THORNTON OPINION MODIFIED ON APRIL 22, 2010
04/27/2010
SET OFF CLAIMS FOR PRIOR SETTLEMENT AMOUNTS DO NOT HAVE TO BE RAISED IN A DEFENDANT'S PLEADING
In its original opinion, the Supreme Court held that the defendant forfeited his set off claim by raising it for the first time in his post-trial motion. The defendant had sought to reduce a judgment against him by the amount of the co-defendants' settlement. The Court reasoned that Section 2-608 of the Code of Civil Procedure (Counterclaims) required a set off claim to be raised as a cross claim in the defendant's answer.
Upon considering defendant's petition for re-hearing, the Court observed that the term "set off" describes two distinct situations: (1) when a defendant claims that the plaintiff has done something that results in a reduction of plaintiff's alleged damages; and (2) when a defendant requests a reduction of a damage award because a third party has already compensated the plaintiff for the injury.
The Court noted that the first type of set off is the procedural equivalent of a counterclaim and that it therefore must be raised in the pleadings. However, the second type of set off constitutes an enforcement action, rather than a counter claim, and is not forfeited if not raised in the pleadings.
Ultimately, the Court held that the trial court properly denied defendant's request for a set off because the defendant failed to offer any proof of what portion of the co-defendants' settlement should be allocated to the judgement.
