Dan Berexa's Tennessee Law Blog

Tennessee Supreme Court Grants Appeal of Decision Holding Med Pay Carrier Liable for Missing Hospital Lien

In Shelby County Health Care Corp. v. Nationwide Mutual Ins. Co. (filed Feb. 6, 2009) the Western Section held that Nationwide impaired a hospital lien by applying some of its insured's med pay proceeds to an ambulance bill. As a result, Nationwide was held liable for the entire hospital bill (close to $34,000) pursuant to Tenn. Code Ann. § 29-22-104(b)(1), despite the fact that the med pay coverage was only $5000 in the first place. See my February 10, 2009 post for a discussion of the decision and the implications if it is not reversed or modified by the Tennessee Supreme Court. The application for permission to appeal was granted November 2, 2009.

Dan Berexa
Nashville, Tennessee

Comment Period Coming to End for Proposed Amendments to Tennessee Rules of Civil Procedure

Every year the Advisory Commission on the Rules of Practice and Procedure presents recommendations to the Tennessee Supreme Court for amendments the Rules of Procedure and Tennessee Rules of Evidence.  The Court is soliciting written comments on the proposed amendments through November 30, 2009.  The significant proposed amendments to the Tennessee Rules of Civil Procedure are as follows:

 

Rule 4.01 – the filing of a complaint is ineffective if plaintiff’s counsel intentionally delays issuance of the summons or service for more than thirty (30) days

Rule 5.02 – permits service on attorney via e-mail if document is in Adobe PDF format.  The sender must mail, fax or hand-deliver a seperate notice that advises that the document served has been transmitted electronically.

Rule 5(b) – permits courts to adopt local rule allowing electronic filing.

Rule 26.02 – permits discovery of liability insurance.  

Rule 41.02(2) – requires findings of fact and conclusions of law in the event trial court dismisses an action pursuant to Rule 41.02.

Dan Berexa
Nashville, Tennessee

 

Don't Count on Tennessee Courts to Limit Ratio of Punitive to Compensatory Damages to a Fixed Number

For those looking for a mathematical bright line rule to determine an acceptable ratio of punitive to compensatory damages, the Tennessee Supreme Court recently backed away from employing a strict ratio based analysis. Prior decisions indicated that a punitive award that was more than 4 times the compensatory award may not withstand constitutional scrutiny (See November 23, 2008 post). In Goff v. Elmo Greer & Sons Construction Co. (November 3, 2009), the Tennessee Supreme Court reduced what was originally a $2,000,000 punitive award to $500,000. While the reduction was significant, the compensatory damage award for the conduct that supporting the punitive award was only $3,305. Thus, even after the reduction, the punitive to compensatory damages ratio was 150:1.

 

Goff is another decision in the growing body of Tennessee Supreme Court precedent addressing the sufficiency of evidence necessary for a punitive damage award and the factors utilized in determining whether the size of the award violates the defendant’s due rights under the 14^thAmendment. In connection with determining whether a punitive award is grossly excessive and violates due process, the court is to focus on the degree of reprehensibility of the defendant's conduct; the disparity between the harm (or potential harm) and the award; and, the difference between the punitive damages and other available penalties. The bottom line is that Goff gives the court a great deal of discretion when reviewing a punitive award and a high punitive to compensatory damage ratio alone will not be enough to make the award suspect.  

 

Dan Berexa

Nashville, Tennessee