Reshaping Applicability of The Pennsylvania Fair Share Act: The Impact of Spencer v. Johnson
Under Pennsylvania law, a defendant’s exposure in a multi-defendant case depends upon more than just the extent of fault and total damages at stake. Now, under a more recent interpretation of the Pennsylvania Fair Share Act by the Pennsylvania Superior Court in Spencer v. Johnson, 249 A.3d 529 (Pa. Super. 2021), that exposure may be amplified.
Before delving into the specifics of the Fair Share Act, codified in 42 Pa. C.S. § 7102, it is helpful to understand three key legal terms: joint and several liability, several liability, and comparative negligence.
“Joint and several liability” means that any one defendant who is found liable may be required to pay the full extent of the plaintiff’s damages. For example, a jury awards the plaintiff $10,000. The jury finds that Defendant A is 40% liable and Defendant B is 60% liable. The plaintiff may recover the entire $10,000 from Defendant A, leaving Defendant A to seek contribution from Defendant B for the $6,000 for which Defendant A was not actually at fault.
Under “several liability,” each defendant who is found liable will only be required to pay their proportionate share of liability. Using the same example as above, Defendant A would only be required to pay their 40% share, in this case $4,000, to the plaintiff in a several liability system.
“Comparative negligence” in Pennsylvania means that a plaintiff’s recovery will be reduced in proportion to the percentage of negligence attributed to the plaintiff (unless the plaintiff is greater than 50% liable, in which case the plaintiff is barred from recovering). For example, if a jury awards a plaintiff $10,000 in damages but finds that the plaintiff was 30% causally negligent, the plaintiff will only be entitled to recover $7,000 in total.
Prior to 2011, Pennsylvania was a joint and several liability jurisdiction. Then, in June 2011, the Fair Share Act became law. In short, the Fair Share Act states that a defendant who is found less than 60% liable will only be responsible to pay damages proportional to the fault attributed to that defendant by the jury. Consequently, many in the legal community thought that the Fair Share Act had implemented several liability in cases where a defendant was found less than 60% liable.
Ten years later, the Pennsylvania Superior Court suggested in Spencer that in order for the Fair Share Act to apply, the plaintiff’s comparative negligence must be an issue in the case. While this portion of the Spencer opinion is arguably dicta, it has ultimately been treated as binding precedent by courts in Pennsylvania. See, e.g., Snyder v. Hunt, 268 A.3d 416 (Pa. Super. 2021) (unpublished) (holding that because the defendants “did not appear to allege, much less to prove, that [plaintiff] was contributorily negligent, the Fair Share Act ... does not shield them from the common law of joint and several liability under Spencer.”). This means that a defendant who is found less than 60% liable will be subject to joint and several liability unless there is causal negligence attributed to the plaintiff.
Defendants in health care liability cases are undoubtedly affected by the recent interpretation of the Fair Share Act. To illustrate how consequential these changes can be, here is another example.
Dr. X is an orthopedic surgeon. Dr. X has privileges at Noname Hospital, which does not employ Dr. X or hold him out as their employee. Dr. X’s patient, John Doe, agrees to undergo knee replacement surgery, to be performed by Dr. X at Noname Hospital. On the evening before the surgery, and unbeknownst to the hospital and John Doe, Dr. X suddenly cancels his malpractice insurance policy and loses all of his savings at a casino. The next morning, he fails to meet the standard of care when performing John Doe’s knee replacement surgery, causing John Doe to sustain serious injuries.
John Doe sues Dr. X for negligence, and also sues Noname Hospital for corporate negligence, alleging that they failed to create and enforce adequate policies to ensure quality care. At trial, the jury finds in John Doe’s favor against both defendants. The jury apportions 95% of liability to Dr. X and 5% of liability to Noname Hospital. The jury also awards John Doe $10,000,000 in damages. Under the previous, literal interpretation of the Fair Share Act, the hospital would only be required to pay damages proportional to the fault attributed to it, which would be $500,000. After Spencer, however, the Fair Share Act does not apply because John Doe was not comparatively negligent. John Doe would therefore be entitled to recover the full $10,000,000 from Noname Hospital. Furthermore, given Dr. X’s recent financial woes, the hospital would have trouble seeking contribution from Dr. X.
Let’s take that same example and add one twist: before the surgery, John Doe failed to take pre-operative antibiotics, without disclosing this to hospital staff, which exacerbated his injuries. At trial, Noname Hospital presents evidence of John Doe’s comparative negligence, but the jury returns the same $10,000,000 verdict. This time, however, the jury apportions 94% of liability to Dr. X, 5% of liability to Noname Hospital, and 1% of liability to John Doe for failing to take his pre-operative medication. Now, because the plaintiff’s comparative negligence is at issue, the Fair Share Act will apply, and Noname Hospital’s liability will be several. John Doe can only recover $500,000 from the hospital, and will have to seek recovery of the remaining $9,400,000 from Dr. X.
Ultimately, a health care defendant’s exposure in Pennsylvania depends on the financial solvency and amount of insurance covering the co-defendants, and the comparative negligence of the plaintiff. In cases where comparative negligence is not at issue, liability is joint and several, and the plaintiff can recover all of their damages from any one defendant. When there is good evidence of comparative negligence, defendants should present that evidence at trial in order to potentially obtain the protection of several liability pursuant to the Fair Share Act.
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