Medical Malpractice Law Changes Lead to

Broad Civil Justice Reform Adopted in Georgia

Robert C. Threlkeld, Esq.

Partner, Morris, Manning & Martin, L.L.P.

The tort reform bill that Governor Perdue signed, SB3 (the “Act”), will have a significant impact upon health care providers in the State of Georgia. It also will have wide ranging impact upon other litigants in Georgia, regardless of whether the action is one for medical malpractice. Indeed, though its provisions respecting malpractice reform were widely trumpeted, many provisions that will have far reaching impact upon parties in Georgia’s civil courts passed without much notice or comment. This article summarizes the Act, illustrates the provisions that apply specifically to health care providers and those that have broader ramifications, and identifies particular areas that are likely to meet court challenges.

Venue and Forum Provisions

The first set of changes under the Act relate to the proper venue and forum for an action. The Act provides that actions against joint tortfeasors may be brought in any county in which one or more defendants reside. If, however, all residents of that county settle or are dismissed from suit prior to the return of a jury verdict, then a non-resident of that county who is still a defendant may require that a case be transferred to where venue would be proper. O.C.G.A. § 9-10-31(d).

However, the Act also provides that in a medical malpractice case a non-resident defendant may require that the case be transferred to the county of the medical malpractice defendant’s residence if the tortious act that is the basis of the medical malpractice claim occurred in that defendant’s county of residence. Potentially, this gives a medical malpractice defendant the home court advantage if the alleged tortious act giving rise to the claim occurred where that defendant lives. The Act, however, does not define with precision the issue of what is the “tortious act upon which the medical malpractice claim is based,” a phrase that is likely to be the source of significant litigation. O.C.G.A. § 9-10-31(c).

The Act also imports into Georgia civil practice the concept of forum non-conveniens. Essentially, under the Act a court can decline to hear any case that could have been brought outside the state, or in another county in the state, if the court finds in the interests of justice and for the convenience of the parties and witnesses the claim would be properly heard elsewhere. The Act sets forth a laundry list of factors for a court to consider, including location of witnesses and evidence, traditional deference to a plaintiff’s choice of forum, and unnecessary inconvenience to the defendant that is not necessary to the plaintiff’s right to seek a remedy. Before obtaining an Order under this forum non-conveniens statute, a litigant must file a stipulation that the litigant will not elsewhere raise a statute of limitations defense that did not exist as of the original filing date. O.C.G.A. § 9-10-31(a).

These changes respecting venue and forum non-conveniens are striking. They make a plaintiff’s forum shopping more difficult. Moreover, the forum non-conveniens provisions make it more difficult to access Georgia courts particularly when the conduct in questions whether it be an action in tort or in contract, has taken place outside of Georgia and relevant witnesses are located elsewhere.

Medical Malpractice Affidavits

The Act specifically addresses the sufficiency of medical and other professional malpractice affidavits in Georgia. The Act now requires that an affidavit in any professional malpractice case be filed by “an expert competent to testify, which affidavit shall set forth specifically at least one negligent act or omission claimed to exist and the factual basis for each such claim.” O.C.G.A. § 9-11-9.1(a). As described below, the Act amends the evidence code in numerous ways to address when an expert is competent to testify. The Act now provides that if the affidavit is not filed at the time the Complaint is filed, then the Complaint is not subject to renewal; in other words, it may be dismissed and if the statute of limitations has expired may not be re-filed. The only caveat to that is if a Court determines that the plaintiff had the affidavit in hand when the Complaint was filed, but because of “mistake” failed to file it. Additionally, if at any time prior to the close of discovery a defendant files a motion alleging with specificity that the affidavit is insufficient, then the complaint is subject to dismissal for failure to state a claim, except that the plaintiff may cure the defect within 30 days of service of that motion.

Broad Changes Respecting Experts

Probably the most controversial provision of the Act’s new affidavit requirements is the phrase an “expert competent to testify.” In this regard, the Act makes sweeping changes to Georgia law on the use of experts, not only in a medical malpractice case, but also in all cases where expert testimony is offered. The Act does this by amending Georgia’s evidence code, O.C.G.A. § 24-9-67. Formerly, the rule in Georgia was that the opinions of experts on any question of science, skill, trade or like questions were always admissible. Moreover, those opinions could be based on the facts as proven by other witnesses. Finally, the ultimate test on the admissibility of expert testimony was whether the expert generally had knowledge beyond the general understanding of a layperson, and whether that knowledge would be “helpful” to the jury.

That is not so anymore. Now, in civil cases in Georgia the opinion of a witness in non-scientific matters “may be given on the facts as proved by other witnesses.” Further, if the facts or data are of a type “reasonably relied upon by experts in the particular field” in forming opinions or evidence, the facts or data need not be admissible in evidence in order for the opinion to be admitted. Moreover, facts or data that are otherwise inadmissible may not be disclosed to the jury by the “proponent of the opinion” unless the court determines that their probative value in assisting the jury to evaluate the court’s expert opinion substantially outweighs their prejudicial effect.” O.C.G.A. § 24-9-67.1(a).

What does this mean? First, it clearly means that if an expert is relying upon facts or data that other experts reasonably rely upon, then the underlying data need not be admissible. It is easy to conjure a scenario where this will trip up an expert. For example, if an expert uses a unique method or analysis to arrive at his opinion, then a party can successfully urge that the facts or data “are not reasonably relied upon” by other experts in that field. If that is the case, then the underlying data will have to be admissible. Since that data often will be subject to hearsay and best evidence objections, the opinion of that expert may not be admissible if the data is not independently admissible.

The test is even more rigorous if the testimony relates to “scientific, technical or other specialized knowledge.” There, a witness who is qualified as an expert on the basis of “knowledge, skill, experience, training or education” may testify in the form of an opinion, but only under certain limited circumstances. Those include if:

(a) the testimony is based upon sufficient facts or data which are or will be admitted into evidence at the hearing or trial;

(b) the testimony is the “product of reliable principles and methods;” and

Thus, if the expert testimony relates to “specialized knowledge,” which arguably goes far beyond the scientific and technical field to financial and other matters, then the testimony has to be based upon facts that are admitted, be the product of reliable principles and methods, which in turn have to be applied “reliably” to the facts. This standard will likely require the trial court to perform a gatekeeper function in any civil action, much like in federal courts, that a trial court may or may not be well situated to perform. In that regard, the Act provides that upon motion of a party the “court may hold a pretrial hearing to determine whether the witness qualifies as an expert and whether the expert’s testimony” meets these tests. O.C.G.A. § 24-9-67.1(d). The novelty of this underlying test will undoubtedly be the source of significant litigation in Georgia courts for years to come.

Finally, the Act provides that it is legislative intent that expert evidence in Georgia not be admitted “that would not be admissible in other states.” What states the Act is referring to is unknown. However, the Act does provide that the tests of the Supreme Court in Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579 (19983) and Kumho Tire Co. Ltd. V. Carmichael, 526 U.S. 137 (1999) should be applied.

Experts For Medical Malpractice Cases

If you are a medical malpractice litigant, the standard is even higher. Now, to be an expert in a medical malpractice case a person has to be (a) licensed where the person is practicing or teaching; and (b) have actual professional knowledge and experience in the area of medical practice or specialty in question as the result of (i) regularly practicing in that specialty within three of the last five years to establish an appropriate level of knowledge as determined by the trial court in performing the procedure or diagnosing the condition or rendering the treatment about which the expert is to opine; or (ii) having taught within three of the last five years as an employed faculty member again with sufficient frequency to have an “appropriate level of knowledge” as determined by the court to opine on that subject. In addition, the medical expert must be a member of the same profession, or is medical doctor if testifying about osteopathic care, or an osteopath if testifying about medical care. Finally, in that regard, an expert who has the qualifications in (b)(i) & (ii) above, who is a physician and supervised nurses, nurse practitioners and the like, may testify as to the standard of care of those providers if the physician has knowledge of that standard. The Act makes clear that those providers cannot, however, testify as to the standard of care of a physician. Notably, the Act provides that to meet the expert affidavit requirement, an expert must meet these standards. O.C.G.A. § 24-9-67.1(c).

The Act Makes Sweeping Changes Respecting Imposition of Liability

The Act also makes dramatic changes in Georgia law respecting the apportionment of liability. Indeed, for tort actions the Act eliminates the concept of joint and several liability. It also requires a reduction in damages award for any percentage of fault of the plaintiff that a jury finds. These are dramatic changes. The following is a synopsis of how these changes would work.

First, under O.C.G.A. § 51-12-33(a), a jury must decide the plaintiff’s percentage of fault. For whatever that percentage is, any damages award must be reduced by that percentage. Once that is done, if the plaintiff has sued two or more persons, then the jury (or judge if it is a bench trial) must decide the percentage of fault of each person. Damages then will be apportioned by the percentage of fault; no longer will one defendant be responsible for the entirety of a damages award so long as that defendant is liable with a second party, and that second party bore some measure of fault. O.C.G.A. § 51-12-33(b). Additionally, in assessing percentages of fault, a jury also can apportion blame to someone who contributed to the alleged injury, regardless of whether they were named as a party to the suit. Further, negligence of fault of a non-party “shall be considered” if the plaintiff entered into a settlement agreement with a non-party or if a defending party gives notice not later than 120 days prior to the trial date that a non-party was at fault.

This will have a big impact on trial and settlement strategy. For example, a deep pocket defendant will argue that it should not bear the entire responsibility for a particular wrong. If it does so and prevails, a plaintiff may be stuck attempting to collect part of a judgment from a solvent defendant, and part of a judgment from a defendant that cannot pay. By the same token, a non-settling party now can free ride off the settlement of another party, and argue that such party was responsible for the majority of the wrong, merely because that party (which settled after all) is not present at trial. At a minimum, this new regime will give a plaintiff pause to consider before accepting a nominal or less than adequate settlement from a relatively minor defendant prior to trial, if the plaintiff believes the remaining defendants can convince a jury that the settling parties bore the brunt of the responsibility for the wrong. It also may create incentives for certain defendants to hold out and see whether other, perhaps arguably more culpable defendants may settle, before determining whether to take its chances at trial.

There are a number of unanswered questions under this portion of the Act. What if various defendants conspire to accomplish an unlawful act. Under the common law, a conspirator is generally responsible for all wrongs committed pursuant to the conspiracy. Does this principle still exist? Arguably no, if the wrong for the underlying bad act that the defendants conspired to commit can be apportioned between the defendants. Does this mean that third party settlements can be argued to the jury, as evidence of relative fault of the parties? Again, this is an open question under the Act.

The Overturning of the Traditional American Rule for Attorneys Fees

The Act also significantly changes what had been the “American rule” that each party bears its own attorneys fees, absent bad faith conduct on the part of the opposing party, at least as applied to tort claims. Now, under O.C.G.A. §§ 9-11-68(a) – (c), at any time more than thirty days after service of a complaint that alleges a tort claim either party may serve upon the other party an offer of judgment that identifies the claim, and states with particularity the amount proposed to settle the claim, including a claim for punitive damages, as well as a claim for attorneys fees. If the offeree does not accept the offer, and the judgment “finally obtained by the offeree was not at least twenty-five percent (25%) more favorable than the last offer” the offeree shall pay the offeror’s reasonable attorneys fees and costs incurred after the rejection of the last offer.

This is a radical departure from the normal rule. The only caveat is that if a party is entitled to costs and fees pursuant to this twenty-five percent rule, then the court “may determine that the offer was not made in good faith in an order setting forth the basis for that determination”, in which case it can disallow the award of attorneys fees and costs.

New Jury Procedure For Attorneys Fees

The Act also now gives a litigant – whether a plaintiff or defendant – a chance to bring an attorneys fees claim before the jury at the time a verdict was rendered, regardless of whether the case is a tort or contract case. Prior to the Act, if a defendant prevailed at trial, the only chance it had to recover fees was to bring a bad faith motion under O.C.G.A. § 9-15-14 within forty-five (45) days after the entry of final judgment; a plaintiff, in contrast, could bring a bad faith claim under O.C.G.A. 13-6-11. Previously, the trial court would hear those motions by the defense, and a plaintiff would have to prove up its attorneys’ fees claim generally in its case in chief. Now, a defendant, or a plaintiff if the plaintiff prevails, can at the time of the verdict put before the jury, via motion, a claim for attorneys fees based on the fact that the claim or defense (1) lacked “substantial justification” or was “not made in good faith” or “made with malice or a wrongful purpose,” or an attorneys fees claim based on the fact that a claim, defense or other position was “interposed for delay or harassment,” or (2) that the claim or defense was such that there existed such a complete absence of any justiciable issue of law or makes fact that the party could not reasonably have believed the court would accept it, or (3) that the claim, defense or other position was “interposed for delay or harassment.” See O.C.G.A. § 9-11-68(e). This new procedure will undoubtedly chill many litigants from bringing certain claims or defenses if they believe a jury can award attorneys fees to the other side.

Expressions of Regret in Medical Malpractice Cases

The Act accomplishes a number of things that do apply only to medical providers. Now, statements of assistance, regret, error or sympathy by a health care provider is not admissible in a civil action. The stated reason is to encourage such statements, rather than to construe them as an admission of liability. This is of significant value to health care provider defendants, because numerous studies have shown that statements of regret or apology can serve as a deterrent to suit. O.C.G.A. § 24-3-37.1.

A New Standard of Care for Emergency Room Providers

The Act also provides relief to emergency room providers, and providers who render emergency care in a surgical suite or obstetrical unit immediately following the evaluation of a patient in an emergency department. Under the Act, a health liability claim arising out of the provision of emergency medical care in those contexts cannot prevail unless it is proven by “clear and convincing evidence” that the physician or health care provider’s actions showed gross negligence.” O.C.G.A. § 51-1-29.5(c). The Act also provides that a jury shall be instructed on several factors helpful to emergency care providers, including whether there was a preexisting patient relationship, and whether the provider was able to obtain a full medical history, which often is not possible in emergent contexts.

The Act goes further, too, and provides that so long as a hospital complies with certain closely delineated notice requirements, then it will not be responsible for the conduct of any health care professional performing emergency services unless that professional is an employee or agent. That has generally been the rule in Georgia, but the codification of the rule permits a hospital to more readily establish that defense. The Act also defines certain standards by which a court will find whether there was an independent contractor or employment relationship between a hospital and emergency room physician. First, an underlying contract will control. Even absent a contract, it will be difficult for a plaintiff to meet to meet those standards, which include (a) the intent of the parties, (b) whether the health care professional receives substantially equivalent benefits as those of other hospital employees, (c) whether the hospital “directs the details of the health care professional’s work step by step,” (d) whether the services are terminable at will of the hospital without cause and without notice, and (e) whether the hospital withholds taxes.

Likewise, the Act also indicates certain factors that cannot be considered, which can include the right of control the hospital exercises over time, manner, or method of services, control over benefits, payment on an hourly basis, billing for services, whether the professional maintains a separate practice, the source of payment for liability insurance premiums, or hospital requirements that a provider adhere to a certain regulatory standard. It is at least worth noting that control over time, manner and method of services, except for the Act’s provisions is a classic factor to consider in determining if there is an employment relationship.

Caps on Damages in Medical Malpractice Cases

Finally, and perhaps most importantly for health care providers, the Act gives health care providers their long coveted relief of capping non-economic damages. Now, under the Act, damages for non-economic damages are capped at $350,000 for any medical malpractice action, including one for wrongful death that is brought against one or more health care providers, or a single medical facility. If a case is brought against multiple hospitals, then the cap for non-economic damages increases to $700,000.

There will undoubtedly be challenges to the constitutionality of this cap on damages, and perhaps to other provisions of the Act. These could range from an alleged infringement on the federal and State guarantees of Due Process, to a violation of the Seventh Amendment right to a jury trial in civil cases. Whether these challenges would be successful is very unclear; the Georgia courts will determine the nuances and enforceability of the Act over the next few years. But what is certain is that the Act will change substantially the civil practice of law in the State of Georgia in dramatic ways.