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Articles Tagged with Settlement

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the-ardennes-1284651-m.jpgIt is not unusual for a Plaintiff to sue more than one defendant. It happens all of the time in New York.

Think of when a homeowner hires a contractor and the contractor damages a neighbor’s property. The neighbor will most often sue both. In New York City it is not uncommon to have a lawsuit that involves two adjacent buildings. The first one is demolished but, because the shoring used to protect the remaining building is inadequate, the land under the second building shifts a little and the second building cracks. The owner of the second building wants to get paid to repair his damaged property. He sues the owner of the first building, the contractors that performed the work, and possibly even his own insurance carrier if he doesn’t like the way the carrier adjusts his first-party property claim.

What happens, though, when the plaintiff settles with only one defendant and goes to trial against the rest? How does a court decide how much the plaintiff can collect from the remaining defendants?

The rules in New York are fairly straightforward. New York General Obligations Law §15-108 permits a plaintiff to settle a claim with a defendant tortfeasor without risking the discharge of other tortfeasors who might be liable for the injury. When one tortfeasor settles with the injured party, the settlement relieves the settling tortfeasor of liability to any other person for contribution. It entitles the non-settling tortfeasor to assert the settlement as a defense to the injured party’s claim and to obtain an appropriate reduction in damages. In order to keep the rule clear, think of the “tortfeasor” as the party who allegedly did something wrong. In our examples it could be the contractor, the homeowner, or the owner of the first building.

New York General Obligations Law §15-108, provides in relevant part:
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