Judge: Donald F. Gaffney, Case: Mostafa v. Hileman, Date: 2023-05-17 Tentative Ruling

TENTATIVE RULING:

Defendant Hileman seeks court determination of good faith settlement between Plaintiff Mohammad Golam Mostafa and Defendant Louie W. Hileman.  Plaintiff has agreed to settle his claims against Defendant Hileman in exchange for his applicable insurance policy limits of $50,000, with each party to bear their own attorneys’ fees and costs.  Defendant Swift contests the application for good faith settlement.  For the reasons set forth below, Defendant Hileman’s Application for an Order of Good Faith Settlement is GRANTED.

This case arises out of a three-vehicle automobile accident that occurred on August 31, 2019, at or near the intersection of Jamboree Road and Back Bay Drive, in the city of Newport Beach, California. Plaintiff alleges injuries and damages as a result of the subject accident.  According to Defendant Hileman, he was traveling southbound on Jamboree Road. When Defendant Hileman was halfway through the intersection, Plaintiff’s vehicle collided into the driver’s side

of his vehicle. Defendant Swift’s vehicle rear-ended Plaintiff’s vehicle.

On August 30, 2021, Plaintiff filed his form complaint against defendants.  (ROA 2). Defendant Swift has also filed a cross-complaint against Defendant Hileman for indemnification, apportionment of fault, declaratory relief and motor vehicle negligence. (ROA 23).

California Civil Procedure Code § 877.6 (a)(1) provides that any party to an action in which it is alleged that two or more parties are joint tortfeasors or co-obligors on a contract debt shall be entitled to a hearing on the issue of the good faith of a settlement entered into by the plaintiff or other claimant and one or more alleged tortfeasors or co-obligors, upon giving notice in the manner provided in subdivision (b) of Section 1005. Upon a showing of good cause, the court may shorten the time for giving the required notice to permit the determination of the issue to be made before the commencement of the trial of the action, or before the verdict or judgment if settlement is made after the trial has commenced.

California Civil Procedure Code § 877.6(a)(2) states 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. A nonsettling party may file a notice of motion to contest the good faith of the settlement. (Id.) The issue of the good faith of a settlement may be determined by the court on the basis of affidavits served with the notice of hearing and any counter affidavits filed in response.( Id.; § 877.6(b).) A determination by the court that the settlement was made in good faith shall bar any other joint tortfeasor or co-obligor from any further claims against the settling tortfeasor or co-obligor for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault. (Id.; § 877.6(c).) The party asserting a lack of good faith has the burden of proof on that issue. (Id.; § 877.6 (d).)

The purpose of the court’s review of a settlement for good faith is to determine whether the settlement prejudices the interests of nonsettling tortfeasors. Tech-Bilt, Inc. v. Woodward-Clyde & Assocs. (1985) 38 Cal.3d 488, 494 n.4. The court considers a number of factors in evaluating a settlement for good faith: a “rough approximation” of the plaintiffs’ total recovery and the settlor’s proportionate liability; the amount paid in settlement; the allocation of the settlement proceeds among plaintiffs; and a recognition that a settlor should pay less in settlement than the settlor would pay if found liable after a trial. (Id. at 499.) Other relevant considerations include the financial conditions and insurance policy limits of the settling defendants, as well as the existence of collusion, fraud or tortious conduct aimed to injure the interests of nonsettling defendants. (Id.) Practical considerations require that the evaluation be made on the basis of information available at the time of the settlement. (Id.) The party asserting a lack of good faith should be permitted to demonstrate, if it can, that the settlement is so far “out of the ballpark” in relation to these factors as to be inconsistent with the equitable objectives of the statute. (Id.)

Evaluation of the Tech-Bilt factors and the evidence presented demonstrates that the settlement was made in good faith. Tech-Bilt instructs that a court evaluating a settlement for good faith should recognize that a settling party should pay less in settlement than it would pay if found liable at trial. There is no evidence of collusion, fraud or tortious conduct aimed to injure the interests of nonsettling defendants.  Defendant Hileman has agreed to pay his available insurance policy limits to Plaintiff to settle his claims which is slightly less than Plaintiff’s claimed medical specials, to date. 

Defendant Swift, as the party opposing the application/motion, bears the burden of proving a lack of good faith. He has not carried that burden and has not demonstrated that the settlement is so far “out of the ballpark” in relation to the Tech-Bilt factors as to be inconsistent with the equitable objectives of section 877.6.

Accordingly, the Court finds the settlement between Plaintiff Mostafa and Defendant Hileman was made in good faith.

Defendant Hileman to give notice.