Judge: Yolanda Orozco, Case: BC678601, Date: 2022-10-03 Tentative Ruling

Case Number: BC678601    Hearing Date: October 3, 2022    Dept: 31

PETITIONS FOR MINORS' COMPROMISE


Background

This case arises from an alleged incident where a car struck pedestrians at an intersection located next to an elementary school operated by Los Angeles Unified School District (“LAUSD”). Plaintiffs Aimee Hernandez and Isabelle Hernandez are students at the elementary school. Plaintiff Dora Moran de Vasquez is their grandmother who was walking them to school.

On October 6, 2017, Plaintiffs Aimee Hernandez by and through her guardian ad litem Claudia C. Vasquez-Moran, Isabelle Hernandez by and through her guardian ad litem Claudia C. Vasquez-Moran, and Dora Moran de Vasquez (“Plaintiffs”) filed the instant action against Defendants Annette Green (“Green”), the City of Los Angeles (“City”), the County of Los Angeles (“County”), LAUSD, and Does 1 to 50.

On September 4, 2018, the City filed a Cross-Complaint against Green, asserting causes of action for:

1)     Indemnification;

2)     Apportionment of Fault; and

3)     Declaratory Relief.

On September 24, 2018, Green filed a Cross-Complaint against the City, asserting the same causes of action.

On January 23, 2019, the Plaintiffs dismissed County without prejudice.

On June 26, 2019, the Court sustained LAUSD’s demurrer to the second and third causes of action raised in the FAC without leave to amend.

On February 13, 2020, the Court granted Green’s motion for determination of good faith settlement as the Plaintiffs. On the same day, the Court granted City’s motion for summary judgment as to the FAC.

On March 10, 2020, judgment was entered in favor of the City.

On June 20, 2022, Petitioner Claudia C. Vasquez-Moran (“Petitioner”) filed the instant petition (“Petition”) to approve a minor’s compromise as to Claimant Aimee Hernandez (“Claimant”). The hearing was continued to allow Petitioner to address and correct the deficiencies noted in the Petition. (Min. Or. 07/22/22.)

An amended petition for Approval of Compromise, with respect to Aimee Hernandez, was filed on August 31, 2022.

On June 23, 2022, Petitioner Claudia C. Vasquez-Moran (“Petitioner”) filed the instant petition (“Petition”) to approve a minor’s compromise as to Claimant Aimee Hernandez (“Claimant”). The hearing was continued to allow Petitioner to address and correct the deficiencies noted in the Petition. (Min. Or. 07/28/22.) 

An amended petition for Approval of Compromise, with respect to Aimee Hernandez, was filed on September 09, 2022. 

Legal Standard 

Court approval is required for all settlements of a minor’s claim. (Prob. Code §§ 3500, 3600, et seq.; CCP § 372.) “‘[W]ithout trial court approval of the proposed compromise of the ward’s claim, the settlement cannot be valid.  [Citation.] [¶] Nor is the settlement binding [on the minor] until it is endorsed by the trial court.’” (Pearson v. Superior Court (2012) 202 Cal.App.4th 1333, 1338.) A minor, like Claimant, “shall appear either by a guardian or conservator of the estate or by a guardian ad litem appointed by the court in which the action or proceeding is pending, or by a judge thereof, in each case.” (Code Civ. Proc., § 372, subd. (a)(1).) Alternatively, the petitioner may file a declaration demonstrating that he or she has a right to compromise the minor’s claim under Cal. Probate Code section 3500.  

Regarding the substance of the Petition, to obtain court approval of the settlement of a minor’s claims, the petitioner must file a complete and “verified petition for approval of the settlement and must disclose ‘all information that has any bearing upon the reasonableness of the compromise.’ [Citations.]” (Barnes v. Western Heritage Ins. Co. (2013) 217 Cal.App.4th 249, 256; Cal. Rules of Court, rule 7.950. [underlining added.].)

To recover attorney’s fees California Rules of Court, 7.955, subdivision (a), requires the Court to use a reasonable fee standard when approving and allowing the amount of attorney's fees payable from money or property paid or to be paid for the benefit of a minor, unless the Court approved the fee arrangement in advance. The Court must consider the terms of any representation agreement made between the attorney and the representative of the minor and must evaluate the agreement based on the facts and circumstances existing at the time the agreement was made.  Further, section 7.955, subdivision (c), requires the attorney to submit a declaration that addresses the following non-exclusive factors: 

1. The fact that a minor or person with a disability is involved and the circumstances of that minor or person with a disability. 

2. The amount of the fee in proportion to the value of the services performed. 

3. The novelty and difficulty of the questions involved and the skill required to perform the legal services properly. 

4. The amount involved and results obtained. 

5. The time limitations or constraints imposed by the representative of the minor or person with a disability or by the circumstances. 

6. The nature and length of the professional relationship between the attorney and the representative of the minor or person with a disability. 

7. The experience, reputation, and ability of the attorney or attorneys performing the legal services. 

8. The time and labor required. 

9. The informed consent of the representative of the minor or person with a disability to the fee. 

10. The relative sophistication of the attorney and the representative of the minor or person with a disability. 

11. The likelihood, if apparent to the representative of the minor or person with a disability when the representation agreement was made, that the attorney's acceptance of the particular employment would preclude other employment. 

12. Whether the fee is fixed, hourly, or contingent. 

13. If the fee is contingent: 

a. The risk of loss borne by the attorney; 

b. The amount of costs advanced by the attorney; and 

c. The delay in payment of fees and reimbursement of costs paid by the attorney. 

14. Statutory requirements for representation agreements applicable to particular cases or claims.   

Discussion 

I. Compromise of Aimee Hernandez

Petitioner has submitted an amended Petition for Approval of Minor’s Comprise for minor Aimee Hernandez. The previous Petition was denied due to the following deficiencies:

First, the proposed Order approving the petition was not lodged with the Court (MC-351).

Second, the Petition did not include “an original or a photocopy of any doctor’s report containing a diagnosis of the claimant’s injuries or a prognosis for the claimant’s recovery, and a report of the claimant’s current condition,” which was to be attached as Attachment 8. (See MC-350 ¶ 8.)

Third, the Petition did not include proof of any medical liens or that Claimant’s medical expenses were reduced. (MC-350 ¶ 12.)

Fourth, Petitioner failed to include a copy of the of the retainer agreement as required. (See MC-350 ¶¶ 13(a), 17.)

Fifth, the Plaintiffs’ counsel’s declaration in support of the 42% contingency fee did not sufficiently explain why the fees were reasonable. (See CRC rule 7.955.)

The Court now finds:

First, the Proposed Order (MC-351) and the Order to Deposit Money into a Blocked Account (MC-355) have been lodged with the Court. The total amount authorized to be deposited is $69,210.93.

Second, the Petitioner included a photocopy of Aimee Hernandez’s doctors’ report. Aimee Hernandez continues to experience pain in her left shoulder and right arm. After she was discharged, she was given ibuprofen.  Aimee Hernandez’s doctor’s note reveals that Aimee Hernandez experiences no pain in the shoulder or wrist as of August 30, 2017, but continued to suffer “issues.” However, on December 9, 2020, Dr. Steve M. Meir diagnosed Aimee Hernandez with “cubital tunnel syndrome.” No Doctor’s note from Dr. Meier is attached informing the Court of the minor’s future prognosis or whether she continues to experience symptoms and is receiving treatment. (MC-350 attachment 7.)

Third, the Petitioner included proof of medical liens and medical expenses that were reduced. The amount reduced is $68,086.00 and the total medial lien amount that remains is $1,823.73.

Fourth, Petitioner has provided a copy of the retainer agreement. Per the retainer agreement, attorney’s fees are 25% before the suit is filed and 42% after the suit is filed. (MC-350 attachment 17a)

Fifth, Counsel for the minor asserts that they have reduced their fee to 35% of the minor’s recovery, totaling $35,000.00 in attorney’s fees. Counsel has also submitted a declaration addressing why attorney’s fees should be assessed at 35%.

Counsel asserts that good cause exists for a 35% contingency fee because: (1) Plaintiffs were not offered a settlement before they retained counsel, (2) time spent investigating, negotiating, and litigating the case, including taking multiple depositions, and (4) getting Defendant Annette Green to settle for her policy limit of $100,000.00. The Court is satisfied that factors outlined in California Rule of Court, Rule 7.955 (c) have been and approves the contingency fee at 35%.

The Court notes further deficiencies:

Both boxes in section 17(c) are checked.

Section 10, subsection (c), explaining the terms of the settlement, is left blank. Although the gross settlement amount for all the Plaintiffs is not stated, the following information is provided:

“Dora Moran De Vasquez’s gross settlement is $100,000.00 and Isabella Hernandez’s claim was settled for $55,000.00. Plaintiffs’ counsel is seeking $42,000.00 in attorney’s fees from Dora Moran De Vasquez’s claim and $19,250.00 from Isabella Hernandez’s claim.”

Petitioner is also required to include Attachment 11b (6) explaining the reasons for the apportionment of the settlement payment between the parties.  

II. Compromise of Isabella Hernandez

Petitioner has submitted an amended Petition for Approval of Minor’s Comprise for minor Aimee Hernandez. The previous Petition was denied due to the following deficiencies:

First, Petitioner has failed to comply with Section 8 of the Petition, by failing to include Attachment 8 “[a]n original or a photocopy of any doctor’s report containing a diagnosis of the claimant’s injuries or a prognosis for the claimant’s recovery, and a report of the claimant’s current condition”. (MC-350, Section 8.)

Second, Petitioner has failed to comply with Section 10c. of the Petition, by failing to describe the “[t]erms of the settlement” entered between Claimant Hernandez and Defendant Annette Green. (MC-350 Section 10c.)

Third, while Petitioner states Defendant Annette Green has additionally settled with the two (2) other Plaintiffs in this action, Petitioner has failed to comply with Section 11b.(6) of the Petition, by failing to include Attachment 11b.(6) the “[r]easons for the apportionment of the settlement payments between the claimant and each other plaintiff or claimant named above”. (MC-350 section 11b.(6).)

Fourth, while Petitioner represents “[n]o reimbursement is requested by the” Non-ERISA insured medical plan which paid Claimant Hernandez’s medical expenses, Petitioner fails to provide any proof thereof. (MC-350 Sections 12a.(3), 12b.(2)(f)(i).).)

Fifth, Petitioner has failed to comply with Section 13a. of the Petition, by failing to include Attachment 17a “a copy of any written attorney fee agreement”. (MC-350 Section 13a.)

Lastly, the Plaintiffs’ counsel’s declaration in support of the 42% contingency fee did not sufficiently explain why the fees were reasonable. (See CRC rule 7.955.)

The Court now finds:

First, although Petitioner included a photocopy of the discharge documents, Petitioner also asserts that the minor continues to suffer from emotional and mental distress related to the accident. (MC-350 attachment 7.) There is no doctor’s report assessing the minor’s current condition or prognosis of her recovery and if the minor requires further treatment. (MC-350 section 8.)

Second, Petitioner explains the terms of the settlement and represents that the minor’s claims are settled for $55,000.00.

Third, in attachment 11(b)(6), Petitioner explains that Defendant Annette Green had a policy limit of $100,000.00 per person and $300,000.00 per incident. Defendant Green settled for $100,000.00 of the policy limit with Aimee Hernandez and Dora Moran de Vasquez each. However, because Aimee Hernandez was injured the least and her only treatment was the initial hospital visit, Defendant refused to settle for the full policy limit and only accepted a settlement of $55,000.00 for minor Isabella Hernandez. (MC-35- attachment 11(b)(6).)

Fourth, Petitioner includes a copy of a letter from the healthcare provider representing that subrogation or right of reimbursement will not be pursued. (MC-35 attachment 12b(5).)

Fifth, Petitioner includes a copy of the written attorney fee agreement. (MC-350 attachment 17a). Per the retainer agreement, attorney’s fees are 25% before the suit is filed and 42% after the suit is filed.

Lastly, Counsel has also submitted a declaration addressing why attorney’s fees should be assessed at 35%. (MC-350 13a.) Counsel asserts that the fee has been reduced from 42% to 35% after this Court assess that that fee was too high. This Court did not state that the 42% contingency fee was too high, only that Petitioner’s counsel’s declaration was insufficient to support an attorney’s fee request of 42%. (See Min. Or. 07/28/22.)

Counsel asserts that good cause exists for a 35% contingency fee because: (1) Plaintiffs were not offered a settlement before they retained counsel, (2) time spent investigating, negotiating, and litigating the case, including taking multiple depositions, and (4) getting Defendant Annette Green to settle for minor’s claim for $55,000.00. The Court is satisfied that factors outlined in California Rule of Court, Rule 7.955 (c) have been and approves the contingency fee at 35%. 

The Court also notes one other deficiency, both boxes in section 17(c) are checked.

Conclusion 

Petitioner’s Amended Petitions to Confirm Minor's Compromise of Aimee Hernandez and Isabella Hernandez remain with a few open issues. The Court will discuss with counsel the best way to address these.