Judge: Lee S. Arian, Case: 22STCV00590, Date: 2024-08-28 Tentative Ruling

Case Number: 22STCV00590    Hearing Date: August 28, 2024    Dept: 27

Hon. Lee S. Arian, Dept 27 

MOTION FOR DETERMINATION OF GOOD FAITH SETTLEMENT 

Hearing Date: 8/28/24¿ 

CASE NO./NAME: 22STCV00590 ISABEL ACEVES, AN INDIVIDUAL vs HECTOR ROMERO et al.

Moving Party: Defendant Sarah Stevens

Responding Party: City of Los Angeles

Notice: Sufficient¿ 

Ruling: MOTION FOR DETERMINATION OF GOOD FAITH SETTLEMENT IS DENIED

Background

This case arises out of an automobile collision that occurred on January 14, 2021, at or near the intersection of Oxnard Street and Lemona Avenue in Los Angeles, California. A vehicle driven by Defendant Hector Romero, in the course and scope of his employment with the City of Los Angeles, collided with the Plaintiff’s vehicle. On November 17, 2022, the City filed a Cross-Complaint against Sarah Stevens. On May 18, 2023, Plaintiff filed a Doe amendment naming Stevens as a defendant. On July 8, 2024, Plaintiff and Defendant Stevens entered into a written settlement agreement for her policy limit of $15,000. Defendant Stevens now moves the Court for a Determination of Good Faith Settlement.

Legal Standard

In a case involving two or more alleged joint tortfeasors, a party may seek a court order under Code of Civil Procedure section 877.6 determining that a settlement between the plaintiff and one or more of the alleged tortfeasors is in good faith. A judicial determination of good faith “bar[s] any other joint tortfeasor … from any further claims against the settling tortfeasor … for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault.” (Code Civ. Proc. § 877.6(c).)

In evaluating whether a settlement has been made in good faith, courts consider the following factors, as set forth by the California Supreme Court in the landmark case Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488:

        1) “a rough approximation of plaintiffs’ total recovery”; 

        2) “the settlor’s proportionate liability”; 

3) “the amount paid in settlement”; 

        4) “the allocation of the settlement proceeds among plaintiffs”; 

5) “a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial”; 

        6) the settling party's “financial conditions and insurance policy limits”; 

7) any evidence of “collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.” (Id. at 499.)

“Practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement.” (Ibid.) The “good faith” concept in Code of Civil Procedure section 877.6 is a flexible principle imposing on reviewing courts the obligation to guard against the numerous ways in which the interests of nonsettling defendants may be unfairly prejudiced. (Rankin v. Curtis (1986) 183 Cal. App. 3d 939, 945.) Accordingly, under Tech-Bilt, the party asserting the lack of “good faith” may meet this burden by demonstrating that the settlement is so far "out of the ballpark" as to be inconsistent with the equitable objectives of the statute. (Tech-Bilt, supra, 38 Cal.3d at 499-500.) Such a demonstration would establish that the proposed settlement was not a “settlement made in good faith” within the terms of section 877.6. (Ibid.)  

The California Supreme Court explained that Code of Civil Procedure section 877.6 is designed to further two equitable policies:

1) encouragement of settlements; and  

2) equitable allocation of costs among joint tortfeasors. (Ibid.)

Those policies would not be served by an approach which emphasizes one to the virtual exclusion of the other. (Ibid.) Accordingly, a settlement will not be found in good faith unless the amount is reasonable in light of the settling tortfeasor's proportionate share of liability. (Std. Pac. of San Diego v. A. A. Baxter Corp. (1986) 176 Cal. App. 3d 577, 589.) Or, as the California Supreme Court has stated, a “defendant’s settlement figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate the settling defendant’s liability to be.” (Tech-Bilt, supra, 38 Cal.3d at 499.) 

When a good faith motion is contested, the moving parties have the initial burden of producing evidence in support of the requested good faith determination. (Id. at 1261-62.) “Section 877.6 and Tech-Bilt require an evidentiary showing, through expert declarations or other means, that the proposed settlement is within the reasonable range permitted by the criterion of good faith.” (Mattco Forge v. Arthur Young & Co. (1995) 38 Cal.App.4th 1337, 1351.) “Substantial evidence” is required. (Id. at p. 1352.) A declaration from a settling defendant’s attorney that states, in conclusory fashion, that the client has little, or no share of the liability may not be sufficient. (Greshko v. County of Los Angeles (1987) 194 Cal.App.3d 822, 834-35; see also 3 Weil & Brown, California Practice Guide: Civil Procedure Before Trial (The Rutter Group 2023) ¶¶ 12:774, 12:872-873.)   

The ultimate burden of persuasion is on the party opposing the good faith determination.  The “party asserting a lack of good faith shall have the burden of proof on that issue.”  (Code Civ. Proc. § 877.6(d); see also 3 Weil & Brown, supra, at ¶ 12:875.)  

Discussion

Defendant Stevens failed to address several critical Tech-Bilt factors in her moving papers. First, Defendant Stevens did not provide a rough approximation of Plaintiff’s total recovery. The information presented merely details Plaintiff's medical expenses from the Incident, totaling $39,039.80. This figure fails to represent a comprehensive estimate of Plaintiff's total recovery, as it exclusively covers a single category of special damages. Importantly, there is no mention of property damage, future medical costs, or general damages.

Second, the motion omits any discussion of Defendant’s proportionate liability. From the moving papers, it remains unclear how Defendant Stevens is involved in this matter. Defendant notes that a cross-complaint was filed against her and that she was named as a Doe defendant; however, no factual details are provided to explain why the cross-complaint was filed against her or her involvement in the incident.

Third, Defendant represents that the settlement amount of $15,000 comprises the entirety of Defendant’s policy limit. However, no information is provided regarding Plaintiff’s financial conditions. A settlement amount, though fully exhausting the policy limits, might still be considered disproportionate considering Defendant's additional financial resources.

The purpose of the Tech-Bilt factors are to enable the Court to determine whether the settlement amount is grossly disproportionate to Defendant's share of liability in relation to Plaintiff’s total damages. Without an estimate of Plaintiff’s total damages and Defendant’s estimated share of liability, the Court cannot properly assess whether the settlement was made in good faith. Consequently, the motion is denied.

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.