Roy Paul on Joint and Several Liability vs. Apportionment

Tue, Apr 28th, 2020 | by Miles Mediation and Arbitration | ADR Resources | Social Share

By Mediator/Arbitrator Roy Paul

In evaluating liability and settlement value in tort cases with more than one potentially responsible party, Georgia litigants, in recent years, have looked to O.C.G.A. § 51-12-33. Under O.C.G.A. § 51-12-33(b), damages apportioned by the trier of fact under that code section shall be the liability of each person against whom they are awarded, shall not be a joint liability among the persons liable, and shall not be subject to any right of contribution. Based on this, many litigants assumed that joint and several liability, at least in large part, was dead.

In Federal Deposit Insurance Corporation v. Loudermilk, 305 Ga. 558, 826 S.E.2d 116 (2019), the Supreme Court of Georgia, in response to certified questions from the United States Court of Appeals for the Eleventh Circuit, addressed the interrelationship between the apportionment statute and the common-law rule imposing joint and several liability on tortfeasors who “act in concert.” The Court specifically concluded that O.C.G.A. § 51-12-33 did not abrogate the Georgia common-law rule imposing joint and several liability on tortfeasors who act in concert, at least under certain conditions.

Before expounding on the scope of the surviving concept of joint and several liability, the Georgia Supreme Court provided guidance as to the scope of the reference in O.C.G.A. § 51-12-33 to “injury to person or property.”  The Court adopted the usual and customary meaning of the term “property” as used in a legal context and concluded that “injury to person or property”, as utilized in O.C.G.A. § 51-12-33(b), included both tortious injuries to tangible and intangible property.

The Court noted:

The definition we adopt today is also consistent with the handful of Court of Appeals cases since 2005 that have applied the apportionment statute in cases involving economic and business torts, though none of those cases faced the question of statutory interpretation we have confronted today. See I.A. Group Ltd. v. RMNANDCO, Inc., 336 Ga. App. 461, 462-464, 784 S.E.2d 823 (2016) (holding that trial court committed plain error in instructing the jury on joint and several liability because the plain language of O.C.G.A. § 51-12-33 required apportionment of damages in a suit for breach of fiduciary duty and related business torts seeking damages for purely pecuniary losses); Alston & Bird LLP v. Hatcher Mgmt. Holdings, LLC, 336 Ga. App. 527, 530, 785 S.E.2d 541 (2016) (trial court was required to allow apportionment of fault in an action asserting legal malpractice and breach of fiduciary duty that caused financial losses); Levine v. Suntrust Robinson Humphrey, 321 Ga. App. 268, 269, 272, 740 S.E.2d 672 (2013) (noting that “the matter of apportioning the fault of [the multiple tortfeasors in the case], if any, is a matter for the jury[,]” in a case where a company’s bankruptcy trustee sued a corporate officer and multiple board members, alleging that they “negligently or intentionally caused the destruction of [a] business by violating fiduciary duties, breach[ed] contracts, and negligently or intentionally misrepresent[ed] information about certain business transactions, which transactions led to the insolvency of the company”). 305 Ga. at 567-68, 826 S.E.2d at 123-24.

 

Turning then to the question of whether Georgia’s apportionment statute, O.C.G.A. § 51-12-33, abrogated Georgia’s common-law rule imposing joint and several liability on tortfeasors who act in concert, the Georgia Supreme Court in Loudermilk first summarized and considered the common-law origins of the joint and several liability doctrine. The Court went on to note that in Couch v. Red Roof Inns, Inc., 291 Ga. 359, 729 S.E.2d 378 (2012) the Court had rejected the argument that a “single, indivisible” injury could not be apportioned recognizing that while the injury may be singular, the damages flowing from that injury may by apportioned by statute among the tortfeasors responsible for causing it.

 The Court found that O.C.G.A. 51-12-33(b) reveals a different analytic touchstone for damages analysis: whether fault is divisible. The Court went on to examine whether fault is divisible when an action under O.C.G.A. §51-12-33(b) is brought against more than one person and those persons have acted in concert. The Court noted that true concerted action is predicated on the idea that wrongdoers in pursuance of a common plan or design to commit a tortious act are equally liable and that through “joint enterprise” and/or “mutual agency” the act of one is the act of all. Accordingly, the Court concluded that where the fault of one person is legally imputed to another person who is part of the same joint enterprise, it cannot be said that there is a legal means of dividing fault “among the persons who are liable” as contemplated by O.C.G.A. 51-12-33(b).

The Georgia Supreme Court went on to observe that its reasoning is consistent with the concept of civil conspiracy under Georgia law. Whether denoted as “civil conspiracy” or as “joint enterprise”, any situation involving common design where the acts of one are imputed to others creates a situation where the fault resulting from the concerted action is not divisible as a matter of law and, therefore, not subject to apportionment.

The Georgia Supreme Court bolstered its conclusion by noting that the continuing viability of joint and several liability in the situations where fault is not divisible is consistent with the continuing viability of the contribution statute, O.C.G.A. § 51-12-32, which explicitly states that it applies except as provided in Code Section 51-12-33. Contribution continues to apply where joint and several liability applies.

In the context of mediation, whether apportionment or joint and several liability applies could be a critical part of the analysis. The construction of O.C.G.A. § 51-12-33 continues to evolve. We have already been dealing with how much fault might be allocated to the criminal assailant in premises liability cases based on the guidance provided by Couch v. Red Roof Inns, Inc., 291 Ga. 359, 729 S.E.2d 378 (2012). More generally, Couch taught us that “fault” within the meaning of O.C.G.A. § 51-12-33 encompasses not only negligence, but intentioned torts as well. We know, based on the reasoning of Zaldivar v. Prickett, 297 Ga. 589, 774 S.E.2d 688 (2015), that O.C.G.A. § 51-12-33(c) requires the trier of fact to consider the fault of all persons or entities who contributed to the alleged injury or damages, regardless of whether such tortfeasor would have actual liability in tort to the Plaintiff based on a meritorious affirmative defense or claim of immunity such as the exclusive remedy provisions of the Workers’ Compensation Act. The application of the apportionment statute in a strict liability products action was recently addressed by the Georgia Court of Appeals in Suzuki Motor of America, Inc. v. Johns, 351 Ga. App. 186, 830 S.E.2d 549 (2019) (Certiorari granted on January 13, 2020).

Issues relating to apportionment and joint and several liability are often central to the proper assessment of risk in tort cases. Determining whether fault in a particular case is subject to apportionment and, if so, how the apportionment statute is to be applied to the particular facts at issue requires a clear understanding of the applicable analysis based on the most recent cases.

About Roy Paul

Roy Paul, Esq. is a mediator and arbitrator with Miles in Savannah. He has 30+ years of  combined litigation, mediation and arbitration experience. He specializes in business dissolution and business disputes, as well as estate & probate, construction, and personal injury cases. To book Roy for a mediation or arbitration, please call 912-417-2879 or click here.