Prior to 1995 amendments to the state statutes, multiple defendants sued by a plaintiff who were found to be negligent (and whose percentage of liability exceeded the plaintiffs) would be "jointly and severally" liable to the plaintiff. This had the potential for anomalous results. A party who was found to have a very low percentage of liability (even something less than 10%) would find itself responsible for the all of the damages suffered by the plaintiffs. The paradigmatic case would be one in which the party who was found to have the lion's share of the liability had no money.
The amendments changed the law to impose joint and several liability on only those defendants who are found to be more than 50% liable or acted in concert with the other defendants. (If you are wondering what it means to say that a party has a certain percentage of liability, I can't help you. It's a mystery.)
The budget bill - the budget bill - would essentially return us to the pre-1995 state of the law. While the current version of the changes would require a defendant to be found to be 20% liable, that determination apparently only applies to those who have been sued by or settled with the plaintiff. This is a modification of prior law that required all potentially negligent parties (whether they have been sued or not) to have their causal negligence determined.
That modification substantially undermines the limitation on joint and several liability since the problem with the old law tended to result from negligent parties without money. Plaintiffs give up nothing by failing to sue them.
The trial lawyers association says that these anomalous results are rare. They claim that most cases have a single defendant and that the instances of cases in which a defendant with a low percentage of liability had to pay all of the damages are rare. (For a real life example, see Chart v. General Motors)
But that cuts both ways. If these cases are rare, then there is little reason to change the law to allow plaintiffs to recover from such defendants.
The argument for joint and several liability is to ensure that the plaintiff recovers all of her damages (less those that were caused by her own negligence.) That's a laudable goal but it is unclear why it should be furthered by making someone pay for more than the damages that her negligence caused. It is not the plaintiff's fault that she was injured by an insolvent defendant. But its not the fault of the remaining defendants either.
The argument to prefer the plaintiff over solvent defendants is that, as between an injured party and a "wrongdoer," we ought to stick it to the wrongdoer. But there are other considerations. If we hold defendants liable for more than the harm they have caused, we are likely to create incentives for excessive care and cause disproportionate increases in the insurance cost of certain types of businesses.
Those businesses, it seems to me, will be those in which there is a particular risk of harm from failing to control the actions of others. Thus, it makes sense that Jonathan Barry would be particularly concerned about the impact on a ski hill like Tyrol Basin. It faces a peculiar risk of being involved in an incident in which it is apportioned a relatively modest share of liability for an injury caused by an insolvent patron. Because such injuries are hard to predict and potentially catastrophic, insurance may be practically unavailable. If it remains in business, it may have to take extraordinary steps to limit the activities of skiers.
The latter is a problem because it is overdeterrence. It's one thing to make Tyrol Basin responsible for the harm that it causes. Its quite another to make it an insurer of the actions of its patrons.
11 comments:
On your criticism of the common law joint and several law that predated the 1995 changes: "Plaintiffs give up nothing by failing to sue [cash strapped defendants]." Yeah, they do. It's called being subject to the "empty chair" defense. I'm sure you're familiar with it. Defense attorneys target who is not named as a party to the lawsuit and tees off on them.
On the frequency of joint and several liability: "If these cases are rare, then there is little reason to change the law to allow plaintiffs to recover from such defendants." Wrong and ironic. This issue may not come up that often, but when it does crop up it's in a case that has profound implications for the plaintiff (i.e., the plaintiff is stuck with a sizeable tab). This assertion is ironic because the same could be said of the state of affairs in 1995, yet the Republicans nonetheless enacted fundamental change to joint and several liability.
On the consequences of the proposed revision to joint and several liability: "If we hold defendants liable for more than the harm they have caused, we are likely to create incentives for excessive care and cause disproportionate increases in the insurance cost of certain types of businesses." What?? What does "excessive care" mean? It's a given that everyone has to act reasonably to prevent harm to others. Are you seriously concerned about forcing people to act "really reasonably"? And wailing on the tidal increase in insurance premiums is a familiar, but unsubstantiated, cry. There's no proof that insurance premiums went down after the 1995 changes or that they were skyrocketing pre-1995. Heck, when the trial lawyer association tried to introduce insurance premium transparency as part of the recent medical malpractice cap, you can guess how that proposal was met by the insurance alliance.
Without reading into things, the timing of your criticisms is uncanny, since a coalition of naysayers are presently contacting legislators to try to keep what was undone in 1995. Setting aside all the baloney heard from all, the debate over joint and several liability comes down to one fundamental question: as between an injured plaintiff and a defendant who is more at fault, who ought to be stuck with the tab?
Brett
I think you're missing the point and fail to understand the import of the current proposal. Under the law as proposed, the defense lawyers can tee off on the empty chair all they like. It won't help unless they can manage to put it all on them. It is actually under current law that the empty chair defense is likely to work the best since the defendants who are present are less likely to have to pay for whatever is placed on that chair.
Excessive care is not "really reasonable." There are levels of precaution that are irrational. Exposing defendants to liabiltu for more harm than their negligence will cause is likely to overdeter behavior. They will not take reasonable care (that is what would be required to prevent harm reasonably attributed to them), but unreasonable care.
That is not a good thing. Too much caution is just as inefficient as too little.
My point is not that "insurance premiums" in the aggregate would go up (although they might), but that they will go up for certain types of businesses.
Your point about these "rare" cases having profound implications for the plaintiff is balanced by the fact that they will have profound implications for the defendant as well. The defendant will be left with a sizeable tab. Your assumption that paying out damages is just another day at the office is just that - an assumption.
Maybe something should be done for that plaintiff but its not clear that it should be done by gaming the liability system and placing the burden on defendants.
"It is actually under current law that the empty chair defense is likely to work the best since the defendants who are present are less likely to have to pay for whatever is placed on that chair." Right. By lowering the percentage of fault to trigger joint and several, the "empty chair" defense is weakened. That's a good thing. If defendants want to point fingers at another, this gives them an incentive for joinder.
I've never heard of "excessive care" as a bad thing. As an example, safe place law is essentially premised on it. But the idea of extra caution as a distraction strikes me as far fetched. Was the early 1990's the heyday of corporate paralysis over concern of reasonable care? Corporate lawyers will continue to provide flowery advice couched in terms of what is "reasonable to expect" to "probably occur," business will continue to run as always, and WMC will continue to whine. Reasonable care remains the standard regardless of joint and several.
"The defendant will be left with a sizeable tab. Your assumption that paying out damages is just another day at the office is just that - an assumption." True. It is an assumption (as are all of your points, especially your concern about non-insurable interests), but it's also a consequence. Why should an injured plaintiff's fate being balanced by someone found to be guilty? Restitution in a criminal case is not ordered that way.
And gaming the system and burdening defendants? The situations in which joint and several liability is key are no "joke." The burden has already been borne by the plaintiff, and the question is, now what? Tort law is largely premised on a simple theory: the tortfeasor doesn't get the break, and the plaintiff shouldn't be left broken. It's a good theory.
Tourist venues like ski areas and water parks are not the only venues with exposure under the trial bar's proposed changes to joint and several liability. I feel that the trial bar has grossly overreached and is less than truthful both in their description of the scope of the changes being sought and the impact. The way I see it, the trial bar feels that they have paid for these changes and their democratic minions in Jim Doyle and legislative leadership owe them their anticipated fees.
1) The 1995 reforms did indeed lead to a lowering of insurance costs. In my business, the cost of liability insurance dropped by two-thirds from 1996 to today. 2) The 1995 reforms were not 'done by the republicans' as Brett says but rather were themselves a result of a full and transparent legislative process that, in the end, saw 25 democrats voting for the final bill. 2) If these new changes are so good, why not subject them to the same process of open legislative debate as separate legislation? The answer is pretty clear to anyone paying attention: this trial bar attempt to buy the legislation in a budget is being done for the simple reason that it would not pass in this form as a stand-alone bill. 3) These changes take the law far beyond the pre-1995 situation in several ways: a)Combining the fault of all defendants to allow a more at fault plaintiff to sue; b) Excluding parties most at fault in order to fabricate elevated fault levels under the law so as to manipulate the joint and several liability calculation, and; c) Forcing reluctant courts to instruct the jury how the game works.(note that the Wis Judicial Conference-Wisconsin's trial and appellate judges-opposes the jury instruction provisions).
Please spare us this drivel Brett as you must know that these changes are NOT a compromise. In fact, bad as Jim Doyle's initial; budget provision was, Joint Finance amendments (likely written by Keith Clifford of the trial bar and then put into the budget after midnight) create a convoluted scheme, benefiting trial lawyers while creating legal traps never before seen in Wisconsin.
And Brett has the gall to describe us as a "coalition of naysayers trying to keep what was undone in 1995?"
Please instead get your organization to re-group, start being fully truthful, stop trying to buy higher fees in the dark of the night and present your proposals to the full legislature and the public outside of a partisan budget as stand alone legislation where we can all have some meaningful input and perhaps begin to understand the full impacts of a change in joint and several law.
Jonathan,
I appreciate the criticism, I never sought to defend all the particulars of the bill but rather to discuss some points offered by Professor Esenberg. But here's the beginnings of a reaction:
")Combining the fault of all defendants to allow a more at fault plaintiff to sue;" You're mixing apples and oranges. Joint and several has nothing to do with the ability to file a lawsuit.
"b) Excluding parties most at fault in order to fabricate elevated fault levels under the law so as to manipulate the joint and several liability calculation, and;" Sort of true. The empty chair defense is undercut. If defendants want to fingerpoint, they have to bring that other into the lawsuit.
"c) Forcing reluctant courts to instruct the jury how the game works.(note that the Wis Judicial Conference-Wisconsin's trial and appellate judges-opposes the jury instruction provisions)." I fail to see how sunshine is a bad thing. If you're really concerned about trickery on the part of trial lawyers, then tell the jury what could happen if the trial lawyer's theory is believed. Seems to me to be an answer to the problems you pose.
Finally, as for my drivel, I never said the bill was a compromise but rather was an attempt to undo what was done and to restore the balance. Your drivel about "benefiting trial lawyers" is the same automaton refrain whenever law is enacted that protects people. And this measure is about people. In the rare cases when this issue comes up the consequences for the plaintiff are dire. I don't hear anyone else standing up for them.
I find this very interesting and you really put it into perspective in your final statement about making people the insurer of others.
In the case of ski hills and other recreational businesses, could the "recreational activity law" apply to them? I am told it provides protection but I am skeptical of how much.
Brett,
Okay, your tone is good, your discourse lawyerly but you cannot choose your facts nor ignore the process. And please don’t herald that this is about the ‘people’ while ignoring everybody else who will get whacked.
Let’s start with the fact that this issue is not being considered as a bill—it’s a non-fiscal policy item snuck in as part of the state budget. It seems it cannot stand alone. And then you have majority leaders further tilting the playing field to perfect the lottery in the dead of the night.
I’m not myself a lawyer, but I can add and I am able to figure:
There is a vital policy connection between joint/several liability and combining fault to allow a more at fault plaintiff to sue someone less at fault. Under the scheme now before the Assembly, a business that is only 20% at fault can be sued by someone that is up to 50% at fault, and be held jointly and severally liable. Thus, mixing apples and oranges was designed into the law to produce this absurd result. Also recall, those at 20% under the law may be only 1% at fault under facts, as someone who may be most at fault but who cannot be made a party to the suit, say a Chinese manufacturer, is not considered under the scheme.
So the inserted provisions of joint/several liability, combined fault, and not considering the fault of all parties are three distinct policies that are interconnected; sort of a perverse legal version of the whole being greater than the sum of the individual parts. This is a scheme only personal injury lawyers could appreciate, or for that matter conjure up.
And this is being stuffed in a state budget? For whom? You say the ‘people’ and accuse me of “the same automaton refrain” in fingering the trial lawyers. Just follow the money: Jim Doyle collected $245,000 from just one firm. (Dan Bice, Milwaukee Journal-Sentinel) The majority legislative leadership has been similarly cared for. Might that not have something to do with current motive? Can it really be said that the investors have no expectation of a return?
So okay, I’ll stipulate that Jim Doyle might even believe in the merits of this scheme. He, or majority legislators could have introduced separate legislation. They could have embraced the transparency they are wont to tout. There may be a reason to have this debate and let’s please do so, but not just stuffed in a budget and amended with trial bar language well past midnight.
It’s small wonder that very recent polling shows Wisconsinites, by just 13%, agreeing with the notion that our legislators do the public’s business. The rest feel these legislators are in it for themselves or the special interests that pay them.
You claim that this merely “undoes what was done.” That’s simply incorrect as I have explained above. This is a bromide, a falsehood, being peddled by trial bar coat holders right now, as we speak, in the assembly parlor and in pigeon holes outside the Capitol’s North hearing room.
That’s the drivel.
Finally, you herald the straw man that this “measure is about people.” The people also include anybody with some assets: savings, a house, a college fund, some business equity created over a lifetime. Trial attorneys won’t differentiate whose money they will go after. They will go after the money in behalf of their client under the rules as they may exist. And you defend this even when the plaintiff is at greater fault than a defendant?
Anonymous had it spot on: you propose to force me, and anybody who has managed to save something, to become “the insurer of others.”
Jonathan
Ps. The ‘assumption of risk’ statutes, enacted to hopefully provide some protection for ski areas and equine facilities, were largely rendered ineffective by Wisconsin courts. Seems if you charge admission you cannot claim such protection. It would be appropriate to revisit this issue, but I would suggest this would best be done as a separate bill where we could balance the interests at stake
Jonathon said -
"Seems if you charge admission you cannot claim such protection."
Are you talking about the recreational activity law (st.895.52) or some other law? I quickly looked and do not see that type of exemption in this statute.
Anonymous:
Yes, I am referring to Wis Stats ss859.52 and you are correct, there is no mention of any restriction on it's purported protections based upon admission being charged. That exemtion carve out was created by our courts in a case in 1998 against Cascade Mountain. It was a hard fact situation as the ski area did appear (to me) to have liability but the courts went on to differentiate where admission was a factor and, as an appeals court decision, has not to date been changed. It looks as though the legislature would have to restate their specific intent again.
Jonathon wrote -
"It looks as though the legislature would have to restate their specific intent again."
Until that happens do you think a membership or association could be created with a maintenance charge? Or, do you think it would be considered admission?
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