Judge Lynne M. Hobbs, Case Number: 21STCV12000, Date: 2024-01-22 Tentative Ruling

Judge: Lynne M. Hobbs, Case: 21STCV12000, Date: 2024-01-22 Tentative Ruling

Case Number: 21STCV12000 Hearing Date: January 22, 2024 Dept: 30

MARIA MARTINEZ vs OPORTUN, INC., et al.

TENTATIVE

Signage Solutions Corporation’s motion for a good faith settlement determination under CCP section 877.6 is GRANTED. Moving party to give notice.

Evidentiary Objections

Madison’s Objection No. 1 is OVERRULED, but Objections Nos. 2-4 are SUSTAINED.

Legal Standard

Code of Civil Procedure section 877.6, subdivision (a)(1), provides, in relevant part, that, on noticed motion, “[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 . . . .” “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.” (Code Civ. Proc., § 877.6, subd. (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. (Code Civ. Proc., § 877, subd. (a).)

“The party asserting the lack of good faith shall have the burden of proof on that issue.” (Code Civ. Proc., § 877.6, subd. (d).) In City of Grand View Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261, the court provided the following guidance regarding a motion for a good faith settlement determination:

This court notes that of the hundreds of motions for good faith determination presented for trial court approval each year, the overwhelming majority are unopposed and granted summarily by the trial court. At the time of filing in many cases, the moving party does not know if a contest will develop. If each motion required a full recital by declaration or affidavit setting forth a complete factual response to all of the Tech-Bilt factors, literally thousands of attorney hours would be consumed and inch-thick motions would have to be read and considered by trial courts in an exercise which would waste valuable judicial and legal time and clients’ resources. . . . That is to say, when no one objects, the barebones motion which sets forth the ground of good faith, accompanied by a declaration which sets forth a brief background of the case is sufficient.

If the good faith settlement is contested, section 877.6, subdivision (d), sets forth a workable ground rule for the hearing by placing the burden of proving the lack of good faith on the contesting party. Once there is a showing made by the settlor of the settlement, the burden of proof on the issue of good faith shifts to the nonsettlor who asserts that the settlement was not made in good faith. If contested, declarations by the nonsettlor should be filed which in many cases could require the moving party to file responsive counter-declarations to negate the lack of good faith asserted by the nonsettling contesting party. (192 Cal.App.3d 1251, 1260-1261 [citation omitted].)

In Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499, the California Supreme Court identified the following nonexclusive factors courts are to consider in determining if a settlement is in good faith under section 877.6: “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.”

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., supra, 38 Cal.3d at p. 499.) “‘[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.]” (Ibid.)

“The party asserting the lack of good faith, who has the burden of proof on that issue (§ 877.6, subd. (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.” (Id. at pp. 499-500.)

“[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. 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. [Citation.]” (TSI Seismic Tenant Space, Inc. v. Superior Court (2007) 149 Cal.App.4th 159, 166.)

Discussion

On April 9, 2019, Plaintiff was a patron at the restaurant El Rinconcito Nunez. The restaurant is located in a strip mall at 4165 Beverly Blvd., Los Angeles, California. The strip mall is owned by Defendant, 1234 Madison Avenue, LLC (“Madison”). Plaintiff claims she was seated outside at the restaurant under a sign when one of the signs fell and injured her. Both moving and opposing party state that there was a strong windstorm at the time of the incident.

Defendant Signage Solutions Corporation (“Signage”) has filed this motion for good faith settlement, and includes its attorney’s declaration, who attests to the following. Signage prepared drawings for Oportun, Inc. for the Pylon panel, with the Oportun logo on July 8, 2016. Oportun and 1234 Madison Avenue, LLC approved the drawings. Signage Solutions installed the Oportun panel in accordance with all codes and industry standards by October 7, 2016 and Oportun accepted and paid for the work. For two and a half years before the incident, Signage Solutions was never notified of any issue or problem with the panel or sign Pylon. Signage Solutions was not engaged to do continuous inspection or maintenance of the panel or sign Pylon. It could only access the sign Pylon and panel with the permission of its owners and was never requested to do so. (Crisler Decl., ¶ 5.)

Plaintiff claimed about $80,000 in medical bills on liens. She also claimed she lost a week from work which would be about $800 in lost earnings. (Id., ¶ 10.) The parties attended a mediation on October 2, 2023 before mediator Floyd Siegel, Esq. of Judicate West. At that time, Signage reached a settlement with plaintiff in the amount of $50,000.00 conditioned upon the granting of a good faith settlement. (Id., ¶ 11.) Further, there was no collusion, fraud, or tortious conduct aimed to injure the interests of nonsettling defendants as the case was resolved in a mediation supervised by a well-respected and experienced mediator at Judicate West.

The Court finds Signage submitted a sufficient declaration setting forth a brief background of the case, which is sufficient to meet its initial burden. (City of Grand View Terrace, supra, 192 Cal.App.3d at pp. 1260-1261.)

In opposition, Madison’s argument is that Signage has failed to present substantial evidence to show its settlement was a good faith settlement. However, Madison is mistaken about who bears the burden. The party asserting a lack of good faith bears the burden, not the party seeking determination of good faith settlement. It is Madison who provides no substantial evidence demonstrating that Plaintiff’s damages are more than $80,000, and that the proposed settlement does not accurately reflect Signage’s proportionate share of fault. It is uncontested that Signage designed and installed the panel, it is also uncontested that Signage installed it in accordance with all codes and industry standards. Signage was never notified of any issues with the panel for two and a half years after installation, and it was not engaged to inspect it, nor maintain it. In addition, it is undisputed that this incident occurred on Madison’s property. Further, Madison agrees that Plaintiff’s medical damages amount to $80,000.

Thus, Madison has not shown that Signage’s settlement agreement with Plaintiff for $50,000 is so far out of the ballpark in relation to its proportionate share of Plaintiff’s known damages at the time of settlement, i.e., $80,000, because the proposed settlement represents approximately 62.5% of Plaintiff’s known medical specials.

Madison further argues Signage failed to provide evidence of its financial condition and therefore the motion should be denied. However, recent authority provides no such evidence is required. (Cahill v. San Diego Gas & Electric Co. (2011) 194 Cal.App.4th 939, 968 (“As SDGE notes, in support of their section 877.6 motion, Owners did not present any evidence of their financial condition or liability insurance policy limits. However, that omission did not preclude the trial court from finding the April 2009 settlement was made in good faith. Tech–Bilt does not require settling defendants to present such evidence.” (citation omitted)).) Additionally, in light of Signage’s potential liability, the settlement amount is reasonable “without ‘discounting’ that amount based on any purported financial insolvency or insurance limitations.” (Ibid.)

The Court finds Madison failed to meet its burden to establish the settlement was not made in good faith. Thus, Signage’s motion is granted.