Swett v. Haig's, Inc.

663 A.2d 930, 164 Vt. 1, 1995 Vt. LEXIS 67

• Court: Supreme Court of Vermont
• Decided: June 2, 1995
• Docket: 94-049
• Status: Published

Opinions

Dooley, J.

The principal issue in this case is whether the Dram Shop Act permits contribution from an intoxicated driver for damages a dram shop may be required to pay a motorist injured in an accident with the intoxicated driver. The trial court held that contribution was not available. We conclude that the Act authorizes contribution, and therefore, we reverse.

Haig’s, Inc., a dram shop, was sued by plaintiff Tanya Swett, a motorist who was seriously injured in an accident caused by Eric Jensen while he was operating his vehicle in Jamaica, Vermont. Plaintiff alleged that Jensen was intoxicated and that Haig’s, Inc. served him liquor despite his intoxicated state. She further alleged that as a direct consequence of Haig’s acts, the accident and her injuries occurred. Haig’s filed a third-party complaint against Jensen, seeking contribution to any damages paid plaintiff pursuant to § 501(f) of the Dram Shop Act, 7 V.S.A. §§ 501-507, which permits contribution from “any other responsible person.” Jensen sought to dismiss the complaint, arguing that he was not a responsible party under the Act and, therefore, could not be held liable indirectly under its contribution provision.

In holding that contribution was unavailable, the trial court determined that an intoxicated driver is not a responsible person under the Dram Shop Act, and reasoned that “the plain meaning of 7 V.S.A. § 501(f) allows defendant dram shops to have a right of contribution from other sellers of alcoholic beverages, but not against those to which the statute’s creation of liability does not apply, such as the driver.” The third-party complaint was dismissed, and Haig’s appealed.

Some background is necessary to put the question before us in context. Much of the law in this area has been shaped by the all-too-common circumstance of a driver, who is served alcoholic beverages by a dram shop after becoming visibly intoxicated, and who then becomes involved in an automobile accident, usually injuring another motorist. At common law, the dram shop was not liable to the injured motorist on the theory that the intoxicated driver’s action was the sole proximate cause of the accident. See Winney v. Ransom & Hastings, Inc., 149 Vt. 213, 215, 542 A.2d 269, 270 (1988). The dram shop was not liable even where the plaintiff showed that it was negligent by continuing to serve the driver and that the accident was caused by the driver’s impairment. Id. Before the reevaluation of this limited view of causation, the Vermont Legislature enacted the Dram Shop Act, which imposes strict liability for injuries to third parties on dram shops that serve persons “apparently under the influence of intoxicating liquor.” 7 V.S.A. § 501(a)(2);¹ see Clymer v. Webster, 156 Vt. 614, 619-20, 596 A.2d 905, 908-09 (1991). The Dram Shop Act preempts common-law negligence actions that come within its scope. See Estate of Kelley v. Moguls, Inc., 160 Vt. 531, 532, 632 A.2d 360, 361 (1993); Ransom & Hastings, Inc., 149 Vt. at 216, 542 A.2d at 270.

Because the Act’s preemptive effect is limited, an accident as described above can give rise to common-law negligence liability as well as liability against the dram shop under the Act. See Plante v. Johnson, 152 Vt. 270, 274, 565 A.2d 1346, 1348 (1989). Thus, the injured motorist may bring a common-law negligence action against the intoxicated driver. Id. The Legislature recognized the intoxicated driver’s liability and provided that the claim against the dram shop could be joined with the claim against the intoxicated driver. See 7 V.S.A. § 501(b). We have also held that the intoxicated driver can sue the dram shop for the driver’s damages on a common-law negligence theory. See Estate of Kelley, 160 Vt. at 536, 632 A.2d at 363.

The cross-claim between the dram shop and the intoxicated driver arises from a subsection of the Dram Shop Act, which was added in 1987, and provides:

(f) Right of contribution. A defendant in an action brought under this section has a right of contribution from any other responsible person or persons, which may be enforced in a separate action brought for that purpose.

7 V.S.A. § 501(f). Apart from any statute to the contrary, we have consistently held that there is no right of contribution between joint tortfeasors. See Peters v. Mindell, 159 Vt. 424, 427, 620 A.2d 1268, 1270 (1992); Howard v. Spafford, 132 Vt. 434, 435, 321 A.2d 74, 75 (1974) (adoption of comparative negligence did not abrogate no contribution rule). The parties here are joint tortfeasors; there is no question that contribution is unavailable under the common-law rule. The narrow question before us is whether § 501(f) has created a right of contribution.

The parties agree that the question must be resolved under principles of statutory construction. In construing a statute, our primary objective is to effectuate the intent of the Legislature. See Bisson v. Ward, 160 Vt. 343, 348, 628 A.2d 1256, 1260 (1993). Initially, we presume the Legislature intended the plain, ordinary meaning of the statute. Id. Where the meaning is clear and unambiguous, we construe and enforce the statute according to its express meaning. See Langle v. Kurkul, 146 Vt. 513, 515, 510 A.2d 1301, 1302-03 (1986). Words of doubtful meaning do not change common law rules; the intent to do so must be expressed in clear and unambiguous language. See Estate of Kelley, 160 Vt. at 533, 632 A.2d at 362.

We conclude that the wording of § 501(f) is clear and unambiguous, in the context of the whole statute, and it authorizes contribution in this case. The intoxicated driver is a person “responsible” for the injuries to the other motorist although the common law creates that responsibility rather than the Dram Shop Act. There is nothing in § 501(f), or the Act as a whole, to suggest that the Legislature used the word “responsible” in other than its ordinary and plain meaning. Indeed, the Legislature used the phrase “defendant in an action brought under this section” in subsection (f), showing that it knew how to limit its action to Dram Shop Act defendants when that was clear. It did not express such an intent in defining the responsible person from whom contribution could be sought; we conclude this omission was intentional. Finally, we think it is instructive that in two places the Act acknowledges the existence of common-law responsibility in circumstances not directly covered by the Act. See 7 V.S.A. §§ 501(b) (injured party may bring joint action against dram shop and person intoxicated), 501(g) (social host liability still governed by common law). Thus, the Legislature was clearly aware that responsibility could arise from the common law as well as from the Act.

Although in dicta, we have examined the statute once before and reached the same conclusion. In Clymer v. Webster, we cited the statute as permitting contribution between a dram shop and an intoxicated driver despite the lack of a common theory of liability between those defendants. 156 Vt. at 621 n.3, 596 A.2d at 909 n.3. On reexamination, we reaffirm its conclusion.

We have reached the above conclusion without relying on the legislative history cited by Haig’s and Friends of Fairness in Vermont Dram Shop Law, which submitted an amicus curiae brief in support of reversal. As is often the case in this state, we find the legislative history sparse and ambiguous.² See State v. Madison, 163 Vt. 360, 372-74, 658 A.2d 536, 544-45 (1995) (per curiam) (legislative history consisting of witness comments and post-hoc committee reaction insufficient to overcome judicial consensus regarding meaning of term “review de novo” in constitutional amendment); In re Killington, Ltd., 159 Vt. 206, 216, 616 A.2d 241, 247 (1992) (legislative history inconclusive and therefore insufficient to justify departure from stare decisis). We do find support in the fact that each of the bills that led to the 1987 amendment to the Dram Shop Act had as one of its two main purposes to “limit liability under the ‘dram shop’ law.” Statement of Purpose, S. 5, Vt. Bien. Sess. (1987); Statement of Purpose, S. 14, Vt. Bien. Sess. (1987); Statement of Purpose, H. 57, Vt. Bien. Sess. (1987). Our decision limits the eventual liability of a dram shop by allowing it to obtain contribution from the intoxicated driver. The opposite interpretation would not.

We are also not persuaded by Jensen’s public policy arguments.³ Essentially, Jensen restates the arguments against contribution generally, as set forth in Howard v. Stafford, and expresses concern that the injured motorist, Tanya Swett, may not recover all her damages, depending on how we apply the comparative negligence statute to Dram Shop Act cases. The main thrust of the Howard opinion is that any change to the no-contribution rule should come from the Legislature and not from this Court. See Howard, 132 Vt. at 438, 321 A.2d at 77. Section 501(f) undeniably provides for contribution in some circumstances; Jensen’s arguments against contribution have been rejected for the circumstances covered by the statute.

We recognize there are complexities introduced by contribution between tortfeasors whose liability is based on different theories. As we noted in Clymer, other states have worked out contribution rules despite these complexities. See Clymer, 156 Vt. at 621 n.3, 596 A.2d at 909 n.3; see also 1 J. Mosher, Liquor Liability Law § 18.03[6][a] (1995) (discussing cases which have allowed dram shop to obtain contribution against intoxicated person where there is “a finding of common liability for the plaintiff’s injuries”). Moreover, much of the complexity is present even if we were to deny the availability of contribution. See Plante v. Johnson, 152 Vt. at 272-73, 565 A.2d at 1347-48. We believe that courts will treat the injured motorist fairly while allowing contribution as authorized by § 501(f).

Alternatively, Jensen urges us to affirm on either of two additional grounds raised below but not addressed by the trial court. We reject one of these grounds and decline to rule on the other because of the posture of the case.

First, Jensen argues that the third-party complaint was premature, and the right of contribution, even if available, must be enforced in a separate action. Haig’s filed its third-party complaint pursuant to V.R.C.E 14(a), which provides in pertinent part:

At any time after commencement of the action a defendant as a third-party plaintiff may cause to be served a summons and complaint upon a person not a party to the action who is or may be liable to such third-party plaintiff for all or part of the plaintiff’s claim against the third-party plaintiff.

The rule allows a defendant to bring in a third party “who is or may be liable to him for some or all of the plaintiff’s claim on a theory such as indemnity, subrogation, contribution, or warranty.” Reporter’s Notes, V.R.C.E 14 (emphasis supplied).

We have recently addressed the timing of third-party actions to enforce indemnity claims. See Riblet Tramway Co. v. Marathon Electronics-Avtek Drive Div., 159 Vt. 503, 506-07, 621 A.2d 1274, 1275 (1993). We reasoned that third-party complaints may be filed even though a separate action would be premature because third-party plaintiff’s liability to plaintiff is not established. Id. at 506, 621 A.2d at 1275. Thus, we held that “the third-party plaintiff’s claim against the third-party defendant arises or accrues when the plaintiff files the complaint in the original action.” Id. We see no reason for a different rule for a contribution claim.

Jensen argues, however, that even if Rule 14(a) authorizes a third-party complaint for contribution, § 501(f) authorizes a contribution claim only in a separate action. Jensen misreads § 501(f). Although the section states that the dram shop’s right to contribution “may be enforced in a separate action brought for that purpose,” nothing in the language suggests that a separate action is the exclusive method of enforcing the right. Indeed, Jensen’s position would change the authorizing word “may” to “must.” We conclude, instead, that the Legislature acted to ensure that contribution could be sought in a separate action, and not that it intended to prohibit use of third-party practice. The third-party complaint was not premature.

Alternatively, Jensen argues that we should affirm the dismissal of the third-party complaint because Jensen has settled with plaintiff, and obtained a release from her.⁴ Plaintiff has not participated in this appeal because it involves solely the judgment between third-party plaintiff and third-party defendant. Because our determination of the effect of the settlement and release could affect the amount of plaintiff’s recovery, we think it is unfair to resolve the effect of the settlement without her participation.⁵ We remand to the trial court for that opportunity.

Reversed and remanded.

1 Strict liability also arises in three other circumstances: (1) the person served is a minor, (2) the person is served “after legal serving hours,” or (3) where “it would be reasonable to expect [that the person served] would be under the influence of intoxicating liquor as a result of the amount of liquor served.” 7 VS.A. § 501(a)(1), (3) &(4).

2 The dissent argues that the Legislature’s refusal to make the intoxicated driver liable under the Act shows that it intended that no contribution from the intoxicated driver be available to the dram shop. We have no evidence that the Legislature directly linked these issues as the dissent suggests. Making contribution available to the dram shop would be a minor consequence of bringing the intoxicated driver under the Act compared to the major consequence of changing the standard of liability for the intoxicated driver from negligence to strict liability. We do not agree that the failure to bring the intoxicated driver under the Act is any evidence of the Legislature’s intent to narrow the meaning of “responsible person” to only those liable under the Dram Shop Act.

Nor are we persuaded by the Legislature’s failure to deal with the contribution right of the intoxicated driver. It is logical that the Legislature would have left it to the common law to define the contribution right, if any, because the common law governs the intoxicated driver’s rights and liability We are, of course, free to extend contribution rights to the intoxicated driver in light of the Legislature’s action in providing such rights to dram shops. Cf. Cold Springs Farm Dev., Inc. v. Ball, 163 Vt. 466, 472, 661 A.2d 89, 93 (1995) (where the Legislature provided that judgments on small-claims counterclaims would not have preclusive effect in later litigation, Court adopted similar rule for claims-in-chief in small claims to avoid “an unfair and unjustified inconsistency”).

3 The dissent argues that the adoption of contribution from the intoxicated driver is tantamount to repealing the Dram Shop Act because the dram shop no longer has an incentive to comply with the law. We disagree that allowing contribution from the intoxicated driver will reduce incentive to comply with the law in any measurable way. See Leflar, Contribution and Indemnity Between Tortfeasors, 81 U. Pa. L. Rev. 130, 134 (1932) (“It is difficult to believe that the no contribution rule has ever had much effect by way of making careless people careful . . . .”). Whatever is the outcome of litigation between the dram shop and the intoxicated driver, the dram shop is likely to owe a substantial judgment to the injured motorist. The dram shop retains a strong interest in avoiding liability by complying with restrictions on serving intoxicated persons whether or not it can shift part of the cost to the intoxicated driver. We do not agree that the dram shop proprietor’s behavioral calculation will somehow be affected by the possibility of defraying part of its losses by obtaining a contribution judgment, assuming it could collect on that judgment.

Even if we accepted the dissent’s reasoning on incentives, its omission of the incentives on the intoxicated driver is glaring. In this case, the driver apparently has minimal insurance and the dram shop is the “deep pocket.” To avoid collection difficulties, plaintiff settled quickly with the intoxicated driver and is pursuing the dram shop for most of her damages. The consequences for the intoxicated driver are minimal. The dissent’s theory reduces or eliminates the driver’s incentive to purchase adequate insurance or to avoid driving while intoxicated.

4 Haig’s attempted to amend its answer to raise the release as a defense to plaintiff’s claims. Haig’s argued that a release of one joint-tortfeasor releases all joint-tortfeasors. The trial court denied the motion finding that it was dilatory and that the defense was not warranted by the circumstances. This ruling is not before us because. this interlocutory appeal is limited to whether the third-party complaint should have been dismissed.

5 We also note that Jensen has filed a fourth-party complaint against plaintiff alleging. that if he owes contribution to Haig’s, he is entitled by the release to be indemnified by plaintiff. This gives plaintiff an additional stake in how we resolve the effect of the settlement and release.