Pennsylvania Governor Signs “Fair Share Act” into law
/ 12.Jul, 2011
On June 28, 2011, Pennsylvania Governor Tom Corbett signed into law Senate Bill 1131, also known as the “Fair Share Act”, which amends the Comparative Negligence Statute. The law will largely eliminate “joint-and-several” liability for all actions brought to recover damages for negligence in Pennsylvania. Under the Fair Share Act, a civil defendant found to be less than 60 percent liable will be responsible for paying only their fair share of any damages verdict.
Under the prior “joint-and-several” law, a plaintiff could recover 100 percent of the damages awarded regardless of that defendant’s apportioned liability. If co-defendants were judgment-proof or could not pay, a defendant whose liability was as little as one-percent could be required to pay the entire amount of the verdict. The “paying defendant” would be required to seek to recover from the non-paying defendants, but this effort would result in additional court costs and fees, and might not be successful. Under the new law, a defendant who is less than sixty percent liable will only be required to pay its apportioned percentage of the verdict. The statute states that each defendant’s liability shall be several and not joint, and the Court shall enter a separate and several judgment against each defendant for the apportioned amount of that defendant’s liability, except for certain types of actions.
The statute clearly delineates certain exceptions from the law. One exception in the law makes a defendant who is more than sixty percent at fault potentially liable for the full amount of any judgment. Other exceptions include: intentional acts, misrepresentation, hazardous waste sites, and liquor law violations.
While we anticipate that defendants pursued under both negligence and strict liability will attempt to utilize the Act to reduce their proportionate liability, it remains to be seen as to what extent the courts will permit the application of this new law to limit liability for defendants held strictly liable. The Fair Share Act amends Pennsylvania’s negligence statute, but then states that it will include actions where there are claims against defendants based on negligence and defendants based on strict liability. The Act does not specifically state that strict liability defendants shall be assessed percentage liability, however, merely that each defendant shall only be responsible for its own apportioned share. An apportioned share could be either a percentage of the total liability or a pro-rata share of the liability not apportioned to defendants found to be negligent.
Well-established case law clearly states that strictly liable defendants shall be liable for pro rata, not percentage shares. We anticipate that plaintiffs will argue that the language of the Fair Share Act does not conflict with that established precedent. Assessing percentage liability to defendants found strictly liable would inject fault/negligence concepts into strict liability cases, however, which the Pennsylvania Supreme Court held to be improper in Walton v. Avco, 530 Pa. 568, 610 A.2d 454 (Pa. 1992). This would further complicate Pennsylvania’s already-complex liability scheme. We expect there will also be litigation as to the proper interpretation of what constitutes a case “…brought to recover damages for negligence…”. Would this Act apply to cases which initially include allegations of negligence or only to cases where a negligence claim is pursued to verdict or settlement? The courts will eventually address these issues.
However these terms are eventually defined by the Pennsylvania courts, so long as a case is “brought to recover damages for negligence”, and a asbestos defendant’s share is less than 60% (however apportioned), that defendant can only be required to pay its own apportioned share, not the entire verdict.
Another important aspect of the new law allows the judge or jury to apportion liability to nonparties with whom plaintiff has entered into a Release. This could allow defendants to introduce evidence against some bankruptcy trusts and other entities not sued for jury consideration, to possibly reduce the damages they are required to pay.
The Fair Share Act is effective immediately, but will only apply to cases that accrue on or after the effective date of the law, which is June 28, 2011. This means the change will most likely have no effect upon current suits, but will be applied in new filings.
For more information regarding the Pennsylvania Fair Share Act, please contact Norman Haase
at firstname.lastname@example.org, Miriam Dole
at email@example.com or Edmund John
at firstname.lastname@example.org .