Georgia’s Apportionment Scheme: Reevaluating Accepted Litigation Tactics

February 15, 2012

Georgia’s “fair share” approach to apportioning tort liability has been the subject of much policy debate since its adoption with tort reform in 2005. But the discussion has mostly ignored the repercussions for conventional defense litigation tactics in multi-party complex litigation. Now, however, litigators are dealing with those side effects daily as the first cases decided under the new apportionment scheme wind their way through the appellate courts, bringing unanticipated pitfalls.

It is no secret that many defendants tilt toward a united defensive front as a favored trial strategy in tort cases involving allegations of joint fault, such as product liability. Such strict solidarity may no longer be a viable option under apportionment, especially in cases involving expert proof and the strict expert disclosure deadlines in federal court. The timing of new evidentiary burdens accompanying the change in remedy from contribution to apportionment has shifted the calculation. Defense counsel should now at least think twice and weigh the relative merits of maintaining a unified front through discovery. That is not to say that joint defense agreements are likely to fade quickly into the past or that co-defendants need automatically adopt an adversarial posture among themselves. To the contrary, cooperation among defendants will and should remain a preferred strategy. Where defense counsel must adapt is in addressing the potential need to prove the fault of a co-defendant, through expert testimony or otherwise, in the event of an unexpected settlement, lest a client be left alone of the hook.

Pre-Tort Reform: Joint and Several Liability Plus Contribution

Under the pre-tort reform version of Georgia’s apportionment rule, joint and several liability with a right of contribution was the default rule. Apportionment was only applicable where the plaintiff was contributorily negligent. In the majority of cases, each joint tortfeasor bore the full brunt of an adverse result. When a plaintiff settled with or elected not to join a potentially liable party, the typical joint tortfeasor was faced with the unpalatable obligation of satisfying the entire judgment, and then limited options for reimbursement through a claim for contribution. Gay v. Piggly Wiggly Southern, Inc., 183 Ga. App. 175, 176-177, 358 S.E.2d 468 (1987); City of Albany v. Pippin, 269 Ga. App. 22, 23, 602 S.E.2d 911 (2004). Proportional fault was not a consideration as juries did not have the option to render an individualized verdict accounting for the involvement of settling defendants or other jointly liable, unnamed parties. In the past, given the option to subsequently divvy up liability through a separate action for contribution, it made sense in many cases to look the other way regarding the potential fault of co-defendants in the interest of focusing on weaknesses in the plaintiff’s case.

Tort Reform: Apportionment and the Abolishment of the Right to Contribution

Under amended O.C.G.A. § 51-12-33, the world of non-party apportionment is a very different place. Instead of a joint judgment, defendants are presumptively only liable for their fair share of liability. Both joint and several liability and the right to contribution are expressly eliminated through O.C.G.A. § 51-12-33(b). The jury is required to proportionally allocate liability among all persons responsible according to their respective fault, with such damages being only the “liability of each person against whom they are awarded.” O.C.G.A. § 51-12-33(b). To the extent that the plaintiff is found at fault, that percentage is offset against the total recovery. O.C.G.A. § 51-12-33(a). But defendants must be cognizant that the trap in apportionment lies in their burden to prove non-party fault in complex litigation.

In combination, the elimination of a separate action and the ability for the jury to consider and allocate non-party fault–with the corresponding evidentiary burden–are the genesis of the need to adjust. Both Georgia and federal courts have recently illustrated that the burden to come forward with evidence to apportion damages against a co-defendant that settles before trial lies squarely on the shoulders of the other defendants, under peril of losing that right.

Recent Decisions Illustrating the Risks

In McReynolds v. Krebs, the Georgia Court of Appeals affirmed the dismissal of a cross-claim against Ford in a car accident and related product liability action, on the basis of Ford’s pre-trial settlement with the plaintiff. The Krebs court held that the trial court did not err in dismissing Ford over the co-defendant’s objection because there was no reason for Ford to remain in the case under apportionment where the driver co-defendant had come forward with no evidence that Ford was at fault in the accident. McReynolds v. Krebs, 307 Ga. App. 330, 705 S.E.2d 214 (2010). While the co-defendant likely intended to piggyback on the plaintiff’s expert and other evidence against Ford at trial, and cannot necessarily be faulted for neglecting to independently pursue the costly discovery necessary to pursue and prove a product liability cross-claim, the decision underscores the burden that accompanies the benefits of apportionment.

Similarly, in Obeso v. Jacobson, Judge Richard Story of the Northern District of Georgia authored an opinion that outlines the tension between co-defendants who strategically adopt a unified front and then must meet their burden of proof to apportion damages to one of their number that elects to settle after the close of discovery. Obeso v. Jacobson, No. 2:08–CV–248–RWS,2010 WL 4882971 (N.D. Ga. Nov. 24, 2010). Throughout the litigation in that case, two of the defendants consistently took the position in their initial disclosures and discovery responses that no negligence had taken place. Id. at *1, 4. Following a settlement between the plaintiff and the defendant hospital, the remaining defendants quickly backpedaled in order to pursue apportionment. While the Northern District allowed the evidence of the claim, in part, it strongly suggested that the failure to disclose the defense earlier would have resulted in apportionment being barred absent mitigating circumstances relating to an elusive witness. Id. at *6.

Early Consideration of Co-Defendant and Non-Party Liability Mitigates the Risk

In the aftermath of contribution, the upshot for defendants in multi-defendant tort cases is that the only recourse against a settling co-defendant is through independently disclosing, alleging, and proving joint fault in that co-defendant’s absence. Id. The obvious risk for failing to do so is that the plaintiff will elect not to present expert testimony or other evidence against a co-defendant at trial due to a settlement, leaving an unprepared defendant without evidentiary grounds to add a non-party to the verdict form. With no right to contribution, the practical effect is that the defendant may have no real remedy at all. To the same end, defendants that do not disclose alleged fault lying with other parties or non-parties early on in the case risk having their answers in discovery held against them and apportionment barred, whatever the motivation for failing to pursue the claim initially. Id.

While a unified front may have been an effective tactic under Georgia’s prior law of contribution, the shifting statutory scheme demands that counsel evolve with it in order to preserve the significant new protections offered by non-party apportionment. Without looking too hard, defendants can now find several reasons to justify development and presentation of evidence of joint fault among their co-defendants, to the detriment of traditional notions that prevailed under the prior law of contribution. Early consideration of the benefits and detriments to asserting and proving co-defendant and non-party fault should be an integral part of every multi-defendant complex tort case in Georgia.

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