State high court overturns state's tort reform

The state high court determined that a $350,000 cap on noneconomic damages, which includes compensation for a plaintiff's pain and suffering, violates the right to a jury trial as guaranteed under the Georgia Constitution.

The ruling upheld a $1.265 million jury award to Marietta real estate agent Betty Nestlehutt, now 75. After a face-lift operation in 2006, Nestlehutt's face was covered with gaping wounds that required prolonged, excruciating treatments to keep them from becoming infected. The wounds left her permanently disfigured.

In its decision, the state Supreme Court noted that the right to a jury trial for negligence claims against health care providers predates the adoption of Georgia's Constitution in 1798.

The 2005 law's cap on damage awards "clearly nullifies the jury's findings of fact regarding damages and thereby undermines the jury's basic function," Chief Justice Carol Hunstein wrote for the court. She added, "The very existence of the caps, in any amount, is violative of the right to trial by jury."

The decision puts the General Assembly on notice that any renewed effort to impose caps on jury awards will be futile, said Atlanta lawyer Michael Terry, who argued the case on Nestlehutt's behalf. "The court was very clear in saying, ‘You can't do this.' "

House Majority Leader Jerry Keen (R-St. Simons Island), a supporter of the limits, said he did not know what the Legislature could do in response. Up to now, he said, the law has served its purpose.

"As everyone knows it has created a greater degree of access to health care," Keen said. "We've had doctors moving into the state rather than leaving."

Senate Judiciary Committee chairman Preston Smith (R-Rome), a sponsor of the legislation, said, "We have taken a step back. Our rates will be more expensive and less accessible."

Georgia's 2005 tort reform law sparked intense legislative debate and pitted medical and hospital associations against trial lawyers and consumer groups. Last week, in a 4-3 decision, the state Supreme Court upheld another key provision of the law that makes it almost impossible for patients to recover damages in malpractice cases involving emergency room care.

MAG Mutual Insurance Co., which provides malpractice insurance to most Georgia doctors, said its insurance premiums have dropped since the tort reform law was enacted five years ago. "This is a setback for Georgia citizens seeking medical care and a defeat for Georgia's citizens," Roy Vandiver, MAG Mutual's chairman, said of Monday's decision.

Danny Orrock, deputy director of the consumer group Georgia Watch, applauded the ruling. "The decision favors the protection of patients and their constitutional rights," he said. "It restores the promise of justice for all and the rights of all Georgians -- young and old, rich and poor -- to access the courts."

About two dozen states have enacted caps on damage awards in medical malpractice cases. Last month, the Illinois Supreme Court declared unconstitutional a $500,000 cap against doctors and a $1 million cap against hospitals. Georgia's tort reform law limited awards to $350,000 against doctors and capped total awards at $1.05 million in cases involving multiple health-care providers and medical facilities.

After a trial, a Fulton County jury awarded Nestlehutt $115,000 for past and future medical expenses and awarded Nestlehutt and her husband, Bruce, $1.15 million in noneconomic damages, including $900,000 for her pain and suffering. Atlanta Oculoplastic Surgery and Dr. Harvey "Chip" Cole, who performed the operation, appealed the judgment, contending the Nestlehutts should receive no more than $465,000 -- including $115,000 for the medical expenses and the $350,000 cap.

Because the state Supreme Court found that caps on damage awards violate the Georgia Constitution, there will be no further appeal, Cole's lawyer, Jonathan Peters, said.

Atlanta attorney Adam Malone, who represented Nestlehutt at trial, said his client was the face of her real estate business and decided to have surgery when she found more and more clients seemed to prefer younger agents. But after the face-lift, Nestlehutt's face was so disfigured she no longer left home, he said.

Malone said the $900,000 jury award for the devastation of Nestlehutt's quality of life was justified and the Georgia Supreme Court did the right thing in upholding it. "The bedrock of our democracy depends upon our ability to self-govern at the ballot box and in the jury box," he said. "Any attempt by the government to invade either is an assault on what separates America from the rest of the world."

Staff writers Aaron Gould Sheinin and Ernie Suggs contributed to this article.

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