RABINOWITZ, Chief Justice.
This petition for review raises questions of first impression concerning Alaska's
I. Factual and Statutory Background
These wrongful death and tort actions originally involved three defendants: Slicer Corporation ("Slicer"), Richard Pears, and Tommy's Elbow Room ("Tommy's") Plaintiffs (collectively "the Kavorkians") settled with Slicer and Pears. Slicer agreed to pay the Kavorkians $538,225 in exchange for a release from any liability for the underlying accident. Pears agreed to the entry of a consent judgment in favor of the Kavorkians in the amount of $1,230,000. This agreement did not contemplate that Pears would pay the Kavorkians this amount; rather, Pears assigned to the Kavorkians his rights against his insurer, Leader National Insurance Company ("Leader National"). In turn, the Kavorkians agreed not to execute against any of Pears' assets except the rights assigned against Leader National.
Tommy's filed a motion in superior court requesting "an order establishing, as a matter of law, the amounts received by plaintiffs in settlement money and to reduce plaintiffs' claim against [Tommy's] for such amounts." Pursuant to AS 09.16.040(1), the superior court ordered the reduction of the Kavorkians' claims against Tommy's by the amount of the Slicer settlement plus "the amount obtained from the good faith prosecution of the action against Leader National."
Subsequent to entry of the superior court's order, we granted Tommy's petition for review to determine whether the superior court erred in refusing to reduce the Kavorkians' claims by the total amount of the settlement agreements made with Slicer and Pears pursuant to Alaska's Uniform Contribution Among Tortfeasors Act, AS 09.16.040(1).
II. Construction of AS 09.16.040
The question of whether the superior court erred in refusing to reduce the Kavorkians' claims against Tommy's by the face amount of their settlement with Pears requires interpretation of AS 09.16.040(1).
The text of AS 09.16.040
Tommy's argues that the Kavorkians' eventual recovery on the assigned claim is irrelevant because the face amount of the consent judgment represents the "amount stipulated" within the meaning of AS 09.16.040(1) and accordingly is the amount by which the various claims of the Kavorkians should be reduced.
Tommy's argues to the contrary that the "amount stipulated by the release or the covenant" means the face amount of the consent judgment. In Tommy's view the text of AS 09.16.040 is "unambiguous." Tommy's further argues that the Kavorkians should be bound by their bargain since the agreement to the consent judgment, the covenant not to execute, and the assignment of rights comprise a freely negotiated contractual arrangement between Pears and the Kavorkians. The assignment to the Kavorkians of Pears' claim against Leader National gave the Kavorkians an incentive to set the consent judgment amount high, gambling that the jury would find it reasonable and thus enforceable against Leader National. The trade-off for this decision was the reduction of the Kavorkians' claim against Tommy's by that amount. If in hindsight the Kavorkians now are of the view that they unwisely chose to rely on the expectation of a large recovery from Leader National, that should not relieve them from the legal consequence which section .040(1) attaches to the "amount stipulated by the ... covenant" the Kavorkians entered into with Pears. We thus agree with the arguments advanced by Tommy's.
Our primary interpretative guide is the language of the statute itself, construed in light of the purpose of its enactment. J & L Diversified Enterprises v. Municipality of Anchorage, 736 P.2d 349, 351 (Alaska 1987); Commercial Fisheries Entry Comm'n v. Apokedak, 680 P.2d 486, 489-90 (Alaska 1984); Wien Air Alaska v. Arant, 592 P.2d 352, 356 (Alaska 1979). "If the meaning of a statute is plain it should be enforced without judicial modification or construction." Horowitz v. Alaska Bar Ass'n, 609 P.2d 39, 41 (Alaska 1980).
Alaska Statute 09.16.040(1) states in part that any release or covenant not to sue or not to enforce judgment "does not discharge
(Footnotes omitted.) The Act also retained "that part of the common law rule embodying the sound public policy of permitting a plaintiff to receive only the amount of his adjudged damages and no more, regardless of the source of the recovery." Layne v. United States, 460 F.2d 409, 411 (9th Cir.1972); Perlmutter v. Blessing, 706 P.2d 772, 775 (Colo. 1985); AS 09.16.040. This policy is given effect by the provision of AS 09.16.040(1) that the claims against the remaining tortfeasors will be reduced by "any amount stipulated by the release or the covenant, or in the amount of the consideration paid for it, whichever is greater."
In conclusion, we hold that the provisions of AS 09.16.040(1) are unambiguous and
REVERSED and REMANDED for further proceedings consistent with this opinion.
Thus, under the 1939 Act, the settling tortfeasor was motivated to set a greater amount on the release than the consideration paid, as high an amount as possible, because that amount would reduce the plaintiff's remaining claims and consequently the judgment by which his contribution liability was determined. See generally Martinez v. Lopez, 300 Md. 91, 476 A.2d 197, 202 (1984). Amended in 1955 to reverse the tendency to discourage settlements by discharging the settling tortfeasor outright from all contribution liability, 12 U.L.A., supra, at 100, the Act now gives the settling tortfeasor no incentive to set the release amount higher than the consideration paid. Absent an external influence such as the insurance claim here, the plaintiff similarly has no incentive to stipulate an amount greater than the consideration paid for the release, since its claim against the other tortfeasors is reduced by the greater of the two figures.
Illustrative of these policy considerations are the following examples: A is an injured plaintiff. B and C are joint tortfeasors. A settles with B for $25,000. After trial A's damages against C are fixed at $200,000. Under the Act A obtains judgment against C in the amount of $175,000. C in turn has no right of contribution against B. Thus C ends up liable for his pro rata share of the common liability ($100,000 of $200,000) plus an additional $75,000 which represents that portion of the settling tortfeasor's pro rata share of the common liability which is greater than the amount stipulated (or received) in the settlement which was entered into between A and B.
Again, A is an injured plaintiff. B and C are joint tortfeasors. A settles with B for $175,000 and after trial his damages against C are fixed at $200,000. Under the Act A obtains judgment against C in the amount of $25,000. C in turn has no right of contribution against B. Here C is liable to A for less than his pro rata share of the $200,000 common liability.
Wholly apart from the fact that this point was not decided by the superior court, it becomes clear from reading this section in context that it does not have the effect asserted by the Kavorkians. As Tommy's points out, section .030 governs enforcement of contribution rights among tortfeasors. Moreover, it has been expressly held that this section does not apply to settlements, see Wade v. Baybarz, 660 S.W.2d 493 (Tenn. App. 1983), and the commentary suggests that the section was originally "thought to be necessary out of considerations of consistency, in view of the changes made in connection with the releases in [section 4]." Unif. Contribution Among Tortfeasors Act § 3, Commissioners' Note, 9 U.L.A. 241 (1957). Section .030 was retained in the revised Contribution Act as simply a statement of "the well established rule that the injured party in obtaining judgment against one joint tortfeasor does not thereby discharge the others, although there may, of course, be but one satisfaction of the claim." 12 U.L.A., supra, at 90.
If this section were applied in this case, it would create a result totally at odds with section .040(1): instead of reducing the Kavorkians' claims against Tommy's, section .030(e) would fully discharge Tommy's upon "satisfaction" of the judgment against Pears. (That satisfaction might be deemed to be either the assignment of Pears' rights itself or the payment of any judgment by Leader National.) This discharge would happen automatically, again contrary to section .040(1), which permits such discharge only if the terms of the release so provide. Given the accepted principle of statutory construction that provisions of the same act should, where possible, be interpreted to be consistent rather than conflicting, see generally 2A N. Singer, Sutherland Statutory Construction § 46.04 (4th rev. ed. 1984), the Kavorkians' argument here is without merit.