Opinion ID: 1221949
Heading Depth: 1
Heading Rank: 5

Heading: the set-off problem

Text: Under the provisions of W.Va.Code, 55-7-6, [24] the jury may allocate the distribution of the wrongful death award to the beneficiaries. In this case, the jury awarded 75% of the damages to the deceased's son and 25% to the deceased's spouse, Mr. Roberson, who was the driver of the pick-up truck and the third-party defendant. As previously discussed, Mr. Roberson's negligence in the third-party action was set at 30%. The total award to the plaintiff was set at $100,000. Therefore, Mr. Roberson's share of the liability under comparative contribution would be $30,000. Anchor would like to set-off against the $25,000 it owes to Mr. Roberson (on the $100,000 jury award) the $30,000 for which he has been found liable to Anchor in the third-party action. The question of the right of a defendant in a tort case to set-off a judgment he has obtained against the plaintiff on an opposite judgment the plaintiff has obtained against him when insurance is involved has been the subject of some commentary [25] and has been treated in two jurisdictions. Jess v. Herrmann, 26 Cal.3d 131, 161 Cal.Rptr. 87, 604 P.2d 208 (1979); Stuyvesant Insurance Company v. Bournazian, 342 So.2d 471 (Fla.1977). See also Uniform Comparative Fault Act, 12 U.L.A. § 3 (1982 Cumm. Supp.). In both of these jurisdictions, the courts had previously adopted a pure comparative negligence rule. Both courts concluded that they would not permit a set-off where there was liability insurance coverage. Both courts reasoned that if a set-off were permitted on the judgments so that only a net judgment was payable, then the real beneficiaries of the set-off would be the parties' insurance carriers. [26] This benefit would be contrary to the contractual provisions of the ordinary liability insurance policy requiring the company to pay for damages incurred by its insured and would result in the injured parties receiving less money than the jury had awarded for their injuries. [27] Moreover, both courts indicated that to permit this windfall where insurance is involved would be contrary to the State's financial responsibility law requiring insurance coverage to provide financial protection for damages arising out of accidents. We can accept these policy reasons advanced by the California and Florida Courts for disallowing set-offs on judgments in tort actions where there is underlying insurance coverage. Generally, parties may set-off on judgments obtained against each other. This rule is, however, not a matter of absolute right but subject to the court's discretion. 47 Am.Jur.2d Judgments § 1003 (1969); 49 C.J.S. Judgments § 566(c) (1947). In Nuzum v. Morris, 25 W.Va. 559, 566-67 (1885), we discussed this principle at some length: In Mitchell v. Oldfield, [4 T. R. 123], it is said that the authority of the court to set off opposite judgments did not depend on the statutes of set off but on the general jurisdiction of the court over the suitors in it; that it was an equitable part of this jurisdiction and had been frequently exercised. The same doctrine is strongly and clearly announced in Williams v. Evans, 2 McCord, [203] and in 3 Watts, in Tuck. Com's, and in Montague on Set-Off, [5, 6 and 7]. The courts have been gradually extending this equitable remedy. ( Barker v. Braham, [2 Blackst. 896]); and opposite demands arising upon judgments may on motion be set off against each other, whenever such set-off is equitable, though the judgments are in different courts, and though all the parties to the different records are not the same.... [A]ll applications of this kind, as they are founded on no positive statute or any fixed rule which compels the court to grant them, are addressed to the discretion of the court; ... See also White v. Moss, 88 W.Va. 1, 106 S.E. 72 (1921); Faulconer v. Stinson, 44 W.Va. 546, 29 S.E. 1011 (1898); Payne v. Webb, 29 W.Va. 627, 2 S.E. 330 (1887). In view of the foregoing law, we conclude that there is no right of judgment set-off where in a tort case parties have obtained counter judgments against each other and both parties are fully covered by liability insurance as to such judgments. In the present case, we understand that both Anchor and Roberson have adequate liability insurance and therefore no judgment set-off would be appropriate. [28] The certified questions having been answered, this case is dismissed from the docket. Answered and Dismissed.