McWhirter v. Otis Elevator Co.
| Decision Date | 12 August 1941 |
| Docket Number | C. A. No. 201. |
| Court | U.S. District Court — District of South Carolina |
| Parties | McWHIRTER v. OTIS ELEVATOR CO. |
Barron, Barron & Walker, of Union, S. C., and Osborne, Butler & Moore, of Spartanburg, S.C., for plaintiff.
Johnson & Johnson, of Spartanburg, S. C., for defendant.
This is an action by the plaintiff against the defendant for the recovery of damages for personal injuries alleged to have been sustained from a fall down an elevator shaft in the building of the Marion Sims Memorial Hospital at Lancaster, South Carolina, which plaintiff claims was caused by various acts of negligence on the part of the defendant. The answer of the defendant sets up several defenses, included in which are those designated as the fifth and sixth defenses, which are based upon a written agreement alleged to have been executed by plaintiff, in which it is alleged in substance: (1) That, under the agreement, plaintiff has received substantial compensation for his injuries, has released his employer, Marion Sims Memorial Hospital, its agents, representatives and servants, and Liberty Mutual Insurance Company, the employer's liability insurer, from all liability on account of the accident forming the basis of plaintiff's suit, and that the legal effect of the agreement is to operate as a release of defendant under the principle that a release of one joint tort feasor is a release of all, and that an injured person can receive but one satisfaction for his injury; and (2) that by the provisions of the agreement Marion Sims Memorial Hospital and Liberty Mutual Insurance Company acquired whatever rights plaintiff might have had against defendant to the extent of Two Thousand, Six Hundred, Sixty-Five ($2,665) Dollars, received by plaintiff under the agreement and that, consequently, plaintiff is not the sole or real party in interest and has no right to prosecute this action in his sole name.
The matter is before me on plaintiff's motion to strike these defenses on the ground that they are irrelevant, redundant and immaterial, in which it is contended that the agreement is but a covenant not to sue, and its execution does not operate as a bar either in whole or in part to plaintiff's suit against the defendant.
It is true that a general release of one joint tort feasor has the effect of discharging all other joint tort feasors, and a plaintiff may only have one satisfaction, although he has the option of suing joint tort feasors either jointly or severally. Pendleton v. Columbia Ry., etc., 133 S.C. 326, 131 S.E. 265; National Bank v. Southern Ry., etc., 107 S.C. 28, 91 S.E. 972.
The instrument in question, however, after discharging Marion Sims Memorial Hospital and the insurance carrier from all liability, recites that the plaintiff desires that his rights as against the Otis Elevator Company, and its agents and servants, should be preserved, and that he did "contract, covenant and agree that he will not, nor will anyone on his behalf or claiming under him, bring, institute or maintain any action, suit or proceeding of any kind or nature" against the hospital and the Liberty Mutual Insurance Company, or either, but that in so doing he is "reserving his rights fully to bring, maintain and prosecute to a conclusion, or otherwise dispose of as to him may seem proper, any action against Otis Elevator Company and its agents and servants as fully as if this agreement had not been executed."
The plaintiff has asserted in the instrument relied upon by the defendant his full reservation of rights to sue the defendant, notwithstanding his agreement that he would not sue the hospital and its insurance carrier. His right to make such reservation upon the basis of such an instrument appears clearly established by the authorities. 50 A.L.R. commencing at page 1057, 66 A.L.R. 214, 104 A.L.R. 840. The foregoing annotations recognize the rule that a general release so intended discharges all tort feasors, but they also recognize the principle that if the instrument executed is in fact not intended as a general release, or in consideration of full compensation for the damages claimed, it does not prevent an action against other joint tort feasors not protected by the covenant not to sue.
A settlement with and a release of one tort feasor in which the right is expressly reserved against the other tort feasors is not technically a release, but a covenant not to sue. The fact that the covenant not to sue contains expressions showing that the amount received was not in full satisfaction of all the injured party's claims negatives any implication of full compensation, and the plaintiff is entitled to proceed against other tort feasors.
I have no difficulty, therefore, in concluding that the instrument in question shows upon its face that it does not, and was not intended to, have the effect of releasing the defendant, or to constitute full compensation for the injuries plaintiff alleges he sustained. However, the rule is well settled that independent of the precise character of an instrument given by a claimant, that is, regardless of whether it be construed to be a partial release, or a covenant not to sue, joint tort feasors when sued for damages by reason of some alleged injury or wrong, have generally been held entitled to show, for the purpose of mitigating or reducing damages, that the same injury or wrong has been partially compensated by a payment made by another joint tort feasor, by presenting evidence of such a payment, and such evidence has been held proper to be considered in fixing the amount of the damages. Accordingly, the amount paid by one tort feasor to an injured person in consideration of a covenant not to sue, or a release not effective as a full release of the other tort feasors, is to be regarded as a satisfaction pro tanto as to another or other tort feasors liable for the same injury or wrong so as to reduce the amount of damages recoverable from such other tort feasor or...
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...party in interest under federal law, we must first ascertain who has the substantive right of action under state law, McWhirter v. Otis Elevator Co., D.C., 40 F.Supp. 11; Moore's Federal Practice, par. 17.07, 2d Ed. 1948, and as to that, the latter portion of the quoted statute may have an ......
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...A.L.R. Blue Book, Supplemental Decisions, First Permanent Volume, and the explanation of the majority rule in McWhirter v. Otis Elevator Co., 40 F. Supp. 11 (W.D.S.C., 1941). Turning to the Louisiana jurisprudence, the most recent application of this rule is found in Peats v. Martin, 133 So......
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