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Georgia Supreme Court Decisions on Tort Reform - Sterling Risk Advisors - Insurance Brokerage, Risk Management

Georgia Supreme Court Decisions on Tort Reform

Below is a concise overview of the three recent Georgia Supreme Court decisions regarding the 2005 Tort Reform Act. The first two of these decisions upheld the provisions of the Act and the third did not.

Georgia Supreme Court Decisions on Tort Reform

Emergency Room Gross Negligence Standard Affirmed - Gliemmo vs. Cousineau -This was a 2007 Muscogee County case alleging malpractice against an Emergency Room Physician. The plaintiff alleged that one evening she felt a sudden “snapping in her head..” Her husband called an ambulance, which took her to a Columbus hospital where she was treated in the emergency room. The Emergency Room physician (defendant) diagnosed her with “hypertensive urgency,” or greatly increased blood pressure. The family later claimed the physician attributed her headache to “stress” and high blood pressure, prescribed Valium and sent her home. The hospital and physician claimed they gave her a beta-blocker to treat the high blood pressure and performed an EKG and blood tests. After her blood pressure went down and she told nurses she felt “much better,” they released her. Two days later, her family practitioner ordered a CT scan, which revealed a brain hemorrhage that had left her paralyzed.

The 2005 Tort Reform Act instituted a rule which demands evidence of “gross negligence” on the part of Emergency Rooom physician in order to sustain a medical malpractice claim. The plaintiff’s attorneys argued the alleged mistakes constituted gross negligence but also challenged the constitutionality of the ER statute on a number of grounds. The crux of the arguments heard by the Georgia Supreme Court centered on whether this rule constituted a “special law” which the state Constitution prohibits. In the 4-3 decision upholding the Tort Reform Act, Justice Carley wrote for the majority that the ER rule gross negligence provision isn’t a “special law” because it doesn’t just apply only to a limited activity in a specific industry during a limited time frame. He stated the rule “operates uniformly upon all healthcare liability claims arising from emergency medical care.”

Offer of Settlement Statute AffirmedSmith vs. Baptiste -This case began when the wife of a former Atlanta Falcons player took their 11-year-old daughter to have her hair chemically relaxed at a hair and nail salon. The next week, the salon owner learned that the former Falcon had made disparaging remarks on a TV sports broadcast about her and her salon. A suit was filed and the court ruled in favor of the former Falcon dismissing the suit.

While the salon owner’s appeal was pending, the former Falcon filed a motion asking the court to require the salon to pay for his legal fees, based on the “offer of settlement” statute that was part of the 2005 Tort Reform. Under the statute, if a plaintiff is presented an offer to settle which they refuse and they ultimately lose the case (or they win but the judgment is less than 75% of the defendant’s offer) the plaintiff has to pay the defendant’s attorneys fees. In response, the salon owner argued that the statute is unconstitutional and denies poor people the right of access to the courts even when they have a legitimate cause of action. The trial court ruled in the salon owner’s favor and found that the “offer of settlement” statute was unconstitutional.

This decision was appealed to the GA Supreme Court which reversed the decision. In the 5-2 decision, Justice Carley wrote that the Constitution states that “no person shall be deprived of the right to prosecute or defend, either in person or by an attorney, that person’s own cause in any of the courts of this state.” He further explained that this constitutional provision “was never intended to provide a right of access to the courts, but was intended to provide only a right of choice between self-representation and representation by counsel.” Carley wrote, "The clear purpose of the Tort Reform law is to encourage litigants in tort cases to make and accept good faith settlement proposals in order to avoid unnecessary litigation.” This decision upholds a portion of the Tort Reform law that has led to a significant decrease in the frequency of malpractice cases brought in Georgia which in turn has lowered premiums.

$350K Non-economic Damages Cap Ruled Unconstitutional – Nestlehutt vs. Atlanta Oculoplastic Surgery – This was a case against a plastic surgeon brought by a 71 year old patient who underwent a face-lift combined with carbon dioxide laser resurfacing. Initially, the patient’s healing seemed normal, but she soon developed a rash, followed by open wounds on her cheeks and temples. Eventually the wounds healed, but she was left with permanent scarring. The patient sued alleging that the Plastic Surgeon had been negligent and was awarded a verdict of $1,265,000. This award exceeded the maximum allowed under the 2005 Tort Reform Act, which established limits on the amount of “noneconomic damages” that could be recovered. Such damages do not include medical expenses, or past and future earnings, but do include compensation for “pain and suffering.” Under the law, the most one could get was $350,000 for claims against one or more medical practitioners. Following the initial verdict, which exceeded the total allowed under the law, the patient filed a motion to declare the state law unconstitutional. In this unanimous decision of the Georgia Supreme Court, Justice Hunstein wrote, “In sum, …we conclude that the noneconomic damages cap violates the right to a jury trial as guaranteed under the Georgia Constitution.” The ruling further said that the right of a jury trial includes the jury being able to determine the economic amount of the award. As such there is no longer a cap on the amount of non-economic damages that may be awarded in a medical malpractice case.

We cannot predict if or when malpractice premiums will increase due to the above decision by the GA Supreme Court. The renewal premium pricing we have received from the malpractice carriers since this decision was handed down has remained stable and it may be that underwriters are taking a “wait and see” approach for the present. If there is upward pressure on rates, be assured that we will keep your practice’s premiums at the most competitive and lowest level possible at each future renewal. We write more physician malpractice insurance than any other firm in Georgia and are the only firm that represents all of the standard and non-standard malpractice carriers currently writing in this marketplace. Our standard carriers include Anesthesiologists Professional Assurance Company (APAC), The Doctors Company, First Professionals Ins. Co. (FPIC), MAG Mutual , Medical Assurance / ProAssurance, Medical Mutual of North Carolina, Medical Protective, and Medicus.

Some practices decreased their malpractice coverage limits when the 2005 Tort Reform Act was passed. Others may not have considered increasing their coverage limits due to Tort Reform. The adequacy of malpractice limits is a fresh consideration now that there is no longer a cap on the amount of non-economic damages that may be awarded in a medical malpractice case.

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