Case Number: BC536142??? Hearing Date: May 20, 2016??? Dept: A
Li v Millenium Trucking
MOTION FOR DETERMINATION OF GOOD FAITH SETTLEMENT
Calendar: 2
Case: BC536142
Date: 5/20/16
MP: Defendants, Millennium Trucking Company, Inc. and Kin Chi Ng
RP: Defendants, Marten Transport Ltd. and Warren Brown
RELIEF REQUESTED:
Order determining that the settlements between the Plaintiff and the Defendants, Millennium Trucking Company, Inc. and Kin Chi Ng, was a good faith settlement under CCP section 877.6.
DISCUSSION :
This case arises from the Plaintiff?s claim that he suffered personal injuries in a motor vehicle accident caused by the Defendants? negligence. Trial is set for July 11, 2016.
This hearing concerns the application of the Defendants, Millennium Trucking Company, Inc. and Kin Chi Ng, for a finding that their settlement with the Plaintiff is a good faith settlement under CCP section 877.6.
CCP section 877.6 permits the Court to evaluate a settlement made between a plaintiff and a defendant when the defendant is a joint tortfeasor with other non-settling defendants. A determination that their settlement is a good faith settlement under CCP section 877.6 will bar any claims for equitable contribution or comparative indemnity.
When a motion seeking a determination under CCP section 877.6 is not opposed, the burden on the moving parties to show that the settlement was made in good faith is slight. City of Grand Terrace v. Superior Court (1987) 192 Cal.App.3d 1251, 1261 (holding that a barebones motion including a declaration setting forth a brief background is sufficient). However, when the motion is contested, then the moving parties must make a sufficient showing in the moving papers or in the reply papers. Id. at 1262 (holding that evidence showing a lack of good faith requires the moving party to provide evidence to negate the lack of good faith asserted by the contesting party). CCP section 877.6(d) imposes the burden of showing that the settlement was not made in good faith on the parties opposing the application.
The Defendants? application is opposed by Defendants, Marten Transport Ltd. and Warren Brown. Accordingly, the Defendants must make a sufficient showing to negate the assertion in the opposition papers that their settlement does not qualify as good faith settlements under CCP section 877.6.
In order to determine whether the settlements were made in good faith under CCP section 877.6, the Court applies the following factors identified by the California Supreme Court in Tech-Bilt, Inc. v. Woodward-Clyde & Associates (1985) 38 Cal.3d 488 to determine whether the settlement amount is ?in the ballpark? of the settling party?s share of liability for the injuries:
1) a rough approximation of the plaintiff’s total recovery;
2) an approximation of the settling party’s share of the liability;
3) recognition that a settling party should pay less in settlement than if found liable after
a trial;
4) the allocation of the settlement proceeds among plaintiffs;
5) the settling party’s financial condition and insurance policy limits;
6) evidence that the plaintiff and the settling party acted with an intent to make the non-settling parties pay more than their fair share (considered fraud and collusion under Tech-Bilt).
The “good faith” concept in CCP section 877.6 is a flexible principle imposing on reviewing courts the obligation to guard against the numerous ways in which the interests of non-settling defendants may be unfairly prejudiced. Rankin v. Curtis (1986) 183 Cal. App. 3d 939, 945. Accordingly, under Tech-Bilt, the party asserting the lack of ?good faith? may meet this burden by demonstrating that the settlement is so far “out of the ballpark” 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. Such a demonstration would establish that the proposed settlement was not a “settlement made in good faith” within the terms of section 877.6. Id.
The Supreme Court explained that CCP section 877.6 is designed to further two equitable policies:
1) encouragement of settlements; and
2) equitable allocation of costs among joint tortfeasors.
Id.
Those policies would be not be served by an approach which emphasizes one to the virtual exclusion of the other. Id. Accordingly, a settlement will not be found in good faith unless the amount is reasonable in light of the settling tortfeasor’s proportionate share of liability. Std. Pac. of San Diego v. A. A. Baxter Corp. (1986) 176 Cal. App. 3d 577, 589.
This cases arises from a motor vehicle accident that occurred on February 15, 2012 on the westbound Interstate 40 near Holbrook, Arizona. The accident involved three tractor-trailers. The Plaintiff, Shuhuan Li, was in the sleeper berth of a tractor trailer owned by the Defendant, Millennium Trucking Co., and driven by the Defendant, Kin Chi Ng. When another tractor-trailer was passing, Kin Chi Ng turned his vehicle to the right to avoid the passing trailer. This caused Ng?s trailer to tip over, which pulled the tractor over. Ng?s vehicle came to a rest in the middle of the Interstate. The tractor trailer owned by the Defendant, Marten Brown, and driven by Defendant, Warren Brown, then struck the underside of Ng?s tractor trailer.
The Plaintiff has entered into a settlement with the Defendants, Millennium Trucking Co. and Kin Chi Ng. The Defendants agreed to pay $959,475.77, which is the remaining amount of the Defendants? insurance policy limit of $1,000,000.
The following analyzes the motions to determine whether the Defendants have met their burden with regards to the Tech-Bilt factors.
1) A rough approximation of the plaintiff’s total recovery
The Defendant?s motion contains no evidence whatsoever identifying the Plaintiff?s total recovery or any approximation of it. There is no discussion or evidence concerning any of the Plaintiff?s claims or injuries.
The opposition papers state that the Plaintiff has alleged significant injuries to his spine, traumatic brain injury, post-trauma concussion disorder, amnesia disorder, post-traumatic stress disorder, anxiety, depression. Further, the opposition papers state that the Plaintiff has had multiple back surgeries and other medical care totaling almost $2,000,000 to date. The Defendants, Millennium Trucking Co. and Kin Chi Ng, failed to discuss any of this or to make any effort to identify a rough approximation of the Plaintiff?s total recovery.
Accordingly, these Defendants have not provided sufficient facts to identify a rough approximation of the Plaintiff?s total recovery.
2) An approximation of the settling party’s share of the liability
The Defendants, Millennium Trucking Company, Inc. and Kin Chi Ng, owned and operated the motor vehicle in which the Plaintiff was a passenger. The Defendants? motion offers no substantial evidence of an approximation of its share of liability. The accident began with the tractor trailer operated by the Defendant, Kin Chi Ng, falling over and coming to a rest in the middle of the Interstate. There are no facts to show the cause of this accident, e.g., whether the driver, Kin Chi Ng, caused the accident through the negligent operation of the motor vehicle.
Then, the tractor-trailer driven by the other Defendant, Warren Brown, struck the underside of Ng?s tractor-trailer, which was lying on its side and blocking the Interstate. At the deposition of the Craig Remos, who was the officer that prepared the crash reports for the accidents, Mr. Remos testified that Warren Brown took no improper action because he ran into a vehicle blocking the road and ?there?s not really much you can do if something?s blocking your lane? (papers filed on April 12, 2016 by Marten Transport Ltd. and Warren Brown, copy of transcript in exhibit B).
The declaration of Richard McGreevy, filed on May 9, 2016 by the Defendants, Millennium Trucking Co., and Kin Chi Ng, include a portion of the deposition of Kin Chi Ng. The portion concerns only his effort to remove the Plaintiff from the cab and testimony that other, unknown and unidentified truckers were out with flashlights directing traffic. Mr. Ng states that approximately ten minutes after his tractor-trailer had flipped over that he saw that both lanes of the Interstate had trucks in them. Presumably, one of these trucks was operated by Warren Brown; however, the deposition transcript ends.
It appears that the Defendants, Millennium Trucking Co, Inc. and Kin Chi Ng, have a substantial share of the liability, i.e., perhaps 75% and above, because Kin Chi Ng lost control of the tractor trailer he was operating such that it fell over and came to a rest on the Interstate.
As noted above, the papers of Defendants, Marten Transport Ltd. and Warren Brown, indicate that the Plaintiff?s medical bills are approximately $2,000,000. Since there is additional amounts for pain and suffering and potentially a substantial amount of future medical care due to the spinal and brain injuries, the Plaintiff?s damages could easily exceed $3,000,000. If the Defendants, Millennium Trucking Co. and Kin Chi Ng, are liable for only 75%, then they share of liability of the Plaintiff?s damages could exceed $2,250,000.
The payment of $959,475.77 is not ?in the ballpark? of $2,250,000.00, as it represents only about 50% of a likely recovery.
Accordingly, the moving Defendants have not provided sufficient facts to identify an approximation of their share of liability.
3) recognition that a settling party should pay less in settlement than if found liable after a trial
Since the Defendants are offering to pay an amount before trial, California law recognizes that they should pay less than a potential verdict, if the matter proceeded to trial and the jury found in favor of the Plaintiff. However, since the Defendant did not provide sufficient facts regarding the Plaintiff?s approximate total recovery or the Defendant?s approximate share of liability, the Court cannot determine that the payment of $959,475.77 is a close enough approximation of their liability.
4) The allocation of the settlement proceeds among plaintiffs
This factor is not applicable.
5) The settling party’s financial condition and insurance policy limits
The Defendants state that he has offered the limit of his insurance policy. Although this is a factor to consider, as noted above, the Defendants have not provided sufficient facts to demonstrate that their payment is an equitable allocation of costs among the joint tortfeasors.
6) Evidence that the plaintiff and the settling party acted with an intent to make the non-settling parties pay more than their fair share (considered fraud and collusion under Tech-Bilt).
The Defendant?s attorney, Brian Leach, offers a conclusion in paragraph 4 of his declaration that the settlement was negotiated at ?arm?s length?. There are no facts supporting the conclusion to identify the manner by which the parties entered into the settlement agreement, e.g., through a mediator, or to demonstrate that they did not act with an intent to make the non-settling defendants pay more than their fair share.
This analysis reveals that the Defendants, Millennium Trucking Co, Inc. and Kin Chi Ng, have not met their burden of demonstrating that they are entitled to a finding that their settlement is a good faith settlement under CCP section 877.6 because they did not provide sufficient evidence regarding the Tech-Bilt factors, e.g., the essential facts need to make findings regarding the Plaintiff?s total recovery and an approximation of the Defendants? liability for the Plaintiff?s damages.
Defendants argue that their settlement is a good faith settlement for the purposes of CCP section 877.6 because they offered their insurance limits. There is legal authority holding that a disproportionately low settlement figure is often reasonable in the case of a relatively insolvent, and uninsured, or underinsured, joint tortfeasor. County of Los Angeles v. Guerrero (1989) 209 Cal. App. 3d 1149, 1157-1159 (finding that the scale of the potential damages and the defendant?s modest financial condition and insurance policy limits were controlling and effectively overrode the other Tech-Bilt factors).
The Defendants offer information from their insurance policy in exhibits A and B to the declaration of Richard McGreevy filed on May 9, 2016 to show that their limit is $1,000,000. Further, the Defendants offer facts in the declaration of Anni Wang, which is in exhibit C to Mr. McGreevy?s declaration, to show that the net assets of Millennium Trucking Co. at the close of 2014 totaled $105,215, that it operates only leased vehicles, that it has no other assets ?that are not subject to bankruptcy protection?, and that gross sales for 2015 are lower than gross sales for 2014.
It is unclear what Ms. Wang meant when she added the phrase that there are no assets ?that are not subject to bankruptcy protection?. One meaning for this statement is that Defendant, Millennium Trucking Co., will file for bankruptcy if a judgment is entered against it. This interpretation indicates that the Defendant has assets, but that it would file for bankruptcy to protect them. Accordingly, Ms. Wang?s declaration is not clear evidence that Millennium Trucking Co. has insufficient assets to satisfy a potential judgment.
Further, there are no facts regarding the assets of the Defendant, Kin Chi Ng., e.g., whether he has real property, savings, or stock. Accordingly, it cannot be determined that Kin Chi Ng has insufficient assets to satisfy a potential judgment.
Therefore, the Court will deny the motion of the Defendants, Millennium Trucking Co. and Kin Chi Ng, because they did not provide sufficient facts in their motion to meet their burden of demonstrating that the amount paid is a close approximation of their share of liability for the Plaintiff?s injuries. Further, the Defendants have failed to provide sufficient evidence to support a finding that their financial condition and policy limits are such that they should override the other Tech-Bilt factors.
RULING: