FIDELHOLTZ ET AL., APPELLANTS, v. PELLER ET AL.; ONG ET AL., APPELLEES.
No. 96-1777
Supreme Court of Ohio
Decided March 11, 1998.
81 Ohio St.3d 197 | 1998-Ohio-462
Submitted October 22, 1997 at the Muskingum County Session. APPEAL from the Court of Appeals for Stark County, No. 1995CA00340.
[Cite as Fidelholtz v. Peller, 1998-Ohio-462.]
Torts—Person “liable in tort,” when—Joint tortfeasors—Enforcement of right of contribution—Former
Former
{¶ 1} Plaintiff-appellant, Bernice Fidelholtz, in her mid-sixties, had pain and discomfort in her right leg which prompted her to visit her family doctor in 1991. The family doctor referred her to a surgeon, who conducted a biopsy of a growth on her leg. The surgeon sent the tissue sample to defendant-appellee, Dr. Marino G. Ong, a pathologist, for diagnosis.
{¶ 2} The sample was divided into four “blocks.” By cutting tissue from these blocks, twenty slides were generated. Upon examining the slides, Dr. Ong noticed several abnormal features, in particular, an abnormal mitotic figure on slide
{¶ 3} Dr. Bruce A. Sebek, a pathologist, examined the slides at CC. Based on these slides, Dr. Sebek concluded that the growth in Mrs. Fidelholtz‘s leg was benign. At trial, Dr. Sebek testified that had he seen the original slide number four, instead of a recut, he would have diagnosed malignancy. He testified that the recut did not show the abnormal mitotic figure that caused concern to Dr. Ong.
{¶ 4} Dr. Sebek forwarded his diagnosis to Dr. Ong. Dr. Ong adopted this diagnosis and notified Mrs. Fidelholtz‘s surgeon of the findings, which he passed on to her.
{¶ 5} Two years passed. Mrs. Fidelholtz‘s pain continued. In March 1993, Mrs. Fidelholtz underwent outpatient surgery at Timken Mercy Medical Center. The growth in her leg was diagnosed as malignant. As a result of the untimely diagnosis, Mrs. Fidelholtz‘s leg was amputated below the knee. If the cancer had been diagnosed in 1991, an amputation would have been unnecessary.
{¶ 6} Mrs. Fidelholtz and her husband Irving, appellants, filed suit against Dr. Ong; his employer, Aultman Pathology Associates, Inc.; and Dr. Sebek and Cleveland Clinic Foundation (“CCF“),1 alleging negligent misdiagnosis of cancer. Approximately one month prior to trial, Dr. Sebek and CCF settled for $125,000. The case proceeded to trial against Dr. Ong and his employer, appellees.
{¶ 8} The jury returned a verdict in favor of appellants and awarded damages in the amount of $250,001. (The $1 was for Mr. Fidelholtz‘s loss of consortium claim.)
{¶ 9} Appellees filed a motion for judgment notwithstanding the verdict, claiming that pursuant to former
{¶ 10} The court of appeals affirmed. In a separate concurrence, Judge Hoffman urged us to reconsider the Ziegler decision.
{¶ 11} The cause is now before this court pursuant to the allowance of a discretionary appeal.
Allen Schulman & Associates Co., L.P.A., and Allen Schulman, Jr., for appellants.
Roetzel & Andress, Thomas A. Treadon and Sue Ellen Salsbury, for appellees.
FRANCIS E. SWEENEY, SR., J.
{¶ 12} We are asked to decide whether former
“When a release or a covenant not to sue or not to enforce judgment is given in good faith to one of two or more persons liable in tort for the same injury or loss to person * * *, the following apply:
“(1) The release or covenant does not discharge any of the other tortfeasors from liability for the injury * * * unless its terms otherwise provide, but it reduces the claim against the other tortfeasors to the extent of any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, whichever is the greater;
“(2) The release or covenant discharges the tortfeasor to whom it is given from all liability for contribution to any other tortfeasor.” (Emphasis added.) 142 Ohio Laws, Part I, 1673.
{¶ 14} This court had the opportunity to construe former
{¶ 15} The facts in Ziegler reveal that on the first day of trial, two of the defendants, Wendel Poultry and its employee, Terry Hummel (collectively, “Wendel“), informed the court that they had entered into a “high-low” settlement agreement with the plaintiff, agreeing to pay the plaintiff $325,000 regardless of the jury verdict and up to $425,000 if the jury found it (Wendel) liable. The fact of the settlement was not revealed to the jury, and Wendel remained in the lawsuit. The positions of Wendel and the other defendant were adversarial, and Wendel presented its case with vigor. The jury found the co-defendant liable and Wendel not liable. In accordance with the settlement agreement, Wendel paid the plaintiff $325,000. The trial court refused to set off this amount from the total jury award pursuant to former
{¶ 16} On appeal to this court, the plaintiff argued that the trial court correctly refused to reduce the award because Wendel was found not to be liable and, thus, was not a joint tortfeasor. This court rejected that argument, finding that the setoff provision of former
{¶ 18} Appellants argue against such an absolute rule, which provides for an automatic setoff to a nonsettling co-defendant when a co-defendant settles. Appellants assert that this rule is unfair in cases where the defendant receiving the benefit of the settlement is the only party responsible for the injury. Instead, appellants urge this court to overrule Ziegler and adopt a rule of law giving the trial court discretion to determine whether the settling defendant was a person “liable in tort,” which would then trigger the right of setoff.
{¶ 19} We agree that Ziegler‘s absolute rule is too harsh under certain facts, such as those presented here. A settlement is not tantamount to an admission of liability. Chitlik v. Allstate Ins. Co. (1973), 34 Ohio App.2d 193, 198, 63 O.O.2d 364, 367, 299 N.E.2d 295, 299. Defendants settle for many reasons, such as the avoidance of bad publicity and litigation costs, the possibility of an adverse verdict, and the maintenance of favorable commercial relationships.
{¶ 20} Recognizing that an automatic setoff may prove unduly harsh in some cases, a minority of courts have held that there must be some showing, either by judicial determination, the release itself, or stipulations of the parties, that the settling defendant‘s actions contributed to the harm. Rocco v. Johns-Manville Corp. (C.A.3, 1985), 754 F.2d 110, 114-116. See, also, Med. Ctr. of Delaware, Inc. v. Mullins (Del.1994), 637 A.2d 6, 8-9; Collier v. Eagle-Picher Industries, Inc. (1991), 86 Md.App. 38, 56-60, 585 A.2d 256, 265-267. The rationale underpinning these holdings is that where only one of several defendants was responsible for the injury, that defendant would have been obligated to pay the entire damage amount if the settling party had not settled. Thus, the former should not reap the benefit of a settlement by the latter. Mullins, 637 A.2d at 9.
{¶ 21} We believe that these cases offer the more reasoned view. Moreover, they are in accord with our recent case of MetroHealth Med. Ctr. v. Hoffmann-LaRoche, Inc. (1997), 80 Ohio St.3d 212, 685 N.E.2d 529, the language of the statute, and the goals it seeks to accomplish.
{¶ 22} In MetroHealth, a thirty-nine-year-old woman died, allegedly because of a drug administered during a gastroscopy. Her estate sued MetroHealth
{¶ 23} We were asked to decide whether a right to contribution exists where the underlying claim against the responsible co-defendant was dismissed because of the statute of limitations. We answered in the affirmative. We noted that at common law, contribution, i.e., the right of one who has discharged a common liability to recover from another the portion that the other should have paid, was not allowed between concurrent or joint tortfeasors. Id., 80 Ohio St.3d at 214, 685 N.E.2d at 531. We found that the General Assembly enacted
{¶ 24} In construing “liable in tort” in the context of former
{¶ 25} A principle of statutory construction states that where statutory words and phrases have acquired a particular meaning, whether by legislative definition or otherwise, the words must be construed accordingly.
{¶ 26} We agree with appellees that two policy objectives for these statutes were to encourage settlement and to prevent double recovery. However, we believe that the broader and more important goal was to ensure that where multiple tortfeasors were at fault in bringing about the injury to the innocent party, each tortfeasor would share the burden of making the injured party whole again. It seems only logical that a party found to have acted alone in causing the harm should not be entitled to a reduction in the damage award.
{¶ 27} Accordingly, we hold that former
{¶ 28} Here, the evidence reveals that Dr. Ong failed to forward the crucial piece of information (slide number four) to Dr. Sebek. Dr. Sebek testified that had he examined this slide, he never would have diagnosed a benign tumor. All witnesses, including Dr. Ong and his expert, were in agreement that Dr. Sebek was not negligent. Thus, appellees were solely responsible for the harm. The trial court could easily have made this determination when it was asked to rule upon the motion for judgment notwithstanding the verdict.
{¶ 29} We hold that payments made to appellants by defendants who were not determined to be persons “liable in tort” do not entitle appellees to a setoff. Accordingly, we reverse the judgment of the court of appeals and reinstate the original jury verdict of $250,001 against appellees.
Judgment reversed and verdict reinstated.
MOYER, C.J., RESNICK and PFEIFER, JJ., concur.
DOUGLAS, J., dissents.
COOK and LUNDBERG STRATTON, JJ., separately dissent.
FIDELHOLTZ ET AL., APPELLANTS, v. PELLER ET AL.; ONG ET AL., APPELLEES.
No. 96-1777
Supreme Court of Ohio
Decided March 11, 1998.
COOK, J., dissenting.
{¶ 30} Because a majority of this court misinterprets former
{¶ 32} Black‘s Law Dictionary definitions of “liable” and “liability” demonstrate that the concept is broadly defined to encompass both the ultimate legal responsibility for an act and the potential of being held legally responsible for an act. Black‘s Law Dictionary (6 Ed.1990) 914, 915. Accordingly, we need to determine which definition the legislature intended in its specific use of “liable” from its context and its application in the overall statutory scheme.
{¶ 33} Under either definition, this court‘s decision in MetroHealth Med. Ctr. v. Hoffmann-LaRoche, Inc. (1997), 80 Ohio St.3d 212, 685 N.E.2d 529, was wrong. After the applicable statute of limitations has run against an alleged tortfeasor, even the potential for being held legally responsible is gone. Accordingly, where a statute of limitations prohibits a plaintiff from commencing an action against an alleged tortfeasor, that party‘s liability cannot be “extinguished” by a later release. MetroHealth, 80 Ohio St.3d at 217, 685 N.E.2d at 534 (Cook, J., dissenting).
{¶ 34} Although either of Black‘s definitions supports the dissent in MetroHealth, this case requires us to choose. The majority interprets the phrase “liable in tort” to require a party seeking setoff under former
{¶ 35} The majority attempts to reconcile today‘s opinion with Ziegler by noting that the agreement in Ziegler was executed in contemplation of the settling defendant being found jointly and severally liable. The problem with that distinction is that the settlement agreement in this case, like most if not all settlement releases, also contemplates that the settling defendant might otherwise be held legally responsible for the plaintiff‘s injuries. The only consideration given by the Fidelholtzes in exchange for the settlement proceeds, in fact, was to release and discharge the settling defendant from all liability associated with this action.
{¶ 36} The Ziegler court had a tougher question than this case presents. Due to the parties’ “high-low” agreement, the Ziegler court had to determine whether former
{¶ 37} At the time of its settlement, the potential remained that Cleveland Clinic Foundation (“CCF“) would be held responsible for the Fidelholtzes’ injuries. CCF bought its peace by obtaining a settlement release. With that release, CCF bought not only an assurance that the Fidelholtzes would not later sue it for the same injury, but also that any other tortfeasor who pays a disproportionate share of the Fidelholtzes’ damages could not seek contribution from CCF. Former
{¶ 38} Under the statutory scheme, the Fidelholtzes are entitled only to the amount the jury determined as their total damages. Under former
{¶ 39} The CATA, when correctly interpreted, allows the victim of a tort to receive a measure of compensation designed to make him or her whole, promotes settlement and judicial economy, and provides a scheme by which joint tortfeasors
{¶ 40} The majority‘s gloss on the statutory scheme gives plaintiffs incentive to sue parties whose legal responsibility for the plaintiffs’ injuries is doubtful. As noted by the majority, defendants settle for many reasons other than the likelihood of an adverse verdict, including the avoidance of bad publicity and litigation costs, and the maintenance of favorable commercial relationships. If sums received from these settlements are permitted to augment the amount that a jury determines to be proper compensation for the injury, plaintiffs are encouraged to sue as many entities as possible in hopes that parties who would likely prevail at trial might settle for other reasons.
{¶ 41} Finally, whatever may be said for the reasoning that supports the judicially created collateral source rule, we cannot assume that the General Assembly intended its incorporation by analogy when drafting the CATA. The collateral source rule has at its base an assumption that a defendant wrongdoer should not ” ‘get the benefit of payments that come to the plaintiff from a “collateral source.” ’ ” Pryor v. Webber (1970), 23 Ohio St.2d 104, 108, 52 O.O.2d 395, 397, 263 N.E.2d 235, 238, quoting 2 Harper & James, The Law of Torts (1956), Section 25.22. The majority engrafts this principle onto former
{¶ 42} Ziegler provides the correct rule of law and should control this action. Accordingly, I would affirm the judgment of the court of appeals.
FIDELHOLTZ ET AL., APPELLANTS, v. PELLER ET AL.; ONG ET AL., APPELLEES.
No. 96-1777
Supreme Court of Ohio
Decided March 11, 1998.
LUNDBERG STRATTON, J., dissenting.
{¶ 43} I join in Justice Cook‘s dissent but write separately to voice a stronger concern. A plaintiff, and a lawyer filing on the plaintiff‘s behalf, should sue only when they have a good faith belief that the defendant is or may be liable for damages incurred. While a defendant may settle for many different reasons
{¶ 44} If the plaintiff settles, the plaintiff is conceding by settlement that the plaintiff still considers the defendant liable. That is all that should be needed to invoke
Notes
“A payment by any person made in compensation of a claim for a harm for which others are liable as tortfeasors diminishes the claim against the tortfeasors, at least to the extent of the payment made, whether or not the person making the payment is liable to the injured person and whether or not it is so agreed at the time of payment or the payment is made before or after judgment.”
Comment f to that subsection states in part:
“Payments made by one who is not himself liable as a joint tortfeasor will go to diminish the claim of the injured person against others responsible for the same harm if they are made in compensation of that claim, as distinguished from payments from collateral sources such as insurance, sick benefits, donated medical or nursing services, voluntary continuance of wages by an employer, and the like. These payments are commonly made by one who fears that he may be held liable as a tortfeasor and who turns out not to be.”