Thursday, June 2, 2016
Court of Appeal Declares:
Set-Offs May Be Sought in Posttrial Motion to Vacate
Justice Banke Says No Court Has So Held, Explicitly, but Opinion Is Not Certified for Publication
By a MetNews Staff Writer
Where a judgment is entered almost immediately after a jury has presented its verdict, without a set-off for settlements by other defendants, the defendant may have the judgment corrected through a motion to vacate, the First District Court of Appeal has held.
The opinion, by Justice Kathleen M. Banke of the First District’s Div. One, affirms the paring of a $2.5 million judgment in favor of a slip-and-fall victim to $1 million, after allowing for set-offs and credits. A $150,000 judgment in favor of the victim’s wife for loss of consortium was not affected.
While Banke noted that “no court has expressly approved use of a postjudgment motion to vacate” in such a circumstance, she said that “a number of courts have inferentially done so,” and the court did not certify its opinion, filed Tuesday, for publication.
Liability was conceded by the only nonsettling defendant, Ukiah Adventist Hospital, which only contested damages. The verdict came in for $2,476,378.86, in favor of plaintiff Jack Tuttle, a medical sales representative, who claimed brain damage.
On April 28, 2010, he fell down two flights of stairs at the defendant’s medical complex, where his employer leased an office.
After the rendering of the verdict, the judge asked counsel if there were “anything further at the moment,” and no lawyer for either side indicated that there was.
On appeal, Tuttle argued that after judgment was entered, it was too late for the hospital to invoke Code of Civil Procedure §877 which requires an offsetting of moneys already received. In this instance, the amount received included workers’ compensation benefits, in addition to settlements by co-defendants.
Inferences From Precedents
Banke pointed out that other courts have, though without discussion as to the legitimacy of the procedural device employed, affirmed alterations of judgments to reflect offsets through the invocation of Code of Civil Procedure §663. That section provides:
“A judgment or decree, when based upon a decision by the court, or the special verdict of a jury, may, upon motion of the party aggrieved, be set aside and vacated by the same court, and another and different judgment entered, for either of the following causes, materially affecting the substantial rights of the party and entitling the party to a different judgment:
“1. Incorrect or erroneous legal basis for the decision, not consistent with or not supported by the facts; and in such case when the judgment is set aside, the statement of decision shall be amended and corrected.
“2. A judgment or decree not consistent with or not supported by the special verdict.”
No Prescribed Procedure
Banke observed that there is a “lack of any specific procedural device to obtain a section 877 setoff” and the courts have demonstrated “historical flexibility as to how the issue of setoff is presented.”
She said the motion was “timely heard and ruled on by the trial court while the court had jurisdiction to alter the judgment under section 663,” and if there were a reversal, Tuttle would obtain what §877 seeks to avoid: a double recovery.
The jurist wrote:
“Section 877 contains no requirement that a nonsettling defendant interpose an ‘objection’ when judgment is promptly entered on a jury verdict, as is often the case. Nor do we see any reason to impose such a requirement….
“In any event, Medical Center did raise its right to setoff prior to entry of judgment, in connection with the parties’ stipulation on liability. The issue of setoff was, thus, clearly in play, and the Tuttles cannot claim to have been prejudiced in any way by the fact Medical Center did not ‘object’ when, upon return of the verdict, the trial court promptly directed its recordation and entry of judgment.”
‘Common Fund Doctrine’
Banke’s opinion also rejects the contention that the set-offs should be reduced, under the common fund doctrine, to reflect the attorney fees and costs expended by the Tuttles in securing the settlements.
A California Supreme Court opinion is quoted saying that under that doctrine, “one who expends attorneys’ fees in winning a suit which creates a fund from which others derive benefits, may require those passive beneficiaries to bear a fair share of the litigation costs.”
“As far as our research discloses, no court has ever suggested this longstanding doctrine applies to the equally long-established statutory entitlement to setoff for prejudgment settlements. We conclude a deduction for plaintiff’s attorney fees and costs is inconsistent with both the plain language of section 877 and the impetus for and requirements of the common fund doctrine.”
The case is Tuttle v. Ukiah Adventist Hospital, A144759.
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