Barton v. Dep't of Transp.

• Court: Washington Supreme Court
• Decided: August 15, 2013
• Docket: 86924-3
• Status: Published

Opinion

Fl LE · . IN CLERKS OFFICE _ SUPREME COURT, STATE OF YtNIIItGTCN DATE AUG 1 5 2013 This opinto~nwas filed for record ~.c.r;.. CHIEF JUsTICE at ~ a. t? ·2.!

IN THE SUPREME COURT OF THE STATE OF WASHINGTON

JARED K. BARTON, a single man, ) ) Respondent, ) No. 86924-3 ) v. ) ENBANC ) STATE OF WASHINGTON, ) DEPARTMENT OF ) TRANSPORTATION, ) ) Petitioner, ) Filed: _ _·A_UG_1_5_2_01_3_ _ ) KORRINE C. LINVOG, individually;) THOMAS LINVOG and ) MADONNA LINVOG, husband ) md~fu, ) ) Respondents. ) ) SKAGIT COUNTY DEPARTMENT ) OF PUBLIC WORKS, ) ) Defendant. ) _________________________) FAIRHURST, J.-This case concerns a partial settlement agreement made

between a plaintiff and some, but not all, defendants in the aftermath of a Barton v. State, No. 86924-3

motorcycle and motor vehicle accident. In the underlying suit, Jared K. Barton

sued Korrine C. Linvog, Korrine's 1 parents, Thomas and Madonna Linvog

(hereinafter the Linvogs ), and the State of Washington. Prior to trial, Barton

executed an agreement with the Linvogs. In the agreement, the Linvogs agreed to

advance Barton $20,000 in exchange for Barton's promise not to execute on a

judgment against them above their insurance policy limits. Neither Barton nor the

Linvogs initially disclosed the agreement to the court or the State. After a 16 day

trial, the jury awarded Barton $3.6 million and the court entered judgment against

the State, Korrine, and the Linvogs. In the process of paying the judgment, the

State learned about the agreement. The State moved to vacate the judgment on the

grounds of fraud and misrepresentation. The trial court denied the motion to vacate

but sanctioned Barton's attorney for failing to disclose the agreement pursuant to

discovery requests. We affirm.

FACTS AND PROCEDURAL HISTORY

Korrine was driving her parents' car when she pulled into an intersection

and collided with Barton, who was approaching the intersection on his motorcycle

with the right of way. Barton suffered serious injuries, including brain damage.

Barton sued Korrine for negligence and sued the Linvogs under the family car

'We refer to Korrine by her first name for sake of clarity. No disrespect is intended. 2 Barton v. State, No. 86924-3

doctrine. Barton also sued the Washington State Department of Transportation

under the theory of negligent highway design and maintenance.

William Spencer, attorney for the Linvogs, offered to settle with Barton for

the limits of the Linvogs' insurance policy-$100,000. Ralph Brindley, Barton's

attorney, refused the settlement offer because he wanted to maintain joint liability

between Korrine, the Linvogs, and the State. However, Brindley apparently told

Spencer that his normal policy was not to pursue claims against individuals in

excess of their insurance policy limits.

Almost two years after the accident occurred, Brindley sought a $20,000

advance from the Linvogs to pay for medical expenses incurred by Barton, who

was uninsured. Spencer, seeing an opportunity to cap the liability of his clients in

the event of a verdict rendered solely against the Linvogs, drafted a document

entitled "Stipulation of Parties Regarding Advanced Payment" (the Stipulation).

Clerk's Papers (CP) at 924-25. The Stipulation provided that the Linvogs (through

their insurance company Mutual of Enumclaw) would pay Barton $20,000 and

such payment would reduce (by $20,000) any future settlement or verdict against

the Linvogs. The Stipulation further provided that Barton "would not execute on

any judgment" he obtained from the Linvogs in excess of their liability insurance.

CP at 925. The Stipulation concluded that "the advance payment does not represent

a settlement of any claims Plaintiff Jared Barton has brought in this matter against

3 Barton v. State, No. 86924-3

Defendants." !d. Brindley signed the Stipulation but it was not signed by anyone

else. Spencer and Brindley did not intend the Stipulation to affect Korrine's

liability to Barton or the State's contribution rights against Korrine or the Linvogs.

Mutual of Enumclaw tendered a $20,000 check to Barton, which he cashed.

Some months earlier, the State had sent discovery requests to Barton and the

Linvogs asking whether the parties had entered into any pretrial settlements,

releases, or agreements. In their initial responses, both Barton and the Linvogs

denied the existence of any such agreement, which was true at the time. After

executing the Stipulation, however, neither Brindley nor Spencer thought to

supplement their answers to the State's requests.

After a 16 day trial, the jury returned a $3.6 million verdict in Barton's

favor. The jury found Korrine 5 percent at fault ($180,000) and the State 95

percent at fault ($3 .42 million). Because the court had earlier granted summary

judgment on the issue of Barton's comparative fault-finding Barton fault free-

Korrine, the Linvogs, and the State were jointly and severally liable for Barton's

injuries. The court entered judgment against Korrine, the Linvogs, and the State.

The State appealed the trial court's evidentiary rulings and the court's

granting of Barton's motion for summary judgment on the issue of comparative

fault. But the Court of Appeals affirmed and remanded. Barton v. State, noted at

147 Wn. App. 1021, 2008 WL 4838687, review denied, 166 Wn.2d 1012, 210 P.3d

4 Barton v. State, No. 86924-3

1018 (2009). After remand, Barton sought to collect his judgment from the

Linvogs and the State. Mutual of Enumclaw paid Barton the balance of the

Linvogs' policy limits-$80,000. Brindley executed a partial satisfaction of

judgment in the amount of $100,000. In the course of discussing the payment of

the judgment with Spencer and Brindley, the State learned about the Stipulation

and obtained a copy of the Stipulation from Spencer.

Soon after learning about the Stipulation, the State filed a motion to vacate

the judgment of the trial court and for new trial and for sanctions. The State alleged

that Barton and the Linvogs' failure to disclose the Stipulation (1) amounted to

fraud and misrepresentation, (2) warranted severe discovery sanctions, (3)

constituted a "Mary Carter" 2 agreement that improperly realigned the interests of

the parties, and (4) resulted in an unfair trial because (a) the State was unable to

cross-examine Korrine to establish bias and (b) the family car doctrine jury

instruction inaccurately stated that the parents were liable for Korrine' s share of

fault. The State deposited its share of the judgment ($3 .42 million) in the registry

of the court, requesting that the funds be held in trust pending the motion to vacate.

The trial court denied the State's motion to vacate. In a detailed

memorandum decision, the trial court found that the failure to disclose the

Stipulation did not prejudice the State and did not affect the outcome of the trial.

2 See Booth v. Mary Carter Paint Co., 202 So. 2d 8 (Fla. Dist. Ct. App. 1967). 5 Barton v. State, No. 86924-3

The trial court found discovery sanctions were warranted for Brindley's failure to

supplement his interrogatory answers (Spencer was not subject to sanctions). The

trial court ordered that Barton would not receive $146,000 in interest that he

otherwise would have been entitled to receive (interest that accrued over the nine

months between the State's depositing the judgment with the court and the release

of the funds to Barton). The State appealed, arguing that the trial court erred by

denying the State's motion to vacate. In an unpublished decision, the Court of

Appeals affirmed the trial court on all grounds. Barton v. State, noted at 164 Wn.

App. 1024,2011 WL 5175599.

The trial court ordered the State to pay Barton's judgment balance

($80,000). The trial court also entered judgment against Korrine and the Linvogs in

favor of the State on its claim for contribution in the amount of $92,632.30

($80,000 plus interest), plus interest at the judgment rate. The State filed a petition

for review, which we granted. Barton v. State, 174 Wn.2d 1008, 278 P.3d 1112

(2012).

ISSUES

A. Does an agreement between a plaintiff and some, but not all, defendants, in which the defendants give the plaintiff an advance payment in exchange for plaintiffs promise not to execute on a judgment in excess of defendants' insurance policy limits, release the defendants so that they are not jointly and severally liable with nonagreeing defendants?

6 Barton v. State, No. 86924-3

B. Did the Stipulation negate Korrine and the Linvogs' contribution liability?

C. Did the trial court abuse its discretion in its choice of sanctions?

ANALYSIS

A. Does an agreement between a plaintiff and some, but not all, defendants, in which the defendants give the plaintiff an advance payment in exchange for plaintiffs promise not to execute on a judgment in excess of defendants' insurance policy limits, release the defendants so that they are not jointly and severally liable with nonagreeing defendants?

We granted review on the State's question of whether the Stipulation

destroyed joint and several liability between the State, Korrine, and the Linvogs.

Ess.entially, the State asks this court to determine whether the Stipulation released

the Linvogs within the meaning of RCW 4.22.060 and .070-a question not

reached by the trial court or the Court of Appeals. The State argues that the

operative legal effect of the Stipulation released the Linvogs, thus destroying joint

and several liability and negating the State's contribution rights. The State argues

that the trial court's failure to accord the Stipulation its operative legal effect was

reversible legal error. After discussing the standard of review and Washington's

joint and several liability scheme as it relates to released parties, we turn to the

question of whether the Stipulation released the Linvogs. We hold that the

Stipulation did not release the Linvogs under RCW 4.22.070; thus, they were

jointly and severally liable for Barton's damages.

7 Barton v. State, No. 86924-3

Standard of Review. We generally review a trial court's decision on a motion

to vacate for abuse of discretion. Haley v. Highland, 142 Wn.2d 135, 156, 12 P.3d

119 (2000). In this case, however, we granted review to determine whether the

Stipulation destroyed joint liability under RCW 4.22.070(1 ), which requires the

court to define the term "release" as used in that statute. We review issues of

statutory interpretation and alleged errors of law de novo. Jongeward v. BNSF Ry.,

174 Wn.2d 586, 592, 278 P.3d 157 (2012) (citing State v. Breazeale, 144 Wn.2d

829,837,31 P.3d 1155 (2001)).

1. Under Washington's joint and several liability scheme, a "released' defendant is not jointly and severally liable and is not liable for contribution to other defendants against whom judgment is entered

To understand the issue presented by this case, it is necessary to briefly

outline Washington's joint and several liability scheme. Generally, when multiple

tortfeasors cause a plaintiffs injuries, each tortfeasor is liable only for damages

corresponding to its proportionate share of fault as determined by the trier of fact.

RCW 4.22.070(1 ). However, when multiple tortfeasors are responsible for a

plaintiffs injuries, and the plaintiff is zero percent at fault, tortfeasors against

whom judgment is entered are jointly and severally liable for the sum of their

proportionate shares ofthe plaintiffs damages. RCW 4.22.070(1)(b).

A plaintiff must obtain a judgment against each defendant before multiple

defendants are jointly and severally liable. Gerrard v. Craig, 122 Wn.2d 288, 298,

8 Barton v. State, No. 86924-3

857 P .2d 1033 (1993). "Settling parties, released parties, and immune parties are

not parties against whom judgment is entered and will not be jointly and severally

liable under RCW 4.22.070(1)(b)." Kottler v. State, 136 Wn.2d 437, 447, 963 P.2d

834 (1998) (citing Washburn v. Beatt Equip. Co., 120 Wn.2d 246, 294, 840 P.2d

860 (1992); Anderson v. City of Seattle, 123 Wn.2d 847, 852, 873 P.2d 489 (1994)

(A released party "cannot under any reasonable interpretation of RCW

4.22.070(1)(b) be a defendant against whom judgment is entered.")).

A joint and severally liable defendant who pays more than his or her

proportionate share may seek contribution from another defendant against whom

judgment has been entered pursuant to RCW 4.22.040, .050, and .060. RCW

4.22.070(2). But joint and several liability must exist before a defendant has a right

to contribution from another defendant. "Contribution is conditioned on the

existence of joint and several liability because absent such common joint and

several liability one party will have no duty to pay another's liability for damages

and, thus, no cause for subsequent reimbursement." Kottler, 136 Wn.2d at 442.

Since "released" tortfeasors cannot be jointly and severally liable with nonreleased

tortfeasors, released tortfeasors are not liable for contribution.

9 Barton v. State, No. 86924-3

2. A plaintiff who executes a settlement device listed in RCW 4.22. 060 with some, but not all, defendants, does not necessarily "release" a defendant under RCW 4.22. 070

Washington's comparative fault statutes, chapter 4.22 RCW, do not define

"release." "Our fundamental purpose in construing statutes is to ascertain and carry

out the intent of the legislature." In reMarriage of Schneider, 173 Wn.2d 353, 363,

268 P.3d 215 (2011) (citing Lake v. Woodcreek Homeowners Ass 'n, 169 Wn.2d

516, 526, 243 P.3d 1283 (2010)). "We determine the intent of the legislature

primarily from the statutory language." Id. (citing Lacey Nursing Ctr. v. Dep't of

Revenue, 128 Wn.2d 40, 53, 905 P.2d 338 (1995)). "In the absence of ambiguity,

we will give effect to the plain meaning of the statutory language." Id. (citing

TracFone Wireless, Inc. v. Dep't of Revenue, 170 Wn.2d 273, 281, 242 P.3d 810

(2010)).

The term "release" is not ambiguous. The plain meaning of "release" is the

"surrender of a claim, which may be given for less than full consideration, or even

gratuitously." DeNike v. Mowery, 69 Wn.2d 357, 366, 418 P.2d 1010, 422 P.2d

328 (1966); see also BLACK'S LAW DICTIONARY 1403 (9th ed. 2009) (defining

"release" as "[l]iberation from an obligation, duty, or demand; the act of giving up

a right or claim to the person against whom it could have been enforced"); W.

PAGE KEETON ET AL., PROSSER AND KEETON ON THE LAW OF TORTS 332 (5th ed.

1984) ("a release is a surrender of the cause of action, which may be gratuitous, or

10 Barton v. State, No. 86924-3

given for inadequate consideration"); WARREN FREEDMAN, JOINT AND SEVERAL

LIABILITY: ALLOCATION OF RISK AND APPORTIONMENT OF DAMAGES 70 (1987) (a

release is "a surrender of the cause of action, gratuitously or for some

consideration").

The State advocates for a different interpretation of RCW 4.22.070(1) and

the term "release." The State points out that RCW 4.22.060, the statute governing

the effect of settlement agreements, also uses the term "release." RCW 4.22.060(1)

requires notice and court approval of "a release, covenant not to sue, covenant not

to enforce judgment, or similar agreement." RCW 4.22.060(2) discharges the

contribution liability of one who obtains a "release, covenant not to sue, covenant

not to enforce judgment, or similar agreement." The State reads RCW 4.22.060

together with RCW 4.22.070 to conclude that a defendant who is a party to "a

covenant not to sue," "a covenant not to enforce judgment," or "similar agreement"

is "released" under RCW 4.22.070(1 ).

The State's argument is not without merit. The Court of Appeals has read

RCW 4.22.060 together with RCW 4.22.070 to conclude that when a defendant

enters into "a release, covenant not to sue, covenant not to enforce judgment, or

similar agreement," RCW 4.22.060, then the defendant is "released" under RCW

4.22.070(1). See Maguire v. Teuber, 120 Wn. App. 393, 396, 85 P.3d 939 (2004)

("Read as a whole, this statute suggests that releases, covenants and similar

11 Barton v. State, No. 86924-3

agreements all constitute 'releases' for purposes of determining who had been

'released' under RCW 4.22.070." (footnote omitted)); Romero v. W. Valley Sch.

Dist., 123 Wn. App. 385, 387, 98 P.3d 96 (2004) (adopting the analysis from

Maguire).

The Maguire court based its holding, in part, on the opinion of Washington

law review articles that speculated that a "covenant not to sue, covenant not to

enforce judgment, or similar agreement," RCW 4.22.060, would release

covenanting parties under RCW 4.22.070. See, e.g., J. Michael Philips, Looking

out for Mary Carter: Collusive Settlement Agreements in Washington Tort

Litigation, 69 WASI-l. L. REv. 255, 273-74 (1994) ("The language ofthe 1986 Tort

Reform Act and its interrelationship with the 'effects of settlement' statute suggest

that the legislature intended Mary Carter-type agreements to be treated as

settlements." (footnote omitted) (citing RCW 4.22.070, .060)); Cornelius J. Peck,

Reading Tea Leaves: The Future of Negotiations for Tort Claimants Free from

Fault, 15 U. PUGET SOUND L. REV. 335, 344 (1991-92) ("a court will treat a

contract not to execute as a release or settlement under RCW 4.[22].070");

Gregory C. Sisk, Interpretation of the Statutory Modification of Joint and Several

Liability: Resisting the Deconstruction of Tort Reform, 16 U. PUGET SOUND L.

REV. 1, 50 (1992-93) (citing Peck, supra). The commentators were concerned that

12 Barton v. State, No. 86924-3

litigants would use these settlement devices to falsely manufacture joint and

several liability.

We disagree with the Maguire court's interpretation of RCW 4.22.070

because it does not account for the plain, unambiguous meaning of the term

"released." The Maguire court, rather than determining the plain meaning of

"released" in RCW 4.22.070, looked solely to "closely related statutes" to ascertain

"the underlying legislative purpose" and concluded that all settlement devices

listed in RCW 4.22.060 have the effect of "releasing" a defendant under RCW

4.22.070. Maguire, 120 Wn. App. at 396 (citing Gallo v. Dep 't of Labor & Indus.,

119 Wn. App. 49, 54, 81 P.3d 869 (2003)); see also David Beninger & Joel

Cunningham, Settlement Agreements: Are Lions Now Tigers and Bears (Oh My)?,

TRIAL NEWS, Jan. 2006, at 5 (suggesting that the Maguire court used a

"grammatical trick" to equate the types of settlement devices listed in RCW

4.22.060 to the term "released" in RCW 4.22.070). By not considering the plain

meaning of the term "release," the Maguire court erroneously equated a "covenant

not to sue, covenant not to enforce judgment, or similar agreement," RCW

4.22.060, to complete "releases."

The Maguire court also thought its interpretation of RCW 4.22.070 was

"consistent with case law," specifically Kottler and Shelby v. Keck 85 Wn.2d 911,

541 P.2d 365 (1975). Maguire, 120 Wn. App. at 397. As discussed in the following

13 Barton v. State, No. 86924-3

section, we do not find that these cases mandate the result reached by the Maguire

court. The Maguire court failed to take into account the fact that Washington

courts have enforced partial, pretrial settlement devices that do not completely

release a covenanting defendant. For instance, Washington courts have found that

covenants not to sue, 3 covenants not to execute JU gment, 4 andl oan rece1pt 'd .

agreements 5 do not necessarily "release" a defendant.

3 Under the common law, the release of one defendant released all other defendants, regardless if there was a full satisfaction of the claim. Scott I. Anderson, Contribution Among Tort-Feasors in Washington: The 1981 Tort Reform Act, 57 WASH. L. REV. 479, 493 (1982) (citing cases). In order to avoid this harsh common law rule, parties began executing covenants not to sue. "While a release relinquishes all rights to a claim against another party, the covenant not to sue retains those rights and grants a promise not to enforce them." FREEDMAN, supra, at 81; see also 1 SETTLEMENT AGREEMENTS IN COMMERCIAL DISPUTES: NEGOTIATING, DRAFTING & ENFORCEMENT § 9.04, at 9-22 (RICHARD A. ROSEN ED., 2008) ("A covenant not to sue does not relinquish any claims, but rather constitutes an agreement not to initiate litigation against specific parties."). Prior to tort reform, Washington courts consistently distinguished covenants not to sue from releases. See, e.g., Mills v. Inter Island Tel. Co., 68 Wn.2d 820, 829, 416 P.2d 115 (1966) (holding covenant not to sue did not release a joint tortfeasor where there is no double recovery); Haney v. Cheatham, 8 Wn.2d 310,322, 111 P.2d 1003 (1941) (under the common law rule, a covenant not to sue releases a covenanting defendant when the defendant reasonably compensates the plaintiff); Richardson v. Pac. Power & Light Co., 11 Wn.2d 288,317, 118 P.2d 985 (1941) (whether an agreement is a release or a covenant not to sue depends on the consideration exchanged, the effect of the agreement, and the circumstances attending its execution); but see Monjay v. Evergreen Sch. Dist. No. 114, 13 Wn. App. 654, 659, 537 P.2d 825 (1975) ("A covenant not to sue will be treated as a release of all tort-feasors if reasonably compensatory consideration has been paid by one or more tort-feasors to the plaintiff."). 4 A covenant not to levy execution or covenant not to execute "is a device that does not interfere with plaintiff securing the judgment, at least in the eyes of all other tortfeasors." FREEDMAN, supra, at 83. In the insurance context, "A covenant not to execute coupled with an assignment and settlement agreement does not release a tortfeasor from liability; it is simply 'an agreement to seek recovery only from a specific asset-the proceeds of the insurance policy and the rights owed by the insurer to the insured.'" Beset v. Viking Ins. Co. of Wis., 146 Wn.2d 730, 737,49 P.3d 887 (2002) (quoting Safeco Ins. Co. ofAm. v. Butler, 118 Wn.2d 383, 399, 823 P.2d 499 (1992)). 5 A loan receipt agreement is "a lawful arrangement by which the insurer advances to its insured the amount of a covered loss as a loan, repayable only and to the extent that the insured 14 Barton v. State, No. 86924-3

Despite the State's arguments to the contrary, we find such settlement

devices tend to further the underlying policies of the tort reform act of 1981,

chapter 4.22 RCW. See Jensen v. Beaird, 40 Wn. App. 1, 10, 696 P.2d 612 (1985)

(partial settlement devices "encourage out-of-court settlements, help solve the

economic needs of an injured person confronted with the delays in the court

system, and ... simplify complex multiparty litigation"). In particular, partial

settlement devices encourage tortfeasors "to place a substantial sum of money at

[their] victim's disposal, with the possibility of no recoupment," when "the injured

party . . . might otherwise have to wait several years while prolonged and varied

court battles are waged." Id. The Maguire court's interpretation of RCW 4.22.070

ignores precedent distinguishing partial settlement devices from releases and

interferes with a plaintiff's ability to settle his or her claims.

We hold the execution of a "covenant not to sue, covenant not to enforce

judgment, or similar agreement," RCW 4.22.060, does not necessarily "release" a

defendant under RCW 4.22.070. We find the Maguire court's analysis flawed

because the Court of Appeals ignored the plain meaning of "release," failed to

distinguish between releases and other partial settlement agreements, and reached a

obtains a net recovery from others also liable." US. Oil & Ref Co. v. Lee & Eastes Tank Lines, Inc., 104 Wn. App. 823, 832, 16 P.3d 1278 (2001); DAVID K. DEWOLF & KELLER W. ALLEN, 16 WASHINGTON PRACTICE: TORT LAW AND PRACTICE§ 12.49 (2012). This type of agreement "has been upheld in almost all the cases." Monjay, 13 Wn. App. at 660 n.3 (citing Claw v. Nat'l Indem. Co., 54 Wn.2d 198, 339 P.2d 82 (1959)); see also Jensen v. Beaird, 40 Wn. App. 1, 10, 696 P.2d 612 (1985); Bolton v. Zeigler, 111 F. Supp. 516 (N.D. Iowa 1953). 15 Barton v. State, No. 86924-3

result that interferes with a plaintiffs ability to settle his or her claims. To the

extent that the Court of Appeals analyzed RCW 4.22.070 together with .060 in

Maguire and Romero, those cases are overruled. However, as discussed in the

following section, the holdings of Maguire and Romero remain intact because

reading RCW 4.22.070 together with .060 was not necessary to the outcome of

those cases.

In summary, we reject the State's argument that the Stipulation-essentially

a covenant not to execute judgment-had the operative legal effect of releasing the

Linvogs. We are mindful that partial settlement devices executed between

plaintiffs and some, but not all, defendants pose the risk of collusion between

parties. But we find that the requirements of disclosure and reasonableness

hearings sufficiently address these concerns. Furthermore, we find that partial

settlement devices do not undermine the tort reform act because they encourage

out-of-court settlements and speedy compensation to injured victims. In the

following section, we apply traditional principles of contract interpretation to

determine whether the Stipulation "released" the Linvogs under RCW 4.22.070.

3. Pretrial, partial settlement agreements should be interpreted under traditional principles of contract interpretation

Barton and the Linvogs argue that the Stipulation should be given the effect

that the parties intended. We agree. We hold that the Stipulation did not release the

Linvogs because Barton and the Linvogs did not intend the Stipulation to release 16 Barton v. State, No. 86924-3

the Linvogs. Like the trial court and the Court of Appeals, we do not analyze issues

of contract formation or defenses to enforcement (i.e., impossibility, mutual

mistake, contrary to public policy) because the parties do not address these issues.

"A release is a contract and its construction is governed by contract

principles subject to judicial interpretation in light of the language used."

Nationwide Mut. Fire Ins. Co. v. Watson, 120 Wn.2d 178, 187, 840 P.2d 851

(1992); see also Del Rosario v. Del Rosario, 152 Wn.2d 375, 382, 97 P.3d 11

(2004) ("This court has consistently held that personal injury releases are contracts

governed by contract principles."); 1 SETTLEMENT AGREEMENTS IN COMMERCIAL

DISPUTES: NEGOTIATING, DRAFTING & ENFORCEMENT § 9.01 [B], at 9-3 (RICHARD

A. RoSEN ED., 2008) ("Because releases are contracts, contract law governs the

formation and interpretation of releases.") (hereinafter SETTLEMENT AGREEMENTS).

"A court's primary task in interpreting a written contract is to determine the intent

of the parties." United States Life Credit Ins. Co. v. Williams, 129 Wn.2d 565, 569,

919 P.2d 594 (1996); see also Mills v. Inter Island Tel. Co., 68 Wn.2d 820, 829,

416 P.2d 115 (1966) ("[T]he distinction between a covenant not to sue and a

release will be preserved according to the intention of the parties."); 1 SETTLEMENT

AGREEMENTS, supra, § 9.03[A], at 9-19 (if a release is ambiguous, "the court will

proceed to consider the intent of the parties"). In determining whether the partial

17 Barton v. State, No. 86924-3

settlement agreement releases a covenanting defendant, Washington courts have

explicitly, or implicitly, looked to the intent of the parties to resolve ambiguity.

In Shelby, Gary Keck accidently shot and killed Verna Shelby in a tavern,

and Shelby's estate sued Keck and the restaurant that had served alcohol to Keck

prior to the shooting. 85 Wn.2d at 912. Keck reached an agreement with Shelby's

estate where Keck's insurance company paid the estate $25,000-Keck's

insurance policy limits-and the estate agreed not to execute on a judgment against

Keck. Id. The trial court granted the restaurant's motion to dismiss Keck from the

lawsuit. Id. at 912-13. This court affirmed Keck's dismissal. Id. at 917. We noted

the parties intended the agreement to be a "binding settlement" that left "no

justiciable issue to be resolved between [the] parties." Id. at 918. In other words,

we found that the estate intended to completely release Keck in exchange for his

payment of $25,000.

In Maguire, John Maguire sued Steven Teuber after Teuber rear-ended

Maguire's car. 120 Wn. App. at 394. Maguire also sued the State-for faulty

highway design-and the owner of the car, William Hadsall. Id. Maguire executed

an agreement with Teuber and Hadsall where they agreed to pay Maguire

$1 00,000-their insurance policies limits-and Maguire promised not to execute a

judgment against either Teuber or Hadsall. Id. After disclosure of the agreement,

18 Barton v. State, No. 86924-3

the State moved to dismiss Teuber and Hadsall but the trial court denied the State's

motion.

The Court of Appeals reversed, holding ( 1) the covenant not to execute

"released" Teuber and Hadsall under RCW 4.22.070, (2) the trial court erred in

entering judgment against Teuber and Hadsall, and (3) the trial court erred in

dismissing Teuber and Hadsall. Maguire, 120 Wn. App. at 399. In holding that the

agreement released Teuber and Hadsall, the Court of Appeals reasoned that the

agreement was "'intended to constitute a complete resolution of all claims."' I d. at

397-98, 399 (quoting covenant not to execute). Above, we held that the Maguire

court erred by analyzing RCW 4.22.070 together with .060 to conclude that the

covenant not to execute "released" Teuber and Hadsall. Nevertheless, the Maguire

court properly held that the agreement released Teuber and Maguire because the

parties intended the agreement to be a "complete resolution of all claims." ld. at

397-98, 399.

In Romero, Michael and Carrie Romero sued the West Valley School

District for negligence after a vehicle struck and killed the Romeros' young child

in the school load and unload zone. 123 Wn. App. at 387. Mr. Romero and the

child's estate cross-claimed against Ms. Romero, who had been responsible for

picking the child up from school. ld. Mr. Romero and the child's estate executed

an agreement with Ms. Romero with the following terms:

19 Barton v. State, No. 86924-3

Ms. Romero agreed to pay the limits of her automobile insurance and $5,000. Mr. Romero and the estate agreed that if they obtained a judgment of more than $30,000 against the District, they would reimburse Ms. Romero $1 for every $2 they collected from the District over the $30,000 amount, up to $5,000. They also agreed that Ms. Romero would remain in the suit as a defendant. But Mr. Romero and the estate would not execute on any judgment obtained against her.

Id. at 388. The parties submitted the agreement to the trial court, which found the

agreement reasonable. Id. After trial, the jury found the school district 75 percent

responsible for the Rom eros' damages and Ms. Romero 25 percent responsible. Id.

at 389. The trial court entered judgment against the school district and Ms.

Romero.

The Court of Appeals-relying on Maguire-held that the agreement

"released" Ms. Romero. The Court of Appeals reversed the judgment so that the

school district was not jointly and severally liable for Ms. Romero's share of fault.

Id. at 392. The Court of Appeals found that the agreement was a "classic 'Mary

Carter' agreement" that was made for the purpose of "avoid[ing] the 'several'

liability scheme." Id. at 389-90. The Court of Appeals concluded "the intended

result [of the agreement] is contrary to the letter and spirit of the tort reform act."

Id. at 392.

In the present case, the Stipulation did not have the effect of releasing the

Linvogs because the parties did not intend the Stipulation to release the Linvogs.

Barton has consistently argued that he did not intend to release either Korrine or 20 Barton v. State, No. 86924-3

Linvogs. The Linvogs have consistently taken the position that they believed they

remained liable for Korrine' s proportionate share of fault above the Linvogs'

insurance policy limits. Neither Barton nor the Linvogs intended the Stipulation to

negate the State's right to seek contribution from the Linvogs. The trial court

found, "Plaintiffs counsel and Linvogs' counsel believed the agreement was valid

and enforceable on these terms." CP at 9.

Shelby, Maguire, and Romero each involved a settlement agreement that

released the covenanting defendant or defendants. These cases can be distinguished

from the case at bar.

Unlike the parties in Shelby, Barton and the Linvogs did not intend to make

a "binding settlement" that left "no justiciable issue to be resolved between [the]

parties." 85 Wn.2d at 918. The Stipulation expressly stated that it "[did] not

represent a settlement of any claims" between Barton and any defendants. CP at

925. Also, despite the execution of the Stipulation, justiciable issues remained

concerning the Linvogs' liability to Barton. The State could still seek contribution

from the Linvogs and the Linvogs' liability to Barton could have been anywhere

from $20,000 to $100,000. Shelby is distinguishable from the case at bar.

In Maguire, the Court of Appeals found that the agreement between

Maguire, Teuber, and Hadsall constituted a "complete resolution of all claims."

120 Wn. App. at 397-98. In this case, the parties did not intend to make a complete

21 Barton v. State, No. 86924-3

resolution of Barton's claims against the Linvogs. The Maguire agreement

contained "release language." Id. at 398. The Stipulation in this case does not.

Romero can be distinguished by the fact that it involved a "classic 'Mary

Carter' agreement" that sought to avoid Washington's several liability scheme in

contrast to the "letter and spirit of the tort reform act." 123 Wn. App. at 392. The

Stipulation is not a Mary Carter agreement. 6 In fact, it is more like a high-low

agreement, a type of partial settlement agreement that has been approved in other

jurisdictions. 7 We agree with the trial court that the Stipulation did not realign the

interests of the parties or attempt to artificially manufacture joint and several

liability between an individual and- a deep pocket institutional defendant. The

6 A Mary Carter agreement is a settlement device that generally contains three basic provisions: (1) "the settling defendant guarantees the plaintiff a minimum payment, regardless of the court's judgment;" (2) "the plaintiff agrees not to enforce the court's judgment against the settling defendant;" and (3) "the settling defendant remains a party in the trial, but his exposure is reduced in proportion to any increase in the liability of his codefendants over an agreed amount." John E. Benedict, It's a Mistake To Tolerate the Mary Carter Agreement, Note, 87 COLUM. L. REV. 368, 369-70 (1987). Some agreements might also require that "the agreement be kept secret between the settling parties." Id. at 370. The name "Mary Carter agreement" is taken from the first case to analyze these types of settlement devices, Booth v. Mary Carter Paint Co. The Stipulation is not a Mary Carter agreement because the third element is not met. Since this case does not involve a Mary Carter agreement, we will wait until this issue is squarely presented to rule on the validity of such agreements in Washington. 7 In a high-low agreement, the covenanting defendant promises to pay plaintiff a minimum amount, regardless of the verdict, but defendant's liability is capped at an agreed upon maximum amount. See, e.g., Ziegler v. Wendel Poultry Servs., Inc., 67 Ohio St. 3d 10, 615 N.E.2d 1022, 1029-30 (1993) (high-low settlement agreement was valid because the settling defendant still had an incentive to keep the amount of damages down), overruled on other grounds by Fidelholtz v. Peller, 1998-0hio-462, 81 Ohio St. 3d 197, 690 N.E.2d 502, 505; Hodesh v. Korelitz, 2009-0hio-4220, 123 Ohio St. 3d 72, 914 N.E.2d 186, 190 (relying on Ziegler). 22 Barton v. State, No. 86924-3

State's right to seek contribution was not affected. In short, the Stipulation does not

present the same concerns as the agreement in Romero.

In conclusion, the Stipulation did not release the Linvogs; therefore, they

were jointly and severally liable with the State for Barton's damages. The trial

court and Court of Appeals denied the State's motion to vacate on the grounds that

the State was not prejudiced by the Stipulation. At the State's request, we granted

review on the question of whether the Stipulation released the Linvogs under RCW

4.22.070. We hold that it did not.

B. Did the Stipulation negate Korrine and the Linvogs' contribution liability?

In its petition for review, the State argues, "RCW 4.22.060(2) mandates that

a covenant not to execute negates contribution liability." Pet. for Review at 4. The

State further asks, "Can a covenant not to execute be written in a way so that it

does not negate contribution liability?" ld. Above, we held that the Stipulation did

not release the Linvogs because the parties did not intend to completely release

them. The Linvogs were jointly and severally liable with the State for Barton's

damages. Accordingly, judgment was entered against the Linvogs. It follows that

the State's right to seek contribution from the Linvogs was preserved. Without

accepting the State's invitation to rule on whether a covenant not to execute will

always negate contribution rights, we hold that the Stipulation in this case did not

negate the State's contribution rights.

23 Barton v. State, No. 86924-3

A joint and severally liable defendant who pays more than his proportionate

share may seek contribution from another defendant against whom judgment has

been entered pursuant to RCW 4.22.040, .050, and .060. RCW 4.22.070(2). "[I]t is

well to observe that it is not easy to find a procedural mechanism whereby a

settling defendant could be certain that claims of contribution and/or indemnity

would be cut off as part of the settlement with the plaintiff." FREEDMAN, supra, at

73.

In this case, the State, Korrine, and the Linvogs were jointly and severally

liable for Barton's injuries. The trial court entered judgment against the defendants.

The State paid more than its proportionate share of Barton's damages and obtained

a contribution judgment against the Linvogs. RCW 4.22.060(2) seeks to protect

released or covenanting defendants from contribution claims brought by other

defendants who did not settle with the plaintiff. The Linvogs did not seek to hide

behind the protections of RCW 4.22.060(2) but instead recognized their obligation

to pay the State's contribution claim. After collecting contribution from the

Linvogs, the State will have only paid its share of fault as assigned by the jury. The

Stipulation did not negate the State's right to contribution against the Linvogs.

C. Did the trial court abuse its discretion in its choice of sanctions?

The State argues that Barton and the Linvogs' failure to disclose the

Stipulation pursuant to discovery rules and RCW 4.22.060, merits serious

24 Barton v. State, No. 86924-3

sanctions such as a new trial. We disagree and hold that the trial court did not

abuse its discretion in sanctioning Barton.

Standard of review. We review a trial court's order of sanctions for abuse of

discretion. Rivers v. Wash. State Conference of Mason Contractors, 145 Wn.2d

674, 684, 41 P.3d 1175 (2002). '"[D]iscretionary determination should not be

disturbed on appeal except on a clear showing of abuse of discretion, that is,

discretion manifestly unreasonable, or exercised on untenable grounds, or for

untenable reasons."' I d. at 684-85 (alteration in original) (internal quotation marks

omitted) (quoting Burnet v. Spokane Ambulance, 131 Wn.2d 484, 494, 933 P.2d

1036 (1997)). "The abuse of discretion standard ... recognizes that deference is

owed to the judicial actor who is 'better positioned than another to decide the issue

in question."' Wash. State Physicians Ins. Exchange & Ass'n v. Fisons Corp., 122

Wn.2d 299, 339, 858 P.2d 1054 (1993) (internal quotation marks omitted) (quoting

Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 403, 110 S. Ct. 2447, 110 L. Ed.

2d 359 (1990). We give wide latitude to a trial court in fashioning an appropriate

sanction for discovery abuse. Id. at 339.

Analysis. Generally, "the court may impose only the least severe sanction

that will be adequate to serve its purpose in issuing a sanction." Teter v. Deck, 17 4

Wn.2d 207, 216, 274 P.3d 336 (2012). To support imposition of one of the greater

sanctions-such as a new trial-the record must clearly show (1) one party

25 Barton v. State, No. 86924-3

willfully or deliberately violated the discovery rules and orders, (2) the opposing

party was substantially prejudiced in its ability to prepare for trial, and (3) the trial

court explicitly considered whether a lesser sanction would have sufficed. Magana

v. Hyundai Motor Am., 167 Wn.2d 570, 584, 220 P.3d 191 (2009) (citing Burnet,

131 Wn.2d at 494). The purposes of sanctions are to deter, punish, compensate,

educate, and ensure that the wrongdoer does not profit from the wrong. Fisons, 122

Wn.2d at 356.

The State is correct in arguing that Barton and the Linvogs' failure to

disclose the Stipulation violated RCW 4.22.060(1) and CR 26(e)(2). RCW

4.22.060(1) requires that a party, "prior to entering into a release, covenant not to

sue, covenant not to enforce judgment, or similar agreement," shall give notice of

the settlement to the court and other parties and the court shall hold a hearing to

determine whether the settlement was reasonable. The statute does not set forth

any consequences for failing to disclose. CR 26( e)(2) requires parties to

"seasonably" amend or supplement discovery requests. Under CR 26(e)(4), failure

to comply with CR 26(e)(2) "will subject the party to such terms and conditions as

the trial court may deem appropriate." CR 37 "sets forth the rules regarding

sanctions when a party fails to make discovery." Magana, 167 Wn.2d at 583-84.

"CR 37(d) authorizes a court to impose the sanctions in CR 37(b)(2), which range

26 Barton v. State, No. 86924-3

from exclusion of evidence to granting default judgment when a party fails to

respond to interrogatories and requests for production." !d. at 584.

Barton and the Linvogs concede that they failed to comply with the

disclosure requirements of RCW 4.22.060 and failed to supplement their responses

to the State's discovery requests. But the trial court found that the parties' failure to

disclose the Stipulation was not willful or deliberate and the State's ability to

prepare for trial was not substantially prejudiced. The trial court sanctioned Barton

and Brindley by not requiring the State to pay $146,000 in interest the State

otherwise would have owed to Barton. This is a significant sanction. The State has

not made any showing that the severe sanctions it has requested are justified. We

hold that the trial court did not abuse its discretion in sanctioning Barton and

Brindley.

CONCLUSION

We hold that the Stipulation did not release the Linvogs under RCW

4.22.070. The Linvogs were jointly and severally liable with the State for Barton's

damages. The Stipulation did not affect the State's right to contribution against the

Linvogs. The trial court did not abuse its discretion in sanctioning Brindley and

Barton. We affirm the Court of Appeals.

27 Barton v. State, No. 86924-3

WE CONCUR:

28 Barton v. State, Dep 't ofTransp., et al.

No. 86924-3

MADSEN, C.J. (concurring/dissenting)-The majority's analysis is based on an

incorrect assumption about the nature of the "Stipulation" (hereafter "agreement")

between plaintiff Jared Barton and Thomas and Madonna Linvog (the Linvogs), the

parents of Korrine Linvog (Korrine ). The majority incorrectly assumes that the

agreement falls within the scope ofRCW 4.22.060. In addition, the majority seems to

accept the State's contention that if the agreement released the Linvogs, joint and several

liability was destroyed and the State should have been only severally liable for damages

due to its own fault. However, Korrine was not a party to the agreement and she

remained liable for damages attributed to her fault. Regardless of whether the Linvogs

were released, joint and several liability remained because Korrine was jointly and

severally liable for 100 percent of the damages suffered.

Parties can enter agreements that partially settle some claims without invoking

RCW 4.22.060, and that is what occurred here. Since the agreement did not eliminate the

Linvogs' liability for contribution, it was not the type of agreement that falls within RCW

4.22.060. No. 86924-3 Madsen, C.J. (concurring/dissenting)

Since this agreement is not a covenant not to enforce judgment as that term is used

in RCW 4.22.060, it is not necessary in this case to decide whether a document that does

fall within this statute is a release that also acts to release the party from joint and several

liability under RCW 4.22.070. But if an agreement does fall within the scope ofRCW

4.22.060 and settles the claims between the parties, the court should hold that it acts as a

release for purposes ofRCW 4.22.070. This conclusion follows from the plain language

ofRCW 4.22.060 and the interrelationship between RCW 4.22.060 and .070.

Finally, since RCW 4.22.060 is not applicable, the trial court abused its discretion

in awarding sanctions for violation of the notice requirement in the statute. It follows that

the State's request for more severe sanctions under the statute should be denied.

Discussion

Nature of the Linvogs' and Korrine 's Liability

It is important to understand the nature of the defendants' potential liability in this

case. Under the family car doctrine, Thomas and Madonna Linvog were exposed to

liability for their daughter Korrine's negligence in causing the injuries suffered by the

plaintiff, Jared Barton. The Linvogs 1 potential liability arose "based on agency

principles; that is, members of the family who are permitted to drive the automobile are

agents of the owners." 16 DAVID K. DEWOLF & KELLER W. ALLEN, WASHINGTON

PRACTICE: TORT LAW AND PRACTICE§ 3.23, at 139 (3d ed. 2012); see Coffman v.

McFadden, 68 Wn.2d 954, 958, 416 P.2d 99 (1966) ("[a] parent is not liable for the torts

1 For clarity, I refer to Thomas and Madonna Linvog as "the Linvogs," and to Korrine Linvog as "Korrine." 2 No. 86924-3 Madsen, C.J. (concurring/dissenting)

of his child solely because of the relationship ... liability, if any exists, must rest upon

the relation of agency or service"). It does not arise when the parents of the driver neither

own nor control the vehicle. 16 DEWOLF & ALLEN, supra,§ 3.23, at 139.

This type of liability comes within RCW 4.22.070(1)(a), which provides that

"[t]he liability of each defendant shall be several only and shall not be joint except ... [a]

party shall be responsible for the fault of another person or for payment of the

proportionate share of another party ... when a person was acting as an agent or servant

of the party." By the references to "party," this subsection contemplates that Korrine's

parents had to be parties to the suit for this liability to arise. That is, unless the Linvogs

remained as parties in the action, they would not be liable to the plaintiff for damages

arising from Korrine's negligence.

Korrine's potential liability, on the other hand, falls within RCW 4.22.070(1)(b),

which provides for joint and several liability when the plaintiff is fault free?

The parties' agreement did not "destroy" joint and several liability

The agreement says that the parties agreed and stipulated that the Linvogs' insurer

had paid $20,000 to Barton as an advance payment against any future settlement or

verdict obtained against the "Defendants Korinne Linvog [and] her parents, Thomas and

2 RCW 4.22.070 provides: (1) ... The liability of each defendant shall be several only and shall not be joint except:

(b) If the trier of fact determines that the claimant or party suffering bodily injury or incurring property damages was not at fault, the defendants against whom judgment is entered shall be jointly and severally liable for the sum of their proportionate shares of the claimants [claimant's] total damages. 3 No. 86924-3 Madsen, C.J. (concurring/dissenting)

Madonna Linvog." Clerk's Papers (CP) at 924. It says this advance payment is to be an

offset against "any judgment, verdict, arbitration award, or settlement obtained by

Plaintiff Jared Barton against Defendants Korrine Linvog and/or Defendants Thomas and

Madonna Linvog." !d. at 924-25. In return for the advance payment, Barton agreed not

to execute on any judgment he obtained against the Linvogs in excess of the liability

insurance available to the Linvogs through their insurer. He would, however, be able to

execute on any judgment against the Linvogs up to the amount of the insurance limits

available. Finally, the agreement states that the advance payment does not represent a

settlement of Barton's claims "against Defendants." Id. at 925.

The State maintains that the plaintiff and the Linvogs "achieved the imposition of

improper joint liability against the State because the covenant not to execute was kept

hidden. By doing so, they circumvented the abolition of joint liability that is at the core

of' the tort reform act. Suppl. Br. ofthe State of Washington, Dep't ofTransp. at 17.

The State argues that the Court of Appeals improperly permitted the parties to determine

the operative legal effect of a release and thereby override statutory mandates. The State

says that the outcome of a statutory analysis cannot vary based on the litigants' "financial

whims." !d. at 12.

But Barton did not agree not to execute on a judgment against Korrine. Moreover,

the agreement accurately states that it is not a settlement against "Defendants," who are

identified in the document as both the Linvogs and Korrine. Because it had no effect on

4 No. 86924-3 Madsen, C.J. (concurring/dissenting)

Korrine or her liability, the agreement plainly did not act as a settlement with regard to

her.

The "fault" on which liability is based for both the Linvogs and Korrine is that of

Korrine; the Linvogs' liability is vicarious. With or without the agreement, Korrine's

fault was before the jury; the agreement did not remove Korrine' s share of fault from the

scope ofRCW 4.22.070's apportionment scheme. The jury's apportionment of fault

between Korrine and the State meant that these two defendants were jointly and severally

liable. Therefore, the agreement did not eliminate joint and several liability.

In addition, the parties to the agreement intended that it would affect only Barton's

ability to execute on the judgment against the Linvogs. The trial court's unchallenged

finding of fact is that the parties to the agreement believed and intended that the Linvogs

were in fact still liable after they entered the agreement because the agreement had no

effect on contribution rights. CP at 9. Nothing in the agreement itself purports to excuse

the Linvogs from any liability for contribution. This is in marked contrast to the

agreement at issue in Maguire v. Teuber, 120 Wn. App. 393, 397-98, 85 P.3d 939 (2004),

where a covenant not to execute expressly stated that it was intended to '"completely"'

resolve "'all claims by the plaintiffs against the defendants"' who were parties to the

agreement and "'any and all contribution claims against those defendants will be

extinguished by this settlement."' (Quoting agreement.)

5 No. 86924-3 Madsen, C.J. (concurring/dissenting)

The agreement was not a "covenant not to enforce judgment" within the meaning of RCW 4. 22. 060

Because Korrine's fault was still before the jury, and because any contribution

rights against the Linvogs based on vicarious liability were not affected by the agreement,

it was not an agreement that extinguished contribution rights and was not an "agreement"

under RCW 4.22.060(2) "similar to" a "release" or a "covenant not to sue" that would

"discharge[]" the Linvogs "from all liability for contribution."

I recognize that the part of the agreement where Barton agreed not to execute on

any judgment against the Linvogs on any amount in excess of the insurance limits raises

the obvious question whether it is a covenant not to enforce judgment for purposes of

RCW 4.22.060. But as the majority states, contract law has a place here, and we should

look to the entire document to see whether it is the kind of agreement "similar" to a

"release" as RCW 4.22.060 states.

What the parties call an agreement is not controlling. Even if Barton and the

Linvogs had called their agreement a "covenant not to enforce judgment," this would not

control as to whether it fell within the scope ofRCW 4.22.060 as equivalent to a

"release." In a similar vein, the parties' statement that the agreement was not a

settlement, in and of itself, does not determine how it should be treated, either. Rather,

the operative effect of the agreement controls and this must be determined with regard to

all that the document provides.

I would hold that the agreement does not come within RCW 4.22.060, thus ending

the case. 6 No. 86924-3 Madsen, C. J. (concurring/dissenting)

The majority errs in deciding that an agreement thatfalls within RCW 4.22. 060 does not release the party for purposes of RCW 4.22. 070 's determination ofjoint and several liability

It follows that this case does not require us to decide whether a covenant not to

enforce judgment under RCW 4.22.060 is necessarily a release under RCW 4.22.070.

But while it is unnecessary to construe the term "release" as used in RCW 4.22.070, since

the majority has done so, I turn to that issue next.

The majority improperly declines to construe the term "release" in the statutory

context in which it appears and instead relies on dictionary and other definitions to

conclude that an agreement that comes within RCW 4.22.060 does not necessarily release

the party for purposes ofRCW 4.22.070. But the majority's resort to these definitions

does not follow our well-developed approach to discerning the meaning of language in

statutes.

The goal when construing a statute is to ascertain and give effect to the

legislature's intended meaning. We determine legislative intent from the meaning of the

words at issue, the context of the statute in which the provision at issue is found, related

provisions and statutes that bear on the meaning of the language at issue, and the

statutory scheme as a whole. Manary v. Anderson, 176 Wn.2d 342, 352, 292 P.3d 96

(2012); Lowry v. PeaceHealth, 174 Wn.2d 769, 779, 280 P.3d 1078 (2012); Dep 't of

Ecology v. Campbell & Gwinn, LLC, 146 Wn.2d 1, 11, 43 P.3d 4 (2002). Rather than

deliberating ignoring the related statutory provisions as the majority does, we should

examine them as the best indicator of legislative intent.

7 No. 86924-3 Madsen, C.J. (concurring/dissenting)

Both RCW 4.22.060 and .070 use the word "release." In RCW 4.22.060, the

legislature listed several types of settlement agreements, expressly equating them within

the statute to a "release" ("[a] release, covenant not to sue, covenant not to enforce

judgment, or similar agreement" (emphasis added)). This statutory provision itself shows

that an agreement that comes within the statute is to be regarded as a release. See

Cornelius J. Peck, Reading Tea Leaves: The Future of Negotiations for Tort Claimants

Free from Fault, 15 U. PUGET SOUND L. REV. 335, 344 (1992) ("RCW 4.22.060 refers to

'a release, covenant not to sue, covenant not to enforce judgment, or similar agreement'

as being interchangeable for the purpose of determining the effect of a settlement

agreement").

In addition to equating the listed agreements with a release, RCW 4.22.060

provides that these agreements operate to extinguish contribution obligations, as noted.

When considered in connection with RCW 4.22.070, this part ofRCW 4.22.060 supports

the conclusion that an agreement falling within RCW 4.22.060 operates as a release for

purposes ofRCW 4.22.070.

RCW 4.22.070(1) states in part that "entities whose fault shall be determined

include ... entities released by the claimant" and "UJudgment shall be entered against

defendant except those who have been released by the claimant." RCW 4.22.070(2) says

that a jointly and severally liable defendant's rights to contribution against another jointly

and severally defendant and the effect of a settlement by either is determined under RCW

4.22.040, .050, and .060. Thus, the right to contribution mentioned in RCW 4.22.070 that

8 No. 86924-3 Madsen, C.J. (concurring/dissenting)

is determined under RCW 4.22.040, .050, and .060 is a right that arises among jointly and

severally liable defendants, but it cannot not arise under the agreements listed in RCW

4.22.060.

This interrelationship of the statutes, too, shows that the agreements listed in RCW

4.22.060 do operate to release an entity for purposes of joint and several liability under

RCW 4.22.070. And in fact, this is the construction favored by a leading authority on the

1986 tort reform laws. Peck, supra, at 335, 343-44.

Unlike the majority, I would hold that an agreement that comes within RCW

4.22.060, and which is equivalent to a "release" as expressly provided by the statute, acts

to release the party for purposes of the apportionment of liability under RCW 4.22.070.

Next, I disagree with the majority's overruling of the analysis in Maguire

regarding the issue whether the agreements in those cases released the defendants who

were party to them. The agreement at issue in Maguire was a covenant not to enforce

judgment within the scope ofRCW 4.22.060. The Court of Appeals appropriately

concluded that it operated to release the defendants who were a party to it and therefore

these defendants should have been dismissed from the case. The covenant stated that the

parties were settling '"for the purpose of avoidance of the uncertainties, inconvenience,

and expenses of the pending lawsuit'" and that the covenant "'is intended to constitute a

complete resolution of all claims by the plaintiffs against defendants Teuber and Hadsall

under RCW 4.22.060 such that any and all contribution claims against those defendants

9 No. 86924-3 Madsen, C .J. (concurring/dissenting)

will be extinguished by this settlement."' Maguire, 120 Wn. App. at 397-98 (quoting

covenant).

Because it was an agreement coming within RCW 4.22.060, it released the two

defendants for purposes ofRCW 4.22.070, as explained above. The court's analysis in

the case is well-reasoned and consonant with the relevant statutes.

As with Maguire, I disagree with the majority's partial overruling of Romero v.

West Valley School District, 123 Wn. App. 385, 98 P.3d 96 (2004). Romero involves a

classic "Mary Carter" agreement. It provided that the defendant who was party to the

agreement would pay the limits of insurance and the plaintiffs agreed that if they

recovered more than the insurance limits from the remaining defendant, the defendant-

party to the agreement would be reimbursed by the plaintiffs $1 for every $2 the plaintiffs

recovered in excess of the insurance. The parties agreed the settling defendant would

remain in the suit as a defendant. In such circumstances, there is a strong incentive on

the part of the settling defendant and the plaintiff to skew the trial against the remaining

defendant. The Court of Appeals, relying on Maguire, concluded in Romero that the

agreement released the settling defendant and held that the remaining defendant was

severally liable only for the portion of the damages due to its own fault.

When an agreement manipulates joint and several liability as the agreement did in

Romero, and aligns the plaintiffs and all but one of the potentially liable defendants

against the remaining defendant, a court should conclude that joint and several liability

has been destroyed. For this reason, at the least, such an agreement should be held to

10 No. 86924-3 Madsen, C. J. (concurring/dissenting)

release the settling defendants. Otherwise, their presence at trial and in the jury's

calculations can result in unfair joint and several liability on the part of the nonsettling

defendant.

Sanctions

The State maintains that a more severe sanction should be imposed for failure to

notify it of the "secret'' agreement between Barton and the Linvogs. The majority

concludes that the failure to disclose the parties' agreement violated CR 26(e)(2) as a

failure to seasonably amend or supplement discovery requests and violates RCW

4.22.060(1 ), which requires that "prior to entering into a release, covenant not to sue,

covenant not to enforce judgment, or similar agreement with a claimant" a party must

"give five days' written notice of such intent to all other parties and the court." The

majority therefore holds that the trial court did not err in exercising its discretion to

impose the sanctions. The majority denies, however, the State's request for more severe

sanctions.

Although the majority states that Barton and the Linvogs concede they failed to

comply with the notice requirement ofRCW 4.22.060, majority at 26, this does not

appear to be the case. Rather, Barton concedes some sanction was appropriate under the

civil rule, but not a greater sanction as urged by the State. The Linvogs do not concede

the propriety of sanctions under the statute, either.

Because the court should hold that the agreement is not a "covenant not to enforce

judgment" as contemplated under RCW 4.22.060(2), it should similarly hold the

11 No. 86924-3 Madsen, C .J. (concurring/dissenting)

agreement does not come within RCW 4.22.060(1). The statutory notice provision does

not apply and sanctions are not appropriate on this basis. I would conclude that the trial

court abused its discretion in awarding sanctions under the statute and agree that the

State's request for additional (more severe) sanctions under the statute should be denied. 3

I would hold that the agreement between Barton and the Linvogs is not a covenant

not to enforce judgment as this term is used in RCW 4.22.060. Korrine and the State

both remained as defendants at trial, neither was a party to the agreement, and together

they were responsible for 100 percent of fault, once Barton was determined to be a fault-

free plaintiff. They were jointly and severally liable. No settlement occurred that

reduced liability for total damages because Korrine remained exposed to direct liability

and the Linvogs remained, under the parties' agreement, exposed to liability for

contribution. In these circumstances there was no prejudice to the State and no additional

sanctions are appropriate.

3 My disagreement extends to the award of sanctions only insofar as it is based on RCW 4.22.060. I do not disagree that the award may be appropriate under CR 26. 12 No. 86924-3 Madsen, C.J. (concurring/dissenting)