Monday, July 28, 2014

How Settlement Can Affect Contribution Claims and Apportionment in Multi-Party Cases

by Craig Brookes

Since apportionment is a relatively new concept in Georgia, the cases have not fully evolved to take into account all the potential interactions between apportionment, contribution and indemnity among alleged joint tortfeasors.  However, in Zurich Am. Ins. Co. v. Heard, 321 Ga. App. 325 (2013) , a decision from last year,  the Georgia Court of Appeals “clarified” certain concepts surrounding these issues.  Our analysis of Zurich, prior contribution/indemnity cases and subsequent cases lead us to  the conclusions that follow:

As an initial matter, if a defendant in a multi-party case resolves the case with Plaintiff, the Court would then enter an order allowing the dismissal of the settling defendant.  Theoretically, the remaining defendant could object to the dismissal, but it is unlikely any remaining defendant would want additional defendants in the case or have any viable legal claim to avoid the dismissal based on the settlement.  It would also be unlikely for the Court to deny a dismissal motion from the plaintiff and settling defendant, even if the remaining defendant objected for some reason.   As a practical matter, we believe in most circumstances, the remaining defendant would rather defend the case by blaming the settling defendant (i.e. the empty chair defendant) and arguing apportionment to the jury, than deal with the settling defendant as a potential adversary.  In other words, in most cases, there appear to be no viable legal claims that could be brought by the remaining defendant against the settling defendant.  Specifically, since a jury is allowed to apportion damages at trial, the common law contribution “cross claim” no longer exists in Georgia.  Under the apportionment statute, the apportionment by the jury defines the parties exposure, not a subsequent action seeking pro rata contribution.  As such, there would be no “cross claim” for contribution.  

As an aside, in determining whether or not claims may remain against a settling defendant, indemnification claims must be considered.  An indemnification claim exists when one defendant has a non-delegable duty (such as a property owner in a premises case) and the co-defendant caused the alleged injury (like a cleaning company who created a hazardous condition that caused the Plaintiff to fall).  In this example, the property owner would have an indemnification claim against the cleaning company, since the property owner can be held liable to Plaintiff based on his non-delgable duty to keep his premises safe.  Before settling in a multi-party case, potential indemnification claims should be evaluated separately from contribution claims. 

Interestingly, under Zurich, the settling defendant would have a contribution claim against the remaining defendant.  Specifically, any settlement by a defendant would result in the ability to seek contribution on a pro-rata basis from the remaining defendant(s).  In a two defendant case with one defendant settling, the settling defendant would have a contribution claim for 50% of the amount paid in the settlement.  For example, if the settling defendant paid $400,000 to resolve the case, it would have a potential contribution claim for $200,000.00.  Recent case law has confirmed that the contribution  claim will exist up through and including the time that the jury apportions fault.  So, if one defendant settles and the remaining defendant goes to trial, the remaining defendant’s liability is fixed (assuming any amount is awarded to Plaintiff) and the settling defendant’s contribution claim no longer exists.  Further, after apportionment, the remaining defendant (who tried the case) would no longer have any potential contribution claim against the settling defendant since its percentage of fault would have been determined by the jury. 

Theoretically speaking, if one defendant settles with Plaintiff and the remaining defendant settles at a later date with Plaintiff, there is a scenario where the defendant who settled last, could have a contribution claim against the defendant that settled first.  Specifically, this could happen if the defendant, who settled last, paid more than the defendant who settled first.  For example, if the first defendant settled for $100,000, the second defendant (in a two defendant case) would have to pay more than twice that amount to get any contribution, as contribution is calculated on a pro rata basis.  Assuming the first settling defendant paid $100,000 to resolve the case and the second defendant settled for $150,000, the first settling defendant’s pro rata share would be $125,000.  In that case, the first settling defendant is subject to a contribution claim for $25,000.00 (the difference between the settlement amount of $100,000 and its pro rata share of the $250,000 settlement (i.e. $125,000).   

The interaction between contribution claims and apportionment is an important consideration in the resolution of multi-defendant cases.  If you have any questions regarding these concepts, please feel free to contact Craig A. Brookes or any of our other attorneys at 404-892-1991.

Wednesday, April 23, 2014

Guest of a Nursing Home Resident: Licensee or Invitee?

by Karen Lea Smiley

In Georgia, the duty owed to an individual injured on someone else’s property is determined by the legal status of that injured individual.  The legal status can either be one of “invitee,” “licensee,” or “trespasser.”  Under O.C.G.A §51-3-2, the owner or proprietor of the premises is liable only for willful or wanton injury to a licensee, whereas he owes an invitee the duty to exercise ordinary care in keeping the premises safe. 
To determine whether an injured party is an “invitee” or a mere “licensee,” the nature of his relationship or contact with the owner or occupier of the premises must be determined. The test used to make this determination is ‘whether the injured person at the time of the injury had present business relations with the owner of the premises which would render his presence of mutual aid to both, or whether his presence on the premises was for his own convenience.” Armstrong v. Sundance Entertainment, 179 Ga. App. 635, 347 S.E.2d 292 (1986).
The Georgia Court of Appeals has utilized this test to determine the relationship of visitors to various facilities, including nursing homes.  In one instance, the Court of Appeals used this test to determine whether an individual visiting a family member in prison was an invitee or a licensee.  In that instance, the court learned that the prison used visitation rights as a tool to influence prisoner behavior, and used the ability to have or not have visitors as a privilege and not a right.  The court found that visitation between inmates and their visitors benefited both the visitor and the prison creating a mutual benefit.  Thus, the visitor was considered to be an invitee and the higher standard applied whereby the prison was deemed to owe the visitor the duty to exercise ordinary care in keeping the premises safe.  Freeman v. Eichholz, 308 Ga.App 18, 705 S.E.2d 919 (2011).
In a nursing home, residents are authorized to have visitors. In virtually all cases the ability to have visitors is a right belonging to the resident, and not a privilege which can be taken away or used as an incentive. Although it could be argued that visits from friends and families have a positive effect on the resident which may benefit the nursing home, when applying the test ascribed above the more likely result is a finding that the visitor, is in fact, a licensee.  Visitors come to the nursing home to visit the resident.  The visit is not, in most instances, a business exchange with the nursing home, and typically does not result in a benefit to the nursing home.  In fact, the daily access of visitors to residents of the nursing home may be seen as creating an additional burden upon the nursing home, which must conduct its business with the residents around the guests and visitors.  In most guest scenarios, the guest’s presence at the nursing home is not for the mutual benefit of the guest and the nursing home.  Rather, it is for the benefit of the guest and the resident. As such, nursing home residents should, in most circumstances, be considered to be licensees for purposes of determining the duty owed to them by the nursing home. 
There are some factual scenarios, however, where the analysis might result in a determination that the nursing home visitor is an invitee.  For example, in Jones v. Monroe Nursing Home, 149 Ga.App 582 (1979), an 8 year old girl went to the nursing home with her mother, who was an employee.  The Court of Appeals held that the nursing home did get some economic benefit from the girl’s presence at the nursing home and, as such, she was determined to be an invitee.  In that case, the mother would not have been able to work had she not been able to bring her child to the nursing home.  In addition, at the time she was injured, the girl was running an errand for a resident (going to the resident’s room to obtain paper and pen) which otherwise would have been run by a nursing home employee. Although the Court of Appeals did not hold that the girl was in fact an invitee, it held that there was sufficient evidence that a jury could find her status was elevated from licensee to invitee based upon these facts. The actual determination of her status was a question of fact left to the jury for determination. In support of the determination that guests at a nursing home are licensees and not invitees, the Court of Appeals has also analyzed the status of a guest visiting a hospice resident and affirmatively held that the plaintiff was a social guest of the resident, and that as a social guest her status was that of a licensee.  Davis v. Scott, 232 Ga. App. 493, 502 S.E.2d 332 (1998).
Unfortunately, the matter is complicated by an old Court of Appeals decision wherein the legal status of a guest of a hospital patient was analyzed.  In Candler General Hospital, Inc. v. Purvis, 123 Ga. App. 334, 181 S.E.2d 77 (1971), the Court of Appeals held that the mutuality of interest required to make a guest an invitee does not require a commercial business transaction.  The Purvis Court held that “the visitor is an invitee if the enterprise is mutual, each lawfully interested therein or there being a common interest or mutual advantage involved… When a hospital provides a viewing window for the display of new-born babies, encourages relatives and friends to visit the sick and disabled, there is created an issue as to whether or not these” visitors are invitees.

The answer to the question of whether a guest of a nursing home resident is an invitee or a licensee is not a black and white one, but rather depends on a review and evaluation of the specific factual circumstances.  Did the guest offer some mutual benefit to the nursing home? Did the nursing home encourage or otherwise “invite” the guest to the facility? Once these factual circumstances have been explored, the nursing home can better understand whether the guest in question was an invitee or a licensee, and with that knowledge it will glean the appropriate standard of care to be applied.