Judge: Joel L. Lofton, Case: 19STCV14782, Date: 2022-12-06 Tentative Ruling

Case Number: 19STCV14782    Hearing Date: December 6, 2022    Dept: X

   Tentative Ruling

Judge Joel L. Lofton, Department X

HEARING DATE:     December 6, 2022                               TRIAL DATE:  December 6, 2022

CASE:                         KATHERINE M. STRIDE, v. LANCE YANG, MELANIE YANG, AND DOES 1-100

CASE NO.:                 19STCV14782

EX PARTE APPLICATION FOR DETERMINATION OF GOOD FAITH SETTLEMENT

MOVING PARTY:              Defendant Arroyo Oaks Homeowners Association

RESPONDING PARTY:      Cross-Defendant Michael Messain

SERVICE:                              Filed November 28, 2022

OPPOSITION:                       Filed November 29, 2022

RELIEF REQUESTED

            Defendant Arroyo Oaks Homeowners Association files this ex parte application for determination of good faith settlement.

BACKGROUND

            This case arises out of a Plaintiff Katherine M. Stride’s (“Plaintiff”) claim that her condominium unit suffered extensive water damage caused by the owners of the condominium unit above hers. Plaintiff filed this complaint on April 29, 2019, against Defendants Lance Yang, Melanie Yang, Michael Messian (“Messian”), previously Doe 1, and Arroyo Oaks Homeowners Association (the “HOA”), previously Doe 2, (collectively “Defendants”) alleging three causes of action for (1) trespass, (2) nuisance, and (3) negligence.

TENTATIVE RULING

            The HOA’s ex parte application for determination of good faith settlement is GRANTED.

LEGAL STANDARD

“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”. (Code Civ. Proc. section 877.6, subd. (a)(1).) “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. section 877.6, subd. (c).)

            One consideration for whether a settlement was made in good faith is “whether the amount of the settlement is within the reasonable range of the settling tortfeasor's proportional share of comparative liability for the plaintiff's injuries.” (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.) The California Supreme Court, in Tech-Bilt, also stated that relevant factors include “a rough approximation of plaintiffs' total recovery and the settlor's proportionate liability, the amount paid in settlement, the allocation of settlement proceeds among plaintiffs, and a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial.” (Ibid.)

            “Accordingly, a court not only looks at the alleged tortfeasor's potential 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.” (TSI Seismic Tenant Space, Inc. v. Superior Court (2007) 149 Cal.App.4th 159, 166.)

“If the good faith settlement is contested, section 877.6, subdivision (d), sets forth a workable ground rule for the hearing by placing the burden of proving the lack of good faith on the contesting party. Once there is a showing made by the settlor of the settlement, the burden of proof on the issue of good faith shifts to the non-settlor who asserts that the settlement was not made in good faith. (Fisher v. Superior Court (1980) 103 Cal.App.3d 47; § 877.6, subd. (d).) If contested, declarations by the non-settlor should be filed which in many cases could require the moving party to file responsive counterdeclarations to negate the lack of good faith asserted by the non-settling contesting party.” (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261.)

DISCUSSION

             The HOA provides that it has reached a settlement agreement with Plaintiff where Plaintiff dismisses the HOA in exchange for a settlement amount totaling $10,001. (Dilts Decl. ¶ 4.) The HOA provides that the settlement agreement was executed on October 31, 2022, and Plaintiff filed a dismissal of the HOA on November 7, 2022. (Ibid.)

            The HOA argues that the $10,001 settlement is roughly 20% of the estimated maximum recovery of $50,000. The HOA also argues that there is additionally no evidence supporting the HOA was at fault for the alleged damages, such as a common area pipe or drain line failure.

            In opposition, Messian argues that the HOA has not demonstrated this ex parte application is warranted because the HOA has not demonstrated irreparable harm or immediate danger. However, the HOA provides that at the time of filing the ex parte application, the soonest its motion for determination of good faith settlement could be heard was December 14, 2022, after the then-set trial date of December 1, 2022. (Dilts Decl. ¶ 5.)

            Further, Code of Civil Procedure section 877.6, subdivision (a)(1), provides in part: “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.” Here, the HOA has demonstrated good cause exists to shorten the time to determine the merits of the settlement.

            Messian next argues that his claim for indemnity survives a determination of good faith settlement.

            “A settling tortfeasor's section 877.6, subdivision (c) good faith settlement determination discharges indemnity claims by other tortfeasors, whether or not named as parties, so long as the other tortfeasors were given notice and an opportunity to be heard.” (Gackstetter v. Farawley (2006) 135 Cal.App.4th 1257, 1273.) “[A]n indemnity claim against a codefendant based on express contract survives a good faith section 877.6 settlement.” (C. L. Peck Contractors v. Superior Court (1984) 159 Cal.App.3d 828, 834.)

            However, Messian does not cite any express contract detailing a claim for indemnity but rather points to the HOA’s covenants, conditions, and restrictions that pertain to insurance subrogation claims. Messian also argues that he should be a third-party beneficiary to the HOA’s insurance policy without citing any authority or any basis for his claim. Both of Messian’s arguments are rejected.

            Messian also makes the claim that the settling parties must prove that Messian is a tortfeasor under Code of Civil Procedure section 877.6. Messian incorrectly states the standard applied under a motion for determination of good faith settlement. In fact, the statute itself specifically provides  that “[t]he party asserting the lack of good faith shall have the burden of proof on that issue.” (Code of Civil Procedure section 877.6.) Messian has failed to do so here.

CONCLUSION

            The HOA’s ex parte application for determination of good faith settlement is GRANTED.

Dated:   December 6, 2022                             ___________________________________

                                                                                    Joel L. Lofton

                                                                                    Judge of the Superior Court