7.20In the past three decades, there has been a marked trend within in the United States away from joint and several liability and toward some form of proportionate liability. The Restatement on Torts – Apportionment, noted that by 1999 the majority of states (33 out of 50) had modified the common law and equitable positions on joint and several liability and contributions by multiple tortfeasors, but in widely varying ways. Subsequently, a further 11 states have adopted reform, with some completely eliminating joint and several liability.
7.21Commentators have identified several factors contributing to reform. Those favouring reform point to the need to curb the influence of plaintiff-friendly juries in civil trials, particularly in claims for personal injury where a defendant who is only peripherally at fault may be left with considerable liability. Those who are more critical suggest that the burden on defendants is overstated, and lobbying by the insurance industry is the critical factor. The strong personal injury focus makes the particular rationales for reforms in the United States of little direct relevance to New Zealand conditions. However, it is instructive and valuable to look at the United States experience of reform of the rule of joint and several liability because of the range of possible reform models adopted in the different states.
Six jurisdictions retain joint and several liability, while the remaining have adopted one or more of the following elements of reform:
(a) Limit joint and several liability to objectively quantifiable loss. For example under this approach compensation for personal injury on a joint and several basis is only available for medical bills, lost wages, and other quantifiable loss but not for the intangible elements of the loss such as pain and suffering.
(b) Limit joint and several liability to defendants who are “substantially” responsible for the loss. Thresholds for determining when a party is substantially responsible vary across different states, from as low as 15% through to 30% or higher. Some states modify the idea of joint and several liability as between defendants to one of joint liability for the principle defendant only. Under this model, only a wrongdoer who is liable for more than 50% of the damage (or in some jurisdictions, more than 60%), may be required to compensate for the full loss.
(c) Preclude joint and several liability for most forms of negligence, but retain for intentional torts. Some jurisdictions retain joint and several liability for particular forms of negligence that are considered to be more egregious, such as environmental harms or driving while intoxicated.
(d) Limit joint and several liability if there is contributory negligence on the part of the plaintiff. This applies to varying levels. In some states, contributory negligence precludes all recovery. In some states straight proportional recovery applies in cases involving contributory negligence. Some states have adopted the different approach of comparing the plaintiff’s liability with each individual defendant, and allowing the plaintiff to recover (on a joint and several basis) from a particular defendant only if that defendant’s wrongdoing was greater than the plaintiff’s wrongdoing.
(e) Impose a proportional cap on joint and several liability, beyond which the plaintiff bears the risk of loss. The proportional cap varies between different states, for example a more defendant-friendly proportional cap would provide that no defendant will be liable for more than 1.5 times the loss attributable to that defendant. A plaintiff-friendly cap could be 3 times the loss attributable.
(f) Allow joint and several liability up to 50% of the total damage, so that the plaintiff recovers at least 50% of the loss but bears the remaining risk of a defendant who is insolvent or otherwise judgment proof.
7.23Many states combine elements of the reforms listed above in different ways, while others adopt one element only. For example, South Dakota’s rule is enviably brief, providing that “any party who is allocated less than 50 per cent of the total fault allocated to all parties may not be jointly liable for more than twice the per cent of the fault allocated to that party.”
7.24Most recently, Pennsylvania has passed the Fair Share Act 2011, eliminating joint and several liability for negligence (but not intentional torts), with exceptions for defendants who are more than 60% liable; environmental damage cases; and defendants causing damage as a result of driving while intoxicated.
7.25Reform in the United States has been gradual. For example, Oklahoma first restricted joint and several liability in the 1970s and 1980s so that it did not apply in cases of contributory negligence. In 2004, reforms provided that joint and several liability only applied if the defendant is more than 50% responsible or for intentional or recklessly caused damage. In 2009 the intentional and reckless damage exceptions were removed. Only in 2011 did Oklahoma shift to full proportional responsibility.