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Brief
Summary: Joint and several liability between a
manufacturer and seller of a product is abolished in Tennessee. Joint and several liability in product
liability actions now only apply between manufacturers under the legal theories
of strict liability and breach of warranty.
Analysis: One area of Tennessee law that retained a
portion of the doctrine of joint and several liability since McIntyre v.
Ballentine, 833 S.W.2d 52 (Tenn. 1992) is in products liability actions. The Tennessee Supreme Court in Owens v.
Truckstops of America, 915 S.W.2d 420, 433 (Tenn. 1996) found that “the
adoption of comparative fault did not alter that product liability law under
which the liability of defendants in the chain of distribution of a product,
who are liable under a theory of strict liability, is joint and several.” In other areas of the law the Tennessee Supreme
Court has issued several other decisions over the years that moved away from a
general abolishment of joint and several liability. Therefore, the Tennessee legislature
addressed this issue in the 2013 Tennessee legislative session. It passed Public Chapter No. 317 which was signed
into law by Governor Bill Haslam on April 29, 2013. This Public Chapter created a new statute,
T.C.A. § 29-11-107, which provides as follows:
(a) If multiple defendants are
found liable in a civil action governed by comparative fault, a defendant shall
only be severally liable for the percentage of damages for which fault is
attributed to such defendant by the trier of fact, and no defendant shall be
held jointly liable for any damages.
(b) Notwithstanding subsection (a), the doctrine
of joint and several liability remains in effect:
(1) To apportion financial
responsibility in a civil conspiracy among two (2) or more at at-fault
defendants who, each having the intent and knowledge of the other’s intent,
accomplish by concert an unlawful purpose, or accomplish by concert a lawful
purpose by unlawful means, which results in damage to the plaintiff, and
(2) Among manufacturers only
in a product liability action as defined in § 29-28-102, but only if such
action is based upon a theory of strict liability or breach of warranty. Nothing in this subsection (b) eliminates or
affects the limitations on product liability actions found in § 29-28-106.
This statute takes effect for all causes
of action that accrue on or after July 1, 2013.
The portion of this statute that I want to concentrate on for this post
is the exception found in (b)(2).
Subsection (a) basically declares that for any case governed by
comparative fault, each defendant will only be responsible for the portion of
damages attributed to that defendant by the trier of fact.
This statute significantly alters joint
and several liability in product liability actions in Tennessee even though
there is an exception allowing joint and several liability in certain circumstances. The key language is found in the first three
words of the exception which states “among manufacturers only”. Based on this plain language, T.C.A. §
29-11-107 limits the application of joint and several liability in product
liability cases to simply “among manufacturers”. There is no reference to sellers as defined
in the products liability statute. As a
result, joint and several liability no longer reaches down the chain of
distribution and allows sellers of the product to be jointly and severally
liable with the manufacturer. Further, joint
and several liability will only apply, even among manufacturers, under theories
of “strict liability” or “breach of warranty.”
You may next ask whether both the
manufacturer and seller are required to be parties (and found liable) in order
to take advantage of this change in the statute? The reason you may ask is because the language
in the first part of the statute, subsection (a), which generally abolishes
joint and several liability states “if multiple defendants are found liable in
a civil action.” This can only occur if
they are all parties, right? I think the
answer to this question is “No.” The
reason is subsection (d) which provides as follows:
(d) Nothing in this section limits the ability of
the trier of fact to allocate fault to a nonparty to the suit, including, but
not limited to, an immune third party or a settling party, person, or
entity. Allocations of fault to
nonparties shall be used only to determine the liability of named parties and
shall not subject nonparties to liability in the action in which the allocation
occurred or in any other action.
My interpretation of this section is that
a plaintiff cannot avoid the joint and several liability abolishment between a
seller and manufacturer by simply not adding the manufacturer as a party. This section allows the trier of fact to
allocate fault against nonparties to the suit when comparative fault is
asserted by a defendant. This statute
would not make much sense if the application of joint and several liability depended
on the plaintiff actually adding the manufacturer as a party.
This is a very important new statute for
any Tennessee attorney that practices in products liability actions. The impact could be very significant in some
cases. Obviously, a seller of the
product can still be sued for its own negligence but there is often very little,
if any, negligence by the seller. This
statute could make it very difficult for a plaintiff to recover against a
foreign manufacturer of a product.
Remember, a seller already has significant defenses to a
products liability action as set forth in T.C.A. § 29-28-106 that I discussed
in detail in a previous post.
It will be very interesting to see how this new statute is used in the
years to come. I expect there are more
ramifications that are not yet apparent that will be developed in the case law.
Follow me on Twitter at @jasonalee for updates from the Tennessee Defense Litigation
blog.
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