Joint and several liability comes into play in a civil lawsuit in which one party (usually the Plaintiff) is awarded damages from the other party (usually the Defendant). Joint and several liability means that all of the Defendants are responsible for the act, and for the damages. The Plaintiff, however, may seek to collect the awarded damages from all of the Defendants (“joint”), or from some or only one (“several”) if he chooses. If only one Defendant ends up paying, he may seek reimbursement from the other Defendants. To explore this concept, consider the following joint and several liability definition.
Definition of Joint and Several Liability
- The liability or responsibility of one or more parties to pay damages resulting from a tortious act.
Example of Joint and Several Liability
Mike, Bob, and Ethan are playing football in their front yard when they accidentally crash into Mary’s car, denting it and breaking the side mirror. The men argue about who was responsible for the damage, and who should pay, and so refuse to pay for the repairs. Mary takes her case to small claims court, where the judge proclaims the men are joint and severally liable, and awards Mary the sum of $1,500. Because Mary knows Bob is the only one of the three Defendants that has a job, she collects the entire sum from him. If Bob wants to collect from Mike and Ethan for their share, he may need to file a civil lawsuit.
When parties hold joint liability, all parties are liable for the full amount of the obligation in question. For example, if a married couple takes a loan from the bank on a new car, they are jointly liable to repay the full amount. In the event the couple divorces, the debt may be divided between the parties in court. The bank then would have to seek partial reimbursement from each party, and could no longer collect the full amount due from one party.
Several liability, also known as “proportionate liability,” refers to the concept that parties are only liable for their portion of an obligation. Several liability may exist in a contract or other business transaction, in which each party is specifically responsible for his own obligation under the agreement. If one or more of the parties fails to satisfy their obligation, liability for that portion does not fall to the other parties.
Variations on Joint and Several Liability
Most states recognize joint and several liability, but some jurisdictions place limits on it. For example, in Ohio, defendants responsible for more than 50 percent the tortious act can be held liable for a larger share of monetary damages. The defendant who caused less than half of the problem is only responsible for a portion of the victim’s loss. This is referred to as “comparative responsibility.”
Joint and Several Liability vs. Comparative Responsibility
Unlike joint and several liability, where all defendants are typically responsible for the entire amount of the damages, comparative responsibility is the practice of comparing the fault of each party in a lawsuit, including the plaintiff, to determine the amount for which each one is responsible. For example, if Sally files a lawsuit against Robert for damaging her car in a parking lot accident, and she is found 25 percent at fault for the accident, she would likely be awarded a sum equal to only 75 percent of the amount needed to fix her car.
In Alabama, if a plaintiff is partially responsible, he is not able to recover any of the damages. This is the only state with this restriction. Other states however, have specific restrictions on how the damages are divided and the percentage that can be awarded.
Joint Liability in Microfinance
In the world of finance, the concept of “microfinancing” is sometimes used to address lending to groups of individuals in poverty-stricken areas. In this case, each member of the group is liable to the others, and responsible for ensuring everyone pays their portion. If one member of the group is unable to pay his portion, all of the members are held in default. This practice solves the problems of obtaining information and enforcing repayment of loans that would otherwise not be made.
Related Legal Terms and Issues
- Tortious Act – a civil wrong that causes a person to suffer loss or harm. The civil wrong results in civil liability, such as breach of contract.
- Plaintiff – a person or entity who brings a civil or criminal lawsuit against another person or entity.
- Defendant – a person accused of a crime in criminal court, or a person or entity being sued by another party in a civil lawsuit.
- Default – failure to fulfill an obligation such as repaying a loan.
- Monetary Damages – compensation awarded to a victim or plaintiff, to be paid by a party liable for the injuries or losses.
- Restitution – repayment made to a person for their loss or injury.