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LB 416

Change provisions relating to releases, covenants not to sue, or similar agreements on joint and several liability

109th Legislature (2025-2026) Introduced by George Dungan

Nebraska LB 416 clarifies that a release from one liable party does not erase the joint and several liability of the remaining defendants.

Title printed. Carryover bill
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Bill Summary · LB 416

Summary of Nebraska LB 416 (2025)

Overview

LB 416 proposes to modify how releases, covenants not to sue, or similar agreements affect joint and several liability in civil claims. The bill explicitly aims to reverse a Nebraska Supreme Court interpretation (Tadros v. City of Omaha) that releasing one co-defendant could destroy joint and several liability among remaining defendants. The bill would clarify that such releases do not abrogate the joint and several liability of other liable parties.

  • Introduced: January 17, 2025
  • Primary Sponsor: Senator George Dungan
  • Committee: Judiciary
  • Hearing: Notice of hearing for February 27, 2025 (Date of hearing listed as February 27, 2025)
  • Chairperson: Senator Carolyn Bosn

What the bill does (Key provisions)

The bill would amend Section 25-21,185.11, Reissue Revised Statutes of Nebraska, to read as follows:

1) Release effect on liable parties
- A release, covenant not to sue, or similar agreement entered into by a claimant and a person liable:
- Discharges that released person from all liability to the claimant.
- Shall not discharge any other persons liable on the same claim unless the release provides otherwise.
- The claimant’s claim against other liable persons would be reduced by the released person’s share of the obligation, as determined by the trier of fact.

2) Effect on the released party in court
- The release shall preclude that person from being made a party to the action, or (if an action is pending) shall be a basis for dismissal of that released person.
- However, the released person’s negligence, if any, shall be considered under applicable standards (per § 25-21,185.09).

3) Protection of remaining joint and several liability
- A release entered by the claimant with one or more parties shall not abrogate the joint and several liability of any other person(s) liable on the same claim.

Section 2 repeals and replaces the original § 25-21,185.11 with the revised language.

Who is affected

  • Claimants/plaintiffs who settle with one or more liable parties.
  • Co-defendants and other liable parties remaining in an action.
  • The released party (who is discharged from liability toward the claimant but still interacts with the joint/s settled liability framework).
  • Courts and practitioners handling joint and several liability and allocation of fault.

Procedural and timeline aspects

  • Legislative action history:
    • Introduced: January 17, 2025
    • Referred to Judiciary Committee: January 22, 2025
    • Notice of hearing issued: February 6, 2025
    • Hearing date scheduled: February 27, 2025
  • The bill would repeal the existing text of § 25-21,185.11 and replace it with the revised framework.

Significance and potential impact

  • Policy aim: Align Nebraska law with a more nuanced treatment of releases in multi-party liability scenarios, preserving the integrity of joint and several liability even when a party is released from liability.
  • Practical impact: In settlements, the liability of remaining defendants could be allocated based on the released party’s share, potentially affecting judgments, insurance contributions, and settlement strategies. It also clarifies dismissal and party status implications for released defendants.
  • Context: The bill stems from the Nebraska Supreme Court’s Tadros decision, seeking statutory clarification to ensure joint and several liability remains intact for other liable parties regardless of a release with one party.

Compiled from official sources — confirm details with the bill’s official record.

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