Transcript APPORTIONMENT OF LIABILITY

APPORTIONMENT OF LIABILITY
PRACTICAL IMPACT
OF DEBENEDETTO
ON MULTI-PARTY
LITIGATION
PRESENTED BY:
Getman, Schulthess & Steere, P.A.
HISTORY OF APPORTIONMENT
Based on RSA 507:7-e
 Purpose is to protect “deep pocket”
minimally liable defendants from
bearing a disproportionate share of
damages awards
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RSA 507:7-e
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Jury awards damages against each
defendant according to proportionate fault of
each of the “parties”
Each “party” is jointly & severally liable if 50%
or more at fault
Each “party” is severally liable for only its
proportionate share if less than 50% at fault
NILSSON CASE
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Nilsson v. Bierman, 150 N.H. 393 (2003)
For purposes of apportionment under RSA
507:7-e the word “party” refers to all persons
or entities who take part in an accident or
transaction
“Party” includes settling “parties”
DeBENEDETTO CASE
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DeBenedetto v. CLD Consulting Engineers,
Inc., 153 N.H. 793 (2006)
“Party” for purposes of apportionment under
RSA 507:7-e includes all parties contributing
to an occurrence
Includes persons/entities immune from
liability
Includes persons/entities not otherwise
before the court
TIBERGHEIN CASE
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Tiberghein v. B.R. Jones Roofing, 156 N.H.
110 (2007)
RSA 507:7-e apportionment also applies to
arbitration awards
BURDEN OF PROOF
Burden of establishing fault on the part of
a non-litigant tortfeasor lies with the
litigant defendants in the case
Everitt v. General Electric, 156 N.H. 202 (2007)
ADEQUATE EVIDENCE
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Allegations against non-litigant tortfeasors
must be supported with “adequate evidence”
DeBenedetto v. CLD Consulting Engineers
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Conduct discovery to obtain facts supporting
non-litigant tortfeasor’s fault
Defendant seeking apportionment is in
position analogous to that of plaintiff
EXPERT TESTIMONY
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Expert opinion testimony is required to
establish non-litigant tortfeasor’s fault in:
1) professional liability cases
Goudreault v. Kleeman,158 N.H. 236 (2009)
2) any case which would ordinarily
require expert testimony
PRE-TRIAL SETTLEMENT
BY PARTY DEFENDANT
A settling party cannot be compelled to
litigate fault
Everitt v. General Electric
SUPERIOR COURT ORDERS
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Since Nilsson & DeBenedetto, trial courts
have attempted to predict how the Supreme
Court would apply non-party apportionment
in a variety of circumstances
BOISVERT v. GINSBERG
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Plaintiff brought negligence action for injuries
resulting from spinal surgery
Principal doctor/tortfeasor settled before trial
Remaining defendants sought disclosure of
terms of settlement in order to assess
exposure & analyze contribution issues
(cont.)
BOISVERT v. GINSBERT (cont.)
Court (J. Mangones) held:
1. Defendant not entitled to settlement
information – evidence of settlement is
barred under RSA 507:7-I
2. Settlement is irrelevant until jury reaches
verdict and apportions damages
3. Court only required in camera review of
settlement terms
WATSON v. ELITE LIFESTYLES
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Plaintiffs sued defendants claiming poor
construction of addition to their home
Two of the defendants defaulted
Court would not apportion liability to
defaulted defendants until after trial of case
against remaining defendants
(cont.)
WATSON v. ELITE LIFESTYLES (cont.)
Court (J. Mohl) held:
1. Evidence of default judgment would be
admitted at trial (to help jury understand role
of each entity in the construction)
2. The amount of damages awarded against
defaulted defendants was not admissible
(it would “mislead the jury as to their
function in assessing damages”)
PETRUCELLI v. STEPHEN
D’ABROSCA, et al
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Dispute between former business partners
concerning formation, operation, sale and
winding up of car dealership
Plaintiff sued former owner, the business
entity, and its law firm
Plaintiff settled with the law firm before trial
Defendant sought apportionment of liability to
law firm and two other non-parties
PETRUCELLI v. D’ABROCSA, et al
(cont.)
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Court denied apportionment due to
inadequate evidence and lack of expert
evidence as to law firm
Jury awarded over $2M – 80% of fault was
apportioned to the former partner
RUEL v. NORTH AMERICAN
AMUSEMENT
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Minor child injured in “moon bounce” carnival
ride
One defendant sought apportionment against
child’s father
Plaintiff sought to exclude evidence against
father due to defendant’s failure to
adequately answer interrogatories pertaining
to father (cont.)
RUEL v. NORTH AMERICAN
AMUSEMENT (cont.)
Court (J. Wageling) ruled:
1. Defendant could seek apportionment
against father as long as it submitted
“adequate evidence” at trial
2. Plaintiff could reference any deficiency in
evidence presented
RALLIS v. GLADSTONE
Court (J. McHugh) held:
1. If a non-settling defendant plans to argue
for apportioning fault to a settling party, it
should be required to specify its reasons in
its DeBenedetto disclosure
2. Adequate disclosure may assist plaintiff in
determining whether to settle with any
defendant prior to trial
COLMAN v. SIPKEMA
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Plaintiff and defendant involved in car
accident
Defendant sought to apportion liability
against third, unknown driver
Details pertaining to the unidentified car
came from plaintiff and were “sketchy”
(cont.)
COLMAN v. SIPKEMA (cont.)
Court (J. McHugh) held:
1. Defendant could not seek apportionment to
the unidentified driver due to insufficient
evidence & speculative nature of claim
2. Defendant would be permitted to introduce
the evidence only in order to establish
comparative fault on the part of plaintiff
RAY v. GEICO
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Plaintiff’s vehicle hit by uninsured driver
Plaintiff brings UM claim
Evidence showed that unidentified third
driver may have contributed to accident
UM insurer sought apportionment as to “hit &
run” driver – stands in the shoes of the
uninsured motorist and entitled to assert
same defenses (cont.)
RAY v. GEICO
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Plaintiff objected claiming: 1) purpose of UM
statute is to fully compensate parties injured
by uninsured drivers; 2) apportionment
doesn’t apply in UM case; 3) UM insurer
must compensate for harm caused by ALL
liable uninsured drivers
Court Held: Insurer may seek apportionment
of liability to unidentified driver if it can
support the claim with adequate evidence
PRACTICAL CONSIDERATIONS
In deciding whether to pursue apportionment
against non-party tortfeasor a defendant
must weigh …
Cost of litigating
fault of nonparty
v.
Likelihood of
success &
percentage fault
of non-litigant
ADEQUACY OF DISCLOSURE
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Intent to apportion liability against non-litigant
must be disclosed in advance
Strictly adhere to language of disclosure
requirement in structuring conference order
Identify all “parties” as potential DeBenedetto
defendants (including non-party tortfeasors,
immune tortfeasors, settling defendants, codefendants and “phantom” defendants)
TIMING OF DISCLOSURE
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Include broad disclosure language in Brief
Statement
File Notice of Intent to apportion to specific
tortfeasors within deadline provided for in
Structuring Conference Order
FORM OF DISCLOSURE
BRIEF STATEMENT
Sample disclosure language for Brief Statement:
The defendant reserves the right to request that
the jury or Court find fault against any and all
potential joint tortfeasors regardless of whether
they have been sued by the plaintiffs or any
other party, whether they have settled their
claims prior to trial, or whether they are
protected from suit by any immunity or other
legal bar to bringing such an action.
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FORM OF DISCLOSURE
NOTICE OF INTENT
Structuring Conference Order Form currently
requires:
“If defendant claims that unnamed parties are
at fault (see DeBenedetto), defendant shall
disclose the identity of every such party and
the basis of the allegation of fault no later
than…”
NOTICE OF INTENT
TO APPORTION LIABILITY
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Must specifically identify all persons or
entities to which apportionment may be
sought
Should set forth the factual and legal basis
for apportionment of liability to each such
person or entity
EXPANSION OF DISCLOSURE
REQUIREMENT?
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Plaintiff attorneys are lobbying to modify
structuring conference language
May require identification of co-defendants as
DeBenedetto parties for purposes of
apportionment
Failure to disclose co-defendants who later settle
could preclude apportionment
May require disclosure of witnesses, including
experts, to support apportionment as to that
party
PROPOSED LEGISLATION
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HB 1255 (introduced in 2010 session)
Would have amended RSA 507:7-e to
prohibit apportionment claims against any
person/entity immune from liability unless
that person/entity is made a party to the
action under Superior Court Rule 27
Bill deemed “inexpedient to legislate” by
Judiciary Committee
SEVIGNY v. QUESADA
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Parties amended Structuring Conference
Order Form to state:
“Pursuant to DeBenedetto v. CLD case,
defendants shall disclose by 7.15.08 the
identity of every person or party alleged to be
at fault and the basis therefore.”
SEVIGNY (cont.)
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None of the defendants disclosed intent to
apportion liability prior to deadline
Plaintiff settled with one defendant
Plaintiff withdrew medical experts they
planned to support claims against the settling
defendant
Remaining defendant sought to videotape
testimony of plaintiff’s withdrawn experts
SEVIGNY (cont.)
Trial Court ruled:
 Structuring Conference Order required
disclosure of all persons alleged to be at
fault, even if they were parties to the litigation
 Defendant could not compel testimony from
plaintiff’s withdrawn experts
 Defendant was barred from seeking to
apportion liability to any other person at trial
DISCLOSURE OF EVIDENCE
SUPPORTING APPORTIONMENT
Plaintiffs have successfully amended
Structuring Conference Order Forms to
require disclosure, by a fixed date, of:
 The identity of every person or party alleged
to be at fault
 The specific bases for the allegation of fault
 The witnesses defendant intends to call to
establish fault, including experts
PRACTICAL CONSIDERATIONS
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Requires defendant to prepare case against
co-defendant as well as its own defense
Deters cooperation among co-defendants
Results in additional expense by requiring
discovery and experts as to co-defendant
Defendant cannot rely on plaintiff’s evidence
and witnesses against co-defendant
Requires strict adherence to disclosure date
CASE STUDIES
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Few cases have reached Supreme Court, so
attorneys and trial courts in unchartered
waters
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Advantages of utilizing apportionment must
be assessed on a case by case basis
CASE #1
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Customer injured in slip & fall on commercial property
Suit filed against property owner & plumbing contractor
Property owner likely ≥ 50% at fault & contractor likely <
50% at fault
Property owner settles & potential verdict likely higher
than amount paid in settlement
DeBenedetto instruction beneficial:
1) if contractor < 50% at fault it pays only its
proportionate share;
2) if found ≥ 50% at fault, liable for 100% but gets
offset for amount paid by settling property owner
CASE #1 - ILLUSTRATION
Property owner settles for $40k prior to trial
 Case goes to trial against plumbing
contractor and contractor seeks
apportionment to property owner
 Jury reaches verdict of $100k
 1) contractor found 30% at fault – pays $30k
2) contractor found 50% at fault – pays $60k
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CASE #2
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Employee of subcontractor (SC) injured in construction
accident
Defendant general contractor (GC) minimally at fault
SC primarily at fault, but immune due to WC bar
SC contractually obligated to defend & indemnify GC
GC brings third party action v. SC
SC assumes defense of GC & seeks apportionment of fault
to SC
GC withdraws third party action
CASE #3
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Plaintiff injured due to alleged product defect
& sues multiple defendants
Primary manufacturer seeks apportionment
as to remaining defendants and non-party
component manufacturers
Primary manufacturer found ≥ 50% at fault
CASE #3 - ILLUSTRATION
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Jury awards verdict of $100k
70% apportioned to primary manufacturer
20% apportioned to co-defendants
10% apportioned to non-party component
manufacturers
Primary manufacturer pays 80% but can
seek contribution from non-parties
CASE #4
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Plaintiff injured while a passenger in vehicle
operated by spouse (Operator #1) and struck by
a second vehicle (Operator #2)
Operator #2 is clearly ≥ 50% at fault
Operator #1 settles claim for less than his
proportionate share
Operator #2 is jointly & severally liable, so liable
for 100% of verdict with offset for amount of
settlement with Operator #1
DeBenedetto apportionment neutral
CASE #4 - ILLUSTRATION
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Operator #1 settles for $20k
Trial proceeds against Operator #2 who
seeks apportionment to Operator #1
Jury awards verdict of $100k
Operator #2 found to be 70% at fault,
Operator #1 30% at fault
Operator #2 pays $80k ($100k less offset of
$20k)
CASE #5
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Construction accident with both GC and
immune employer/subcontractor at fault
If GC is ≥ 50% liable, DeBenedetto
apportionment neutral since GC has joint &
several liability
If GC < 50% liable, apportionment beneficial
since it pays only its proportionate share
CASE #5 - ILLUSTRATION
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Jury awards verdict of $100k
If GC is 60% liable and SC 40%, GC still
pays $100 due to joint & several liability
If GC is 40% liable and SC is 60% liable, GC
pays only $40k – apportionment beneficial to
GC and plaintiff bears the loss
CASE #6
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Plaintiff injured in automobile accident when
struck by Vehicle #1
Operator of Vehicle #1 claims that he
swerved to avoid unidentified operator of
Vehicle #2 who failed to yield right-of-way
Can Operator of Vehicle #1 seek
apportionment of liability to “phantom” driver?
CASE #7
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Plaintiff injured due to negligence of two
defendants and extent to which each is liable is
not clear
One defendant settles for substantial amount
Trial proceeds against remaining defendant and
jury apportions liability to settling defendant for
less than amount it paid
Remaining defendant is found ≥ 50% at fault
Does remaining defendant receive full offset?
CASE #7 - ILLUSTRATION
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Operator #1 settles for $80k prior to trial
Trial proceeds against Operator #2
Operator #2 is found 70% at fault, Operator
#1 is assigned 30%
Jury awards verdict of $100k
Operator #2 pays…?
CASE #8
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Plaintiff settles with Defendant #1
Trial proceeds against Defendant #2
Defendant #2 found < 50% at fault after
seeking apportionment to Defendant #1
Amount of liability apportioned to Defendant
#1 is less than amount it paid
Who gets “windfall”?
CASE #8 - ILLUSTRATION
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Defendant #1 settles for $80k prior to trial
Trial proceeds against Defendant #2
Jury awards verdict of $100k
Apportionment of liability is 30% to
Defendant #2 and 70% to Defendant #1
Defendant #2 pays…?
Unsettled Questions…
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Applicability of DeBenedetto apportionment
in underinsured motorist cases
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Applicability of DeBenedetto in breach of
contract cases
The End