Judge: Lisa R. Jaskol, Case: 20STCV14705, Date: 2023-11-21 Tentative Ruling
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Case Number: 20STCV14705 Hearing Date: March 7, 2024 Dept: 28
Having considered the petitioning papers, the Court rules as follows.
BACKGROUND
On April 16, 2020, Plaintiff Xiaoling Mai (“Plaintiff”) filed this action against Defendants County of Los Angeles (“County”), City of Industry (“City”), Ramon Ochoa Franco, and Does 1-10 for motor vehicle tort, general negligence, and premises liability (dangerous condition of public property).
On November 30, 2020, the City filed an answer.
On December 1, 2020, the Court dismissed the County with prejudice at Plaintiff’s request.
On March 2, 2021, the City filed a cross-complaint against Cross-Defendants Ramon Ochoa Franco and Roes 1-10 for equitable indemnity, contribution, and declaratory relief.
On March 24, 2021, Ramon Ochoa (erroneously sued and served as Ramon Ochoa Franco) (“Ochoa”) filed an answer to Plaintiff’s complaint and a cross-complaint against Cross-Defendants City and Roes 1-20 for indemnity and contribution. On April 21, 2021, the City filed an answer to Ochoa’s cross-complaint.
On May 15, 2023, Plaintiff filed a notice of settlement.
On July 19, 2023, the Court granted Plaintiff’s request to appoint Yu Mai as Plaintiff’s guardian ad litem.
On November 21, 2023, the Court granted the City’s motion for a good faith settlement determination.
On December 22, 2023, Petitioner Yu Mai (“Plaintiff”) filed a petition to approve the compromise of Plaintiff’s claim, to be heard on January 17, 2024. The Court continued the hearing to March 7, 2024.
No trial date is currently scheduled.
PETITIONER’S REQUEST
Petitioner Yu Mai asks the Court to approve the compromise of the pending action of Plaintiff Xiaoling Mai.
LEGAL STANDARD
The parties to a lawsuit may settle the claim of a person who lacks the capacity to make decisions only with court approval. (Prob. Code., §§ 2504, 3500, 3600 et seq.; Code Civ. Proc., § 372; see Pearson v. Superior Court (2012) 202 Cal.App.4th 1333, 1337.)
A petition for court approval of a compromise or covenant not to sue under Code of Civil Procedure section 372 must comply with California Rules of Court, rules 7.950, 7.951 and 7.952. The petition must be verified by the petitioner and contain a full disclosure of all information that has “any bearing upon the reasonableness” of the compromise or the covenant. (Cal. Rules of Court, rule 7.950.)
The person compromising the claim on behalf of the person who lacks capacity, and the represented person, must attend the hearing on compromise of the claim unless the court for good cause dispenses with their personal appearance. (Cal. Rules of Court, rule 7.952.)
DISCUSSION
A. Non-trust issues
Section 12a(1) of the petition states that total medical expenses were $902,364.88. Section 12a(3) states that, of this amount, $543,686.28 was the subject of negotiated, contractual, or statutory reductions. This should mean that the difference between these two amounts – $358,678.60 – will be paid or reimbursed from the settlement proceeds. However, Section 12a(4) states that only $91,910.17 will be paid or reimbursed from the settlement proceeds.
Petitioner should explain why $266,768.43 in medical expenses (the difference between $358,678.60 and $91,910.17) will not be paid or reimbursed from the settlement proceeds. The Court cannot approve a compromise unless all medical expenses that have not been waived or reduced are paid or reimbursed from the settlement proceeds.
B. Special needs trust
The main requirements for court created or funded trusts are set forth at California Rules of Court, rule 7.903(c), and LASC rule 4.116(b). The proposed trust instrument meets those requirements and is ready for approval for creation and/or funding.
Petitioner makes the following additional requests for relief that are beyond those fundamental to the approval and funding of a settlement trust:
Petitioner requests authority for trustee to invest in proprietary funds, mutual funds, and bonds with maturity dates greater than five years to provide for diversification and a higher rate of investment return. (Court’s pdf at p. 63, para. 3.) This request would provide for a broader investment authority than the statutory baseline. The Court grants this request.
The proposed initial trustee is Lilit Movsesyan, a private professional fiduciary (PPF) in Glendale, California. Normally, bond is required of a trustee unless the trustee is a corporate fiduciary. (Cal. Rules of Court, rule 7.903(c)(5); Prob. Code, § 2320.) A PPF does not meet that definition and bond is required.
Petitioner requests a $75,340.26 bond. The calculation appears to be correct based on the assets to be funded into the trust, plus anticipated annual income from investments and any annuity, plus an additional amount required for the costs of any recovery on the bond.
The Court orders that the $75,340.26 bond be submitted by the trustee to this department. The bond will later be resubmitted to the Probate Court in any trust supervision action.
ORDERS/PROPOSED ORDER:
The proposed order should be modified to add a 14-month calendar date for the first accounting due date (at p. 30, para. 9 of the proposed order).
In addition, the proposed order should be modified to add a 60-day calendar date for an OSC in this civil department to ensure funding of the settlement, submission of the bond, purchase of an annuity (if relevant), and filing of LASC Form PRO 044 to open a trust supervision action in the Probate Court (at p. 30 of proposed order).
CONCLUSION
The Court CONTINUES the hearing on the petition to approve the compromise of Plaintiff Xiaoling Mai’s action to a date to be provided at the March 7, 2024 hearing.
Moving party is ordered to give notice of this ruling.
Moving party is ordered to file a proof of service of this ruling with the Court within five days.