to equitable relief under the circumstances. None of
the authorities MBUSA cites on appeal supports a conclusion that the trial court could
exercise its “broad power to fashion equitable remedies” simply to address plaintiffs’
failure to serve notice of entry of judgment, which, notwithstanding MBUSA’s assertion
to the contrary, is the only “procedural irregularity” the trial court specifically found to
have occurred in this case.
       Moreover, contrary to MBUSA’s suggestion, MBUSA was not denied the
opportunity to challenge the judgment entered on March 28, 2005, including the
erroneous attorney’s fee award. Each of the errors MBUSA perceived in the original
judgment were raised to and addressed by the trial court, apparently to MBUSA’s
satisfaction at the time. At oral argument, however, defense counsel attempted to raise
the issue of attorney’s fees as a completely new basis justifying the offset award. We are
of course not required to consider a matter raised for the first time at oral argument, and it
may be deemed waived. (Kinney v. Vaccari (1980) 27 Cal.3d 348, 356-357, fn. 6.)
Nonetheless, we find no record support for defense counsel’s suggestion that MBUSA
was deprived a full and fair opportunity to challenge plaintiffs’ claim to attorney’s fees.
The issue of attorney’s fees and costs appears to have been duly litigated after the new
judgment was entered on February 6, 2006, and MBUSA has not appealed the trial
court’s April 3, 2006, order awarding attorney’s fees.
       Defense counsel’s assertion during oral argument highlights a more fundamental
flaw in the overall theory advanced in support of MBUSA’s request for an equitable
offset against plaintiffs’ judgment; that is the notion that conduct of plaintiffs’ counsel –
as opposed to any wrongdoing on the part of plaintiffs – was sufficient to allow the trial
court unfettered discretion to fashion an equitable remedy penalizing plaintiffs for the
alleged misconduct of their attorney. No authority cited by counsel supports such a

                                             15.
theory. The remedy available to MBUSA was to seek sanctions against plaintiffs’
counsel.
II.    Return of the vehicle
       Plaintiffs do not challenge the provision requiring them to return the vehicle to
MBUSA, acknowledging “[s]uch a requirement is implicit in a judgment awarding
restitution [under the Song-Beverly Act] and thus making it explicit was merely
correcting a clerical error and not changing the substantive rights of the parties.”
However, they contend that the provision allowing MBUSA to designate, in writing, the
dealership where the vehicle is to be returned and making the return of the vehicle and
payment of the judgment concurrent, adversely affects their substantive rights, and, the
trial court was thus without jurisdiction to add the provision in the guise of making a
clerical correction to the original judgment under Code of Civil Procedure section 473.
Plaintiffs argue that the provision affects their substantive rights because it conceivably
allows MBUSA “to avoid enforcement of the judgment forever” by not designating a
dealership or by designating a dealership that is geographically unfeasible.
       We find plaintiffs’ argument unconvincing. It is true that “[a]n amendment that
substantially modifies the original judgment or materially alters the rights of the parties,
may not be made by the court under its authority to correct clerical error, therefore,
unless the record clearly demonstrates that the error was not the result of the exercise of
judicial discretion. [Citations.].” (In re Candelario (1970) 3 Cal.3d 702, 705.) In our
view, the complained-of provision does not substantially modify the original judgment or
materially alter the rights of the parties but simply provides a means for giving effect to
the requirement that plaintiffs return the vehicle to MBUSA, which plaintiffs do not
dispute was properly added to the judgment. As such, it reflects a valid exercise of the
trial court’s power to make necessary orders to enforce or give effect to its judgment.
(See Code Civ. Proc., § 128.) If, as plaintiffs speculate, MBUSA fails to act reasonably
or in good faith in complying with this provision, the proper arena to raise this issue will

                                             16.
be the trial court in enforcement proceedings. Contrary to plaintiffs’ suggestion, there is
nothing in the language of the provision that precludes them from taking action to
enforce the judgment if MBUSA tries to avoid satisfying the judgment by failing to
designate a dealership or doing so in such a way to make impracticable the plaintiffs’
return of the vehicle.
III.   Postjudgment interest
       Finally, plaintiffs challenge the trial court’s failure to include in the judgment an
award of postjudgment interest. MBUSA does dispute plaintiffs are entitled
postjudgment interest as a matter of statute. The disagreement is essentially over when
postjudgment interest began to accrue. Plaintiffs contend, on the one hand, that
postjudgment interest began accruing on the date of the entry of the original judgment on
March 28, 2005. On the other hand, MBUSA argues that postjudgment interest began
accruing on the date of the entry of the final judgment on April 6, 2006, based on its
argument, noted above in footnote 4, that the original judgment was void. For reasons
discussed below, we conclude the issue of when postjudgment began to accrue is one
more appropriately addressed by the trial court on remand.
       “A judgment need not expressly provide for postjudgment interest; by statute,
interest at an annual rate of 10 percent generally accrues on the principal amount of every
money judgment from the date of entry until the judgment is satisfied. [Citation.]”
(Matthew Bender Practice Guide: Cal. Trial & Post-Trial Civil Procedure (2006) Entry
of Judgment, § 26.18(5)(e).) Thus, Code of Civil Procedure section 685.010, subdivision
(a) provides: “Interest accrues at the rate of 10 percent per annum on the principal
amount of a money judgment remaining unsatisfied.” Code of Civil Procedure section
685.020, subdivision (a) provides: “Except as provided in subdivision (b), interest
commences to accrue on a money judgment on the date of entry of the judgment.”
       Ordinarily, we would agree with plaintiffs’ position that they are entitled to
postjudgment interest from the date of the entry of the original judgment on March 28,

                                             17.
2005. (See e.g., Ehret v. Congoleum Corp. (2001) 87 Cal.App.4th 202 (Ehret) [plaintiffs
entitled to postjudgment interest from date of original judgment on jury’s verdict, rather
than from modified judgment following remittitur on defendant’s appeal]; see also Jones
v. World Life Research Institute (1976) 60 Cal.App.3d 836, 848 [“There can be no
interest on a judgment prior to its rendition and entry”].) However, it appears from the
parties’ discussion on the record during the January 30, 2006, hearing, that they agreed to
treat the later corrected judgment as if it were the original judgment at least for certain
purposes.
       During the hearing, the trial court asked the attorneys whether they accepted the
trial court’s approach to treat the motion to vacate the judgment as a motion to correct
clerical error and both attorneys indicated that they did. Plaintiffs’ counsel then asked
whether this would extend the time for filing her motion for attorney’s fees and costs.
The following pertinent discussion ensued:

              “THE COURT: What’s your position on that?

              “[DEFENSE COUNSEL]: I was of the impression if there had been
       a new judgment, then things would sort of start anew.

              “It wasn’t the intent to cut off anybody’s rights here. Just get it
       right. Let’s proceed from … there.

              “[PLAINTIFFS’ COUNSEL]: But, your Honor, indicated that
       you’re not vacating the judgment. Merely, correcting it.

              “THE COURT: Yes.

            “[PLAINTIFFS’ COUNSEL]: So we are treating that as a new
       judgment?

              “THE COURT: We can agree amongst ourselves to do that.

              “[PLAINTIFFS’ COUNSEL]: That’s fine.”
Later in the hearing, the parties also appeared to agree that the time for the defense to file
its posttrial motions would begin to run from the time of service by the clerk of copies of


                                             18.
the new judgment. However, it is not clear whether the parties’ apparent agreement to
treat the corrected judgment as a new judgment also encompassed the issue of
postjudgment interest as it was not expressly discussed. Because we cannot resolve on
this record the issue of whether the parties intended to treat entry of the later judgment as
if it were the entry of the original judgment for purposes of the accrual of postjudgment
interest, we conclude that this is an issue better decided by the trial court on remand.
       Plaintiffs also claim to be entitled to an award of interest for the postverdict period
preceding the entry of judgment. Plaintiffs rely on California Rules of Court, rule 8756
(“rule 875”), which provides: “The clerk must include in the judgment any interest
awarded by the court and the interest accrued since the entry of the verdict.”
       In Ehret, supra, 87 Cal.App.4th 202, in noting the existence of a “technical
variation in the language” of Code of Civil Procedure section 685.020 and rule 875, the
Court of Appeal stated: “The former calls for postjudgment interest from the entry of the
judgment, while the latter calls for interest from the entry of the verdict. The language of
rule 875 follows the language of former [Code of Civil Procedure] section 1033, which
called for interest from the date the verdict was rendered.” (Ehret, supra, 87 Cal.App.4th
at p. 208, fn. 2.) However, the court in Ehret did not decide whether the statute or the
rule controlled since the “difference in the two provisions” was “immaterial” given the
fact that the verdict there was reached on one day and judgment on the verdict was
entered the following day. (Ibid.)
       Here, we conclude Code of Civil Procedure section 685.020 prevails over rule
875. (Cal. Const., art. VI, § 6 [rules adopted by the Judicial Counsel “shall not be
inconsistent with statute”].) Accordingly, plaintiffs are not entitled to interest during the
period between the entry of verdict and entry of judgment.


6      Former rule 875 is now renumbered as rule 3.1802.



                                             19.
                                      DISPOSITION
       The court’s order and the provision in the judgment awarding defendant MBUSA
an offset of $7,014.48 for plaintiffs’ postverdict use of the vehicle plus an offset for
future use is reversed, and the cause remanded with instructions to determine plaintiffs’
entitlement to, and make an award of, postjudgment interest. Otherwise, the judgment is
affirmed. Plaintiffs shall recover costs on appeal but their motion for attorney’s fees is
denied.


                                                                  _____________________
                                                                                 HILL, J.
WE CONCUR:


 _____________________
CORNELL, Acting P.J.


 _____________________
DAWSON, J.




                                             20.

				
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