Opinion ID: 1360978
Heading Depth: 3
Heading Rank: 2

Heading: California Code of Civil Procedure Section 877.6

Text: By barring future claims for contribution and indemnity arising out of a partial settlement, section 877.6 seeks to encourage settlement and prevent settling and non-settling parties from bearing more than their proportionate share of liability. See Tech-Bilt, 38 Cal.3d 488, 213 Cal.Rptr. 256, 698 P.2d 159 (explaining the rationale behind the section 877.6 good faith hearing). However, the bar orders adopted by the district court here went beyond both the purpose and the plain language of this statute by barring all claims arising out of or related to ... any of the transactions or occurrences alleged. The California Supreme Court has held that, in making a good faith determination, the 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, 213 Cal.Rptr. 256, 698 P.2d at 166-67. The trial court's determination that the settlement is in good faith operates as a bar against future claims for contribution and indemnity from the settling defendants. Cal.Civ.Proc.Code § 877.6(c); see Far W. Fin. Corp. v. D & S Co., 46 Cal.3d 796, 251 Cal.Rptr. 202, 760 P.2d 399, 407 (1988). In his challenge to the bar orders here, Talley does not claim that the settlements were entered into in bad faith in violation of section 877.6, and he concedes that the district court has the authority to bar claims for contribution or indemnity under this statute. Rather, he argues that the district court exceeded the scope of the statutory settlement bar by drafting the orders to bar claims other than those for contribution and indemnity. We agree. A finding of good faith under section 877.6, under the terms of the statute, bars only claims of equitable comparative contribution, or partial or comparative indemnity based on comparative negligence or comparative fault. Cal.Civ.Proc.Code § 877.6(c). California courts apply a test similar to the one adopted in Gerber to determine the appropriate scope of a bar order issued pursuant to section 877.6. A bar order under section 877.6 may not bar claims other than those for contribution and indemnity or artfully pled claims that amount to claims for contribution and indemnity. Cal-Jones Props. v. Evans Pac. Corp., 216 Cal.App.3d 324, 264 Cal.Rptr. 737, 739 (1989). As the California Court of Appeal explained in Cal-Jones: If the claims between the joint tortfeasors are identical to those made by the plaintiffs or if the damages sought by the joint tortfeasors are those that the court would consider in determining the proportionate liability of the settling tortfeasor, then the claims are indemnity claims regardless of whether one or more of the claims are couched in affirmative language. A claim by a joint tortfeasor seeking neither indemnity nor contribution and which the trial court would not contemplate in determining the proportionate liability of a settling tortfeasor is not a claim for indemnity and hence survives a good faith settlement under section 877.6. If a claim is in fact one of indemnity, then it is barred pursuant to section 877.6. Id. Because the bar orders here extinguish claims other than those for contribution and indemnity or artfully pled claims that amount to claims for contribution and indemnity, they do not pass muster under section 877.6 and must be modified in accordance with the standard set forth in Cal-Jones.