What Happens in a Georgia Case if the Plaintiff Settles With One or More Defendants Before Trial?

O.C.G.A. § 51-12-33 (d) (1) states that the “negligence or fault of a nonparty shall be considered if the plaintiff entered into a settlement agreement with the nonparty.”  The statute does not address whether the amount of any settlement is admissible or whether the remaining defendants get any credit for settlement funds paid by a settling nonparty.  Prior to the 2005 “tort reform” bill, which amended O.C.G.A. § 51-12-33, adopted apportionment of damages in all tort cases and abolished joint and several liability, it was the law in Georgia that, “[a] plaintiff is entitled to a full, but single, satisfaction of his total harm. Consequently, where one or more tortfeasors enter a settlement with a plaintiff, a remaining tortfeasor may be entitled to a set off of payments previously made, to prevent double recovery,” Brewer v. Insight Tech., Inc., 301 Ga. App. 694, 700-701 (2009).

It is extremely doubtful whether this long-standing principal of law in Georgia has survived the “tort reform” legislation. Surprisingly, there has been no appellate decision yet directly overruling this line of cases.  The Court of Appeals came close, however, in Union Carbide Corp. v. Fields, 315 Ga. App. 554 (2012), where one of the issues was whether the defendant had to produce evidence of negligence and causation on the part of a nonparty before the jury can even consider apportioning fault to that nonparty under O.C.G.A. § 51-12-33(d)(1).  The Court held that:

“ . . . the fault of a nonparty cannot be considered for the purposes of apportioning damages without some competent evidence that the nonparty in fact ‘contributed to the alleged injury or damages’” (Emphasis supplied)  315 Ga. App. at 559.

“Thus, under this State's statutory scheme, the effect of a successful nonparty defense is the reduction of the plaintiff's potential award and the defendant's possible liability.  As with other affirmative defenses, Defendants have the burden at trial to prove the defense of nonparty fault. Cf. Hodge v. SADA Enterprises, 217 Ga. App. 688, 691 (2) (458 SE2d 876) (1995) (indicating that a defendant has the burden at trial to prove affirmative defenses of contributory and comparative negligence).”  315 Ga. App. at 556.

Then the Court considered whether defendants who settled with the plaintiff before trial should automatically be included on the verdict form for purposes of apportioning fault, and concluded that:

“ . . . when OCGA § 51-12-33 (d) (1) is read together with OCGA § 51-12-33 (c), a defending party still must show that a settled entity “contributed to the alleged injury or damages” before its fault can be assessed by a trier of fact. Otherwise, there would be no basis for the apportionment of fault between the settled entity and the defendant. See McReynolds v. Krebs, 307 Ga. App. 330, 334 (1), 335 (3) (705 SE2d 214) (2010) (rejecting defendant's contention that trier of fact should have apportioned damages between her and a settled party where the defendant presented no evidence on which apportionment of liability could be based and thus waived any issue with regard to the verdict form). We therefore decline to interpret OCGA § 51-12-33 (d) (1) as requiring a trier of fact to automatically consider the potential fault of a settled entity.”  315 Ga. at 558-559.

Under the statutory scheme created by OCGA § 51-12-33, and following the logic of Union Carbide Corp., neither fact of settlement nor the amount of any settlement should be admissible at trial in Georgia, nor should the remaining defendant or defendants get any credit for settlement money the plaintiff was fortunate enough to obtain from a settling nonparty prior to trial. 

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