Facts

On Nov. 24, 2014, plaintiff C. Howard Wietschner and defendants, entered into a written agreement that provided that Jennifer Bell benefited from and agreed to be responsible for obligations of Gary Hoffman with respect to, loans made under promissory notes dated Oct. 2, 2014 and Oct. 28, 2014 in favor of plaintiff.

To secure its obligations pertaining to the notes, Bell contracted to grant to plaintiff a continuing security interest in and to all rights, but not obligations, all of the assets of Jennifer Bell, BellWether LLC, BellWether International, BellWether Consulting and any other entities affiliated with Jennifer Bell, together with all proceeds.

PLAINTIFF'S CONTENTIONS:
Hoffman was in default under the notes, and pursuant to the notes (including the interest accrued as well as additional fees and penalties), Bell owed in excess of $2 million to plaintiff. Plaintiff agreed that if on Nov. 25, 2014, it received payment from Bell in the amount of $1.8 million or $1.4 million, plaintiff would consider such payment (and the secured promissory note, if applicable) in full satisfaction of the amount due in respect of the notes. The payment was to be made together with a secured promissory note secured by the collateral of $600,000 with a maturity date of Jan. 23, 2015. The agreement also held that if any payments were not made in the amounts and at the times agreed to, Bell would immediately execute a Confession of Judgment in compliance with California State Law. Bell was to execute the confession of judgment together with any necessary documents or forms to cause the courts to enter judgments in the amount of $2 million (plus interest accrued on the notes and attorney fees) against Bell.

Plaintiff claimed Bell represented and warranted, and agreed to do all things necessary, at its expense, to continue to ensure, that plaintiff would have a first priority perfected security interest in the collateral. Plaintiff contended that he has at all times performed the terms of the agreement in the manner specified by the agreement.

Plaintiff claimed defendants failed to pay the monies set forth in the agreement, pursuant to the terms of the agreements. Despite numerous demands, both orally and in writing, the defendants failed to make all payments and remain in default. Plaintiff filed suit against defendants based on the breach of two written agreements, one written on Nov. 24, 2014, and another written Nov. 26, 2014, for a $2 million debt to plaintiff.

DEFENDANTS' CONTENTIONS:
Bell acknowledged and agreed that Hoffman had not made payments as required under the notes and, consequently, Hoffman was in default under the notes and that Bell was obligated to pay to plaintiff the amount of $2 million.

Result

Concurrently with the execution of the Letter Agreement, defendants agreed to sign and have notarized a stipulation for entry of judgment confessing to owing plaintiff $2 million and authorizing the superior court to enter a judgment against the defendant borrower in this amount, and paid $100,000 to plaintiff. Plaintiff filed an application for entry of judgment based on stipulation of the parties, granting a $1.9 million judgment for plaintiff.