HomeMy WebLinkAbout3.5 Joint & Seveal Liability SB 575 fl 0 -53
. ,
CITY OF DUBLIN
AGENDA STATEMENT
MEETING DATE: May 9 , 1983
SUBJECT SB 575 (Foran) Joint & Several Liability
EXHIBITS ATTACHED Memorandum from County Administrator dated 4/22/83 ;
Resolution
U '
RECOMMENDATION • ) Adopt resolution supporting SB 575
2) Forward to State Senate
FINANCIAL STATEMENT: Reduce liability costs
DESCRIPTION Current law presently makes each defendant in a law
suit individually liable for the entire amount of
damages awarded to the plantiff, irrespective of each
defendant ' s degree of fault in causing the injury
sued upon. For example , an individual is injured by
another motorist who happened to be intoxicated. The
injured party sues not only the motorist who was
intoxicated, but also the City for faulty road
design. Under current law, the court could find that
the City was 10% liable and the intoxicated motorist
was 90% liable for damages . However, if the
intoxicated motorist does not have adequate assets to
pay for his share of the costs , the court could
require the City to pay the entire judgement . Thus ,
Cities and taxpayers have been required to bear a
disproportionate share of liability costs in such
injury lawsuits .
SB 575 (Foran) would reform existing law, and provide
that in an action for personal injury, property
damage or death where the indivisible injury was
caused by two or more parties , the damages would be
equitably apportioned among them.
The County of Alameda has requested that the City of
Dublin join it , along with other public entities in
the County to adopt a resolution of support of SB
575.
It is Staff ' s recommendation that the City council
adopt such a resolution.
COPIES TO:
ITEM NO. 3-5
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• D
COUNTY ADMINISTRATOR 1PR 221983
OF DUBLIN
MEL HIND STEPHEN A HAMILL
COUNTY ADMINISTRATOR ASSISTANT COUNTY ADMINISTRATOR
April 21, 1983
TO: City Managers, Alameda County
Superintendent of School Districts, Alameda Co.
Major Special Districts, Alameda Co.
FROM: Mel Ming, County Administra df
SUBJECT: SB 575 (Foran) : Joint and Several Liability
The Alameda County Board of Supervisors on April 12, 1983 passed a resolution
in support of SB 575. The Board also directed my office to contact the
cities, school districts and other public entities in Alameda County,
requesting that you adopt similar resolutions and forward them to the members
of the County' s legislative delegation who represent your city or district.
Attached are two documents. The first is a copy of the action taken by the
Alameda County Board of Supervisors on April 12, 1983. The second is
background information compiled by San Diego County regarding some of their
experiences with joint and several liability.
SB 575 is set for its first hearing in the Senate Judiciary Committee on
Tuesday, May 3, 1983. Both Senators Petris and Lockyer serve on this
Committee. Please review this material and recommend that your Council or
Board take positions similar to that of Alameda County and inform your
legislators accordingly. If you have any questions about any of this
material, please contact the County' s Legislative Coordinator, Judy Shukraft,
at 874-6252.
MH:JS:ng
Atts.
2311
1221 OAK STREET ' SUITE 555 ' OAKLAND. CALIFORNIA 94612 ' 14151 874.6252
�‘ AGENDA Al April 12, 1983
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COUNTY A D M I N I S T R A T O R
•
MEL HIND STEPHEN A HAMILL
COUNTY AONINISTAAT OA
ASSISTANT COUNTY ADNINI OR
April 5, 1983
The Honorable Board of Supervisors
Administration Building
Oakland, CA 94612
Dear Board Members:
Subject: SB 575 (Foran) : Joint and Several Liability
RECOMMENDATIONS:
It is recommended that your Board:
1. Adopt the attached resolution in support of SB 575;
2. Direct the County's Sacramento Legislative Advocate to support SB 575 on
behalf of Alameda County; and
3. Direct my office to forward this information to cities, school districts
and other public entities in Alameda County, requesting that they adopt
similar resolutions and forward them to the County's legislative
delegation.
SUMMARY:
SB 575 would reform current law which makes each defendant in a tort action
individually liable for the entire amount of damages awarded, irrespective of
each defendant's degree of fault in causing the injury sued upon. This bill
would provide that in an action for personal injury, property damage or death
where the indivisible injury was caused by two or more persons, the damages
would be equitably apportioned among them by the trier of fact. Each
defendant would remain jointly and severally liable for economic damages.
(Economic damages are defined to mean verifiable pecuniary losses including,
but not limited to, burial cost, medical expenses, loss of earnings, loss of
use of property, cost of repair or replacement, cost of obtaining substitute
domestic services, loss of employment and loss of business or employment
opportunities.) However, each defendant would be liable for the percentage of
non-economic damages allocated to that defendant, and liability would be
several and not joint. (Non-economic damages are defined to mean subjective,
non-pecuniary losses including, but not limited to, pain, suffering,
inconvenience, mental suffering, emotional distress, loss of society and
companionship, loss of consortium, injury to reputation and humiliation.)
1221 OAK STREET SUITE 555 OAKLAND CALIFORNIA 94612 14151 574.6252
The Hon. Board of Supervisors -2- April 5, 1983
DISCUSSION/FINDINGS:
The Chairman of your Board has been contacted by San Uiego County, requesting
that your Board review this legislation and take the actions outlined in
recommendations above.
Alameda County, as other public jurisdictions, is incurring increased cost due
to claims for injuries primarily involving road design. Some of these suits
are brought by the passenger in a car driven by an intoxicated person. Under
current law, even if it is found that the road design is only 10% of the cause
of the accident, the County ends up paying 100% of the claim or settling out
of court for a very high sum because of fear that a court settlement would be
even more costly. Over the past 7 years, Alameda County has paid or reserved
for settlement $4.8 million for road design cases, many of which fall into the
category of joint and several liability. Every indication is that if the law
is not changed, litigation costs in this area will continue to rise.
Very truly yours,
MEL RING 1\47
County Administrator
MH:JS:ng
Att.
cc: Charles H. Cruttenden
County Counsel
Director, Public Works Agency
Judy Adams
2085
I. Joint and Several Liability
A. The Legal Framework
In order to appreciate fully the impact of the tort doctrine of joint and
several liability on public agencies in California, it is necessary to
briefly summarize a trio of court cases decided during the 1970's.
1. Li v. Yellow Cab (1975) 13 Cal. 3d 804. Prior to the Li case, '
California courts employed the doctrine of "contributory negligence"
in tort cases. Under that doctrine, a person was barred from recovery
in a tort action if his own negligence contributed in any way to his
injury. The Li case replaced that doctrine with the doctrine of
"comparative negligence." Under this doctrine, the negligence of all
parties to an injury or accident is ascertained, and liability is fixed
accordingly based on the proportionate fault of the parties. Under
the comparative negligence doctrine, a person whose own negligence
contributed to his injury is not barred from recovery in a tort
action. In fact, for example, a drunk driver who was 90% at fault
for injuries he received in a traffic accident may still recover 10%
of his damages from other negligent parties.
2. American Motorcycle Assn. v. Superior Court of Los Angeles (1978)
20 Cal. 3d 578. The American Motorcycle case is important in two
respects:
(a) Prior to American Motorcycle the courts followed the doctrine of
"equitable indemnity" which provided that negligent defendants
could divide up the damages assessed on a pro rata basis. With
American Motorcycle, the court switched to the doctrine of
"partial indemnity," whereby defendants could be indemnified
in proportion to their respective fault. Under both the former
and the latter doctrine, the defendant initially paying an award
3.
the passenger is not so barred.
(2) While under earlier design immunity standards, the County would
not have been liable for a design defect in the roadway, under
current design immunity standards (Baldwin) the County would be
liable as a defendant if it had actual or constructive notice of
a defect in the roadway's design.
(3) If the passenger were awarded a multi-million dollar damages award
for injuries suffered in the accident, he could seek to collect
such damages from either the County or the intoxicated driver in
the full amount of the award.
(4) If the injured party collected his entire award from the County,
it would be up to the County to seek indemnification from the
party 90% at fault--i.e. , the intoxicated driver/friend of the
injured party.
(5) If that driver were "judgement proof"--i.e. , uninsured or.unable to
pays-the County,whfchis only 10 percent at fault, would end
up paying the entire multi-million dollar award.
C. Policy Considerations
Existing doctrines of tort liability in California are predicated upon the
fundamental notion that an injured party should be compensated for his
damages. This notion, in the abstract, makes a lot of sense for a number
of reasons: Without compensation, the injured party may become a ward of
the State; the injured party should not be made to bear the expense for
injuries caused by others; the injured party should be compensated for all
his pain and suffering, loss of wages, psychological trauma, etc. However,
when such humanitarian policies disproportionately impact one category of
defendant, and when that category is comprised of public agencies, other
policy considerations come into play.
•
5.
Diego, as is the case with other public agencies, is increasingly being
made defendant in personal injury lawsuits because the doctrine of joint
and several liability makes the County a very attractive defendant. And
this may occur even if the County has no liability for an injury: If
there is any risk that an injured party can successfully argue that the
County is even 1 percent at fault for the person'.s injuries, -the County
is faced with the possibility of paying 100 percent of the person's damages.
This forces the County to consider the advisability of settling such suits
for substantial sums to avoid exposure to even greater risks. Some examples
of recent litigation involving the County will illustrate the magnitude
of the problem:
Case I: Elderly couple walking at night on sidewalk of a straight stretch
of road. Husband decides to cross the street at mid-block. He is
wearing dark clothing. His wife tries to talk him out of crossing
and tells him to cross with her at traffic signal at end of block.
He does not listen and crosses street. He is fatally injured by
•
a vehicle that did not see him.
Claim: Wife is suing County for poor road design, no street
lighting, etc.
Amount: $300,000
Case II: Person was driving a full-size car, "under the influence" and
driving erratically on a County road. Driver crosses median and
runs head-on into smaller car. Driver of small car is fatally
injured. Passenger next to driver is seriously injured. County
is being sued by drunk driver, parents of fatally injured driver,
and passenger who was seriously injured in the small car.
Claim: Parents of fatally injured driver suing County for $505,000.
Drunk driver suing the County for $234,000 plus future medical
losses and future loss of earnings. Passenger suing the County for
5175_nnn
8.
negligent in not arresting him for drunken driving shortly before
his accident when he was stopped fora speeding ticket.
II. Practical Consequences for Public Works ''Management
A. Scope of the Problem
County of San Diego presently maintains 2,100 miles of roads and
streets within an area of over 4,300 square miles. Over 200 miles
of these roads are unpaved, and several hundred miles were either
designed or constructed to a standard which could be more than 50
years old. In addition, numerous miles of County road were never
designed to any standard at all , but simply evolved from the pre-
existing trails used by the early settlers.
There are approximately 4,300 accidents which occur on the County road
system annually, and which are investigated by the California Highway
Patrol . Any one of these accidents could result in a lawsuit against
the County.
B. Practical Problems in Eliminating Liability Exposure
The major theories of liability under which the County is made a defendant
in accident-related lawsuits have to do with allegedly faulty road
design, improper delineation between traffic lanes, inadequate and
improperly maintained warning signs, and improper road maintenance.
Obviously, a major practical problem in eliminating the County's exposure
with respect to these items has to do with cost. In addition to main
tenance requirements for 2,100 miles of County roads, the County is
responsible for maintaining some 20,000 traffic signs. This number has
grown from approximately 10,000 signs in 1970. Existing maintenance
requirements reflect rapid growth and development during the 1960's and
70's. Unfortunately, the County's ability to finance the cost of
maintenance has been substantially reduced as a result of tax limitation
measures approved by the voters.
9.
The problem is almost cyclical in nature: Inadequate resources con-
tribute to liability exposure, which often results in substantial
judgments against the County because of existing tort liability
doctrines, which further reduces the availability of resources to
provide proper maintenance, which further expands liability exposure,
etc.
C. Local Efforts to Reduce Exposure
The County of San Diego has been self-insured for the last several
years. Prior to that, the County maintained deductible policies of
liability insurance. The decision to become self-insured was based
upon increased premium costs to the County for maintaining private liability
insurance. The County's Claims Manager has indicated that premium
costs for private insurance today would be prohibitive.
The primary thrust of the County has been to attempt to reduce liability
exposure on the County road system. A program to accomplish this
objective has been implemented by the Department of Public Works.
Typical examples of ongoing activities undertaken recently to reduce
the County's liability exposure are as follows:
1 . All traffic collision reports are reviewed and placed into a com-
puterized accident record system. Accidents involving fatalities,
serious personal injuries, or some alleged problems with the road
are sent to the . Claims Manager for investigation prior to
receiving any claim. Alleged problems with the roads are brought to
the attention of the Division Superintendent for review and action.
2. A monthly report listing all road intersections and road segments
with three or more accidents per year is prepared. This list
averages 170 intersections and 380 road segments. Intersections on
this list are reviewed at least once annually, or more often if
11 .
This was essential to carry out effectively DPW's maintenance
responsibility, because the number of signs maintained has grown
from approximately 10,000 in 1970 to more than 20,000 in 1981 .
7. 2,000 miles of paved road with pavement markings are maintained.
Pavement marking includes paint striping, Raised Pavement Markers,
curb painting, legends and crosswalks.
8. The Department of Public Works receives approximately 11 claims per
month involving traffic collision. In responding to a claim, a
review of department records, a field review and interview of respon-
sible individuals is conducted.
9. Reflective and non-reflective Raised Pavement Markers (RPM's)
are being installed at various intersections throughout the County
in lieu of striping. RPM's will enhance traffic lane delineation,
which will improve traffic safety.
10. The Traffic Operations Group of the Department of Public Works has
developed a "liability consciousness" approach toward the department's
traffic operational activities. This has been undertaken in an
attempt to constantly review our work and operational directives
as they may relate to future legal actions. When it becomes
second-nature to review work activities with potential litigation
in mind, it hopefully will become easier to anticipate and protect
against unwarranted claims. It also may provide supportive evidence
to back up the fact that County staff are "reasonable" individuals
doing the best they can with what they have.
III. Legislative Reform
A. The Need for Reform
Public agencies are preferred targets for recovery-minded plaintiffs.
Public agencies are viewed as "deep pocket" reservoirs of immense wealth.
The only problem for an injured plaintiff is how to make the public
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13.
Senator Beverly introduced and carried SB 500, a bill which would have
significantly modified the law of joint and several liability. Senate
Bill 500 provided that when more than one defendant is at fault in a
tort action, the principle of "joint liability" would not apply to a
co-defendant for non-economic damages (e.g. , personal injury) 'unless
that co-defendant was at least 40 percent at fault for the injury.
The co-defendant's-liability, when his fault is less than 40 percent,
would be limited to his proportionate share of fault. Senate Bill 500
passed the Senate, only to fail passage by one vote in the Assembly
Judiciary Committee.
On February 24, 1983, Senator Foran introduced SB 575 which would provide that
in an action for personal injury, personal damage or death, where the
indivisible injury was caused by two or more persons, the damages would be
equally apportioned among them by the trier of fact. Each defendant remains
jointly and severally liable for economic damages. However, each defendant
would be liable for the percentage of non-ecomonic damages allocated to that
defendant, and liability would be several and not joint. SB 575 will have its
first hearing in the Senate Judiciary Committee on May 3, 1983.
RESOLUTION RE
• JOINT AND SEVERAL LIABILITY
•
WHEREAS, the present legal doctrine of joint and several liability makes
co-defendants in a single cause of action individually liable for the entire
amount of damages awarded; and
WHEREAS, a plaintiff in a civil action may collect his award for damages
from a single co-defendant if he so chooses; and
WHEREAS, in such case the paying co-defendant must seek reimbursement from
the remaining co-defendants; and
WHEREAS, if the remaining co-defendants are insolvent or judgment-proof,
the paying co-defendant may be left with the entire cost of the award for
damages; and •
WHEREAS, exposure to such financial liability bears no direct relation to
the proportion of legal fault of the respective co-defendants; and
WHEREAS, public agency co-defendants, because of their "deep pocket"
ability to pay, are often made to pay large damage awards in civil actions in
which they are minimally at fault; and
WHEREAS, the burden placed upon the taxpayer as a result of the current
doctrine of joint and several liability is inequitable and improperly makes
public agencies insurers for the negligence of others;
NOW, THEREFORE, BE IT RESOLVED, the doctrine of joint and several
liability should be reformed to make financial liability reflect more closely
legal liability; and
BE IT FURTHER RESOLVED, Senate Bill 575, introduced by Senator Foran on
February 24, 1983, represents an equitable proposal to reform the current
doctrine of joint and several liability; and
BE IT THEREFORE RESOLVED, the Legislature is urged most strongly to secure
the enactment of the provisions of such Senate Bill 575.
###
. .
THE FOREGOING RESOLUTION was passed and adopted by the following vote
of the Board of Supervisors, County of Alameda, State of California
on April 12, 1983 , to wit:
APPROVED AS RECOMMENDED:
•
AYES: Supervisors Bort, Excell, Santana and Chairman George - 4
NOES: Supervisors None •
EXCUSED: Supervisor trooper - 1
dr/2
CHAIRMAN, BOARD OF SUPERVISORS
I hereby certify under penalty of perjury that a copy of the attached document
has been delivered to the Chairman, Alameda County Board of Supervisors, as
provided in Section 25103 of the Government Code.
Dated: April 12, 1983
WILLIAM MEHRWEIN, Clerk, Board of
Supervisors, County of Alameda
By: _ 4i0.w I CERTIFY THAT THE FOREGOING IS
ORECT COPY OF A RESOLUTION ADOPTED By
THE BOARD OF SUPERVISOR ALAMEDA
FILE # 0061 Q 1983
COUNTY,DAtbf NAGENDA # 11 ATTEST: /n1�i"[►��
WILLIAM MEHRWEIN, CLERK OF
RESO# R-83-24 THE BOARD,Of SORS
BY
RESOLUTION
0305E