Court of Appeals Eliminates Cross-Claims for Contribution and Set-Offs for Settlements

Lisa Krebs was riding as a front seat passenger in a Chevy Trailblazer when her vehicle was struck by a car being driven by Carmen McReynolds. The impact caused the Trailblazer to roll over and land in a ditch, seriously injuring Ms. Krebs. Ms. Krebs sued McReynolds and General Motors, alleging that the vehicle’s lack of crash-worthiness contributed to her injuries. McReynolds answered and filed a cross-claim against GM for, among other things, set-off and contribution.

Before trial, GM settled with Krebs and agreed that the terms would be confidential. McReynolds filed motions attempting to have GM divulge the terms of the settlement arguing that in the event she was found liable for Krebs’ injuries, she would be entitled to either contribution from GM or set-off in the amount of GM’s settlement. This was clearly the law prior to 2005.

GM moved to dismiss McReynolds’ cross-claim on the basis that O.C.G.A. § 51-12-33 had abolished joint and several liability in Georgia and that, therefore, McReynolds had no right to a cross-claim for contribution. GM also argued that McReynolds had no right to a set-off because, pursuant to § 51-12-33, each party was only responsible to the plaintiff to the extent of its own percentage of fault.

At trial, McReynolds presented no evidence of GM’s potential liability other than the allegations in Krebs’ complaint and the jury awarded $1,246,000.42 against McReynolds. The trial court agreed that McReynolds’ cross-claim should be dismissed and that McReynolds was not entitled to a set-off for any amount paid by GM.

The Court of Appeals agreed and wrote that § 51-12-33 did away with claims of contribution. The Court of Appeals also found no basis for a set-off given that the statute requires each liable party to pay its own percentage share of fault and McReynolds presented no evidence regarding GM’s alleged fault.

There are several practical lessons to be learned from this Opinion. First, cross-claims for common law contribution are no longer appropriate in the post joint and several liability world. More importantly, however, is that a defendant seeking to apportion fault against either another defendant or a non-party must prove fault. McReynolds, in seeking to have a jury apportion damages against GM, was required to prove that GM was at fault just as the plaintiff would have been required to prove that GM was at fault. This most likely would have required McReynolds to present expert testimony as to the lack of crash-worthiness of the vehicle.

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About the Author

Michael Rust graduated from Emory University in 1980 and Emory University School of Law in 1983 where he was Notes and Comments editor of the Emory Law Journal (Law Review). Since that time, he has maintained an active trial practice in the state of Georgia both in State and Federal Courts. Mr. Rust teaches litigation as part of Emory University School of Law’s annual Trial Practice Program. He has received AV rating from Martindale Hubble, the highest rating afforded to lawyers by their peers.