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Superior Court Of Pennsylvania Nullifies Reservation of Rights Clause Contained In Release Signed By Appellant

The Superior Court of Pennsylvania overturned an order for summary judgment on appeal to the extent that it nullified a reservation of rights clause contained in a release signed by appellant. In Maloney v. Prendergrast, appellant's suit centered primarily on the treating physician negligently failing to disclose a lesion on the right scapula of the appellant's decedent from a 1988 x-ray. Appellant executed a joint tortfeasor release with appellees which provided that, in acceptance of an amount of money paid, appellant released appellees from further liability. However, there was a provision regarding the treating physician that reduced his liability based on a pro rata share of legal responsibility or legal liability for which each appellee was found to be liable. Appellees filed for summary judgment asserting that the language of the release operated to insulate them from liability so that all claims against them should be dismissed. The trial court agreed. On appeal, appellant asserted that a reservation of rights provision in the release only discharged the medical facilities from direct liability while preserving issues of vicarious liability against them and that the treating physician was not so insulated.

The court followed the Uniform Contribution Among Tortfeasors ACT (UCATA), 42 Pa.C.S.A § 8326 contract law principles in finding in favor of appellants. Section 8326 of the Act provides that discharge of one joint tortfeasor does not operate to discharge the other(s) unless so specified in the release. The words of the release specifically and comprehensively effectuate the discharge of all listed health care providers save the treating physician by encompassing any and all acts capable of incurring either direct or indirect liability which extinguished all of appellant’s claims against appellees other than that of the treating physician.

The law pertaining to releases is well settled: "it is axiomatic that releases are construed in accordance with traditional principles of contract law, fundamental to which is the directive that, 'the effect of a release must be determined from the ordinary meaning of its language.'" Clark v. Philadelphia College of Osteopathic Medicine, 693 A.2d 202, 207 (Pa. Super. 1997), appeal dismissed as improvidently granted, 557 Pa. 487, 734 A.2d 859 (Pa. 1999) [**7] (citing Buttermore v. Aliquippa Hosp., 522 Pa. 325, 561 A.2d 733, 735 (Pa. 1989)). Moreover, Pennsylvania contract law prescribes that, "an interpretation will not be given to one part of the contract which will annul another part of it." Capek v. Devito, 564 Pa. 267, 767 A.2d 1047, 1050 (Pa. 2001). Further, Pennsylvania contract law, recognizing that the intention of the parties is paramount in any interpretive effort, explains that the court should adopt a construction "which under all circumstances ascribes the most reasonable, probable, and natural conduct of the parties, bearing in mind the objects manifestly to be accomplished." Tuscarora Wayne Mutual Ins. Co. v. Kadlubosky, 2005 PA Super 402, 889 A.2d 557, 563 (Pa. Super. 2005).

Here, the trial court's interpretation not only annuls a major portion of the Release, but ignores the express objective of the settlement, that is, to limit further litigation while not forestalling it completely. Accordingly, the court vacated the summary judgment order and remanded for further proceedings consistent with the court’s opinion.

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