Judge: Joel L. Lofton, Case: 21AHCV00119, Date: 2023-09-19 Tentative Ruling
Case Number: 21AHCV00119 Hearing Date: February 6, 2024 Dept: X
Tentative Ruling
Judge Joel L. Lofton,
Department X
HEARING DATE: February 6, 2024 TRIAL
DATE: No date set.
CASE: V&K
PROPERTIES, LLC v. AMGUARD INSURANCE COMPANY; PROLINK ELITE FINANCIAL &
INSURANCE SERVICES, and DOES 1-10.
CASE NO.: 21AHCV00119
MOTION
FOR DETERMINATION OF GOOD FAITH SETTLEMENT
MOVING PARTY: Defendant Prolink Elite Financial
& Insurance Services
RESPONDING PARTY: Defendant
Amguard Insurance Company
SERVICE: Filed January 9, 2024
OPPOSITION: Filed January 23, 2024
REPLY: Filed January 30, 2024
RELIEF
REQUESTED
Prolink moves to file its motion
for determination of good faith settlement under seal and for a determination
its settlement with Plaintiff was made in good faith.
BACKGROUND
This case arises out of Plaintiff V&K
Properties, LLC’s (“Plaintiff”) claim that Defendants Amguard Insurance Company
(“AIC”) and Prolink Elite Financial & Insurance Services (“Prolink”)
(collectively “Defendant”) engaged in bad faith while handling Plaintiff’s
insurance claim for its property in Fremont, California. Plaintiff filed a
first amended complaint on May 18, 2023, alleging three causes of action for
(1) breach of contractual duty to pay covered insurance claim, (2) breach of
the implied covenant of good faith and fair dealing, and (3) negligence.
TENTATIVE RULING
Prolink’s motion to file its motion under seal is
GRANTED.
Prolink’s motion for determination of good faith settlement is
GRANTED pursuant to an in camera review of the terms of the settlement.
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).)
“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.)
DISCUSSION
Prolink moves for a determination that its settlement with Plaintiff was
made in good faith. As a preliminary matter, Prolink also moves to file its
motion under seal.
California Rules of Court Rule 2.550, subdivision
(d), provides: “The court may order that a record be filed under seal only if
it expressly finds facts that establish: [¶] (1) There exists an overriding interest that
overcomes the right of public access to the record; [¶] (2) The overriding interest supports sealing
the record; [¶] (3) A
substantial probability exists that the overriding interest will be prejudiced
if the record is not sealed; (4) The proposed sealing is narrowly
tailored; and [¶] (5) No less
restrictive means exist to achieve the overriding interest.”
Prolink moves to submit the specific
amounts for settlement and related information under seal. Prolink provides
that the terms of the settlement provide that the settlement must be kept
confidential. (Ta Decl. ¶ 4.) Prolink has demonstrated an overriding interest in keeping
the amount of the settlement sealed and that it will face prejudice if the
information is not sealed. Further, Prolink’s request is specific to the
settlement amount and closely related information and is narrowly tailored.
Prolink’s motion to file its motion for determination of good faith settlement
under seal is granted.
The next issue is whether Prolink’s settlement with
Plaintiff was made in good faith. In opposition, AmGuard contends that this
motion should not be granted for a variety of reasons. However, it appears that
AmGuard’s primary concern is the existence of express indemnity agreement
between Prolink and AmGuard.
Code of Civil Procedure section 877, subdivision (c),
provides that: “This section shall not apply to co-obligors who have
expressly agreed in writing to an apportionment of liability for losses or
claims among themselves.” Thus, the existence or enforceability of a
contractual agreement between Prolink and AmGuard for indemnity is not affected
by the present motion.
“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.)
AmGuard also opposes this motion
based on its contention that it is not a joint tortfeasor. AmGuard specifically
argues that it and Prolink are “not ‘claimed to be liable for the same tort’ ”.
(Opposition at p. 3:17.) However, that is not the language of the statute. Code
of Civil Procedure section 877.6 provides a motion for determination of good
faith settlement may be made where it is “alleged that two or more parties are
joint tortfeasors”. That is the case here.
AmGuard also argues John Hancock
Mutual Life Ins. Co. v. Setser (1996) 42 Cal.App.4th 1524, provides that
this motion should be denied. Again, AmGuard primary contention is that a valid
agreement exists between the parties and that therefore the settlement should
not be found to be made in good faith. However, that issue is already settled. “[O]ur
Supreme Court has held that a good faith settlement does not relieve a settling
tortfeasor of its obligations to a nonsettling defendant under the terms of
an express indemnification agreement.” (Id. at
p. 1530.) Thus, the contractual agreement is already outside of the scope of
this motion. Additionally, AmGuard has not identified the existence of a
current claim that would necessitate denying Prolink’s motion.
CONCLUSION
Prolink’s motion to file its motion under seal is
GRANTED.
Prolink’s motion for determination of good faith settlement is
GRANTED pursuant to an in camera review of the terms of the settlement.
Dated: February 6,
2024 ___________________________________
Joel
L. Lofton
Judge
of the Superior Court