Superior Court of California 

County of Los Angeles – West District  

Beverly Hills Courthouse / Department 205 

 

 

BACKGROUND 

This is a construction defect case.  Plaintiff Tracie Calfee Dalton owns a home located at 1619 San Ysidro Drive, Beverly Hills, California (the “Property”).  She purchased the Property from Defendants Pamela Becker and Ocean Santa Barbara Investments, LLC (“Ocean SB”).  She alleges that when the Property was delivered to her, it was defective and unfit for its intended purposes.  She alleges numerous, extensive defects, including water intrusion and soil erosion issues, structural problems, plumbing and sewer defects, electrical system problems, and fire protection issues.   

The operative complaint alleges claims for (1) violation of building standards as set forth in Cal. Civ. Code §896, (2) breach of contract, (3) breach of express warranty, and (4) breach of the implied warranty of merchantability.  In addition to Becker and Ocean SB, Plaintiff sued (1) Pacific Coast Developers (“Pacific Coast”), who was hired by Ocean SB to manage the development; (2) D.BR Premium, Inc. (“Premium”) and United Excavation Group Inc. (“UEG”) who performed demolition and excavation work at the Property, and (3) Schick Geotechnical Inc. (“Schick”), who provided geologic and soils engineering testing at the Property (collectively “Settling Defendants”).   

This hearing is on Settling Defendants’ motions for determination of good faith settlement.  Pacific Coast agrees to pay $147,500, Premium $17,500, Schick $10,000, and UEG $10,000 in exchange for a dismissal with prejudice of Plaintiff’s complaint against Settling Defendants, and a mutual complete and total general release of all past, present and future claims including presently unknown claims pursuant to Civ. Code §1542.  These settlements are conditioned upon the Court’s finding of a good faith settlement.  No opposition was filed as of the posting of this tentative ruling.         

LEGAL STANDARD 

Under Code of Civil Procedure section 877.6, “[a]ny 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.”  (Code Civ. Proc. § 877.6(a)(1).)  “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, or the court may, in its discretion, receive other evidence at the hearing.” (Code Civ. Proc.§ 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.”  (Code Civ. Proc.§ 877.6(c).)  The party asserting the lack of good faith shall have the burden of proof on that issue.  (Code Civ. Proc.§ 877.6(d).)   

 

DISCUSSION 

Settling Defendants argue that their settlements are “within the ballpark” of their relative liability in this case, in accordance with Code Civ. Proc. §§ 877 and 877.6(a)(1), as well as the factors adopted by the California Supreme Court in Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal. 3d 488, 499-500 (“Tech-Bilt”).  

In Tech-Bilt, the California Supreme Court set forth the following factors for evaluating whether a proposed settlement was made in good faith: (1) a rough approximation of plaintiffs’ total recovery and the settler’s proportionate liability; (2) the amount paid in settlement; (3) the allocation of settlement proceeds among plaintiffs; (4) discount for settlement before 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 non-settling defendants.  (Id. at p. 499.)  The Court also stated that “practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement. . . . The party asserting the lack of good faith, who has the burden of proof on that issue (§ 877.6, subd. (d)), should be permitted to demonstrate, if he 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. at 499–500.) 

Rough Approximation/Settlement Amount 

The first Tech-Bilt factor consists of two parts – a rough approximation of Plaintiff’s total recovery and the settlor’s proportionate liability.¿ 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 (hereafter, North County).)¿¿¿ 

Additionally, “a court not only looks at the alleged tortfeasor’s liability to the plaintiff, but it must also consider the culpability of the tortfeasor vis-à-vis other parties alleged to be responsible for the same injury.¿ Potential liability for indemnity to a nonsettling defendant is an important consideration for the trial court in determining whether to approve a settlement by an alleged tortfeasor.¿ [Citation.]”¿ (TSI Seismic Tenant Space, Inc. v. Superior Court (2007) 149 Cal.App.4th 159, 166.)¿ 

‘“[A] defendant’s settlement figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate the defendant’s liability to be.’¿ [Citation.]”¿ (Tech-Bilt, 38 Cal.3d at p. 499.)¿ However, even though “an offer of settlement must bear some relationship to one’s proportionate liability, bad faith is not ‘established by a showing that a settling defendant paid less than his theoretical proportionate or fair share.’¿ [Citation.]”¿ (North County, supra, 27 Cal.App.4th at p.1090.)¿ “Such a rule would unduly discourage settlements” and “convert the pretrial settlement approval procedure into a full-scale mini-trial.”¿ (Tech-Bilt, supra, 38 Cal.3d at p. 499.)¿ Rather, in order to meet the proportionality requirement, “all that is necessary is that there be a ‘rough approximation’ between a settling tortfeasor’s offer of settlement and his proportionate liability.  [Citation.]” (North County, supra, 27 Cal.App.4th at pp. 1090–1091.)¿  

The second Tech-Bilt factor – amount of settlement – is closely related to the first factor and addresses whether the settlement amount is within the ballpark of settling defendant’s share of liability.  In determining whether the settling defendant’s settlement figure is “within the ballpark”, the Court may rely on “the judge’s personal experience” and the experience of “experts in the field.”¿ (Tech-Bilt, supra, 38 Cal.3d at p. 500.)¿      

Here, Settling Defendants argue that their settlements are “within the ballpark” of their relative liability because during the course of discovery, Plaintiff failed to provide any proof of their liability for the alleged defects and of Plaintiff’s “speculative” damages.  Additionally, Schick argues any damages against it are capped at $5,700 given a limitation of liability provision in its agreement with Becker, which it claims would be enforceable against Plaintiff.  On these facts, the Court concludes the first and second Tech-Bilt factors weigh in favor of a determination that the settlements are in good faith. 

Allocation of Settlement Proceeds Among Plaintiffs 

Because Tracee Dalton is the only plaintiff in this action, this factor does not apply. 

Financial Condition and Insurance Policy Limits 

Settling Defendants’ financial condition and insurance policy limits did not play a role in the settlements.  Accordingly, this factor does not weigh in favor of or against a determination that the settlements are in good faith. 

Discount for Settlement Before Trial 

Settling Defendants argue they are actually paying more than they would if the case were to go to trial, given the state of the evidence, but they made a cost-benefit economic decision to resolve the matter now to buy peace for a sum certain and to avoid the risks and costs of further litigation.  Accordingly, this factor weighs in favor of a determination that the settlement is in good faith.   

Evidence of Collusion, Fraud, or Tortious Conduct 

Settling Defendants argue the settlement was the product of extensive arms-length negotiations with the help of mediator Glenn Barger, and was not the product of fraud or collusion.  The mediation took place over three sessions on October 14, 2021, June 17, 2022 and July 10, 2023.  Accordingly, the Court determines this factor weighs in favor of a determination that the settlements are in good faith.   

CONCLUSION 

Based on the foregoing, the Court GRANTS Settling Defendants’ motions for determination of good faith settlement.   

 

IT IS SO ORDERED. 

 

DATED: October 24, 2023  ___________________________ 

Edward B. Moreton, Jr. 

Judge of the Superior Court