Sellers Beware
tion as set forth in § 23 is the doctrinal justification for limiting a seller’s right of indemnity to instances of purely vicarious liability
as set forth in § 22.
The Court in Heco hitched its wagon to
§ 22 and abandoned the differential-fault
concept of indemnity without addressing
(and perhaps without realizing) the broader
doctrinal implications of such a major jurisprudential shift. The Court also did not signal any intention of recognizing a right of
contribution consistent with the comparative fault regime that figures so prominently
in §§ 22 and 23 of the Third Restatement.
Although the Court could create a common
law right of contribution in a future case,
this would obviously require judicial intervention in an area the Court has repeatedly characterized as an exclusively legislative
domain. As things stand at present, “passively” negligent sellers have no right of
contribution or indemnity. As a result, Vermont is now even further removed from the
comparative-fault principles that have dominated the legal landscape in most other jurisdictions for the last half century.
Conclusion
Heco is now the law in Vermont but the
law has yet to be fully explained.33 The
Court has, perhaps accidentally, placed itself on a collision course with an outmoded
no-contribution rule of its own making. After Heco it has essentially three options: (1)
recognize a right of contribution as a necessary counterpart to the Third Restatement’s
core indemnity principle it has now adopted in product defect cases; (2) declare its
application of the Third Restatement’s indemnity rule in Heco a misadventure and
resurrect the more robust differential-fault
indemnity doctrine that provides some
modicum of protection for defendants in
no-contribution jurisdictions; or (3) reaffirm
Heco and become perhaps the first American court in modern history to prohibit contribution across the board and limit indemnity to vicarious liability claims only.
The path of the law in this area has not
yet been decisively cut, but the Heco decision does not bode well for sellers exposed to negligence claims in connection
with the sale of defective products. Under
Heco they may be forced to foot the entire
bill for injuries caused by defects they had
no hand in creating. The Third Restatement
instructs that contribution is the preferred
and most equitable method for allocating
liability among joint tortfeasors who are at
fault (albeit in varying degrees) for an injury
or loss. It may be time for the General Assembly to try its hand at hammering out a
comprehensive contribution scheme in an
effort to bring some much needed clarity,
predictability, and fairness to a murky and
topsy-turvy jurisprudence.
24
____________________
Andrew Beerworth, Esq., is a director with the Burlington-based firm of Paul
Frank + Collins P.C. The author would like
to thank Robert G. Cain, Esq. for the valuable input and comments he provided
throughout the composition of this article.
____________________
2015 VT 3.
42 Vt. 343 (1869).
3
132 Vt. 434 (1974).
4
132 Vt. at 435-46.
5
Id. at 437-48.
6
Levine v. Wyeth, 183 Vt. 76, 102 (2006).
7
Hay v. Medical Center Hosp. of Vermont, 145
Vt. 533, 544 (1985).
8
Heco v. Midstate Dodge LLC, 2013 WL
2155550 at * 6-7 (Vt.Super. May 15, 2013) (Crawford, J.) (“The rule prohibiting contribution
among joint tortfeasors is primarily a rule which
permits the plaintiff to select and limit the parties named to the lawsuit … Only in the case of
an indemnity claim is the plaintiff’s autonomy less
than complete … Authority to decide who remains in the lawsuit is redistributed which is why
the indemnity claim is described as an exception
to the rule against contribution”).
9
Levine, 183 Vt. at 101-02 (pointing out that
some jurisdictions reduce verdicts by the dollar
amount of the plaintiff’s settlement with a third
party (pro tanto approach) whereas others require a reduction based on the percentage of
the settling party’s fault (proportional share approach) or require that verdicts be divided equally among all joint tortfeasors regardless of relative degrees of fault (pro rata approach)).
10
Diamond v. Chakrabarty, 447 U.S. 303, 317
(1980).
11
Restatement (Third) of Torts: Apportionment
Liab. § 23 (2000), Reporters’ Note, cmt. a (explaining that most states have statutes allowing
contribution, many of which are modeled on the
Uniform Contribution Among Tortfeasors Act);
but see, e.g., Estate of Dresser v. Maine Medical
Center, 960 A.2d 1205, 1207 (Me. 2008) (recognizing common law right of contribution as “an
equitable right founded on acknowledged principles of natural justice” that ensures “fairness between joint torfeasors whose negligence caused
a third party harm”).
12
7 V.S.A. § 501(f); Swett v. Haig’s Inc., 164 Vt.
1, (1995) (holding that § 501(f) of the Dram Shop
Act explicitly creates a right of contribution and,
therefore, displaces common law rule in cases
that come within its scope).
13
Knisely v. Central Vermont Hosp., 171 Vt. 644,
646 (2000) (“The right to indemnity is an exception to the longstanding rule in Vermont barring
contribution among joint tortfeasors”).
14
Bardwell Motor Inn, Inc. v. Accavallo, 135 Vt.
571, 573 (1977); Chapman v. Sparta, 167 Vt. 157,
159 (1997).
15
White v. Quechee Lakes Landowners’s Ass’n,
Inc., 170 Vt. 25, 28-29 (1999).
16
Id. at 29.
17
Knisely v. Central Vermont Hosp., 171 Vt. 644,
646 (2000).
18
Morris v. American Motors Corp. 142 Vt. 566,
575 (1982)(holding that seller is vicariously liable
for defective product made by another simply for
holding product out as its own).
19
Zaleskie v. Joyce, 133 Vt. 150, 157 (1975) (recognizing that the seller of a defective product
has an implied indemnity claim against manufacturer who created the defect because the parties
in such cases are “not in equal fault”); Morris v.
American Motors Corp. 142 Vt. 566, 576 (1982)
(holding that assembler manufacturer held strictly liable for defective product was entitled to implied indemnity from component manufacturer
1
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THE VERMONT BAR JOURNAL • WINTER 2016
that made the defective part).
20
Heco v. Foster Motors, 2015 VT 3, ¶ 2.
21
Id. at ¶ 3.
22
See gen \