Velez v. Tuma

Tima v l Velez v TUMA VELEZ (Calendar 5). Argued Decided 2011 No. 138952. December Docket No. July 23, 2012. Wayne brought malpractice in the Myriam a medical action Velez Keceiving Hospital, Harper Hospital, against Court Detroit Circuit M.D., Schwartz, M.D., Turna, alleging that and Martin Lawrence amputa- leg timely operate its failure to on her necessitated their sue, the filed a intent to below the knee. After she notice of tion agreement in which hospitals with Velez entered into settlement pay $195,000, they agreed and Velez’s was dismissed to her lawsuit Turna, party by stipulation prejudice not a but to who was without complaint agreement. filed a to the settlement Velez new jury, Turna, negligent by professionally and he was to be found $1,524,831 jury The Velez’s favor. which returned verdict verdict, past separating economic it into and future itemized apply damages. requested Turna that the court and noneconomic noneconomic-damages cap verdict of MCL 600.1483 to the $195,000 judg- settlement the final and then subtract from court, Stephens, J., request, Cynthia The Diane denied the ment. Inc, Markley ofColdwater, citing Investors Oak Health Care (2003), App Mich held that the common-law setoff which malpractice applied actions in to medical which imposed. The court instead subtracted the settlement verdict, unadjusted applied the rule of from the collateral-source 600.6303, requires to award which the court reduce a already paid of economic the amount to insurers, applied the collateral sources such as and then Cavanagh, EJ., noneconomic-damages cap. Appeals, The Court of JJ., decision and Fort Hood and affirmed circuit court’s Davis, unadjusted verdict, reasoning apply that the the setoff to the applicable to medical common-law setoff rule was involving severally jointly liable cases tortfeasors necessary prevent plaintiffs application setoff rule was addition, Appeals being overcompensated. In the Court of why principles that was no reason the same reasoned there 600.2925d(b) applied right under to the to setoff former MCL right apply also to setoff. should not to the (2009). Supreme appeal App leave to in the Turna for i Mich Court, application cross-appeal, filed an for leave to initially both which were denied. 488 Mich 903 Supreme subsequently granted Court Tuma’s motion recon- granted appeal question him sideration and leave to limited to properly against jury the set the whether setoff was off noneconomic-damages application verdict before and judgment. Following calculation of the final 489 Mich 956 argument, Supreme sponte oral the Court Velez’s sua reconsidered cross-application granted cross-appeal and her to to leave consider Markley correctly whether had been decided. 491 873. Mich by opinion joined by In an Justice Chief Mary Beth Kelly, (except Young Justice and Justices Markman for one statement III) part Supreme and the Court held: Zahra, Legislature principles To the extent that the has not abolished joint liability, principles of and several those and the common-law Michigan. joint setoff rule remain the law in and When several liability apply case, principles malpractice any in a medical settle- judgment application ment must be set from the final off after of noneconomic-damages cap the and the collateral-source rule. changed, amended, 1. The common law until remains effect repealed. question legislative or It is a intent whether the Legislature abrogated, amended, preempted has or the common Legislature law. The did not intend abolish the common-law joint liability rule in setoff the context of and several malpractice statutory setoff, cases because its elimination of the 600.2925d(b),by former MCL PA 161 did not demonstrate a abrogate intent clear the common-law rule. Deletion of the statutory only part comprehensive setoff a was tort-reform legislation, and there is no conflict between the common-law rule prevent and the current versions the statutes that would the being applied joint common-law setoff from in these and several liability situations. 600.6304(6)(a), 2. Under MCL a medical defendants in malpractice jointly severally action are and liable for entire long as as is determined to have been liability” without fault. “Joint several means when multiple single, injury, injured tortfeasors cause a indivisible may party jointly any all either sue tortfeasors or individual severally, tortfeasor and each individual tortfeasor is liable for the judgment. “joint liability” entire Inherent the term concept plaintiffs recovery compen- is the that a is limited to one injury. jointly severally single sation Because liable trial, may tortfeasor before setoff settle the common-law rule single ensures that the does not recover more than a Tuma Velez rule enables single injury. setoff recovery The common-law for the injury, tortfeasors, the entire remaining are liable for who still any settlement the cotortfeasors’ the amount of to set off Legislature reiterated Because the them. verdict rendered several, cases in most medical Legislature eliminated rule. The setoff it retained the common-law 600.2925d(b) statutory to acknowl- of former MCL setoff rule apply several in actions that involve edge does not that a setoff abrogate rule. liability only, the common-law setoff not to Moreover, correctly the common-law Markley decided. 3. in which the applicable in situation rule remains technical common-law specifically retained the has liability” “joint and several term 600.1483(1), of noneconomic the total amount 4. Under may malpractice plaintiff a medical recoverable $394,200 damages, case. statutory cap in this on those exceed that are noneconomic losses “recoverable” denotes The word necessarily being includes capable recovered and Accordingly, verdicts, settlements, through or arbitration. compensation noneco- thus full plaintiffs actual loss—and —for may single injury he less than what caused nomic losses statutory may limit. in total exceed the and not awards liability apply joint in a medical principles and several of 5. When plaintiffs claim a malpractice and a codefendant has settled case noneconomic-damages trial, apply the the circuit court must before first, statutorily required jury’s well as other cap verdict as to the reducing by the the amount of adjustments, the award before operations that a This ensures settlement. order codefendant’s single recoveiy for his or her plaintiff more than a does not recover loss, purpose the common-law with the which is consistent actual damages. The Court of on noneconomic rule and the setoff apply the Appeals by upholding circuit court’s decision to the erred Rather, court should have the the circuit verdict. the noneconomic- applied rule and first both the collateral-source judgment, damages cap which would constitute arrive at the final to injury by Legis- the compensation her as determined full for Velez’s result, lature, applied setoff.As a Velez and then the common-law $199,200 only from Tuma. entitled to recover respect remanded; appeal Tu- with to and leave to Reversed remaining denied. ma’s issue excep- majority the the with Maekman concurred with Justice Supreme a will not extend the Court tion of its statement by abrogate rules common implication established to statute 1Mich explicitly law. The does not have to state that it is right abrogating abrogate a common-law in for it to a order right. joined by concurring Justice Marilyn Justice Cavanagh, Kelly, dissenting part part, agreed majority dissenting and the with and opinions applies joint that the common-law setoff rule to malpractices cases, but would have affirmed the judgment Appeals’ respect Court of with to how the common-law applied panel clearly by setoff rule be did should because the not err holding applied that the common-law setoff rule should be to the unadjusted jury verdict, Further, traditionally as it had been. Justice agreed with the dissent that the rule to the CAVANAGH unadjusted jury noneconomic-damages cap verdict before the ensures plaintiff single, overcompensated is not for a indivisible injury. Applying impair the rule in would this matter protections by cap. afforded a defendant dissenting, agreed majority Justice with the that the Hathaway, applies plaintiff common-law setoff rule when in a medical malpractice negligent, comparatively is not action but would have upheld judgments respect the lower courts’ to how the applied rule common-law setoff should be to arrive at the final damages by plaintiff. amount of recovered In the absence of statutory authority, rule common-law setoff must be purpose the same manner and for the same as it was at the law, preclude plaintiff being common which was to over- 600.1483(1) compensated single, injury. MCL indivisible MCL 600.6304 make it clear that limitation on applied only damages be should awarded a trier fact, Accordingly, not settlements. settlement amounts should be subtracted from the full amount of awarded the trier fully compensated, of fact to ensure that the but not overcompensated. Moreover, majority’s analysis ignores settling parties’ agreement. terms of the Damages — — — Malpractice Liability Medical —Joint and Several Setoffs Common-Law Setoff Rule. 600.6304(6)(a),

Under in a medical defendants jointly severally action are liable for the entire as long fault; comparatively as the without under liability, multiple single, several when tortfeasors cause a indivis- injury, injured party may jointly ible the sue all either tortfeasors may any severally, or he or she sue individual tortfeasor and each judgment; jointly individual is liable tortfeasor for the entire if a severally trial, and liable tortfeasor settles before v Tuma Velez Opinion op the Court may remaining tortfeasors set off the provides that the setoff rule them; against any verdict rendered amount of settlement setoff rule Legislature not abolish the common-law did liability malpractice joint medical cases and several context of 600.2925d(b), statutory setoff, repealed former MCL when it off from the final PA the settlement must be set but statutorily adjust- any required judgment application after noneconomic-damages ments, including of MCL 600.1483(1) rule of MCL 600.6303. and the collateral-source Granzotto, Granzotto), (by EC. Mark Mark Susskind), for (by Law Firm Judith A. Thurswell Myriam Velez.

Collins, Einhorn, Noreen L. Ulanoff, (by Farrell & EC. Brown) Tuma, M. for Martin M.D. Geoffrey Slank and Amici Curiae:

Kerr, J. Schulte and (by Russell & WeberFLC Daniel Swanson) State Medical Michigan Joanne Geha Medical Association. Society and the American Mary J. In this Kelly, Beth case, defendant, Tuma, Dr. Martin the final rendered seeks reduction of him the of his codefendants’ settlement. This concerns the between interplay case therefore rule, severally whereby jointly common-law setoff a setoff from adverse liable tortfeasor is entitled to settlement, of the cotortfeasor’s verdict the amount 600.1483, cap of MCL which the noneconomic recovery of noneco- malpractice plaintiffs limits a medical we must decide whether the damages. Specifically, nomic abrogate intended to the common-law setoff and, rule and the not, rule if the order which MCL 600.1483 to a damages cap apply Appeals the circuit court and Court of jury’s verdict. Both Health Care Investors held, Markley v Oak pursuant Mich 1 op Opinion the Court Coldwater, Inc,1 that rule applies the common-law setoff the setoff jury’s and that must be to the verdict on damages. of the application before correctly that was agree Markley We decided thus hold did not that abolish the common-law joint setoff rule context several We affirm Appeals cases. the Court of regard clarify Legisla- this and further that where the retained principles liability, ture has applies. common-law setoff rule The lower courts’ of the sequencing setoff and noneconomic damages however, in an cap, contrary results outcome to the that Legislature’s requirement medical malpractice plain- not” tiffs “shall recover more noneconomic than losses Rather, amount determined by Legis- MCL 600.1483. limit authority lature has exercised its a medical malpractice plaintiffs recoveiy by capping noneconomic requiring losses and the reduction of economic losses paid by the amounts applica- collateral sources. Because tion setoff of the to the verdict can result in a beyond statutorily those mandated damages limitations, we further hold that a joint tortfeasor’s settle- ment must be set off from the final after of the application noneconomic damages cap of MCL 600.1483, as well as the collateral source rule. We there- fore portion reverse Court of Appeals’ judg- affirming ment the circuit application court’s rule.

I. FACTS AND PROCEDURAL HISTORY Velez, In September plaintiff, Myriam filed suit Detroit Receiving Hospital, Harper Hospital, 245; Markley v Oak Health Care Investors 660 NW2d Coldwater, Inc, 255 Mich App v Tuma Velez Tuma, alleg- Martin Schwartz and Lawrence and Drs. leg on her timely operate failure to their ing plain- After the knee. below amputation its necessitated sue, hospitals intent her notice of tiff filed agreement with into a settlement entered a total of paid plaintiff defendants those which settlement, lawsuit $195,000. After without prejudice but by stipulation dismissed settlement part a Tuma, who was not respect to agreement. defen- complaint against then filed a new

Plaintiff allega- the same raising January Tuma in dant trial, the four-day jury After tions defendant.2 negligent and professionally defendant to be jury found favor. As plaintiffs $1,524,831.86 verdict returned 600.1483(2), itemized the jury by MCL required economic and it and future verdict, past into separating The awarded damages. and a total of in economic $124,831.86 total damages.3 in noneconomic million $1.4 judgment entered a final the circuit court Before that the circuit favor, requested defendant jury’s to the damages cap the noneconomic apply court $195,000 codefendants’ then subtract verdict and objected, final Plaintiff judgment. from the settlement circuit court argued that Markley, on relying settlement to subtract codefendants’ required de- The circuit court unadjusted “verdict.”4 jury’s citing Markley propo- request, nied defendant’s only, opinion, refers to Tuma Throughout of this “defendant” the rest hospital that settled with to the defendants while “codefedants” refers plaintiff. 600.1483(3) “damages or loss due loss” as defines “noneconomic disfig inconvenience, physical physical impairment, suffering, pain, urement, loss.” or other noneconomic App Markley, at 250-251. 255 Mich

sition that codefendants’ settlement had to be jury’s unadjusted opposed “verdict,” to the as to the “judgment.” agreed plaintiffs interpre- The court Markley. tation of question

The to the Court is whether or not I believe Markley... proposition stand[s] for the subject judgment verdict is to the set off. Or whether the subject set off. Markley says Court believes that verdict. I don’t they meant, literally

know what but I’ll take it and we will apply absolutely it to the verdict. I will concur that that will receiving result in a money more than the amount.

Thereafter, the circuit court entered a awarding plaintiff $394,200, which is the damages cap the noneconomic in this case.5To calcu- late amount, this the circuit court first subtracted $195,000 codefendants’ settlement from the unadjusted plain- total $1,524,831. verdict of Because through tiff’s economic had been satisfied applied sources, collateral the circuit court the collat- plaintiff’s eral source rule and reduced economic damages Finally, to zero.6 the circuit court reduced the remaining damages noneconomic to the amount statutory cap damages, on $394,200. noneconomic circuit court entered a final dispute parties plaintiffs There is no between that damages $394,200. capped are at malpractice cases, In medical requires the collateral source rule circuit court damages by to reduce a award of economic already paid by sources, collateral such as insurers or other providers. dispute plaintiff’s MCL 600.6303. There is no total economic are eliminated the collateral source rule because received, receive, has supplemental and will continue to security Security income benefits from the Social Administration. Velez v Tuma this amount.7 Including prior amount, settlement $589,200. total

In the Court of Appeals, defendant argued that the circuit court had erred by setoff to the jury’s unadjusted verdict rather than to the amount of the final judgment after applying the noneconomic damages cap. The Court of Appeals, however, affirmed the circuit court’s decision apply the setoff to the unadjusted verdict.8 The Court first reasoned that the common-law setoff rule remained applicable medical involving cases joint and several tortfeasors and that the rule should be applied so that a plaintiff will not be overcompensated for his or her actual loss. Turning to the question whether the setoff is to be applied to a jury’s verdict or the final judgment after application of the noneconomic damages cap, the ap- peals panel could “discern no reason why the same principles [now to the repealed] statutory right to [wherein setoffs prior settlements were off set against the verdict] should not apply to the common-

7 Thecircuit court’s calculation can be demonstrated as follows:

Total Verdict Jury $1,524,831.86 - Settlement Setoff $195,000 Post Setoff Verdict $1,329,831.86 ) due to reduction for Damages Economic collateral sources $394,200 due to statutory cap Damages Noneconomic on noneconomic Judgment $394,200 Final Tuma, (2009). 8 Velezv 770 NW2d 89 396; App I 492 MICH Opinion Court addressing . . . .”9 Without right law to setoffs damages, language capping of the statute “ cases where [i]n reasoned that Appeals the Court of fact’s is the trier of joint liability imposed, limit regarding sets the determination for his or her loss.”10The amount a can recover of the setoff application thus concluded “that the Court comprises plaintiffs jury [which rule to the verdict loss], judgment, proper.” than the final is actual rather Court, appeal for in this Defendant leave to Initially, filed a we denied cross-appeal. and granted but later defendant’s applications,12 both we granted appeal, leave to motion reconsideration Appeals the Court of limited to issue “whether in this case was correctly held that verdict, applica- before properly set off damages cap tion the noneconomic of MCL 600.1483 After judgment.”13 hearing and calculation of the final issue, sponte limited we sua argument oral on cross-application granted reconsidered ... Markley leave to to consider “whether cross-appeal correctly ap- decided that the common-law setoff rule in medical actions where plies imposed.”14 several 9 Id. at 412.

10Id. at 413.

11Id. (2010). denial, Tuma, Velezv 488 Mich 903 Before our initial we had abeyance for the resolution of issues not involved in this held the case 2009). (Mich, Tuma, appeal. Velezv 775 NW2d 146 (On (2011). Reconsideration), 489 Mich 956 With Velez Tuma issue, denied, remaining appeal respect because to defendant’s leave to persuaded question presented we are not that the should be reviewed the Court. Tuma, Velezv 491 Mich 873 Velez v Tuma 11

II. STANDARD OF REVIEW questions presented in appeals these are ques- tions of law that we review de novo.15To the extent we must interpret the meaning of applicable statutes, our review is also de novo.16

III. EXISTENCE OF COMMON-LAWSETOFF RULE Plaintiff argues that the Legislature abrogated the common-law setoff rule and thus setoff of codefen- dants’ settlement award is not warranted. In support, plaintiff posits that 161, 1995 PA the Legislature clearly intended to abrogate the common-law rule when it repealed former MCL 600.2925d(b), as added 1974 318, PA which had codified the setoff rule and provided that a settlement “reduces the claim against the other tort-feasors to the extent of any amount stipulated by the release .. . .”

The common law remains force until “changed, amended or repealed.”17 Whether the Legislature has abrogated, amended, or preempted the common law is a question of legislative intent.18 We will lightly presume that the Legislature has abrogated the com- mon law.19Nor will we will extend a statute by implica- tion abrogate to established rules of common law.20 “Rather, the Legislature ‘should speak in no uncertain

15 Allen, Kaiser v 31, 35; (2008). 480 Mich 746 NW2d 92 16 Id. 17 1963, 3, § Const art 7. Engineers Strat, Wold Architects & 223, 233; 474 Mich 713 NW2d (2006). 19 Id. Schultz, Snyder Co, Rusinek v & Steele Lumber 507-508; 309 NW2d 163 1Mich Opinion the Court modify the authority to its it exercises when

terms’ law.”21 common intended to that the conclude

We cannot in the context rule common-law setoff abolish cases. respect with are silent statutes pertinent While rule, we of the common-law application of the statu- repeal agree cannot 600.2925d(b), PA 161 by 1995 setoff, former tory the common- abrogate clear intent demonstrates fact that the ignores argument rule. Plaintiffs law 600.2925d(b) part one of was but of former MCL repeal that there is legislation tort-reform comprehensive and the rule the common-law between no conflict ap- the setoffs prevent that would legislation current joint and sev- reforms abolished Those 1995 plication. an allocation- created in contexts and liability most eral only for tortfeasor is liable in each system which of-fault reflects that the total of portion system Because of fault.22 percentage tortfeasor’s of all the fault incorporates liability already several every individual tortfeasor’s establishing in tortfeasors that the fault, danger is no there proportion by the failure to injury for the overcompensated will be settlement. of another tortfeasor’s off the amount set legislation, tort-reform comprehensive The same and several “joint retained however, specifically also under MCL cases malpractice in medical liability” 600.6304(6)(a) case, the plain- in the where, present as 21 Assoc, 20, 28; PC, Dr Bar-Levav & Dawe v Reuven Hahn, Contracting, (2010), Inc v quoting Hoerstman Gen NW2d 272 66, 74; Mich 711 NW2d Judicature Act to to the Revised 161 added MCL 600.2956 1995 PA only liability is several provide of each defendant that “the joint.” and is not Velez v Tuma tiff is determined to be without For fault.23 reasons we explain, Legislature’s intent unambiguous to main- joint tain this context also evinces clear intent to retain the common-law setoff joint rule in and several liability cases.

The term “joint and several” as used in liability, 600.6304(6)(a), a technical legal It term. has a long- acquired meaning that is well in our juris- established prudence: multiple “[]Where tortfeasors caused a single or indivisible injury, injured party [may] either sue all tortfeasors or he jointly [may] sue individual tortfeasor severally, each individual tortfeasor [is] liable for the judgment. entire .. .”24Consistent with construction, our rules of “technical and phrases, words and such may as have acquired a peculiar appro- priate meaning law, in the shall be construed and according understood to such peculiar and appropriate meaning.”25 Legislature’s use the term “joint therefore, and several” liability, a plain indicates intent adopt meaning. term’s technical legal Inherent meaning and several liability is the concept that a recovery is limited to one compensation for single injury.26 Because some 23 600.6304(6)(a) “joint MCL liability applies that states and several” to malpractice long medical a claim as as the is determined to be fault. without 24 Gerling Allgemeine Lawson, Versicherungs Konzern vAG 472 Mich 44, 49; Donaldson, (2005); 693 NW2d 149 see also Maddux v 362 Mich 425, 433; Gillivan, (1961); Verhoeks v 367, 371; 108 NW2d 33 244 Mich 221 NW 287 25 MCL 8.3a. 26 (“[Under Lawson, principles joint 472 Mich at 49 and severed liability,] each judgment, individual tortfeasor the was liable for entire although injured party compensation only once.”); the was entitled to full (“ Verhoeks, injured party right 244 Mich at ‘The pursue the has to l 492 Mich liable tortfeasor settles severally and jointly

instances a necessary rule is to setoff trial, the common-law before a recover more than the does not ensure that The injury. for the common-law single recovery single tortfeasors, are the who remaining entitles setoff rule off amount of the to set the injury, liable for entire still verdict rendered any settlement from the cotortfeasor’s in most liability that By reiterating them.27 against several, the joint is cases rule. retained the common-law setoff Legislature thus Leg- way, purpose in this understood When setoff not statutory was repeal islature’s rule, but to acknowl- abrogate common-law setoff actions involve does edge apply that a setoff only. liability several Appeals’ Markley decision is consis- Court a There, sought the defendant reasoning.

tent with this joint in the amount of the against verdict re- Appeals The Court codefendant’s settlement. reasoning Legisla- court’s jected the circuit 600.2925d(b) intended of former was repeal ture’s Instead, to a abrogate any right setoff. reasoned: appeals court joint logical [I]t to conclude that common-law setoff is law, cases remained the where new several silent, legislation application of the common- where law not conflict current statutes con- rule does election, severally separate jointly [tortfeasors] at his recover or but, injury being may compen- judgments; single, recover he but one ”) (citation omitted). sation.’ Prod, 1; Lapeer n Thick v Metal 353 NW2d (1984) (“[W]here tortfeasors, against negligence brought action is agrees potential liability paying alleged and one tortfeasor to settle his release, judgment subsequently lump exchange for a and a sum in non-settling tortfeasor, pro reduced entered amount.”). tanto the settlement Velez Tima Opinion op the Court law, cerning conceivably a tort and where overcompensated injury its should rule be general applied. Considering the of nature tone tort legislation, Legislature reform we conclude that the did not recovery greater intend to allow than the actual loss in liability joint and several cases when it deleted the relevant portion 600.2925d], [MCL but instead intended that limiting recovery principles a to the actual intact.[28] loss would remain

Thus, the Appeals Court of held “the principle that setoff, one and the common-law rule joint cases, context of liability several continue to be the law in Michigan.”29 Markley,

After this Court in Kaiser v Allen30consid- ered whether principles joint and several liability and the common-law setoff rule in vehicle-owner vicarious-liability cases. the jury After returned ver- dict in the plaintiffs favor, the defendant sought in the amount of settlement, his codefendant’s which would reduce the plaintiffs award to zero. Because there can no be allocation of fault in vicarious-liability cases and there exists no amount of damages belong to the vehicle owner separately the negli- gent operator, we held that “[t]he tort-reform statutes do not to . apply . . vehicle-owner vicarious-liability cases .... Therefore, the common-law setoff rule re- mains the law Michigan for vehicle-owner vicarious- liability cases.”31 28Markley, App 255 Mich at 256-257. disagree Id. at 257. Markley We characterization oí as “reviving” contrary, the common-law Markley’s setoff rule. To the

reasoning, understanding, reasoning our is consistent with our Legislature preserve joint intended to setoffs of tortfeasor’s settlement expressly because the retained in the medical context. 30Kaiser, 480 Mich 31. at Id. 36. Opinion op the Court dissimilar from factually case is present

While the in Kaiser nonetheless Kaiser, principles espoused statutes; the tort-reform interpretation our support joint has retained Legislature the mainly, that where rule setoff re- the common-law liability, and several acknowl- Indeed, Appeals as the Court of intact. mains conflicting provi- of no are aware edged Markley, in we application, setoffs prevent would sion that reasoning and Given our has identified none. Kaiser, Markley that in we cannot hold our decision we hold decided, urges. Accordingly, wrongly as law in rule remains the common-law setoff cases. liability We joint several Kaiser, in our decision clarify, consistent with further specifically has retained Legislature that where the liability,” “joint term technical common-law applicable. setoff rule remains the common-law RULE APPLICATION OF COMMON-LAWSETOFF IV rule the common-law setoff Our conclusion cases applicable several remains Rather, must address the analysis. our we does not end in which to the common-law sequence apply issue cap on noneconomic dam- statutory rule and the examine the We therefore verdict. ages rule and MCL between the common-law interplay that we are the stewards of cognizant We are 600.1483. presumed the common law and that legisla- enacting of the common law when to be aware statutory construing language function in tion.32Our Plain and clear intent.33 Legislature’s to effectuate intent, of that and such is the indicator language best 32 Co, (2005); Henry 63, 83; v Dow Chem Mich 701 NW2d 684 Co, 494; Electric Nation v W D E Mich NW2d 33 Nation, 454 Mich at 494. Velez Tuma statutory language must be enforced as written.34 Fur- ther, a statute derogation the common law will not be construed to abrogate the by common law implica- tion, but if any doubt, there is the statute is to be given the effect that makes the change least the common law.35 agree

We with defendant that the lower courts erred setoff before applying the noneconomic damages cap, thereby allowing plaintiff to recover a total judgment beyond what Michigan law permits. While Court Appeals properly recognized that the applies common-law setoff rule in this case and is necessary to ensure that a plaintiff is not overcompen- sated for his her injury, or Court erred failing to address mandatory how the limitation on noneconomic application affects of the setoff. 600.1483(1) noted,

As MCL limits a plaintiffs dam- for ages “noneconomic losses recoverable” and pro- vides, in part: damages In an alleging action for

by person or a party, or the total amount of damages loss plaintiffs, noneconomic recoverable all resulting negligence from the defendants, of all shall not .[36] $[394,200] exceed ... This language an mandates absolute cap on all available noneconomic losses: a medical malpractice plaintiffs “total of amount” noneconomic*damages “recoverable” “shall not exceed” the statutory cap. Use of the term “recoverable,” giving plain it its meaning, denotes non- 34 Naini, 239, (2011). 24; Driver v 247 n 802 NW2d 311

35Nation, 454 Mich at 494. 36 Emphasis Although dispute added. regarding cap there is no the case, adjustable cap this the amount of the “at the end of year percentage each calendar change reflect the cumulative annual 600.1483(4). price the consumer index.” MCL 1 492 MICH

Opinion op the Court recovered, being are of capable that economic losses settle- recovery through includes necessarily which the term ments, verdicts, or Because arbitration.37 jury for noneconomic “total” modifies “amount of all recoverable,” it clear that such sums makes loss cap. Legislature, “shall not exceed” recovered MCL of through unambiguous language 600.1483(1), plaintiffs then determined that has compensation full noneco- actual loss—and thus —for may be single injury caused less nomic losses may not in total exceed the than what a awards statutory limit.38 MCL 600.1483

Despite unequivocal language the statute is silent damages, noneconomic limiting is to be both respect when and in relation to common-law setoff.39 generally traditionally And setoff rule is while definition, rely statutory may dictionary In of a we on the absence 1, 18; of HospManagers, Mich definitions. Coxv Flint Bd 651 NW2d ed) (9th broadly Dictionary Black’s defines “recover Law however, “[cjapable being able” to mean recovered.” Justice Hathaway, language we have added to MCL 600.1483 because the claims that provision no at all.” at 36. “makes reference to settlements Post This entirely interpretation ignores the term the breadth the definition of “recoverable.” 600.1483, provi Hathaway MCL and other Justice mischaracterizes limiting damages, “preclude as sions measures 32, receiving overcompensation,” post opines at a “court must being overcompensated,” post at determine whether however,by automatically explained, limiting a verdict of 33. As we have cap, sets the to the amount of 600.1483 cap represents compensation allowed. Because the total amount compen legislative policy predetermined on a total limitation injuries, determining to noneconomic it forms basis of what sation for damages necessarily recovery represents a over extent noneconomic predetermined compensation, a and court cannot exceed that limitation compensation. on trial to directs a court make certain deductions from 600.6306 entering judgment, jury’s damages a it of before final but does a award Velez Tima verdict, a applied to we do the statutory not view silence or the traditional of application the common-law be of dispositive Rather, to the sequencing issue. legislative 600.1483, clear directive of MCL when considered with juxtaposition purpose rule, provides common-law setoff necessary guid- ance. a Because medical malpractice plaintiff cannot operation law recover more noneconomic limit, than statutory it follows that a full noneconomic losses for the single injury— assuming jury verdict the cap legisla- exceeds —is to tively predetermined be limited to the statutory If a plaintiff amount. has been partially compensated through prior a settlement from jointly and severally tortfeasor, liable then the rule, common-law setoff con- sistent purpose statute, with its and the must be to ensure the plaintiff is not compensated beyond statutorily permissible result, limits. To achieve this provide guidance respect application to or the common-law setoff part: rale. MCL 600.6306 states in relevant (1) hy After a verdict rendered trier fact in of a favor

plaintiff, judgment an order of shall be entered the court. Subject 600.2959], [MCL order of shall be entered defendant, including third-party defendant, each in the following following judgment order and in the amounts: (a) past damages, All economic payments less collateral source provided as for in [MCL 600.6303].

(b) past damages. All noneconomic (c) damages, All future economic less medical and other health costs, payments care and less collateral source determined to be 600.6303(5)] gross [MCL under present collectible reduced to cash value. (d) All future medical other health care costs reduced to gross present cash value. (e) gross All future present reduced cash value. l Opinion of the Court a verdict must be from subtracted settlement after as as well damages cap, of the noneconomic application rule; otherwise, the could plaintiff the collateral source is, that compensation, than or her full recover more his amount, plus could the settlement the recover statutorily of the and the amount cap the amount damages, any.40 economic if permissible did the courts in this case. exactly Yet what lower this Appeals recog- the circuit nor Court Neither the court statutorily limited a medi- Legislature nized that the has and that setoff must plaintiffs recovery cal malpractice not an the does recover applied be to ensure that than the has fixed amount more that which Instead, the courts the mandate of ignored statute. lower loss,” “actual or plaintiffs and measured 600.1483 This jury’s full as the verdict. erroneous compensation, that legally led to the incorrect conclusion reasoning could single injury her not exceed verdict, thereby the justifying the amount of setoff verdict, judgment, appli- than the after rather rule. cap cation of the noneconomic collateral source application Hathaway that our of the setoff creates Justice contends rule or its “new that bears little resemblance the common-law setoff rule recognize underlying post purpose,” and that our failure to the verdict at obvious,” compensation “disregards post at 34 as the of full measure However, Legislature’s cap on noneconomic creation of before damages, no the common to make the distinction that there was need for law therefore, recognize. not, ignored the setoff tradition we We have that has Rather, ally jurisprudence, applied been to the verdict. with our consistent have rule and the statute in the manner we both common-law Nowack, See, People purposes e.g., gives best to the ofboth. that effect (2000) adopted 392, 406; (noting the common law Mich 614 NW2d 78 jurisprudence that it with our state and into our to the extent is consistent statutes). Consequently, inter federal it is dissent’s constitutions pretation purpose and the fails to both the statute effectuate because, dispute, interpretation its the dissent common-law rule as does malpractice plaintiff to recover more than would allow a medical statutorily limited amount. Velez v Tuma By applying directly unadjusted verdict, to the the lower courts thus subverted both the clear directive of MCL 600.1483—that medical malpractice plaintiffs not beyond recover noneconomic losses the legislatively deter- mined amount —and the purpose setoff rule —to ensure that overcompensation does not occur. Under the lower courts’ application of the rule, $195,000 common-law setoff plaintiff recovered more than her actual loss as determined Legislature. Because plaintiffs zero, economic losses were because of sources, collateral the remaining final $394,200 after necessarily was cap composed only noneconomic losses. Plaintiffs total all tortfeasors, however, $589,200 is —which $195,000 more than that allowed by the collateral source rule and the cap on noneconomic damages.

Plaintiff would have us affirm the lower courts’ erro- neous application rule, but her argument fails due to similar shortcomings. Like the Court of Appeals, plaintiff and Justice HATHAWAY’s dissent assert that the measure of her actual losses for purposes of the setoff is the verdict and that she can be only overcompensated for purposes of the common-law setoff rule if she receives more than the jury’s verdict. Plaintiff cites both Kaiser and Markley for the proposition that the unadjusted jury verdict is measure of the one full recovery to which plaintiff entitled, but these are cases simply inapposite. Kaiser involved a vehicle owner’s vi- carious liability for those who vehicle, drive the owner’s and there is no similar damages cap in the context of vehicle-owner vicarious-liability cases. It was not neces- sary for Kaiser to address the interaction between a statutory limitation on and the common-law and, thus, setoff distinguish between “judgments” and “jury verdicts” as the measure of the one full recovery to which a plaintiff is entitled. Markley also does not support Mich 1 Markley itself Indeed, acknowledged

plaintiffs position. cap” the damage no reason to address [was] that “there Kaiser, it was rule.41 Like the setoff when Markley distinguish “judg for to between unnecessary as the measure of actual “jury ments” and verdicts” in Rittenhouse v Plaintiff also cites our decision loss. but Rittenhouse Erhart42 proposition, for the same it did not address the inter unhelpful because likewise and the common-law damages cap action between the rule.43 41Markley, App Mich at 258. Erhart, 166; 380 NW2d 440 Rittenhouse argue Hathaway support, plaintiff additional and Justice As damages plaintiff limit the total amount of noneconomic 600.1483 does not 600.1483(1) awards, may only applies jury to not recover because MCL 600.1483(1) applies Specifically, posits the dissent that MCL settlements. 600.1483(2), only jury language which to awards because the of MCL only requires juries “awarding damages” damages,” “itemize refers logically jury This does not follow when the subsections awards. conclusion 600.1483(1) together jury are read because MCL makes no reference to award, phrase “the total but uses the broader Hathaway noneconomic loss recoverable....” Justice further asserts that awards, settlements, Legislature only intended to be reduced 600.6304(5) damages cap the noneconomic because MCL is silent with any by provision respect to reduction reason of a settlement. Post at 37. That damages” requires a circuit court to reduce an excessive “award of to the silence, however, damages cap. the This does not amount of noneconomic preclude applying a court from the common-law setoff rule after damages jury Finally, arguments cap the noneconomic to the verdict. these unavailing interpret damages cap are to the noneconomic as because applying only jury nugatory and would render the to awards not settlements 600.1483(1), explained term “recoverable” in MCL which as we have does recovery Plaintiff the not delimit the manner in which is obtained. “ give adopt one we cannot because we ‘must effect dissent’s construction is every word, interpretation phrase, in an to and clause a statute avoid ” Patel, nugatory’ any part that of the statute ... Jenkins would render omitted). (2004) (citation 158, 167; Justice 684 NW2d 346 Legislature plaintiff, simply neglects did like to consider that the Hathaway, damages greater plaintiff than that not intend a to recover noneconomic damages by plaintiffs noneconomic allowed the statute and that of is, effect, by set law. Velez v Tuma Accordingly, principles we hold that where liability apply malpractice several a medical case and a plaintiffs trial, codefendant has settled a claim before jury’s circuit court must first to the the apply verdict damages cap, statutorily noneconomic as well as other required adjustments, reducing by before the award the Here, amount plaintiff of the codefendant’s settlement. received a settlement from codefendants in the $195,000. defendant, against At a later trial $1,524,831.86. returned a verdict for for plaintiff Given holding, our it error for the lower courts to apply Rather, verdict. order proper operation was to first both the collateral apply source damages rule and the noneconomic at the arrive final which is full for judgment, plaintiffs compensation her as determined injury Legislature.44 Because already partial compensation has received for injury, application of the common-law setoff rule requires that codefendants’ settlement be subtracted from the final judgment so that does not receive more than a single recovery single for her injury.45 plaintiff is entitled to a Consequently, application Justice criticizes this of the setoff rule because it Cavanagh “provides damages cap defendants with both the benefit of the and the further reduction of the common-law setoff.” Post at 28. Yet this result is exactly Legislature what we intend it is what the because also intends. Had preclude inuring intended to this result from to the benefit defendant, phrase of a medical it could have used less broad damages than “total amount of noneconomic loss recoverable” MCL 600.1483(1) prohibited any application or otherwise of the setoff rule. 45 By allegedly reducing plaintiffs damages “noneconomic award” Hathaway settlement, the amount of the Justice is concerned that our proceeds decision has assumed settlement consisted of noneco “ignores agreement nomic and that this result the actual settling parties.” holding Post at 39. These concerns are unfounded. Our require damages by does not the reduction of Rather, holding requires amount of the settlement. our a court subtract the entire amount of the settlement from whatever 492 Mich 1 $199,200.46 defendant in the amount of

against holding result and our are accord with This jurisdictions damages- decisions of other with similar Nevitt,47 Hosp Sys, statutes. In Inc v cap Fairfax Virginia Supreme cap Court ruled that the million on $1 a malpractice damages reduces verdict before against settlements are set off it: there “[WJhere by jury judgment by a verdict or a a court care provider ‘injury patient’ health to ... and the in that action and in all total recovered settle- statutory adjustments. remain the relevant after Nor have we composed solely assumed that the settlement in case this of noneco damages. Indeed, admits, nomic as the dissent the settlement was an aggregate damages, including all award for economic and noneconomic costs, fees, damages, attorney aggregate award, and interest. As an subtrac adjusted tion ofthe settlement from the verdict in this case does alter the settling agreement. parties’ terms of the collateral While sources that exist zero, happened in this case to reduce the economic order- of-operations today verdicts, applies adjusted rule that we establish to all they only damages, only damages, whether contain economic noneconomic or some combination thereof. equation This can be summarized as follows: Total Verdict Jury $1,524,831.86 reduced to $124,831.86, $0 Damages Economic collateral sources reduced to $1,400,000, due $394,200 Damages Noneconomic on (cid:127) Settlement Setoff $195,000 Judgment $199,200 Final (1995) 591, 599; Hosp Sys, Nevitt, Inc v 249 Va 457 SE2d 10 Fairfax (citation omitted). Velez Tuma v Opinion the of Court ments related to the medical malpractice injury exceeds dollars, one million the total amount the plaintiff can recover for that injury is one million dollars.” Similarly, in Semsker,48 Lockshin v Maryland the Court of Appeals ruled that “any verdict by jury rendered exceeding the amount of the damages non-economic cap inherently is a verdict in the amount of the from the moment it is rendered.” The court therefore concluded that “the appropriate order of operations is to apply first the cap to the jury’s verdict for non-economic damages, fol- lowed a credit for tortfeasor settlement.”49 Plaintiff criticizes this position and claims that it requires itemization of settlements. po- Plaintiffs sition actually causes perceived harm, this however. When a judgment contains both economic and noneco- nomic damages, a circuit court the setoff to the jury’s verdict application of the collateral source before rule would have to determine how allocate the settlement between economic and noneconomic dam- ages. This ais result condone, we cannot not only because it can result in an outcome contrary to the mandate of MCL 600.1483, but also because it could discourage settlements in instances which there are Semsker, 257, 283; Lockshin v 412 Md 987 A2d 18 jurisdictions Id. required application Numerous other have also of damages caps setting noneconomic before off a settlement so that do permitted by not recover more applicable than law. See Mayes Bryan, (2006) App 1075, 1099-1103; v Rptr 139 Cal 4th 44 Cal 3d 14 (holding properly applied that the trial court damages cap, the noneconomic 3333.2, Cal reducing Civ Code percentage first before plaintiff fault already attributed to the settlement had recovered because $250,000 “the could not recover more than in noneconomic dam ages providers from all health injury,”); care for one Garhart Columbia/Healthone, LLC, 2004) (Colo, (holding 95 P3d damages cap allowing noneconomic $250,000, a total Colo Rev 13-64-302, Stat must be to a allocating verdict first before fault settlement, attributed to a so that the does not recover more than cap). l Additionally, in instances related defendants.50

multiple of the settle- composition which present, like the guess left to would be unknown, circuit courts ment is Requiring be allocated. should at how settlement from which a engage guesswork, this circuit courts result, unreasonably could outcomes range potential are, in they them with determination burdens to make. ill-prepared any statutory guidance, absence court hand, that a circuit the other holding, on Our judg- final from the the total settlement must subtract pro- the settlement ment, no need to allocate creates be- economic or ceeds between Rather, the settlement the setoff. fore against be aggregate an award to treated as loss, judgment the final meaning actual total plaintiffs statutory adjust- applicable of the application after ments.

V CONCLUSION not abolished has To the extent liability, principles and those joint several principles remain the law setoff rule and the common-law conclusion, and reached this same Michigan. Markley Mark- conclude that invitation to plaintiffs we decline Further, and sev- decided. when wrongly ley was in medical apply eral principles the final must be set off from cases, any settlement of the noneconomic application after courts source rule. The lower and the collateral rule, malpractice plaintiffs an would have Under entirely agreements economic dam as incentive to structure settlement wipe expects out ages, especially collateral sources to when the however, codefendants, might settling damages. be The all economic knowing agreement, unwilling it could into such an to enter potentially sour business rela potentially prejudice their associates tionships. Tuma Velez v Opinions Markman, J., Cavanagh, J. erroneously set off codefendants’ settlement verdict, which resulted in plaintiff receiving $195,000 more for injury her than permitted by law. Accordingly, we reverse the portion Court of Appeals’ judgment upholding the circuit appli- court’s cation of the common-law setoff rule and remand to the circuit entry court for of an reducing order the final judgment by $195,000.

YOUNG, C.J., and Markman (except fourth 11) sentence third paragraph on page ZAHRA, JJ., concurred J. with MARY KELLY, BETH MARKMAN, J. I (concurring). concur in the majority opinion with the exception of the majority’s statement that “we will [not] extend a statute by implication to abrogate established rules of common law.” Ante at 11. I do believe that a may by statute implication abrogate established rules of common is, law. That the Legisla- ture does not have to explicitly state that it is abrogat- ing common-law right order for it to abrogate right. Legislature’s intent to abrogate the common may law sufficiently be clear without its having to explicitly state that this is its intent. A legislative body need not provide a running commen- tary of the effect of its actions on the common law when its actions will admit only of the most obvious interpre- tation. The statement is unnecessary to the opinion, injury no would be done to the opinion it were not I join there. the majority I because believe Legisla- the not, ture has either expressly implicitly, or abrogated the common-law setoff rule the context of joint and several liability medical malpractice cases.

CAVANAGH, J. (concurring in part and dissenting I part). agree with both the majority and dissenting 1 492 Mich by

Opinion Cavanagh, J. applies opinions rule setoff the common-law that the context malpractice that the indication There is no

cases. abrogate Legislature the common-law intended statutory setoff the it eliminated rule when setoff 600.2925d(b).1 Contrary rule in MCL legislative argument, intent to of clear in the absence repeal “[t]he abrogate law, of a statute the common the it was before rule as the common-law revives People 8;1,Mich Reeves, 448 enacted.” statute was NW2d 160 judgment of the Court however, would, affirm I respect Appeals the common-law setoff to how my panel applied view, because, in be rule should holding clearly by that the err did not traditionally has as it be should apply unadjusted jury verdict. To been—to operation the medical after common-law setoff noneconomic-damages cap provides malpractice de- both the benefit fendants with I of the common-law setoff. further reduction and the jury agree verdict with Justice HATHAWAY damages plaintiff represents the total amount applying the common-law and that to recover entitled operation unadjusted jury verdict before setoff to damages cap not ensures of the overcompensated injury. single, Fur- indivisible for a to the unad- the common-law setoff ther, impair protections justed verdict does by the medical to a defendant afforded damages cap, intended. as J. J., concurred with Marilyn Cavanagh, Kelly, 600.2925d(b), PA was deleted as added Former MCL PA 161. v Tuma 29 Velez by Dissenting Opinion Hathaway, J. I HATHAWAY, generally agree J. (dissenting). a trier of fact determines that a

majority that when case is not compara- in a medical rule applies. the common-law setoff tively negligent, in However, I with the manner which the disagree it does so a fashion majority applies this rule because today’s the rule’s Because contrary purpose. that is rule, I departs from the common-law setoff decision dissent. respectfully many years,

For the rule this state was jointly held to be concurrent tortfeasors were liability operated liable. Joint and several severally tortfeasor, injustice the full burden of the on a place injured than on the When a defendant is party.1 rather liable, severally that defendant is liable for jointly injured damages, including damages all the for party’s a injury by nonparty, caused a codefendant or order injured party fully compensated.2 to ensure that an is A corollary is the common-law setoff rule.3 Common-law setoff injured in the that an grounded principle party entitled to one only single, indivisible injury precludes injured receiving an party recovery.4 Thus, double an historically, injured when party single, injury suffered a indivisible as a result of tortfeasors, negligent conduct of two or more paid by settling defendant was “set off” or subtracted from the verdict the trier of awarded 1 Donaldson, 425, 432-434; Maddux v Mich See NW2d 33 Tuma, (1961); 396, 409; (2009); Velezv Bell App 283 Mich 770 NW2d 89 Ren-Pharm, Inc, (2006). 464, 471-472; App 269 Mich 713 NW2d 285 2 Id. (2008) Allen, 31, 41; (Kelly, J., Kaiser v 480 Mich 746 NW2d 92 concurring). Schuknecht, 419, 423; See Larabell v 308 Mich 14 NW2d 50 i Opinion Dissenting Hathaway, J. carried out of setoff application The common-law

fact.5 fully injured party of the rule: purpose overcompensated.6 but not compensated, in former rule was codified The common-law setoff statutory PA 318 and this by 1974 MCL 600.2925d in the same applied rule was of the setoff version in which at common law instances manner as it was severally and liable. How- jointly were the defendants eliminated ever, statutory subsequently setoff was joint liability for 161, along PA with statute Because no relevant virtually all tort claims.7 setoff, question arises whether currently addresses to apply intended common-law setoff Legislature joint and categories of tort claims for which the limited factually dis- liability Although was retained.8 several 31; case, Allen, 480 Mich to this Kaiser v similar answering this (2008), guidance provides NW2d question. the issue of whether the common-

Kaiser addressed and against to claims owners applies law setoff rule liability vicarious of motor vehicles when operators In statutorily holding imposed. cases, explained: Court

setoff rule to such this applies principle on the The common-law setoff rule is based only for the plaintiff entitled to one full right pursue injury. injured party An has the same jointly severally sepa- multiple and recover tortfeasors however, only single injury can lead to judgments; rate single compensation.

5 Id.

6 Kaiser, 480 Mich at 39-40.

7 MCL 600.2956. 600.2956, liability See, example, which retains vicarious for for 257.401(1), liability employers, retains vicarious and MCL which vehicle owners. Velez v Tuma Dissenting Opinion by Hathaway, J. Allowing plaintiff

... to recover the entire verdict [vehicle owner] Allen proceeds to retain all the from the operator] [the settlement with vehicle’s would plaintiff allow the to recover four times more than the plaintiff determined injuries. should be awarded for his did not intend that a be awarded damages greater than the vicarious-liability actual loss in cases, resulting recovery. in a double The common-law setoff rule should be to ensure only that a recovers those to which he or she is entitled as compensation injury... for the whole .

To the extent that principles several abrogated by statute, have not been they intact, remain and the common-law setoff rule remains the law Michi gan cases.[9] regard vicarious-liability to vehicle-owner Thus, recognized Kaiser that when a party suffers a single, injury indivisible as the result of the conduct of tortfeasors, multiple the injured is party entitled to be made whole. This means that injured party is entitled fully to be compensated, but not overcompen sated. I see why no reason the principles set forth in Kaiser should not be extended to the category of medi cal malpractice claims that joint also retain and several liability.

Moreover, I believe that in Markley Oak Health Coldwater, Care Investors Inc, 255 Mich App 256-257; 660 344 (2003), NW2d the Court of Appeals correctly reasoned that (citation Kaiser, omitted). 480 Mich at 39-40 malpractice Medical categories claims are bifurcated into two on the plaintiff comparatively negligent.

basis of whether the is Under MCL 600.6304(6)(b), plaintiff comparatively negligent, joint when a is liability abolished, several liability has been and the defendants’ is plaintiff comparatively negligent, joint several. When a is not and several 600.6304(6)(a). liability imposed is under MCL Opinion Dissenting Hathaway, J. liability, it is the switch to several reform and

[w]ith tort joint in common-law logical conclude that to applica- liability the law ... where cases remained several conflict with rule does not the common-law tion of law, plaintiff concerning tort and where current statutes injury its should conceivably overcompensated for is applied. rule not be malprac- in medical correctly held that

Thus, Markley liability, the retain tice cases However, with that applies. setoff rule imposed rule is to be said, if common-law setoff authority, it must be statutory the absence as it was at purpose the same manner and for the same is Otherwise, setoff rule the common-law law. common instead, entirely new rule an being applied; created. of the common- purpose historical undisputed being from preclude plaintiff to

law setoff rule was That injury.11 indivisible single, for a overcompensated accom- setoff rule The common-law only goal. is its any settlement goal by subtracting this plished trier of fact’s determination injury from the damages. When injured party’s the entire amount of mal- rule to medical common-law setoff scheme, the statutory current cases under the practice remains same. overcompensation goal preventing In a medical analyzing whether must be mindful of we overcompensated, has been contain statutes that “tort reform” so-called receiving over- preclude measures fact- example, For many regards. compensation all economic separate finder required ones,12 damages item- with future 11 Kaiser, 480 Mich at 39-40.

12 600.6305(1)(a) (b). MCL 33 Tuma Velez Dissenting by Opinion J. Hathaway, damages future basis13 a year-by-year ized on damages are Economic cash value.14 present to reduced made payments for statutory setoff subject exceed- damages for future Payment source.15 collateral of an purchase $250,000 be satisfied may ing awarded at Noneconomic annuity contract.16 based on different limitations to two subject trial are measures serves Each of these injury.17 the nature of ulti- party may injured that an reduce the amount as a result of in a entered receive mately These measures or her favor. rendered his verdict that a medical reduce the greatly possibility overcompensated. be can plaintiff malpractice plaintiff a medical determine whether To analy- a multistep actually overcompensated, has been discussed principles all the required is that considers sis the plaintiff is to consider whether step above. The first If the was com- negligent. plaintiff comparatively liability is several negligent, a defendant’s paratively his or such, only responsible for and, as the defendant In damages.18 these rata share of the pro her because there instances, of setoff is irrelevant the issue being overcompensated. plaintiff possibility is no hand, if the determines On the other court negligent, comparatively was not being overcom- must determine whether so, setoff rule is and, if the common-law pensated instances, has been In after verdict these applicable. rendered, paid amounts any settlement 13 600.6305(1)(b). MCL 600.6306(1)(c). MCL 600.6303. MCL 600.6307. MCL 600.1483. MCL 600.6304(6)(b). 1MICH Dissenting Opinion by Hathaway, J.

arising single, injury from that indivisible must be set off in purpose the same manner and for the same as at Thus, prevent overcompensation. common law—to settlement amounts should be subtracted from the the trier of fact determines is the full plaintiff amount that the entitled recover so that whole, the plaintiff is made but overcompensated.19 opines The majority the verdict must first be applicable reduced on limitation damages;20then, only the verdict is reduced to that after amount, is set any settlement off or subtracted from the reduced Additionally, award. under the majority’s analysis, the entire amount proceeds of the settlement must be set from the noneconomic-damages off portion adjusted verdict, of the net without consideration of whether all the proceeds settlement were compensate intended to plaintiff noneco- nomic I damages. disagree analysis. with this

The majority applies setoff in a manner that is at rule, odds with the which common-law was used to prevent a plaintiff double receiving or overcompensation for a single, indivisible The injury. majority disregards seemingly the obvious—the trier of fact determines the total a plaintiffs amount of dam- ages, and only when receives more than that amount as compensation overcompen- sated. A plaintiff is not overcompensated when he or she receives less than the trier of fact’s determination of required amount that is to make him or her whole. goal rule is merely common-law setoff discussed, requires damages As will be separated MCL 600.6305 to be damages and, accordingly, only into economic and noneconomic amounts paid for like be set should off. The limitations on in MCL contained 600.1483 are com monly “caps” damages. referred to as on noneconomic Velez v Tuma Opinion Dissenting Hathaway, J. under- not to further it is overcompensation; prevent Unfortunately, majority’s plaintiff. compensate goal rule fails to achieve this applying method that it is majority asserts setoff. While common-law a new setoff,” it instead creates “common-law little resemblance to the rule that bears It is axiomatic that underlying purpose. rule or its used, it be rule is to be should if a common-law that it intended for the purposes in the manner and and does logic To do otherwise defies common law. at a new rule in order create judicially more than nothing to be a perceives of the new rule fill the creator to what statutory void. manner of counters that its majority

The lan- by mandated setoff rule is the common-law limita- 600.1483(1), forth the of which sets guage MCL that the limi- majority The claims damages.21 tions on above any recovery preclude tations in this subsection provides: The full text of MCL 600.1483 (1) malpractice by damages alleging or In an action for damages person party, the total amount of or by plaintiffs, resulting from the recoverable all noneconomic loss defendants, $280,000.00 unless, negligence of all shall not exceed defendants, negligence of the 1 or of or more as the result by following exceptions apply the court as determined more of the 600.6304], pursuant for noneco- [MCL which case $500,000.00: not exceed nomic loss shall (a) hemiplegic, paraplegic, quadriplegic or The resulting permanent limbs in a total functional loss of or more following: caused or more of

(i) Injury to the brain.

(ii) Injury spinal to the cord. (b) impaired cognitive capacity permanently The has making independent, respon- rendering incapable him or her incapable independently permanently sible life decisions normal, daily living. performing the activities of l Dissenting Opinion J. Hathaway, regardless that amount an whether award of dam- ages by a trier of fact I is involved. disagree. majority reaches its conclusion by myopically focusing on a 600.1483(1), few selected words of MCL rather entirety subsection, than the of that and then adds language to that subsection that does not exist. It 600.1483(1) argues that because MCL uses the terms amount,” “total “recoverable,” exceed,” and “shall not recoverable noneconomic losses “necessarily include[] recovery through settlements, jury verdicts, or arbitra- tion.”22 However, contrary to the majority’s position, (1) subsection makes no reference to settlements at all. Moreover, when MCL 600.1483 is read as a whole and in conjunction 600.6304, MCL intended, as was it is clear from the text of those sections that the limitations on are only intended to be applied to awards damages, settlements.

The majority’s analysis ignores the full language of 600.1483(2), which requires the “trier of fact” to (c) permanent There damage reproduc- has been loss of or to a organ resulting inability tive procreate. in the (2) awarding damages alleging In malprac- in an action tice, damages the trier of fact damages shall itemize into for damages economic loss and for noneconomic loss. (3) section, damages As used in this “noneconomic loss” means pain, suffering, inconvenience, or loss due to physical impairment, physical disfigurement, or other noneconomic loss. (4) adjust The state treasurer shall the limitation on (1) by noneconomic loss set in forth subsection an amount by year determined the state treasurer at the end of each calendar percentage change to reflect the cumulative annual in the con- price subsection, sumer index. As in price used this “consumer comprehensive prices index” means the most index of consumer available for this state from the bureau of labor statistics of the department United States of labor. 22Ante at 17-18. Tuma Velez v by Dissenting Opinion J. Hathaway, elements of noneconomic the economic

segregate only means that logically language This damages. scope the are within trier of fact by a awards a trier not involve settlements, do subsection, which 600.6304(5) mandates MCL importantly, More of fact. the court damages” is “award of following an only to the that “award” of to reduce 600.1483. in MCL limitation found appropriate 600.6304(5) provides: court malpractice, the alleging medical

In an action 1 of the damages in excess of reduce an award shall the amount of 1483 to forth section limitations set 1483. set forth section limitation appropriate by for either by court or counsel not be advised shall or forth in section 1483 limitations set party of the 1483. provision of section other allow- can be found language However, comparable no of a the amount reduce awards a court ing can be drawn conclusions Thus, logical two settlement. First, Legis- provision. text of this the actual of fact from a trier preclude intend to lature did not neces- that is full amount determining the second, and, whole make the sary to to be a trier of fact intended awards only Legislature If the limitation. noneconomic-damages to the reduced adopted by interpretation had intended that it would to assume logical it would be majority, somewhere to settlement made some reference have Instead, statutory scheme statutory scheme. the absence While respect settlements. silent with setoff, the common-law preclude does not language such over- only when applicable rule is common-law overcom- there is no involved. When compensation apply. does not setoff rule pensation, and in situations authority, statutory In the absence of 492 Mich l by Dissenting Opinion Hathaway, J. where the common-law setoff rule apply, does not there simply no to apply basis the reduction in the manner that the majority requires. case,

In jury this a determined that as a result of defendant Dr. negligence, Tuma’s plaintiff Ms. Velez’s left had leg to be The amputated. jury found that defendant was both professionally negligent and the proximate injuries. cause of jury The re- turned a in plaintiffs verdict favor that included $124,831.86 in damages economic million in $1.4 noneconomic damages $1,524,831. for a total verdict of It is the total verdict that constitutes full recovery and makes plaintiff Only if whole. she receives more than this total amount would she be receiving double recovery or overcompensation. Plaintiff is clearly not receiving double or overcompensation be- cause the trial court reduced the jury amount determined $394,200.23 would make her whole to The trial court reached judgment this first subtracting the settling payment codefendants’ ($195,000) from the total verdict ($1,524,831) and then reducing the net verdict ($1,329,831) to the amount required under MCL (in instance, 600.6303 this the noneconomic-damages $394,200). limitation was The Court of Appeals af- firmed equation. this I agree with the trial court and the Court of Appeals, and the majority errs failing to $124,831.86 The verdict included a damages total of in economic $1,400,000 damages. and a total of damages Economic 600.6304(3) pursuant zero, were reduced to MCL because all economic paid by had been collateral source. Noneconomic 600.6304(5) pursuant were reduced to MCL to the amount of the applicable damages, $394,200. limitation on which at the time was $649,655.59, final totaled which included the reduced verdict in $394,200, $43,000 costs, the amount of $105,812.50 as well as in taxable attorney fees, $106,643.09 statutory covering interest period up judgment. to the date of the v Tuma Velez by Opinion Dissenting J. Hathaway, common- Rather than approach. this take a new rule creates rule, majority law setoff agree with I cannot setoff.” it “common-law simply calls approach. this decision is majority’s regarding final concern

My plaintiff’s amount of the entire concludes that it be set must Tuma’s codefendants prior settlement noneconomic-damages plaintiffs off or subtracted troubling because considerably action I find this award. settling parties. of the agreement the actual ignores it and the between agreement The settlement en- in a document contained codefendants is settling The total Agreement.” to Sue “Covenant Not titled $195,000, agreement and the was settlement for all the settlement states specifically fees, costs, attorney economic, noneconomic, including intended to resolve was This settlement and interest. settling codefendants. claims with all of agreement, of the unambiguous terms to the Pursuant into not allocated $195,000 was the amount of such, logical no As there is damages. category specific were proceeds the settlement that all way to conclude this, majority Despite damages. for noneconomic and instead as- agreement the terms ignores for noneconomic that the entire settlement sumes noneconomic-damages limited damages that are an Because in MCL 600.1483. limitation contained contract, major- parties between agreement making terms unambiguous alter its not free to ity is assumption.24 such an dissent. reasons, I respectfully foregoing

For all the Pool, 188, Prop Liability & Park v Mich Muni Grosse Pointe Co, Liability (2005); Mich Lintern v Mich Mut 198; 702 NW2d 4; 43 NW2d

Case Details

Case Name: Velez v. Tuma

Court Name: Michigan Supreme Court

Date Published: Jul 23, 2012

Citation: 821 N.W.2d 432

Docket Number: Docket 138952

Court Abbreviation: Mich.