Tino v. Stout

• Decision Date: 08 May 1967
• Docket Number: No. A--51,A--51
• Citation: 229 A.2d 793,49 N.J. 289
• Parties: Anna TINO and Pellegrino Tino, Plaintiffs-Appellants, v. Robert F. STOUT, Defendant-Respondent, and Frances Long et al., Defendants.
• Court: New Jersey Supreme Court

Page 289

49 N.J. 289

229 A.2d 793

Anna TINO and Pellegrino Tino, Plaintiffs-Appellants, v. Robert F. STOUT, Defendant-Respondent and Frances Long et al., Defendants.

No. A--51.

Supreme Court of New Jersey.

Argued Dec. 20, 1966.

Decided May 8, 1967.

Richard B. McGlynn, Newark, for plaintiffs-appellants (William E. McGlynn, Newark, attorney for and of counsel).

Rodman C. Herman, Newark, for defendant-respondent (Whiting, Moore, Hunoval & Herman, Newark, attorneys, Rodman C. Herman, Newark, of counsel and on the brief).

The opinion of the court was delivered by

SCHETTINO, J.

This is a joint tortfeasor contribution case.

On June 26, 1952 plaintiffs instituted this action against defendant Robert F. Stout and defendants Frances and Jack Long for damages as a result of injuries suffered on February 1, 1951 by plaintiff Anna Tino, while she was a pedestrian on Lincoln Avenue, Newark. Defendants' vehicles collided at the intersection of Lincoln and Chester Avenues and one of the vehicles mounted the curb and struck Anna Tino.

On December 29, 1954 the Tinos recovered a total judgment of $8,174.95, plus $83.14 costs, against all defendants.

Stout's total insurance coverage, $5,000, and $83.14 costs were paid to plaintiffs by Stout's insurance company. A warrant of partial satisfaction in the amount of $5,083.14 was issued to the Clerk of the Superior Court, acknowledging receipt of that amount, but leaving unpaid $3,174.95. The warrant on its face did not release Stout from his obligation on the balance of the judgment.

Early in 1959, plaintiffs moved against defendants Frances and Jack Long. An attorney for the Longs indicated that the Longs were without assets and would be required to file a bankruptcy petition to discharge the judgment. The attorney proposed a settlement of $350 to avoid the bankruptcy, which proposal was not accepted by the plaintiffs.

Instead, plaintiffs applied for a wage execution against defendant Long. Long requested a hearing on the wage execution application. At the hearing it was again suggested that the parties attempt to settle the claim against the Longs. As a result, plaintiffs and the Longs settled the judgment against the Longs for $750. On April 21, 1960 plaintiffs executed a warrant of partial satisfaction only insofar as the Longs were concerned. The warrant purported to reduce the amount still owed by Stout to $2,424.95.

The whereabouts of defendant Stout during all of this time is somewhat unclear. It is not apparent from the record whether Stout was deliberately hiding in an attempt to avoid his obligations under the judgment or whether he thought his obligations were taken care of by his insurance company. Several attempts were made by attorneys for the plaintiffs in New York and in New Jersey to locate Stout but all these attempts failed. In the summer of 1964 defendant Stout returned to the scene by giving notice to all parties that he was moving for an order directing satisfaction of the judgment as to him. After oral argument, defendant Stout's motion was granted.

Plaintiffs appealed and the Appellate Division affirmed, with one judge dissenting. (90 N.J.Super. 395, 217 A.2d 885 (App.Div.1966)).

The majority opinion in the Appellate Division reasoned that under the decision of Judson v. Peoples Bank & Trust Co. of Westfield, 17 N.J. 67, 110 A.2d 24 (1954) (Judson I), the warrant of partial satisfaction given by plaintiffs to defendants Frances and Jack Long automatically gave defendant Stout the benefit of a Pro rata reduction and as Stout had already paid more than his Pro rata share, the judgment was satisfied as to him also. The dissenting judge held that defendant Stout is entitled only to a Pro tanto credit on the judgment for the amount received by plaintiffs from the Longs. He reasoned that the Judson I case is distinguishable because in Judson I the settlement occurred before judgment, whereas here it occurred after judgment.

Plaintiffs do not seek to upset the Pro rata rule which was adopted in the Judson I case.

Plaintiffs argue, however, that in this case defendant Stout is entitled only to a Pro tanto credit on the judgment for the amount received by plaintiffs from the Longs. Plaintiffs assert that the first warrant of partial satisfaction was an acknowledgment that $5,083.14 had been received by them and authorized the reduction of the judgment to $3,174.95. The warrant on its face indicates that it was not intended as a full satisfaction of the judgment insofar as defendant Stout was concerned. The pertinent part of the warrant reads as follows:

'AND WHEREAS, Anna Tino and Pellegrino Tino have received a partial satisfaction for the same by the payment to them of the sum of Five Thousand and Eighty-three dollars and Fourteen ($5,083.14) Cents, the receipt whereof is hereby acknowledged; from the said Robert F. Stout:

THESE ARE THEREFORE, to authorize you to reduce the amount of said judgment to $3,174.95, insofar as the same affects the said Robert F. Stout:'

Plaintiffs argue that the second warrant of partial satisfaction given to the Longs by plaintiffs differs from the first. In the second, it is clear that plaintiffs and the Longs intended that the $750 received from the Longs was to be a full satisfaction of the judgment insofar as the Longs and the plaintiffs were concerned. This warrant compromised the full amount due on the judgment to the plaintiffs by the Longs for $750. Thus, the plaintiffs were fully satisfied insofar as the Longs were concerned but not as far as defendant Stout for plaintiffs clearly stated that they were not releasing Stout:

'AND WHEREAS, Anna Tino and Pellegrino Tino have received additional partial satisfaction for the same by the payment to them of the sum of Seven Hundred Fifty ($750.00) Dollars, the receipt whereof is hereby acknowledged; from the said Frances Long and Jack Long, These are therefore, to desire and authorize you to enter this acknowledgment of satisfaction upon the record of the said judgment, insofar as the said Frances Long and Jack Long are concerned and to reduce the amount of said Judgment to Two Thousand Four Hundred Twenty-four Dollars and Ninety-five cents (2,424.95) insofar as the same affects the said Robert F. Stout.'

Defendant Stout agrees that the original warrant of partial satisfaction issued by plaintiffs, acknowledging receipt of the $5,083.14 received from Stout's insurance company, did not, in itself, absolve Stout from further liability on the judgment. After this warrant was issued Stout admits that plaintiffs could have pursued him for the remainder of the judgment.

Stout, however, argues that by issuing the second warrant of partial satisfaction, which purports to release the Longs completely from liability on the judgment, Stout is thereby absolved from any further liability on the judgment. His argument is necessarily twofold:

(1) Assuming that the second warrant did not amount to a complete release of the Longs but merely an acknowledgment of satisfaction (analogous to the covenant not to sue in a settlement before judgment) insofar as the Longs were concerned, Stout argues that he cannot be held for further liability as a result of the judgment.

Stout reasons that to give this second warrant any substantial meaning it is necessary to construe it as forbidding not only any action by plaintiffs against the Longs but also as forbidding any action for contribution by Stout against the Longs. Plaintiffs and the Longs agreed on a lesser amount ($750) as an acknowledgment of full compensation from the Longs because of the financial irresponsibility of the Longs. Certainly, the Longs would not have paid anything on the judgment unless they felt that they were being completely absolved from all liability to anyone on the judgment.

However, Stout was not a party to this warrant and it cannot bind him in any way. His contribution rights under the Joint Tortfeasors Contribution Act, N.J.S. 2A:53A--1 et seq., N.J.S.A., arise as soon as he has paid more than his Pro rata share. Any arrangement between the plaintiffs and the Longs cannot affect his statutory rights. In order to completely absolve the Longs, the Pro rata rule must be invoked so that Stout's contribution rights under the act would never accrue to him.

(2) From this first argument Stout's second argument may be inferred. By accepting partial compensation, here $750, as full satisfaction for their injuries, at least insofar as the Longs were concerned, plaintiffs indicated an intention to release one tortfeasor, and a release of one tortfeasor releases them all. Thus, Stout is also released.

In addition, plaintiffs argue that the Judson I case is distinguishable in that the settlement with the Longs occurred after judgment, whereas in Judson I the settlement occurred before judgment. Also, the Judson I case is distinguishable in that here the settling tortfeasor was insolvent, whereas in Judson I all the settlers were solvent.

Stout argues that the Pro rata rule should be invoked whenever a plaintiff settles with a tortfeasor, whether before or after judgment and whether or not the settling defendant is insolvent.

The early common law did not allocate the burden of fault between joint tortfeasors and treated joint tortfeasors as jointly and severally liable for plaintiff's entire damages. Although plaintiff was limited to one full recovery of his judgment, the common law gave him discretion as to how he should charge it against joint tortfeasors. Plaintiff could sue either tortfeasor separately for the entire amount or, if he sued them jointly, could levy execution on the entire amount against one defendant alone or secure fractions thereof against both. If plaintiff chose to place the burden on one joint tortfeasor, that tortfeasor was helpless to shift any of the responsibility to the more fortunate tortfeasor. See Judson I, supra, 17 N.J., at p. 87, 110 A.2d 24.

This rule had its origin in ...