Judge: Daniel M. Crowley, Case: 20STCV26242, Date: 2022-12-09 Tentative Ruling

Case Number: 20STCV26242    Hearing Date: December 9, 2022    Dept: 28

Defendant T.J. Janca Construction, Inc.’s Motion for Determination of Good Faith Settlement

Having considered the moving papers, the Court rules as follows. 

BACKGROUND

On July 13, 2020, Plaintiff Cathy Contreras (“Contreras”) and Aniya Correra (“Correra” or “Plaintiff”) filed this action against Defendants Corvallis Middle School (“Corvallis”), Norwalk-La Miranda Unified School District (“NMUSD”) and Greenfields Outdoor Fitness, Inc. (“GOF”) for general negligence, products liability and premises liability.

On October 27, 2020, GOF filed an answer. On December 4, 2020, the Court dismissed Corvallis, with prejudice, pursuant to Plaintiff’s request.

On December 18, 2020, Plaintiffs filed the FAC. Plaintiff later amended the FAC to include Defendant Environmental Constructions, Inc. (“EC”).

On January 12, 2021, NMUSD filed an answer and a Cross-Complaint against Cross-Defendant GOF and EC for express indemnity and declaratory relief. On February 17, 2021, GOF filed an answer. On June 23, 2021, EC filed an answer.

On March 25, 2021, Plaintiffs filed the SAC.

On May 28, 2021, Plaintiffs filed the TAC. Plaintiff later amended the complaint to include Defendant T.J. Janca Construction, Inc. (“T.J.”).

On June 29, 2021, GOF filed an answer and a Cross-Complaint against Cross-Defendants NMUSD and EC for equitable indemnity, contribution and declaratory relief. GOF later amended the CC to include Cross-Defendant T.J. On August 2, 2021, EC filed an answer. On September 22, 2021, NMUSD filed an answer.

On July 2, 2021, NMUSD filed an answer.

On July 13, 2021, EC filed an answer and a Cross-Complaint against Cross-Defendants GOF, NMUSD and T.J. for indemnification, equitable contribution, apportionment of fault and declaratory relief. On August 6, 2021, GOF filed an answer. T.J. filed an answer on December 23, 2021.

On December 23, 2021, T.J. filed a Cross-Complaint against Cross-Defendants EC, GOF and NMUSD for equitable indemnity, contribution, apportionment of fault and declaratory relief. On January 11, 2022, GOF filed an answer. On January 24, 2022, EC filed an answer. On January 26, 202, NMUSD filed an answer.

On January 26, 2022, NMUSD filed a Cross-Complaint against Cross-Defendant T.J. for equitable indemnity, contribution and declaratory relief.  On February 28, 2022, T.J. filed an answer.

On November 16, 2022, T.J. filed a Motion for Good Faith Settlement to be heard on December 9, 2022.

Trial is currently set for March 13, 2023.

PARTY’S REQUESTS

T.J.  requests the Court find its settlement with Plaintiff is in good faith.

LEGAL STANDARD

CCP § 887.6(a)(2) states that “[i]n the alternative, a settling party may give notice of settlement to all parties and to the court, together with an application for determination of good faith settlement and a proposed order. The application shall indicate the settling parties, and the basis, terms, and amount of the settlement. The notice, application, and proposed order shall be given by certified mail, return receipt requested, or by personal service. Proof of service shall be filed with the court. Within 25 days of the mailing of the notice, application, and proposed order, or within 20 days of personal service, a nonsettling party may file a notice of motion to contest the good faith of the settlement. If none of the nonsettling parties files a motion within 25 days of mailing of the notice, application, and proposed order, or within 20 days of personal service, the court may approve the settlement. The notice by a nonsettling party shall be given in the manner provided in subdivision (b) of Section 1005. However, this paragraph shall not apply to settlements in which a confidentiality agreement has been entered into regarding the case or the terms of the settlement.” The statute further clarifies that the party asserting the lack of good faith shall have the burden of proof on that issue.

CCP § 877 states “[w]here a release, dismissal with or without prejudice, or a covenant not to sue or not to enforce judgment is given in good faith before verdict or judgment to one or more of a number of tortfeasors claimed to be liable for the same tort, or to one or more other co-obligors mutually subject to contribution rights, it shall have the following effect: (a) It shall not discharge any other such party from liability unless its terms so provide, but it shall reduce the claims against the others in the amount stipulated by the release, the dismissal or the covenant, or in the amount of the consideration paid for it, whichever is the greater. (b) It shall discharge the party to whom it is given from all liability for any contribution to any other parties.”

In Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499, the California Supreme Court identified the following nonexclusive factors courts are to consider in determining if a settlement is in good faith under section 877.6: “a rough approximation of plaintiffs' total recovery and the settlor's proportionate liability, the amount paid in settlement, the allocation of settlement proceeds among plaintiffs, and a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial.  Other relevant considerations include the financial conditions and insurance policy limits of settling defendants, as well as the existence of collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.”

DISCUSSION

Plaintiffs allege that Plaintiff placed her right hand on a two-person ski machine, while it was in use by classmates. As her classmates got off the machine, Plaintiff’s right finger was crushed by the machine. T.J. did not design, manufacture, assemble or maintain the subject ski machine. T.J. installed the subject equipment, which was deemed “completed and accepted” by a Greenfield representative over a year prior to the incident.

Recovery and Proportionate Liability 

T.J. states that Plaintiff’s form interrogatories identify approximately $120,000.00 in medical treatment costs; T.J. approximates that a jury could award Plaintiff $750,000.00 to $1,000,000.00 against liable parties.

T.J. asserts that it has 0% liability, as its involvement is limited to installing the equipment a year and half prior to the incident. NMUSD completed and accepted the work. It did not manufacture, design, or pick out the subject equipment. Any liability would be relatively limited under this set of facts. T.J.’s settlement for $10,000.00, approximately 8.75% of the identified medical costs, seems more than reasonable given T.J.’s potential liability.

Allocation of Settlement 

All of the settlement will be delivered to the Plaintiff minor, who was injured in this action. This is the proper allocation, as the other Plaintiff is serving as Plaintiff's Guardian ad Litem.

Financial considerations  

T.J. has a commercial general liability policy of $1,000,000.00 per occurrence. T.J. did not provide any information as to asset discovery. The amount provided is within T.J.’s financial means.

Collusion or Fraud 

There is no indication of fraud or collusion. This was an arms-length settlement conducted after extensively engaging in discovery with all parties. This factor leaves in favor of granting the motion.

Conclusion 

The Court finds that T.J. has satisfied the Tech-Bilt factors. T.J. provided sufficient information as to all factors and generally factors support finding the settlement to be made in good faith. The Court grants the motion.

CONCLUSION

Defendant T.J. Janca Construction, Inc.’s Motion for Determination of Good Faith Settlement is GRANTED.  All pending and future claims against T.J., based in equitable indemnity, including Cross-Complaints are hereby dismissed.

            Moving party is ordered to give notice of this ruling.

Moving Party is ordered to file the proof of service of this ruling with the Court within five days.

The parties are directed to the header of this tentative ruling for further instructions.