In 2005 the Georgia Legislature passed tort reform legislation which made sweeping procedural and substantive changes to existing tort law.
In 2005 the Georgia Legislature passed tort reform legislation which made sweeping procedural and substantive changes to existing tort law. The reforms had the potential to significantly reduce the cost of litigation in the long term: the question was simply which provisions would hold up to appellate challenges and how long it would take for those challenges to be heard.
Five years later, the dust is beginning to settle. The Georgia Supreme Court has issued three major rulings on tort reform provisions in the last month, upholding both the offer of judgment provisions of O.C.G.A. § 9-11-68 and the application of the “gross negligence” standard of care in certain medical malpractice claims standard against a number of constitutional challenges. The Court also unanimously overturned Georgia’s cap on non-economic damages in medical malpractice cases.
The offer of judgment provision of O.C.G.A. § 9-11-68 is a mechanism which allows parties to make formal pre-trial settlement offers. A party rejecting such offer of judgment who then receives an unfavorable verdict runs the risk of paying the offeror’s attorney fees and expenses of litigation through trial. Specifically, a plaintiff who rejects an offer of judgment and does not recover at least seventy five percent of the amount of the offer at trial may be held liable for the defendant’s costs and fees from the date of the offer.
In Smith v. Salon Baptiste (S09A1543, decided March 15, 2010), Plaintiffs challenged the offer of judgment statute on grounds that it violated several provisions of the Georgia Constitution: specifically, they argued that it violated a right of access to the Courts and was a “special law” violating the uniformity of the Georgia Constitution. The Court rejected both arguments. Five of seven justices agreed that the statute does not violate a purported right of “access to the Courts” in the Georgia Constitution because the constitutional provision in question does not create such a right at all: it simply guarantees an individual the right to choose between self-representation and being represented by counsel (a choice which is not affected by the offer of judgment statute). Moreover, the offer of judgment statute is not a “special law” within the meaning of the Georgia Constitution because it “operates uniformly throughout the state upon the subject or class of subjects with which it proposes to deal…The clear purpose of this general law is to encourage litigants in tort cases to make and accept good faith settlement proposals in order to avoid unnecessary litigation.”
The second tort reform provision to come “under fire” recently is the legislative adoption of a “gross negligence” standard of care for certain medical malpractice claims. Specifically, the legislature required in O.C.G.A. § 51-1-29.5(c) that when a medical malpractice claim arises from treatment in hospital emergency departments or from certain medical care in obstetrical units or surgical suites, a plaintiff may not recover without establishing by “clear and convincing evidence” that the defendant was “grossly negligent.”
Plaintiffs attacked the constitutionality of this statute, arguing again that it was a “special law,” that it violated the equal protection provisions of the Georgia constitution, and that the “gross negligence” standard was unconstitutionally vague.
The Court rejected these arguments by a 4-3 margin in Gliemmo v. Cousineau , issued the same day as the Smith opinion discussed above. The Court held that the statute is a general law rather than a “special law” under the meaning of Georgia’s constitution, because “ it operates uniformly upon all health liability claims arising from emergency medical care as provided under the statute and… that classification of designated cases is neither arbitrary nor unreasonable.” The Court also rejected the equal protection claims because the statute is rationally related to a legitimate governmental interest and because the phrase “gross negligence” is not unconstitutionally vague.
A week after the defendant-friendly rulings in Smith and Gliemmo the Court issued a significant ruling for plaintiffs, striking down statutory caps on non-economic damages in medical malpractice cases. In 2005 the legislature imposing a structure on pain and suffering awards in medical malpractice cases of anywhere from $350,000 or – depending on the nature of the defendants – up to $1,050,000.00. See O.C.G.A. § 53-3-1. Plaintiffs challenged the statute on grounds that it violated a constitutional right to have damages determined by a jury and in Nestlehutt v. Atlanta Oculoplastic Surgery, P.C. the Supreme Court of Georgia agreed. The Court held that the damage caps undermine a jury’s role in determining damages, nullifying the basic function of the jury. The Court noted that although the legislature generally has authority to define, limit and modify available remedies, this authority does not extend to abrogating rights granted by Georgia’s Constitution. The holding applies retroactively to existing cases.
The Nestlehutt ruling is unlikely to be reversed soon. The justices agreed unanimously on the outcome of the case and its core holding. Morevoer, the Court held that the constitutional issue was not the amount of the caps: “[t]he very existence of the caps, in any amount, is violative of the right to trial by jury.” The only “higher” court of review, the United States Supreme Court, has a long history of permitting states to interpret their own constitutions. Put simply, it would take an amendment to the Georgia Constitution to overturnNestlehutt.