Georgia Court of Appeals Overturns Massive $54M Verdict Against Avis for Crash Following Employee’s Theft of Vehicle

In a recent pair of companion cases, Avis Rent A Car System v. Johnson, 352 Ga.App. 858 (2019) and Avis Rent A Car System v. Smith, 353 Ga.App. 24 (2019), the Georgia Court of Appeals reversed massive jury verdicts totaling $54M on the grounds that an Avis employee’s theft of a rental vehicle cut off Avis’s liability for the employee’s subsequent crash that injured the bystander plaintiffs.

The two plaintiffs’ respective cases arose from the same incident where an Avis employee stole a rental SUV after hours from a downtown Atlanta branch and then later fled from the police before crashing into a brick wall where both plaintiffs were sitting. The plaintiffs suffered significant injuries and filed suit against Avis, a regional security manager, the operator of the Avis location, the operator’s owner, and the operator’s employee who stole the vehicle.

At the trial court level, the juries found that Avis was vicariously liable for the employee’s negligence in causing the crash and, in the Smith case, found that Avis was also vicariously liable for the fault that was apportioned to the operator and its owner. Avis filed a motion for a judgment notwithstanding the verdict or, in the alternative, for a new trial; the trial court denied the motions.

Avis appealed the holdings and last year the Georgia Court of Appeals reversed the verdicts and held that only the car thief employee could be held liable for the plaintiffs’ injuries. In both appeals cases, the Court of Appeals held that the at-fault employee’s criminal acts – namely, his after hours theft of the vehicle and high-speed flight from the police some five hours later – were intervening acts that severed Avis’s liability for the incident. The Court further recognized Georgia’s long line of appellate decisions holding that a car thief’s criminal acts were the sole proximate cause of plaintiffs’ injuries in those cases 

Further, in the Smith case, the Court found that Avis, the operator, and its owner could not be liable for negligent hiring and retention of the car thief employee because the employee was not acting under the color of his employment when the theft and subsequent accident occurred.

However, the two cases did not end at the Court of Appeals, as the Georgia Supreme Court granted certiorari and heard oral argument last December. The Supreme Court’s pending holding could very well dramatically alter the landscape of vicarious liability law in Georgia, so we encourage you to keep an eye on this space for further analysis once the Supreme Court issues its ruling.

Georgia Passes Law to Shield Businesses from COVID-19 Liability

The Georgia legislature recently passed a bill designed to shield healthcare facilities and other business entities from civil liability related to the spread of COVID-19. On August 5, 2020, Governor Brian Kemp signed the “Georgia COVID-19 Pandemic Business Safety Act,” which provides businesses with a general shield against civil tort lawsuits brought by members of the public, customers, or employees who alleged that they contracted or were exposed to the virus while on the premises.

Although the text of the Act is focused on healthcare providers, it applies to any “healthcare facility, healthcare provider, entity, or individual,” which, consequently, encompasses almost any business in Georgia. The Act shields businesses from COVID-19-related lawsuits except in cases where a business acted with “gross negligence, willful and wanton misconduct, reckless infliction of harm, or intentional infliction of harm.”

Additionally, businesses that provide a written warning are further protected by a rebuttable presumption that the person bringing the lawsuit assumed the risk of contracting COVID-19 by entering the business. To qualify for this additional protection under the Act, businesses must post the statutorily-prescribed warning either (1) on a sign at the business premises’ point of entry, or (2) on a receipt or as part of a proof of purchase for entry. Notably, these presumptions and written warning requirements are in addition to, and do not limit, the overall legal immunities created under the Act.

It is important to note that while the Act provides a defense against virus-related tort claims, it does not preclude claimants from bringing claims or filing lawsuits against Georgia businesses – meaning businesses will still incur the costs of defending these actions even if the Act ultimately shields them from liability. Further, the Act only protects Georgia businesses for claims arising from exposures to COVID-19 that occur up through July 14, 2021.

As Georgia business owners certainly know, the COVID-19 pandemic has created a complicated environment filled with uncertainty. While the Act provides businesses with a layer of protection for virus-related claims, owners and managers are encouraged to coordinate their reopening plans with legal counsel to ensure that they are optimally protected.

Georgia Supreme Court Expands Potential Unlimited Punitive Damages in Civil Cases Involving an Intoxicated Defendant

In Reid v. Morris, Case No. S20A0107 (Ga. S. Ct., June 29, 2020), the Supreme Court of Georgia held that under Georgia’ s punitive damages statute, a defendant may be subject to unlimited punitive damages if he commits a tort while intoxicated—even if the tort does not involve driving under the influence. In this case, the two defendants, Stroud and Morris, were drinking together, and though Stroud knew Morris was drunk, had no license, and was known to be reckless, he gave Morris his car keys and let him drive. The plaintiff was injured when his vehicle was struck by the vehicle driven by Morris.

The plaintiff sued both Morris and Stroud. He alleged that Stroud negligently entrusted the vehicle to Morris, and he sought punitive damages against both defendants. The trial court ruled that under O.C.G.A. § 51-12-5.1(f), only an “active tortfeasor” could be liable for punitive damages, which would only be the impaired driver. The Georgia Supreme Court vacated this part of the trial court’s judgment and remanded the case to determine whether Stroud was an “active tortfeasor” and thereby subject to punitive damages.

Construing O.C.G.A. § 51-12-5.1(f), the Court held that an “’active tort-feasor,’ as used in the statute, is not necessarily limited to drunk drivers.” Instead, the statute imposes unlimited punitive damages when “the defendant was intoxicated to the degree that his judgment was substantially impaired” and his “positive acts of negligence” were the proximate cause of the plaintiff’s injury.

Now, after Reid v. Morris, Defendants and liability insurers must consider the potential for unlimited punitive damages in all cases in which alcohol or drugs are involved, not just those involving DUI drivers. For example, if a homeowner has a few too many drinks before deciding to pressure wash the sidewalk in front of his house on a sub-freezing day, a resulting slip and fall accident with minor injuries could subject the homeowner to unlimited punitive damages under O.C.G.A. § 51-12-5.1(f). Thus, defendants and their counsel should anticipate that plaintiffs’ attorneys will now seek to develop evidence of possible intoxication in most every case.

Georgia Supreme Court Weighs in on Discovery Dispute Over Reasonableness of Plaintiff's Medical Bills

Discovery issues rarely reach the Georgia Supreme Court, but in the case of Bowden v. Medical Ctr., Inc., No. S14G1632, *1-25 (June 15, 2015), a discovery dispute centered around a plaintiff’s medical bills merited a 25-page unanimous opinion. Briefly, the case arose from a car accident involving a 21-year-old plaintiff, Danielle Bowden, who was treated at The Medical Center, Inc. (TMC), without health insurance, for a broken leg and subsequently received physical therapy. TMC billed her $21,409.95 for her care and filed a hospital lien for that amount. Bowden sought to invalidate the lien on the grounds that the charges were grossly excessive and did not reflect the reasonable value of the care she received. Enterprise, the insurer of the defendant, tendered its $25,000 limits, but because TMC and Bowden were unable to agree on how to apportion the settlement proceeds, Enterprise filed a complaint in interpleader against both Bowden and TMC. As part of Bowden’s answer to the interpleader action, she filed a cross-claim against TMC. It is against this procedural backdrop that this discovery dispute arises.

Bowden, as part of her cross-claim, requested information from TMC (e.g., pricing agreements with various insurance companies and Medicaid/Medicare; TMC’s total gross revenues, the percentage of patients who paid certain rates, blank forms which reflected contractual service charge agreements, etc.) targeted at proving she was charged more than other patients for similar injuries. TMC objected on the grounds of relevancy. The Georgia Supreme Court disagreed, holding, “where the subject matter of a lawsuit includes the validity and amount of a hospital lien for the reasonable charges for a patient’s care, how much the hospital charged other patients, insured or uninsured, for the same type of care during the same time period is relevant for discovery purposes.” Id. at *2. The Court went on to explain that under Georgia discovery rules, courts must interpret “relevant” broadly, as opposed to the narrower evidentiary standard used at trial, and specifically, that the discovery Bowden sought “may have some relevance to the reasonableness of TMC’s charges for her care.” Id. at *18. In dicta, the Court also rejected the notion that the mere existence of an agreement by a patient to pay hospital charges does not prove that the charges themselves are reasonable.

On a very basic level, this case is merely a reaffirmation of the broad scope of discovery entitled to litigants but it should also help the defense side of the bar access the records of medical financing companies like ML Healthcare. But discovery aside, this case could also have far-reaching, perhaps even unintended ramifications for attacking the reasonableness of medical bills. In the meantime, Defendants might want to use the Bowden decision to argue that plaintiffs have incurred unreasonably excessive medical bills which are not reflective of the value of services provided, in order to gain leverage in settlement negotiations.

Georgia Supreme Court to Weighs in on Amount of Loss Requirement for Ante-Litem Notices

The State of Georgia, including all State agencies like the Department of Human Resources or Department of Transportation, is entitled to sovereign immunity except to the extent sovereign immunity has been waived by the provisions of the Georgia Tort Claims Act (“GTCA”). [See also A Practitioner’s View of the Georgia Tort Claims Act, Georgia State Bar Journal (1992)] The GTCA provides that the exclusive remedy for torts committed by a State employee is an action against the agency. Under the GTCA, the State has agreed to waive sovereign immunity for the torts of State officials and employees subject to certain exceptions and limitations. However, no tort action can be filed against the State without first providing ante-litem notice. O.C.G.A. §50-21-26(a). This is an absolute jurisdictional requirement.

Per the GTCA, the ante-litem notice must be provided to the State within one year after the incident. It must include the name of the state entity the claim will be asserted against, the time and place of the event from which the claim arose, the nature and amount of the loss suffered, and the acts or omissions that allegedly caused the loss. O.C.G.A. §50-21-26(a). The purpose of the ante-litem notice requirement is to give the State the opportunity to investigate the claim, evaluate the claim, and hopefully, facilitate settlement before a lawsuit is filed.

Failure to adhere to the notice requirements subjects a case to being dismissed. Although Georgia courts have held that a claimant must strictly comply with the notice requirements in order to pursue a lawsuit against the State, the courts have also cited the overall purpose of the law to justify a less than hyper-technical adherence to the notice provisions. See Cummings v. Ga.Dept. of Juvenile Justice, 282 Ga. 822 (2007); Georgia Ports Auth. v. Harris, 274 Ga.146 (2001).

Recently, the Georgia Court of Appeals upheld the validity of an ante-litem notice despite the claimant’s failure to include the amount of the loss claimed. Myers v. Board of Regents, 324 Ga. App 685 (2013). In Myers, the plaintiff stepped on the edge of a pothole in a parking lot at Dalton State College and sustained a left ankle fracture and torn tendons. She received emergency medical treatment, orthopedic treatment, and physical therapy for her injuries.

The plaintiff sent her ante-litem notice approximately three months after the incident. In her notice, Myers stated that the amount of her loss was “yet to be determined as she is still incurring medical bills and does not yet know the full extent of her injury.” Lawyers for the State challenged the adequacy of the notice. The Georgia Court of Appeals refused to dismiss the case, however, finding that since Myers was still treating at the time her ante-litem notice was sent, she could not reasonably quantify the amount of her damages. In doing so, the Court of Appeals reasoned that a hyper-technical adherence to the statutory language would have barred the plaintiff’s recovery, and therefore, would not have advanced the purpose of the GTCA. The Court found Myer’s ante-litem notice provided adequate notice of the claim.

One judge dissented, however, stating that Myer’s failure to include any information regarding the amount of her loss claimed frustrated the purpose of the GTCA by preventing the State from evaluating her claim. Myers could have provided the amount of her medical expenses known at the time of her ante-litem notice, the dissent noted, and simply stated that she was still undergoing treatment. The case is now pending in the Georgia Supreme Court.

In another recent case, the Georgia Court of Appeals found that the claimant failed to comply with the GTCA when he did not include the amount of loss claimed in his ante-litem notice. Driscoll v. Board of Regents, 326 Ga. App. 315 (2014). In Driscoll, the Court of Appeals stated that while plaintiff’s failure to include the amount of loss claimed in Myers was sufficient due to her on-going treatment, the plaintiff in Driscoll failed to make any mention of the amount of loss, even though they were known and complete at the time. Furthermore, there was nothing about the circumstances of Driscoll’s treatment or loss that prevented him from providing the specific amount of his loss.

These two cases evidence the balancing act the courts take between ensuring compliance with statutory requirements and advancing the legislative intent of the GTCA. If the Supreme Court upholds the decision in Myers, it will effectively negate the legislative mandate that claimants include the amount of loss they have allegedly suffered in an ante-litem notice prior to filing suit against the state, except in the most limited circumstances.