(Ontario Real Estate Source)
By Brian Madigan LL.B.
In our example, A sustained injuries and damages due to the negligence of both B and C. But, since it was actually just B who came into direct contact with A, then A might decide that just B will be sued.
Let's look at section 2:
Recovery as between tortfeasors
2. A tortfeasor may recover contribution or indemnity from any other tortfeasor who is, or would if sued have been, liable in respect of the damage to any person suffering damage as a result of a tort by settling with the person suffering such damage, and thereafter commencing or continuing action against such other tortfeasor, in which event the tortfeasor settling the damage shall satisfy the court that the amount of the settlement was reasonable, and in the event that the court finds the amount of the settlement was excessive it may fix the amount at which the claim should have been settled.
So, B gets sued by A and is liable for a judgment in favour of A in the amount of $50,000. B can still sue C and claim contribution and indemnity. There are two choices 1) add C to the action by third party proceedings or 2) wait until the judgment is rendered by the court.
It is also contemplated that the first action will be settled rather than tried. In this case, B still has the same rights of recovery. However, this time B needs to prove that the settlement figure, (whatever it was) was reasonable in the circumstances.
In this situation B might reasonably argue that a $40,000 settlement was reasonable since it represented a savings, and that a $60,000 settlement might also be reasonable since it saved the costs of trial.
Should the settlement figure have been $100,000, which a court might conclude was well in excess of a reasonable amount, the court could fix a lower amount.
Again, the right to recover is limited to the apportionment determined by the court, which in the case of settlement shall be determined at the second trial (B vs. C) or in the third party proceedings (B vs. C).
Brian Madigan LL.B., Broker is an author and commentator on real estate matters, if you are interested in residential or commercial properties in Mississauga, Toronto or the GTA, you may contact him through Royal LePage Innovators Realty, Brokerage 905-796-8888
www.OntarioRealEstateSource.com
