Judge: Lee S. Arian, Case: 21STCV12624, Date: 2024-02-16 Tentative Ruling
Case Number: 21STCV12624 Hearing Date: March 19, 2024 Dept: 27
Complaint Filed: 4/2/21
¿
Hon. Lee S. Arian¿
Department 27¿
Tentative Ruling¿
Hearing Date: 3/19/2024 at 1:30 p.m.¿
Case No./Name: 21STCV12624 MARGARET BOCK, AN INDIVIDUAL vs
CITY OF LA MIRADA
Motion: Motion Contesting Good Faith Settlement
Moving Party: Defendant West Coast Arborist, Inc.
Responding Party: Plaintiff and Defendant City of La Mirada
Notice: Sufficient¿
Ruling: Motion Contesting Good Faith Settlement Is
DENIED.
Background
On
May 3, 2020, Plaintiff allegedly tripped and fell on a portion of uplifted
sidewalk in the City of La Mirada. Plaintiff filed the present lawsuit on April
2, 2021, against Defendants City of La Mirada and West Coast Arborists (WCA).
WCA was tasked with performing tree trimming services and reporting any
hazardous conditions to the City. Despite conducting tree trimming services on
December 19, 2019, WCA failed to report the hazardous uplifted sidewalk. Under
the service contract between the City and WCA, WCA was to indemnify and defend
the City against claims arising from services rendered by WCA, including not
reporting unsafe conditions. On January 10, 2024, the City and Plaintiff
entered into a settlement agreement for $25,000 and filed an application for
determination for a good faith settlement. WCA filed the present motion
challenging the settlement, arguing that the amount does not reflect the City's
proportionate liability and suggests collusion to the disadvantage of WCA. In
opposition, the City and Plaintiff contend that the $25,000 settlement is reasonable
and argue that WCA’s claim for collusion is unsubstantiated.
Legal Standard
CCP section 877.6(a)(1) provides that “[a]ny
party to an action wherein 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 . . .
and one or more alleged tortfeasors or co-obligors . . . .”¿ (Code. Civ. Proc., § 877.6(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.”¿ (Id., § 877.6(c).)¿ Although
a determination that a settlement was in good faith does not discharge any
other party from liability, “it shall reduce the claims against the others in the amount
stipulated” by the settlement.¿ (Id., § 877(a).)¿
¿
Factors to consider in determining if a
settlement was made in good faith 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.”¿ (Tech-Bilt,
Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.)¿ “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 nonsettling defendants.”¿ (Id.)¿
¿
The evaluation of whether a settlement was
made in good faith is required to “be made on the basis of information
available at the time of settlement.”¿ (Tech-Bilt,
Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.)¿ “[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.”¿ (TSI
Seismic Tenant Space, Inc. v. Superior Court (2007) 149 Cal.App.4th 159,
166.)¿ “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.”¿ (Id.)¿
¿
“The party asserting the lack of good faith
shall have the burden of proof on that issue.”¿ (Code Civ. Proc., § 877.6(d).)¿ The
party asserting the lack of good faith can establish that the proposed
settlement was not a settlement made in good faith by showing the settlement is
so far “out of the ballpark” in relation to the Tech-Bilt factors as to
be inconsistent with the equitable objectives of the statute.¿ (Tech-Bilt, Inc., supra, 38 Cal.3d at 499-500.)¿
Analysis
The Court reviewed City’s application for a
good faith settlement, filed on January 10, 2024. The settling parties met
their initial burden by addressing each of the Tech-Bilt factors. The
settlement amount was $25,000. While total damages were not specified, it could
be approximated from special damages in terms of medical expenses of
approximately $15,000. City claims it has no liability based on WCA's failure
to report the hazardous condition and WCA’s obligation to indemnify and defend
City for its failure to report any potentially unsafe or hazardous condition.
Once the settling party addressed the Tech-Bilt factors, it is “the party asserting the lack of good faith shall
have the burden of proof on that issue.” (Code Civ. Proc., § 877.6(d).) The party asserting the lack of good faith
can establish that the proposed settlement was not a settlement made in good
faith by showing the settlement is so far “out of the ballpark” in relation to
the Tech-Bilt factors as to be inconsistent with the equitable
objectives of the statute. (Tech-Bilt, Inc., supra, 38 Cal.3d at 499-500.) The
ultimate determinant of good faith is whether the settlement is grossly
disproportionate to what a reasonable person at the time of settlement would
estimate the settlor's liability to be. (Torres v. Union Pacific R.R.
Co. (1984) 157 Cal.App.3d 499, 509.) “[T]he damages are often
speculative, and the probability of legal liability therefore is often
uncertain....” (Stambaugh v. Superior Court (1976) 62 Cal.App.3d 231,
238.)
In the motion, WCA disputes the city's assertion of
no liability but fails to demonstrate that the settlement is excessively
disproportionate or "out of the ballpark." Plaintiff’s special damages
based on her medical expenses amounts to $15,748.00, and given that general
damages are typically triple the special damages, the total valuation of the
case can reasonably be estimated to be just under $100,000. Even if the city is
assumed to bear some liability, a $25,000 settlement is not “grossly disproportionate”
or “out of the ball park”. In certain instances, a $30,000
settlement in a lawsuit valued at $1 million was found to be in good faith,
even though the settling defendant was deemed at least 50% responsible for
Plaintiff's injuries. (County of Los Angeles v. Guerrero (1989) 209
Cal.App.3d 1149, 1156.) In County of Los Angeles v. Guerrero, the ratio
of settlement to total damages was 3% for a party 50% liable, and in the
current case, the ratio would be 25% for a portion of the liability.
Furthermore, MCA did not provide any evidence to suggest that the total damages
substantially exceed those estimated from Plaintiff's special damages.
The Court is not persuaded by WCA's contention that
the settlement was not made in good faith. WCA alleges that La Mirada's failure
to present Mark Stowell, its Director of Public Works and City Engineer, for
deposition is evidence of collusion. However, Mark Stowell's deposition did
take place, and WCA's motion for additional deposition testimony from Mark
Stowell was denied by the Court.
Accordingly, the court DENIES Defendant WCA’s Motion
Contesting Good Faith Settlement between City and Plaintiff and APPROVES City’s
Application for Determination of Good Faith Settlement.
PLEASE TAKE NOTICE:
If a
party intends to submit on this tentative ruling, the party must send an email to the court at sscdept27@lacourt.org with the Subject line “SUBMIT” followed by
the case number. The body of the email must include the
hearing date and time, counsel’s contact information, and the identity of the
party submitting.
Unless all parties submit by email to this tentative
ruling, the parties should arrange to appear remotely (encouraged) or in person
for oral argument. You should assume that others may appear at
the hearing to argue.
If
the parties neither submit nor appear at hearing, the Court may take the motion
off calendar or adopt the tentative ruling as the order of the Court. After the Court has issued a tentative
ruling, the Court may prohibit the withdrawal of the subject motion without
leave.
¿PLEASE TAKE NOTICE:¿¿¿¿¿¿¿
¿¿¿¿
If a party intends to submit on
this tentative ruling,¿the party must send an email to the court at¿sscdept27@lacourt.org¿with the Subject line “SUBMIT”
followed by the case number.¿ The body of the email must include the hearing date
and time, counsel’s contact information, and the identity of the party
submitting.¿¿¿¿¿¿¿¿¿
¿¿
Unless¿all¿parties submit by email to this
tentative ruling, the parties should arrange to appear remotely (encouraged) or
in person for oral argument.¿ You should assume that others may appear at the
hearing to argue.¿¿¿¿¿¿¿¿¿
¿¿
If the parties neither submit nor appear at hearing,
the Court may take the motion off calendar or adopt the tentative ruling as the
order of the Court.¿ After the Court has issued a tentative ruling, the Court may
prohibit the withdrawal of the subject motion without leave.¿¿¿¿¿¿¿¿