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Fullerton Redevelopment Agency v. Southern California Gas Co.

March 30, 2010

FULLERTON REDEVELOPMENT AGENCY ET AL., PLAINTIFFS, CROSS-DEFENDANTS AND RESPONDENTS,
v.
SOUTHERN CALIFORNIA GAS COMPANY, DEFENDANT AND CROSS-COMPLAINANT;
UNION PACIFIC RAILROAD COMPANY, CROSS-DEFENDANT AND APPELLANT.



Appeal from an order of the Superior Court of Orange County, Thierry Patrick Colaw, Judge. Affirmed. (Super. Ct. No. 05CC12342).

The opinion of the court was delivered by: Fybel, J.

CERTIFIED FOR PUBLICATION

OPINION

Introduction

The Fullerton Redevelopment Agency and the City of Fullerton (collectively, Fullerton) sued Southern California Gas Company (SoCal Gas); Fullerton claimed damage to property it owned was caused by hazardous waste contamination. SoCal Gas cross-complained against Fullerton and Union Pacific Railroad Company (Union Pacific) for contribution and indemnity. A department of the State of California issued a remedial action order requiring Fullerton, Union Pacific, SoCal Gas, and others to clean up the same property.

Fullerton and SoCal Gas entered into a settlement agreement, and the trial court determined that the agreement was a good faith settlement, which would bar any claims for contribution and indemnity against Fullerton by any joint tortfeasors. Union Pacific appeals, arguing the good faith settlement order could not bar claims it might bring against Fullerton under Health and Safety Code section 25363, a provision of the Carpenter-Presley-Tanner Hazardous Substance Account Act (HSAA), which permits contribution and indemnity claims by parties who incur costs to comply with remedial cleanup orders.

We hold that the good faith settlement agreement between Fullerton and SoCal Gas bars any claims against Fullerton for contribution and indemnity asserted by Union Pacific under Health and Safety Code section 25363. Therefore, we affirm the trial court's order. We publish this opinion to clarify the applicability of the good faith settlement principles outlined in Code of Civil Procedure sections 877 and 877.6 to the statutory right to contribution and indemnity created by Health and Safety Code section 25363.

Statement of Facts and Procedural History

In 1998, Fullerton acquired property (the property) from Union Pacific. Before Fullerton was able to complete its development of the property into a city park, it learned that the property was contaminated with several hazardous materials, which had been deposited on or had migrated onto the property. Fullerton sued SoCal Gas in November 2005 for injunctive relief and damages. SoCal Gas filed a cross-complaint for contribution and indemnity against Fullerton, Union Pacific, and Service Roofing Company.

In June 2007, the California Department of Toxic Substances Control (the Department) issued a remedial action order regarding the property. The order listed Fullerton, SoCal Gas, and Union Pacific (among others) as potentially responsible parties (PRP's) for the cleanup of the property.

In September 2008, Fullerton and SoCal Gas executed a settlement agreement resolving "all disputes between them arising from" the complaint and the cross-complaint. Under the terms of the settlement agreement, SoCal Gas agreed to perform all removal work specified in the Department's remedial action order. SoCal Gas also agreed to pay Fullerton (1) $800,000 if SoCal Gas obtained from Union Pacific a full release of Union Pacific's contribution, indemnity, or apportionment claims against Fullerton, or (2) $1 million if a full release was not obtained from Union Pacific.

Fullerton then filed a motion for determination of a good faith settlement, asking the trial court to find "that Fullerton is to be discharged from all liability for any contribution to any other party [citation], and that all other alleged joint tortfeasors or co-obligors are barred from bringing any further claims against Fullerton `for equitable comparative contribution, or partial or comparative indemnity, based on comparative negligence or comparative fault.' [Citation.]" Union Pacific did not contest the good faith nature of the settlement, but argued in opposition to the motion that the settlement could not bar Union Pacific's potential claim for statutory contribution and indemnity against Fullerton under Health and Safety Code section 25363. The trial court granted Fullerton's motion in a written order reading, in relevant part, as follows: "The proposed settlement agreement . . . is deemed a good faith settlement for all purposes, including the application of Code of Civil Procedure (`CCP') sections 877 and 877.6. [¶] . . . Pursuant to CCP section 877, [Fullerton is] hereby discharged from `all liability for any contribution' to any other party, person or entity. [¶] . . . Pursuant to CCP section 877.6, all claims against [Fullerton] `for equitable comparative contribution, or partial or comparative indemnity, based upon comparative negligence or comparative fault,' are hereby barred, including, but not limited to, any such claims that may be brought under Health & Safety Code section 25363 or under any applicable common law."

Union Pacific's petition for a writ of mandate was summarily denied by this court. ...


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