Are there multiple negligent parties in your subrogation claim? How do you hold everyone accountable in an equitable way? In the episode of On Subrogation: Contribution Between Tortfeasors below, RG partner and subrogation-focused attorney Jason Sullivan explains contribution between tortfeasors – a legal mechanism designed to hold all tortfeasors responsible for negligently-caused damages, no matter how many there are.
Are there multiple negligent parties in your subrogation claim? How do you hold everyone accountable in an equitable way? In the episode of On Subrogation: Contribution Between Tortfeasors below, RG partner and subrogation-focused attorney Jason Sullivan explains contribution between tortfeasors – a legal mechanism designed to hold all tortfeasors responsible for negligently-caused damages, no matter how many there are.
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Contribution between tortfeasors is especially important in subrogation because liability is not always isolated to a single party. Consider a property damage subrogation claim involving a failed electric line that caused a house fire. Liability may fall with the manufacturer of the electric line or the utility company for improperly installing or failing to maintain it, etc. Contribution ensures that one party is not left holding the whole bag of damages when there is blame to go around.
A Hypothetical Case Study in Contribution Between Tortfeasors
Let’s explore a hypothetical situation common in automotive subrogation to illustrate how contribution between tortfeasors works:
There is a rear-end collision involving three cars, but there is only one innocent party: the first car. Your insured is the second car involved, and the other possible tortfeasor is the third car. The innocent party looks to your insured and says, “You’re the one who hit me. You’re the impact I felt. This is your fault”. So you and your insured settle the claim and pay 100% of the innocent party’s damages.
Now, is there a way for you to recover at least some of that payment?
In states that have adopted contribution between tortfeasors (the vast majority have), the answer is yes. In contribution between tortfeasors, if one party pays more than their fair share of damages, they can subrogate against any other tortfeasors who share in the responsibility for said damages.
To learn more about contributory fault in subrogation lawsuits, watch the episode: On Subrogation: Comparative v. Contributory Fault.
Determining the Percentage of Fault Between Tortfeasors
States lay out contribution between tortfeasors in statute, specifying the scenarios in which a subrogating carrier may pursue recovery from another tortfeasor. In some states, contribution rights are closely tied to joint liability rules. Depending on the state laws governing insurance and subrogation lawsuits, an injured party may actually be able to recover all damages from one tortfeasor even if multiple tortfeasors exist. Contribution statutes then allow the paying tortfeasor to seek reimbursement from the other responsible parties according to their proportion of fault.
One of the most contested aspects of these subrogation claims is determining how fault should be allocated among the tortfeasors. For instance, in an auto insurance lawsuit concerning a chain-reaction collision, investigators may need to determine:
- Which vehicle initiated the collision
- Whether following distances were reasonable
- Whether one driver had sufficient time to avoid impact
- Whether later impacts worsened the damage
Accident reconstruction evidence, such as vehicle damage inventory, witness testimony, and dash cam footage, will all play a role in assigning the proportion of comparative fault between tortfeasors.
Accident reconstruction evidence is not always available, but experienced adjusters are usually able to agree to an amount of fault for each party within reasonable ranges.
Learn more about subrogation claims involving chain-reaction auto accidents: Ghost Adventures in Subrogation: The Phantom Vehicle Defense
Properly Navigating Contribution Between Tortfeasors Maximizes Chance of Recovery
There are caveats to this alternate route to recovery in the case where your insured is one of the tortfeasors:
- Before you can seek contribution from another tortfeasor, you must pay for that other party’s alleged liability in full.
- If your insured caused the damage intentionally, there is no contribution.
- The statute of limitations when pursuing contribution from another tortfeasor may be different and/or shorter than the statute of limitations for typical negligence cases. It will most likely begin from the date you pay out the claim.
As a result, best practices when determining if contribution between tortfeasors applies and if it is worth pursuing require a subrogating carrier to ask three questions:
- Does the state in which the incident occurred have contribution between tortfeasors laid out in statute?
- Are there other parties that share responsibility for the incident?
- What percentage of the incident was their fault and, subsequently, is it fiscally worth it to pursue?
Contribution between tortfeasors provides insurers and subrogation professionals with an important mechanism for equitable recovery when multiple negligent parties contribute to the same loss. Successfully pursuing these claims requires careful analysis of comparative fault, applicable state statutes, settlement language, and procedural deadlines.
By identifying all potentially responsible parties early and preserving critical evidence, subrogation teams can maximize recovery opportunities while ensuring liability is distributed fairly among tortfeasors. An experienced subrogation attorney will be familiar with contribution between tortfeasors and will know how to best go about holding additional tortfeasors responsible for their share of the damages.
For More On Subrogation Claims, Strategy, & Other Legalese…
Looking for additional education on the subrogation process and important topics in insurance law? Rathbone Group’s blog articles, YouTube videos, and podcast series offer resources for everybody’s learning style. If you have a question we haven’t yet covered or a suggestion for a future episode, reach out to Rathbone Group at blog@rathbonegroup.com. For more information on our leading nationwide subrogation services, inquire at info@rathbonegroup.com.