Court Opinion

ID: 9588447
Source: CourtListenerOpinion
Date Created: 2023-08-21 23:34:33.94825+00
Date Added: 2024-06-11T18:00:58.865936
License: Public Domain

ELLETT, Justice
(Dissenting) :
I am unable to agree with the holding of the main opinion. While it is true that the agent and the principal are not joint tort-feasors, yet they are jointly liable, the agent because of his wrongful conduct and the principal because of a rule of law (re-spondeat superior).
There is a split in the authorities as to whether a release of or a covenant not to *115sue one primarily liable will also release another who is jointly liable for the same tort. The annotation in 20 A.L.R.2d at page 1044 lists Georgia, North Carolina, and Ohio as holding that the release of the agent will also release the principal. The annotation lists California, Illinois, Kentucky, and Michigan as holding that it docs not release the principal. In addition to the jurisdictions there cited, there are Federal cases holding that the liability of the principal is not affected by a release of the agent.
The case of United States v. First Security Bank, 208 F.2d 424, 42 A.L.R.2d 951, was decided under Utah Law. The plaintiff there sued the United States under the Tort Claims Act after giving a covenant not to sue the negligent agent. The identical argument was there made by the Government as that adopted in the majority opinion in this case. The Court of Appeals (10th Cir.) rejected that argument and permitted the judgment against the Government to stand.
The case of Williams v. Marionneaux, 240 La. 713, 124 So.2d 919 (1960), permitted the employer to be held where an agreement to save the employee harmless was made.
In Holcomb v. Flavin, 62 Ill.App.2d 245, 249, 210 N.E.2d 565, 567 (1965), the plaintiff gave a covenant not to sue the agent, then sued the principal. There was a summary judgment given in the trial court for the defendant, which was reversed on appeal, the court there saying:
We differ with the conclusion reached by the trial court. The fallacy common to the cases above cited is best illustrated by the language of the opinion in Bacon v. United States wherein the court at page 884, of 321 F.2d, stated that when the servant is not liable, the master should not be liable, and that it matters little how the servant was released by liability. In our opinion it matters greatly how the servant’s liability was extinguished. Where the master’s liability rests solely on respondeat superior, if the servant is exonerated by trial on the merits, then, of course, the master cannot be held liable, but there is no logical or legal basis for extending the rule to-situations where a servant terminates his liability by obtaining a covenant not to sue. .
The case of Ellis v. Jewett Rhodes Motor Company, 29 Cal.App.2d 395, 84 P.2d 791 (1938), was one where the plaintiff gave a covenant not to sue the agent, the driver of a motor vehicle, and then sued the principal. The judgment against the principal was affirmed on appeal.
In Boucher v. Thomsen, 328 Mich. 312, 321, 322, 43 N.W.2d 866, 870 (1950), there was a suit filed by the plaintiff against the principal and the agent, who was driver of *116a motor vehicle. While the action was pending, a covenant not to sue was given to the agent. The trial court dismissed as to the principal, and the Supreme Court reversed, saying:
We think the above decisions indicate the correct rule of law to be applied in the case at bar. The express language of the covenant leaves no question as to what the parties thereto actually intended. If liability on the part of defendant Franck is enforced, he may assert, and perhaps maintain, a claim that he is entitled to reimbursement from Thomsen and Plemel. As before pointed out, it must be assumed that the parties to the covenant had such possible situation in mind when they executed their agreement. We are not entitled to speculate as to their reasons or motives in the matter, but they have not sought to void the undertaking and presumably it is in accordance with their deliberate conclusions as to the proper course to follow. It is our conclusion that the covenant may not be given the effect of precluding the prosecution of the action against the defendant Franck. His motion to dismiss should have been denied.
It seems to me that the better reasoned cases permit a recovery against the principal, and in Utah such recovery is permitted by statute. Section 15-4-4, U.C.A.1953, provides clearly that the release of “one or more of joint or of joint and several obli-gors, shall not discharge co-obligors against whom the obligee in writing and as part of the same transaction as the release or discharge expressly reserves his rights;
There is no distinction in this statute between those who are primarily liable and those who are secondarily liable. The statute simply provides that an obligee can do exactly what the plaintiff in the instant matter did do and this without losing his rights to sue the co-obligor.
The plaintiff did not really release the agent. He merely covenanted never to sue him or to cause him to be sued. If it be thought that by suing the principal a cause of action arises in favor of the principal and against the agent, still the agreement is between the plaintiff and the agent, and this defendant has no rights under it. The agent specifically agreed that the plaintiff was reserving all of his rights against defendant herein under the cause of action which had then been pending for some seven and a half months.
The agent must have known that he might be called upon to reimburse his principal in case the plaintiff might recover and collect a judgment in excess of the settlement figure. For reasons best known to himself, he assumed this risk. It may be that he thought his principal would never be called upon to satisfy any judgment rendered against him. It may be that he *117thought the plaintiff could not recover at all. It may be that he thought defendant’s insurance carrier (if any it has — and which employer does not have one) would settle with the plaintiff as did his own carrier. At any rate, he was willing to settle his liability, if any there was, by allowing his insurance carrier to furnish the money for the covenant given to him.
Even if a judgment is rendered against the defendant in excess of the amount of the settlement with the agent and it has to pay that excess judgment, there is no sub-rogation by defendant to the plaintiff’s rights against the agent. All rights of the plaintiff would be settled by the payment of the judgment. The innocent principal would simply have an action against the errant agent for reimbursement for any sum which it might be called upon to pay because of the wrongdoing of the agent.
If the covenant not to sue be interpreted to hold the plaintiff responsible for causing an action to be filed against the agent, surely the principal (this defendant) should not be concerned with whether or not the agent sues the plaintiff for breach of covenant. That simply is no concern of this defendant.
The agent by his agreement was willing to take the risk of reimbursing this defendant, and he is not now evidencing any concern about it. I think this court should not concern itself about the possibility that the agent might have to pay the defendant in some future action. I, therefore, would follow the plain wording of the statute and then in the words of the great Bard say, “Mischief, thou art afoot, take thou what course thou wilt.”1
TUCKETT, J., concurs in the dissenting opinion of ELLETT, J.'

. Julius Caesar, Act 3, Scene 2.