Shelby v. Action Scaffolding, Inc., CV-90-0102-PR
| Citation | 827 P.2d 462,171 Ariz. 1 |
| Decision Date | 20 February 1992 |
| Docket Number | No. CV-90-0102-PR,CV-90-0102-PR |
| Parties | , 60 USLW 2556 Stephen J. SHELBY, Plaintiff/Appellant, v. ACTION SCAFFOLDING, INC., Defendant/Appellee. |
| Court | Supreme Court of Arizona |
This case requires us to construe various provisions of Arizona's Uniform Contribution Among Tortfeasors Act (UCATA), A.R.S. §§ 12-2501 to -2509. Defendant Action Scaffolding, Inc. seeks review of the court of appeals' opinion holding that the amount a plaintiff receives in settlement from a joint tortfeasor is to be deducted from the plaintiff's damages as determined by the jury before reducing those damages in proportion to the plaintiff's relative degree of fault. Shelby v. Action Scaffolding, Inc., 164 Ariz. 302, 792 P.2d 765 (App.1990); see A.R.S. §§ 12-2504, -2505(A). Action claims that the plaintiff's damages should be reduced in proportion to the plaintiff's fault before deducting the settlement amount from the then-reduced damages.
In his cross petition, plaintiff Stephen J. Shelby seeks review of the court of appeals' holding that the amount a plaintiff receives in settlement from a joint tortfeasor who is sued solely on a strict liability theory is to be deducted from the plaintiff's damages. See A.R.S. § 12-2504. Shelby claims that the whole reduction scheme of § 12-2504 is inapplicable when a plaintiff settles with a joint tortfeasor who has been sued solely on a strict liability theory.
Because this case presents multiple issues of first impression, and because UCATA's significance continues to increase as more and more cases alleging multiple theories of liability against multiple defendants are both filed and defended, we granted review. 1 See rule 23, Arizona Rules of Civil Appellate Procedure. We have jurisdiction under Ariz. Const. art. 6, § 5(3), and A.R.S. § 12-120.24.
On November 5, 1986, Shelby fell approximately 20 feet from a scaffold while hanging drywall at a job site in Pima County. As a result of the fall, Shelby sustained serious and permanent injuries.
Action erected the scaffold for Shelby's employer, Johnson Plastering Company, Inc. General Scaffolding, Inc., a defendant in the trial court, previously sold the scaffolding to Action.
In 1987, Shelby filed a two-count complaint against Action and General. Count One was based on a negligence theory and named Action but not General. Count Two was based on a strict products liability theory and named General but not Action. 2
The case went to trial in March 1989. After all of the parties had presented their evidence, General informed the court that it had entered into a settlement and release agreement with Shelby that provided for a payment of $250,000 to Shelby. The trial court found that the agreement had been entered into in good faith and dismissed General and all products liability claims from the lawsuit. After General was dismissed, Shelby and Action made their closing arguments on the remaining negligence claim.
In its verdict, the jury found that "[Shelby] was totally damaged in the amount of $650,000." The jury also found that "[Action] was liable for 30% of the injury and [Shelby] was liable for 70% of the injury." Neither Shelby nor Action requested the jury to apportion fault to General.
Based on the jury's verdict, the trial court awarded judgment for Action. The trial court also awarded Action its costs as the prevailing party. The trial court based its judgment on the following formula, which it believed UCATA establishes:
Shelby's total damages $650,000
Reduced in proportion to Shelby's relative degree of fault (70% x
$650,000)
----------
Equals Shelby's claim against Action $195,000
Reduced by settlement amount
----------
Equals damages due from Action $ 0
----------
On appeal, a 2-to-1 court of appeals opinion vacated the trial court's judgment and remanded the case for entry of judgment in favor of Shelby in the amount of $120,000. The court of appeals also vacated the trial court's order awarding costs to Action and remanded with instructions to award costs to Shelby. The court of appeals majority based its decision on the following formula, which it believed UCATA establishes:
Shelby's total damages $650,000
Reduced by settlement amount
----------
Equals Shelby's after- settlement damages $400,000
Reduced in proportion to Shelby's relative degree of fault (70% x
$400,000)
----------
Equals damages due from Action $120,000
----------
The difference between the court of appeals' formula, which deducts the settlement amount from Shelby's damages before reducing those damages in proportion to Shelby's fault (the "Settlement-First Formula"), and the trial court's formula, which reduces Shelby's damages in proportion to his fault before deducting the settlement amount from the then-reduced damages (the "Fault-First Formula"), is significant. Based on our analysis in part A, below, we believe that the court of appeals properly applied the Settlement-First Formula to the facts of this case. Further, based on our analysis in part B, below, we believe that the reduction scheme of A.R.S. § 12-2504 applies in this case, even though Shelby sued General solely on a strict liability theory.
This case requires us to decide whether the reduction scheme found in § 12-2504 or the one found in § 12-2505 should be applied first. Section 12-2504 provides in relevant part:
If 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 ... [i]t does not discharge any of the other tortfeasors from liability for the injury ... but it reduces the claim against the others 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 greater.
(Emphasis added.) If we apply § 12-2504 and reduce Shelby's claim by the settlement amount first, we will have effectively adopted the Settlement-First Formula.
On the other hand, if we apply § 12-2505 and reduce Shelby's damages in proportion to his fault first, we will have effectively adopted the Fault-First Formula. Section 12-2505 provides in relevant part:
The defense of contributory negligence ... is in all cases a question of fact and shall at all times be left to the jury. If the jury applies [the contributory negligence] defense, the claimant's action is not barred, but the full damages shall be reduced in proportion to the relative degree of the claimant's fault which is a proximate cause of the injury....
(Emphasis added.)
In determining which of the two reduction schemes the Arizona legislature intended should be applied first, we normally would look to the text of each statute and construe it according to the general rules of construction established by the legislature. See A.R.S. §§ 1-211 to -218 (general rules of statutory construction). We believe, however, that when it adopted §§ 12-2504 and -2505, the legislature did not contemplate which of the two reduction schemes should be applied first. Therefore, any attempt to determine which of the two reduction schemes the legislature intended should be applied first would be futile.
Our belief that the legislature did not contemplate which of the two reduction schemes should be applied first is supported by the fact that neither § 12-2504 nor § 12-2505 expressly provides which of the two reduction schemes should be applied first or how the amount of judgment is to be calculated in cases in which both statutes apply. On the other hand, the 1987 amended version of A.R.S. § 12-2506, although not applicable in this case, expressly provides how the amount of judgment is to be calculated in cases in which it applies. A.R.S. § 12-2506(A) ().
We believe that § 12-2506 illustrates that when it contemplates difficulty in applying its statutes, the legislature knows how to and does provide express guidance for such application. Because no such guidance is provided by either § 12-2504 or § 12-2505, we believe that we can reasonably conclude that the legislature did not contemplate which of the two reduction schemes should be applied first.
Further, we note that § 12-2504 was taken virtually verbatim from § 4 of the 1955 Revised Uniform Contribution Among Tortfeasors Act, and § 4 of the 1955 Revised Act was taken materially unchanged from § 4 of the original Uniform Contribution Among Tortfeasors Act, which was approved by the National Conference of Commissioners on Uniform State Laws and the American Bar Association in 1939 (the Original Act). 3 This history is significant because when the Original Act was approved in 1939, comparative negligence was practically nonexistent. See H. Woods, Comparative Fault § 1:11, at 24-27 (2d ed. 1987) (). We believe that because § 12-2504 is materially the same as § 4 of the Original Act, and § 4's reduction scheme almost certainly did not contemplate any interaction with comparative negligence principles, we are safe in concluding that our legislature adopted § 12-2504 without contemplating whether its reduction scheme or § 12-2505's reduction scheme should be applied first.
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