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Real Estate Term:Joint and several liability
Joint and several liability is a common law rule of liability, whereby a plaintiff may recover the entirety of the damages from any of negligent defendants independent of their individual share of the liability. The rule is often applied in tort cases, though it is sometimes invoked regarding insurance, business and agency law. Forty-six of the fifty United States had a rule of joint and several liability at one point, but the majority have, in response to tort reform efforts, limited or abolished the rule.
Joint and several liability is premised on the idea that the defendants are in the best position to apportion damages amongst themselves. Therefore, once liability has been established and damages awarded, the defendants are free to litigate amongst themselves to better divide liability. Joint and several liability permits the plaintiff the exit litigation at the earliest possible point—thereby avoiding the cost of continuing litigation.
Another premise of joint and several liability is that corporations, individuals and insurers who have caused an injury by violating the law should not be able to avoid compensating the injured victim simply because they were not the only party that substantially contributed to the victim's injuries or losses. The object of this legal principle is to avoid unfairly shifting to victims losses that were brought about by multiple wrongdoers.
Where a financially wealthy defendant can be joined as a defendant, a plaintiff's expected damages increases. For example, if Mary is struck by a car driven by John, who was served in Joe's bar (and the state has Dram Shop laws), then both Joe and John may be held jointly liable. Under joint and several liability, If Mary is awarded 10 million dollars by a jury, she may recover the full damages from either of the defendants. In this example, Joe may have quite a bit more money as a business owner, and in many cases will carry insurance (though the price of the insurance will reflect the risk of joint and several liability). Even if Joe is not as much as at fault as John, joint and several liability could require Joe to pay the full amount.
Opponents of tort reform contend that the elimination of the common law rule of joint and several liability would arbitrarily act to undercompensate people who had the misfortune to be hurt by more than one person, if one of the defendants found liable does not have the financial wherewithal to pay his or her share of proportionate liability. They favor the principle of joint and several liability based on the premise that, when two defendants together cause an injury to a third person, and one of the defendants cannot pay damages, it is fairer for the remaining defendant to have to pay the whole amount, rather than allowing an innocent victim to suffer the further injury of not receiving the full compensation owed. Supporters of the change note that the use of joint and several liability instead of proportionate responsibility can lead to absurdly unfair results. The classic example is the uninsured drunk driver who injures someone; the plaintiff will sue both the insolvent drunk driver and the state highway department, hoping to hold the latter 1% or 2% responsible. E.g., Walt Disney World Co. v. Wood, 489 So. 2d 61 (Fla. Dist. Ct. App. 1986). This sometimes forces the "deep pocket" to settle rather than risk trial. According to Richard Wehe, Assistant Chief Counsel at the California Department of Transportation, (Caltrans), "I can tell you that in many, many settlement conferences or mediations I am confronted with plaintiff's lawyer's statements that, 'I only need to establish that the state is 1 percent at fault and I can recover all of my economic damages.'"[1] Joint and several liability, reform supporters argue, leads to litigants search for "deep pockets" to sue, even though those defendants may only be remotely related to an incident.
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