RSS Feed LinkedIn Instagram Twitter Facebook
FMG Law Blog Line

Posts Tagged ‘contribution’

Court of Appeals Breathes New Life into Joint and Several Liability in Georgia

Posted on: April 4th, 2013

By: Phil Savrin

For many years, the rule in Georgia was that tortfeasors could be liable jointly and severally for bodily injury or death, without apportionment unless the plaintiff was found to be some part at fault. If a plaintiff was not partly at fault, then he could collect the entire judgment from any one of the tortfeasors who would then have contribution claims among them for payment of equal shares. So, for example, a property owner who was only 1 percent at fault for an assault as compared to the assailant could nevertheless be responsible for 100 percent of a judgment.

The Georgia Legislature changed these rules measurably when it enacted the Tort Reform Act of 2005. As the name of the Act states, the statutes were intended to stem the tide of liabilities from being imposed on businesses who had become easy marks for lawsuits. In one part of the Act, the Legislature amended O.C.G.A. § 51-12-33 to require the trier of fact to apportion liability among joint tortfeasors whether or not the plaintiff was partly at fault. The statute was amended even further to allow a defendant to include culpable nonparties on the verdict form for purposes of apportionment by the jury. Consistent with these new rules, the Legislature amended O.C.G.A. § 51-12-32, which had allowed for contribution among tortfeasors who jointly caused the plaintiff’s harm. As amended, the statute provides that contribution may be enforced against joint tortfeasors as if an action had been brought against them jointly, “except as provided in Section 51-12-33.” Because that statute requires apportionment, many lawyers, judges and commentators assumed that joint and several liability had been abolished.

To paraphrase the late Mark Twain, the reports of the demise of joint and several liability may have been exaggerated. In Zurich American Insurance Company v. Heard, in a decision issued March 28, 2013, the Court of Appeals reversed a trial court’s ruling and found that a tortfeasor that settled a claim for more than another tortfeasor could sue for contribution so that each tortfeasor pays an equal share of the total amount paid. The Court found that Section 51-12-33 requires apportionment only if the tortfeasors are sued jointly. If that occurs and the jury actually apportions damages, then (and then only) would contribution be precluded. If that does not occur, however, then the “old” contribution rules of Section 51-12-32 remain in effect.

In practical terms, this latest construction of the statutes has the following implications. Unless a lawsuit is filed and it proceeds to judgment in which the jury actually apportions the liabilities, whoever pays a claim can pursue other parties for contribution in equal shares regardless of the degrees of fault the parties may have. Because any degree of fault suffices to show contribution, the defense of such a claim may be very limited and impossible to show if a payment was in fact made. In addition, there is case law that might allow a defendant to bring a third party claim against another tortfeasor prior to the main claim being resolved. If the matter proceeds to judgment, the plaintiff can then apportion liability to the third party. Alternatively, if the defendant settles, it might then pursue a contribution claim against the third party defendant. Theoretically, therefore, a defendant might be able to bring a settling party back into the case.

Depending on the circumstances of the case, indemnity by the plaintiff could provide some protection to a settling party, especially if the indemnity includes cost of defending a contribution claim. There is a chance the Supreme Court of Georgia will review the Court of Appeals’ construction of these statutes, with contribution claims among joint tortfeasors being relegated once again to the annals of Georgia jurisprudence. Unless and until that occurs, litigants and their insurers are encouraged to consider the ramifications of settling claims that may not extinguish all of the exposures presented.

Right of Contribution among Joint Tortfeasors is Still Viable in Georgia

Posted on: April 2nd, 2013

By: Bart Gary

Most believed that the right of contribution among joint tortfeasors (two or more persons whose negligence combine to cause injury or damage) was abolished in Georgia in 2005 when the tort reform legislation went into effect. On March 28, 2013, the Georgia Court of Appeal issued its opinion in Zurich Amer. Ins. Co. v. Heard, 2013 WL 124544, and held that the concept of contribution in negligence cases is not completely dead. The case involved a newly constructed hotel with mold and moisture problems. The hotel owner initiated an arbitration proceeding against the general contractor, whose insurers settled the claims, but the contractor did not acknowledge liability and the parties agreed that the settlement did not fully satisfy the owner’s claims. The hotel owner also filed a lawsuit against the designers (architect and engineers) for the hotel and settled with the designers for a relatively modest amount. The insurers of the general contractor sued the designers to recover in contribution and indemnity. The trial court granted summary judgment to the designers as to the contribution claim, but the Court of Appeals reversed that ruling, and held:

[J]oint liability and the right of contribution no longer exist when damages have been apportioned by the trier of fact under this subsection. Based upon this plain language, it cannot be interpreted to abolish the right of contribution between settling joint tortfeasors when there has been no apportionment of damages by a trier of fact. When enacting subsection (b) of OCGA § 51–12–33 in 2005, the Legislature left OCGA § 51–12–32 intact in its entirety and it remains valid law. This latter Code section provides:

(a) Except as provided in Code Section 51–12–33, where a tortious act does not involve moral turpitude, contribution among several trespassers may be enforced just as if an action had been brought against them jointly. Without the necessity of being charged by action or judgment, the right of a joint trespasser to contribution from another or others shall continue unabated and shall not be lost or prejudiced by compromise and settlement of a claim or claims for injury to person or property or for wrongful death and release therefrom.

(b) If judgment is entered jointly against several trespassers and is paid off by one of them, the others shall be liable to him for contribution.

(c) Without the necessity of being charged by an action or judgment, the right of indemnity, express or implied, from another or others shall continue unabated and shall not be lost or prejudiced by compromise and settlement of a claim or claims for injury to person or property or for wrongful death and release therefrom.

(Emphasis supplied.) Based upon the plain language of this statute, the right of contribution between joint tortfeasors has not been completely abolished by the Legislature’s enactment of OCGA § 51–12–33(b), and the trial court erred by holding otherwise. (Citations and footnotes omitted; emphasis by the court).

Settlements of negligence cases must account for the potential for contribution claims by or against a settling party, who is or may be a joint tortfeasor, as was the case before 2005.