Court Opinion

ID: 5955306
Source: CourtListenerOpinion
Date Created: 2022-01-13 06:36:11.513474+00
Date Added: 2024-06-11T08:47:55.793175
License: Public Domain

Asch, J.
(dissenting). This action was commenced to recover damages for wrongful death, pain and suffering and loss of consortium, resulting from the death of Saul Didner as the result of his exposure to asbestos. The trial was partitioned into different phases. Thus, in the first phase, the jury was to determine the medical causation and the damages incurred. Immediately thereafter, the jury was presented with the liability issues, i.e., product identification, liability and apportionment among the various defendants. On June 27, 1990, the jury returned a verdict of $3,250,000 for pain and suffering and $1,117,353 for pecuniary loss, as a result of Mr. Didner’s death. It also awarded plaintiff Marlene Didner $1,500,000 individually for loss of consortium for a total award of $5,867,353. At a later date, the trial court reduced the verdict to $2,300,000 for pain and suffering and $500,000 for loss of consortium, for a total of $3,917,353.
*27On June 28, 1990, the liability phase of the trial commenced before the jury. On July 10, 1990, the jury returned a verdict apportioning liability among settled and nonsettled defendants. Defendant Manville (Manville Asbestos Disease Compensation Fund, created as a result of the bankruptcy of Johns-Manville Company to pay claims of asbestos plaintiffs against the Johns-Manville Company) was found to be 60.167% responsible for the damages and defendant-appellant Keene Corporation was assessed 15% of the total amount. The final judgment, entered February 5, 1991, which defendant Keene appeals from, required Keene to pay 15% of the total reduced judgment of $3,917,353, plus interest, or $618,452, without any setoff for the percentage of the liability assessed against defendant Manville.
The first issue we are presented with is whether there was a settlement within the spirit and letter of General Obligations Law § 15-108 between plaintiff and defendant Manville. If so, then defendant Keene should have been allowed a setoff for the amount of the settlement or the percentage of liability assessed against Manville.
Section 15-108 is entitled "Release or covenant not to sue”. It provides as follows:
"(a) Effect of release of or covenant not to sue tortfeasors. When a release or a covenant not to sue or not to enforce a judgment is given to one of two or more persons liable or claimed to be liable in tort for the same injury, or the same wrongful death, it does not discharge any of the other tortfeasors from liability for the injury or wrongful death unless its terms expressly so provide, but it reduces the claim of the releasor against the other tortfeasors to the extent of any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, or in the amount of the released tortfeasor’s equitable share of the damages under article fourteen of the civil practice law and rules, whichever is the greatest.
"(b) Release of tortfeasor. A release given in good faith by the injured person to one tortfeasor as provided in subdivision (a) relieves him from liability to any other person for contribution as provided in article fourteen of the civil practice law and rules.
"(c) Waiver of contribution. A tortfeasor who has obtained his own release from liability shall not be entitled to contribution from any other person.”
*28Plaintiff contends that several defendants settled prior to verdict but that defendant Manville entered into a consent judgment following the verdict of June 27, 1990, in the sum of $800,000. Plaintiff asserts that while she settled with other defendants, she insisted on taking a judgment against Man-ville, and that since Manville fully participated in the case, and the judgment was obtained following the jury’s verdict, it preserved the plaintiff’s ability to obtain a full recovery.
The problem with this analysis is that it ignores the bifurcated nature of the trial. The record clearly shows that plaintiff settled after a jury verdict — that of June 27th. However, this verdict was simply for the amount of damages including pain and suffering resulting from Saul Didner’s exposure to asbestos. On July 5, 1990, before the conclusion of the liability and apportionment phase of the trial, plaintiff represented to the court that she had settled with, among others, Manville. Thus the trial transcript, part of the record before us on this appeal, at pages 405-406, reads, inter alia, on that date:
“the court: The plaintiffs in the Didner case, have settled at this time with Owens Corning, Fiberboard—
“the court: We are going to lose Mr. Taber?
“mr. Gordon: Fiberboard and Pittsburg-Corning. Eagle-Pitcher, Manville Asbestos Disease Compensation Fund, National Gypsum, U.S. Gypsum, GAF and Armstrong.
“We are still open against Keene, H.K. Porter and Westinghouse.” (Emphasis added.)
Thus, on July 5, 1990, plaintiff’s counsel made a clear, unambiguous statement on the record in open court that the matter had been settled with Manville, precluding further suit against that defendant (see, Lettiere v Martin El. Co., 62 AD2d 810, affd 48 NY2d 662). The majority opinion makes much of the fact that plaintiff and Manville entered into a "consent judgment”, which did not provide for a release of Manville or a discontinuance of the action with prejudice. However, there is no dispute that plaintiff, on July 5, 1990, in open court, stipulated she "settled” with Manville, and that the case was still “open” only with respect to three defendants, including appellant. This settlement in open court was sufficient to bind plaintiff (see, CPLR 2104; Matter of Dolgin Eldert Corp., 31 NY2d 1). Moreover, the very fact that the parties later formalized their valid, open-court settlement by entering a "consent judgment” explains any lack of formal *29release or discontinuance against defendant Manville. A judgment would, of course, effectively end any action. The date of this purported "consent judgment”, again emphasized by the majority opinion, is of no importance, since the written agreement simply memorialized what had been agreed upon by the plaintiff and defendant Manville on July 5, 1990 in open court, and the settlement was effective as of that date.
On July 10, 1990, after this announced settlement, the jury returned a verdict apportioning liability among the settled and nonsettled defendants finding Manville 60.167% and Keene 15% liable.
If, subsequent to a verdict and judgment, plaintiff releases a tortfeasor, the discharge of that tortfeasor will not affect the liability of other defendants. (See, Cover v Cohen, 113 AD2d 502, 507-508.) However, a discharge of a defendant prior to a verdict apportioning liability, whether denominated a "release”, a "settlement” or a "consent judgment”, will not obviate the application of the provisions of section 15-108 to the recovery against the nonsettling defendants. Thus, Makeun v State of New York (98 AD2d 583, 591), which dealt with a bifurcated trial, noted that: "the concept of 'liability’ in section 15-108 of the General Obligations Law must include a determination of culpability and damages. Therefore, the * * * settlement, which occurred after an interlocutory judgment as to negligence only, prior to a final judgment which included damages, constitutes a prejudgment settlement subject to section 15-108 of the General Obligations Law.” (See also, Lettiere v Martin El. Co., supra, 62 AD2d 810, affd 48 NY2d 662.)
The cases relied upon by plaintiff are inapposite. Thus, in Rock v Reed-Prentice Div. (39 NY2d 34), the Court of Appeals found that a manufacturer who settled with a plaintiff after a judgment still retained a right of contribution against the employer. Here, the plaintiff settled before the jury verdict as to liability was entered or even returned. Likewise, in De Sano v Tower (129 AD2d 976), plaintiff was shot in the eye with a pellet gun by defendant Tower. The gun was purchased from defendant Saunders. Prior to trial, plaintiff discontinued his action against Saunders, but did not release her from liability, and the Fourth Department accordingly held that the discontinuance constituted neither a release nor a covenant not to sue and plaintiff’s claim should not therefore have been reduced pursuant to section 15-108. The Court reasoned that since plaintiff did not settle with Saunders, he could have *30recommenced another action at any time prior to the running of the Statute of Limitations. Here, of course, after the settlement reached by plaintiff and Manville, prior to the jury verdict apportioning damages, Manville was relieved of the risk of any further lawsuits by plaintiff and is immune from the claims of codefendants in contribution.
Plaintiff makes much of the fact that the $800,000 settlement reached with Manville "may or may not be collectable”. The trial court also noted, in denying defendant’s motion to vacate the February 5, 1991 judgment, that Manville would not pay its share and that someone had to pay Manville’s share. This was probably factually in error, but, in any event, clearly erroneous as a matter of law. Thus CPLR 1601 (1) provides, inter alia, that "the culpable conduct of any person not a party to the action shall not be considered in determining any equitable share herein if the claimant proves that with due diligence he was unable to obtain jurisdiction over such person in said action” (emphasis added).
However, Manville took part in this litigation, being represented by counsel, who in fact delivered the "main summation” at the damages phase of the trial, on behalf of all defendants. Moreover, when plaintiff settled for the $800,000 with Manville, she was aware of the difficulties she faced dealing with the Manville Fund at that time. The defendant asserts, moreover, that under the settlement of the Manville class action in Federal court, plaintiff’s settlement with Man-ville in the form of a consent judgment will be paid in full. In any event, as noted by Judge McLaughlin of the Second Circuit, sitting by designation on the District Court, in a case also involving a settlement with Manville: "It is reasonable to infer that those dealing with the Manville trust at the time of this litigation were well aware of its financial problems. Indeed, it is likely that plaintiff knew this simply by virtue of accepting a settlement with staggered payments. Even without such insights, '[ejquity will not relieve a party of its obligations under a contract merely because subsequently, with the benefit of hindsight it appears to have been a bad bargain.’ Raphael v. Booth Memorial Hospital, 67 A.D.2d 702, 703 [other citation omitted].)” (In re Joint S. & E. Dist. Asbestos Litig. [Gallin v Owens-Ill., Inc.], 760 F Supp 33, 35.)
The trial court’s decision, here, shifted the burden of plaintiff’s settlement risks to defendant Keene, which was not only inequitable but diametrically opposed to the spirit and purpose of General Obligations Law § 15-108.
*31The second issue, which must be decided since General Obligations Law § 15-108 does apply, is how the appropriate setoff to Keene should be calculated. The plaintiff asserts that the statute does not "directly speak” to this question. However, subdivision (a) of the statute provides, in pertinent part, that the release "reduces the claim of the releasor against the other tortfeasors to the extent of any amount stipulated by the release * * * or in the amount of the consideration paid for it, or in the amount of the released tortfeasor’s equitable share of the damages * * * whichever is the greatest.”
Applying this statutory formula to the present case, defendant Keene’s 15% share should have been allowed appropriate setoffs for settlements from the settling codefendants including either the $800,000 Manville settlement or the "equitable share of the damages”, i.e., 60.167% of the total verdict of $3,917,353 which was $2,356,953.80. Plaintiff takes the position that the defendant may not "pick and choose” as to the manner in which the statute is applied but that Keene must aggregate all settling defendants by percentages of fault or by settlement amounts in dollars, and a majority of this Court agrees with that position, albeit in dicta. "[C]ontrary to plaintiff’s argument that [defendant] must choose with respect to all settling defendants between credit for their equitable liability or the amount paid in settlement, it is clear that the statute imposes no such requirement. The term 'tort-feasor’ is used in the singular and the nonsettling defendant is entitled to credit, with respect to each defendant tort-feasor, for the greater of either the amount paid or the equitable liability. Plaintiff argues that, here, such application of General Obligations Law § 15-108 gives defendant BTK 'a free ride’, i.e., it is required to pay only $10,000 although its equitable liability was found to be 35% of $2,600,000 or $910,000. The 'free ride’ results not solely from the operation of the statute but from the settlements reached by plaintiff with the other defendants. If those settlements had totaled $2,600,000 or more, defendant BTK would have an even freer ride, it would pay nothing. Plaintiff and her attorney made certain decisions concerning the wisdom of accepting a number of settlement offers. In making those decisions plaintiff’s attorney was, or should have been, aware of the provisions of General Obligations Law § 15-108, and the impact of those provisions on the amount which the nonsettling defendant might be required to pay after jury verdict.” (Williams v Niske, 147 Misc 2d 556, 559-560, mod 181 AD2d 307.)
*32These principles enunciated by Justice Gammerman in the New York County Supreme Court, while rejected by this Court in Williams v Niske (181 AD2d 307, supra, lv granted 186 AD2d 1099) and a majority herein, appear to me to adhere to the literal meaning and intent of the statute.
As the IAS Court in Williams (supra, at 558) recognized, courts construing this statute have uniformly held that non-settling defendants are entitled to reduce the recovery against them by the full amount of any settlement even if the settling party was found later to be not liable (Werner v Our Lady of Lourdes, 60 AD2d 791) or by the equitable share of the damages attributable to the settling party, even if that party settled without paying any consideration (Killeen v Reinhardt, 71 AD2d 851). Judge McLaughlin in Gallin (supra) is in accord with this defendant-by-defendant calculation of section 15-108 setoffs. In fact, the Trial Judge in the case before us has previously written: "For the reasons articulated in Williams v Niske (supra), Gallin v Owens-Illinois, Inc. (supra) and Killeen v Reinhardt (supra), this court holds that nonsettling defendants are entitled to consider each settling defendant against whom a percentage of liability was assessed or who paid consideration individually and offset the higher amount in each case.” (Matter of New York City Asbestos Litig., 151 Misc 2d 1, 6.) In a learned opinion in the Federal court, relied upon by the majority opinion, Judge Jack Weinstein agreed that the plaintiffs’ method of adding separately the value of the settlements and the value of the apportioned shares of liability and then deducting the larger of these two totals from the verdict owed by nonsettling defendants appeared to more closely "fulfill the equitable goals of the statute” (In re Eastern & S. Dists. Asbestos Litig., 772 F Supp 1380, 1393). However, in a review of the applicable case law, Judge Weinstein also came to the conclusion that both the State and Federal courts which have considered the issue have adopted the defendants’ position and asserted "[a]t the moment this court must assume that the New York Court of Appeals would follow the holdings of the lower state courts on this issue. The initial statutory interpretation by the state and federal courts has now developed into an unmistakable jurisprudential trend that this court cannot lightly disregard.” (Supra, at 1397.)
In the calculations using these principles, the reduced verdict must be further reduced by the amount of settlements by the other defendants other than the Manville Fund ($2,500,000). *33This leaves a balance of a little under $1,500,000. However, this in turn is reduced by the greater of either the actual settlement amount ($800,000) agreed to with Manville or the percentage of liability attributed to Manville by the jury ($2,356,953.80). This last reduction leaves defendant-appellant Keene with no liability remaining to plaintiff.
Accordingly, I would modify, on the law, the judgment of the Supreme Court (Helen E. Freedman, J.), entered February 5, 1991, which granted judgment against appellant-defendant Keene Corporation in the total sum of $618,452.10, to vacate the award against defendant.
Milonas, J. P., Kupferman and Kassal, JJ., concur with Ellerin, J.; Asch, J., dissents in a separate opinion.
Judgment, Supreme Court, New York County, entered February 5,1991, is affirmed, without costs.