Of the many pieces of tort reform legislation to emerge from the 2015 West Virginia Legislature, one of the most important was HB 2002, which becomes effective on May 25, 2015. HB 2002 substantially changes West Virginia’s comparative fault regimen and abolishes joint and several liability by repealing two code sections: W.Va. Code §§55-7-13 and 55-7-24; and adding four new sections: §55-7-13a, 55-7-13b, 55-7-13c, and 55-7-13d.

What do you need to know?

  • The doctrine of modified comparative fault is codified in W.Va. Code 55-7-13a. Liability is allocated to each applicable person in proportion with the percentage of fault assessed against them by the jury.
  • Fault is defined as an act or omission which is the proximate cause of an injury or death. It includes, but is not limited to, negligence, malpractice, strict or “absolute” liability, assumption of risk, and liability injuries caused to an employee by an employer’s “deliberate intent” as that is defined in W.Va. Code 23-4-2.
  • New W.Va. Code §55-7-13c abolishes joint and several liability and provides that a defendant is only liable for the amount of compensatory damages allocated to him in proportion to his percentage of fault.   There are several exceptions to the new rule of several liability.  Liability may be joint if:

The conduct that is the proximate cause of damages constitutes driving under the influence of drugs and/or alcohol;

Conduct that is the proximate cause of damages constitutes criminal conduct; or

Conduct that is the proximate cause of damages constitutes illegal disposal of hazardous waste.

  • It remains the case that a plaintiff found to be more than 50% at fault cannot recover.
  • If a plaintiff cannot recover from a liable defendant, there is a procedure for reallocation of uncollectible amounts, which is set forth in W.Va. Code §55-7-13c(d). This provision provides that:

A plaintiff must move for reallocation within 1 year of judgment becoming final;

Upon motion, the Court must determine if all or part of a defendant’s share of a verdict is uncollectible.

The uncollectible amount is to be reallocated among parties found to be liable, including a plaintiff at fault. This means that an uncollectible amount is reduced by the percentage of fault attributed to a plaintiff.

No uncollectible amount may be reallocated to any defendant that is greater than the uncollectible amount multiplied by the defendant’s percentage of fault.

There is no reallocation against a defendant whose percentage of fault was equal to or less than the plaintiff’s.

  • One of the most important changes is set forth in new W.Va. Code §55-7-13d, which allows a jury to consider the fault of all potentially liable parties, regardless of whether the person was or could have been named a party. i.e., you can now “try the empty chair.” This provision specifically provides:

The fault of non-party may be considered if: 1) plaintiff settled with the non-party, or 2) the defendant provided notice no later than 180 days after service of process that a non-party was at fault. Notice must be served on all parties and filed with the court. The non-party’s name, last known address or best possible identification must be given.

Thus, if a plaintiff settled with a party before filing suit or before trial, that settling party may still be on the verdict form and fault may be assessed against him. The plaintiff’s verdict is then reduced not by the amount of the settlement, which is the current rule, but by the amount of fault assessed by the jury against a settling party.

Any recovery is reduced by the percentage of fault chargeable to the non-party;

Fault assessed against non-parties does not subject that party to liable, may not be used as evidence, and is not admissible in any other action.

  • Fault may still be imputed to parties if it is permitted by statute of common law (i.e. master/servant).
  • A defendant cannot be liable if the damages suffered arise out of the plaintiff’s commission, attempted commission, or fleeing from the commission of a felony.

HB 2002 presents several new concerns for litigants:

  • First, defendants no longer need to file third-party complaints against non-parties if they wish to assert claims for contribution in order to have fault assessed against other potentially liability parties as defendants may not give notice that they intend to have the fault of nonparties considered. This may result in plaintiffs suing all potentially liability parties at the outset of litigation.
  • Second, the statutory changes may discourage settlements in multi-defendant cases that are not global as settling defendants will still remain on the verdict form for assessment of fault and the recovery is reduced not by the amount of settlement, but by the amount of fault against a settling party. Picture this scenario: A plaintiff in a product liability case settles with a minor defendant for nuisance value – say $10,000.00. The plaintiff then goes to trial and hits a home-run and gets a $1,000,000.00 verdict, but the settling defendant is assessed with 10% of the fault. In this situation, the plaintiff would have received a $10,000.00 settlement, but would have his verdict reduced by $100,000.00 (10% of $1Million). The decision to settle early with one defendant would have cost our hypothetical plaintiff $90,000.00. This type of risk may discourage individual settlements in multi-defendant cases.
  • Third, it is unclear whether uncollectible amounts may be reallocated against settling defendants.  A settling defendant remains on the verdict form and fault is assigned to the settling defendant. Under the reallocation provisions, uncollectible amounts may be reallocated against other parties “found to be liable.” Does this include settling defendants? One would expect a settling defendant to get the benefit of their bargain and not be subject to reallocation. Additionally, W.Va. Code §55-7-13d(a)(5) provides that fault assessments against non-parties are to be used for allocations purposes only and do not expose non-parties to liability. It would appear therefore, that uncollectible amounts cannot be reallocated to a party that settles prior to a verdict. However, the statute is not as explicit as it could be in this regard and this principle could be subject to further litigation.

 

Blogger:  John D. “Jack” Hoblitzell

For more information, please contact Jack at 304.345.8900, or send an email to jdhoblitzell@kaycasto.com.