Opinion ID: 2609775
Heading Depth: 1
Heading Rank: 3

Heading: Does W.S. 1-1-108 Provide Credit?

Text: The singular question next presented results from an issue we raised and upon which we requested additional briefing and heard argument. It is, does W.S. 1-1-108 (1988) provide for a credit to a party upon a judgment for payments made by another in settlement of the claim of an injured person? Section 1-1-108 provides as follows: 1-1-108. Voluntary partial payment of liability claims. No voluntary partial payment of a claim based on alleged liability for injury or property damage shall be construed as an admission of fault or liability, or as a waiver or release of claim by the person receiving payment. Such payment is not admissible as evidence in any action for the purpose of determining the amount of any judgment, with respect to the parties to the occurrence from which the claim arose. Upon settlement of the claim, the parties may make any agreement they desire in respect to all voluntary partial payments. After entry of judgment, any such payment shall be treated as a credit and deducted from the amount of the judgment. If after partial voluntary payments are made it is determined by final judgment of a court of competent jurisdiction that the payor is liable for an amount less than the voluntary payments already made, the payor has no right of action for the recovery of amounts by which the voluntary payments exceed the final judgment. No voluntary partial payments shall be construed to reduce the amount of damages which may be pleaded and proved in a court proceeding between the parties. [emphasis added] It is with some considerable reluctance that we undertake resolution of the right to credit under W.S. 1-1-108, for perhaps it is no longer an issue presented to us by the parties. Appellants, who would benefit from a credit provided by W.S. 1-1-108, stated candidly in oral argument that they could not in good conscience argue that § 1-1-108 provided credit upon the judgment for payment by Sleeping Indian and Anselmi and, in his brief, stated: Appellants do not contend that Section 1-1-108 of the Wyoming Statutes applies to the payments made by the settling defendants. Appellee also forcefully asserts that W.S. 1-1-108 does not provide credit to appellants upon the judgment for payments by Sleeping Indian and Anselmi. We could stop here, but failure to resolve the issue would be a disservice to citizens and the bar of Wyoming. Before W.S. 1-1-108 became an issue in this case, practitioners in the tort field generally accepted § 1-1-108 as providing a means for a potentially liable defendant or his insurance carrier to pay medical bills and other damages immediately after an injury and during recovery without the necessity of the injured party filing a legal action. The statute is beneficial to an injured party who can receive partial payments of medical bills, lost earnings and other loss promptly without using his own funds, borrowing, or facing bankruptcy for large medical expense he is unable to pay. It is beneficial to the potentially liable party who can aid the injured person during recovery, act reasonably, maintain good relations with the injured person, and perhaps settle the claim, avoiding the substantial cost and expense of litigation and trial. Thus, W.S. 1-1-108, when it uses the plural parties, clearly refers only to the injured party and the payor settling party. There is not a reference or a hint of reference in the language of W.S. 1-1-108 that it also establishes rights of third parties who are not payors and have given nothing to the injured party. The statute then protects the party paying (payor) by providing a credit for all payments and prohibiting use of voluntary payment to establish liability. It protects the injured party in allowing litigation if settlement is not achieved. Yet we must concede that the following language in the statute, [a]fter entry of judgment, any such payment shall be treated as a credit and deducted from the amount of the judgment, taken out of context, can have two meanings. The credit might be available only to the party paying (payor), or credit deducted from the amount of the judgment may refer to any judgment against any other person. If we accept the claim of two possible interpretations, the statute is ambiguous, and we must proceed to ascertain the intent of the legislature in its enactment. Our rules of statutory interpretation and construction are well established. In interpreting statutes, if the statutory language is clear and unambiguous, we must abide by the plain meaning of the statute. Adobe Oil & Gas Corporation v. Getter Trucking, Inc., Wyo., 676 P.2d 560 (1984). If a statute is ambiguous, however, we will resort to general principles of statutory construction in the effort to ascertain legislative intent. State v. Sodergren, Wyo., 686 P.2d 521 (1984). A statute which is uncertain and susceptible of more than one meaning is ambiguous. McArtor v. State, Wyo., 699 P.2d 288 (1985). In addition, we have said that [s]tatutes should be given a reasonable, practical construction. State Board of Equalization v. Cheyenne Newspapers, Inc., Wyo., 611 P.2d 805, 809 (1980). Further, all portions of an act must be read in pari materia, and every word, clause and sentence of it must be considered so that no part will be inoperative or superfluous, Hamlin v. Transcon Lines, Wyo., 701 P.2d 1139, 1142 (1985), and a statute should not be construed to render any portion of it meaningless, Reliance Ins. Co. v. Chevron U.S.A. Inc., Wyo., 713 P.2d 766 (1986), or in a manner producing absurd results, State v. Sodergren, supra. Story v. State, 755 P.2d 228, 231 (Wyo.1988). First, W.S. 1-1-108 discloses an intent to encourage partial voluntary payments by potential tortfeasors to injured persons as a positive step toward settlement of the claim. The statute provides for protection of the parties' interests in that making partial payments and negotiations resulting in such partial payments (a) are not to be construed as an admission of fault; (b) are not admissible as evidence in any action for the purpose of determining the amount of any judgment; and (c) such payments are treated as credits if a larger judgment is entered. A strong public policy has always existed in Wyoming favoring settlement of litigation. Coulter, Inc. v. Allen, 624 P.2d 1199, 1202-03 (Wyo. 1981); Hursh Agency, Inc. v. Wigwam Homes, Inc., 664 P.2d 27 (Wyo.1983). Next, the statute, in providing that partial payments are not admissible in evidence for the purpose of determining the amount of judgment, surely would refer to a judgment against the payor and evidences a legislative intent that credit only belongs to a defendant who makes the voluntary partial payment. Other defendants would have no need to be protected from the use of the voluntary payment in determining the amount of the judgment. Indeed other defendants might want to use evidence of such payments to shift liability and fault to codefendants. The next clear indication of legislative intent that this statute applies only between a party paying and a party being paid is found in the language dealing with voluntary payments that are less than the amount of the judgment and voluntary payments which exceed the amount of the judgment. If the voluntary payments are less than the amount of the judgment, clearly it is the payor who is entitled to credit for his payments. And if the amount of the judgment is less than the voluntary payments, it is the payor who is clearly identified as having no right of credit or recovery back. Thus, W.S. 1-1-108 specifically states: If after partial voluntary payments are made it is determined by final judgment of a court of competent jurisdiction that the payor is liable for an amount less than the voluntary payments already made, the payor has no right of action for the recovery of amounts by which the voluntary payments exceed the final judgment. [emphasis added] The specific use of the term payor suggests that, throughout the statute, reference to parties is a reference to payors, i.e., parties paying, and refers to the amount of a judgment entered against a payor. The payor under the statute must remain in the case for there to be a judgment against him, and it would be strange indeed if his voluntary payment was credited against the total judgment and not first against his portion thereof. Thus, the clear legislative intent is that the voluntary payments accrue only to the benefit or detriment of the payor of voluntary payments. The statute makes no mention of third parties who pay nothing as being either benefitted or harmed by the party paying and the injured party. The statute specifically provides that the person who made the voluntary payments (payor) cannot recover the excess amount of the payments (surely a windfall to the injured party). It stretches credulity to even suggest that, in spite of a prohibition against getting back an overpayment of total damage, it would be proper for other defendants, who chose not to make any such payments, to be able to recover the same sum by means of a deduction from the amount of the judgment. The statute, when read in its entirety and in view of its purpose, demonstrates a clear legislative intent that credit for voluntary payments be made only against the amount of the judgment entered against a payor.