Judge: Gary I. Micon, Case: 23CHCV01498, Date: 2024-11-25 Tentative Ruling

Case Number: 23CHCV01498    Hearing Date: November 25, 2024    Dept: F43

Dept. F43

Date: 11-25-24

Case # 23CHCV01498, Palomeque, et al. v. Cass Enterprises, Inc., et al.

Trial Date: 2-24-25

MOTION FOR DETERMINATION OF GOOD FAITH SETTLEMENT

MOVING PARTY: Defendants Cass Enterprises, Inc., Cruisers Car Wash, Dajat Zarookian, Cirano Mercado, Casro, Golnaraghi Enterprises, LP, Jospeh Assad, and Herman Gouzy

RESPONDING PARTY: N/A

RELIEF REQUESTED

Order stating:

·         Settlement was reached in good faith.

·         Settlement bars all present and future claims against Defendants.

RULING: Motion is denied without prejudice.

SUMMARY OF ACTION

On April 22, 2023, Cirano Mercado crashed Joseph Assad’s jeep into Herman Gouzy’s Honda which then crashed into the passenger side of Alfredo Palomeque and Maria Palomeque’s (the Palomeques) car.  The Palomeques’ car then collided with Jessica Franco Tashjian’s Toyota Camry, in which Ms. Tashjian and her daughter Elane Mariy Franco were sitting.  At the time, Mercado was acting within the scope of his employment for Cass Enterprises, Inc., Cruisers Car Wash, Dajat Zarookian, Casro, and Golnaraghi Enterprises, LP.  The Palomeques filed this action against Cass Enterprises, Inc., Cruisers Car Wash, Dajat Zarookian, Cirano Mercado, Casro, Golnaraghi Enterprises, LP, Joseph Assad, and Herman Gouzy (Defendants) on May 23, 2023, alleging causes of action for negligence and negligent hiring.

On July 11, 2023, Herman Gouzy filed an answer.  On July 31, 2023, Cass Enterprises filed an answer. On August 11, 2023, Cruisers Car Wash, Dajat Zarookian, Casro, and Golnaraghi Enterprises, LP filed an answer. On August 14, 2023, Mercado filed an answer.

On October 11, 2023, Herman Gouzy was dismissed with prejudice.

On January 26, 2024, Joseph Assad was dismissed with prejudice.

On January 29, 2024, the Court held a case management conference ordering the parties to participate in a Mandatory Settlement conference conducted by the Resolve Law LA Virtual MSC Program no later than December 17, 2024.

On September 13, 2024, Cass, Cruisers, and Zarookian filed this motion for determination of good faith settlement under section 877.6.  No other parties contest the settlement.

ANALYSIS

In any action in which two or more defendants are joint tortfeasors, a “good faith” settlement by one of these defendants with the plaintiff bars the other defendants from seeking contribution from the settling defendant.  (Code Civ. Proc., § 877.)  The settlement shall also “reduce the claims against the others” by the amount stipulated in the settlement.  (Code Civ. Proc., § 877, subd. (a).) 

The court relies on four factors to determine whether a settlement is in “good faith”: (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; and (4) 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 non-settling defendants.  (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.)  Finally, the court must evaluate the settlement based on the information available at the time of settlement.  (Ibid.) 

Once the Court determines the settlement was made in good faith, the other joint tortfeasors are barred from pursuing further claims against the settling tortfeasors for contribution.  (Code Civ. Proc., § 877.6, subd. (c).)  The policies behind Sections 877 and 877.6 are, “(1) The equitable sharing of costs among the parties at fault and (2) the encouragement of settlements.”  (Erreca’s v. Superior Court (1993) 19 Cal.App.4th 1475, 1487.)  The trial court is given wide discretion to determine whether the settlement was in “good faith,” and its decision is reviewed for the existence of “substantial evidence.”  (Hellam v. Crane Co. (2015) 239 Cal.App.4th 851, 860.)  

“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.”  (Code Civ. Proc., § 877.6, subd. (a)(2).)  The settling party must also attach supporting affidavits.  (Code Civ. Proc., § 877.6, subd. (b).)

Unopposed motions do not require a full and complete discussion of the Tech-Bilt factors.  (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261 [“[W]hen no one objects, the barebones motion which sets forth the ground of good faith, accompanied by a declaration which sets forth a brief background of the case is sufficient.”)

The Wagner Declaration

Defendants present the declaration of their counsel record, Luke Wagner. (Declaration of Luke Wagner.) The Wagner declaration does not comply with section 877.6.

On March 8, 2024 and May 24, 2024, counsel for the Palomeques, Ms. Tashjian, and Ms. Tashjian’s daughter sent Defendants’ counsel a policy limit demand letter seeking all available remaining policy limits to settle their personal injury claims.[1]  (Declaration of Luke Wagner, ¶ 5.)  After receiving the demand and evaluating the available evidence, the parties agreed to settle all known personal injury claims in exchange for Defendants’ insurers’ agreement to pay all available remaining policy limits.  (Id. at ¶ 7.)

The specific terms of settlement agreement are as follows: Defendants’ insurer will pay a total of $941,162.98—$541,162.98 to Maria Palomeque; $200,000 to Alfredo Palomeque; $185,000 to Jessica Tashjian; and $15,000 to Jessica Franco Tashjian, Guardian ad Litem for Elane Mariy Franco.  (Wagner Dec., ¶¶ 8, 9.)  This releases all claims against Defendants including Palomeque’s complaint, fees and costs and a waiver of Civil Code section 1542.  (Ibid.)  This also dismisses claims brought against Defendants by Ms. Tashjian and her daughter.  (Ibid.)  This settlement amount is the remaining policy limit after the policy paid for the vehicle damages.  (Wagner Dec. ¶ 9.)

The settling parties are Cass Enterprises, Inc., Cruisers Car Wash, Dajat Zarookian, Cirano Mercado, Casro, Golnaraghi Enterprises, LP, Maria Palomeque, Alfredo Palomeque, Jessica Tashjian, and Jessica Franco Tashjian as Guardian ad Litem for Elane Mariy Franco.  (Wagner Dec., ¶ 7.)

Wagner states the settlement is not grossly disproportionate to what a reasonable person would estimate liability to be given the Claimants personal injuries and medical treatment. (Wagner Dec., ¶ 9.)

The Court finds that the application is deficient because Wagner’s declaration merely states the settlement amount and the steps leading to the settlement amount.  

The Court must be able to assess “whether the amount of settlement is within the reasonable range of the settling tortfeasor’s proportional share of comparative liability for the plaintiff’s injuries.”  (Tech-Bilt, Inc., supra, 38 Cal.3d at p. 499.)  The Wagner declaration does not allow the Court to make such an assessment. Although the factors in Tech-Bilt are nonexclusive, Mr. Wagner only presents the amount of the settlement while not stating any facts as to the other five factors.  (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 959.)  The Court must ensure that the settlement amount is “not . . . grossly disproportionate to what a reasonable person, at the time of settlement, would estimate the settling defendant’s liability to be.”  (Id. at p. 960.)  The motion, in its present form, does not allow the Court to make such a determination. 

Accordingly, because the Court cannot assess the good faith of the settlement, the Court denies this motion without prejudice.

ORDER

Moving parties to give notice.