Judge: Monica Bachner, Case: 19STCV45587, Date: 2023-04-18 Tentative Ruling

Department 71: Attorneys who elect to submit on these published tentative rulings, without making an appearance at the hearing, may so notify the Court by communicating this to the Department's staff at (213) 830-0771 before the set hearing time.  See, e.g., CRC Rule 324(b).   All parties are otherwise encouraged to appear by Court Call for all matters.

Case Number: 19STCV45587    Hearing Date: April 18, 2023    Dept: 71

Superior Court of California

County of Los Angeles

DEPARTMENT 71

TENTATIVE RULING

Plaintiff LSG Las Tunas LP’s, and Settling Defendants A&R Corporation, Inc.’s, Ali R. Fadavi’s, Reba Aghchay’s, BME Builders, Inc.’s, Coast Supply Company’s, Dana Electric and Associates, Inc.’s, Fullerton Pacific Interiors, Inc.’s, Gavina Plumbing’s, Cabinet Solutions’, R&R Demo & Grading’s, Saddleback Roofing, Inc.’s, Santa Ana Creek Development Company dba Mark Company’s, Savin Enterprises, Inc.’s, Schindler Elevator Corporation’s, Sierra West Finish, Inc.’s, and Tinco Sheet Metal’s unopposed motion for determination of good faith settlement is granted.

Plaintiff LSG Las Tunas LP (“LSG”) (“Plaintiff”) and Settling Defendants A&R Corporation, Inc. (“A&R”), Ali R. Fadavi (“AF”), Reba Aghchay (“RB”), BME Builders, Inc., Coast Supply Company, Dana Electric and Associates, Inc., Fullerton Pacific Interiors, Inc., Gavina Plumbing, Cabinet Solutions, R&R Demo & Grading, Saddleback Roofing, Inc., Santa Ana Creek Development Company dba Mark Company, Savin Enterprises, Inc., Schindler Elevator Corporation, Sierra West Finish, Inc., and Tinco Sheet Metal (collectively, “Enrolled Subcontractors”) (collectively, “Settling Defendants”) move for an order determining their settlement was made in good faith and to dismiss and bar all claims for partial or comparative indemnity and/or contribution against the settling parties by the unsettled parties.  (Notice of Motion, pg. 1; C.C.P. §877.6(a)(1).) 

On December 19, 2019, Plaintiff filed the instant action against Defendant A&R arising from Defendant A&R’s alleged breach of a contract the Plaintiff to provide construction services to improve real property located at 704-712 Las Tunas Dr., San Gabriel, California.  (Complaint ¶4.)  On April 10, 2020, Plaintiff filed its first amended complaint (“FAC”), adding Defendants RB, Fullerton Pacific Interiors, Inc., and Dana Electric and Associates.  (See FAC.)  On February 10, 2022, Plaintiff filed the operative second amended complaint (“SAC”) adding Defendants the Western Surety Company, AF, ANR Construction, Inc., Coast Class Co., Inc., Horizon Window Care, Savin Enterprises, Inc., and Ply Gem Pacific Windows.  (See SAC.)  Plaintiff’s SAC alleges causes of action for (1) breach of contract; (2) negligence (3) breach of implied warranty; (4) indemnity; (5) fraud by deceit and omission; (6) legal malpractice; (7) disgorgement; (8) breach of the implied warranty of fitness; (9) fraudulent conveyance; and (10) negligent misrepresentation.  On January 13, 2022, this Court approved the appointment of mediator Robert Mann (“Mann”) and set mediation for June and July 2022.  (1/13/22 Case Management Order.)  On February 27, 2023, Mediator Mann partially resolved most of the claims in this action with most of the parties via a settlement stipulation and mutual release of claims.  (Decl. of Marking ¶2, Exh. 1 [“Stipulated Settlement”].)

Plaintiff and Settling Defendants filed the instant motion for determination of good faith settlement on March 7, 2023.  As of the date of this hearing, oppositions to the motion have not been filed by any of the remaining Defendants.

“[O]nly when the good faith nature of a settlement is disputed, it is incumbent upon the trial court to consider and weigh the [Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499-500] factors. 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.”  (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261.)  In light of the non-opposition to the motion, the Court need not consider and weigh the Tech-Bilt factors.

Plaintiff and Settling Defendants’ motion sets forth the background of the case and the grounds for good faith.  Plaintiff and Settling Defendants also provided the Declaration of John R. Marking, which provides a copy of the Stipulated Settlement between the parties.  (Decl. of Marking ¶2, Exh. 1.)  Plaintiff and Settling Defendants assert the Stipulated Settlement’s requirement that AmTrust, the Owner Controlled Insurance Policy (“OCIP”), pay Plaintiff $4,000,000.00 to resolve all claims against Defendants A&R, AF, RB, and the Enrolled Subcontractors, and Plaintiff’s payment for $200,000.00 to Defendant A&R to resolve Defendant A&R to resolve its affirmative claims against Plaintiff arising from Plaintiff’s termination of Defendant A&R is appropriate to the claims and circumstance of the case, is entered in good faith considering the limits of the settling parties’ financial conditions and limits of applicable insurance policies, is not based on collusion or fraud, and is not any way intended to injure the interests of the non-settling Defendants.  (Motion, pg. 4.)  Plaintiff and Settling Defendants assert that Defendant A&R and Enrolled Subcontractors are covered by a $5 million burning limits OCIP that has been substantially depleted by defense fees over the past few years and given the wasting limits and likelihood that protected discovery and trial would substantially reduce the available insurance proceeds, the settling parties agreed to compromise their claims.  (Motion, pg. 4.)  Plaintiff and Settling Defendants assert that upon payment of funds to Plaintiff and Defendant A&R, Plaintiff’s SAC, for the most part, and Defendant A&R’s amended cross-complaint, as well as those of any Enrolled Subcontractors, will be dismissed, with prejudice.  (Motion, pg. 4.)  Plaintiff and Settling Defendants assert that there are a few non-settling Defendants who are not enrolled in the OCIP, not covered by the Stipulated Settlement, and will remain Defendants in Plaintiff’s SAC, and thus it is necessary to determine the good faith of the Stipulated Settlement to extricate the joint tortfeasor defendants and cross-defendants from this case.  (Motion, pg. 4.) Plaintiff and Settling Defendants assert other factors weigh in favor of finding the settlement was made in good faith, including the large number of parties in the case and the disputed defect claims, coverage available for the claims, and the mediation efforts.  (Motion, pg. 4.)  Accordingly, Plaintiff and Settling Defendants sufficiently established the settlement was entered into in good faith.

Plaintiff and Settling Defendants’ unopposed motion for determination of good faith settlement is granted.   Plaintiff and Settling Defendants are ordered to file a proposed order within 10 days.

Dated: April _____, 2023

Hon. Daniel M. Crowley

Judge of the Superior Court