SUPERIOR COURT OF CALIFORNIA

COUNTY OF SANTA CLARA

AXIS HOMEOWNERS ASSOCIATION, a California nonprofit mutual benefit corporation

Plaintiff,

vs.

ALMADEN TOWER VENTURE, LLC, a California limited liability company; and DOES 1 to 100, inclusive,

Defendants.

Case No. 17CV314037

TENTATIVE RULING RE: MOTION FOR GOOD FAITH SETTLEMENT; MOTION OPPOSING GOOD FAITH SETTLEMENT

The above-entitled action comes on for hearing before the Honorable Patricia M. Lucas on February 14, 2020 at 9:00 a.m. in Department 3. The Court now issues its tentative ruling as follows:

I. INTRODUCTION
II.
This is a construction defect action involving a condominium development. The Second Amended Complaint, filed on April 4, 2018, sets forth the following causes of action: (1) Breach of Express Warranties; (2) Breach of Implied Warranties; (3) Violation of Statute (Civil Code, § 896, et seq.); and Breach of Declaration of Covenants, Conditions, and Restrictions.

Cross-defendant BrassCraft Manufacturing Company (“BMC”) has reached a settlement with plaintiff Axis Homeowners Association (“Plaintiff”). BMC now moves for a determination of good faith settlement.

III. LEGAL STANDARD
IV.
California Code of Civil Procedure section 877.6 provides that a party to an action in which it is alleged that two or more parties are joint tortfeasors may seek a determination that a settlement was made in good faith. “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).) “The purpose of this statute is to bar claims against a settling tortfeasor and thereby promote settlement.” (Cal-Jones Properties v. Evans Pacific Corp. (1989) 216 Cal.App.3d 324, 327.)

Generally, the court looks at “whether the amount of the settlement is within the reasonable range of the settling tortfeasor’s proportional share of comparative liability for the plaintiff’s injuries.” (Tech-Bilt, Inc. v. Woodward-Clyde & Assocs. (1985) 38 Cal.3d 488, 499.)

[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.

(Tech-Bilt, Inc. v. Woodward-Clyde & Assocs., supra, 38 Cal.3d at p. 499.)

If the good faith settlement is contested, section 877.6, subdivision (d), sets forth a workable ground rule for the hearing by placing the burden of proving the lack of good faith on the contesting party. Once there is a showing made by the settlor of the settlement, the burden of proof on the issue of good faith shifts to the nonsettlor who asserts that the settlement was not made in good faith. (Fisher v. Superior Court (1980) 103 Cal.App.3d 434, 447 [163 Cal.Rptr. 47]; § 877.6, subd. (d).) If contested, declarations by the nonsettlor should be filed which in many cases could require the moving party to file responsive counterdeclarations to negate the lack of good faith asserted by the nonsettling contesting party.

(City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261-1262.)

V. DISCUSSION
VI.
BMC asserts it has entered into a settlement with Plaintiff in which BMC will supply 2,134 replacement angle stop valves. BMC contends this is reasonable and satisfies the Tech-Bilt factors. BMC states the only allegation against it is that the angle stop valves are defective, not that such defect has caused any damage. BMC disputes the allegation and denies liability, but has agreed to provide replacements for every BMC angle stop valve that was installed at Plaintiff’s condominium development. BMC argues therefore that this is within BMC’s proportionate share of liability.

Non-settling party Acco Engineered Systems, Inc. (“Acco”) has filed a motion opposing the request for good faith settlement determination. Acco argues BMC has not provided sufficient information for the Court to weigh the Tech-Bilt factors. Acco states BMC did not provide information regarding Plaintiff’s expected total recovery, the number of defective angle stop valves in the project, the cost to remove the defective valves, or the cost of the labor to install the replacement valves. Acco asserts Plaintiff is seeking to recover as damages the cost of installing the replacement valves, which is a cost BMC should bear as the defective manufacturer. Lastly, Acco states BMC has not provided information regarding its financial condition or its limits of available insurance.

Acco is essentially arguing BMC has not met its burden in moving for approval of the settlement. In opposing the determination of good faith settlement, however, Acco has the burden of proof to show the settlement was not made in good faith. (Code Civ. Proc., § 877.6, subd. (d).) This is generally done with the support of declarations (i.e. evidence). (See City of Grand Terrace v. Superior Court, supra, 192 Cal.App.3d at p. 1262 [“If contested, declarations by the nonsettlor should be filed. . .”].) Acco has filed no declarations and provided no evidence. Therefore, Acco has not met its burden to show the settlement was not made in good faith.

In its reply papers, Acco assumes—without evidence–a value of $5.00 per valve, and then an alternative but similarly unsupported $15.00 per valve, for the purpose of making a comparison with the cost of repair estimate of $425,452 provided in BMC’s opposition to Acco’s motion opposing the request for good faith settlement determination. However, since Acco does not support its assumptions with any evidence, this argument does not help it meet its burden.

Accordingly, BMC’s motion for determination of good faith settlement is GRANTED. Acco’s motion opposing the application for determination of good faith settlement is DENIED.

The Court will prepare the final order if this tentative ruling is not contested.

NOTICE: The Court does not provide court reporters for proceedings in the complex civil litigation departments. Parties may arrange for a private court reporter to provide services, but those arrangements must be consistent with the local rules and policies posted on the Court’s website.