Recently, the New Mexico Supreme Court issued an opinion that addressed whether a tortfeasor was entitled to traditional indemnification, despite New Mexico’s adoption of comparative fault when there is more than one tortfeasor. In this case, the state’s Supreme Court addressed the doctrine of comparative fault, which applies in personal injury claims, such as car accidents, slip and falls, truck accidents, and other claims.
The court held that traditional indemnity does not apply when a jury has apportioned fault and liability under comparative fault rules and determined that one tortfeasor was actively at fault. In their analysis, the court reviewed principles of indemnity and contribution, which are terms that refer to the fault of parties involved in a personal injury lawsuit alleging legal fault. After stating that New Mexico abides by comparative fault rules, the court found that the district court had properly ruled in favor of the plaintiffs and dismissed the grocery store’s cross-claim for indemnification.
The plaintiffs, a mother and her baby, brought a negligence and personal injury claim against a grocery store in Gallup, New Mexico, after a baby changing table fell off the wall because the bolts had allegedly been installed backwards. The plaintiffs amended their complaint to add the installer for the baby changing station, claiming they had negligently installed it. Under the doctrine of respondeat superior, the plaintiffs also alleged negligence per se, strict liability, and other claims.
The grocery store filed a cross-claim, seeking indemnification and a defense against the installer, according to New Mexico law. The installer and its insurer refused to defend or indemnify the grocery store. Ultimately, the court granted a summary judgment motion filed by the installer, finding that the agreement regarding indemnification that both parties had signed was not enforceable.
The plaintiffs settled their claims against the installer and dismissed those claims. After evidence closed at trial, the jury returned a comparative fault form regarding liability. On this form, they were asked multiple questions, including whether the grocery store was negligent and whether this negligence caused the plaintiffs’ injuries and damages. The amount of damages was determined to be $450,000.
After the district court found the plaintiffs had not sought liability or damages from the grocery store for the installer’s acts or omissions, the court dismissed the grocery store’s claim for common law indemnification. The grocery store appealed, seeking a review of the summary judgment order granted in favor of the installer and denying their cross-claim against the installer for common law indemnification.
The Court of Appeals relied on the common law of indemnity and found that the grocery store in fact had a right of indemnification to obtain full recovery of damages. Simply because the jury had apportioned fault, the appellate court had stated, did not mean that the grocery store lost its right of indemnification against the installer. It reversed the district court’s grant of summary judgment, finding there were remaining issues of material fact. The installer appealed to the New Mexico Supreme Court.
The issue before the state Supreme Court centered on whether a party is entitled to traditional indemnification when the doctrine of comparative fault has been applied to the tortfeasors, determining percentages of fault. The installer contended that since the grocery store was held liable for their share of causing the accident, there was no basis for traditional indemnification. The grocery store argued that it remained entitled to traditional indemnification from the installer, since when a jury apportions fault, it does not preclude the grocer’s right to indemnification.
The state Supreme Court made clear that the doctrines of indemnity and contribution can prove challenging to understand. These doctrines address the law’s inability to apportion fault by contribution, or degree of culpability. The court stated that tort law is punitive, and when fault is distributed among multiple parties, the impact is “diluted.”
The court further stated that the inequities caused by not being able to apportion fault led to the development of indemnification. This doctrine allows for a shift in liability from one party to another, when previously only one party was liable.
While traditional indemnity exists with comparative negligence, the court stated that in this case, the plaintiffs had advanced, and the jury had found, theories of liability that argued the grocery store was an active tortfeasor. The grocery store would not be responsible for paying for negligence committed by the installer. The grocery store had acknowledged that it did not have the right to indemnification from the installer for its own, active negligence.
In concluding, the Supreme Court held that the district court had properly instructed the jury on the grocery store’s failing to provide proper instructions for installing the baby changing table, failing to supervise, and failing to inspect. Since the grocer was found actively at fault, the case did not involve true vicarious or derivative liability. The installer, according to the Court, also had no duty to defend under the agreement between the two companies, since the clause was unenforceable according to law.
The state Supreme Court reversed the Court of Appeals, affirming the district court’s dismissal of the grocery store’s cross-claim for indemnification.
At the Law Office of Matthew Vance, we advocate for accident victims throughout Albuquerque and New Mexico as they pursue their right to compensation from at-fault parties. As a New Mexico premises liability attorney, Matt Vance is dedicated to helping injured individuals and their families. Contact our office for a complimentary, no-obligation consultation by calling (505) 242-6267 or using our online form.
More Blog Posts:
New Mexico Court Dismisses Plaintiff’s Damages Claim for Injuries Caused by Allegedly Defective Work Boots, New Mexico Injury Lawyer Blog, January 26, 2017
New Mexico Appellate Court Holds Statute of Limitations Bars Plaintiff’s Claim Against Unlicensed Builder for Injuries Suffered in Fall from Vacation Home Deck, New Mexico Injury Lawyer Blog, January 19, 2017