In a federal district court matter, the district judge ruled that the obligation of a defendant who settled a negligence lawsuit wasn’t “uncollectible” and would not be reallocated between the remaining tortfeasors.
The Illinois Supreme Court, answering a question presented by the 7th Circuit Court of Appeals, concluded that “the obligation of a tortfeasor who settles is ‘not uncollectible’ within the meaning of Section 3.” Section 3 is part of the Illinois Joint Tortfeasor Contribution Act, which states that “no person shall be required to contribute to one seeking contribution an amount greater than his pro rata share,” except when “the obligation of one or more of the joint tortfeasors is uncollectible.”
Two of the seven Illinois Supreme Court justices dissented with a view that this ruling undermined the legislative goal of promoting settlements. The dissent stated that the Illinois Supreme Court’s decision “would likely require the General Assembly to revisit the Contribution Act.”
The underlying lawsuit involved Thomas and Diane Roberts who sued an affiliated group called “The Alex Parties” and two companies, Edwards-Kamalduski and Safety International, for alleged negligence that took place in southern Illinois. Edwards-Kamalduski settled with the plaintiffs for $50,000 and received a good-faith finding from the federal district court judge. The Alex Parties pursued a contribution claim against Safety International after settling with the plaintiffs for $1.85 million in a deal that included a release of the negligence claims against Safety International.
A jury allocated 75% of the fault for the incident to Edwards-Kamalduski, 15% to the Alex Parties and 10% to Safety International.
Concluding that the Edwards-Kamalduski “obligation” wasn’t “uncollectible,” the judge rejected the Alex Parties’ request to reallocate Edwards-Kamalduski’s fault (75%) on a pro rata basis between the Alex Parties and Safety International. The judgment ordered Safety to pay $190,000 in contribution (10% of the settlement).
The appeal from this order focused on Sections 2(b), 2(d), and 3 of the contribution laws. Section 2(b) says “no tortfeasor is liable to make contribution beyond his own pro rata of the common liability,” while Section 2(d) provides that a tortfeasor who settles with the plaintiff in good faith “is discharged from all liability for any contribution to any other tortfeasor.”
Under Section 3, “the pro rata share of each tortfeasor shall be determined in accordance with his relative culpability” and “no person shall be required to contribution to one seeking contribution an amount greater than his pro rata share,” except when “the obligation of one or more of the joint tortfeasors is uncollectible.” In that event, the remaining tortfeasor shall share the unpaid portions of the uncollectible obligation in accordance with their pro rata liability.”
In the majority opinion, the Alex Parties argued that the plain meaning of the statutory term “uncollectible” includes the liability of settling tortfeasors. The Alex Parties note that the word “uncollectible” is defined simply as “not capable of being collected.” The Alex Parties reasoned that, since the settling party is “discharged” from all liability for any contribution to any other tortfeasor,” the settling party’s contribution obligation is legally uncollectible.
The dissent maintained that the majority misinterpreted Section 3. The majority’s holding that a settling tortfeasor’s obligation is “not uncollectible” cannot be reconciled with the legislature’s decision to provide a settling tortfeasor with absolute legal immunity from contribution claims.
Under Section 2(d), a settling tortfeasor “is discharged from all liability for any contribution to any other tortfeasor.” In addition to contradicting Section 2(d), the majority’s decision has the potential to undermine an important legislative goal of the Contribution Act which is the encouragement of settlements. However, given the majority opinion, the Illinois Supreme Court concluded that the obligation of a defendant who settled a negligent claim wasn’t “uncollectible” and could not reallocate between the remaining tortfeasors.
Roberts v. Alexandria Transportation Inc., 2021 IL 126249 (June 17, 2021).
Kreisman Law Offices has been handling catastrophic injury lawsuits, traumatic brain injury lawsuits, motorcycle injury cases, car accident lawsuits, work injury lawsuits, and wrongful death cases for individuals, families and loved ones who have been injured, harmed or killed by the carelessness or negligence of another for more than 45 years in and around Chicago, Cook County and its surrounding areas, including Calumet City, Hinsdale, Inverness, Cicero, Arlington Heights, Gurnee, Orland Park, Deerfield, Chicago (Back of the Yards, Pullman, Pilsen, West Town, Bucktown, Beverly, Roscoe Village, Ukrainian Village, Andersonville, Uptown), Palos Hills, Evanston, Lincolnwood and Elmhurst, Illinois.
Robert D. Kreisman has been an active member of the Illinois and Missouri bars since 1976.
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