Judge Serena R. Murillo, Case 19STCV14805 2023-03-20 Tentative Ruling

Judge: Serena R. Murillo, Case: 19STCV14805, Date: 2023-03-20 Tentative Ruling

Case Number: 19STCV14805 Hearing Date: March 20, 2023 Dept: 29

TENTATIVE

Defendant/Cross Complainant CBC Restaurant Corp.’s motion for a good faith settlement determination under CCP section 877.6 is DENIED.

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 … 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 . . . .” “A determination by the court that the settlement was made in good faith shall bar any other joint tortfeasor … 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).) 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).)

When a motion seeking a determination under CCP section 877.6 is not opposed, the burden on the moving parties to show that the settlement was made in good faith is slight. (City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261 (holding that a barebones motion including a declaration setting forth a brief background is sufficient). However, when the motion is contested, then the moving parties must make a sufficient showing in the moving papers or in the reply papers. (Id. at 1262 (holding that evidence showing a lack of good faith requires the moving party to provide evidence to negate the lack of good faith asserted by the contesting party).) CCP section 877.6(d) imposes the burden of showing that the settlement was not made in good faith on the parties opposing the application.

In order to determine whether the settlement was made in good faith under CCP section 877.6, the Court applies the following factors identified by the California Supreme Court in Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488 to determine whether the settlement amount is “in the ballpark” of the settling party’s share of liability for the injuries:

1) a rough approximation of the plaintiff's total recovery;

2) an approximation of the settling party's share of the liability;

3) recognition that a settling party should pay less in settlement than if found liable after a trial;

4) the allocation of the settlement proceeds among plaintiffs;

5) the settling party's financial condition and insurance policy limits;

6) evidence that the plaintiff and the settling party acted with an intent to make the non-settling parties pay more than their fair share (considered fraud and collusion under Tech-Bilt).

The "good faith" concept in CCP section 877.6 is a flexible principle imposing on reviewing courts the obligation to guard against the numerous ways in which the interests of nonsettling defendants may be unfairly prejudiced. (Rankin v. Curtis (1986) 183 Cal. App. 3d 939, 945.) Accordingly, under Tech-Bilt, the party asserting the lack of “good faith” may meet this burden by demonstrating that the settlement is so far "out of the ballpark" as to be inconsistent with the equitable objectives of the statute. (Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal. 3d 488, 499-500.) 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.)

The Supreme Court explained that CCP section 877.6 is designed to further two equitable policies:

1) encouragement of settlements; and

2) equitable allocation of costs among joint tortfeasors.

(Id.)

Those policies would not be served by an approach which emphasizes one to the virtual exclusion of the other. (Id.) Accordingly, a settlement will not be found in good faith unless the amount is reasonable in light of the settling tortfeasor's proportionate share of liability. (Std. Pac. of San Diego v. A. A. Baxter Corp. (1986) 176 Cal. App. 3d 577, 589.)

Discussion

CBC seeks an order finding that its settlement with Plaintiff is a good faith settlement for the purposes of CCP section 877.6. Under the settlement agreement, CBC agreed to pay $50,000 in exchange for a release. CBC disputes liability and contends the speed and inattentiveness of both Plaintiff and Defendant Mirhan, caused the Subject Incident.

1) A rough approximation of the plaintiff's total recovery

CBC has not presented any evidence as to a rough approximation of Plaintiff’s recovery.

Defendant Mirhan presents evidence that Plaintiff claims $67,238.09 in past medical expenses, which Defendant Mirhan disputes based upon amounts paid by health insurance. (Powers Decl., Exh. D, Second Supplemental Response to Form Interrogatory 6.4.) Blue Shield of California paid $22,724.62 for Plaintiff’s treatment at Cedars Sinai following the subject accident (Id., Exh. E, Plaintiff’s Cedars Sinai Itemized Account). The only remaining amounts in excess of the amounts paid by Blue Shield include a $293.00 lien for WestStar Physical Therapy for two visits, and a New Visions Medical Group, Inc. bill for addiction treatment and pharmacological management for $1,750.00. (Id., Exh. D.) Based on this, Defendant Mirhan argues the disputed Howell amount for past medical expenses involved in this litigation totals $24,767.62. Plaintiff also alleges future medical treatment including physical therapy, doctors visits and left knee arthroscopic surgery, totaling $59,300.00. (Id., Exh. F, pgs. 7-8.) As such, it appears the approximation of Plaintiff’s total recovery for special damages alone is in the range of $126,538.09 to $84,067.62. However, this amount does not include Plaintiff’s potential award of general damages, which could be up to double or triple that amount. As such, CBC’s settlement amount of $50,000 is only a mere fraction of the approximation of Plaintiff’s total recovery.

2) An approximation of the settling party's share of the liability and the Amount Paid in Settlement

Defendant CBC has not analyzed its share of the liability. However, in opposition, Defendant Mirhan contends that Defendant CBC’s vehicle was parked illegally in the curb lane, or lane number three on La Cienega before the intersection with Beverly Boulevard. Both Plaintiff and Defendant Mirhan were planning to turn right onto Beverly Boulevard and attempted to get into the curb lane when the subject accident occurred. (Powers Decl., Exh. A, Stone Depo., 21:19-22:1; Exh., Mirhan Depo., 28:19-21). Plaintiff alleges he had passed CBC’s parked vehicle seconds before moving to the right side of the curb lane and impacting Defendant Mirhan’s vehicle. (Id., Stone Depo., 34:3-16; 38:3-18). Defendant Mirhan waited to pass the parked vehicle before moving into the curb lane. (Id., Mirhan Depo., 28:15-18). Mirhan argues that all of the movement leading up to the accident by Plaintiff and Defendant Mirhan were dictated by the presence of the illegally parked CBC truck. An independent witness that was standing on the east curb of La Cienega Boulevard, who witnessed the events leading up to the accident, describe Plaintiff going around the illegally parked red truck, then slipping between the CBC truck and Defendant Mirhan’s vehicle when the subject accident occurred. (Id., Exh. C, Driscoll Depo., 27:16-18; 29:7-21). Thus, Mirhan contends that Defendant CBC is a tortfeasor and contributed to the subject accident.

The Court finds that a jury could well find CBC’s parked vehicle was the cause of Plaintiff’s injuries, and thus, that CBC is a joint tort feasor.

3) Recognition that a settling party should pay less in settlement than if found liable after a trial

CBC is offering to pay an amount before trial and it should pay less than a potential verdict, if the matter proceeded to trial and the jury found in favor of the Plaintiff.

4) The allocation of the settlement proceeds among plaintiffs

This factor is not applicable.

5) The settling party's financial condition and insurance policy limits

CBC has not offered any evidence or argument as to this factor.

However, Defendant Mirhan contends, without submitting any evidence, that Defendant CBC has a $1,000,000.00 Commercial Policy that was in effect at the time of the subject accident.

6) Evidence that the plaintiff and the settling party acted with an intent to make the non-settling parties pay more than their fair share (considered fraud and collusion under Tech-Bilt).

CBC avers that this settlement was reached at arms-length negotiations between counsel. (Edun Decl., ¶ 11.)

Overall, CBC has not shown a rough approximation of Plaintiff’s total recovery and that its settlement of $50,000 is an approximate share of its liability for Plaintiff’s injuries as Mirhan has submitted sufficient evidence to show that a jury could find that Defendant CBC’s parked vehicle was the cause of Plaintiff’s injuries, or at the least, find that CBC is a joint tort-feasor, and that Plaintiff’s special damages alone range from $126,538.09 to $84,067.62. As such, the $50,000, which would only account for a fraction of Plaintiff’s total recovery, is not proportionate to its potential liability in this matter. Moreover, CBC has not provided any evidence regarding its financial condition or its insurance policy limits. While Mirhan contends that CBC has a $1,00,000 commercial policy, Mirhan has not submitted any evidence of this, and the Court will disregard it.

As a result, CBC has not shown that its settlement is a good faith settlement for the purposes of CCP section 877.6.

Conclusion

Based on the foregoing, Defendant CBC has not met its burden of demonstrating that it is entitled to a finding that its settlement is a good faith settlement under CCP section 877.6. Therefore, the motion for a good faith settlement determination is DENIED.

Moving party is ordered to give notice.