Today, in the case of Quinn v. Hulsey, et al., the Georgia Supreme Court held that Georgia’s Apportionment Statute, O.C.G.A. § 51-12-33, abrogated, what the Court called the “Respondeat Superior Rule”:

If a defendant employer concedes that it will be vicariously liable under the doctrine of respondeat superior if its employee is found negligent, the employer is entitled to summary judgment on the plaintiff’s claims for negligent entrustment, hiring, training, supervision, and retention, unless the plaintiff has also brought a valid claim for punitive damages against the employer for its own independent negligence.

The Georgia Supreme Court reasoned that the language of Georgia’s Apportionment Statute requires a jury to apportion fault between the multiple parties and that a plaintiff’s claims for negligent entrustment, hiring, training, supervision and retention are controlled by apportionment and survive summary judgment for an apportionment of liability by the jury even where the employer admits the employee was in the course and scope of her employment.   

Featured In This Article:

Adam C. Joffe

Partner

Atlanta Office

On October 28, 2020, the Court of Appeals of Georgia issued a decision further clarifying the application of O.C.G.A. § 9-11-68, the Georgia statute permitting civil litigants to make pre-suit offers of settlement. The Court’s decision provides further guidance to trial courts and parties as to when, and under what circumstances, attorney’s fees may be recovered post-trial after an offer of settlement under O.C.G.A. § 9-11-68 has been rejected.

Under O.C.G.A. § 9-11-68, if a defendant rejects an offer of settlement and the plaintiff later recovers a verdict in excess of 125 percent of that offer, then that plaintiff is entitled to recover some portion of his attorney’s fees from the defendant. Specifically, the statute provides that a plaintiff in that scenario “shall be entitled to recover reasonable attorney’s fees and expenses of litigation incurred … from the date of the rejection of the offer of settlement through the entry of judgment.” O.C.G.A. § 9-11-68(b)(2).

The newly-decided case, Junior v. Graham, 2020 WL 6305008 (Ga. Ct. App. 2020), concerned a personal injury action where a plaintiff made – and the defendant rejected – a valid offer under O.C.G.A. § 9-11-68. At trial, the jury returned a verdict against the defendant well in excess of 125 percent of the plaintiff’s offer of settlement; significantly, however, the jury’s verdict included an award for the full amount of the plaintiff’s attorney’s fees under a different Georgia statute, O.C.G.A. § 13-6-11.

In Junior, the Court of Appeals held that, notwithstanding the language of O.C.G.A. § 9-11-68, the plaintiff was not entitled to recover any attorney’s fees under that statute. This is because, in light of the jury awarding him the full amount of his attorney’s fees under a different statute, the plaintiff could no longer be said to have “incurred” any attorney’s fees by the time he made his post-trial request for fees to the Court.

The decision in Junior should not be read too broadly. The Court’s decision does not foreclose the possibility of a party recovering fees under both O.C.G.A. § 13-6-11 and O.C.G.A. § 9-11-68 – rather, what it forecloses is a “double recovery” of the same attorney’s fees. In so doing, the decision in Junior represents a significant development in Georgia’s ever-evolving framework of fee awards in civil lawsuits. Practitioners should continue to keep a close eye on further applications of this framework by Georgia’s appellate courts, especially in scenarios where, as in Junior, a party is arguably entitled to fees under two or more statutes.

In what appears to be the first North Carolina ruling in favor of policyholders in a business interruption claim related to COVID-19, a state court judge has granted summary judgment in favor a group of restaurants as to their claim for lost business income and extra expense.  The case involves a group of sixteen restaurants, in five North Carolina counties, who purchased “all risk” insurance policies. These policies included a business income coverage form allowing for payment of actual loss of business income due to the necessary suspension of operations during the period of restoration.  The policies required that the suspension be caused by direct physical loss to property at a premise caused by or resulting from any covered cause of loss.  The policies did not have a virus exclusion.

The restaurants relied upon civil authority orders mandating the suspension of business at their restaurants beginning in March 2020. The restaurants sought a declaratory judgment that government orders constituted perils under the policies that caused direct physical loss to property at the restaurants.  Plaintiffs primarily argued that the government orders forced them to lose physical use and access to their restaurant properties and premises, which constituted a non-excluded “direct physical loss.”  The Court interpreted the phrase “direct physical loss” to include the inability to access their properties. The Court further found the claimed losses were caused by the government orders since the restaurants were expressly forbidden, by government decree, from accessing and putting their property to use for income-generating purposes. 

The insurer argued that the policies do not provide coverage for pure economic harm in the absence of direct physical loss to property.  The Court rejected this argument by finding the phrase “direct physical loss” to be ambiguous, and by resolving the purported ambiguity against the insurer and in favor of the policyholder.  The Court also found that since the policies provide for “accidental physical loss or accidental physical damage”, the use of the conjunction “or” means that a reasonable insured could understand these terms to have distinct and separate meanings.

We expect that the insurer will appeal given that courts in other jurisdictions have found that that “direct physical loss” is not ambiguous and requires structural alteration to property. These jurisdictions have found that an economic loss alone does not trigger business interruption coverage.

To view a copy of the opinion, please click HERE.

On October 19, 2020, the Georgia Supreme Court clarified the application of O.C.G.A. § 51-12-33, which is more commonly known as Georgia’s apportionment statute. The Court’s decision confirms that Georgia’s apportionment statute does, indeed, apply to cases in which strict liability is alleged.

The newly-decided case, Johns v. Suzuki Motor of America, Inc., 2020 WL 6122133 (Ga. Sup. Ct. 2020), concerned a scenario where a plaintiff sustained serious injuries when the front brake on his motorcycle suddenly failed, leading to a crash. The plaintiff in Johns brought suit against both the manufacturer and the distributor of his motorcycle and, at trial, he sought recovery under theories of both strict liability and negligence. Significantly, there was evidence at trial showing that the plaintiff’s own actions contributed to the accident due his failure to change the brake fluid in his motorcycle for approximately eight years prior to the crash.

The jury in Johns ultimately returned a verdict in favor of the plaintiff on all claims, awarding him $10.5 million in compensatory damages. However, importantly, the jury apportioned 49% of the fault to the plaintiff himself, and 51% of the fault to the defendants. Applying O.C.G.A. § 51-12-33, the trial court thus reduced the plaintiff’s recovery to just over $5.3 million. The plaintiff appealed the trial court’s reduction of the verdict, arguing that Georgia’s apportionment statute should not apply to claims in which strict liability is alleged.

The Georgia Court of Appeals confirmed the trial court’s reduction of the jury verdict, finding that Georgia’s apportionment statute applies to strict liability claims. In affirming the Court of Appeals, the Georgia Supreme Court pointed to the plain language of O.C.G.A. § 51-12-33(a), which provides that Georgia’s apportionment framework broadly applies to lawsuits “brought against one or more persons” and which seek recovery “for injury to person or property.” Therefore, the Supreme Court held that a “strict products liability claim falls comfortably within the statute’s textual ambit.” Johns, 2020 WL 6122133 at *2.

In so holding, the Supreme Court rejected a number of the plaintiff’s arguments, including the plaintiff’s argument that allowing apportionment in strict liability claims would essentially sound a death knell for such claims in Georgia. In rejecting that argument, the Supreme Court assuaged any such concerns by noting that plaintiffs bringing a strict liability claim “will still generally be relieved of the burden of showing that the injury-causing product defect was the result of the manufacturer’s negligence.” Id. at *6.

Practically-speaking, the Georgia Supreme Court’s holding in Johns should eliminate any concerns a practitioner may have regarding the applicability of O.C.G.A. § 51-12-33 to claims involving strict liability. Further, both practitioners and insurance carriers alike would do well to take into consideration, when evaluating claims where strict liability is alleged, the Court’s observation that it would simply not be “fair to allow a negligent plaintiff, who may have contributed to as much as fifty percent of his injuries, to pay for none of them and to recover as much as a plaintiff who had taken all precautions reasonable under the circumstances.” Id. at *8 (internal citations omitted).

Teri Zarrillo invites you to join us for our first ever Virtual Roadshow CEU Event!

Be sure to reserve your spot by registering below,

CLICK HERE TO RSVP FOR DAY 1
CLICK HERE TO RSVP FOR DAY 2

Please feel free to share with your Workers’ Comp. team…
the more the merrier. ? Free CEU Credits provided!

If you have any questions, feel free to contact Teri Zarrillo or Britton Farlow.

Teri Zarrillo
TZarrillo@GM-LLP.com
404.264.1500

Britton Farlow
bfarlow@gm-llp.com
404.926.4125

Featured In This Article:

Teri Alpert Zarrillo

Managing Partner

Atlanta Office

Are you interested in attending???

Please CLICK HERE to fill out a short meeting registration form and to receive the zoom link for the webinar. 

For more information, visit the EVENTS Section of our website which can be found by clicking HERE.

Featured In This Article:

James T. Hankins, III

Partner

Atlanta Office

Yesterday, September 22^nd, the U.S. Department of Labor announced a proposed rule clarifying the definition of employee under the Fair Labor Standards Act (FLSA) as it relates to independent contractors.

The proposed rule from The Department would:

• Adopt an “economic reality” test to determine a worker’s status as an FLSA employee or an independent contractor. The test considers whether a worker is in business for himself or herself (independent contractor) or is economically dependent on a putative employer for work (employee);
• Identify and explain two “core factors,” specifically the nature and degree of the worker’s control over the work, and the worker’s opportunity for profit or loss based on initiative and/or investment. These factors help determine if a worker is economically dependent on someone else’s business or is in business for himself or herself;
• Identify three other factors that may serve as additional guideposts in the analysis: the amount of skill required for the work; the degree of permanence of the working relationship between the worker and the potential employer; and whether the work is part of an integrated unit of production; and
• Advise that the actual practice is more relevant than what may be contractually or theoretically possible in determining whether a worker is an employee or an independent contractor.

The Notice of Proposed Rulemaking is available for public comments and review for 30 days after it is published in the Federal Register.

You can read more from The Department here, https://www.dol.gov/newsroom/releases/whd/whd20200922

Our team at Goodman McGuffey is happy to report that the Court of Appeals has reversed the trial Court’s previous ruling denying summary judgment in one of our negligent security cases, directing Judgment be granted in our favor.

The Opinion addressed the important issues that crime statistics and 911 records without additional evidence cannot be used to establish a premises owners’ knowledge of crime. The Court also addressed the issue of the superior knowledge of the Plaintiff.   The Court relied on another one of our cases, Bolton v. Golden Business. 

A good win and a positive result for the client. Great work from our Liability team at GM and we appreciate the hard work on this case from former GM attorney, Elissa Haynes, Esq., who handled it with Robert Luskin.

You can access the decision HERE.

Attorneys Robert Luskin, Teri Zarrillo, James Hankins, and Bert Noble hit the green yesterday, September 16th, for the Georgia Association Of Convenience Stores Golf Tournament at Stone Mountain Golf Club in Stone Mountain, GA.

Thanks for having us as a sponsor and cannot wait until next year!

Featured In This Article:

Teri Alpert Zarrillo

Managing Partner

Atlanta Office

James T. Hankins, III

Partner

Atlanta Office

For the sixth time, Georgia Supreme Court Chief Justice Harold Melton has extended the Statewide Judicial Emergency Order until Saturday, October 10, 2020 at 11:59 p.m. All Georgia courts shall continue to operate under the restrictions set forth in that Order as extended; the provisions of this order below are identical to the August 11 extension order except for Section I, which has been substantially revised, and a minor corresponding revision in Section II (A) (1). Where this Order refers to “public health guidance,” courts should consider the most specific current guidance provided by the federal Centers for Disease Control and Prevention (CDC), the Georgia Department of Public Health (DPH), and their local health departments. You can access the extension HERE.

You can access more information on the COVID-19 orders and extensions on our COVID-19 Update page on our website.