3rd Party Practice

Question 1

How can ∆ assert a claim of contribution OR indemnity?

Answer 1

1) If tortfeasors already co-∆s → they can assert CROSSCLAIMSagainst ea other

2) If some tortfeasors are NOT part of suit → the ∆ can
- (i)IMPLEAD the 3P∆;OR
- (ii) sue in a separate action

NOTE: Impleader is better. If ∆ sues outside tortfeasors in a separate action, the findings of liability (i.e. % of fault) in the 1st action are not binding on 2nd action (problematic) b/c you CANNOT assert collateral estoppel (“issue preclusion”) against a party who has not had her day in court; THUS, you’d have to re-prove all the fact finding

3) ∆ must meetSOL: contribution AND indemnity has a 6-year SOL that runs from the date of payment of the judgment for which contribution/indemnity is sought

Question 2

What is indemnity AND how can it be asserted?

Answer 2

Indemnity: Allows ∆ to shift 100% of the responsibility or damages to another party

Can be accomplished…

1) by contract (e.g. sub-contractor)
2) if implied-in-law
3) Products Liability – manufacturer must indemnify retailer for selling defective product
4) Vicarious liability – e.g., driver indemnifies owner of car

NOTE: Settlement does NOT extinguish claims for indemnity BY or AGAINST a settling tortfeasor

Question 3

What is contribution AND its purpose?

Answer 3

Contribution =the sharing of loss (apportionment) among multiple tortfeasors (who are ACTUALLY part of the tort OR aggravated the damages); allowed in ALL tort cases in NY (contrast MBE)

EXCEPTIONS:
- CPLR Article 16

ON MBE – NOT AVAILABLE when liability is based on an intentional tort

Purpose = mitigate the harshness of joint & several liability (i.e. EA. tortfeasor is liable to π for FULL amount of π’s damages notwithstanding individual tortfeasor’s % fault)

NOTE: ∆ may seek contribution from TP∆ EVEN IF the injured π has NO RIGHT of recover against TP∆

Ex: Manufacturer of smoke alarm, fire protection service. Fire protection service not liable to π because of clause in contract but manufacturer-∆ can STILL implead him for aggravating the damages ➩ So contribution can be broader than liability

Question 4

After a 3P∆ is impleaded, how can π join 3P∆ in action (i.e. make it a ∆)?

Answer 4

After TP∆ is joined, π can amend her complaint to assert complaints directly against TP∆…

- w/in 20 DAYS without judicial permission
- after 20 DAYS with judicial permission

NOTE: π’s claim against 3P∆ generally MUST occur within SOL

EXCEPTION: New claims by π “relate back” to date ∆ filed impleader papersAS LONG AS

(i) based on same T/O as ∆’s impleader claim; AND
(ii) the π's claim against the 3P∆ WOULD HAVE BEEN TIMELY on the date of impleader		

Question 5

How does a ∆implead a 3d party?

Answer 5

1) ∆ files Summons & 3rd Party Complaint
2) within 120 DAYS of filing, ∆ (3Pπ) serves a copy of summons & 3rd party complaint on 3P∆ AND P

** make SURE there is basis for personal jurisdiction & proper service for 3rd parties

3) TP∆ must serve an 3rd party answer on ∆ (3Pπ), π & all other parties

** TP∆’s time limitation for answering is the SAME that would apply to an ordinary ∆ (REVIEW!); either 20 or 30 days DEPENDING on where/how the 3P∆ was served with process

Question 6

What is impleader?

Answer 6

Procedural device used by ∆ to join ANOTHER party alleged to be liable in whole or in part to ∆ for damages that ∆ may have to pay π

Two general forms: (i) indemnity; OR (ii) contribution

** If ∆ joins a 3rd party ∆, then ∆ BECOMES 3rd party π

** NOTE: ∆ may implead 3rd party any time AFTER ∆ serves the Answer

Question 7

What isjoint and several liablity?

Answer 7

Each tortfeasor is liable to π for the WHOLE AMOUNT of damages regardless of the individual tortfeasor’s percentage of fault

NOTE: This is the default rule in NY (except CPLR Art. 16 matters)

Question 8

What isComparative Degrees of Fault contribution?

Answer 8

MAJORITY APPROACH (MBE) and ONLY RULE IN NY

1) Each tortfeasor is ULTIMATELY liable for his actual fault (any excess paid is the amt of contribution)
2) Each ∆ CANNOT be compelled to pay more than his own equitable share to another tortfeasor

NOTE: π can force any ONE tortfeasor to pay the ENTIRE amt of damages if the others are insolvent

Question 9

What is theEqual Shares Formula of Contribution?

Answer 9

Equal Shares Formula (MINORITY VIEW) = All liable tortfeasors pay an equal share of the damages

NOTE: this is ONLY on MBE – will say “in an equal share jurisdiction” (otherwise assume comparative degree)

Question 10

How does workers’ compensation limited contribution and indemnity?

Answer 10

With Workers’ Compensation → π may not sue employer if you are injured on the job. Injured π MAY (nevertheless) sue other 3d party tortfeasor (such as manufacturer of machine used, etc.) for ANY injury

** On MBE: 3P∆ may NEVER implead emloyer for contribution/indemnity

• • In NY: 3P∆ may not implead the employer for contribution/indemnityUNLESS it was a “grave injury” (strictly construed), which is…
    
    • Death
    • Total loss of arm, leg, hand, foot, ear, nose, OR index finger (NOT a thumb)
    • Total loss of multiple fingers OR toes (NOT loss of finger tips)
    • Paraplegia, quadraplegia
    • Total blindness or deafness (NOT blindness in one eye)
    • Severe facial disfigurement
    • Brain damage causing total disability

Question 11

What is the rule for contribution in cases involving sucessive tortfeasors?

Answer 11

Rule: tortfeasor is liable to π for all injuries that proximately flow from the accident BUThe may claim contribution from a successive tortfeasor who aggrevates the injury

E.g. subsequent malpractice by a doctor who negligently treats π can be sued by accident-causing ∆

REMEMBER: assuming a doctor was impleaded within 2.5 year SOL, the relevant SOL for contribution is 6 YEARS FROM PAYMENT

Question 12

What is the rule re: π settlement with ONE tortfeasor and contribution?

Answer 12

1) Rule: π’s pretrial settlement with 1 tortfeasor in partial satisfaction of the claim does NOT discharge π’s claim against other tortfeasors
2) Law prohibits excessive recovery so π can only collect up to total amount of damages

THE REDUCTION FORMULA:Any judgment for π against a non-settling tortfeasor MUST be reduced by the LARGER of:

- the amount of settlement; OR
- the settling tortfeasor’s equitable share of fault

3) A party who settles CANNOT sue or BE sued for contribution (this is NOT the case with indemnity)

Policy: encouraging settlement because the settling party is assured that he cannot thereafter be sued for contribution; BUT the settling party ALSO forfeits his own contribution rights

Question 13

How does CPLR Art. 16 modify joint and several liability in NY?

Answer 13

1) Rule: in a personal injury claim a joint tortfeasor whose fault is found to be 50% or lessCANNOT be required to pay the π more than his equitable share of the π’s noneconomic damages

Noneconomic damages= pain & suffering, mental anguish, loss of consortium, loss of companionship (but NOT wrongful death or property damage)

2) BUT for economic damages, ALLtortfeasors are J&S liable for full judgment

Question 14

What are the exclusions fromCPLR Art. 16?

Answer 14

Exceptions from Art. 16 (i.e. these tortfeasors ALWAYS liable for J&S liability):

1) Tortfeasors who acted with intentional tortfeasors or with reckless disregard

** If multiple tortfeasors - only intentional ones are J&S liable (i.e. the merely negl. tortfeasors ARE eligible for Art. 16)

2) Tortfeasors who release hazardous substance into the environment.
3) Drivers & owners of CARSEXCEPT police or fire cars

** NOTE: police officers/firemen, passangers and auto manufacturers ALL get benefit of Art. 16