Michael B. Zerres Obtains Reversal of Lower Court Ruling That NJ Malpractice Defendant Was Entitled to Pro Tanto Credit for Out-of-State Settlement Obtained by Plaintiff – Kranz v. Schuss – A-4918-13T1, Decided August 31, 2016

In a recent published Appellate Division decision, Blume Forte partner Michael B. Zerres obtained a reversal of a lower court decision holding that a medical malpractice defendant was entitled to a pro tanto credit for the full amount of an out-of-state settlement the plaintiff had obtained.

In this case, alleging a delay in diagnosing a developmental dysplasia of the hip, plaintiff asserts that the defendant pediatrician, Dr. Steven Schuss of Teaneck, NJ, failed to recognize – between the ages of 1 and 2, the fact that the child had a DDH. It is argued that Dr. Schuss failed to recognize that fact by failing to do proper and adequate hip examinations, which, had they been done would have led to the diagnosis. By the time the hip dysplasia was diagnosed, the hip was completed subluxed – meaning – the hip must have been out of the socket for some time, and, had a proper exam been performed by Dr. Schuss, the abnormality could have been detected. Since the client’s diagnosis was made late, open reduction surgery was required, which will likely lead to her developing premature arthritis of the hip, and, the need for a total hip replacement at an early age. Had the diagnosis been made earlier by Dr. Schuss, the plaintiff could have been treated with a closed reduction, which carries with it a much more favorable long term prognosis.

Prior to the NJ suit, the plaintiff sued her NY pediatricians, who failed to make the same diagnosis between ages 0-1. That case settled.

In the NJ case, the trial Court allowed the NJ doctor (Schuss) to obtain a full pro tanto credit for the NY settlement, without requiring any allocation of fault to the NY doctors by the jury.

Plaintiff appealed the trial Court ruling and the Appellate Division reversed, holding that Dr. Schuss was not entitled to a pro tanto credit for the full amount of the NY settlement. Rather, even though, the NY doctors could not be sued in NJ, they were nonetheless joint-tortfeasors for purposes of the Joint Torteasors Contribution Law. As such, in this case, Dr. Schuss would be chargeable with the total verdict, less than that attributable to the settling defendants’ percentage share, as determined by a jury. Thus, the Court held that the Comparative Negligence Act would require the jury to determine the negligence of the Dr. Schuss and the NY doctors in percentage form.

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