Apportionment of Damages: What We Know and What Remains Unsettled
| Publication year | 2012 |
| Pages | 0008 |
by Eric J. Frisch and C. Joseph Hoffman
The General Assembly enacted Senate Bill 3 in 2005 ostensibly to create "predictability and improvement" in the provision of health care and the resolution of civil claims.[1] One of the provisions attempted to change the economics of tort claims by moving Georgia from a "pure" joint and several liability scheme to an apportionment scheme for adjudicating the financial responsibility of multiple tortfeasors. More than seven years later, this change has yet to yield greater "predictability" for tort litigants. Instead, civil trial participants face unanswered questions and multiple rulings about the mechanics and effect of the statutory scheme. In this article, we highlight the areas that we believe the appellate courts will need to address to help all participants going forward.
We have tried to be fair to the respective positions of plaintiffs and defendants in our assessment of the issues because the uncertainties affect all parties. Although appellate decisions have affirmed the constitutionality and general applicability of the tort-reform statutes, at present, only a few reported decisions address the practical aspects of how apportionment works. With this framework in mind, we examine O.C.G.A. § 51-12-33, the main statute governing "apportionment" of damages. Next, we analyze how other states have approached issues such as which party bears the burden of proof when there is a request to apportion liability among parties (with and without nonparties) and evidentiary issues that arise when a party seeks to apportion damages to a nonparty.
From "Pure" Joint and Several To "Several" Liability
By moving from a "pure" joint and several liability scheme to an apportionment scheme, the General Assembly altered the economics of recovering damages from multiple tortfeasors. Under "pure" joint and several liability, the plaintiff controlled which of several defendants it wanted to sue for an injury. In the underlying lawsuit, the claimant could obtain a single verdict against the named defendant or defendants, regardless of who was more at fault as compared between them or as compared to nonparties, subject only to a common-law right to setoff the verdict by the amount paid in prior settlements for the same claims (if any). As a result, the named defendant(s) bore 100 percent of the economic loss, which was particularly significant if another tortfeasor was insolvent, immune, or otherwise unable to be joined in the lawsuit. In exchange for shifting the risk of insolvency from the plaintiff to the defendant, the General Assembly granted a defendant the right to seek contribution. However, the defendant had to file a separate lawsuit and prove the amount it overpaid as compared to the fault of other tortfeasors.
"Proportional Share" Liability
Now, through a combination of Sections 51-12-31 and 51-12-33 of the Georgia Code, the General Assembly has shifted the economic risk of loss (insolvency, immunity, and inability to be joined) from the defendants to the plaintiff. Under Section 51-12-31, when multiple tortfeasors are sued, the plaintiff may recover for an injury caused by any defendant only from the defendant or defendants liable for the injury and the jury may specify the damages to be recovered from each defendant. Under the circumstances, individual judgments are entered against multiple defendants based on the harm only they caused, or what we will call the defendant's "proportional share."
The role of the factfinder should be to assess (1) whether there is liability at all; (2) if so, the entire amount of the verdict to be awarded as compensation; and (3) the proportional share each individual defendant contributed to the injury. Each defendant pays its share, as adjudicated by the factfinder. For example, assuming a case of plaintiff against three named defendants and a total verdict of $100,000, the factfinder would determine the proportional share for each defendant: A, B, and C. If the factfinder concludes that A was 70 percent liable, B was 30 percent liable, and C was 0 percent liable, then A pays $70,000, B pays $30,000, and C pays $0.
What About Contribution?
In exchange for limiting a tortfeasor's liability to its proportional share of the damages, the tortfeasor gives up its former right to seek contribution. Using our example above, A could not sue B or C, and B could not sue C, for contribution. This makes economic sense: there is no need for contribution because the factfinder has adjudicated the percentages of fault. Although the tortfeasor bearing the biggest share of the verdict may believe that it overpaid, its argument is likely to fall on deaf ears because the judgment is likely to be considered res judicata on the issue of its comparative share of the liability.[2]
The Effect of Nonparties on Multiple Tortfeasor Litigation
Together with Section 51-12-31, the General Assembly expressed its intent in Section 51-12-33 that a tortfeasor should only bear the risk of loss related to the injury it causes by empowering the jury to determine the comparative fault of everyone who contributed to the alleged damages. The General Assembly made this clear in subsection (e), which allows apportionment to a nonparty even if that nonparty could not be joined or would be immune from suit. We will look at how the Georgia appellate courts have construed Sections 51-12-31 and 51-12-33 together.
What We Know About How Apportionment Works in Georgia
As of the date of this article, there have been roughly 25 appellate decisions citing Section 51-1233 following the Tort Reform Act of 2005. Below, we look at how the appellate courts have (and have not) addressed constitutionality, the scope and breadth of the statutes, and some practical applications, such as setoff, burden of proof, and evidentiary issues.
The Apportionment Scheme is Constitutional
There have been attempts to challenge the constitutionality of the new apportionment scheme, but the Supreme Court has upheld the statute.[3] In Couch v. Red Roof Inns, Inc., the Court rejected constitutional challenges based on deprivations of the right to a jury trial, due process, and equal protection in the context of jury instructions and inclusion of nonparties on the verdict form. The Court held that Section 51-12-33 did not violate the right to a jury trial because apportionment does not have an effect on any part of the jury's normal functions (i.e., assessment of fault, calculation of damages, etc).[4]Similarly, Section 51-12-33 does not violate due process or equal protection because it not vague, does not conflict with any other statute and the General Assembly had a rational basis for "apportioning damages among all tortfeasors responsible for harming a plaintiff in an efficient and orderly manner."[5] Now that the Supreme Court of Georgia has upheld the constitutionality of Section 51-12-33, it appears that most efforts to declare it unconstitutional are coming to an end.
Apportionment Does Not Apply When Liability is Purely Derivative
One of the first cases applying apportionment came in the case of PN Express v. Zegel, in which the issue was whether an employerdefendant could defend and apportion by claiming that the employee worked for a nonparty entity.[6] The Court of Appeals of Georgia held that a liable but passive tortfeasor may not reduce its proportional share of liability by attempting to shift the loss to a nonparty. In Zegel, the plaintiffs sued a truck driver and an entity that plaintiffs alleged employed the driver under a number of alternative theories for injuries arising out of a wreck. PN Express defended by claiming that it did not employ the driver and by giving notice that certain nonparties directed and controlled the driver or negligently supervised him. PN Express asked the trial court to instruct the jury that they could apportion fault to the nonparties. The trial court declined to give the instruction, although the appellate opinion is silent as to why. The Court of Appeals of Georgia held that the trial court did not have to charge the jury on apportionment because the plaintiffs' theory against PN Express was "entirely based on notions of derivative liability."[7] In affirming the decision not to give a jury instruction on apportionment, the Court of Appeals of Georgia held that, "where a party's liability is solely vicarious, that party and the actively-negligent tortfeasor are regarded as a single tortfeasor," and thus comparative fault statutes "do not apply."[8]
Although the conclusion regarding apportionment is consistent with established Georgia precedent regarding the treatment of an employer and employee as one tortfeasor, the PN Express case is a little difficult to understand because of the way the opinion presents the facts surrounding the request to apportion. It appears that PN Express was arguing that it did not employ the driver and, for that reason, the "real" employer should be included on the verdict form. The Court of Appeals of Georgia apparently rejected this contention based on the plaintiffs' theory of the case, i.e., the contention that PN Express was vicariously liable. As a matter of procedure, if there was evidence that PN Express did not employ the driver at all, then the trial court could have instructed the jury on apportionment because the jury could have concluded that PN Express was "not liable" at all.
Setting aside the factual nuances of the case, the premise underlying the court's decision is correct: an entity that is truly vicariously liable should not...
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