Effective July 1, 2013, if multiple defendants are found liable in a civil action governed by comparative fault, each defendant is only liable for the percentage of fault allocated. No defendant will be held jointly liable for any damages; however, the doctrine of joint and several liability will still apply in civil conspiracy cases and in product liability actions based on strict liability and breach of warranty (among manufacturers).
Suit against a UM carrier in Tennessee can be complicated. In Liput v. Grinder, 38 TAM 24-5 (2/27/2013), the plaintiff was injured while walking in a parking lot on November 10, 2009, when he was struck by a car operated by the tortfeasor. On July 14, 2010, the tortfeasor died of unrelated causes. Just prior to the one year anniversary of the incident, the plaintiff filed suit, and attempted service on the deceased tortfeasor. The tortfeasor was obviously not served with the lawsuit. The UM insurer was served and filed an Answer. Thereafter, the plaintiff apparently learned of the tortfeasor’s death and filed a suggestion of death on March 31, 2011. After filing the suggestion of death, nothing happened until the UM insurer filed a motion for summary judgment on November 18, 2011. The trial court ruled in favor of the UM insurer because a law suit was never properly commenced against the proper defendant.
The reviewing court upheld the trial court’s dismissal of the case.
After outlining the facts of the case, the Court discussed TCA 20-5-103, which tolls the statute of limitation for the period of time between the death of the tortfeasor and appointment of the representative of the estate, up to 6 months. The plaintiff did not serve a personal representative, and it is unknown if one actually existed.
Interestingly, the UM statute seemingly almost allowed the plaintiff’s cause of action to survive. A direct action is permitted against a UM carrier where a return of summons states the defendant is “not to be found.” For whatever reason, in this case, the summons was never returned to the Clerk of Court. Whether or not the Court would have allowed the case to proceed as a direct action against the UM carrier if the return of summons had been filed with the Clerk is unknown; though the Court seems to give the argument a fair amount of weight.
And finally, the Court rejected the plaintiff’s contention that the UM insurer waived its argument with regard to service by failing to raise the defect as an affirmative defense. The Court noted that other cases have not imposed such a requirement; and further noted that there was no evidence to suggest that the UM carrier knew of the tortfeasor’s death.
The harsh result reached in this case is unfortunate considering the facts.
Interestingly, the tortfeasor’s liability insurer settled the case for policy limits with the plaintiff about 3 weeks after the insured had died, but prior to the plaintiff filing the lawsuit. Under the Tennessee UM statute, such a settlement would require the UM carrier to either allow the settlement and proceed to arbitration, or front the money to preserve the right to a jury trial. I can’t help but think that the UM statute was not complied with in this case. If there was compliance with the UM statute, it’s hard to imagine practically and legally how the UM carrier would have been able to get the case dismissed.
In Ferguson v. Middle Tennessee State University, 38 TAM 24-4 (3/28/2013), the reviewing court reversed a $3 million jury verdict in favor of the plaintiff on a retaliatory discharge claim, holding that “general corporate knowledge” is not sufficient for a claim of retaliation for engaging in protected activity. The Court held that a plaintiff in a retaliation claim is required to show that the individual who took the adverse job action against the plaintiff had knowledge of the plaintiff’s protected activity at the time of the adverse employment decision.
Here is the big one – for injuries on-the-job covered under Georgia workers’ compensation and occurring July 1st or after, lifetime medical is no longer available, unless the injury is catastrophic. For most injuries, medical care will only have to be provided by the employer and their insurer for 400 weeks from the date of injury (This is slightly less than eight years). This is a major change that will impact people who have suffered back, neck and other spinal injuries, people suffering from chronic pain, people who need pain management, and people who need to have orthopedic hardware removed or joint replacements redone years after the original surgery. For catastrophic injuries, however, the employer/insurer must continue to provide such medical treatments as “reasonably required and appear likely to effect a cure, give relief, or restore the employee to suitable employment,” without any time limitations, O.C.G.A. § 34-9-200.
There are only two changes in the law coming up that will actually benefit working people. One is an incremental change in the maximum workers’ compensation rate – it will increase from $500/week to $525/week for accidents occurring July 1st or after. The maximum temporary partial disability rate will also incrementally increase from $334/week to $350/week. Georgia’s maximum workers’ compensation rate was already low so this change does little to improve an abysmally inadequate benefit structure. The other change is a requirement that the insurer reimburse employees for medical travel expense (mileage) within 15 days after receipt of the documentation instead of 30 days.
When an employee returns to work with restrictions, he or she has been given a grace period of 15 days to try the job and see if he or she can actually do the job, to see if it is really light duty, and to see if it is really what it was represented to be, O.C.G.A. § 34-9-264. The new law amended this Code section to require that the employee try the light duty job for at least eight cumulative hours or one scheduled workday, whichever is greater, before taking advantage of the 15 day grace period. The 15 day grace period requires disability benefits to be immediately reinstated if the employee is unable to perform the job for more than 15 days. So he or she must try the job for at least eight cumulative hours or one scheduled workday or he/she will not entitled to automatic reinstatement of TTD benefits. This is only a minor procedural change, and our law firm has always encouraged clients to try a light duty job for several days and to seek medical advice before walking away from a light duty job.
To read the entire law, as passed by the Georgia legislature, see HB154.
O.C.G.A. § 51-12-33 (d) (1) states that the “negligence or fault of a nonparty shall be considered if the plaintiff entered into a settlement agreement with the nonparty.” The statute does not address whether the amount of any settlement is admissible or whether the remaining defendants get any credit for settlement funds paid by a settling nonparty. Prior to the 2005 “tort reform” bill, which amended O.C.G.A. § 51-12-33, adopted apportionment of damages in all tort cases and abolished joint and several liability, it was the law in Georgia that, “[a] plaintiff is entitled to a full, but single, satisfaction of his total harm. Consequently, where one or more tortfeasors enter a settlement with a plaintiff, a remaining tortfeasor may be entitled to a set off of payments previously made, to prevent double recovery,” Brewer v. Insight Tech., Inc., 301 Ga. App. 694, 700-701 (2009).
It is extremely doubtful whether this long-standing principal of law in Georgia has survived the “tort reform” legislation. Surprisingly, there has been no appellate decision yet directly overruling this line of cases. The Court of Appeals came close, however, in Union Carbide Corp. v. Fields, 315 Ga. App. 554 (2012), where one of the issues was whether the defendant had to produce evidence of negligence and causation on the part of a nonparty before the jury can even consider apportioning fault to that nonparty under O.C.G.A. § 51-12-33(d)(1). The Court held that:
“ . . . the fault of a nonparty cannot be considered for the purposes of apportioning damages without some competent evidence that the nonparty in fact ‘contributed to the alleged injury or damages’” (Emphasis supplied) 315 Ga. App. at 559.
“Thus, under this State’s statutory scheme, the effect of a successful nonparty defense is the reduction of the plaintiff’s potential award and the defendant’s possible liability. As with other affirmative defenses, Defendants have the burden at trial to prove the defense of nonparty fault. Cf. Hodge v. SADA Enterprises, 217 Ga. App. 688, 691 (2) (458 SE2d 876) (1995) (indicating that a defendant has the burden at trial to prove affirmative defenses of contributory and comparative negligence).” 315 Ga. App. at 556.
Then the Court considered whether defendants who settled with the plaintiff before trial should automatically be included on the verdict form for purposes of apportioning fault, and concluded that:
“ . . . when OCGA § 51-12-33 (d) (1) is read together with OCGA § 51-12-33 (c), a defending party still must show that a settled entity “contributed to the alleged injury or damages” before its fault can be assessed by a trier of fact. Otherwise, there would be no basis for the apportionment of fault between the settled entity and the defendant. See McReynolds v. Krebs, 307 Ga. App. 330, 334 (1), 335 (3) (705 SE2d 214) (2010) (rejecting defendant’s contention that trier of fact should have apportioned damages between her and a settled party where the defendant presented no evidence on which apportionment of liability could be based and thus waived any issue with regard to the verdict form). We therefore decline to interpret OCGA § 51-12-33 (d) (1) as requiring a trier of fact to automatically consider the potential fault of a settled entity.” 315 Ga. at 558-559.
Under the statutory scheme created by OCGA § 51-12-33, and following the logic of Union Carbide Corp., neither fact of settlement nor the amount of any settlement should be admissible at trial in Georgia, nor should the remaining defendant or defendants get any credit for settlement money the plaintiff was fortunate enough to obtain from a settling nonparty prior to trial.
Trial lawyers in Tennessee have now had over twenty years of experience with allocation of fault and the resulting apportionment of damages in tort cases since McIntyre v. Balentine, 833 S.W.2d 52 (1992). The lessons learned can be helpful to in Georgia where the courts are struggling with interpretation and implementation of O.C.G.A. § 51-12-33, which was radically amended in 2005. It has taken years for the Tennessee appellate courts to work through the plethora of issues raised by allocation of fault, and it will take years for Georgia courts to do likewise.
Hubert Hamilton recently presented a paper on apportionment of damages under O.C.G.A. § 51-12-33 at the Georgia Trial Lawyers Annual Convention and Seminar, in Atlanta, during the trucking session on May 17, 2013, entitled Apportionment of Damages – The Good, the Bad and the Ugly (A Conversation with an Empty Chair).
The major problem faced in Georgia is the lack of any equivalent to T.C.A. § 20-1-119 which allows a plaintiff 90 days to either amend and add to the lawsuit a nonparty alleged to have been at fault, or to institute a separate lawsuit against such person, even if the statute of limitations has run, after the defendant “alleges in an answer or amended answer to the original or amended complaint that a person not a party to the suit caused or contributed to the injury or damage for which the plaintiff seeks recovery”
In cases filed in Georgia, however, “negligence or fault of a nonparty shall be considered if the plaintiff entered into a settlement agreement with the nonparty or if a defending party gives notice not later than 120 days prior to the date of trial that a nonparty was wholly or partially at fault,” O.C.G.A. § 51-12-33(d) (1), even if the statute of limitations has run, and there is no provision in the statute for adding the nonparty to the lawsuit.
This presents plaintiffs and their attorneys with a number of problems, particularly if suit is not filed early enough to identify any nonparties alleged to be at fault before the statute of limitations runs. Then decisions have to be made as to whether to add such nonparties to the lawsuit (or to file a separate lawsuit). Discovery must be pursued aggressively. Scheduling orders can help, as well as motions for summary judgment seeking to eliminate allocation of fault to nonparties for which there is no competent evidence of fault. See Union Carbide Corp. v. Fields, 315 Ga. App. 554, 559 (2012), where the Court held that:
“ . . . the fault of a nonparty cannot be considered for the purposes of apportioning damages without some competent evidence that the nonparty in fact ‘contributed to the alleged injury or damages’”
The jury must be told that if they find the plaintiff 50% or more at fault, the plaintiff will recover nothing, Bailey v. Annistown Road Baptist Church, 301 Ga. App. 677 (2009). Fault be allocated to a nonparty who is immune from suit, Barnett v. Farmer, 308 Ga. App. 358 (2011). An admission against interest is admissible to prove nonparty fault, Woods v. Allied Van Lines, Inc., 316 Ga. App. 548 (2012). But O.C.G.A. § 51-12-33 does not affect vicarious liability situations, PN Express, Inc. v. Zegel, 304 Ga. App. 672 (2010).
We are honored to have been listed in the Bar Register of Preeminent Lawyers by Martindale-Hubbell for the last few years based upon peer review ratings. We have also received the Client Distinction Award for the last three years. Less than 1% of the more than 900,000 attorneys listed on martindale.com and lawyers.com have been awarded this honor.
U.S. Airways, Inc. v McCutchen, ____ U.S. ____ (4/16/13) holds that in an ERISA action under §502(a)(3) by the plan administrators to obtain “appropriate equitable relief . . . to enforce . . . the terms of the plan,” the plan’s terms govern and override any doctrines designed to prevent unjust enrichment. The plan paid $66,866 in medical expenses to McCutchen due to a car wreck. A settlement of $110,000 was reached and McCutchen received $66,000 after attorneys’ fees were deducted. The plan sued and demanded reimbursement of the entire $66,866 it had paid on McCutchen’s behalf. The Supreme Court held that the plan could obtain the funds its beneficiary had promised to turn over under the terms of the plan. However, the Court also held that while equitable rules would not trump a reimbursement provision in the ERISA plan, they may aid in properly construing it, and as to allocation of attorneys’ fees this particular plan was silent. This plan did not address cost of recovery, so the Court applied the common fund doctrine, which governs in the absence of a contrary agreement. The Court pointed out that without the common fund rule, the insurer would get a free ride on the beneficiary’s efforts, and the beneficiary, as in this case, could be made worse off by having procured a recovery from a third party. This decision leave the door open for appropriate allocation of attorneys’ fees and litigation costs when an ERISA plan seeks reimbursement from its beneficiary, but it does little to benefit the injured beneficiary.
A new Code Section, O.C.G.A. § 9-11-67.1, provides a minimum of 30 days for a defendant (or his liability insurance company) to respond to a settlement offer made before suit is filed, in case arising from the use of a motor vehicle. The new law allow the insurance adjuster “to seek clarification regarding terms, liens, subrogation claims, standing to release claims, medical bills, medical records, and other relevant facts,” without that being deemed a counteroffer. The demand should be sent by “certified mail or statutory overnight delivery, return receipt requested” and shall specifically reference the new Code section. This statute was meant to give insurance companies adequate but not unreasonable time to respond to a settlement demand without being subjected to a subsequent bad faith claim for failing to settle the case within policy limits.
For years the Tennessee appellate courts have been notoriously biased in favor of insurance companies, particularly Tennessee Farmers Mutual. Finally, however, the Court of Appeals has let a jury take a big stick to their favorite son.
In Leverette v. Tennessee Farmers Mutual, 2013 Tenn. App. LEXIS 177 (March 4, 2013), a woman was severely injured in a wreck on 12/21/08 with an automobile driven by an unlicensed minor. The child’s parents’ were insured by Tennessee Farmers (TFM), and it denied coverage and refused to defend the suit on the basis of an exclusion in the insurance policy “for damages caused by a party driving without permission of the owner or a person “in lawful possession” of the vehicle.” No defense was offered, and the injured woman obtained a $1 million default judgment against the minor driver. The injured woman and the child’s parents then jointly filed suit against TFM for breach of contract, bad faith, violation of the Tennessee Consumer Protection Act (TCPA), and violation of the Unfair Claims Practices Act. The trial court ruled that, as a matter of law, the minor was entitled to insurance coverage under her parents’ policy at the time of the accident. The rest of the case was submitted to a jury, who found that TFM had violated T.C.A. § 47-18-104 (27) and awarded $1,000,000 in damages. The trial court trebled the compensatory damages and awarded attorney fees under TCPA. The jury also awarded compensatory and punitive damages on the “bad faith claim.”
The Court of Appeals did not sustain the verdict on the bad faith claim under the circumstances, as the plaintiff did not plead a violation of T.C.A. § 56-7-105, but rather relied on a common law tort of bad faith, which the Court said is not recognized in Tennessee in lawsuits between the insured and insurer.
As to TCPA, however, the jury was asked, “Do you find that the Defendant committed an unfair or deceptive act or practice under the Tennessee Consumer Protection Law that caused damage to Chad and Donna Sanders parents and guardians for Julia Claire Sanders, or Chad and Donna Sanders in their individual capacity?” The jury answered the question in the affirmative.
Although the Court of Appeals let TFM off the hook for treble damages under TCPA, the Court clearly held that TFM was subject to liability, given the finding by the jury that TFM had committed “an unfair or deceptive act or practice”:
“We affirm the verdict and judgment holding that TFM had committed unfair or deceptive act or practice under TCPA causing damages to Sanders. The trial court’s award of $1,000,000 in compensatory damages is affirmed.”
Unfortunately the Legislature, in 2011, moved in to protect the insurance industry and amended T.C.A. § 47-18-104 (27) to vest enforcement with the goverment in lieu of the citizens who have been wronged. The Code section now provides:
“Engaging in any other act or practice which is deceptive to the consumer or to any other person; provided, however, that enforcement of this subdivision (b)(27) is vested exclusively in the office of the attorney general and reporter and the director of the division.”