Judge Lynne M. Hobbs, Case Number: 20STCV48135, Date: 2024-03-19 Tentative Ruling

Judge: Lynne M. Hobbs, Case: 20STCV48135, Date: 2024-03-19 Tentative Ruling

Case Number: 20STCV48135 Hearing Date: March 19, 2024 Dept: 30

KARLA L. SCOTT, AN INDIVIDUAL vs PALMDALE REGIONAL MEDICAL CENTER, A BUSINESS ENTITY FORM UNKNOWN

TENTATIVE

Motion for Determination of Good Faith Settlement filed by Defendant Lancaster Hospital Corporation dba Palmdale Regional Medical Center (erroneously sued as “Palmdale Regional Medical Center) is GRANTED. MPM Building Services, Inc.’s cross-complaint against Defendant Lancaster Hospital Corporation dba Palmdale Regional Medical Center is dismissed. Moving party to give notice.

Background

On December 16, 2020, Plaintiff Karla L. Scott (“Plaintiff”) commenced this action against Defendant Lancaster Hospital Corporation dba Palmdale Regional Medical Center (erroneously sued as “Palmdale Regional Medical Center”) (“PRMC”). Plaintiff later named MPM Building Services, Inc. (“MPM”) as a defendant on July 1, 2021. As alleged in the complaint, Plaintiff was visiting her mother in the hospital and had noticed an employee power washing the area near the hospital’s entrance. (Compl. ¶ 8.) When Plaintiff was leaving the hospital, she noticed that the area near the entrance was wet and decided to use the side exit in order to avoid an accident. (Ibid.) As she was walking towards the side exit, Plaintiff slipped and fell. (Ibid.)

The defendants have filed respective cross-complaints against each other for seeking equitable indemnity, contribution, and declaratory relief.

On February 22, 2024, PRMC filed the instant motion for determination of good faith settlement. On March 6, 2024, MPM filed its opposition to the instant motion. Thereafter, on March 12, 2024, PRMC filed its reply.

Trial is scheduled for May 3, 2024.

Legal Standard

The Court must approve any settlement entered into by less than all joint tortfeasors or co-obligors. (Code Civ. Proc., § 877.6.) This requirement furthers two sometimes-competing policies: (1) the equitable sharing of costs among the parties at fault, and (2) the encouragement of settlements. (Erreca’s v. Superior Court (1993) 19 Cal.App.4th 1475, 1487.)

If the settlement is made in good faith, the Court “shall bar any other joint tortfeasor or co-obligor 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, subd. (c).) The non-settling tortfeasors or obligors bear the burden of demonstrating the absence of good faith in the settlement. (Code Civ. Proc., § 877.6, subd. (d).)

In order to demonstrate a lack of good faith, the non-settling party must show that the settlement is so far “out of the ballpark” as to be inconsistent with the equitable objectives of Section 877.6. (Nutrition Now, Inc. v. Superior Court (2003) 105 Cal.App.4th 209, 213.) The Court will typically consider: (1) the plaintiff’s (roughly) approximated total recovery; (2) the settlor’s share of liability; (3) the size of the settlement at issue; (4) the distribution of settlement proceeds among plaintiffs; (5) the usual discount value when plaintiffs settle before trial; (5) the settlor’s financial condition and insurance policy limits; and (6) whether there is evidence of “collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants.” (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499 (Tech-Bilt).) These factors will be evaluated accordingly to what information is available at the time of settlement. (Ibid.)

“The trial court’s section 877.6 determination ‘should be made on the basis of experience rather than speculation.’ [Citation.] ‘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. [Citation.]’” (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 960.)

Discussion

Plaintiff and PRMC entered into a settlement wherein Plaintiff agreed to accept $740,000 in exchange for a release of PRMC from further liability. (Motion at pg. 4; Becker Decl. ¶ 7; NOL, Exh. A.) Now, PRMC moves for a determination that the settlement was entered into good faith. As framed by the complaint, Plaintiff alleges that she slipped and fell while leaving PRMC’s hospital through side door emergency exit due to the presence of water. PRMC contends that a rough approximation of Plaintiff’s total recovery is $2 million on the lower end, and it contests the extent of Plaintiff’s damage claim as being over-inflated. (Motion at pp. 7, 10.) PRMC further argues that proposed settlement is proportionate to its liability because Plaintiff is unable to show that PRMC created the alleged dangerous condition or that PRMC failed to make reasonable inspections of the property to discovery the presence of water near the side door exit. (Motion at pg. 7; Becker Decl. ¶¶ 10; NOL, Exh. B at pg. 65:4-11.) Also, it asserts that evidence currently known establishes that MPM had created the dangerous condition due to its employee’s failure to wipe away standing water and to check if water had entered the building. (Motion at pp. 8-9.) PRMC’s former employee has testified that MPM’s employee was 10-15 feet away from the subject exit while power washing the exterior surfaces of the hospital and the pavement immediately in front of the subject door was wet. (Motion at pg. 8; Beck Decl. ¶¶ 13-18; NOL, Exh. C at pp. 23:12-18, 23:22-25:9, 26:5-10, 26:21-23, 44:6-8, 62:22-63:4, 66:24-67:2, 68:5-13, 71:11-17, 71:24-72:10.)

In opposition, MPM argues that the settlement was not entered into in good faith between Plaintiff and PRMC because the proposed settlement is not proportionate to PRMC’s liability. In support of this argument, MPM asserts the following. First, as a landlord, PRMC is vicariously liable for any negligence committed by MPM. (Opposition at pp. 3-4, relying on Srithong v. Total Investment Co. (1994) 23 Cal.App.4th 721.) Second, MPM asserts that PRMC had constructive knowledge of the dangerous condition because the alleged condition was present for at least two hours prior to Plaintiff’s incident, and PRMC failed to take proper measures in correcting the condition. (Opposition at pp. 5-6.) MPM further asserts that it did not have permission to enter the hospital because it was only hired to power wash the exterior areas. (Id. at pg. 6.) MPM further suggests that, if water had entered the building through the outside, then PRMC allowed a defective threshold to persist. (Ibid.)

Second, MPM asserts that the proposed settlement is not within a reasonable range because Plaintiff’s claimed total damages amount to over $3.7 million. (Id. at pp. 8-12.)

Thus, it reasons that it would be inequitable to eliminate MPM’s right to seek contribution from PRMC, when PRMC is only settling for 19.8% of what Plaintiff could seek at trial. (Id. at pp. 11-12.) Lastly, MPM contends that the proposed settlement is not reasonable because PRMC is self-insured and could satisfy a larger judgment.

Under the circumstances, the Court finds that PRMC’s proposed settlement has been made in good faith. First, in terms of Plaintiff’s rough approximation of recovery, the Court is not beholden to rely on Plaintiff’s own claimed total damages, and the rough approximation is based on what Plaintiff would actually recover. (West v. Superior Court (1994) 27 Cal.App.4th 1625.) Here, both defendants have contested Plaintiff’s medical damages and they have jointly retained experts to rebut Plaintiff’s medical, medical billing, life care planning, and economic damages. (Motion at pg. 10; Becker Decl. ¶¶ 32-33.) Thus, Plaintiff’s claimed damages of $3.7 million is not dispositive. Rather, based on the Plaintiff’s offers to compromise, this number is more likely to be $2 million or less. (Reply, Becker Decl. ¶¶ 6-10.) Plaintiff initially made an offer to compromise to each defendant in the amount of $10 million, but by October 4, 2023, Plaintiff made a new offer to compromise to each defendant in the amount of $1,999,999.99 and indicated “that acceptance by one Defendant will result in global resolution of this case. (Id., Becker Decl. ¶¶ 6-7, Exhs. A-B.) Moreover, more recently, Plaintiff has submitted a revised offer to compromise on February 20, 2024 to MPM in the amount of $739,999.99. (Id. at ¶ 8, Exh. C.) Thus, this repeated reduction in settlement offers would suggest that there is doubt as to whether Plaintiff would actually recover all of her claimed damages.

Even if the Court equated Plaintiff’s claimed damages of $3.7 million as being her rough approximation of recovery, PRMC’s settlement of $740,000 is not inherently unreasonable. MPM attempts to argue that this proposed settlement is unreasonable because it would only be 19.8% of Plaintiff’s claimed damages. However, it has been found that a settlement equating to half of one percent of potential damages was made good faith based on facts known at the time of the settlement. (Cahill v. San Diego Gas & Elec. Co. (2011) 194 Cal. 4th 939, 968.)

Second, based on facts known at this time, the Court further finds that PRMC’s share of liability supports that the proposed settlement was made in good faith. It is true that PRMC has a nondelegable duty and is vicariously liable for any negligence conducted by MPM. (Brown v. George Pepperdine Foundation (1943) 23 Cal.2d 256, 260.) However, as a vicariously liable tortfeasor, PRMC is minimally culpable. (See Far West Financial Corp v. D & S Co. (1988) 46 Cal.3d 796, 815-816.) Furthermore, MPM fails to present sufficient evidence to show that PRMC had constructive knowledge of the dangerous condition or that PRMC failed to act. While MPM contends that water was present for nearly two hours, this is not supported by the evidence presented. For instance, based on the deposition testimony of PRMC former employee, Hansel Ignacio RN, Nurse Ignacio responded to the incident location within five minutes after the fall occurred and noticed the pavement near subject exit was wet and one of MPM’s employees power washing 10-15 feet away. (Motion at pg. 8; Beck Decl. ¶¶ 13-18; NOL, Exh. C at pp. 23:12-18, 23:22-25:9, 26:5-10, 26:21-23, 44:6-8, 62:22-63:4, 66:24-67:2, 68:5-13, 71:11-17, 71:24-72:10.) Also, PRMC submits evidence that it maintains routine inspection process. (Motion at pg. 7; Becker Decl. ¶¶ 9-10; NOL, Exh. B at pg. 65:4-11.) Thus, this evidence suggests that PRMC did not have constructive notice of the alleged dangerous condition.

Additionally, PRMC has pointed out several inconsistencies with the testimony provided by MPM’s employee who was power washing the premises on the day of the incident. (Motion at pg. 9; Becker Decl. ¶¶ 25-29; NOL, Exh. D at pp. 39:21-40:19, 55:4-8, 56:16-21, 58:8-12, 58:23-59:5.) Moreover, MPM’s theory that the subject premises’ threshold was defective is entirety based on conjecture. Considering Plaintiff’s recent offer to compromise submitted to MPM seeks $739,999.99, Plaintiff views both defendants as being proportionately liable. Thus, the size of the settlement is reasonable.

While PRMC concedes that it is self-insured and would be able to pay any likely judgment, it is recognized that the settling defendant should pay less at the time of settlement. Lastly, there is no evidence to suggest that the proposed settlement was the result of collusion, fraud or tortious conduct that was aimed at injuring the MPM’s interest. Because the relevant Tech-Bilt factor weigh in PRMC’s favor, the Court finds that the proposed settlement between Plaintiff and PRMC was entered in good faith. Consequently, MPM is barred from asserting claims for equitable comparative contribution or comparative indemnity. (Code Civ. Proc. § 877.6(c).)

Based on the foregoing, the Court grants PRMC’s motion for determination of good faith settlement. Consequently, MPM’s cross-complaint against PRMC is dismissed, and it is barred from asserting future claims against PRMC based the subject incident.