HON. LEE S. ARIAN 

DEPARTMENT 27 

TENTATIVE RULING 

 

Hearing Date: 3/27/2024 at 1:30 p.m. 

Case No./Name: 22STCV17233 JULIE LAWLOR vs BKM OFFICE FURNITURE 

Motion: MOTION TO CHALLENGE THE GOOD FAITH OF A SETTLEMENT 

Moving Party: Defendant BKM Office Environments Inc. 

Responding Party: Defendant Francisco Rivera 

Notice: Sufficient 

 

Ruling: MOTION TO CHALLENGE THE GOOD FAITH OF A SETTLEMENT IS DENIED. 

 

 

Legal Standard 

 

In an action involving two or more joint tortfeasors or co-obligors, when one tortfeasor or obligor enters into a settlement with the plaintiff, the other tortfeasors or obligors are entitled to a hearing on the issue of whether the settlement was entered into in good faith.¿ (Code Civ. Proc., § 877.6(a).)¿ Where a plaintiff settles with one of several joint tortfeasors or co-obligors without releasing the others, a determination of “good faith” discharges the settling defendant from liability to the other defendants for equitable contribution or comparative indemnity.¿ (CCP § 877(a)-(b).)¿ The amount paid by the settling defendant reduces the claim against the others (CCP § 877(a)), but a risk of prejudice remains because an unreasonably low settlement (i.e., with the “most culpable” tortfeasor) exposes the remaining defendants to a judgment exceeding their fair share of the liability.¿ (See Bay Development, Ltd. v. Superior Court (1990) 50 Cal. 3d 1012, 1019-1020.)¿¿¿ 

 

There is no precise yardstick for measuring the “good faith” of a settlement with one of several tortfeasors, but it must harmonize the public policy favoring settlements with the competing public policy favoring equitable sharing of costs among tortfeasors.¿ (See Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499.)¿ 

¿ 

“A more appropriate definition of ‘good faith,’ in keeping with the policies of American Motorcycle and the statute, would enable the trial court to inquire, among other things, 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.¿ This is not to say that bad faith is ‘established by a showing that a settling defendant paid less than his theoretical proportionate or fair share.’ [Citation.]¿ Such a rule would unduly discourage settlements.¿ ‘For the damages are often speculative, and the probability of legal liability therefor is often uncertain or remote.¿ And even where the claimant's damages are obviously great, and the liability therefor certain, a disproportionately low settlement figure is often reasonable in the case of a relatively insolvent, and uninsured, or underinsured, joint tortfeasor.’ [Citation.]¿ Moreover, such a rule would tend to convert the pretrial settlement approval procedure into a full scale mini trial [citation].¿ 

¿ 

“But these considerations do not lead to the conclusion that the amount of the settlement is irrelevant in determining good faith.¿ Rather, the intent and policies underlying section 877.6 require that a number of factors be taken into account including 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.¿ 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. [Citation.]¿ Finally, practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement.¿ ‘[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.’ [Citation.]¿ The party asserting the lack of good faith, who has the burden of proof on that issue (§877.6(d)), should be permitted to demonstrate, if he can, that the settlement is so far ‘out of the ballpark’ in relation to these factors as to be inconsistent with the equitable objectives of the statute.¿ Such a demonstration would establish that the proposed settlement was not a ‘settlement made in good faith’ within the terms of section 877.6.¿¿¿ 

 

(Tech-Bilt, Inc., 38 Cal.3d at 499-500.) 

¿ 

Section 877.6 contemplates that the determination of good faith may be made by the court on the basis of affidavits (subd. (b)), and as the court observed in River Garden Farms, ‘The price levels are not as unpredictable as one might suppose.¿ Despite the uncertainties, generalized valuation criteria are recognized by the personal injury bar, insurance claims departments and pretrial settlement courts.¿When testing the good faith of a settlement figure, a court may enlist the guidance of the judge's personal experience and of experts in the field.¿ Represented by knowledgeable counsel, settlement negotiators can predict with some assurance whether a settlement is within the reasonable range permitted by the criterion of good faith.¿ The danger that a low settlement violates the good faith clause will not impart uncertainty so long as the parties behave fairly and the courts maintain a realistic awareness of settlement imponderables.’ [Citation.]¿ 

 

(Id. at 500-01.)¿¿¿ 

 

Background and Analysis 

On May 22, 2022, plaintiff filed the present complaint alleging that prior to starting her shift as an occupational therapist, an overhead office cabinet fell off the wall and struck her in the head. Defendant BKM was contracted for the installation of cabinets and various other office furniture at the medical center but subcontracted the installation of the specific cabinet involved in the incident to Defendant Rivera. This incident allegedly led to head injuries and long-term disability for the Plaintiff, significantly impacting her capacity to work. 

On April 20, 2023, Safety National Casualty Company, the workers' compensation insurer for Plaintiff's employer, filed a complaint-in-intervention to recoup workers' compensation benefits disbursed to Plaintiff against both Defendants Rivera and BKM. Subsequently, on December 14, 2023, Rivera, Plaintiff, and Safety National Casualty Company reached a settlement agreement for Rivera's insurance limit of $1,000,000. On January 23, 2024, Defendant Rivera submitted a motion for a good faith settlement, stating that the total liability is estimated between $1.5 to $2 million, with their liability assessed at 65-75%, and proposing a settlement of $1 million. A portion of the settlement will go to Plaintiff’s workers compensation. 

Defendant argues that the total case value significantly exceeds the settlement amount, estimating it at $5 million, and contends that Rivera's $1 million settlement with Plaintiff is unreasonably low. However, the Court disagrees with this assessment for several reasons. First, the settlement amount represents Rivera's insurance limit. Courts have found good faith settlements for settlement for ratios far lower than in the present case. Second, even within the context of a potential $5 million valuation, a $1 million settlement is deemed reasonable for a pretrial agreement. It certainly is within the ballpark of an equitable settlement. Plaintiff still needs to establish liability at trial, which remains uncertain. Moreover, Defendant BKM's recent motion for summary judgment was denied and BKM shares a portion of the liability with Rivera. Thus, the Court GRANTS Defendant Rivera’s application for good faith settlement and DENIES the present motion. 

 

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.