Judge: Lynne M. Hobbs, Case: 21STCV12722, Date: 2023-08-10 Tentative Ruling

Case Number: 21STCV12722    Hearing Date: February 8, 2024    Dept: 30

KASSANDRA NAVARRO vs CITY OF HAWAIIAN GARDENS, et al.

TENTATIVE

Plaintiff and City of Hawaiian’s motion for a good faith settlement determination under CCP section 877.6 is GRANTED. Plaintiff to give notice.

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 counterdeclarations 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

Plaintiff has filed this motion for determination of good faith settlement, and City has filed a joinder. City includes its attorney’s declaration, who attests to the following. Plaintiff’s medical specials to date are $63,7684.63. (Derias Decl., ¶ 23; Exh. W.) The parties attended mediation on December 21, 2023, before Gerald Agnew at Judicate West. (Id., ¶ 24.) At that time, City reached a settlement with plaintiff in the amount of $117,500, contingent upon a judicial determination of good faith settlement pursuant to Code of Civil Procedure sections 877(b) and 877.6. (Id., ¶¶ 25-26.; Exh. I.) The settlement reached between Plaintiff and City was negotiated at arm's length under the guidance of Mr. Agnew after 8 hours of negotiations. (Id., ¶ 25.)

Further, City argues it was not liable. Plaintiff’s friend Acosta failed to yield to oncoming traffic after stopping at the stop sign on Clarkdale Avenue, in violation of Vehicle Code section 21802(a). Acosta does not identify any dangerous conditions or potentially dangerous conditions of the roadway. Acosta was deposed and was unwavering in her testimony regarding the fact that no condition on the roadway prevented her from seeing Zaragosa’s vehicle. (Derias Decl.¶ 31; Exh. K, Acosta Depo, 38:10-13; 52:11-14.) She stated the only reason she did not see his vehicle was because he did not have his headlights on. (Id., 31:19-24; 93:15-18.)

The Court finds City 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.) The Court notes that City’s counsel states medical specials are $63,7684.63, which appears to have an extra digit in the figure. However, after reviewing Exhibit W, the Court finds the amount is around $70,000, give or take.

In opposition, Zaragosa’s argument is that City has failed to present substantial evidence to show its settlement was a good faith settlement. However, Zaragosa 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 Zaragosa who failed to provide substantial evidence demonstrating that Plaintiff’s damages are more than $70,000 and that the proposed settlement does not accurately reflect City’s proportionate share of fault. The only form of evidence Zaragosa provides to show Plaintiff’s total damages is Plaintiff’s demand from Zaragosa of $275,000. However, Zaragosa does not cite to any authority for the proposition that a settlement demand can reflect Plaintiff’s total recovery. There may be strategic reasons for making a settlement demand.

Thus, Zaragosa has not shown that City’s settlement agreement with Plaintiff for $117,500 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., around $70,000, as the settlement amount is almost double the amount of medical specials. Settlements have been upheld as being in good faith in cases with a $25,000 settlement in a $5 million case, a $30,000 settlement in a $1 million case, a $65,000 settlement in a $7 million case, and a $50,000 settlement in a $1.425 million case. (See Cahill v. San Diego Gas & Elec. Co. (2011) 194 Cal.App.4th 939, 968 [citing Bay Development, Ltd. v. Superior Court (1990) 50 Cal.3d 1012; Wysong & Miles Co. v. Western Industrial Movers (1983) 143 Cal.App.3d 278; Wilshire Ins. Co. v. Tuff Boy Holding, Inc. (2001) 86 Cal.App.4th 627].)

Zaragosa further argues City failed to provide evidence of its financial condition and insurance limits 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, the settlement amount is reasonable “without ‘discounting’ that amount based on any purported financial insolvency or insurance limitations.” (Ibid.)

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