Judge: Anne Hwang, Case: 23STCV05334, Date: 2024-08-15 Tentative Ruling

Case Number: 23STCV05334    Hearing Date: August 15, 2024    Dept: 32

PLEASE NOTE:   Parties are encouraged to meet and confer concerning this tentative ruling to determine if a resolution may be reached.  If the parties are unable to reach a resolution and a party intends to submit on this tentative ruling, the party must send an email to the Court at sscdept32@lacourt.org indicating that party’s intention to submit.  The email shall include the case number, date and time of the hearing, counsel’s contact information (if applicable), and the identity of the party submitting on this tentative ruling.  If the Court does not receive an email indicating the parties are submitting on this tentative ruling and there are no appearances at the hearing, the Court may place the motion off calendar or adopt the tentative ruling as the order of the Court.  If all parties do not submit on this tentative ruling, they should arrange to appear in-person or remotely.  Further, after the Court has posted/issued a tentative ruling, the Court has the inherent authority to prohibit the withdrawal of the subject motion and adopt the tentative ruling as the order of the Court. 

TENTATIVE RULING

BACKGROUND

This is a consolidated action regarding a multi-vehicle collision on the I-5 freeway. On August 1, 2023, Plaintiff James Burley (“Burley”) filed a complaint against Steven Rangel, Terry L. Hunsicker, Nandha Transport, and Does 1 to 100.

On June 14, 2024, Steven Rangel (“Rangel”) filed an Application for Determination of Good Faith Settlement (“Application”) with Burley, for $100,000.

Defendants/Cross-Complainants Nandha Transport Inc. and Terry Lee Hunsicker (“Defendants”) now move contesting the Application. Rangel opposes and Defendants reply.

The Court notes that Rangel’s opposition was due August 2, 2024, but was filed August 8, 2024. Although not discussed in the opposition memorandum, the declaration of Anna Sargsyan, Rangel’s counsel, states that the motion was not served to her email address. (Sargsyan Decl. ¶ 7.) Sargsyan states that during Rangel’s deposition on July 17, 2024, she informed the parties that the former handling attorney had left the firm and asked that they re-serve any motions filed over the last four weeks. She asserts that nothing was re-served, and that she discovered this motion accidentally on July 31, 2024. As a result, she requests more time to provide additional evidence to oppose this motion.

While the deposition testimony shows that Defendants’ counsel stated he would re-serve the motion, he also verbally informed Rangel’s counsel that a motion had been filed following the application for good faith settlement. (Sargasyan Decl., Exh. B, Depo. at 126.) Additionally, the Court notes that no Notice of Change of Handling Attorney was filed.

LEGAL STANDARD

Under section 877.6 of the Code of Civil Procedure, “[a] determination by the court that [a] settlement was made in good faith shall bar any other joint tortfeasor . . . from any further claims against the settling tortfeasor . . . for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault.” (Code Civ. Proc. § 877.6 (c).) Any party to an action may move for an order determining whether a settlement between the plaintiff and one or more alleged tortfeasors or co-obligors was made in good faith. (Code Civ. Proc., § 877.6, subd. (a)(1).) “The party asserting the lack of good faith shall have the burden of proof on that issue.” (Code Civ. Proc., § 877.6, subd. (d).)

In City of Grand View Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261, the court provided the following guidance regarding a motion for a good faith settlement determination: 

If the good faith settlement is contested, section 877.6, subdivision (d), sets forth a workable ground rule for the hearing by placing the burden of proving the lack of good faith on the contesting party. Once there is a showing made by the settlor of the settlement, the burden of proof on the issue of good faith shifts to the nonsettlor who asserts that the settlement was not made in good faith. If contested, declarations by the nonsettlor should be filed which in many cases could require the moving party to file responsive counterdeclarations to negate the lack of good faith asserted by the nonsettling contesting party. 

(192 Cal.App.3d 1251, 1260-1261 [citation omitted].) 

Section 877.6 requires “that the courts review [settlement] agreements made under its aegis to insure that the settlements appropriately balance the . . . statute’s dual objectives” (i.e., providing an “equitable sharing of costs among the parties at fault” and encouraging parties to resolve their disputes by way of settlement.) (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 494 (hereafter, Tech-Bilt).) In Tech-Bilt, the court set forth the factors to consider when determining whether a settlement is made in good faith. The Tech-Bilt factors are: (1) a rough approximation of plaintiff’s total recovery and the settlor’s proportionate liability; (2) the amount paid in settlement; (3) the allocation of settlement proceeds among plaintiffs; (4) a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial; (5) the financial conditions and insurance policy limits of settling defendants; and (6) the existence of collusion, fraud, or tortious conduct aimed to injure the interests of the non-settling defendants. (Tech-Bilt, supra, 38 Cal.3d at p. 498-501.) Not every factor will apply in every case. (Dole Food Co., Inc. v. Sup.Ct. (Shell Oil Co.) (2015) 242 Cal.4th 894, 909.)

“ ‘A determination as to the good faith of a settlement, within the meaning of section 877.6, necessarily requires the trial court to examine and weigh a number of relevant factors, [fn. omitted] one of the most important of which is the settling party's proportionate liability.’ [citation.] If ‘there is no substantial evidence to support a critical assumption as to the nature and extent of a settling defendant's liability, then a determination of good faith based upon such assumption is an abuse of discretion.’” (Mattco Forge, Inc. v. Arthur Young & Co. (1995) 38 Cal.App.4th 1337, 1350.)

However, the rule in Tech-Bilt that the settlement figure must not be grossly disproportionate to what a reasonable person at the time of settlement would estimate the settling defendant’s liability to be, has an exception. “[B]ad faith is not established merely by a showing that a settling defendant with limited ability to satisfy a judgment will pay less than his or her theoretical proportionate share: ‘Such a rule would unduly discourage settlements. “For the damages are often speculative, and the probability of legal liability therefor is often uncertain or remote. And even where the claimant's damages are obviously great, and the liability therefor certain, a disproportionately low settlement figure is often reasonable in the case of a relatively insolvent, and uninsured, or underinsured, joint tortfeasor.” [Citation.]’” (Schmid v. Superior Court (1988) 205 Cal.App.3d 1244, 1248 [quoting Tech-Bilt, supra, 38 Cal.3d at 499]; see also City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1264 [“The wealth or non-wealth of the settling defendant is a factor for the trial court to consider under Tech-Bilt.”].)

Schmid involved a car accident where the plaintiff alleged $500,000 in damages. (Schmid, supra, 205 Cal.App.3d at 1247.) The defendant driver, Schmid, offered her insurance policy limit of $55,000 as a settlement. Even though the trial court denied the motion for good faith because the settlement was disproportional to her liability, the Court of Appeal reversed because the settlement represented the policy limit, there was undisputed evidence that Schmid had no other assets, and the non-settling defendant had failed to oppose the motion. (Id. at 1248–49.)

“All affidavits relied upon as probative must state evidentiary facts; they must show facts and circumstances from which the ultimate fact sought to be proved may be deduced by the court. [citation.] Affidavits or declarations setting forth only conclusions, opinions or ultimate facts are to be held insufficient; even an expert's opinion cannot rise to the dignity of substantial evidence if it is unsubstantiated by facts. [citation.]” (Greshko v. County of Los Angeles (1987) 194 Cal.App.3d 822, 834.)

“The party asserting the lack of good faith . . . [is] permitted to demonstrate, if he can, that the settlement is so far ‘out of the ballpark’ in relation to [the above] factors as to be inconsistent with the equitable objectives of [Section 877.6]. Such a demonstration would establish that the proposed settlement was not a ‘settlement made in good faith’ within the terms of section 877.6.” (Tech-Bilt, supra, 38 Cal.3d at pp. 499–500.)

DISCUSSION

            Burley and Rangel (“Settling Parties”) have settled for $100,000. Defendants argue Settling Parties have provided no evidence of liability.

            According to Defendants, Rangel alleges that when Zhao collided with Burley, Rangel applied his breaks and came to a stop. Then, Hunsicker’s vehicle hit the rear of Rangel, causing the car to collide into Burley’s vehicle. However, they assert that Burley testified that he felt three impacts at the time of the accident, which suggests that Rangel hit Burley’s vehicle first, before the Hunsicker impact. (Motion, 10; Torres-Brito Decl. ¶ 15, Exh. A, Burley Depo. 24:16-17, 76:2-3.) Burley is claiming past and future medical specials. He underwent shoulder surgery, had epidural injections to his lower back, and may need lumbar spine surgery. Defendants assert Burley has not responded to written discovery.

Additionally, Defendants point out at the Application fails to show any evidence of Rangel’s financial condition. In short, Defendants argue that no evidence of the proportional liability of Rangel has been presented.

In opposition, Rangel contends the settlement represents his policy limits and under the reasoning in Schmid, should be determined to be in good faith. However, Rangel provides no declaration attesting that he has “modest assets.” (Opp., 10.) Furthermore, in reply, Defendants state that Rangel asserted a privacy objection for information regarding his asserts during his deposition. (Reply, Exh. A, Rangel Depo., 79:23-80:23.)

Based on the lack of evidence regarding a rough approximation of Plaintiff’s total recovery and Rangel’s proportionate liability, and the evidence that Burley contends he was hit by Rangel before Hunsicker collided into the vehicle, Defendants have shown that the Application fails to provide enough evidence that the settlement was entered in good faith. In addition, although Defendant asserts that the settlement amount is his insurance policy limit, he presents no evidence of his financial condition.

CONCLUSION AND ORDER

Therefore, the motion to Contest Application for Determination of Good Faith Settlement is GRANTED. Rangel’s Application for Determination of Good Faith Settlement is denied without prejudice.

Moving party shall give notice of the Court’s order and file a proof of service of such.