Judge: Stuart M. Rice, Case: 23STCV28267, Date: 2024-11-20 Tentative Ruling
Case Number: 23STCV28267 Hearing Date: November 20, 2024 Dept: 1
Moving Party: Plaintiff
Nor Windsor Homeowners’ Association
Responding Party: No
response filed.
Ruling: Motion for
determination of good faith settlement granted.
This is a lawsuit
brought by plaintiff Nor Windsor Homeowners Association (Plaintiff) concerning
defects at the condominium project located at 518 East Windsor Road in
Glendale, California (the Property). The
Property was developed by defendant Nor Windsor III, LLC and built by defendant
MSB Constructors, Inc., who are collectively referred to as Defendants. After a mediation, the parties reached an
agreement to settle the case for $1.9 million.
Plaintiff now moves for determination of good faith settlement pursuant
to Code Civ. Proc. § 877.6.
Legal Standards
Code of Civil Procedure section
877 provides that “[w]here a release, dismissal with or without prejudice, or a
covenant not to sue is given in good faith before verdict or judgment to” some,
but not all, joint tortfeasors or co-obligors, it “shall discharge the party to
whom it is given from all liability for any contribution to any other parties”
but it shall not discharge any other parties from liability. (Id. at subd. (a)-(b).) Section 877 does not apply to co-obligors who
have expressly agreed in writing to an apportionment of liability for losses or
claims among themselves. (Id. at
subd. (c).) Any party to the action,
including the settling party, may request or obtain a hearing to determine the
good faith nature of the proffered settlement. (Code Civ. Proc. § 877.6(a)(1)-(2).) When determining the good
faith nature of a settlement, the court may properly rely on (1) supporting and
opposing declarations, (2) other evidence received at the hearing, or (3) the
court’s “personal experience and [the guidance] of experts in the field.” (Tech-Bilt,
Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 500 (Tech-Bilt);
Code Civ. Proc. § 877.6(b).)
“The good faith provision of
section 877 mandates that the courts review agreements purportedly made under
its aegis to insure [sic] that such settlements appropriately balance
the contribution statute's dual objectives.”
(Tech-Bilt, supra, 38 Cal.3d at 494.) Those objectives are “first, equitable
sharing of costs among the parties at fault, and second, encouragement of
settlements.” (Ibid.) The factors to be considered on a motion for
determination of good faith settlement include
[1.] a rough approximation of
plaintiffs' total recovery and the settlor's proportionate liability,
[2.] the amount paid in
settlement,
[3.] the allocation of settlement
proceeds among plaintiffs, …
[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 nonsettling
defendants.
(Id. at 499.)
The evaluation of good faith must
be made based on the information available at the time of settlement. (Ibid.) “[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.” (Ibid., quoting Torres v. Union
Pacific Railroad Co. (1984) 157 Cal.App.3d 499, 509.) “The party asserting the lack of good faith
shall have the burden of proof on that issue.”
(Code Civ. Proc. § 877.6(d).) “[O]nly
when the good faith nature of a settlement is contested [is it] incumbent on
the trial court to consider and weigh the Tech-Bilt 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 (Grand Terrace).)
Discussion
Plaintiff’s motion is unopposed
and appears to encompass all parties in this litigation. Reviewing the memorandum and the declarations
of Kenneth Ralidis and Brian Kahn, the motion appears to possess the minimum
indicia of good faith required by the law.
(See Grand Terrace, supra, 192 Cal.App.3d at 1261.) Specifically, Plaintiff sets forth that the
settlement was a policy-limits demand on a burning-limits policy prior to
mediation, after investigation of the extent of the damage to the Property and
the financial condition of the developer defendant. This is a sufficient showing, and the Court
will grant the motion.
Conclusion
For the foregoing reasons, the
motion is granted. The Court will
sign Plaintiff’s proposed order.
Plaintiff to give notice.