United States District Court, E.D. California
LESLIE J. CHANCE, Plaintiff,
PRUDENTIAL INSURANCE COMPANY OF AMERICA, Defendant.
ORDER GRANTING JOINT MOTION TO APPROVE MINORS’
SETTLEMENT (DOC. NOS. 24)
the court is the parties’ joint motion to approve a
compromise of the minors’ claims in this action. (Doc.
No. 24.) A hearing on the motion was held June 21, 2016.
Attorney Craig A. Edmonston appeared with and on behalf of
plaintiff and counter-defendant Leslie J. Chance, third-party
defendant Jessica Lopez (also known as Jessica Bullman), and
third-party defendants S.D.C. and S. N.C. Attorney Rebecca
Tana Green appeared on behalf of defendant and third-party
plaintiff Prudential Insurance Company of America.
considered the parties’ requests and heard oral
argument, and for the reasons set forth below, the court
grants the motion to approve the minors’ compromise.
AND PROCEDURAL BACKGROUND
Prudential Insurance Company of America
(“Prudential”) issued a group life insurance
policy, Group Policy No. G-46581-OR, to Con-way, Inc. The
life insurance policy provided a benefit in the amount of
$84, 000.00 to decedent Todd Chance. (See Doc. No. 8
at 7, Ex. A.)
August 25, 2013, Todd Chance died as a result of multiple
gunshot wounds. At the time of his death, Todd Chance had not
designated a beneficiary to receive the proceeds from his
death benefit. The beneficiary rules provision of the life
insurance policy provides that benefits are payable to the
designated beneficiary. If there is no designated
beneficiary, the benefits are payable to the first of the
following: “(a) surviving spouse or Registered Domestic
Partner; (b) surviving child(ren) in equal shares; (c)
surviving parents in equal shares; (d) surviving siblings in
equal shares; (e) estate.” (See Doc. No. 8,
Ex. A at 32.) At the time of his death, Todd Chance was
married to plaintiff Leslie J. Chance, and had three
surviving children: Jessica Lopez, a/k/a Jessica Bullman
(currently age 26), S.D.C. (currently age 17), and S. N.C.
(currently age 15).
September 30, 2013, plaintiff submitted a claim to the death
benefit as Todd Chance’s surviving spouse. On November
20, 2013, and again on January 12, 2015, the Kern County
Sheriff’s Office advised Prudential that plaintiff was
a suspect in Todd Chance’s death. She denies any
involvement in the death, and no charges have been filed.
Because California law prohibits payment of a life insurance
benefit to a beneficiary who feloniously and intentionally
kills the person upon whose life the policy is issued, see
Cal. Prob. Code § 252, 254, there existed a dispute as
to whether the benefits provided to Todd Chance are payable
to plaintiff Leslie Chance (i.e., his surviving spouse) or
instead to his three surviving children.
August 25, 2015, plaintiff Leslie Chance commenced this
action for breach of contract and declaratory relief, in Kern
County Superior Court. (See Doc. No. 1-1.) On
December 18, 2015, defendant Prudential removed this action
from state court. (Doc. No. 1.) On December 28, 2015,
defendant filed an answer to the complaint and a third-party
complaint against Todd Chance’s three children. (Doc.
No. 8.) On February 4, 2016, the court appointed Leslie J.
Chance as guardian ad litem to Todd Chance’s two
surviving minor children, S.D.C. and S. N.C. (Doc. No. 16.)
On April 27, 2016, the parties filed a notice of joint
settlement. (Doc. No. 22.) On May 2, 2016, the parties filed
the instant motion to approve a compromise of the
minors’ claims in this action. (Doc. No. 24.)
terms of the settlement agreement are outlined in the instant
joint motion (Doc. No. 24 ¶¶ 16-30) and embodied in
the accompanying proposed order submitted by the parties
(Doc. No. 24-5). Pursuant to the settlement agreement, the
parties agree that no benefit other than the death benefit
described herein is payable under the group life insurance
policy, Group Policy No. G-46581-OR. (Doc. No. 24 ¶ 17.)
The parties agree that the death benefit (plus any applicable
interest) shall be payable in equal one-third shares to each
of the decedent’s surviving children, Jessica Lopez,
S.D.C., and S. N.C. Plaintiff Leslie Chance will not receive
any portion of the death benefit. (Id. ¶ 18.)
Upon Prudential mailing the checks to each of the parties and
their counsel, plaintiff Chance and third-party defendants
Lopez, S.D.C., and S. N.C. release any and all claims each
asserted or could have asserted against Prudential arising
under the group life insurance policy or the death benefit
and are further restrained from bringing any actions or
proceedings against Prudential with respect to those claims.
(Id. ¶ 27.)
OF MINORS’ COMPROMISE
court has a duty to protect the interests of minors
participating in litigation before it. Salmeron v. United
States, 724 F.2d 1357, 1363 (9th Cir. 1983). To carry
out this duty, the court must “conduct its own inquiry
to determine whether the settlement serves the best interests
of the minor.” Robidoux, 638 F.3d at 1181
(quoting Dacanay v. Mendoza, 573 F.2d 1075, 1080
(9th Cir. 1978)); see also Salmeron, 724 F.2d at
1363 (“[A] court must independently investigate and
evaluate any compromise or settlement of a minor’s
claims to assure itself that the minor’s interests are
protected, even if the settlement has been recommended or
negotiated by the minor’s parent or guardian ad
litem.”) (citation omitted). In considering the
fairness of a settlement of a minor’s claim, federal
courts sitting in diversity generally are guided by state
See Tashima & Wagstaffe, California Practice
Guide: Federal Civil Procedure Before Trial ¶ 15:138
(Cal. & 9th Cir. Eds. 2015) (“Federal courts
generally require that claims by minors . . . be settled in
accordance with applicable state law. California law requires
court approval of the fairness and terms of the
settlement.”). A settlement for a minor and
attorney’s fees to represent a minor must be approved
by the court. Cal. Prob. Code § 3601; Cal. Fam. Code
§ 6602. Reasonable expenses and court costs to be paid
out of the settlement also must be approved by the court.
Cal. Prob. Code § 3601. In addition, the Local Rules of
this court require disclosures regarding the minors involved,
the nature of the controversy, the manner in which the
compromise was determined, and whether a conflict of interest
may exist between the minor and her attorney. See
Local Rules 202(b)-(c).
the proposed settlement agreement provides that defendant
Protective will pay each of Todd Chance’s surviving
children a one-third share of the death benefits under the
life insurance policy at issue. Thus, each minor will receive
an amount similar to that to which she would likely be
entitled as a beneficiary under the plan, in the absence of a
qualified surviving spouse or registered domestic partner.
Having carefully reviewed the parties’ submissions, the
court finds that the proposed settlement is fair and
addition, the instant petition seeks an order awarding
attorney’s fees amounting to 25% of the total recovery
for each minor. Is has been the practice in the Eastern
District of California to consider 25% of the recovery as the
benchmark for attorney’s fees in contingency cases
involving minors. See, e.g., Mitchell v.
Riverstone Residential Grp., No. 2:11-cv-02202-LKK-CKD,
2013 WL 1680641, at *2 (E.D. Cal. Apr. 17, 2013); McCue
v. South Fork Union Sch. Dist., NO.
1:10-cv-00233-LJO-MJS, 2012 WL 2995666, at *2 (E.D. Cal. Jul.
23, 2012); Welch v. Cty. of Sacramento, No.
2:07-cv-00794-GEB-EFB, 2008 WL 3285412, at *1 (E.D. Cal. Aug.
5, 2008); Red v. Merced Cty., No. 1:06-cv-01003-GSA,
2008 WL 1849796, at *2 (E.D. Cal. Apr. 23, 2008); Schwall
v. Meadow Wood Apartments, No. 2:07-cv-00014-LKK, 2008
WL 552432, at *1, (E.D. Cal. Feb. 27, 2008); Walden v.
Moffett, No. 1:04-cv-06680-LJO-DLB, 2007 WL 2859790, at
*3 (E.D. Cal. Sept. 20, 2007). The court finds the award of
attorney’s fees sought to be reasonable under the
for the reasons stated above, the court grants the joint
motion for minors’ compromise (Doc. No. ...