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Alsup v. Firestone Tire & Rubber Co.

OPINION FILED JANUARY 20, 1984.

RICHARD F. ALSUP ET AL., APPELLEES,

v.

THE FIRESTONE TIRE & RUBBER COMPANY, APPELLANT.



Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. Myron T. Gomberg, JUSTICE WARD DELIVERED THE OPINION OF THE COURT:

On April 8, 1978, the automobile in which Floyd and Mabel Alsup were passengers and which was being operated by their son, Richard F. Alsup, was struck by one driven by David Williams in which his parents were riding. Each of the Alsups was severely injured. Williams was insured under a policy with a $50,000 one-accident limit for bodily injury. A settlement was agreed upon for the policy limit, and late in 1979 the Alsups executed releases in favor of David Williams and his parents "and all other persons, firms, and corporations, both known and unknown." It is said that at the time the releases were given, the Alsups had already incurred medical expenses in excess of $40,000. A letter from a representative of the Williams' insurer during the course of the settlement to Mabel Alsup's attorney contained the statement that "the policy limits are clearly not adequate in light of the injuries sustained by the Alsup family." Each of the Alsups received roughly equal shares of the $50,000 settlement. There was also a property-damage settlement in the amount of $5,554. Richard and his parents were represented by separate attorneys. The attorneys witnessed the releases of their respective clients.

Floyd Alsup was declared incompetent on March 28, 1980. The complaint alleged that his condition was caused by his injuries. On April 7, 1980, Richard Alsup, individually, and Mabel Alsup, individually and as administrator for Floyd Alsup, filed a products liability complaint in the circuit court of Cook County against Firestone Tire & Rubber Company (Firestone), seeking damages for personal injuries. Firestone was the manufacturer of the tire on the Williams' auto which sustained a blowout causing the auto to veer and collide head on with the Alsups' car. The circuit court denied Firestone's motion for summary judgment, but certified the following question for appeal under our Rule 308 (73 Ill.2d R. 308):

"Whether the terms of a release which include the payer `and all persons, firms and corporations, both known and unknown, of and from any and all claims' provide for the release of an alleged joint tortfeasor pursuant to Section 302(c) of the Illinois Contribution Among Joint Tortfeasors Act (Ill. Rev. Stat. ch. 70, sec. 302(c)), where plaintiffs investigated whether an action could be brought against the alleged joint tortfeasor and believed that no cause of action existed and where plaintiffs have stated in affidavits that they did not intend to release the alleged joint tortfeasors, but where plaintiffs executed the release after consultation with their attorneys?"

In an unpublished order, the appellate court denied the defendant's application for leave to appeal. We granted Firestone's petition for leave to appeal. 87 Ill.2d R. 315.

The releases provided for the release and discharge of the "Payer, and all other persons, firms, and corporations, both known and unknown, of and from any and all claims, demands, damages, actions, causes of action, or suits at law or in equity, of whatsoever kind or nature, for or because of any matter or thing done, omitted or suffered to be done by anyone prior to and including the date hereof on account of all injuries both to person or property resulting, or to result, from an accident which occurred on or about the 8th day of April, 1978, at Bowling Green, Mo." The release further provided that "in determining said sum there has been taken into consideration the fact that serious or unexpected consequences might result from the present injuries, known or unknown, from said accident, and it is therefore specifically agreed that this release shall be a complete bar to all claims or suits for injuries or damages of whatsoever nature resulting or to result from said accident."

Before the settlement agreement and before the execution of the releases, the blown out Firestone tire had been turned over by the Alsups and the Williams' insurance carrier to an independent testing laboratory to determine whether there had been a defect in the tire which might form the basis of a cause of action against Firestone. The laboratory reported that it "found no defects in workmanship or materials in this tire or wheel." The plaintiffs' brief states that "at the time the releases were executed, plaintiffs' attorneys and [the Williams' insurer] were under the impression that there was no case to pursue against Firestone." After the execution of the releases, the plaintiffs received a report from a second testing laboratory stating that the tire had been defective. The report is not included in the record. Which laboratory report is correct is, of course, undetermined.

Section 2 of "An Act in relation to contribution among joint tortfeasors" (the Act) provides in part:

"(c) When a release or covenant not to sue or not to enforce judgment is given in good faith to one or more persons liable in tort arising out of the same injury or the same wrongful death, it does not discharge any of the other tortfeasors from liability for the injury or wrongful death unless its terms so provide but it reduces the recovery on any claim against the others to the extent of any amount stated in the release or the covenant, or in amount of the consideration actually paid for it, whichever is greater." Ill. Rev. Stat. 1979, ch. 70, par. 302(c).

Our statute is based upon the Uniform Contribution Among Tortfeasors Act.

The language of the releases given by the plaintiffs, from which we have quoted, is general and broad. The releases purport to release the payers and "all other persons, firms, and corporations, both known and unknown" from any and all claims resulting from the accident in which the plaintiffs were injured. As appears above, section 2(c) of the Act provides that a release "does not discharge any of the other tortfeasors from liability for the injury or wrongful death unless its terms so provide." The question for decision is whether the releases given by the plaintiffs satisfied the condition, viz, "unless its terms so provide."

The plaintiffs contend that the Act requires a release to name, or otherwise specifically identify, another tortfeasor in order to discharge that tortfeasor from liability. They say that the inclusion of general language such as "all other persons, firms, and corporations" is not effective to release persons other than the tortfeasor or tortfeasors who specifically contract for the release.

There have been holdings that this specific identification of other tortfeasors is not required by the uniform act for their discharge. These include Battle v. Clanton (1975), 27 N.C. App. 616, 220 S.E.2d 97, followed in White v. American Motors Sales Corp. (W.D. Va. 1982), 550 F. Supp. 1287, 1290 (applying North Carolina law); Liberty v. J.A. Tobin Construction Co. (Mo. App. 1974), 512 S.W.2d 886.

There are convincing reasons, however, against holding that a broadly worded general release, as we have here, will satisfy the conditional language in section 2(c). A purpose of the uniform act was to abrogate the common law rule that the release of one joint tortfeasor releases all joint tortfeasors. (See Unif. Contribution Among Tortfeasors Act, Commissioners' Prefatory Notes, 12 U.L.A. 57, 59-62 (1975).) The common law rule deservedly has been strongly criticized. It has been described as "harsh," "without any rational basis," and "very unfair." (J. Calamari & J. Perillo, Contracts sec. 20-3 (2d ed. 1977).) If literal effect were given to every use of a general release form and "all other persons, firms, and corporations," as appears here, were to be discharged, an important purpose of the Act would be thwarted by the unintended release of persons who were strangers to the release contract. The common law rule released joint tortfeasors by operation of law. By the general release there would be, on the ground of contract, an unwitting discharge of joint tortfeasors.

The legislature intended to abolish the common law rule that produced an involuntary discharge of joint tortfeasors. Section 2(c) states that a release will not operate to "discharge any of the other tortfeasors from liability for the injury * * *." We do not consider that the modifying language that follows, i.e., "unless its terms so provide," should be interpreted to allow the legislative intendment of nullifying the common law rule to be frustrated through the use of what are often general release forms. The legislature surely was aware of the criticism that the common law rule often operated to violate the intentions of persons giving releases. We consider that the legislature's ...


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