Judge: Helen Zukin, Case: SC127112, Date: 2022-10-04 Tentative Ruling

Case Number: SC127112    Hearing Date: October 4, 2022    Dept: 207

Background

Plaintiff Billy Ray Gallion ("Plaintiff") alleges that he was subjected to uninhabitable living conditions while residing in Unit 11 at 1508 12th St., Santa Monica, California 90401 (the “Property”). Plaintiff alleges his unit was delivered with and/or subsequently developed dangerous and hazardous conditions, including mold growth, which caused him injuries. Plaintiff’s unit represents one of eleven units at the Property. The remaining ten units at the Property together form a common interest development subject to the Davis-Stirling Common Interest Development Act (“Davis-Sterling Act”) (Civ. Code, § 4000 et seq.). The development is governed by the Fifteen Zero Eight Twelfth Street Homeowners Association (“HOA”) and is subject to recorded covenants, conditions, and restrictions (“CC&R's”). The daily operations of the HOA were conducted by BLN Property Management, Inc. (“BLN”), a management company.

Defendant David Resnik (“Defendant”) owned the unit directly above Plaintiff’s unit from February 2015 until December 2016. Defendant has reached a settlement with Plaintiff and now moves the Court for a determination that this settlement was entered into in good faith pursuant to Code Civ. Proc. § 877.6. Defendant’s motion is unopposed.

Good Faith Settlement Standard

The Court must approve any settlement entered into by less than all joint tortfeasors or co-obligors. (C.C.P. § 877.6.) This requirement furthers two sometimes-competing policies: (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.)

If the settlement is made in good faith, the Court “shall bar any other joint tortfeasor or co-obligor from any further claims against the settling tortfeasor . . . for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault.” (C.C.P. § 877.6(c).) The non-settling tortfeasors or obligors bear the burden of demonstrating the absence of good faith in the settlement. (C.C.P. § 877.6(d).)

In order to demonstrate a lack of good faith, the non-settling party must show the settlement is so far “out of the ballpark” as to be inconsistent with the equitable objectives of section 877.6. (Nutrition Now, Inc. v. Superior Court (2003) 105 Cal.App.4th 209, 213.) The Court will typically consider: (1) the plaintiff’s (roughly) approximated total recovery; (2) the settlor’s share of liability; (3) the size of the settlement at issue; (4) the distribution of settlement proceeds among plaintiffs; (5) the usual discount value when plaintiffs settle before trial; (6) the settlor’s financial condition and insurance policy limits; and (7) whether there is evidence of “collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.” (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499 (Tech-Bilt).) “Another key factor is the settling tortfeasor's potential liability for indemnity to joint tortfeasors.” (Long Beach Memorial Medical Center v. Superior Court (2009) 172 Cal.App.4th 865, 873 [as modified (Apr. 1, 2009].)

These factors will be evaluated accordingly to what information is available at the time of settlement. (Ibid.)

Analysis

Defendant and Plaintiff have agreed to settle Plaintiff’s claims against Defendant in exchange for a payment of $232,500. Defendant has provided an analysis of Plaintiff’s claims and damages, including Defendant’s role as compared to other Defendants in this action. Defendant estimates Plaintiff’s potential total recovery to be in the range of $1.5 million to $3 million. Using these figures for the value of Plaintiff’s claim—which no party disputes—would mean Defendant’s $232,500 settlement would account for approximately 10% of Plaintiff’s potential recovery.

The Court is satisfied the $232,500 settlement is within the “ballpark” of Defendant’s proportionate share of liability. Defendant argues his potential liability to Plaintiff is limited here as Defendant only briefly owned his unit and puts forth evidence in his moving papers showing the two leaks during the timeframe of his ownership are not attributable to him. (Wrighten Decl. at ¶ 4.) Defendant alleges the first of these leaks was determined to be caused by a drainpipe issue in a common area for which the HOA was responsible and the second leak was never shown to be caused by any issue in him unit. (Motion at 7-8.) On such facts, the $232,500 settlement is reasonable, particularly when considering the discount afforded to settlement figures where, as here, a claim is resolved before trial.

The Court finds the remaining Tech-Bilt factors are satisfied as well. There is only one Plaintiff in this action, so there are no concerns regarding the allocation of settlement funds between multiple plaintiffs. The Court also finds no evidence of collusion, fraud, or other tortious conduct on behalf of Plaintiff or Defendant, and the Court notes no other party has opposed this motion or otherwise suggested any such fraud or collusion is present here.

On such facts, the Court finds the settlement between Plaintiff and Defendant was entered into in good faith under Code Civ. Proc. § 877.6 and accordingly Defendant’s motion is GRANTED.

Conclusion

Defendant’s motion for determination of good faith settlement is GRANTED.