SEASCAPE RESORT OWNERS’ ASSN. v. SEASCAPE RESORT, et al.

DEFENDANT SEASCAPE RESORT LTD.’S MOTION FOR GOOD FAITH SETTLEMENT

The motion for good faith settlement as to plaintiff Seascape Resort Owners’ Association (Association), cross-defendant Ellyn Rubin, and defendant Seascape Resort Ltd. (SRL) (settling parties) agreement is granted. Based on the evidence before the court, the settlement’s monetary

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

and non-monetary consideration is within the reasonable range of the settling tortfeasors’ proportional share of comparative liability for the alleged harm. (Tech-Bilt, Inc. v. Woodward- Clyde & Associates (1985) 38 Cal.3d 488, 499.)

On May 4, 2026, settling parties entered into a written settlement agreement. (Pratt Declaration, Exhibit A.) Cross-defendant Staci Power declined to settle.

The Association filed a brief in support; Stacie Power and Intervenors Wallis, Caporn and Manrao (Intervenors) filed oppositions. The court declined to consider the declarations and exhibits filed one and two court days late by Intervenors (which amounted to 1,871 pages) or the late-filed declarations by Greg Pourroy and Diane Pourroy. (Cal. Rules of Court, rule 3.1300(d); Bozzi v. Nordstrom, Inc. (2010) 186 Cal.App.4th 755, 765-766.) Late-filed papers put the moving party at a significant disadvantage particularly when they are as voluminous as these.

I. LEGAL STANDARDS

Determining good faith requires the court to determine the reasonable range of the settling tortfeasor’s proportional share of comparative liability for the plaintiff’s injuries.

“[T]he intent and policies underlying [Code of Civil Procedure] 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., supra, 38 Cal.3d at p. 499.)

“The party asserting the lack of good faith, who has the burden of proof on that issue (§ 877.6, subd. (d)), should be permitted to demonstrate, if he can, that the settlement is so far ‘out of the ballpark’ in relation to these factors as to be inconsistent with the equitable objectives of the statute. 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. at pp. 499-500.) Where there is a factual dispute, determination of good faith is left to the court’s discretion. (Id. at p. 502.)

II. SETTLEMENT TERMS The essential settlement terms are:

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

1. Association agreed to abide by and enforce the rulings of this court and the governing documents of the Resort.

2. SRL agreed to vacate specific parking spots and provide access to certain utility rooms.

3. Association and SRL agreed upon a plan for landscaping a certain portion of the Resort.

4. SRL and Association appointed representatives to work together to resolve current and future permitting issues with the County of Santa Cruz.

5. SRL and Association agreed to negotiate and enter into a management contract for managing the Association.

6. Association and SRL calculated their monetary claims against each other related to accounts receivables and accounts payable, and determined a fair value for credits and amounts owing, resulting in a credit of $65,000.00 to SRL.

7. Damages payment of $ 215,000.00 to SRL, which has been made. SRL claimed monetary damages of over $3 million for lost business and damage to its business reputation, as well as prevailing party attorney’s fees.

8. Contained in the Settlement Agreement is the following language consistent with the Court’s ruling:

WHEREAS the Project is subdivided as a condominium project such that individual owners own condominium units but must make their units available for rent, and are restricted under the zoning ordinance and governing documents, such that an owner of a Unit may occupy his or her unit up to 90 days in one calendar year and not more than 29 consecutive days, and must use 24-hour on site centralized management. The Association is also required to use 24-hour on site centralized management for the management of the Common Area and to centrally collect TOT.

III. COURT RULINGS SINCE THIS MOTION WAS FILED

Since this motion was filed, the court has issued the following rulings in this action:

• Denied the Intervenors’ Motion to Reconsider. (July 27, 2026 Order.) • Denied the Intervenors’ Motion for Summary Adjudication. (July 27, 2026 Order.) • Entered judgment for SRL on its Motion for Summary Adjudication. (August 3, 2026 Judgment.) • Dismissed the Intervenors’ First Amended Complaint in Intervention without leave to amend. (August 3, 2026 Order.) • Dismissed Power West Properties. Inc’s First Amended Complaint in Intervention without leave to amend. (August 3, 2026 Order.)

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

IV. TECH-BILT ELEMENTS ARE SATISFIED

The court finds the Tech-Bilt factors are met here:

1. Rough approximation of plaintiff’s total recovery: Plaintiff obtained the non- monetary relief it sought.

2. Settlor’s proportionate liability: This case predominantly sought injunctions and declaratory relief by both sides. Those issues were largely determined following this court’s determination of SRL’s motion for summary adjudication. Association’s damages and attorneys’ fees exposure following that ruling was purportedly $3 million.

3. Amount paid in settlement: Monetary: $215,000.00 to SRL and a credit to SRL of $65,000.00 for accounts receivable/payable; non-monetary: resolution of key on-site Resort management issues (i.e., parking spaces, reps to communicate with County re outstanding code obligations, landscaping, management contract).

4. Allocation of settlement proceeds among plaintiffs: N/A.

5. Financial conditions and insurance policy limits of settling defendants: Unknown.

6. Existence of collusion, fraud, or tortious conduct aimed to injure the interests of non- settling defendants: Despite Intervenors’ arguments that the Association Board who settled the matter was entirely pro-SRL and therefore biased, the Association Board was elected and served in that elected capacity to settle this action. “[A]nyone who buys a unit in a common interest development with knowledge of its owners association’s discretionary power accepts ‘the risk that the power may be used in a way that benefits the commonality but harms the individual.’ [Cit. omitted.]

Generally, courts will uphold decisions made by the governing board of an owners association so long as they represent good faith efforts to further the purposes of the common interest development, are consistent with the development’s governing documents, and comply with public policy. [Cit. omitted.]” (Nahrstedt v. Lakeside Village Condominium Assn. (1994) 8 Cal.4th 361, 374.) The settlement was reached after arms-length negotiations between the parties (at least four mediation sessions over four years with two retired judges).

Intervenors argue the motion must be denied because section 877.6 does not authorize a good-faith determination to adjudicate Intervenors’ separate property rights, moving parties have not carried their burden under Tech-Bilt necessitating discovery, and the settlement is “out of the ballpark.” They also allege the Association Board that approved the settlement colluded with SRL since all Board members were pro-SRL policies and practices. Intervenors seek an order that the settlement is unenforceable and rely on an “expert” appraisal report that owners are owed $55 million in aggregated damages. (Caporn Decl. Ex. GG.) Generally, Intervenors

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

impermissibly attempt to re-litigate the entire action following this court’s dismissal of their complaint in intervention.

The court is not persuaded. First, Intervenors’ expert report concedes it is based on extraordinary assumptions and hypothetical opinions.2 Second, following Intervenors’ bias argument, any Association member is conflicted, because they either use SRL’s management services or not. Third, speculative opinion regarding Association Board elections and recalls is outside the scope of this motion and inadmissible, as are opinions regarding SRL’s efforts to sell its business and amend the CC&Rs. Intervenors cannot enlarge the issues in the case. (Truck Ins. Exchange v. Superior Court (1997) 60 Cal.App.4th 342, 346.) Intervenors are also not joint tortfeasors; there is no remedy for them left in this action. Finally, Intervenors’ “separate property rights” to self-rent and access certain recreational facilities maintained by SRL has been rejected by this court multiple times.

The court is also not persuaded by Ms. Power’s argument that the motion seeks relief that goes beyond the confines of the statute since she never articulates that relief. As for her argument that the settlement fails to provide a rough approximation of plaintiff’s total recovery and the settlor’s proportionate liability, the court recognizes this case presents significant monetary and non-monetary relief for both sides which can be hard to value. “Although an offer of settlement must bear some relationship to one’s proportionate liability, bad faith is not ‘ ‘established by a showing that a settling defendant paid less than his theoretical proportionate or fair share.’ [Citation.]’ (Tech-Bilt, Inc. v.

Woodward-Clyde & Associates, supra, 38 Cal.3d at p. 499.) In other words, ‘a ‘good faith’ settlement does not call for perfect or even nearly perfect apportionment of liability.’ (Abbott Ford, Inc. v. Superior Court, supra, 43 Cal.3d at p. 874.) All that is necessary is that there be a ‘rough approximation’ between a settling tortfeasor’s offer of settlement and his proportionate liability. (Bay Development, Ltd. v. Superior Court (1990) 50 Cal.3d 1012, 1027-1028 [269 Cal.Rptr. 720, 791 P.2d 290].)” (North County Contractor’s Assn. v.

Touchstone Ins. Services (1994) 27 Cal.App.4th 1085, 1090-1091.) “The trial court has wide discretion in deciding whether a settlement is in good faith and in arriving at an allocation of valuation of the various interests involved.” (Id. at p. 1095.)

The court overrules evidentiary objections by Intervenors to the declarations of Sharon Pratt, Fowzy Shacker, and Kay Holcomb. The declarants’ statements at issue do not lack foundation, or constitute hearsay or improper legal opinion or argument.

The court grants defendant’s request for judicial notice supporting their reply (Exhibits 1 and 2 -- court transcripts from this action’s hearings on May 24, 2026, and July 1, 2026, and

2 The report also contains repeated typos, including that the “statements of fact contained in this report are turd [sic] and correct.”

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

Exhibit 3 -- April 23, 2026 order in Power West Prop. Inc. v. Seascape Resort Ltd., Santa Cruz County Superior Court, no. 25CV03656). (Evid. Code § 452, subd. (d).)

DEFENDANT RESORT’S MOTION TO COMPEL FURTHER RESPONSES BY CROSS-DEFENDANT STACIE POWER TO SPECIAL INTERROGATORIES, SET ONE, AND FOR MONETARY SANCTIONS

DEFENDANT RESORT’S MOTION TO COMPEL FURTHER RESPONSES BY CROSS-DEFENDANT STACIE POWER TO REQUEST FOR PRODUCTION OF DOCUMENTS, SET ONE, AND FOR MONETARY SANCTIONS

The motions are granted. Cross-defendant Stacie Power is ordered to serve verified codecompliant responses to the following discovery requests no later than September 18, 2026: Special Interrogatories, Set One, nos. 1-13, and Request for Production of Documents, Set One, nos. 3, 8, 11, 13, 15, 17, 19, 21-27, 34-38, 44.

Defendant Seascape Resort served special interrogatories, set one, and requests for production of documents, set one, on cross-defendant Stacie Power on November 18, 2025. (Loweth Declarations ¶ 6.) The parties agreed to two extensions, and Power’s responses and documents were due by January 9, 2026. (Loweth Decls. ¶ 7.) Power served unverified boilerplate objections and responses on January 9, 2026, but has since failed to serve substantive responses, verifications or responsive documents. (Loweth Decls. ¶¶ 8-12.)

Special Interrogatories, Set One, nos. 1-13: These interrogatories seek information as to responding party’s ownership interest in, role, salary, and compensation from Power West Properties, Inc. (Power West), that entity’s services to the Seascape Resort Owners’ Association (Association), its marketing efforts to the Association, communication between it and any members of the Association, and events directed at those members. They appear appropriate for discovery since Ms. Power, in her individual capacity, is admittedly a current or former officer and member of the board of directors of the Association and is an owner/shareholder/director of Power West.

She therefore has the ability to answer the questions posed as both an owner of that firm and a party to this lawsuit. Ms. Power contends these interrogatories are improper under the California Financial Privacy Act (FIPA) (Financial Code §§ 4050 et seq.) and that since Power West is an intervener, defendant should seek the information from it. First, FIPA prevents financial institutions from sharing consumer information which is not at issue here. (Fin. Code §§ 4051.5, 4052.5.) Even if FIPA applied, the parties could craft a protective order to assuage Ms.

Power’s concerns. Second, Power West’s complaint in intervention has been dismissed which limits defendant’s ability to serve it with discovery on these topics. Finally, relevancy is not a proper basis to refuse to provide discovery responses and the court does not find these interrogatories harassing or oppressive.

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

Request for Production of Documents, Set One, nos. 3, 8, 11, 13, 15, 17, 19, 21-27, 34- 38, 44: These requests seek documents describing Ms. Power’s ownership in Power West, earnings made from it, communications and marketing efforts from Power West to any member of the Association from 2019 to the present, communications between Ms. Power and other former intervenors Ellyn Rubin and Julie Manrao from 2019 to the present, and messages she sent to a Facebook group “Seascape Owners Forum.” They too appear appropriate for discovery.

The court declines to impose sanctions against either party.

MOTION FOR LEAVE TO INTERVENE BY ANNIE HILDEBRAND AND JEFF CROTHERS

The motion is denied.

Proposed intervenors Annie Hildebrand and Jeff Crothers seek to intervene on behalf of the Seascape Resort Owners’ Association (Association) against Seascape Resort Ltd. (SRL) related to SRL’s alleged new exclusive rights to the main and south bluff pools and recreational facilities and the prohibition of self-renting by owners. They generally allege improper selfdealing by SRL and failure to obtain the necessary votes of members for any change to the use of common areas. The proposed complaint states claims for violation of Civil Code section 4600 [exclusive use of common area]; breach of fiduciary duty; enforcement of governing documents (Civil Code section 5975); prescriptive easement; declaratory relief; unfair competition; and quiet title. (Golden Declaration.) These claims are identical to those posed by former intervenors Wallis, Caporn, and Manrao.

Both the Association and SRL filed oppositions to the motion.

The court has discretion to permit intervention when a party has a direct, not consequential, interest in the matter in litigation. (Simpson Redwood Co. v. State of California (1987) 196 Cal.App.3d 1192, 1200; Kobernick v. Shaw (1977) 70 Cal.App.3d 914, 918.) In addition to a direct interest, intervention must not enlarge the issues raised by original parties and not tread on the rights of the original parties to conduct their own lawsuit. (See Kuperstein v. Superior Court (1988) 204 Cal.App.3d 598, 600.) The reasons for intervention must outweigh any opposition. (Truck Insurance Exchange v. Superior Court (1997) 60 Cal.App.4th 342, 346.)

Proposed intervenors’ substantive allegations appear to relate to the use of the main and south bluff pool recreational facilities and SRL’s alleged improper self-dealing. These allegations, if included in the complaint, appear to mimic those of other Intervenors Wallis, Caporn, and Manrao, who sought to unwind this court’s December 31, 2025, order on SRL’s motion for summary adjudication. This court has already determined that intervenors are bound by that order and cannot now seek different relief on behalf of the Association, when the

LAW AND MOTION TENTATIVE RULINGS DATE: AUGUST 14, 2026 TIME: 8:30 A.M.

Association has already litigated those very issues. (Hospital Council of Northern Cal. v. Superior Court (1973) 30 Cal.App.3d 331, 336 [intervenors are “bound by the record of the action at the time”].) Intervenors “must not enlarge the issues raised by the original parties.” (Lincoln National Life Ins. Co. v. State Bd. of Equalization (1994) 30 Cal.App.4th 1411, 1422.)

The Association had standing to institute this action without joining its members, did so, obtained a result that failed to please some of its members, and now proposed intervenors seek to overturn or void that order via their complaint in intervention. However, it appears that the proposed complaint would address the issues already determined by this court with some new allegations regarding board members’ alleged self-dealing. The court has already determined that the Association has a duty to enforce what is required under the governing documents, declared that the main pool and the south bluff pool are the Exclusive Use Areas of Units 85 and 534, that the owner(s) of those units have control over who can access the pools, and that centralized, 24- hour on-site management of the visitor accommodation units is required. (Order.)

Further, the authority to manage the business and affairs of an owner’s association is vested in its board of directors, not its members. (Turner v. Victoria (21023) 15 Cal.5th 99, 113; Grosset v. Wenass (2008) 42 Cal.4th 1100, 1108.) This includes “the authority to commence, defend, and control actions on behalf of” the association. (Ibid.) The decision to pursue a claim on the association’s behalf “falls squarely with the authority vested in” an association’s board. (Id. at p. 1114.) “The fundamental purpose of a derivative action is to provide a means by which [a member] may seek to enforce the rights of a[n] [association] when the [] board refuses to do so.” (Ibid.)

Intervention by association members is justified when the association’s board fails to exercise good faith in defending an action against it. (Cont’l Vinyl Prods. Corp. v. Mead Corp. (1972) 27 Cal.App.3d 543, 551-552.) Here, the Association did not refuse to enforce any rights; instead, it considered the demands, determined they were unwarranted, and then fully litigated the issues related to control of the main and south bluff pools and related recreational facilities.

No. 24CV00823

NIXON v. BENSON et al.

(UNOPPOSED) PLAINTIFF’S MOTION TO ENFORCE SETTLEMENT

Parties to appear to update the Court on their settlement efforts.

This matter was originally set on June 9, 2026, and the Court’s tentative ruling indicated the unopposed motion would be granted and judgment entered pursuant to the terms of the parties’ settlement. Defendants failed to file any timely opposition to that motion. At hearing,