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GEORGE CHARLES v. GIANT EAGLE MARKETS (02/20/87)

decided: February 20, 1987.

GEORGE CHARLES, APPELLANT,
v.
GIANT EAGLE MARKETS, APPELLEE, V. STANLEY MAGIC DOOR, INC., AND JED DOORS, APPELLEES



Appeal from the Order of the Superior Court entered July 20, 1984, at No. 500 Pittsburgh, 1982, affirming the Order of the Court of Common Pleas of Allegheny County, Civil Division, entered March 2, 1982, at No. G.D. 78-11984.

COUNSEL

Peter J. Mansmann, Mansmann, Beggy & Campbell, Pittsburgh, Richard C. Angino, Neil J. Rovner, PA Trial Lawyers Ass'n, Harrisburg, for appellant.

Robert S. Garrett, Pittsburgh, for Stanley Magic Door, Inc., & JED Doors.

John Newborg, Pittsburgh, for Giant Eagle.

Nix, C.j.,*fn* and Larsen, Flaherty, McDermott, Hutchinson, Zappala and Papadakos, JJ. Papadakos, J., files a concurring opinion joining the majority opinion, in which Larsen, J., joins. Zappala, J., files a dissenting opinion.

Author: Nix

[ 513 Pa. Page 476]

OPINION

The important issue of first impression raised in this appeal is whether, under the Comparative Negligence Act*fn1 and the Uniform Contribution Among Tortfeasors Act ("UCATA"),*fn2 a non-settling tortfeasor is relieved of responsibility for payment of his proportionate share of damages to the extent that the consideration paid by a settling tortfeasor for a release from the plaintiff exceeds the settling tortfeasor's proportionate share of damages as determined by the jury. For the reasons that follow we have concluded that sound policy as well as proper interpretation of the pertinent statutory authority compel a holding that the non-settling tortfeasor is required to pay his full pro-rata share.

I.

Appellant George Charles ("Charles") filed an action in trespass against appellee Giant Eagle Markets, Inc., ("Giant Eagle") for damages resulting from injuries sustained in a fall near the door of one of Giant Eagle's retail stores on January 17, 1977. Giant Eagle joined Stanley Magic Door, Inc., and Jed Door ("Stanley"), which the parties agree are a single entity, as additional defendants. Prior to trial, Charles executed a release to Giant Eagle in exchange for Twenty-two Thousand Five Hundred Dollars ($22,500.00). On March 27, 1981, after trial, the jury returned a verdict in favor of Charles in the amount of Thirty-one Thousand Dollars ($31,000.00). In accordance with instructions consistent with the provisions of the Comparative Negligence Act, the jury found Giant Eagle sixty percent (60%) negligent and Stanley forty percent (40%) negligent. Thus, had it not settled, Giant Eagle's proportionate share of the verdict would have been Eighteen Thousand Six Hundred Dollars ($18,600.00), Three Thousand Nine Hundred Dollars

[ 513 Pa. Page 477]

($3,900.00) less than the consideration paid for the release. Stanley's proportionate share of the verdict was Twelve Thousand Four Hundred Dollars ($12,400.00).

Stanley entered judgment on the verdict and paid Charles Eight Thousand Five Hundred Dollars ($8,500.00), taking the position that the verdict against it should be reduced by the amount by which Giant Eagle's payment to Charles exceeded sixty percent (60%) of the verdict. Charles accepted payment but reserved his claim to the remainder of Stanley's share of the verdict. Stanley subsequently filed a petition to have the judgment marked satisfied, arguing that the verdict had been paid in full. The trial court granted the petition and ordered the judgment marked satisfied. Charles thereupon appealed to the Superior Court, which affirmed. Charles v. Giant Eagle Markets, Inc., 330 Pa. Super. 76, 478 A.2d 1359 (1984). This Court granted Charles' petition for allowance of appeal and heard argument on September 19, 1985, and reargument on September 16, 1986, and the matter is now ripe for disposition.

II.

The respective obligations between parties to a lawsuit can be finally determined either by way of a bona fide settlement or through trial. Settlement is a valuable tool in our arsenal of dispute resolution and it should not be undermined. The obligation of a tortfeasor as determined by settlement with the plaintiff should not be affected by a subsequent verdict against any of the remaining defendants. The inducements for a defendant to settle are the certainty of the agreed-upon obligation and the avoidance of the vagaries of trial. The finality of the settlement agreement is crucial. Any subsequent trial against the remaining defendants should not disturb the resolution reached between the plaintiff and the settling tortfeasor. It would be an equal disservice to a supportive settlement policy to provide a windfall to a non-settling tortfeasor where the settlement proves to be more generous than the subsequent verdict. As noted by the late Mr. Justice Musmanno, in

[ 513 Pa. Page 478]

    dissent, in Daugherty v. Hershberger, 386 Pa. 367, 126 A.2d 730 (1956):

To me it is absurd that a tortfeasor, because of the generosity of another person with whom he is no way associated except in fault, should by law be excused from paying what a tribunal of law has determined he should pay as a result of his own adjudicated individual wrong. Id., 386 Pa. at 377, 126 A.2d at 735.

Appellees' concern over a windfall to the plaintiff, if appellee were to be required to pay its full pro-rata share, is far overshadowed by the injustice of the result they urge. In addition to the erosion such a position would have upon a policy encouraging settlements, it is also bottomed on a fundamentally flawed premise. It assumes that the jury verdict more accurately measures the tortfeasor's obligation than that which is agreed upon between the parties by way of settlement. Such an assumption is without foundation either in reason or experience. There is no basis for concluding the jury verdict must serve as a cap on the total recovery that a plaintiff may receive. The responsibility of the settling tortfeasor should be finally resolved by the terms of the settlement.

The fallacy that the jury's verdict represents a measurement of damages superior to that agreed upon by the settling parties has been further illustrated by the Supreme Court of our sister state, New Jersey:

There is no precise measure of the amount of wrong. Even if the trial is as to damages only, successive juries would rarely make the identical appraisal. Nor is there reason to suppose that the jury's evaluation of losses is more accurate than the evaluation made by the parties to the settlement. Surely where liability is contested, the verdict may not reflect the exact worth of the injuries. When the cost of litigation is taken into account, it becomes still more difficult to say that enforcement of the judgment debtor's pro rata liability would enrich the plaintiff.

[ 513 Pa. Page 479]

III.

The pertinent language of the comparative negligence statute, 42 Pa.C.S. § 7102, is unquestionably compatible with the result reached today. That language provides, ". . . each defendant shall be liable for that proportion of the total dollar amount awarded as damages in the ratio of the amount of his causal negligence to the amount of causal negligence attributed to all defendants . . . ." 42 Pa.C.S. § 7102(b). This provision also limits the right to seek contribution to the amount a defendant "is so compelled to pay [to the plaintiff] more than his percentage share . . . ." Id. Applying this language to the instant facts Stanley would be obligated to pay Twelve Thousand Four Hundred Dollars ($12,400) to the plaintiff and not the Eight Thousand Five Hundred Dollars ($8,500) as suggested by appellees. Moreover, Stanley would have no right of contribution against any remaining defendant since that right is only triggered where the party seeking contribution has been required to pay " more than " the pro-rata share.*fn3 Appellees' reliance upon the Superior Court's decision in Mong v. Hershberger, 200 Pa. Super. 68, 186 A.2d 427 (1962), to suggest that Giant Eagle has a right to seek contributions from the non-settling defendant is also in error. See N. 4 infra. The settling tortfeasor elected to pay the

[ 513 Pa. Page 481]

    consideration for the release to avoid further involvement in the lawsuit. Giant Eagle has no basis for receiving a windfall by way of contribution, if by hindsight it is determined that it overestimated the extent of its exposure.

When viewed realistically, it cannot be contended that such a result is unfair to any of the tortfeasors. As one commentator has cogently explained:

Defendants have been required under the proportional reduction rule to pay only their own share of liability, and they have not contributed anything to the settlement excess. Since they are protected by the proportional reduction rule from the burden of a low settlement, they cannot claim that they are entitled to the offsetting benefits of the rule. Indeed, to award defendants a windfall from such settlements could discourage some tortfeasors from settling in the hopes of gaining, as defendants, the benefits of the settlements of their cotortfeasors.

The settled tortfeasor's claim to the benefits of a high settlement is also weak. Certainly such a tortfeasor has contracted with the plaintiff to limit liability and "buy his peace." In return, the tortfeasor can fairly be said to have contracted away the right to any benefits resulting from a determination that the settlement was "high." When this meager or nonexistent interest is weighed against the potentially harmful impact on settlements from denying the benefits to the plaintiff, the conclusion is inescapable that the settled tortfeasor's claim should be denied.

Comment, Comparative Negligence, Multiple Parties, and Settlements, 65 Calif.L.Rev. 1264, 1279 (1977) (footnote omitted).

In our view the UCATA, properly interpreted, supports our view. Section 8326 of the UCATA provides:

A release by the injured person of one joint tort-feasor, whether before or after judgment, does not discharge the other tortfeasors unless the release so provides, but reduces the claim against the other tort-feasors in the

[ 513 Pa. Page 482]

    amount of the consideration paid for the release or in any amount or proportion by which the release provides that the total claim shall be reduced if greater than the consideration paid.

42 Pa.C.S. § 8326.

This section affords the parties to the release an option to determine the amount or proportion by which the total claim shall be reduced provided that the total claim is greater than the consideration paid. In this instance the release specifically provided:

We find no inconsistency with the UCATA, given the clear language of both that statute and the release executed by Charles and Giant Eagle, in reducing the jury's verdict by Giant Eagle's proportionate share of damages. We conclude, therefore, that Stanley is liable for the full amount of its proportionate share of the jury verdict.*fn4

Accordingly, the Order of the Superior Court is reversed and the satisfaction of the judgment entered by the court below is hereby vacated.

Disposition

Accordingly, the Order of the Superior Court is reversed and the satisfaction of the judgment entered by the court below is hereby vacated.

PAPADAKOS, Justice, concurring.

I join in the Majority Opinion. Because of the importance of the issues raised by this case, however, I am compelled to express my understanding of the interplay between our comparative negligence statute, the former contributory negligence law and the pertinent sections of the uniform

[ 513 Pa. Page 483]

    contribution among tortfeasors acts as now applicable, all of which are necessary in explaining the result reached by the court today.

This is the appeal of George Charles (Appellant) from the Opinion and Order of Superior Court affirming the order of the Court of Common Pleas of Allegheny County directing the Prothonotary of that County to mark satisfied a judgment entered against Appellees, Giant Eagle Markets, (Giant Eagle), Stanley Magic Door, Inc., and Jed Doors (Stanley).

On January 17, 1977, Appellant was in the process of entering the front door entrance of a Giant Eagle Supermarket on Center Avenue in the City of Pittsburgh. This door is an electronically operated door commonly found in supermarkets, and is activated by stepping on a floor mat adjacent to the door. Appellant stepped onto the mat, which was covered with snow, ice and slush, but the door failed to open.

As Appellant began to apply pressure to the resisting door, his foot slipped on the snow and ice and the door suddenly swung open, throwing him to the ground. The fall caused Appellant to suffer injuries to his right arm, hand, and left leg, and precipitated this trespass action originally brought against Giant Eagle.

In his complaint, Appellant claimed that his injuries were caused by Giant Eagle's failure to keep the door mat free and clear of snow and ice, and to keep the door in working order. Giant Eagle, in turn, joined Stanley Magic Door, Inc., and Jed Doors, the manufacturer of the door, as additional defendants, claiming that they were responsible to Appellant for his injuries by designing and selling a door that would not operate in extremely cold weather.

Prior to trial, Appellant and Giant Eagle entered into a release pursuant to the Uniform Contribution Among Tortfeasors Act*fn1 (UCATA) for $22,500.00. The terms of the release discharged Giant Eagle from any actions, claims

[ 513 Pa. Page 484]

    and demands in consequence of the accident which occurred on January 17, 1977, and provided that any recovery Appellant would obtain against any person other than Giant Eagle on account of the accident would be reduced to the extent of Giant Eagle's pro rata share of such damage as may be attributed to Giant Eagle of Appellant's damages recoverable against all the tortfeasors.

At trial, a jury found Appellant's damages to be $31,000.00, and apportioned negligence between Giant Eagle (60% causally negligent) and Stanley (40% causally negligent). Based on the allocation of negligence, Giant Eagle's pro-rata share of the damages was $18,600.00 and Stanley's was $12,400.00. Appellant was found to be free of contributory negligence.

Stanley filed a timely post-trial motion seeking to mold the verdict, which was denied. Stanley then entered judgment on the verdict and claimed that since Appellant received $22,500.00 from Giant Eagle by the terms of the release, Stanley was only required to pay to Appellant $8,500.00 (the difference between the verdict of $31,000.00 and the $22,500.00 settlement received), notwithstanding Stanley's liability of $12,400.00 (40% of $31,000.00). The trial court agreed with Stanley, and by its order of March 2, 1982, directed the Prothonotary to mark the judgment against Stanley satisfied upon its payment of $8,500.00. Appellant took an appeal to Superior Court, arguing that the Comparative Negligence Act*fn2 has modified the law with respect to contributions among tortfeasors under the UCATA so that he is entitled to 40% of the verdict from Stanley regardless of the settlement made with Giant Eagle. The Honorable John Brosky, writing for the Superior Court panel, affirmed the trial court, relying on this Court's prior decision in Daugherty v. Hershberger, 386 Pa. 367, 126 A.2d 730 (1956), and the companion Superior Court Case of Mong v. Hershberger, 200 Pa. Superior Ct. 68, 186 A.2d 427 (1962). In Daugherty, we interpreted Section 4 of the UCATA to require that a verdict winner's claim against all

[ 513 Pa. Page 485]

    tortfeasors must be reduced by the amount of the consideration paid for the release by a settling tortfeasor. In Mong, Superior Court permitted the overpaying settling tortfeasor to seek contribution from the non-settling tortfeasor to the extent that the amount paid by the settling tortfeasor exceeded its percentage of negligence.

Under this analysis, since Giant Eagle's liability as determined by the jury was only for $18,600.00, it overpaid its share of liability by $3,900.00 and, therefore, had a right of contribution from Stanley for that amount to the exclusion of Appellant.

Appellant sought review of Superior Court's opinion with this Court, and renews his arguments that the Comparative Negligence Act has modified the effect of tortfeasor releases executed pursuant to the UCATA so that he is entitled to keep all of the consideration paid by Giant Eagle in its release, and also is entitled to recover the $12,400.00 from Stanley as its judicially determined percentage of liability to him. Allocatur was granted because of the importance of addressing these issues and re-examining our decision in Daugherty and Superior Court's Mong decision in light of the Comparative Negligence Act. Like the majority, I conclude that the comparative negligence statute has modified UCATA so as to alter the effect of a release as to a non-settling tortfeasor and agree that we must reverse Superior Court and in the process bury Daugherty and Mong forever.

Before discussing the effect of the Comparative Negligence Act on the UCATA, it is important to set out the basic rules of tort law as they existed in Pennsylvania before these statutes were enacted, and to determine how, if at all, these earlier rules of law have been affected since Comparative Negligence became the law of our Commonwealth.

At common law, it was acknowledged as an undoubted rule of law that where one suffered injury through the mutual or concurrent negligence of two or more persons, they were jointly liable and could be sued for the damages

[ 513 Pa. Page 486]

    sustained, jointly or severally at the option of the party injured. If the injured party by his own negligence contributed to his own injury, however, the law would not afford him any remedy whatsoever against any or all of the persons whose wrong, in concurrence with his own, caused the injury. Borough of Carlisle v. Brisbane, 113 Pa. 554, 6 A. 372 (1886); Railroad v. Norton, 24 Pa. 465 (1855); Railroad Co. v. Aspell, 23 Pa. 147 (1854); Wynn v. Allard, 5 Watts and Serg 524 (1843); Simpson v. Hand, 6 Whart 320 (1840).

Additionally, when an individual was injured by the negligence of more than one and recovered damages against them, he could proceed against any one for payment of the whole judgment. Such payment would operate as a satisfaction to the injured party and would release all others liable for the same injury. Hilbert v. Roth, 395 Pa. 270, 149 A.2d 648 (1959); Anstine v. Pa.R.R. Co., 352 Pa. 547, 43 A.2d 109 (1945); Thompson v. Fox, 326 Pa. 209, 192 A. 107 (1937); Mason v. C. Lewis Lavine, Inc., 302 Pa. 472, 153 A. 754 (1931); Smith v. Roydhouse, Arey and Co., 244 Pa. ...


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