Judge: Teresa A. Beaudet, Case: 19STCV26077, Date: 2024-03-08 Tentative Ruling

Case Number: 19STCV26077    Hearing Date: March 8, 2024    Dept: 50

Superior Court of California

County of Los Angeles

Department 50

            Background

Plaintiff Savoy Community Association (“Plaintiff”) filed this action on July 26, 2019 against Defendants Perennial Engineering & Construction, Inc., dba DM Construction Services (“Perennial”), SBBC Associates Inc. dba Stonemark Construction Management, and Angelus Waterproofing & Restoration, Inc. (“Angelus”).

The Complaint alleges causes of action for (1) breach of contract, (2) breach of express warranty, (3) breach of implied warranty, (4) negligence, and (5) strict liability. Plaintiff is a nonprofit mutual benefit corporation composed of owners of condominium living units located at 100 South Alameda Street, Los Angeles California (the “Property”). (Compl., ¶ 1.) Plaintiff alleges that there are a number of deficiencies at the Property due to renovations and repairs. (Compl., ¶ 22.) Among other allegations, Plaintiff alleges that defendants negligently, carelessly, and in an unworkmanlike manner performed work, labor, and/or services on the Property such that the Property was reconstructed and repaired improperly, negligently, carelessly, and in an unworkmanlike manner. (Compl., ¶ 51.)

On February 16, 2022, Plaintiff filed an amendment to the Complaint naming Mark Beamish Waterproofing, Inc. (“Beamish”) in place of “Doe 1.”

On December 4, 2019, Angelus filed a Cross-Complaint against Moes 1-50. On February 5, 2021, Angelus filed an amendment to the Cross-Complaint naming Beamish as “Moe 3.”

On April 1, 2020, Colony Insurance Company (“Colony”) filed a Complaint in Intervention on behalf of Perennial. On May 9, 2022, Colony filed a First Amended Complaint in Intervention on behalf of Perennial.  

On July 7, 2021, Beamish filed a Cross-Complaint against Roes 1-50. On April 6, 2023, Beamish filed the operative First Amended Cross-Complaint (“FACC”) against Cross-Defendants P’Rae’s General Contractors, Inc. dba DM Construction Services, Inc., Perennial, DM Construction Service, Inc., and David Solomos. The FACC alleges causes of action for

(1) equitable indemnity, (2) comparative contribution, (3) comparative fault, (4) breach of third party beneficiary contract, and (5) express indemnity.

Beamish now moves for an order determining that “the settlement entered into between [Beamish] and [Plaintiff] was made in good faith.” Beamish also moves for an order “[b]arring any other joint tortfeasor from maintaining any present, further or future claims against Plaintiff[1] for implied indemnity, equitable indemnity, comparative indemnity and/or contribution based on comparative negligence or fault in accordance with Code of Civil Procedure § 877.6(c),” and “[d]ismissing all complaints and/or cross-complaints for equitable indemnity, implied indemnity, comparative indemnity, and/or contribution, including claims that are derivative equitable indemnity claims, against [Beamish]…” No opposition to the motion was filed.

Discussion

“[Code of Civil Procedure] Section 877.6 was enacted by the Legislature in 1980 to establish a statutory procedure for determining if a settlement by an alleged joint tortfeasor has been entered into in good faith and to provide a bar to claims of other alleged joint tortfeasors for equitable contribution or partial or comparative indemnity when good faith is shown.” ((Irm Corp. v. Carlson (1986) 179 Cal.App.3d 94, 104.)

Code of Civil Procedure section 877.6, subdivision (a)(1) provides, in relevant part, that, on noticed motion, “[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.” (Code Civ. Proc., § 877.6, subd. (a)(1).) “The party asserting the lack of good faith shall have the burden of proof on that issue.” (Code Civ. Proc., § 877.6, subd. (d).)

“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, subd. (c).) 

In Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488, 499, the California Supreme Court identified the following nonexclusive factors courts are to consider in determining if a settlement is in good faith under section 877.6: “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.”  The evaluation of whether a settlement was made in good faith is required to “be made on the basis of information available at the time of settlement.” (Ibid.) 

Significantly, when the good faith nature of a settlement is uncontested, the Court need not consider and weigh the Tech-Bilt factors. ((City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261.) “[W]hen 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.” (Ibid.)

In support of the motion, Beamish submits the declaration of its counsel. As an initial matter, Beamish’s counsel does not clearly indicate in her declaration whether Beamish and Plaintiff have entered into a settlement. Rather, Beamish’s counsel states, inter alia, that “[Beamish’s] insurance carrier will pay the policy limit of One Million dollars and Zero cents ($1,000,000.00) to [sic] in full settlement of all claims arising out of or potentially arising out of the Project and in a cost of defense decision to relieve any and all indemnity/contribution obligations,” and that “Plaintiff will dismiss its Complaint in its entirety against [Beamish] with prejudice.” (Le Decl., ¶¶ 8, 9.) It is unclear if the parties both agreed to these terms, as Beamish’s counsel does not clearly state that the parties entered into a settlement. In addition, as set forth above, Beamish does not specify who will receive the $1,000,000.00 payment. (Le Decl., ¶ 8.)

In addition, Beamish makes a number of arguments in the motion that are not supported by evidence. For instance, Beamish asserts that “[t]he parties to this settlement and their respective experts have inspected the Property and conducted extensive discovery, including numerous fact witness depositions. [Beamish] questions Plaintiff’s ability to prove negligence against [Beamish]. [Beamish] asserts that it is not responsible in any manner for any alleged defect or deficiency at the Property, and the only reason [Beamish] has agreed to settle is to terminate expeditiously and economically its involvement in this litigation and not because of any potential liability that it faces.” (Mot. at p. 7:10-15.) However, these points do not appear to be discussed in Beamish’s counsel’s declaration. 

Beamish also asserts, inter alia, that “[t]his settlement was based on nothing less than arm’s length negotiations and the desire to compromise and terminate the costs of defending the case. There is no evidence of collusion or fraud between Plaintiff and [Beamish]. As discussed above, this settlement was arrived at after participation in multiple mediations with mediator, Al Clarke, and informal settlement discussions between counsel for Plaintiff and [Beamish].” (Mot. at p. 8:9-13.) However, no evidence appears to have been provided in support of the foregoing statements.  

In light of the foregoing, the Court does not find that Beamish has demonstrated good cause for the Court to grant the instant motion. 

            Conclusion

            Based on the foregoing, Beamish’s motion for determination of good faith settlement is denied without prejudice.  

Beamish is ordered to provide notice of this ruling.

DATED:  March 8, 2024                                ________________________________

Hon. Teresa A. Beaudet

Judge, Los Angeles Superior Court