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Pierringer Orders

. Endean v. St. Joseph's General Hospital

In Endean v. St. Joseph's General Hospital (Ont CA, 2019) the Court of Appeal considers Pierringer orders:
[52] This brings us to the Pierringer Order in the Hearsey Action. Named after Pierringer v. Hoger, 124 N.W. 2d 106, 21 Wis. 2d 182 (U.S. Wis. S.C. 1963), the purpose of a Pierringer Order is to facilitate a settlement between a plaintiff and a defendant who wishes to settle (a settling defendant), while maintaining a level playing field for the remaining (non-settling) defendant against whom the plaintiff wishes to proceed to trial: see Sable Offshore Energy Inc. v. Ameron International Corp., 2013 SCC 37, [2013] 2 S.C.R. 623, at paras. 6, 23-26. It does this by certain essential provisions:
(1) The settling defendant settles with the plaintiff;

(2) The plaintiff discontinues its claim [against] the settling defendant;

(3) The plaintiff continues its action against the non-settling [defendant] but limits its claim to the non-settling defendant's several liability (a 'bar order');

(4) The settling defendant agrees to co-operate with the plaintiff by making documents and witnesses available for the action against the non-settling defendant;

(5) The settling defendant agrees not to seek contribution and indemnity from the non-settling defendant; and

(6) The plaintiff agrees to indemnify the settling defendant against any claims over by the non-settling defendants.

Handley Estate v. DTE Industries Limited, 2018 ONCA 324, 421 D.L.R. (4th) 636, at para. 39, citing Paul M. Perell & John W. Morden, The Law of Civil Procedure in Ontario, 3d ed. (Toronto: LexisNexis Canada, 2017), at p. 762.
[53] These essential provisions of a Pierringer Order are informed by the discussion of liability above. The non-settling defendant will have cross-claimed against a settling defendant because it wants to recover the settling defendant’s share of fault from it as indemnity, should the non-settling defendant have to pay more than its proportionate share of the plaintiff’s damages. The non-settling defendant’s need to do so disappears under a Pierringer Order, because it requires the plaintiff to effectively put the non-settling defendant in the same economic position as if it paid the plaintiff in full and recovered any indemnity from the settling defendant. It does this by requiring the plaintiff to reduce its recovery from the non-settling defendant by the percentage of fault to be attributed to the settling defendant, and thus by the amount the non-settling defendant would have been able to recover from the settling defendant as indemnity: see M.(J.) v. Bradley (2004), 2004 CanLII 8541 (ON CA), 71 O.R. (3d) 171, 187 O.A.C. 201 (C.A.), at paras. 30-31.

[54] To use an example, suppose defendants A and B were each creditworthy and cross-claimed against each other for indemnity. Suppose each is found liable at trial and fault was apportioned 50% to each. The plaintiff makes A pay 100% of the damages. But A recovers from B, on a cross-claim, for B’s 50% proportionate liability as indemnity. At the end of the day, A’s net payment is only 50%, commensurate with A’s liability. [55] Now suppose the plaintiff settled with B before trial. In the Pierringer Order situation, the plaintiff reduces their recovery from A (who did not settle) by the amount it is determined that B is at fault. At trial, A and B are each found to be 50% at fault. The plaintiff reduces their claim against A by the amount of fault attributed to B. A’s net payment is the same 50%.


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