Judge: David B. Gelfound, Case: 23CHCV02339, Date: 2024-06-07 Tentative Ruling

Counsel wishing to submit on a tentative ruling may inform the clerk or courtroom assistant in North Valley Department F49, 9425 Penfield Ave., Chatsworth, CA 91311, at (818) 407-2249.  Please be aware that unless all parties submit, the matter will still be called for hearing and may be argued by any appearing/non-submitting parties. If the matter is submitted on the court's tentative ruling by all parties, counsel for moving party shall give notice of ruling. This may be done by incorporating verbatim the court's tentative ruling. The tentative ruling may be extracted verbatim by copying and pasting, as unformatted text, from the Los Angeles Superior Court’s website, http://www.lasuperiorcourt.org.
All hearings on law and motion and other calendar matters are generally NOT transcribed by a court reporter unless one is provided by the party(ies). 

Case Number: 23CHCV02339    Hearing Date: June 7, 2024    Dept: F49

LOS ANGELES SUPERIOR COURT

NORTH VALLEY DISTRICT

DEPARTMENT F-49

APPLICATION DETERMINATION OF GOOD FAITH SETTLEMENT (C.C.P. Section 877.6(a)(2)); MOTION TO CONTEST

Motion filed: 2/13/23

MOVING PARTY: Cross-Defendant Hoa T. Duong (“Duong” or “Cross-Defendant”)

RESPONDING PARTY: Defendant Scott Andrew Peterson (“Peterson” or “Defendant”)

NOTICE: OK.¿¿¿ 

RELIEF REQUESTED: Cross-Defendant’s application requires an order determining that the settlement entered into between Plaintiff, Timothy James Dolan, and Duong in the underlying Case No. 23CHCV00241 was made in good faith under Code of Civil Procedure section 877.6, subdivision (a)(2). Defendant’s Motion seeks to contest the good faith settlement.

TENTATIVE RULING: The application is DENIED. The motion to contest is GRANTED.

BACKGROUND

This action arises from an alleged three-party motor vehicle accident that occurred on December 6, 2022, on the Northbound I-5 Freeway North of Hasley Canyon Road, in an unincorporated area in the City of Castaic, County of Los Angeles (the “Accident”).

Before the filing of this action, Plaintiff sued Cross-Defendant, Duong, in the underlying Case of Timothy James Dolan v. Hoa T. Duong, Case No. 23CHCV00241, alleging personal injuries arising from the Accident, during which Plaintiff and Duong reached a settlement. (Siepler Decl., ¶¶ 3-4.) Subsequently, a dismissal of Case No. 23CHCV00241 was filed on August 1, 2023.

On August 4, 2023, Plaintiff filed his Complaint against Defendant, Peterson for general negligence, alleging personal injuries arising from the same Accident. Subsequently, Peterson filed his Answer to the Complaint on November 9, 2023.

            On the same day, November 9, 2023, Peterson filed a Cross-Complaint against Duong and Andrew Duong (“Andrew”), alleging three causes of action: (1) indemnification, (2) apportionment of fault, and (3) declaratory relief. Subsequently, on January 18, 2024, Duong and Andrew filed their respective Answers to the Cross-Complaint on January 18, and February 13, 2024, respectively.

            On February 13, 2024, Duong filed the instant Application for Determination of Good Faith Settlement (the “Application”).

Subsequently, on March 7, 2024, Peterson filed a notice of motion to contest the good faith settlement.

ANALYSIS

Code of Civil Procedure section 877.6, subdivision (a)(2) provides, in pertinent part, that “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.”

The determination as to whether a settlement is in good faith is a matter left to the discretion of the trial court.” (Mattco Forge, Inc. v. Arthur Young & Co. (1995) 38 Cal.App.4th 1337, 1349 (Mattco).)

A.    Motion to Contest is Timely

The Court determines that Peterson’s Motion to Contest the Good Faith of the Settlement, filed on March 7, 2024 (the “Motion”) is timely, as it was filed within 25 days of the mailing of Cross-Defendant’s Application, within the statutory time period under Code of Civil Procedure section 877.6, subdivision (a)(2).

B.     Determination of Good Faith Settlement

1.      Applicability of Code of Civil Procedure Section 877.6

Here, Peterson contends that despite being sued by Plaintiff, he is not a joint tortfeasor with Duong who should be liable for 100 percent of the damage. Peterson argues that this settlement does not fall within Code of Civil Procedure section 877.6 which applies to an action in which it is alleged to have two or more joint tortfeasors or co-obligors. (Mot., at p. 3.) The Court disagrees.

The Court first notes that Peterson’s argument solely relies on a legal conclusion that he bears no liability and disregards the terms of the code itself, which states that it applies when “... it is alleged that two or more parties are joint tortfeasors.” (See Code of Civ. Proc., § 877.6, subd. (a).) (Underlines added.) The Court of Appeal in Wilshire Ins. Co. v. Tuff Boy Holding, Inc. (2001) 86 Cal.App.4th 627 (Wilshire), clarified that “[t]his language... reflects that there must be some party in the case who is not a party to the settlement for which trial court confirmation is being sought” even if the tortfeasors were names defendants in different proceedings at different times. (Id., at p. 640.) In Wilshire, plaintiffs were heirs of automobile accident victims. They sued and reached a settlement with the insurer of the other driver, Wilshire Insurance Company. Later, the plaintiff in that case amended their complaint adding the manufacturer of the trailer, Tuff Boy Holding, Inc. as a defendant, under the theories of negligence and product liability. The Wilshire Court found, “Here, there were two parties who were alleged to be joint tortfeasors – Campbel [the plaintiff] (in which shoes Wilshire stands) and Tuff Boy. Campbell (Wilshire) was not a party to the settlement between the Cline plaintiffs and Tuff boy.... When we independently examine section 877.6 and its goals, we conclude the trial court correctly applied the statute[.]” (Ibid.)

Here, like the situation in Wilshire, Plaintiff alleges that Duong and Peterson both were tortfeasors to his damages, although the allegations arise from two separate proceedings. It is evident that Peterson is an “alleged” joint tortfeasor under the meaning of Code of Civil Procedure section 877.6, and the ultimate deposition of each’s respective liability, even if none, has no bearing on the issue of application of the section 877.6 before us.

Consequently, the Court concludes that Plaintiff properly submitted his Application under Code of Civil Procedure section 877.6.

2.      Tech-Bilt Factors

Peterson further argues that based upon analysis of the factors set forth in Tech-Bilt, Inc. v. Woodward-Clyde & Associates¿(1985) 38 Cal.3d 488 (Tech-Bilt), the Court should also deny the Application. (Mot., at pp. 4-7.) The Court next turns to examining these factors.

The California Supreme Court held in Tech-Bilt that the trial court’s determination of good faith is based on “a number of factors,” including “[1] a rough approximation of plaintiffs’ 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, as well as [6] the existence of collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.” ¿(Tech-Bilt, supra, at p. 499; see also Far West Financial Corp. v. D&S Co.¿(1988) 46 Cal.3d 796, 816, fn. 16 [expanding on Tech-Bilt factors].) “[W]hen the good faith nature of a settlement is disputed, it is incumbent upon the trial court to consider and weigh the Tech-Bilt factors.” (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261 (City of Grand Terrace).

i.                    Rough Proximation and Settling Defendant’s Proportionate Liability

 The first Tech–Bilt factor, which consists of two parts: a rough approximation of the plaintiff’s total recovery and the settling defendant’s proportionate liability. (Cahill v. San Diego Gas & Electric Co. (App. 4 Dist. 2011) 194 Cal.App.4th 939, 962 (Cahill).)

When approximating a plaintiff’s total recovery or the settling defendant’s proportionate liability, “judges should . . . not yearn for the unreal goal of mathematical certainty.¿ Because the application of section 877.6 requires an educated guess as to what may occur should the case go to trial, all that can be expected is an estimate, not a definitive conclusion.”¿ (North County Contractor’s Assn. v. Touchstone Ins. Services (1994) 27 Cal.App.4th 1085, 1090.)

Furthermore, the defendant's settlement figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate the settling defendant's liability to be. (Dole Food Co., Inc. v. Superior Court (2015) 242 Cal.App.4th 894, 909.)  After the court first makes a rough approximation of the total amount the plaintiff is likely to recover, the court then determines what, if any, the settling defendant’s proportionate share of that total recovery would be, and then determines whether the settlement amount was “within the ballpark” of reasonable settlement amounts based on the first two factors.” (Ibid.)

Here, Plaintiff does not claim a specific damage amount in the Complaint. To aid the Court in estimating the Plaintiff’s potential total recovery, Peterson presents evidence that Plaintiff, Mr. Dolan, has identified his alleged injuries, in response to Peterson’s Form Interrogatories, Set One, inquiring about the same, to include, “Broken sternum, broken neck, spine, lower back pain and problems with left hand in strength, numbness, and weakness. Generalized anxiety is characterized by pain, fear, mental suffering, loss of enjoyment of life, and generalized emotional distress.” (Mot., at p. 4)

Moreover, Dolan identified medical services and charges to date as: “American Medical Response, $2,833.00; Henry Mayo Newhall Memorial Hospital, $63,459.97; Nicolas Jain, MD/Center for Pain Control, $1,750.00; Kern Radiology Medical Group, Inc., $1,278.00.” (Mot., at p. 4.)

Furthermore, Dolan stated in his response that future and additional treatment are required, including “(a) Dr. Russ Shimizu, MD, 2811 Wilshire Blvd. #550, Santa Monica, CA 90403 (310) 829-5968; (b) Neck Surgery; and (c) Cost unknown; and (a) Dr. Nicolas Jain, MD, Center for Pain Control, 2701 Chester Avenue, Suite 102, Bakersfield, CA 93301 (818) 923-5440, (b) Neck Surgery; and (c) Cost Unknown.” (Mot., at p. 5.)

Peterson argues that although an accurate estimate of damage is unavailable at the moment, the settlement amount of $50,000 pales in comparison with the potential judgment for the injuries of Plaintiff.

The Court notes that the approximation needs to be made as to at the time of the settlement. It acknowledges that these pieces of information were acquired in Plaintiff’s response to Peterson’s Form Interrogatories, Set One, as of January 23, 2024 (Mot., at p. 4), whereas the settlement in the underlying case was reached and a release of all claims was executed by Plaintiff on June 26, 2023. (Siepler Decl., ¶ 5.) Considering the proximity of the timeframe and the absence of any evidence from applicant Duong regarding records in the underlying case, the Court cannot reasonably infer that Plaintiff held a significantly different perspective on potential damage at the time of the settlement. Based on the available information and its own judicial experience, the Court determines that the settlement of $50,000 appears to be insubstantial in relation to the total recovery.

Moreover, Peterson argues that Duong’s settlement amount is grossly disproportionate to what a reasonable person would estimate her liability to be. He claims that Duong is 100 percent liable for Plaintiff’s injuries based on the information reported on the Traffic Crash Report # 9540-2022-02652 by California Highway Patrol officer B.E. Kellog #022378 (“Officer Kellog”). In essence, Officer Kellog reported his on-scene investigation as follows:

1.      Cross-Defendant Duong was driving a 2020 Volkswagen Jetta (the “Jetta”) in the #1 of four lanes when she felt a bump. So she turned on her hazard lights and stopped in the #1 lane. She placed the vehicle in park and exited to investigate what had happened. While standing outside her vehicle, she observed that she had a flat tire, and that traffic was going fast around her. As she observed multiple vehicles nearly colliding with her vehicle, and then observed that Plaintiff’s vehicle and Defendant Peterson’s vehicle collided with her Jetta. Duong’s Jetta had a flat tire which was unrelated to the crash, and the vehicle could have easily been driven from the roadway.

2.      Defendant Peterson was driving a 2005 Ford F150 (“F-150”) in the #1 lane when he observed the vehicle in front of him swerving into the #2 lane and then observed the vehicle of Duong stopped in the #1 lane. He applied his brakes and came to a complete stop a few feet from the Duong’s Jetta. He then felt an impact to the rear of his vehicle which caused it to be pushed forward and collide with the rear of the Duong’s Jetta. Peterson's F-150 sustained moderate damage as a result of this crash.

3.      Plaintiff Dolan was driving a 2017 Lincoln MKZ (the “MKZ”) when he observed vehicles in front of him swerving into the #2 lane. When he then observed Peterson’s F-150 stopped in the #1 lane, he applied his brakes but was unable to stop before experiencing an impact to the front of his MKZ. Dolan’s MKZ sustained major damage as a result of this crash.

(Hagemann Decl., ¶ Ex. “A.”)

¿           Based on the only factual information available before the Court and its own judicial experience, the Court rationally concludes that a reasonable person could find that as compared to Peterson’s liability, Duong’s negligence was likely the primary, if not sole, cause of Dolan’s injuries, thereby reducing, if not eliminating, the potential judgment against Peterson.

            Accordingly, based on the records before it, the Court does not find that the analysis of the first Tech-Bilt factor can be said to be in favor of the determination of good faith settlement.

            Furthermore, case law has established that “[p]otential liability for indemnity to a nonsettling defendant is an important consideration” for the trial court in determining good faith settlement under Code of Civil Procedure section 877.6. (West v. Superior Court (1994) 27 Cal.App.4th 1625, 1636-1637 (West).) In West, the home buyer plaintiff there brought an action against the seller and their real estate broker, alleging that they failed to disclose subsidence problems. The West court reversed the trial court’s grant of broker’s motion under section 877.6, seeking determination of its settlement with home buyer was made in good faith, thereby barring the cross-complaint of the sellers against the broker for comparative indemnity and implied indemnity. The West Court held that the trial should consider the culpability of the broker and their potential liability for indemnity to the sellers and stated that shielding the brokers with immunity from the cross-complaints of the sellers “neither serves the goal of encouraging settlement among all interested parties nor promotes the goal of equitable allocation among multiple tortfeasors.” (West, supra, 27 Cal. App. 4th at p. 1636.)

            Mirroring the situation in West, here, Duong seeks determination of good faith settlement in order to bar the cross-complaint of Peterson. The Court finds that in addition to her proportionate share of what the total damage may be, Duong’s potential liability for indemnity also strongly weighs against the determination of good faith settlement.

            Therefore, the first Tech-Bilt fact does not support the determination of good faith settlement.

ii.                  Settling Defendant’s Financial Condition

In regard to the factorial approach of Tech-Bilt, the only factors stated to assess the settling defendant’s financial condition were the amount of the settlement and the policy limits. However, the Court of Appeal in City of Grand Terrace, supra, held that “it was an abuse of discretion for the trial court to find a good faith settlement in that there was insufficient evidence presented on the issues of settlor's financial condition and insurance coverage.” (City of Grand Terrace, supra, 192 Cal.App.3d, at p. 1264.)

Here, Peterson asserts that there was insufficient evidence presented by Duong as to her financial condition and the availability of any additional insurance policy held by the registered owner of the vehicle that was involved in the accident, her son Andrew Duong, both of which could have been added to the pot, if available, to make up her proportionate share in the settlement. (Mot., at p. 7.) As to this contention, the Court agrees.

Accordingly, the Court determines that the analysis of this factor is also against the determination of the good faith settlement.

iii.                The Existence of Collusion, Fraud, or Tortious Conduct Aimed to Injure the Interests of Nonsettling Defendants

The “existence of collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants” is another relevant consideration. (Tech-Bilt, supra, 38 Cal.3d at 499.)

Peterson argues that if a party enters into a disproportionately low settlement with the plaintiff solely to obtain immunity, the inference that the settlement was not made in good faith is difficult to avoid, citing Mattco, supra.

            Notably, the Court distinguished this factor from the first Tech-Bilt factor which focuses on the approximation and proportionality, treating them independently. Peterson’s contention seems to imply that failure to satisfy the first factor of Tech-Bilt necessarily leads to the conclusion that it must fail another factor for nonexistence of collusion, fraud, or tortious conduct aimed to injure the interests of the nonsettling party.

            Here, there is no evidence of “the existence of collusion, fraud, or tortious conduct aimed to injure the interests of” Peterson. Therefore, the Court finds Peterson’s contention on this ground is unconvincing.

            Based on the foregoing, the Court concludes that its analysis of Tech-Bilt factors does not support the determination of good faith settlement that would have provided Cross-Defendant Duong immunity from liability to nonsettling Defendant Peterson.

            Therefore, the Court DENIES the Application for Determination of Good Faith Settlement.

CONCLUSION

Cross-Defendant’s Application for Determination of Good Faith Settlement is DENIED.

Defendant’s Motion to Contest is GRANTED.

Moving Defendant is ordered to give notice.