Judge Stephen Morgan, Case Number: 22AVCV01098, Date: 2023-09-26 Tentative Ruling

This is a is a personal injury action stemming from a motor vehicle incident. Plaintiffs Nisha Norberg (“Norberg”) and Gaige Woolfield, a minor by and through his Guardian ad Litem, Amberlynn Peterson (“Woolfield” and collectively “Plaintiffs”) allege that on November 13, 2021, Norberg was driving her vehicle, with Woolfield in a rear child restraint seat, northbound on Avenue G, approaching the intersection of Avenue G and 30th Street East in Lancaster, CA when a vehicle pulled directly into her path of travel when as she entered the intersection, causing an accident. Plaintiffs present that all parties to the accident agree that there was a visibility issue due to poor lighting at the intersection and the poor lighting was known by Defendants County of Los Angeles (“COLA”) and City of Lancaster (“Lancaster”) know of said issue prior to the incident.

On December 30, 2022, Plaintiffs filed their Complaint alleging two causes of action for: (1) Premises liability[1], and (2) General Negligence.

On February 14, 2023, COLA filed its Answer and a Cross-Complaint, naming Alexander de Leon Giron (“Giron”) as Cross-Defendant.

On July 18, 2023, Giron filed an Application for Determination of Good Faith Settlement.

On August 17, 2023, COLA filed this Motion Contesting Application by Alexander De Leon Giron for Determination of Good Faith Settlement (“Motion to Contest Good Faith Settlement”).

On August 18, 2023, COLA filed an Ex Parte Application for an order permitting County to late file the Notice of Motion and Motion Contesting Giron’s Application for Determination of Good Faith Settlement, granted on August 21, 2023.

No Opposition has been filed to Motion to Contest Good Faith Settlement. Regarding motions contesting the good faith of the settlement, “the notice by a nonsettling party shall be given in the manner provided in subdivision (b) of Section 1005.” (SeeCal. Code Civ. Proc. § 877.6(a)(2) [excluding settlements in which a confidentiality agreement has been entered into regarding the case or the terms of the settlement].) Cal. Code Civ. Proc. § 1005(b) provides: “All papers opposing a motion so noticed shall be filed with the court and a copy served on each party at least nine court days. . .before the hearing.” “Section 1013, which extends the time within which a right may be exercised or an act may be done, does not apply to a notice of motion, papers opposing a motion, or reply papers governed by this section.” (Ibid.) The hearing is set for September 26, 2023. Accordingly, an Opposition was due by September 12, 2023, accounting for the holiday on September 22, 2023. Should an Opposition be filed, it is now untimely.

On September 26, 2023, the Court held a hearing on the matter. The Court inquired as to why Plaintiff’s counsel, , Kenneth King (“King”), (1) filed the Minor’s Compromise in a separate probate case and (2) neither filed a notice of related case nor informed the Court that there was a determination of good faith settlement related to the Minor’s Compromise that remained pending. King conceded that a notice of related case should have been filed. Counsel for Giron, Varduhi Rose Petrosyan (“Petrosyan”), presented that no response was filed because she was “out of the country.” The Court continued the matter to allow for additional briefing.

Legal Standard for Good Faith Settlement– Under Cal. Code of Civ. Proc. §877.6, “[a]ny¿party to an action in which 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 or other claimant and one or more alleged tortfeasors or co-obligors.”¿ (Cal. Code Civ. Proc.§ 877.6(a)(1).)¿ Alternatively, “a settling party may give notice of settlement to all parties and to the court, together with an application for determination of good faith settlement and a proposed order.” (Cal. Code Civ. Proc. §877.6(a)(2).) Such an application shall include “the settling parties, and the basis, terms, and amount of the settlement” and “[t]he notice, application, and proposed order shall be given by certified mail, return receipt requested, or by personal service.” (Id.) “The issue of the good faith of a settlement may be determined by the court on the basis of affidavits served with the notice of hearing, and any¿counter-affidavits¿filed in response, or the court may, in its discretion, receive other evidence at the hearing.” (Cal. Code Civ. Proc.§ 877.6(b).)¿ “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(c).)¿¿The party asserting the lack of good faith shall have the burden of proof on that issue.¿¿(Code Civ. Proc.§ 877.6(d).)¿¿¿

The courts consider the so-called¿Tech-Bilt¿factors when determining whether a settlement is made in good faith:¿

“[T]he 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.¿[citations omitted]¿Finally, practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement. . . . 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.”¿

(Tech-Bilt, Inc. v. Woodward-Clyde & Associates¿(1985) 38 Cal.3d 488, 499–500 (“Tech-Bilt”). See also¿id.¿at¿499 [“a disproportionately low settlement figure is often reasonable in the case of a relatively insolvent, and uninsured, or underinsured, joint tortfeasor”].)¿¿¿

Application – COLA seeks the Court deny Cross-Defendant’s Application of Good Faith Settlement on the basis that Tech-Bilt factors are not met due to his degree of culpability and/or responsibility for the accident and resulting injuries.

· a rough approximation of plaintiffs' total recovery and the settlor's proportionate liability,

· a recognition that a settlor should pay less in settlement than he would if he were found liable after a trial,

· the as the existence of collusion, fraud, or tortious conduct aimed to injure the interests of¿nonsettling¿defendants, and

· practical considerations obviously require that the evaluation be made on the basis of information available at the time of settlement.

COLA argues that Giron has not made any showing that the settlement was within the good faith range as it states that (1) a settlement was reached for a $30,000, and (2) states that the $30,000 settlement is “not grossly disproportionate to what a reasonable person at the time of the settlement would estimate Giron’s exposure to be.” (See Application for Good Faith Settlement 6:9-10.) COLA emphasizes that no analysis has been done under Tech-Bilt.

COLA next argues that the settlement amount of $30,000.00 is not within the good faith ballpark. Specifically, COLA directs the Court to the presentation of damages set forth in Plaintiffs’ government claim and presents that the $30,000.00 is only a fraction of Plaintiffs’ estimated injuries, leading to a disproportionate amount as to what a reasonable person at the time of settlement would estimate Giron’s exposure to be.

For clarity, the Court notes that this is an action in which it is alleged two are more parties are joint tortfeasors due to COLA’s cross-complaint.

Here, the Court has been provided with the following information on the settlements:

The Court notes that Plaintiffs had filed a separate probate case, 23AVPB00135, for a Minor’s Compromise between Giron and Woolfield, set for hearing on June 15, 2023, approximately three months prior to the determination of good faith settlement. Counsel for Plaintiffs in both cases, King, neither filed a notice of related case nor informed the Court that there was a determination of good faith settlement related to the Minor’s Compromise that remained pending. As such, the Court vacated its order related to the Minor’s Compromise in 23AVPB00135. (See 23AVPB00135 09/19/2023 Order.)

King attempts to use 23AVPB00135 as a justification for the determination that a settlement was made in good faith. Specifically, King couches the description of the probate case in language suggesting that the Minor’s Compromise has been approved and would have to be undone. Such language does not reflect King’s actions, of which the Court inquired, and that the Court has already vacated the Minor’s Compromise. The Court notes that such a presentation may constitute a misrepresentation of the procedural background of the case. The Court emphasizes that current Rules of Professional Conduct requires candor to the tribunal. (See California State Bar, Rules of Professional Conduct, Rule 3.3. Candor Toward the Tribunal.) King’s presentation, while not exactly a false statement, omits key facts surrounding the Minor’s Compromise and the Court’s reasoning behind its decisions. The Court does not look fondly upon such actions.

Accordingly, discussion of 23AVPB00135 as support for the Application for Good Faith Settlement is now moot.

i. Rough Approximation of Plaintiffs' Total Recovery and the Settlors' Proportionate Liability

The first Tech-Bilt factor consists of two parts — a rough approximation of Plaintiffs' total recovery and the settlors' proportionate liability. When approximating a plaintiff's total recovery or the settling defendant's proportionate liability, “judges should . . . not yearn for the unreal goal of mathematical certainty. Because the application of section 877.6 requires an educated guess as to what may occur should the case go to trial, all that can be expected is an estimate, not a definitive conclusion.” (North County Contractor's Assn. v. Touchstone Ins. Services (1994) 27 Cal.App.4th 1085, 1090 (“North County”).)

Additionally, “a court not only looks at the alleged tortfeasor's 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.)

Here, the Court need not make an educated guess as to actual damages. COLA has provided the government claims filed by King on behalf of Plaintiffs. They show that Woolfield has actual damages of $250,000.00 (Decl. Erik Pogosyan, Exh. A) and Norberg has actual damages of $500,000.000 (id., Exh. B.) The Court notes that both claims state that the total estimated prospective damages for each Plaintiff to be $1,500,000.00; however, this is not an accurate reflection of plaintiff’s total recovery. (See Id., Exhs. A and B.) At the minimum, based on Plaintiffs’ own claims, Plaintiffs’ recovery will be over $750,000.00.

The case also arises, as presented by the allegations, due to Giron pulling directly into Plaintiffs’ path of travel. (See Complaint, Premises Liability and General Negligence attachments.) Both Plaintiffs and Giron believe that some culpability was due to lighting issues at the intersection. (See ibid.)

While Plaintiffs did not sue Giron as a defendant, COLA has alleged Implied Indemnity, Contribution, and Declaratory Relief against Giron, including a prayer of relief for (1) total and complete indemnity for any judgments rendered against COLA; (2) judgment in proportionate share to COLA and Giron; and (3) a judicial determination that Giron was the legal cause of Plaintiffs’ injuries and indemnification of COLA, partially or in whole. (See Cross-Complaint [generally].)

Good faith is not affected by the fact the parties did not have access to all the evidence ultimately offered at trial on the disputed issues. (Toyota Motor Sales U.S.A., Inc. v. Sup.Ct. (Lee) (1990) 220 Cal.3d 864, 878.) However, there must be some evidence to support the determination and it is an abuse of discretion to find good faith based on a critical assumption as to the settling defendant's liability for which there is no evidence at all. (Id. at pp. 877-878.) Here, Plaintiffs have conceded in their Complaint that Giron pulled into their path of travel leading to the accident, though lighting was also at issue. (See Complaint, Premises Liability and General Negligence attachments.)

Accordingly, the Court finds that this factor does not support a determination of good faith.

“[A] defendant's settlement figure must not be grossly disproportionate to what a reasonable person, at the time of the settlement, would estimate the defendant's liability to be.' [Citation.]” (Tech-Bilt, supra, 38 Cal.3d at p. 499.) However, even though “an offer of settlement must bear some relationship to one’s proportionate liability, bad faith is not ‘established by a showing that a settling defendant paid less than his theoretical proportionate or fair share.’ [Citation.]" (North County, supra, 27 Cal.App.4th at p.1090.) “Such a rule would unduly discourage settlements” and “convert the pretrial settlement approval procedure into a full-scale mini-trial.” (Tech-Bilt, supra, 38 Cal.3d at p. 499.) Rather, in order to meet the proportionality requirement, “all that is necessary is that there be a ‘rough approximation’ between a settling tortfeasor's offer of settlement and his proportionate liability. [Citation.]” (North County, supra, 27 Cal.App.4th at pp. 1090-1091.) In determining whether the settling defendant's settlement figure is “within the ballpark” of his fair share of liability, the Court may rely on “the judge's personal experience” and the experience of “experts in the field.” (Tech-Bilt, supra, 38 Cal.3d at p. 500.)

Giron’s application states only that, “[t]he settlement figure of $15,000 for each Plaintiff, total $30,000, is not grossly disproportionate to what a reasonable person at the time of the settlement would estimate GIRON’s exposure to be. The amount is a fair and reasonable consideration for the compromise, release and waiver of the claims of Plaintiffs, as GIRON had no excess liability insurance nor was he in the course and scope of employment at the time of the accident.” (Application for Good Faith Settlement 6:9-14.) Giron also emphasizes that Plaintiffs did not sue him; however, this does not absolve his proportionate liability as COLA has brought this issue within the Court’s purview with its Cross-Complaint.

The total amount of settlement reached between Plaintiffs and Giron is $30,000.00, with $15,000.00 going to each plaintiff. (Id. 6:9-14, Decl. Varduhi Rose Petrosyan ¶¶ 3-6.) The settlement will release Giron in full from all claims and rights stemming from this incident. (See ibid.) Section 877.6 is rooted in the concern that a piecemeal settlement may prejudice non-settling defendants if it is unreasonably low, which would expose the remaining defendants to a judgment exceeding their fair share of the liability. (Tech-Bilt, supra, 38 Cal.3d at pp. 494-497.) COLA shows that a settlement of $30,000.000 is so low as to expose it to an unfair share of liability as, using the actual damages claimed by Plaintiffs in their government claim only, it would result in at least $720,000.00 placed onto COLA.

Accordingly, the Court finds that this factor does not support a determination of good faith.

Where defendants are potentially liable for separate injuries, or a “sliding scale"” settlement is involved, the settling parties must include in their agreement a joint allocation or valuation of the amount of the offset. (Alcal Roofing & Insulation v. Superior Court (Sears) (1992) 8 Cal.App.4th 1121, 1124.)

This factor is not applicable to the case at hand. (See id. at 1124 [“In the typical one-plaintiff, multiple-defendants, personal injury action each tortfeasor is potentially liable for the same injury to the plaintiff. Therefore the full settlement by one defendant will offset a judgment against other tortfeasors; no allocation of the settlement is required.”]

iv. A Recognition that a Settlor Should Pay Less Than if Found Liable at Trial

The Court expressly recognizes that a settlor should pay less in settlement that he would if he were found liable after trial. This factor supports a determination of good faith as the settlement appears to show that Giron is paying less than if found liable at trial based on the settlement amount and the claims filed by Plaintiffs.

v. The Financial Conditions and Insurance Policy Limits of Settling Defendants

An exception to the proportionality requirement described above is that “a disproportionately low settlement figure is often reasonable” when the settling defendant is “relatively insolvent” and uninsured or underinsured. (Tech-Bilt, supra, 38 Cal.3d at p. 499; see Schmid v. Superior Court (1988) 205 Cal.App.3d 1244, 1245—6 [holding that “a settlement of a personal injury lawsuit is in ‘good faith[]’ . . . where a defendant pays the plaintiff the limit of the defendant's insurance policy and has no assets, even though the amount paid in settlement is far less than the likely amount of a judgement against the defendant were the case to go to trial’]; see also County of Los Angeles v. Guerrero (1989) 209 Cal.App.3d 1149, 1157—8 [finding that the settling defendant's ‘modest’ financial condition and insurance limits ‘are necessarily controlling and effectively override the other Tech-Bilt factors’].)

Here, the is no presentation that Giron is uninsured, underinsured, lacks assets, or has modest financial conditions in the Application for Good Faith Settlement. Rather, the application states only that Giron has “no excess liability insurance nor was he in the scope of employment at the time of the accident.” (Application for Good Faith Settlement 6:12-13.)

Supplemental briefing by King reveals that Giron revealed his financial situation and assets in deposition. (See Supplemental Decl. King ¶ 15.) Such testimony includes Giron’s lack of disposable income, assets, and ability to contribute anything outside of his insurance policy. (Ibid.; Id. at Exh. D [no homes other than rental property, wife helps with $400 rent, average pay of $300.00-$500.00 per day as barber and 4300.00-$350.00 per week as barber teacher, only one vehicle bought after incident, etc.].)

Supplemental briefing from Petrosyan highlights Giron’s testimony. The Court has discussed Giron’s financial situation, ante.

COLA has shown that settlement amount between Giron and Plaintiffs is disproportionately low; however, the testimony regarding Giron’s financial information weighs in favor of a good faith determination.

vi. The Existence of Collusion, Fraud, or Tortious Conduct Aimed to Injure the Interests of the Non-Settling Defendants

“Any negotiated settlement involves cooperation, but not necessarily collusion. It becomes collusive when it is aimed to injure the interests of an absent tortfeasor. Although many kinds of collusive injury are possible, the most obvious and frequent is that created by an unreasonably cheap settlement.” (River Garden Farms, Inc. v. Superior Court (1972) 26 Cal.App.3d 986, 996.) “Prevention of collusion is but a means to the end of preventing unreasonably low settlements which prejudice a nonparticipating tortfeasor. The price of a settlement is the prime badge of its good or bad faith. Construed in the light of [section 877.6's] objectives, the good faith release clause extends the obligation of good faith beyond the parties to the negotiations, embracing an absent tortfeasor.” (Ibid.)

Settling parties contend that the settlement was not entered into for any improper reason and there is no collusion, fraud or other tortious conduct. (Application for Good Faith Settlement, Decl. Varduhi Rose Petrosyan ¶ 14.) COLA has evidenced that the settlement of $30,000.00 is unreasonably low, which prejudices COLA, a nonparticipating tortfeasor. However, with the supplemental declaration, the financial status of Giron shows that this figure was determined due to Giron’s relatively insolvent status. Thus, this factor supports a good faith determination.

Thus, it appears that due to Giron’s financial situation, the low settlement figure is often reasonable. Accordingly, the Motion Contesting Application by Alexander De Leon Giron for Determination of Good Faith Settlement is DENIED.

Defendant/Cross-Complainant County of Los Angeles’ Motion Contesting Application by Alexander De Leon Giron for Determination of Good Faith Settlement is DENIED.

[1] Plaintiffs have filed a Complaint stating that the cause of actions are Motor Vehicle and General Negligence, but attaching Premises Liability and General Negligence Cause of Action attachments. As form is respected less than substance, the Court addresses the causes of actions by their attachments, which include relevant allegations. (See Cal. Civ. Code § 3528 [“The law respects form less than substance.”].)