Jackson v. Barton Malow Co.

346 N.W.2d 591, 131 Mich. App. 719

• Court: Michigan Court of Appeals
• Decided: February 6, 1984
• Docket: Docket 66012
• Status: Published

Opinions

T. M. Burns, P.J.

On July 16, 1982, the trial court entered a judgment for plaintiff of $0 against defendant. Plaintiff appeals as of right.

This case deals with one of the difficult unanswered questions left by Placek v Sterling Heights, 405 Mich 638; 275 NW2d 511 (1979), which adopted comparative negligence for this state. How does the trial court apportion damages after the verdict when one of the tortfeasors settled before trial? In the present case, plaintiff was injured on a construction site when he was struck in the face by a shovel. Eventually, he sued both defendant and the Barthel Contracting Company. Barthel settled for $150,000. The jury determined that plaintiff’s total damages were $400,000, but that plaintiff was 75% negligent. In arriving at the money judgment against defendant, the trial court first reduced the $400,000 damage figure by 75% ($300,000). It then subtracted the $150,000 settlement. Because this figure is less than zero, it entered a figure of zero dollars against this particular defendant.

Plaintiff argues that the trial court should have instead first subtracted the $150,000 settlement figure from the $400,000 damages figure and then subtracted the 75% comparative negligence. This would leave plaintiff with a $62,500 recovery against this defendant. Added to the $150,000 settlement figure he received from Barthel, this would leave plaintiff with a total recovery of $212,-500.

We find that the formula advanced by plaintiff should have been applied by the trial court. The Supreme Court recently expressed a policy against litigation over the relative degree of fault of third parties not represented in a suit. Mayhew v Berrien County Road Comm, 414 Mich 399; 326 NW2d 366 (1982). This Court has stated that the formula used by the trial court "would have required jurors to consider plaintiff’s degree of fault relative to all parties involved in the incident, including non-party settling tortfeasors, contrary to the policies announced in Mayhew". Gagnon v Dresser Industries Corp, 130 Mich App 452; 344 NW2d 582 (1983). The Court in Gagnon found that it was proper to deduct the amount of the settlement before making the deduction for comparative negligence.

Even before Gagnon, this Court found that the settlement figure should be subtracted before subtracting the percentage due to comparative negligence. Rittenhouse v Erhart, 126 Mich App 674, 683; 337 NW2d 626 (1983). In Rittenhouse, this Court noted that this state has a very strong policy favoring settlements. E.g., Empire Industries, Inc v Northern Assurance Co, Ltd, 342 Mich 425; 70 NW2d 769 (1955); Pratt v Castle, 91 Mich 484; 52 NW 52 (1892); Krevsky v Naccarato, 56 Mich App 704; 224 NW2d 731 (1974), lv den 394 Mich 772 (1975). In fact, "courts will encourage settlements which avoid litigation * * *”.5 Michigan Law & Practice, Compromise and Settlement, § 1, p 367. Especially during this time when our courts are flooded with litigation, we should encourage settlements. We are convinced that this rule will encourage settlements. The nonsettling tortfeasor will more likely realize that he is running a risk of increasing the amount he will later pay if he does not settle. Under this rule, the nonsettling tortfeasor will not escape liability for his negligence by merely relying on the settling tortfeasor’s contribution as would otherwise happen in a case such as the present one.

Our position is further supported by DeMaris v Brown, 27 Wash App 932, 945-946; 621 P2d 201, 208-209 (1980):

"The issue we decide is this: Where the plaintiffs settle with one concurrent tort-feasor for $10,000, their damages are determined to be $50,000, and the jury finds the decedent 85 percent negligent, should the $10,000 settlement be deducted from the plaintiff’s total damages of $50,000 or should the $10,000 be offset against the $7,500 that the nonsettling defendant is otherwise legally obligated to pay, i.e., the plaintiff’s total damages less the percentage of negligence attributable to the decedent? We hold that the $10,000 settlement must first be deducted from the plaintiffs’ total damages. The jury, without knowing of the settlement, found the total damages to equal $50,000. By reducing the $40,000 by the decedent’s 85 percent contributory negligence, the comparative negligence rule is not affronted since the total percentage of contributory negligence remains the same. No one can know whether the tort-feasor’s combined negligence might have been found to be 20 percent or less, in which case the State might not have owed anything, or more than 20 percent, in which case the State might have been liable for any excess over $10,000. The settling tort-feasor most likely wished to wash his hands clean of the whole affair. Involving the settling tort-feasor in this suit has been avoided. The trial court should have awarded the plaintiffs a judgment of $6,000.”¹

Therefore, plaintiff is entitled to $62,500 from the defendant.

Judgment affirmed as modified.

1 Although both Aceves v Regal Pale Brewing Co, 24 Cal 3d 502; 156 Cal Rptr 41; 595 P2d 619 (1979), and Lemos v Eichel, 83 Cal App 3d 110; 147 Cal Rptr 603 (1978), endorsed the method used by the trial court, both cases are distinguishable. In each, the jury computed the separate percentages of negligence for each tortfeasor.