Opinion ID: 2276662
Heading Depth: 2
Heading Rank: 1

Heading: Paul's Appeal (96-CV-1495): Pro Tanto v. Pro Rata Credit.

Text: A pro tanto credit is based on the actual settlement amount, dollar-for-dollar,while a pro rata credit is based on proportionate shares of liability among joint tortfeasors. See Berg v. Footer, 673 A.2d 1244, 1248-49 (D.C.1996). Appellant Paul opposes the application of a pro tanto credit of the settlement amount against the verdict on the ground that it results in the unjust enrichment of a nonsettling defendant, such as Dr. Bier, when, as here, the amount of the verdict equals the amount of the settlement the plaintiff reached with another defendant. In addition, Paul asserts that a pro rata credit is appropriate in this case because only one of her two liability claims was submitted to the jury, and therefore the jury verdict represented only one-half of the damages arising from these claims. The question of [h]ow to credit the judgment entered upon a jury verdict against a nonsettling defendant with the proceeds a settling defendant paid to the plaintiff is purely a question of law, which this court reviews de novo. Berg, 673 A.2d at 1247 (citing Bertram v. Freeport McMoran, Inc., 35 F.3d 1008, 1019 (5th Cir.1994)). We stated in Berg that a nonsettling defendant is entitled to a pro tanto credit for the amount paid by settling defendants who are not joint tortfeasors, see 673 A.2d at 1245, and to a pro rata credit based on the nonsettling defendant's right of contribution against a settling joint tortfeasor, see id. at 1248. Paul's complaint alleged that separate acts of negligence by Dr. Druy, a GWU employee, and Dr. Bier, her private physician, combined to proximately cause injury, namely post-phlebitic syndrome, as a result of vascular damage to her left leg. After presenting her case to the jury against all the defendants, Paul settled her negligence claim against GWU, and its employee, Dr. Druy, for $2,000,000, and they were dismissed as defendants in the case. The jury then found in favor of Paul against Dr. Bier after finding that Dr. Bier's actions were a proximate cause of Paul's injuries, and awarded her $2,000,000 as compensation for her injuries. Paul's claim that the jury verdict compensated for damages solely attributable to Dr. Bier, i.e., that it was not intended as full compensation for her injuries, is not borne out by the record. [5] The jury valued all of Paul's injuries at $2,000,000 and assessed those damages as attributable to Dr. Bier's negligence. Paul received $2,000,000 as a result of the settlement agreement with GWU. Thus, Paul was satisfied by the settlement to the full extent of the damages found by the jury. Notwithstanding that she has received compensation to the full extent of the jury's $2,000,000 verdict, Paul contends that she is entitled to the benefit of a pro rata credit under our Berg opinion. We recognize that Paul would have benefitted if the trial court had applied a pro rata rather than a pro tanto credit, in that Dr. Bier would have been required to pay Paul an additional $1,000,000, [6] reflecting his proportionate share of liability. In Berg, this court applied a pro rata credit, which in the circumstances of that case resulted in total compensation to the plaintiff in excess of the jury's verdict, [7] noting that the law contains no rigid rule against overcompensation. Id. at 1256 & n. 19 (quoting McDermott, Inc. v. AmClyde and River Don Castings Ltd., 511 U.S. 202, 219, 114 S.Ct. 1461, 128 L.Ed.2d 148 (1994)). This holding, however, was not based on the rationale that the plaintiff was entitled to compensation in excess of the jury's verdict, but rather that, in spite of that consequence, consistency with established precedent applicable to settlements with joint tortfeasors weighs in favor of applying a pro rata credit to the jury verdict even though the nonsettling defendant's pro rata contribution to the amount of the jury verdict, when added to the amounts recovered in settlement, will result in a plaintiff's recovery that exceeds the verdict. Berg, 673 A.2d at 1257. The court expressly declined to make application of a pro rata credit depend on the relative settlement and verdict amounts in an individual case, noting that [m]aking particular credit rules contingent upon the relative amounts of the settlement and the jury's verdict . . . would only increase uncertainty and make it even more difficult for litigants to negotiate settlements. Id. But see Rose v. Associated Anesthesiologists, 163 U.S.App.D.C. 246, 250, 501 F.2d 806, 810 (1974) (limiting the amount of pro tanto credit so as to assure that the defendant held liable in the litigation does not pay less than his equitable [ pro rata ] share). [8] In short, the injured patient in Berg was no more than an incidental beneficiary of this court's decision to adhere to the rule that when a settling defendant is a joint tortfeasor, the nonsettling defendant is entitled to a pro rata credit against the jury's verdict. See Berg, 673 A.2d at 1257 (citing Martello v. Hawley, 112 U.S.App.D.C. 129, 132, 300 F.2d 721, 724 (1962)). Although application of a pro tanto credit means that the plaintiff will not receive a windfall benefit, the court's decision to apply a pro tanto credit in no way reduces that to which the plaintiff is entitled, compensation in the amount awarded by the jury. Whether Paul will receive that windfall depends exclusively on whether a pro rata credit should have been applied in order to vindicate the right of contribution between the settling and nonsettling defendants as joint tortfeasors. We now turn to that issue. [9] A threshold obstacle to Paul's claim that a pro rata credit should have been applied to the verdict rendered against Dr. Bier is the absence of either a judicial determination or a stipulation, see Berg, 673 A.2d at 1251 & n. 13; Lamphier v. Washington Hosp. Ctr., 524 A.2d 729, 733 & n. 5 (D.C.1987), that GWU is a joint tortfeasor with Dr. Bier. Because GWU settled mid-trial and was dismissed from the case, and it did not raise the issue of contribution until after the jury's verdict, see infra, there was no court adjudication that GWU and Dr. Bier were joint tortfeasors. GWU's post-trial unilateral acknowledgment of liability in its cross-claim for contribution, is not supported by any stipulation [10] and is contradicted by its blanket denial of liability in the settlement agreement. See supra note 3. As we have explained, for a nonsettling defendant to receive a pro rata credit, the liability of the settling defendants must be established either by adjudication or by stipulation between the plaintiff and the settling party. See Shannon, supra note 9, 696 A.2d at 1367 (citing Berg, 673 A.2d at 1251 & n. 13); Washington Hosp. Ctr., supra note 5, 722 A.2d at 336 (noting the essential prerequisite for entitlement to contribution is that the parties be joint tortfeasors in the sense that their negligence concurred in causing the harm to the injured party) (citations omitted); Washington, supra note 9, 579 A.2d at 187 (explaining that the right to contribution is contingent upon a finding of joint liability); Lamphier, 524 A.2d at 733 & n. 5 (noting that the liability of the settling tortfeasor must be judicially established as a predicate to asserting the right to contribution) (citing Otis Elevator Co. v. Henderson, 514 A.2d 784, 786 (D.C. 1986) (per curiam)). As Paul's argument for a pro rata credit derives from the right to contribution of the joint tortfeasors, the same requirement applies if the plaintiff, rather than the nonsettling defendant, requests a pro rata credit. In the absence of either an adjudication or stipulation that GWU and Dr. Bier were joint tortfeasors, the trial court did not err in granting Dr. Bier's request to apply a pro tanto credit. [11] Cf. Berg, 673 A.2d at 1250-51 (stipulation sufficient where the settling tortfeasor admitted to liability in pretrial statement stipulation of facts to the court and [a]ll parties, including [nonsettling tortfeasor] agree that [settling tortfeasor's] stipulation of liability is enough to make it a joint tortfeasor).