SUPERIOR COURT OF THE STATE OF CALIFORNIA  

FOR THE COUNTY OF LOS ANGELES - CENTRAL DISTRICT 

 

 

I. Background 

Plaintiff Steven Rangel (“Plaintiff”) filed this action against Defendants Nandha Transport Inc. (“Nandha”), Terry Lee Hunsicker (“Hunsicker”), and Pan Liu Zhao (“Zhao”) for injuries arising from a motor vehicle incident.  

On November 1, 2023, Zhao filed a Notice of Settlement. Zhao concurrently filed an application for an order determining the settlement between Plaintiff and Zhao for $250,000 to be in good faith under CCP § 877.6.   

On November 17, 2023, Nandha and Hunsicker filed a motion to challenge the application for determination of good faith settlement between Plaintiff and Zhao. No other pleadings have been filed concerning the instant application, nor is there any opposition to the motion to challenge good faith settlement.   

 

“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.)   

The Tech-Bilt factors can be summarized as follows:¿ 

(1) A rough approximation of plaintiff’s total recovery and the settlor’s proportionate liability;  

(2) The amount paid in settlement;  

(3) The allocation of settlement proceeds among defendants;  

(4) A recognition that a settlor should pay less in settlement than he would if he were found liable after a trial;  

(5) The financial conditions and insurance policy limits of settling defendants; and  

(6) The existence of collusion, fraud, or tortious conduct aimed to injure the interests of the nonsettling defendants. 

A necessary corollary to the definition of good faith in Tech-Bilt is that the trial court's consideration of the settlement agreement and its relationship to the entire litigation in a contested setting must proceed upon a sufficient evidentiary basis to enable the court to consider and evaluate the various aspects of the settlement. [Citations.] Because Tech-Bilt mandates a rough approximation of the settling defendant's proportionate liability and consideration of all other defendants' proportionate liability and consideration of all other factors that might affect the fairness of the settlement as respects non-settling defendants, the affidavits, declarations or other evidence should provide the court with the facts necessary to evaluate the settlement in terms of the factors contemplated by Tech-Bilt. Without the facts, in a contested hearing, it is impossible for a court to exercise its discretion in an appropriate fashion. 

(City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1263.)   

The Court agrees that Zhao has failed to provide any substantial evidence to evaluate whether the settlement was in good faith. Furthermore, Zhao did not submit a response or opposition to Nandha’s and Hunsicker’s motion challenging the good faith of the settlement. 

 

III. Conclusion  

Based on the foregoing, Zhao’s application for good faith determination pursuant to CCP § 877.6 is denied without prejudice. Nandha’s and Hunsicker’s motion challenging the good faith of the settlement is granted.  

 

Moving party is ordered to give notice.   

 

PLEASE TAKE NOTICE: 

Dated this 25th day of January 2024