Automobile Insurance SubrogationAutomobile Total Loss ThresholdsDeductible ReimbursementDiminution of ValueFirst Come, First Served: Subrogating Multiple Claims in Excess of Policy LimitsFuneral Procession Traffic LawsImputing Contributory Negligence of Driver to Vehicle OwnerLaws Regarding Using Cell Phones/Headphones/Texting While DrivingLoss Of UseMed Pay/PIP SubrogationOwner Liability For Stolen VehiclesPayment of Sales Tax Vehicle Total LossPedestrian and Crosswalk LawsRental Car Company Physical Damage and Loss of Use ClaimsRental Car Company’s Liability Insurance Primary or ExcessSlower Traffic Keep RightSudden Medical Emergencies While DrivingSuspension of Drivers’ LicensesUse of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Federal , State, and Local Governmental EntitiesMuncipal/County/Local Governmental Immunity and Tort LiabilityState Sovereign Immunity And Tort Liability
General Tort Laws/StatutesAnti-Indemnity StatutesContribution ActionsContributory Negligence/Comparative FaultDog Bite LawsEconomic Loss DoctrineParental ResponsibilitySpoliationStatute of LimitationsStatute of Limitations Exceptions
Health Insurance SubrogationHealth and Disability Insurance
InvestigationAdmissibility of Expert TestimonyPre-Suit Disclosure of Liability Policy Limits in Third-Party ClaimsRecording Conversations
Product Liability SubrogationProduct Liability Law
Property Subrogation“Matching Regulations” And Laws Affecting Homeowners Property ClaimsCondominium/C0-Op Waiver of Subrogation LawsDamage to Property Without Market ValueGeneral Contractor Overhead And Profit Payments In First-Party ACV Property Damage ClaimsLandlord/Tenant Subrogation
Subrogation GenerallyAnti-Subrogation RuleCriminal RestitutionMade Whole DoctrineMedical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Workers’ CompensationEmployee Leasing LawsHospital Lien LawsOCIP/CCIP Subrogation In Workers’ Compensation Construction CasesRecovery Of Increased Workers’ Compensation Premiums By EmployerWhich Workers’ Compensation “Benefits” Can Be Subrogated?Workers’ Compensation Subrogation Waiver EndorsementsWorkers’ CompensationWorkers’ Compensation Claims by Undocumented Employees
Automobile Insurance Subrogation
Automobile Total Loss Thresholds
Total Loss Formula (TLF). When a car is totaled according to § 40-3-2, the insurance company must pay the vehicle’s pre-loss ACV.
Vehicle is damaged to the extent that its restoration to an operable condition requires replacing two or more major component parts. This does not include any motor vehicle for which a total loss claim has been paid by an insurance company, which vehicle has sustained only cosmetic damage from causes other than fire or flood. Ga. Code Ann. § 40-3-2 (11).
Automobile and Property: No applicable statute, Administrative Code provision or case law exists. Georgia’s Department of Insurance orally takes the position that the policyholder should come first, but good customer service and insurance contract dictate.
Diminution of Value
First Party: The Georgia Supreme Court decided what is probably the seminal case in the country regarding first-party diminution in value cases. In State Farm Mut. Auto. Ins. Co. v. Mabry, 556 S.E.2d 114 (Ga. 2001), the court determined that the public policy of Georgia requires insurers to pay the diminished value, as well as the cost of repair of an auto, even if the insured does not make a claim for the diminished value, if the terms of the policy are like those of State Farm’s. The court held State Farm had a duty to evaluate all first-party physical damage claims for the existence of diminution in value. In an action by the owner of personal property, such as an automobile, to recover for loss or damage sustained by him because of a tortious injury thereto, the measure of damages is to be determined under general principles of law. The Mabry case determined that the difference in a car’s value before and after an accident also included the difference in the car’s reputational value before and after injury.
In a suit on a contract, as a policy of insurance, whereby the owner is insured against actual loss or damage to an automobile by collision, the measure of the insurer’s liability will be determined according to the terms of the contract. In a more recent case, the insured could seek both costs of repair to a building and any post-repair diminution in building’s value resulting from damage. Royal Capital Dev., LLC v. Maryland Cas. Co., 728 S.E.2d 234 (Ga. 2012).
Third Party: Damages to a motor vehicle may be proven either by showing difference between fair market value of vehicle before collision and market value after collision, or by proof of reasonable value of labor and material used for necessary repairs that are the direct and proximate result of collision, together with loss of use, plus the value of any permanent impairment in the value of the vehicle. Myers v. Thornton, 480 S.E.2d 334 (Ga. App.1997).
Georgia courts have found that in a third-party action “[t]he measure of damages in an action to recover for injuries to a motor vehicle… is the difference between the value of the vehicle before and after the collision or other negligence” or in a case where the owner repairs the vehicle, damage can be shown by “the reasonable value of labor and material used for the repairs and the value of any depreciation (permanent impairment) after the vehicle was repaired, provided the aggregate of these amounts does not exceed the value of the vehicle before the injury.” Perma Ad Ideas of Am., Inc. v. Mayville, 158 Ga. App. 707 (1981).
First Come, First Served: Subrogating Multiple Claims in Excess of Policy Limits
A liability insurance company may be liable for damages to its insured for failing to settle the claim of an injured person where the insurer is guilty of negligence, fraud, or bad faith in failing to compromise the claim. McCall v. Allstate Ins. Co., 10 S.E.2d 513 (Ga. 1984). In deciding whether to settle a claim within the policy limits, the insurance company must give equal consideration to the interests of the insured. Great American Ins. Co. v. Exum, 181 S.E.2d 704 (Ga. App. 1971). The insurer must afford the insured the same faithful consideration it gives its own interest. Southern General Ins. Co. v. Holt, 416 S.E.2d 274 (Ga. 1992).
Therefore, an insurance company faced with a demand involving multiple claimants can create a safe harbor from liability for an insured’s bad faith claim under Holt by meeting the portion of the demand over which it has control, thus doing what it can to effectuate the settlement of the claims against its insured. Cotton States Mutual Ins. Co. v. Brightman, 580 S.E.2d 519, 522 (Ga. 2003).
The Georgia Court of Appeals has said that a liability carrier can settle with one claimant, leaving inadequate limits for the other claimant. Miller v. Interlocal Risk Mgmt. Agency, 501 S.E. 2d 589 (Ga. App. 1998). The court concluded that the settlement would not have been in bad faith even if the insurer had settled without conferring with the other claimant.
Funeral Procession Traffic Laws
Georgia Code § 40-6-76 requires that the lead vehicle of a funeral procession be marked with a flag or other sign and that each vehicle operating behind it shall have their headlights on. Funeral processions have the right-of-way at intersections except when approached by an emergency vehicle or directed by a traffic officer. Any vehicle not in the procession may not interfere with the line of vehicles unless authorized to do so by a traffic officer. Ga. Code Ann. § 40-6-76 (2014).
Imputing Contributory Negligence of Driver to Vehicle Owner
Imputed Contributory Negligence Law: The contributory negligence of a permissive user of the owner’s vehicle is not imputed to the owner in an action by the owner against a third party, unless the owner had the ability to control and influence the driver’s conduct. Floyd v. Colonial Stores, Inc., 176 S.E.2d 111 (Ga. App. 1970); Hightower v. Landrum, 136 S.E.2d 425 (Ga. App. 1964).
Negligence is imputed if agency/ principal, parent child. Ga. Stat. §§ 51-2-1 and 51-2-2.
Vicarious Liability/Family Purpose Doctrine: To establish a claim under the Family Purpose Doctrine (1) defendant must own or have an interest in or control over the automobile; (2) defendant must have made the automobile available for family use; (3) driver must be a member of defendant’s immediate household; and (4) vehicle must have been driven with the permission or acquiescence of the defendant. Hicks v. Newman, 283 Ga. App. 352, 353, 641 S.E.2d 589 (2007).
Alternatively, some Georgia courts require (1) the owner must have given permission to a family member to drive the vehicle; (2) the owner must have relinquished control of the vehicle to the family member; (3) the family member must be in the vehicle; and (4) the vehicle must be engaged in a family purpose. Danforth v. Bulman, 276 Ga. App. 531, 532(1), 623 S.E.2d 732 (2005).
Sponsor Liability for Minor’s Driving: No Sponsorship Liability Statute.
Laws Regarding Using Cell Phones/Headphones/Texting While Driving
Cell Phone/Texting: No driver with an instruction permit or a Class “D” license who is under the age of 18 may operate a cell phone while driving, except for emergency situations, while the vehicle is parked, or reporting a situation that the operator feels is unsafe for his or her personal safety. O.C.G.A. § 40-6-241.1.
Texting, watching video, and internet use is banned while holding the phone. Only “hands-free” use allowed; which means it cannot be on lap or on shoulder. A driver cannot reach for a device if he cannot maintain seated position. Can use phone if “lawfully parked.” (House Bill 673); O.C.G.A. § 40-6-240.
Other Prohibitions: No one can operate a motor vehicle while wearing a headset or headphones which would impair the driver’s ability to hear or any device that impairs vision. O.C.G.A. § 40-6-250.
House Bill 673 became effective on July 1, 2018 and requires drivers to use hands-free technology when using cellphones and other electronic devices. Previous law said it was okay to dial and hold phone, but not text; however, it was impossible to enforce because the police couldn’t tell what the driver was doing.
Loss Of Use
Loss of Use: Yes. Recovery for loss of use of the insured vehicle (the time insured was deprived of its use) is appropriate. Atlanta Furniture Co. v. Walker, 181 S.E. 498 (Ga. 1935). However, “the difference in ascertainment of damages as between a total loss and a repairable vehicle serves to provide fair, reasonable, and adequate compensation for the [damage] inflicted in that the maximum recovery for a repairable automobile including loss of use may not exceed [the fair market] value before the [damage].” (Emphasis supplied.) Firestone Tire, etc., Co. v. Jackson Transp. Co., 191 S.E.2d 110 (Ga. 1972); Boral Bricks, Inc. v. Old S. Transp. Mgmt., Inc., 402 S.E.2d 777, 777–78 (Ga. App. 1991). While hire of a substitute vehicle is an acceptable value of property damage claimed, courts have not illustrated whether that vehicle must actually be hired. Archer v. Monroe, 302 S.E.2d 583, 585 (Ga. App. 1983). There is no recovery for loss of use when a vehicle has been substantially destroyed or is not substantially repairable. Boral Bricks, Inc. v. Old South Transp. Management, Inc., supra.
Lost Profits: Yes. If there is a reasonably accurate calculation. Lost profits of a commercial venture are not recoverable if they are too speculative, remote, and uncertain. However, lost profits are capable of recovery if a business can perform a “reasonably accurate computation.” Businesses with clearly defined experience as to profit and loss will generally be able to accurately compute their lost profits, while a new business will not, due to a lack of such a track record. Molly Pitcher Canning Co. v. Cent. of Ga. Ry. Co., 253 S.E.2d 392 (Ga. App. 1979).
Comments: Evidence of rental value must not be based upon hearsay. Columbus Dodge, Inc. v. Garlock, 266 S.E.2d 311, 313 (Ga. App. 1980).
Med Pay/PIP Subrogation
Med Pay: No direct subrogation against third-party. O.C.G.A. § 33-24-56.1(e). Reimbursement from insured is allowed if insured is made whole and carrier contributes pro-rata to attorney’s fees. O.C.G.A. § 33-24-56.1(b). Insured must give ten (10) days notice of settlement or trial and Med Pay carrier must provide itemized payments. O.C.G.A. § 33-24-56.1(g).
PIP: Georgia repealed its no-fault scheme in 1991, but it still distinguishes between Med Pay and PIP coverage. PIP subrogation was once allowed if one of the vehicles involved weighed more than 6,500 pounds. Section 33-34-3(d)(1) used to provide that a PIP carrier was not be subrogated to the rights of the insured “except in those motor vehicle accidents involving two or more vehicles, at least one of which is a motor vehicle weighing more than 6,500 pounds unloaded, but it was amended to remove this exception. PIP reimbursement is now governed under the same rules and limitations as Med Pay subrogation.
An action to recover amounts paid out on a personal injury claim must be brought in the name of the insured, who is the real party in interest. O.C.G.A. § 44-12-24; State Farm Mut. Auto. Ins. Co. v. Cox, 515 S.E.2d 832 (Ga. 1999).
Made Whole: Can be overridden with Plan language. Duncan v. Integon Gen. Ins. Co., 482 S.E.2d 325 (Ga. 1997).
Statute of Limitations: The two (2) year personal injury statute of limitations runs from the date of the insured’s accident. O.C.G.A. § 9-3-33 (1982).
Owner Liability For Stolen Vehicles
Key In The Ignition Statutes: N/A
Common Law Rule: Mere ownership of motor vehicle does not create liability upon owner for damage sustained in collision involving the vehicle. Liability cannot be imputed to a vehicle owner for injuries caused by a thief, unless the vehicle owner had actual knowledge or the ability to reasonably anticipate the taking of the vehicle. J.C. Lewis Motor Co. v. Giles, 194 Ga. App. 472, 391 S.E.2d 19 (1990); Price v. Big Creek of Georgia, Inc., 191 Ga. App. 534, 534, 382 S.E.2d 356, 357 (1989); Robinson v. Pollard, 205 S.E.2d 86 (Ga. App. 1974).
Payment of Sales Tax Vehicle Total Loss
First-Party Claims: Insurer must (1) offer a cash equivalent settlement based upon the ACV of a “comparable auto” including all applicable taxes and other fees, or (2) offer a replacement auto including all applicable taxes, license fees and other fees. Ga. Comp. R. & Regs.§ 120-2-52-.06.
Third-Party Claims: No applicable statute, case law, or regulation governing recovery of sales tax. However, per O.C.G.A 51-12-7, “In all cases, necessary expenses consequent upon an injury are a legitimate item in the estimate of damages.”
Pedestrian and Crosswalk Laws
O.C.G.A. § 40-6-91: Vehicles must stop for pedestrians on or near vehicle’s half of crosswalk. Pedestrians must not leave curb when cars are too close to stop in time.
O.C.G.A. § 40-6-92: Pedestrians must yield to cars when outside of crosswalks. No crossing diagonally. At intersections with traffic signals, pedestrians must use crosswalk to cross.
Summary: Instructions to jury about pedestrian duty to yield outside of crosswalk was proper in action for injuries to three-year-old. Lewis v. Noonan, 142 Ga. App. 654, 236 S.E.2d 900 (1977).
Rental Car Company Physical Damage and Loss of Use Claims
Recovery From Renter: Recovery of physical damage and loss of use are not prohibited or otherwise regulated. Terms of rental agreement control. Collision Damage Waivers not regulated.
Recovery From Third-Party: Loss of use and loss of profits recoverable generally, but nothing specific with regard to car rental companies. Recovery for loss of use of the insured vehicle (the time insured was deprived of its use) is appropriate. Atlanta Furniture Co. v. Walker, 181 S.E. 498 (Ga. 1935); Lamb v. Mathis, 359 S.E.2d 214 (Ga. 1987). Lost profits of a commercial venture are not recoverable if they are too speculative, remote, and uncertain. However, lost profits are capable of recovery if a business can perform a “reasonably accurate computation.” Businesses with clearly defined experience as to profit and loss will generally be able to accurately compute their lost profits, while a new business will not, due to a lack of such a track record. Molly Pitcher Canning Co. v. Cent. of Ga. Ry. Co., 253 S.E.2d 392 (Ga. App. 1979).
Rental Car Company’s Liability Insurance Primary or Excess
Summary: The car rental company is excess to the liability coverage of the renter. Ga. Code § 40-9-102; A. Atlanta Autosave v. Generali, 498 S.E.2d 278 (Ga. App. 1999). Under § 40-9-102, the renter’s liability coverage is primary in the case of liability arising from the use of the rental car. Jordan v. Spirit Rent-A-Car, 555 SE.2d 734 (Ga. App. 2001). Where an accident is the fault of an additional renter authorized to drive the vehicle, but not a signatory to the rental contract, the court held that the carrier for the additional driver was not obligated to cover the loss. Thompson v. Enterprise Leasing Company of Georgia, 522 S.E.2d 670 (Ga. App. 1999); Zurich American Ins. Co. v. General Car & Truck Leasing System, Inc., 574 S.E.2d 914 (Ga. App. 2002).
Slower Traffic Keep Right
Statute: O.C.G.A. § 40-6-40(a) and (b), O.C.G.A. § 40-6-184 and O.C.G.A. § 40-6-52
Summary: Georgia requires motorists to drive in the right lane, except when overtaking and passing another vehicle proceeding in the same direction; when an obstruction exists; when the roadway is divided into three marked lanes for traffic; or when the roadway is restricted to one-way traffic. Slower traffic must keep right. Trucks equipped with more than six wheels (except buses and motor coaches) must use designated lanes. If no lanes are designated, and two or three lanes are available, trucks may not use far left lane, except to pass or turn left. Slower vehicles in left lane must yield to faster vehicles. Any vehicle proceeding at less than the normal speed of traffic must be driven in the right-hand lane. No person shall drive a vehicle at such a slow speed as to impede traffic.
Sudden Medical Emergencies While Driving
Act of God Defense. The driver of an automobile who suffers an unforeseeable illness which causes him to suddenly lose consciousness and control of the automobile is not negligent. Eatmon v. Weeks, 746 S.E.2d 886, 889 (Ga. 2013); Halligan v. Broun, 645 S.E.2d 581 (Ga. 2007).
Even if driver has suffered similar lose of consciousness and has received medical treatment for it in the past, it is a question for the jury if such knowledge combined with such acts constitutes negligence. Co-op Cab Co. v. Arnold, 126 S.E.2d 689 (Ga. 1962).
Suspension of Drivers’ Licenses
Administrative Suspension: Georgia Department of Driver Services can suspend a driver’s license if a driver is convicted of driving without insurance. https://dds.georgia.gov/suspensions-and-revocations. Driver can apply for reinstatement after sixty (60) days, following payment of $200 (first offense) or $300 (second offense or more). https://dds.georgia.gov/reinstatement-fees-and-payment-options.
Judgment: When a judgment is unsatisfied for thirty (30) days, the judgment creditor can request the court to forward a certified copy of the judgment to the Department within thirty (30) days. O.C.G.A. § 40-9-61. The judgment suspension will continue until the judgment is satisfied. O.C.G.A. § 40-9-62.
Contact Information: State of Georgia, Department of Transportation, Dept. of Driver’s Services, P.O. Box 80447, 2206 Eastview Parkway, Conyers, GA 30013, (678) 413-8400, http://www.dds.ga.gov/.
Use of Non-Original Equipment Manufacturer (OEM) Aftermarket Crash Parts in Repair of Damaged Vehicles
Authority: O.C.G.A. § 33-6-5; GA ADC § 120-2-52-.05.
Summary: All non-OEM parts must be marked with the logo, identification number, or name of manufacturer and it must be visible after installation, whenever practicable. The insurer and repair shop must identify non-OEM parts in the estimate. Additionally, they must include a disclosure statement stating that the manufacturer or distributor of the part warrants the non-OEM parts, not the vehicle manufacturer.
Federal , State, and Local Governmental Entities
Muncipal/County/Local Governmental Immunity and Tort Liability
Liability of Municipal Corporations For Acts or Omissions: O.C.G.A. §§ 36-33-1 to 36-33-6. In absence of liability insurance, municipality (city, town, or village) is immune from liability in all tort claims for injury except as otherwise provided.
Notice Deadlines: Notice of Claim must be presented within six (6) months to governing authority of municipality (12 months for county). Action on the notice of claim must be taken by the municipality within 30 days. The running of the statute of limitations is suspended during the time that the demand for payment is pending before such authorities without action on their part. O.C.G.A. § 36-33-5. Jurisdiction is in state or superior court where local government entity resides. O.C.G.A. § 36-92-4.
Claims/Action Allowed: (1) Immunity for governmental acts (decision to erect traffic sign, construction and maintenance of sewer system, operation of police and fire). (2) Immunity for discretionary acts unless if malice intent (act not required by statute to perform, decision not to inspect sidewalk, police pursuit). O.C.G.A. § 36-33-2. (3) Liability for ministerial acts (corporate gain or profit, electric power supply, buses, park, maintaining streets negligence in the execution of plans or specifications, nuisance). O.C.G.A. § 36-33-1.
Comments/Exceptions: Municipality waives immunity by the purchase of liability insurance. O.C.G.A. § 36-33-1. Owens v. City of Greenville, 722 S.E.2d 755 (Ga. 2012); O.C.G.A. §§ 33-24-51, 36-92-2, and 36-33-1. Immunity waived for operation of motor vehicles to the greater of policy limits or statutory limits. O.C.G.A. §§ 33-24-51 and 36-92-1.
Motor Vehicles: $500,000 Per Person. $700,000 Per Occurrence. $50,000 Property Damage. O.C.G.A. § 36-92-2. No Punitive Damages. O.C.G.A. § 36-92-4.
State Sovereign Immunity And Tort Liability
Tort Claims Act: Georgia Tort Claims Act.
Sovereign immunity is waived for torts of State officers and employees while acting within the scope of their employment and shall be liable for such torts in the same manner as a private individual would be liable under like circumstances. O.C.G.A. §§ 50-21-20, 50-21-37 (1992).
Notice Deadlines: Written notice of a claim shall be given within 12 months of the date the loss. O.C.G.A. § 50-21-26.
Claims/Actions Allowed: The State is subject to liability for its employee’s negligence when operating a motor vehicle if the damage was not caused from a method of providing police protection. Georgia Dep’t of Pub. Safety v. Davis, 285 Ga. 203, 676 S.E.2d 1 (2009).
Comments/Exceptions: Georgia does not waive immunity for losses arising from:
(1) an act or omission by a State employee exercising due care in the execution of a statute, regulation, or rule;
(2) the exercise or the failure to exercise a discretionary function;
(3) the collection of any tax;
(4) legislative or judicial action; and
(5) methods of providing law enforcement.
See O.C.G.A. § 50-21-24 for other exceptions.
Damage Caps: Except as provided, Georgia is not liable for damages exceeding $1 million for single occurrence and the State’s liability per occurrence shall not exceed $3 million. O.C.G.A. § 50-21-29. No punitive damages against the State. O.C.G.A. § 50-21-30.
General Tort Laws/Statutes
Does not apply to any obligation under workers’ compensation or any type of coverage or insurance issue concerning workers’ compensation.
Pure Several Liability. If some tortfeasors settle and others do not, the settling tortfeasor’s fault may be considered, but no setoff is permitted, in assessing the non-settling tortfeasors’ percentage of the fault. The apportionment statute (O.C.G.A. § 51-12-33) “flatly states that apportioned damages shall not be subject to any right of contribution.” McReynolds v. Krebs, 725 S.E.2d 584 (Ga. 2012).
There is generally no right to contribution between the co-defendants when fault is apportioned by a jury or judge. This is because each is liable only for its proportionate share. O.C.G.A. § 51-12-33(b) (apportionment statute) flatly states that apportioned damages “shall not be subject to any right of contribution.” O.C.G.A. § 51-12-33(b); McReynolds v. Krebs, 725 S.E.2d 584 (Ga. 2012). Any settling tortfeasors’ fault is considered in assessing the non-settling tortfeasors’ portion of fault, but no setoff is permitted for the settlement amount. O.C.G.A. § 51-12-33(b); McReynolds v. Krebs, 725 S.E.2d 584 (Ga. 2012). However, the enactment of the apportionment statute did not abolish the right of contribution between settling joint tortfeasors when there has been no apportionment of damages by a trier of fact. Where parties settle voluntarily and a jury does not apportion damages, the right of contribution still exists. Zurich American Ins. Co. v. Heard, 740 S.E.2d 429 (Ga. App. 2013).
The twenty (20) year statute of limitations for contribution actions begins to run when judgment is entered or settlement is made. Independent Mfg. Co., Inc. v. Automotive Products, Inc., 233 S.E.2d 874 (Ga. App. 1977).
Contributory Negligence/Comparative Fault
Modified Comparative Fault. 50% Bar. Damaged party cannot recover if it is 50% or more at fault. If 49% or less at fault, it can recover, although its recovery is reduced by its degree of fault. Total liability will be reduced by plaintiff’s percentage of fault, as long as plaintiff is less than 50% at fault. O.C.G.A. §§ 51-11-7 and 51-12-33.
Dog Bite Laws
Dog owner who keeps a “vicious or dangerous” animal and allows it to run free, injuring someone who does not provoke it, may be liable in damages. However, this section doesn’t apply to dogs subject to § 4-8-4(b). Ga. Code Ann. § 51-2-7.
Establishes minimum standards for the control and regulation of dogs. Provides for the identification of dangerous/vicious dogs, requires registration for the possession of such dogs and the owner to maintain an enclosure, post warning signs, have a microchip implanted, and provide $50,000 in liability insurance. Ga. Code Ann. §§ 4-8-1, 4-8-4, 4-8-5, 4-8-20 to 4-8-32.
Economic Loss Doctrine
Intermediate Rule (via statute). Tort v. Contract: When a party to a written contract can recover economic damages from the other contracting party for mere negligence in carrying out its contractual duties is an issue that has produced conflicting case decisions. In Long v. Jim Letts Oldsmobile, Inc., 217 S.E.2d 602 (Ga. App. 1975), the court held that negligence in the performance of a contract may give rise to a tort action. In Mauldin v. Sheffer, 150 S.E.2d 150 (Ga. App. 1966), the court held that in order to maintain an action in tort because of a breach of duty growing out of a contract, the breach must be shown to have been a breach of a duty imposed by law and not merely the breach of a duty imposed by the contract itself.
Product Liability: Georgia has enacted its own statutory product liability law, rather than relying on common law or § 402A of the Restatement. O.C.G.A §51-1-11. No recovery in tort is allowed when damage is to the product only, unless there is personal injury or damage to “other property”. Busbee v. Chrysler Corp., 524 S.E.2d 539 (Ga. App. 1999). Georgia Courts have held that the ELD does not apply to claims where a plaintiff seeks to recover damages for harm to his person or property. Bates & Associates, Inc. v. Romei, 426 S.E.2d 9191 (Ga. App. 1993) (“The rule does not prevent a tort action to recover for injury to persons or to property other than the product itself, because the duty breached in such situations generally arises independent of the contract.”). This exception exists when there is a sudden and calamitous event that causes risk of injury to persons or other property. Vulcan Materials Co. v. Driltech, Inc., 306 S.E.2d 253 (Ga. 1983). Another exception exists for misrepresentation relied on by the purchaser. Robert & Co. Assoc. v. Rhodes-Haverty Partnership, 300 S.E.2d 503 (Ga. 1983). A plaintiff can recover in tort for personal injuries and damage to other property, but recovery for damage to the product itself is not allowed. Jim Letts, supra.; Flintkote Co. v. Dravo Corp., 678 F.2d 942 (11th Cir. 1982); Vulcan Materials, supra. For example, if a product simply stops working, the owner cannot maintain a negligence claim against the seller for diminution in value, repair costs, and loss of use. Jim Letts, supra. The owner is left with only a contract warranty action to obtain compensation. There is also an accident exception to the general rule that an action in negligence does not lie absent personal injury or damage to property other than to the allegedly defective product. Vulcan Materials, supra. There is a general duty under tort law, independent of any contract, to avoid causing “a sudden and calamitous event which, although it may only cause damage to the defective product itself, poses an unreasonable risk of injury to other persons or property.” Id. In Vulcan Materials, a failed hydraulic tube leaked hydraulic fluid and caused a sudden fire when ignited by the hot engine surface. This qualified as a sudden and calamitous event which the court held could not be construed as merely a “defect of quality, evidenced by internal deterioration or breakdown [which would be] assigned to the economic loss category.” Id.
Independent Duty Exception. Over time, the courts have generally prohibited parties to a contract from recovering in negligence for economic losses resulting from negligent performance of contractual duties but allowed such claims where they were premised on a professional or “special” relationship between the parties. Orkin Exterminating Co. v. Stevens, 203 S.E.2d 587 (Ga. App. 1973) (pest exterminator); Mauldin, supra. (mechanical engineer). These special contractual relationships include, for example, those between principal and agent, bailor and bailee, attorney and client, physician and patient, carrier and passenger or shipper, and master and servant. Bulmer v. Southern Bell Tel. & Tel. Co., 317 S.E.2d 893 (Ga. App. 1984). Such negligence claims are allowed, despite arising from a contractual duty, because the law imposes a duty of care in these special relationships which is separate from the duty imposed by the contract. Georgia law recognizes an exception to the ELD for injuries that occur independently of a contract. Hanover Ins., Co. v. Hermosa Constr. Grp., LLC, 57 F. Supp. 3d 1389 (N.D. Ga. 2014). Finally, Georgia has recognized exceptions to the economic loss rule in (1) cases of misrepresentation/fraud, and (2) where the conduct of the defendant poses an unreasonable risk of injury to other persons or property (referred to in product liability cases as the “accident exception”). Home Depot U.S.A., Inc. v. Wabash Nat. Corp., 724 S.E.2d 53, 59 (Ga. Ct. App. 2012); Advanced Drainage Sys., Inc. v. Lowman, 437 S.E.2d 604, 607 (Ga. Ct. App. 1993).
The Georgia Supreme Court explained the distinction between actions based purely on contract duties and those that invoke independent duties giving rise to a remedy in tort:
It is axiomatic that a single act or course of conduct may constitute not only a breach of contract but an independent tort as well, if in addition to violating a contract obligation it also violates a duty owed to plaintiff independent of contract to avoid harming him. Such an independent harm may be found because of the relationship between the parties, or because of defendant’s calling or because of the nature of the harm.
However, not all breaches of contract are also independent torts: ‘… where defendant’s negligence ends merely in non-performance of the contract and where defendant is not under any recognized duty to act apart from contract, the courts generally still see no duty to act affirmatively except the duty based on – and limited by – defendant’s consent.’ 2 Harper and James, Torts, p. 1050, s 18.6. In those circumstances, an action in tort may not be maintained for what is a mere breach through non-action or through ineffective performance (which is the same thing) of a contract duty – the duty must arise independent of contract to constitute a tort. Thus, to constitute a tort the duty must arise independent of the contract. Sheppard v. Yara Eng’g Corp., 281 S.E.2d 586 (Ga. 1981).
Willful Misconduct. Parents liable for medical expenses or property damage caused by willful or malicious act of child. O.C.G.A. § 51-2-3.
The limits of liability are $10,000 plus costs.
Child must be under 18-years-old.
*Every person is liable for torts committed by his wife or child by his command or in the prosecution and within the scope of his business, whether negligent or intentional. O.C.G.A. § 51-2-2.
Third-Party Tort of Spoliation: The Georgia Court of Appeals declined to recognize an independent third-party tort for spoliation of evidence. Owens v. Am. Refuse. Sys., Inc., 244 Ga.App. 780, 536 S.E.2d 782 (Ga. 2000).
First-Party Tort of Spoliation: In Gardner v. Blackston, 185 Ga.App. 754, 365 S.E.2d 545 (Ga. 1988), the Court stated in dicta that Georgia law does not recognize spoliation of evidence as a separate tort. In Sharpnack v. Hoffinger, 231 Ga.App. 829, 499 S.E.2d 363 (Ga. 1998), the Court again reviewed the issue, but since the Court had already determined that the plaintiff in the case had assumed the risk of his injury, he could not establish a meaningful link between his underlying claims and the alleged spoliation. Therefore, the appellate court affirmed the grant of summary judgment.
Sanctions: Georgia courts have the authority to impose sanctions to remedy the prejudice from the spoliation of evidence. R.A. Siegel Co. v. Bowen, 539 S.E.2d 873, 877 (Ga. Ct. App. 2000). Sanctions range from adverse inference, dismissal and exclusion of evidence. Chapman v. Auto Owners Ins. Co., 469 S.E.2d 783, 784 (Ga. Ct. App. 1996); Cavin v. Brown, 538 S.E.2d 802, 804 (Ga. Ct. App. 2000).
Courts will look to a variety of factors in determining which sanctions to impose, including: (1) whether the party seeking sanctions was prejudiced as a result of the destruction of the evidence; (2) whether the prejudice could be cured; (3) the practical importance of the evidence; (4) whether the party that destroyed the evidence acted in good or bad faith; and (5) the potential for abuse of expert testimony about the evidence was not excluded. Bridgestone/Firestone North Am. Tire, L.L.C. v. Campbell, 574 S.E.2d 923, 926 (Ga. Ct. App. 2002); Chapman, 469 S.E.2d at 785.
Statute of Limitations
Personal Property4 YearsO.C.G.A. §§ 9-3-30, 9-3-31*
Personal Injury/Death2 YearsO.C.G.A. § 9-3-33
Breach of Contract/Written6 YearsO.C.G.A. § 9-3-24
Breach of Contract/Oral4 YearsO.C.G.A. § 9-3-25
Breach of Contract/U.C.C./Goods4 YearsO.C.G.A. § 11-2-725
Statute of Repose/Products10 YearsO.C.G.A. § 51-1-11(b)(2)**
Statute of Repose/Real Property8 YearsO.C.G.A. § 9-3-51***
Breach of Warranty/U.C.C.4 YearsO.C.G.A. § 11-2-725
Workers’ Comp Third Party Case2 YearsO.C.G.A. § 34-9-11.1
Strict Product Liability/Personal Injury2 YearsO.C.G.A. § 9-3-33****
Strict Product Liability4 YearsO.C.G.A. § 9-3-30, 31
Statute of Limitations Exceptions
*SOL for damage to home (assuming original owner) begins to run from date of substantial completion even though this means SOL might run before accident occurs. Corp. of Mercer Univ. v. Nat. Gypsum Co., 368 S.E.2d 732 (Ga. 1988).
**10 Years after date of first sale – not applicable to warning claims. O.C.G.A. § 51-1-11(b)(2). However, a claim involving damage caused by a product’s component part must be filed within 10 years after the part was incorporated into the final design of the product by the manufacturer. Johnson v. Ford Motor Co., 637 S.E.2d 202 (Ga. App. 2006).
***8 Years from substantial completion to improvement to real property. O.C.G.A. § 9-3-51. If claim occurs in 7th or 8th year after substantial completion must be brought within two (2) years of injury.
****1 Year from date of death.
Health Insurance Subrogation
Health and Disability Insurance
Statute of Limitations: 2 Years. O.C.G.A. § 9-3-33.
Subrogation of Medical Benefits are allowed. O.C.G.A. § 33-24-56.1. Permits subrogation only where the insured’s recovery exceeds the sum of all categories of damages. Does not apply to “Accident Only” policies, § 33-1-2(3) or out-of-state policies not approved by the Georgia Insurance Commissioner, § 33-24-2(2). See e.g., Atlantic Specialty Ins. Co. v. Anderson, 2017 WL 2709825 (Gwinnett County, June 20, 2017).
Subrogation of Disability Benefits are allowed. O.C.G.A. § 33-24-56.1; Smith v. Life Ins. Co. of North Am., 466 F.Supp.2d 1275 (N.D. Ga. 2006). Does not apply to “Accident Only” policies, §33-1-2(3) or out-of-state policies not approved by the Georgia Insurance Commissioner, § 33-24-2(2). See e.g., Atlantic Specialty Ins. Co. v. Anderson, 2017 WL 2709825 (Gwinnett County, June 20, 2017).
Made Whole Doctrine applies. Does not apply to “Accident Only” policies, §33-1-2(3) or out-of-state policies not approved by the Georgia Insurance Commissioner, §33-24-2(2). See e.g., Atlantic Specialty Ins. Co. v. Anderson, 2017 WL 2709825 (Gwinnett County, June 20, 2017). Common Fund Doctrine applies. O.C.G.A. § 33-24-56.1(b)(2).
Admissibility of Expert Testimony
Admissibility Standards: Daubert
Case/Statutory Law: O.C.G.A. § 24-7-702
In Moore v. Intuitive Surgical, Inc., 995 F.3d 839 (11th Cir. 2021), the court found that surgeon/medical expert who had not used the specific surgical tool involved in the case was not automatically disqualified under the Daubert expert admissibility standard due to his lack of experience using the tool in prior surgeries. The “exacting analysis” which judges perform on the foundation of an expert’s opinion, in determining admissibility of his testimony under Daubert, applies only to an experts’ methodology in reaching his opinion and therefore is relevant to only the reliability prong of the analysis.
In assessing admissibility of expert opinion, trial court may not exclude otherwise sufficient expert opinion simply because it believes that opinion is not—in its view—particularly strong or persuasive; weight to be given to admissible expert testimony is matter for jury. It is not the role of the trial court to make ultimate conclusions as to the persuasiveness of the proffered evidence, and a trial court’s gatekeeper role under Daubert is not intended to supplant the adversary system or the role of the jury. Fireman’s Fund Ins. Co. v. Holder Constr. Group, LLC, 2022 WL 223665 (Ga. App. 2022).
Pre-Suit Disclosure of Liability Policy Limits in Third-Party Claims
Duty To Disclose: Yes. Ga. Stat. § 33-3-28(a)(1).
Failure To Disclose A Basis For Bad Faith: No Information.
Comments: Both carriers and insureds must disclose policy information. Within 60 days after written request, carrier must provide “a statement, under oath, of a corporate officer or the insurer’s claims manager stating with regard to each known policy of insurance issued by it, including excess or umbrella insurance, the name of the insurer, the name of each insured, and the limits of coverage.” The insurer may also send a copy of the declarations page of each applicable policy in lieu of providing the requested information. Upon receipt of this request, the insurer must immediately notify the insured, insured driver, and/or any other potential person or entity that could be named in a potential lawsuit.
One-Party Consent: An individual has the right to record or disclose the contents of an electronic, oral or wire communication that they are a party to or if one of the parties has given prior consent to the recording of said communications. Ga. Code Ann. § 16-11-66(a); Ga. Code Ann. § 16-11-62.
Product Liability Subrogation
Product Liability Law
Statute of Limitations/Repose: 2 years for personal injury and wrongful death. O.C.G.A. § 9-3-33. Discovery Rule applies. Statute of Repose is 10 years. O.C.G.A. § 51-1-11(b)(2).
Liability Standards: Negligence, Strict Liability, Warranty.
Fault Allocations: Modified Comparative. O.C.G.A. §§ 51-12-31, 51-12-33 (2011).
Non-Economic Caps/Limits On Actual Damages: No.
Punitive Y/N and Limits: Yes (Limits).
Heeding Presumption?: Unresolved.
Innocent Seller Statute: No.
Joint and Several Liability: No. O.C.G.A. § 51-12-33.
Available Defenses: Assumption of Risk; Misuse; Alteration; Learned Intermediary; State of the Art; Compliance With Government Standards; Presumption; Sophisticated User.
Restatement 2nd or 3rd?: Restatement 3rd.
“Matching Regulations” And Laws Affecting Homeowners Property Claims
Caselaw: In case where insurer conceded that four shingles needed to be replaced but insured wanted entire roof replaced in order to match, the homeowner was not entitled to invoke the policy’s appraisal provision because there was a question of coverage, rather than the amount owed. Lam v. Allstate Indem. Co., 755 S.E.2d 544 (Ga. App. 2014).
Condominium/C0-Op Waiver of Subrogation Laws
Associations must have casualty insurance policies and liability insurance policies. Subrogation waivers are not mentioned in the statute. O.C.G.A. § 44-3-107.
Damage to Property Without Market Value
Service Value: “Our view, and we so hold, is that the necessary expense in restoring such pole is the proper measure of damages for its wrongful destruction.” Horton v. Georgia Power Co., 254 S.E.2d 479 (Ga. Ct. App. 1979).
Intrinsic Value: “But while the rule is that the actual value to the owner can be recovered, it is also true that there can be no recovery for the sentimental value of the lost article.” Cherry v. McCutchen, 16 S.E.2d 167 (Ga. Ct. App. 1941).
Sentimental Value: “But while the rule is that the actual value to the owner can be recovered, it is also true that there can be no recovery for the sentimental value of the lost article.” Cherry v. McCutchen, 16 S.E.2d 167 (Ga. Ct. App. 1941).
General Contractor Overhead And Profit Payments In First-Party ACV Property Damage Claims
Payment And Depreciation OF GCOP/Sales Tax: No applicable case law, statutes, administrative rules, or other guidance with regard to the calculation and/or depreciation of GCOP.
Georgia has avoided per se rules and taken a more flexible case-by-case approach, holding that a tenant’s liability to the landlord’s insurer for negligently causing a fire depends on the intent and reasonable expectations of the parties to the lease as ascertained from the lease as a whole. Tuxedo Plumbing & Heating Co. v. Lie-Nielsen, 262 S.E.2d 794 (Ga. 1980).
An insurer cannot subrogate against its own insured or against those deemed to be a conditional insured or co-insured under the policy of an insurance. AEW No. 2 Corp. v. Fed. Ins. Co., 603 S.E.2d 22 (Ga. Ct. App. 2004). Insurers cannot sue a co-insured party indirectly by requiring one co-insured party to sue the other and remit any winnings to the insurer. E. C. Long, Inc. v. Brennan’s of Atlanta, Inc., 252 S.E.2d 642 (Ga. Ct. App. 1979). An insured lessor, that paid its insurance claim for damages to a trailer while used by a lessee, could not maintain a subrogation suit on behalf of its insurer against the lessee, who was a co-insured. Curles v. U.S. Fid. & Guar. Co., 403 S.E.2d 458 (Ga. Ct. App. 1991).
Per Georgia statute, the courts have the authority to order criminal restitution paid “by those found guilty of crimes or adjudicated as having committed delinquent acts” to the “victims” of those acts. O.C.G.A. § 17-14-1 (West).
The statute also specifically includes as a possible “victim” “[a]ny… public or private corporation… suffering damages caused by an offender’s unlawful act.” O.C.G.A. § 17-14-2 (West). Case law affirms the statute and states that “in cases where insurers have paid for crime-related losses, the trial courts have authority to order restitution be paid to the insurer.” In The Interest of C.B., 221 Ga. App. 102, 470 S.E.2d 493, 494 (1996).
Made Whole Doctrine
Georgia adheres to the Made Whole Doctrine. In fact, in 1997, the Supreme Court articulated the rationale underlying what it refers to as the “Full Compensation” Rule, stating: “Where the insurer or the insured must go unpaid to some extent, the loss should be borne by the insurer, since the insurer has already been paid a premium for assuming this risk and would have been obligated to pay medical expenses regardless of its insured’s negligence and regardless of whether a culpable third party could have been found.” Duncan v. Integon Gen. Ins. Corp., 482 S.E.2d 325 (Ga. 1997).
This “Full Compensation” Rule was codified a year later in § 33-24-56.1. In short, this statute provides that a benefits provider (which includes an automobile insurer which pays medical expenses) may provide for in its policy language and pursue reimbursement for such medical expenses from the injured party only if the injured party has received a recovery that “exceeds the sum of all economic and non- economic losses incurred as a result of the injury, exclusive of losses for which reimbursement may be sought under this Code section.” O.C.G.A. § 33-24-56.1(b) (1).
To further the purposes of this rule, the legislature provided that subrogation for medical expenses and disability payments by a benefit provider directly against the tortfeasor is prohibited. O.C.G.A. § 33-24-56.1(e). Thus, an insured is not put in a position of contracting away his or her right to sue after being compensated by the insurer for medical expenses and disability payments. The Supreme Court has said that this statute renders unenforceable conventional subrogation provisions in a policy that permits reimbursement from the insured when the insured is not fully compensated. Davis v. Kaiser Found. Health Plan, 521 S.E.2d 815 (Ga. 1999).
It is a question of law for the trial courts only to determine whether or not an insured has been fully and completely compensated. Liberty Mut. Ins. Co. v. Johnson, 535 S.E.2d 511 (Ga. App. 2000). Amazingly, neither party has a right to a jury determination of whether or not the Plan beneficiary has been made whole. Id. At least in the context of being made whole in a workers’ compensation third-party action, the trial court may not consider affirmative actions of contributory/comparative negligence/assumption of the risk (on the part of the employee in causing or contributing to his or her injury) in determining whether or not the employee has been fully and completely compensated for his injuries, because the employee’s total economic and non-economic losses make up the full and complete compensation unreduced by such defenses under the Act. Homebuilders Ass’n v. Morris, 518 S.E.2d 194 (Ga. App. 1999). To show how easy it is for parties to gerrymander a settlement and avoid contractual subrogation obligations, a Georgia Court of Appeals has held that where there is no breakdown as between economic and non-economic damages in a settlement or a special verdict, it is essentially “impossible to determine if the plaintiff has been fully compensated for his losses.” North Bros. Co. v. Thomas, 513 S.E.2d 251 (Ga. App. 1999).
Despite its hostility toward subrogation, Georgia law provides us with one of the few cases which helps subrogating insurers combat the Made Whole Doctrine across the country. A Plan beneficiary is presumed to be made whole if he voluntarily settles his or her case within policy limits, according to one federal district court decision. Thompson v. Fed. Express Corp., 809 F. Supp. 950, 954 (M.D. Ga. 1993).
A few other courts from other states have also followed suit implementing the logical conclusion that if a plaintiff settles his case, the amount of plaintiff’s damages is fully fixed by the settlement agreement entered into between the plaintiff and tortfeasor. Bell v. Fed. Kemper Ins. Co., 693 F. Supp. 446 (S.D. W.Va. 1988). The court may conclude that the settlement negotiations in the underlying action were conducted in an arm’s length manner, and that the plaintiff willingly entered into the settlement agreement. Therefore, after a settlement a plaintiff should be precluded from arguing that he was not fully compensated, and an insurer or health Plan may assert its subrogation claim free from the constraints of the Made Whole Doctrine. Id. A Minnesota Supreme Court has also held that once a party settles its claim, it cannot thereafter claim that it was not fully compensated. Illinois Farmers Ins. Co. v. Wright, 391 N.W.2d 519 (Minn. 1986). Clearly, if a jury determines the money necessary to make a plaintiff whole, then that is the amount which makes him whole as a matter of law. Bell, supra; United Pacific Ins. Co. v. Boyd, 661 P.2d 987 (Wash. 1983); Martine v. Hertz Corp., 103 F.3d 118 (4th Cir 1996). There is Georgia case law to the effect that the Made Whole Doctrine can be overridden by contract terms in a policy or Plan. Duncan, supra. In Duncan, the court did indicate that the policy would have to specifically reference the Made Whole Doctrine in order to be effective. However, two years later, the Georgia Supreme Court concluded that any policy provisions modifying the Made Whole Doctrine were unenforceable as a matter of public policy. Davis, supra. The court in Davis, referencing the passage of § 33-24-56.1, clarified that the “Complete Compensation” Rule is the public policy of Georgia and that any insurance policy provision which requires reimbursement or allows subrogation without regard to whether the insured is completely compensated is unenforceable because it violates public policy. Id.
However, where the subrogated UM insurer is exercising its subrogation rights by proceeding directly against the tortfeasor, rather than seeking reimbursement from the insured, the Made Whole Doctrine (Full Compensation Rule) in Georgia will not act to bar the insurer’s subrogation rights. Landrum v. State Farm Mut. Auto. Ins. Co., 527 S.E.2d 637 (Ga. App. 2000). This is because § 33-7-11(f) expressly grants the UM carrier the right to bring a subrogation claim against the tortfeasor, despite the “Full Compensation” Rule’s prohibition against same. The Made Whole Doctrine is not applicable unless there is a contest between the insured and insurer which could result in the insured going unpaid to some extent. Id.
The Georgia Supreme Court has also made clear that the Made Whole Doctrine cannot be used by a tortfeasor as a defense to a subrogation suit filed by the insurer. Landrum, supra. In order for the Made Whole Doctrine to apply, there must be a contest between the insured and insurer over a limited pool of funds which could result in the insured going unpaid to some extent. Georgia Cas. & Sur. Co. v. Woodcraft by MacDonald, Inc., 726 S.E.2d 793 (Ga. App. 2012).
Medical Expenses, Insurance Write-Offs, and The Collateral Source Rule
Collateral Source Rule: Georgia adheres to the common law CSR. Defendant may not present evidence of collateral benefits received by plaintiff and defendant may not take any credit or set-off toward his liability and damages for such payments. Hoeflick v. Bradley, 637 S.E.2d 832 (Ga. App. 2006). In 1987, Georgia passed § 51-12-1, which modified the CSR and allowed evidence of collateral sources. However, it was declared unconstitutional in 1991. Denton v. Con-Way Southern Express, 402 S.E.2d 269 (Ga. 1991), overruled on other grounds, Grissom v. Gleason, 418 S.E.2d 27 (Ga. 1992).
Recovery Of Medical Expenses Rule:
Private Insurance: A write-off or write-down of medical expenses is a collateral source. Olariu v. Marrero, 549 S.E.2d 121 (Ga. App. 2001). However, if plaintiff recovers a special verdict that awards damages for medical expenses previously written off by the defendant, the defendant is entitled to a set-off against the award of medical expenses in the verdict prior to the entry of the judgment in the amount of any write-off that the defendant made to the total medical expenses. Candler Hosp. v. Dent, 228 Ga .App. at 422, supra.
Medicare/Medicaid: Based on Olariu and Candler Hosp., Georgia courts would seemingly also exclude evidence of write-downs and/or write-offs by Medicare, Medicaid, or private insurance. CSR is applicable even where the benefit bestowed is gratuitous. Hoeflick v. Bradley, 637 S.E.2d 832 (Ga. App. 2006).
Assignment of Benefits to Insurer: An exception to CSR arises when the plaintiff/insured assigns cause of action to subrogated insurer, at which point any suit must be brought in the insurer’s name. Wardlaw v. Ivey, 676 S.E.2d 858 (Ga. App. 2009).
Employee Leasing Laws
Employers are immune from suit under the Exclusive Remedy Rule when utilizing employee leasing companies or temporary help agencies, provided that workers’ compensation benefits are provided to a worker by either the leasing employer or the employee leasing company. O.C.G.A. § 34-9-11(c).
Hospital Lien Laws
Statute: Georgia Code §§ 44-14-470 – 477. Hospitals and Nursing Homes.
Perfecting Lien: In order to protect a lien in Georgia, a provider shall:
(1) Not less than 15 days prior to the filing of the statement required by paragraph (2) of this act, provide written notice to patient, and to the best of their knowledge, the person, firm, corporations, and their insurers who may be liable for the injuries and shall contain a statement that the lien is not a lien against the patient or any other property or assets of patient, and is not evidence of patient’s failure to pay a debt. Notice shall be sent by first class and certified mail or statutory overnight delivery, return receipt requested. § 44-14-471(a)(1).
(2) The hospital shall file in the office of the clerk of the superior court of the county where the provider is located and, in the county, wherein the patient resides, if a resident of Georgia, a verified statement setting forth name and address of the patient as it appears on the provider’s records, name and location of provider, dates of admission and discharge, and amount claimed to be owed. The statement must be filed during the following time period: (A) if statement is filed by a hospital, nursing home, or provider of traumatic burn care medical practice, then statement shall be filed within 75 days after person has been discharged from facility, or (B) if statement is filed by physician practice, then statement shall be filed within 90 days after person first sought treatment from physician practice for the injury. § 44-14-471(a)(2).
Comments: The filing of claim or lien shall be notice thereof to all persons, firms, or corporations liable for damages, whether or not they received written notice provided for in this Code section. Failure to perfect such lien by timely complying with notice and filing provisions of paragraphs (1) and (2) of subsection (a) of this Code section shall invalidate such lien, except as to any person, firm, or corporation liable for damages, which receives prior to date of any release, covenant not to bring action, or settlement, actual notice of a notice and filed statement made under subsection (a) of this Code section, via hand delivery, certified mail, return receipt requested, or statutory overnight delivery with confirmation of receipt. § 44-14-471(b). No release of the cause of action or of any judgment shall affect the lien unless the lienholder releases the lien. § 44-14-473. The lien does not attach to any workers’ compensation benefits. § 44-14-474.
OCIP/CCIP Subrogation In Workers’ Compensation Construction Cases
OCIP Law: A premises owner is not entitled to statutory tort immunity, even if it purchases a wrap-up policy to provide workers’ compensation coverage for all on-site contractors. Pogue v. Oglethorpe Power Corp., 477 S.E.2d 107 (Ga. 1996).
Statutory Employer Law: Georgia’s exclusive remedy statute (O.C.G.A. § 34-9-11) creates three express exceptions to the employee’s right to sue a third party, granting immunity to: (1) employees of the same employer; (2) persons who provide workers’ compensation benefits under a contract with the employer; and (3) construction design professionals. Cotton v. Bowen, 524 S.E.2d 737 (Ga. 1999).
Comments: Georgia says that while the OCIP contract may require the owner to pay workers’ compensation premiums for employees of subcontractors, the contract does not meet the requirements of a workers’ compensation insurance policy. Therefore, no exclusive remedy protection. Pogue v. Oglethorpe Power Corp., 477 S.E.2d 107 (Ga. 1996).
Recovery Of Increased Workers’ Compensation Premiums By Employer
Recovery For Increased Premiums? No.
Statute/Case Law: Unique Paint Co. v. Wm. F. Newman Co., 201 Ga. App. 463, 411 S.E.2d 352, 353 (1991).
Rule Summary: Increased workers’ compensation premiums resulting from a third-party tortfeasor’s injuries to employees are harms that are not foreseeable or are otherwise too remote to be subject to liability.
Which Workers’ Compensation “Benefits” Can Be Subrogated?
No statute, regulation, or case decision on point. Section 34-9-11.1 describes the carrier’s subrogation interest as follows:
…the employer or such employer’s insurer shall have a subrogation lien, not to exceed the actual amount of compensation paid pursuant to this chapter…
Attorneys’ fees are capped at 25% of the claimant’s award or 25% of the employee’s weekly indemnity benefits. Ga. Code Ann. § 34-9-108. The fee is paid out of the recovery by the employee.
Workers’ Compensation Subrogation Waiver Endorsements
Subrogation Statute: O.C.G.A. § 34-9-11.1
Waiver Allowed? Yes. An insurer’s waiver of subrogation was upheld despite not being included in settlement documents between the claimant and the insurer. Employers Commercial Union Ins. Co. v. Wrenn, 208 S.E.2d 124 (Ga. App. 1974).
Effect Of Waiver Endorsement on Carrier’s Right To Assert A Lien On Claimant’s Recovery: The effect of a waiver of subrogation on the carrier’s rights, including its right to enforce its statutory lien, has not yet been decided.
Other Applicable Law: None.
Statute of Limitations: 2 Years. O.C.G.A. § 34-9-11.1.
Can Carrier Sue Third Party Directly: Yes, after 1 year.
Right to Intervene: Yes.
Recovery from UM/UIM Benefits: No.
Subrogation Against Medical Malpractice: Undecided.
Subrogation Against Legal Malpractice: Undecided.
Recovery Allocation/Equitable Limitations: Made Whole Doctrine codified. No lien against non-economic damages.
Employer Contribution/Negligence: The plaintiff’s recovery is reduced by the employer’s negligence.
Attorney’s Fees/Costs: Apportionment is based on services by the carrier and plaintiff’s attorney.
Future Credit: No.
Auto No-Fault: No.
Workers’ Compensation Claims by Undocumented Employees
Statute: The statute states that employee means every person in the service of another and is silent on “aliens” – both “legal” and “illegal.” Ga. Code Ann. § 34-9-1.
Case Law: Dynasty Sample Co. v. Beltrain, 479 S.E.2d 773 (Ga. App. Ct. 1996); Continental Pet Technologies, Inc. v. Palacias, 604 S.E.2d 627 (Ga. App. Ct. 2004); Earth First Grading v. Gutierrez, 606 S.E.2d 332 (Ga. App. Ct. 2004); Martines v. Worley & Sons Constr., 628 S.E.2d 113 (Ga. App. Ct. 2006).
Comments/Explanation/Other: Continental held because the statute included “every person” under a contract of hire makes them an employee, this includes illegal aliens.
*Earth held that disability benefits were payable if the illegal alien was unable to work or return to work as a result of the injury.
**Martines held that disability benefits are not payable if an illegal alien cannot return to work because of their illegal status and not the injury.