Friday, May 15, 2020
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Court of Appeal:
Economic Damages Wrongly Cut From $1.8 Million to $460,000
Opinion Says Nonsettling Tortfeasors Are Liable for Entire Amount, Without Regard to Their Percentages of Fault, Reduced Only by Settlements and Plaintiffs’ Percentage of Fault
By a MetNews Staff Writer
A judge erred in reducing an award of economic damages by 68 percent based on a jury’s finding that settling tortfeasor was, to that degree, responsible for the injury, the Court of Appeal for this district held yesterday, saying that the remaining defendants were jointly and severally liable for the entire amount.
The jury set the plaintiffs Lynn and Michael Shulers’ total economic damages, suffered as the result of a landslide on their property, at $1,756,499.99, and assessed noneconomic damages at $50,000. It determined that two employees of the federal government were each 34 percent responsible for the harm (totaling 68 percent); three other defendants were each 10 percent at fault (30 percent), and the plaintiffs were two percent to blame.
However, the government could not be saddled with damages because it had entered into what the U.S. District Court for the Central District of California determined to be a good-faith settlement with the plaintiffs, resulting in a consent judgment. The government apparently paid a total of $66,666.67—although it emerged on appeal that there was a dispute as to the amount.
Trial Court Order
Ventura Superior Court Judge Harry Walsh ordered that the three remaining defendants were jointly and severally liable for 30 percent of the economic damages—$526,950—subtracted the $66,666.67, and pared the $1,756,499.99 award to $460,283.33.
The Court of Appeal vacated that award. Justice Kenneth Yegan authored the opinion which declares:
“The judgment is modified to award appellants economic damages in the amount determined by the jury—$1,756,499.99—less the amount paid by settling tortfeasors to appellants, less $35,130 for appellants’ two percent contributory negligence. The matter is remanded to the trial court with directions to enter a modified judgment pursuant to this formula.”
Yegan’s Opinion
Yegan wrote:
“Appellants contend that respondents are jointly and severally liable for 100 percent of the economic damages, reduced by 2 percent for appellants’ contributory negligence and an offset for amounts paid by settling tortfeasors. We agree.”
He explained that with respect to economic damages, California’s rule is that tortfeasors who contributed to an individual injury are jointly and severally liable, but as to noneconomic injuries are liable only to the extent of their fault.
Where there is a determination pursuant to Code of Civil Procedure §877.6 that a settlement is in good faith—which the District Court made—the nonsettling tortfeasors are entitled to have the award against them offset by the amount paid by the settling tortfeasor but may not obtain contribution from it, Yegan recited.
Res Judicata
The appellants argued that because the federal government’s settlement was incorporated in a District Court judgment, that judgment is res judicata and the Shulers cannot garner a judgment against others in a state court action.
Yegan responded:
“In the settlement with the United States, appellants did not waive their right to seek full compensation for their loss from other tortfeasors under the California rule of joint and several liability. They waived their right to seek further compensation from the United States and its employees. Therefore, the incorporation of the settlement into a judgment does not shield respondents from joint and several liability.”
The case is Shuler v. Capital Agricultural Property Services, Inc., 2020 S.O.S. 2368.
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