Marton v. Ater Construction Co., LLC

A party who enters into a settlement with a claimant is not entitled to recover contribution or indemnity from a third-party whose liability is not extinguished by the settlement.

Ater appealed the trial court’s summary judgment ruling for Marvin and Medallion. Marton filed suit against Ater, the builder of their home. Ater then filed a third-party complaint against Marvin and Medallion. Ater and Marton settled. Following the settlement, Marvin and Medallion moved for summary judgment on their third-party claims and argued that Ater’s claims for contribution and indemnity fail as a matter of law because the settlement only extinguished Ater’s liability. They also argued that Ater’s negligence claim was barred by the economic loss doctrine. Ater argued that a third-party plaintiff is not required to obtain an extinguishment of claims against joint tortfeasors for contribution and indemnity claims and that the negligence claim was based on property damage, not purely economic loss. The Court agreed with Marvin and Medallion with regard to the contribution, indemnity, and negligence claims. The Court held that in order for the contribution or indemnity claim to survive, the settlement would have had to extinguish the liability of Marvin and Medallion, and the trial court held it did not. Ater’s negligence claim also failed because Ater sought to recover damages Ater incurred itself, not damages that the Marton’s suffered in relation to their property. Affirmed.