About once a month, we receive a solicitation to purchase some made-up “honor” with a certificate suitable for framing designating the “best” or “top” lawyers in my practice area. Almost all are phony vanity distinctions for sale to anyone willing to pay the inflated price, but signifying nothing. I either toss them in the “round file” or post on the office refrigerator with sarcastic annotations.
This one, as Diplomate of the National College of Advocacy, actually signifies something — 400 hours of high quality, national level continuing legal education in my practice area. These hours were accumulated over the years through seminars and workshops from coast to coast in Chicago, Los Angeles, Montreal, New Orleans, Boston, Cambridge, New York, Baltimore, San Francisco, Las Vegas, Boca Raton, Atlanta and a lot of webinars. I also spoke or was program chair at many of those seminars. Last year, I served as chair of the AAJ Motor Vehicle Collision, Highway & Premises Liability Section.
The National College of Advocacy is the continuing education arm of the American Association for Justice. The goal of this program is to build and develop professional knowledge through a continuing commitment to improving members’ trial skills and understanding of substantive law. “Diplomate” is the highest level of recognition for voluntary participation in programs of the National College of Advocacy.
Ken Shigley is a past president of the State Bar of Georgia, former chair of the board of the Institute for Continuing Legal Education in Georgia, lead author of Georgia Law of Torts: Trial Preparation and Practice, a Certified Civil Trial Attorney of the National Board of Trial Advocacy, and a Diplomate of the National College of Advocacy. A graduate of Emory University Law School, he is a candidate for the Georgia Court of Appeals in 2018.
Very often, in wrongful death lawsuits I represent families who after traumatic loss of a family member struggle with grief. Mourning the death of a loved one is a universal experience that sooner or later befalls all of humanity. But despite the common themes, everyone has a different experience of grief and loss.
I wrote this on the morning of 6/17/17, by the deathbed of my sedated wife of 34 years who has had a valiant 29-year battle with recurring brain tumors and had been in home hospice care for nearly two months. I did not realize that at about 4 PM that day, she would pass from this life. With time for final conversations in anticipation of her passage from this life, our experience was vastly different from one who suddenly loses a spouse, parent or child in a truck-car crash.
Most people have heard of the Kubler-Ross five stages of grief — denial, anger, bargaining, depression and acceptance. That is a valuable structure for thinking about how we handle death and learn to live without the one we lost. But we should not view it as a linear timeline for how to cope with grief.
People who are dealing with the loss of a loved one should not be ashamed to consult with an experienced grief counselor, even just as a consultant on how to work through a painful passage in life. A pastoral counselor at my church shared with me John Worden’s outline on the “Tasks of Mourning” from the now-defunct Center for Grief Care and Education in San Diego.
- To accept the reality of the loss. Long after our mind accepts the fact of death, our body and imagination go on living as if the death did not occur. We may hear the voice of the person who has died, feel their touch, see them in a familiar chair. We may buy special foods for them, or mentally recite stories to share with them. Each time we fail to find them, we acknowledge a little more deeply the fact that they are gone and the hold that they have left in our lives. This slow one-day-at-a time work of acknowledging the first task of mourning.
- To work through the pain of grief. Enduring waves of sorrow, explosions of rage, stretches of bleak despair, restless searching, and questioning why are included in the second task of mourning. When a person has been an important part of our lives for many years, the pain of losing them cannot be experienced all at once. Even if our feelings for them were mixed, the years leave their mark. We may feel the pain of loving not only what we had, but what we never had as well.
- To adjust to an environment in which the deceased is missing. In a very real sense, we face a new and unfamiliar world. We need to adjust, just as an immigrant needs to adjust to the language and culture of his new country. We need to develop and get used to new routines, learn to handle new responsibilities, learn to interact with other people in new ways. This process of discovering what this new world is like and learning how to cope with it is the third task of mourning.
- To emotionally relocate the deceased and move on with life. No, we do not want to stop loving the person who has died, or cherishing the memories. Yet, the fourth task of mourning is to find a place for the deceased that will not impair our ability to give and receive love here on earth. We remain connected to our loved one through our recollections and memorializing acts, and are able to simultaneously invest in life. Whether or not we enter into similar relationships (such as remarrying or having more children), our task is to discovery people, activities, and causes to invest in, to experience love, and to satisfy our need to be loved. Opening up again to loving and being loved is the fourth task of mourning.
This reminds me of one of my maternal grandmother who lost two daughters, at 7 and 14, shortly before my mother was born in 1926. All her life, in their modest mill village house, framed photos of dead daughters dominated the living room. All her life, for roughly 60 years after the deaths of her daughters, she would occasionally talk about those daughters and weep. While one must find a way to move on, one never forgets.
Ken Shigley is a past president of the State Bar of Georgia, a board certified civil trial attorney, and author of Georgia Law of Torts: Trial Preparation and Practice. He has practiced law in Georgia for forty years.
This morning on her way to work, a paralegal in our office was injured when someone rear-ended her car on the way to work. When she was waiting for a CT scan in the hospital emergency department, she sent us a text reporting that she had already been called on her cell phone by two “runners” to solicit her for unidentified lawyers. Apparently someone in the police department, ambulance service or hospital had corruptly sold her personal information to someone who was willing to commit a crime and a disbarment offense to solicit her for a case. I asked if she would like to participate in a “sting” investigation to get those lawyers disbarred.
Here are the two things you may do after such a solicitation to help stamp out this predatory practice:
- Contact Paula Frederick, General Counsel of the State Bar of Georgia
[email@example.com, (404) 527-8720] This is a disbarment offense but no cases are made without someone filing a grievance, so offer to participate in an investigation and to file a grievance.
- Contact the District Attorney or Solicitor General in the county where the solicitation occurred. Find Your Prosecutor. Offer to participate in an investigation of the criminal offense and to testify.
Too many times during my career, I have been asked to take over cases that were already ruined through mishandling by bottom feeding lawyers who solicited the cases in clear violation of Bar ethics rules, either directly or through a “runner” or a chiropractor. By the time those clients fired their original lawyers and came to me, great damage had been done to their cases. Sometimes I was able to salvage a respectable case, but often those cases were “FUBAR” (WWII era military acronym for “fouled(?) up beyond all recognition”).
And too many times, I have had calls from injured people who said they wanted to get a “real lawyer” rather than the idiots who were calling them on the phone to solicit them a day or two after a wreck.
After the Georgia Southern University nursing student tragedy in 2015, I published an op-ed in the Daily Report, “Victims’ Families Need Time to Grieve, Should Report Ambulance Chasers.”
All too often I hear of injury victims who were directly solicited by phone or in a hospital by “runners” working for unethical, bottom-feeding lawyers. If you or a loved on is solicited after suffering an injury, you should know that any lawyer who participates in that sort of solicitation is subject to disbarment if caught.
Georgia Rule of Professional Conduct 7.3 provides, in part, as follows:
(d) A lawyer shall not solicit professional employment as a private practitioner for the lawyer, a partner or associate through direct personal contact or through live telephone contact, with a non-lawyer who has not sought advice regarding employment of a lawyer.
Solicitations of accident victims by mail are improper within the first 30 days after the injury. Rule 7.3 also provides:
(a) A lawyer shall not send, or knowingly permit to be sent, on behalf of the lawyer, the lawyer’s firm, lawyer’s partner, associate, or any other lawyer affiliated with the lawyer or the lawyer’s firm, a written communication to a prospective client for the purpose of obtaining professional employment if: . . .
(3) the written communication concerns an action for personal injury or wrongful death or otherwise relates to an accident or disaster involving the person to whom the communication is addressed or a relative of that person, unless the accident or disaster occurred more than 30 days prior to the mailing of the communication;
The maximum penalty for a violation of Rule 7.3 is disbarment.
This stain on the legal profession is not limited to Georgia. In some states there have been damage suits against lawyers who use “runners” on the basis of violation of Fair Business Practice statutes. In Florida, the Attorney General issued a statewide grand jury report on the fraudulent practices involved with solicitation of injury victims by “runners.” Texas recently passed a law attacking this practice as “barratry.” Another approach could be to make any fee contract obtained through use of runners voidable at any time in order to reduce the financial incentive, but that too could be subject to abuse by clients falsely claiming at the time of settlement that a runner was involved in order to extort an innocent lawyer in to giving up an honestly earned fee.
However, bottom feeding lawyers who were not concerned about their professional reputation have felt free to violate this rule. Because people who are solicited either hang up immediately, or are too unsophisticated and naïve to recognize a problem, there has been hardly any way to prosecute the cases. It is very difficult to do make these cases without a sting investigation, which the Bar’s general counsel has not felt equipped to do. The main “runner” case for which there has been bar discipline in recent years came about only when federal agents executed a search warrant at a law office, found the “runner book” and turned it over to the State Bar.
Therefore, as State Bar president, I pushed to provide training for State Court solicitors, law enforcement and hospital attorneys on how to carry out these investigation. I appointed a committee to address the problem, and included former FBI agents, State Court solicitors and hospital counsel. While we passed a tweak of lawyer advertising rules, which were approved by the Supreme Court two years later, we were unable to get overburdened law enforcement agencies or prosecutors interested in making these cases.
One of the things I tried to attack during my term as State Bar president was the use of “runners” to unethically solicit people who have been involved in car wrecks. I appointed a committee to explore options for attacking the problem. However, vigorous prosecution of these cases would require an effective sting investigation, which as a former prosecutor I was willing to attempt. However, that is something with which the Bar’s general counsel has never felt comfortable. Sting investigations could be undertaken by law enforcement, but they are reluctant to commit resources for such investigations when the criminal offense is only a misdemeanor. Thus, I eventually came to the conclusion that the only way to get meaningful enforcement is to make it a felony.
In 2014, the legislature took a stab at it, making the second offense a felony. HB 828 passed at the close of the session on March 20th. While I was not involved in drafting this bill, I did have conversations on the topic several months ago with one of the lead sponsors. Its bipartisan sponsors include Rep. Wendell Williard (R-Sandy Springs, chair of House Judiciary Committee), Rep. Ronnie Mabra (D-Fayetteville), Rep. Dustin Hightower (R-Douglasville), Rep. Trey Kelley (R-Cedartown), Rep. Calvin Smyre (D-Columbus) and Rep. Pam Stephenson (R-Atlanta). The Senate sponsor was Sen. Hunter Hill (R- Atlanta).
This bill enacts a new Code Section 33-24-53 to read as follows:
(a) As used in this Code section, the term:
(1) ‘Capper,’ ‘runner,’ or ‘steerer’ means a person who receives a pecuniary benefit from a practitioner or health care service provider, whether directly or indirectly, to solicit, procure, or attempt to procure a client, patient, or customer at the direction or request of, or in cooperation with, a practitioner or health care service provider whose purpose is to obtain benefits under a contract of insurance or to assert a claim against an insured or an insurer for providing services to the client, patient, or customer. Capper, runner, or steerer shall not include:
(A) Any insurance company or agent or employee thereof who provides referrals or recommendations to its insureds; or
(B) A practitioner or health care service provider who procures clients, patients, or customers through the use of public media or by referrals or recommendations from other practitioners or health care service providers.
(2) ‘Practitioner’ means an attorney, health care professional, owner or partial owner of a health care practice or facility, or any person employed or acting on behalf of any of the individuals in this paragraph.
(3) ‘Public media’ means telephone directories, professional directories, newspapers and other periodicals, radio and television, billboards, and mailed or electronically transmitted written communications that do not involve in-person contact with a specific prospective client, patient, or customer.
(b) Except as provided for in paragraph (5) of subsection (a) of Code Section 50-18-72, it is unlawful for any person in an individual capacity or in a capacity as a law enforcement officer, law enforcement records staff member, wrecker services staff member, emergency staff member, physician, hospital employee, or attorney to solicit, release, or sell any information relating to the parties of a motor vehicle collision for personal financial gain. This subsection shall not apply to mass public media advertisement and solicitation.
(c) It is unlawful for:
(1) Any person in an individual capacity or in a capacity as a public or private employee or any firm, corporation, partnership, or association to act as a capper, runner, or steerer for any practitioner or health care service provider. This paragraph shall not prohibit an attorney or health care provider from making a referral and receiving compensation as is permitted under applicable professional rules of conduct; and
(2) Any practitioner or health care service provider to compensate or give anything of value to a person acting as a capper, runner, or steerer. It is also unlawful for any capper, runner, or steerer to recommend or secure a practitioner’s or health care service provider’s employment by a client, patient, or customer if such practitioner or health care service provider obtains or intends to obtain benefits under a contract of insurance or asserts a claim against an insured or an insurer for providing services to the client, patient, or customer.
(d) Any natural person convicted of a violation of this Code section shall, on the first offense, be guilty of a misdemeanor and, upon conviction thereof, shall be punished by imprisonment of not less than 30 days and a fine not to exceed $1,000.00. Any natural person convicted of a second or subsequent violation of this Code section shall be guilty of a felony and, upon conviction thereof, shall be punished by imprisonment of not more than ten years and by a fine of not more than $100,000.00 per violation.”
Code Section 50-18-72 of the Official Code of Georgia Annotated, relating to when public disclosure of records is not required, is amended by revising paragraph (5) of subsection (a) as follows:
“(5) Individual Georgia Uniform Motor Vehicle Accident Reports, except upon the submission of a written statement of need by the requesting party to be provided to the custodian of records and to set forth the need for the report pursuant to this Code section; provided, however, that any person or entity whose name or identifying information is contained in a Georgia Uniform Motor Vehicle Accident Report shall be entitled, either personally or through a lawyer or other representative, to receive a copy of such report; and provided, further, that Georgia Uniform Motor Vehicle Accident Reports shall not be available in bulk for inspection or copying by any person absent a written statement showing the need for each such report pursuant to the requirements of this Code section.
For the purposes of this subsection, the term ‘need’ means that the natural person or legal entity who is requesting in person or by representative to inspect or copy the Georgia Uniform Motor Vehicle Accident Report:
(A) Has a personal, professional, or business connection with a party to the accident;
(B) Owns or leases an interest in property allegedly or actually damaged in the accident;
(C) Was allegedly or actually injured by the accident;
(D) Was a witness to the accident;
(E) Is the actual or alleged insurer of a party to the accident or of property actually or allegedly damaged by the accident;
(F) Is a prosecutor or a publicly employed law enforcement officer;
(G) Is alleged to be liable to another party as a result of the accident;
(H) Is an attorney stating that he or she needs the requested reports as part of a criminal case, or an investigation of a potential claim involving contentions that a roadway, railroad crossing, or intersection is unsafe;
(I) Is gathering information as a representative of a news media organization; provided, however, that such representative submits a statement affirming that the use of such accident report is in compliance with Code Section 33-24-53. Any person who knowingly makes a false statement in requesting such accident report shall be guilty of a violation of Code Section 16-10-20;
(J) Is conducting research in the public interest for such purposes as accident prevention, prevention of injuries or damages in accidents, determination of fault in an accident or accidents, or other similar purposes; provided, however, that this subparagraph shall apply only to accident reports on accidents that occurred more than 60 days prior to the request and which shall have the name, street address, telephone number, and driver’s license number redacted; or
(K) Is a governmental official, entity, or agency, or an authorized agent thereof, requesting reports for the purpose of carrying out governmental functions or legitimate governmental duties.
What to do if you or a loved one is directly solicited for a personal injury or wrongful death case:
Would you really want your important case to be handled by a bottom feeding scumbag of a lawyer so unethical and desperate that he is willing to risk losing his license to practice law if he is caught in that solicitation?
If you receive such a solicitation, get the name and number of the caller and then immediately call the State Bar of Georgia Office of General Counsel at (404) 527-8720, and offer to assist in investigation and file a grievance for violation of Rule 7.3.
Since this is also a criminal offense, report it to your local District Attorney.
The State Bar needs to enforce the ethical rules and uphold virtue in the legal profession, but it cannot make strong disciplinary cases against such unethical lawyers without evidence required to support a prosecution.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, a board-certified civil trial attorney of the National Board of Trial Advocacy, and lead author of Georgia Law of Torts: Trial Preparation and Practice. He may be reached at 404-253-7862 or firstname.lastname@example.org.
Lawyers and paralegals who had previously worked at personal injury firms that advertise heavily on television, billboards and bus placards have told me many tales about the business model of those firms.
They have told me how lawyers may be responsible for 600 cases at a time, with 100 or more in litigation.
They have told me how young lawyers in some of those firms are paid only for work on cases they settle before suit, so they have an extreme vested interest in taking whatever an insurance adjuster is willing to offer at that early stage, selling the client’s interest short. They have told me how in some firms non-attorneys employees actually negotiate with claims adjusters with no substantial attorney involvement. They have told me how those firms threaten clients that if they do not accept the insurance company’s pre-suit offer, they may be required to pay the other side’s attorney fees, long before suit is filed or the defense invokes the “offer of judgment” rule that would make that even theoretically possible.
That is a business model but not the practice of law as I know it. Every time I have accepted a case after a client left one the the big advertising firms, I have found that with moderate amount of real lawyer work, I have been able to increase the recovery 8 to 10 times beyond what a lawyer or paralegal at the prior firm had been pressuring the client to accept. It appeared that the case handling strategy at those firms was “sign ’em and flip ’em.”
“Run-of-the-Mill Justice” by Stanford Law professor Nora Freeman Engstrom, published in Georgetown Journal of Legal Ethics in 2009, analyzed the practices of “settlement mill” law firms — those that “advertise aggressively, sign a higher percentage of callers to contract, delegate more duties to non-lawyers, file fewer lawsuits, and take far fewer cases to trial” than legitimate law firms and attorneys.
Over the past three decades, no development in the legal services industry has been more widely observed and less carefully scrutinized than the emergence of firms I call “settlement mills”—high-volume personal injury law practices that aggressively advertise and mass produce the resolution of claims, typically with little client interaction and without initiating lawsuits, much less taking claims to trial. Settlement mills process tens of thousands of claims each year. Their ads are fixtures on late-night television and big-city billboards.
These settlement mills differ from conventional law practices because they settle everything, and do so without the negotiator having the benefit of “(1) first-hand information about verdicts obtained in comparable cases, (2) detailed information about the intricacies of the particular claim, and (3) the proven willingness and ability to take the claim to court.”
Settling all cases — including the catastrophic cases — cheaply in relation to the value the cases would have at trial, the settlement mills lack the ability to credibly move cases to jury trial, but offer insurance companies quick, cheap settlements.
Attorneys at settlement mills handle an extraordinarily high number of cases, necessarily treating them in “cookie cutter” fashion. Consequently, they spend “little time engaged in legal research, investigating claims, and preparing pleadings.” The article reports that “one Georgia settlement mill attorney reports that she personally settled approximately 600 to 700 claims in a thirteen-month span.” That is absolutely consistent with what I have been told by a number of lawyers who had left such firms.
Client screening and even settlement negotiations are delegated to non-lawyers. Cases may go from intake to settlement without any attorney contact. That is consistent with what paralegals who once worked at such firms have told me.
Many of these settlement mills seldom file suit or investigate cases, and almost never take a case to trial or refer to a firm that is capable of doing so.
Negotiations with insurance adjusters may take no more than ten minutes, and then clients are pressured to take whatever it offered. (Thus the slogan “one call that’s all” may be literally true — one call to the insurance company is all you get.)
Such settlement mills prey upon uneducated and unsophisticated people who don’t know any better than to respond to heavy TV advertising. Since TV advertising lawyers are stigmatized among lawyers and judges, the attorneys in those firms no longer feel bound by a need to maintain good reputations in the profession. Thus, there is no need to do good work for clients in order to maintain a strong reputation among other attorneys. If a lawyer relies solely upon heavy advertising to produce clients, reputation and relationships do not matter. All they need is a heavy advertising budget and a steady flow of unsophisticated, unsuspecting clients to sell down the river.
They negotiate claims on the basis of formulas that have little to do with the value of cases if they were taken to trial.
The article concludes that insurance companies like settlement mills because they settle quickly and cheaply, even in catastrophic cases, without litigation.
Bar organizations can do little about law firms that operate in this manner because federal courts bar tough regulation of legal advertising. Their operations operate “under the radar” because most of them almost never file their cases in courts. They are the kudzu of the legal system, operating in a manner generally contrary to the interest of their clients and the public, and just as hard as kudzu to limit.
Ken Shigley is a past president of the State Bar of Georgia (2011-12) and past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section (2015-16). He is one of only 18 Georgia lawyers with double board certification in Civil Trial Advocacy and Civil Pretrial Advocacy, and lead author of Georgia Law of Torts: Trial Preparation and Practice (Thomson Reuters, 2010 – present). Mr. Shigley has extensive experience representing parties in trucking and bus accidents, products liability, catastrophic personal injury, wrongful death, brain injury, spinal cord injury and burn injury cases.
Effective representation of the plaintiff in a case of serious injury or wrongful death often requires that counsel overcome an “independent contractor” defense. That frequently involves solving a shell game of independent contractor business relationships used to evade financial responsibility. Sometimes lawyers refer to this as getting “beyond the monkey to the organ grinder.”
The general rule is that a defendant is not liable for the negligence of an independent contractor, but there are many exceptions. While not comprehensive, this paper seeks to outline major theories for overcoming the independent contractor defense.
- Interstate Motor Carriers.
Prior to 1956, interstate motor carriers commonly sought to evade financial responsibility by hiding behind “independent contractor” arrangements. In 1953, while addressing carriers’ evasion of accountability similar to that engaged in by the ATF in this case, the United States Supreme Court described such practices as “evils that had grown up” in the industry, and that the ICC need not “sit idly by and wink at practices that lead to violations of its provisions.” American Trucking Ass’ns v. United States, 344 U.S. 298, 301, 311 (1953). Those “evils” were summarized in Rediehs Express, Inc. v. Maple, 491 N.E.2d 1006 (Ind. Ct. App. 1986):
The history of the regulations of motor carriers reveals that after the commencement of regulation in 1935, . . . a substantial number of carriers . . . began to use equipment owned and driven by truckers who had no such ICC operating authority. This use was accomplished by a variety of leases, trip leases, and by other arrangements under which owner-operator truckers carried on the operations of the carriers with operating authority. In contracting with such persons the carriers took care to constitute the lessors as independent contractors which enabled them to avoid the commission’s safety, financial, and insurance regulations that had been prescribed for equipment and drivers in order to protect the public.
Many of the owner-operators without authority were itinerant truckers known as “gypsies,” fly-by-night truckers with poor, unsafe equipment who had little financial ability. They may or may not have had adequate insurance. The hard core of the problem was the trip lease and its attendant evils which permitted an indifferent carrier to evade its safety and financial responsibility. . . . The practice of leasing made it difficult in accident cases to fix responsibility, and certified carriers could thus escape the consequences of the regulations and responsibility for accidents by employing irresponsible persons as independent contractors who were not financially accountable and who had no insurance or were under-insured.
“The use of non-owned vehicles led to public confusion as to who was financially responsible for accidents caused by those vehicles.” Graham v. Malone Freight Lines, Inc., 948 F.Supp. 1124, n.3 (D. Mass. 1996). Thus, interstate motor carriers often “were able to escape liability for virtually all motor vehicle accidents occurring in the motor carrier’s business.” Cincinnati v. Haack, 708 N.E.2d 214 (Ohio Ct. App. 1997). In such cases, it was “clear that the scheme as a whole is a mere subterfuge, an unpermitted evasion, not a real avoidance of the provisions of the law.” Georgia Truck System, Inc. v. Interstate Commerce Commission, 123 F.2d 210 (5th Cir. 1941), as it was “the motor carrier who has put the entire trip in motion,”American Transit Lines v. Smith, 246 F.2d 86, 87 (6th Cir. 1957).
Since 1956, federal law has treated truck drivers who are treated as independent contractors for purposes of tax and employment law as statutory employees of a motor carrier in the interstate motor carrier context. The 1956 amendment to the Interstate Common Carrier Act was intended to require a motor carrier to be fully responsible for the maintenance and operation of the leased equipment and the supervision of the borrowed drivers, thereby protecting the public from accidents, preventing public confusion about who was financially responsible if accidents occurred, and providing financially responsible defendants. Price v. Westmoreland, 727 F.2d 494 (5th Cir. 1984); Morris v. JTM Materials, supra.
“These are basic requirements that are inherent in the relation of the for-hire carrier to the public. When they are lacking, the chaotic conditions that preceded enactment of the Motor Carrier Act, 1935 inevitably ensue.” Cox v. Bond Transp., Inc., 249 A.2d 579 (N.J. 1969). The purpose is “to protect persons who are injured in highway accidents, by increasing the likelihood that a substantial entity will be available to respond to any judgment rendered.” Johnson v. Pacific Intermountain Express Co., 662 S.W.2d 237 (Mo. 1983). This eliminates “the defense of independent contractor by making the owner/operator of the equipment the ‘statutory employee’ of the carrier.” Shell v. Navajo Freight Lines, 693 P.2d 382 (Colo. Ct. App. 1984).
The Federal Motor Carrier Safety Regulations, 49 C.F.R. § 390.5, defines the term“employee” as,
any individual, other than an employer, who is employed by an employer and who in the course of his or her employment directly affects commercial motor vehicle safety. Such term includes a driver of a commercial motor vehicle (including an independent contractor while in the course of operating a commercial motor vehicle), a mechanic, and a freight handler.
The Regulatory Guidance to 49 C.F.R. § 390.5 , at Question 17, explains:
The term “employee,” as defined in § 390.5, specifically includes an independent contractor employed by a motor carrier. The existence of operating authority has no bearing upon the issue. The motor carrier is, therefore, responsible for compliance with the FMCSRs by its driver employees, including those who are owner-operators.
62 Fed. Reg. 16,407 (April 4, 1997). 49 C.F.R. Chapter III: Regulatory Guidance for the Federal Motor Carrier Safety Regulations, Interpretation to § 390.5, question 17 (1997)(emphasis added). See also 49 C.F.R. § 390.5 (2002).
The definition of “motor carrier” includes “a motor carrier’s agent,” “employee” includes “an independent contractor while in the course of operating a commercial motor vehicle.” 49 C.F.R.§ 390.5, and “lease” includes a “contract or arrangement in which the owner grants the use of equipment, with or without driver . . . .” 49 C.F.R.§ 376.2. The alternative and disjunctive reference to “contract or arrangement” must have some significance other than mere redundancy. Moreover, “[e]very motor carrier, its officers, agents . . . shall be instructed in and comply with the rules . . . .” 49 C.F.R. § 392.1.
These Regulations were intended to safeguard the public by preventing motor carriers from circumventing applicable regulations by leasing the equipment and services of independent contractors exempt from federal regulation. The definition of “lease” as “contract or arrangement” extends to any arrangement by which a carrier allows another to haul its freight for compensation. Any other construction would defeat the Congressional policy of requiring financially responsible interstate transportation. Hartford Ins. Co. v. Occidental Fire & Cas. Co., 908 F.2d 235 (7th Cir. 1990); Transamerica Ins. Co. v. Maryland Cas. Ins. Co., 166 Ariz. 219, 801 P.2d 454 (1990).
Restatement of Torts 2nd – Liability Of An Employer Of An Independent Contractor
The Second Restatement of Torts includes 15 exceptions to the general rule that an employer is not responsible for the negligence of an independent contractor. These exceptions are sometimes referred to as non-delegable duties. This paper is not intended as a comprehensive analysis of court decisions applying, approving, rejecting or distinguishing these Restatement provisions.
- Contractor’s Conduct In Obedience To Employer’s Directions
Restatement (Second) of Torts § 410 provides:
The employer of an independent contractor is subject to the same liability for physical harm caused by an act or omission committed by the contractor pursuant to orders or directions negligently given by the employer, as though the act or omission were that of the employer himself.
Comment b states that this section deals only with the “liability of an employer who does not intend that the contractor shall cause physical harm to any other person, but who either employs a contractor to do work which, no matter how carefully done, involves an unreasonable risk of physical harm to others to whom he owes a duty to exercise care, or who employs a contractor to do work which could be safely done but for the fact that he directs the contractor to do it in a manner involving such risk.
The liability is based upon the fact that the employer has been negligent in directing his contractor to do work which is dangerous in itself or in the manner in which it is done. Therefore, the employer is subject to liability, under the rule stated in this Section, for only such physical harm as is caused by the dangerous character of the work or the dangerous manner in which it is directed to be done. He is not subject to liability for any harm caused by some improper method which the contractor, without any direction of his employer, adopts in doing the work.”
Comment c clarifies that “the orders and directions are not negligently given if the employer neither knows nor should know that the work involves such risk even though the contractor discovers during the progress of the work that such risks will be involved in following the orders and directions.”
Comment d explains that “this Section is most usually applicable where construction or repair work is entrusted to an independent contractor under plans and specifications provided by the employer, which prescribe the result to be attained and the material to be used in the work and the manner in which it is to be used. It is, however, equally applicable wherever an employer otherwise directs his independent contractor to do work which, in itself or as ordered to be done, is unreasonably dangerous to others.”
One of the illustrations in the comments is as follows: “A hires a taxicab, tells the driver, B, that he has only five minutes to catch his train, directs B to ignore traffic signals, and offers him a reward of five dollars if he will get to the station in time for the train. While B is driving the taxicab at an excessive rate of speed, it collides with the car of C, causing harm to C. A is subject to liability to C.” It would seem this should be applicable to a shipper, freight broker or logistics company who knowingly establishes positive or negative incentives for a trucker or trucking company to ignore hours of service and other safety regulations,
Comment h provides: “The act of the contractor which subjects the employer to liability under the rule stated in this Section is usually negligence on the part of the contractor. But this is not necessarily true. It may happen that the employer knows or should know of circumstances of which the contractor is excusably ignorant, and which make the work or the manner in which it is directed to be done unreasonably dangerous. In such a case, the contractor would not be subject to liability since he, as a reasonable man, would not realize the risk involved in his conduct. On the other hand, the employer, as a reasonable man, should realize the danger and is negligent in directing the work to be done.
In Posner v. Paul’s Trucking Service, Inc., 380 F.2d 757 (1st Cir.,1967), a freight broker required delivery by an independent contractor on a schedule that could not be made in compliance with hours of service rules, thus creating a jury question of the broker’s liability in negligently giving those instructions. Restatement § 410 has been seldom followed in Southern states but has been applied in at least a couple of Tennessee cases. See Givens v. Mullikin ex rel. Estate of McElwaney, 75 S.W.3d 383, 394 (Tenn., 2002)(Insurer and insured could be held vicariously liable for insurance defense lawyer’s abuse of process directed, commanded, or knowingly authorized by insurer or insured), and Waggoner Motors, Inc. v. Waverly Church of Christ, 159 S.W.3d 42, 53 (Tenn.Ct.App.,2004)(Where a church acting as its own general contractor retained and exercised control over independent contractor’s work, knew or had reason to know of the unreasonable risks posed by overspray, and ordered contractor to proceed despite his warnings of potential overspray damage, it was liable for the negligence of the subcontractor).
- Negligence In Selection Of Contractor
Restatement (Second) of Torts § 411 provides:
An employer is subject to liability for physical harm to third persons caused by his failure to exercise reasonable care to employ a competent and careful contractor
(a) to do work which will involve a risk of physical harm unless it is skillfully and carefully done, or
(b) to perform any duty which the employer owes to third persons.
Safety rather than financial responsibility is the focus of this section, so merely hiring an independent contractor that is not financially responsible is not enough.
- Failure To Inspect Work Of Contractor After Completion
Restatement (Second) of Torts § 412 provides:
One who is under a duty to exercise reasonable care to maintain land or chattels in such condition as not to involve unreasonable risk of bodily harm to others and who entrusts the work of repair and maintenance to an independent contractor, is subject to liability for bodily harm caused to them by his failure to exercise such care as the circumstances may reasonably require him to exercise to ascertain whether the land or chattel is in reasonably safe condition after the contractor’s work is completed.
Comment c enumerates factors considered under this section as follows: “(1) the danger involved in the condition of the structure or chattel if the work is entrusted to the contractor is not carefully and skillfully done; (2) the character of the work—whether it is of the kind which a competent contractor is so likely to do properly that it is reasonable to rely entirely or to a certain extent upon his competence as a sufficient assurance that the work has been safely done; (3) the ability which the employer has or should have to appreciate the proper or improper character of the work done for him by the contractor; (4) the ease or difficulty of ascertaining the actual character of the completed work; and (5) the existence of a relation between the contractor’s employer and those injured by the careless or incompetent work of the contractor which entitles them to expect that the employer will personally exercise care for their safety.”
Comment e states that “[t]he rule stated in this Section subjects the employer of an independent contractor to liability only if, as a result of his failure to exercise such care as the circumstances require in inspecting the completed work done by his contractor, he fails to discover its bad condition and as a result bodily harm is caused to someone to whom he owes a duty of maintaining his land or chattels in reasonably safe condition.”
The extent of the employer’s knowledge and experience in the field of work to be done is to be taken into account.
- Duty To Provide For Taking Of Precautions Against Dangers Involved In Work Entrusted To Contractor
Restatement (Second) of Torts § 413 states:
One who employs an independent contractor to do work which the employer should recognize as likely to create, during its progress, a peculiar unreasonable risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the absence of such precautions if the employer
(a) fails to provide in the contract that the contractor shall take such precautions, or
(b) fails to exercise reasonable care to provide in some other manner for the taking of such precautions.
This section is not concerned with routine precautions such as driving at a safe speed with good brakes. Rather, it deals with “peculiar risks” such as demolition of buildings, excavations, etc.
- Negligence In Exercising Control Retained By Employer
Restatement (Second) of Torts § 414 states:
One who entrusts work to an independent contractor, but who retains the control of any part of the work, is subject to liability for physical harm to others for whose safety the employer owes a duty to exercise reasonable care, which is caused by his failure to exercise his control with reasonable care.
This requires more than a general right to determine objectives. There must be some retention of control of operative details, such as when a principal has a foreman on site to supervise work of contractors.
- Duty Of Possessor Of Land To Prevent Activities And Conditions Dangerous To Those Outside Of Land
Restatement (Second) of Torts § 414A provides:
A possessor of land who has employed or permitted an independent contractor to do work on the land, and knows or has reason to know that the activities of the contractor or conditions created by him involve an unreasonable risk of physical harm to those outside of the land, is subject to liability to them for such harm if he fails to exercise reasonable care to protect them against it.
This does not create a duty to inspect, or any reason not to assume that an apparently contractor will not perform work properly. However, when the principal “knows or has reason to know that the contractor is engaging or is about to engage in an activity, or that he has created or is about to create conditions, which will involve such an unreasonable risk to others outside of the land, it is his duty to interfere, and to exercise reasonable care to prevent physical harm to such persons. . . ”
- Duty To Supervise Equipment And Methods Of Contractors Or Concessionaires On Land Held Open To Public
Restatement (Second) of Torts § 415 states:
A possessor of land who holds it open to the public for any purpose is subject to liability to members of the public entering for that purpose for physical harm caused to them by his failure to exercise reasonable care to protect them against unreasonably dangerous activities of, or unreasonably dangerous conditions created by, an independent contractor or concessionaire employed or permitted to do work or carry on an activity on the land.
This is “based upon the failure of the possessor of the land in question to exercise reasonable care to supervise the equipment or methods of his contractor or concessionaire who carries on an activity which endangers the public attracted to the possessor’s land. In order that the liability shall exist, it is, therefore, necessary, not only that the contractor shall be negligent, but also that the possessor shall have a reasonable opportunity to ascertain the improper equipment or method of his contractor and to secure the substitution of safe equipment and methods.” Comment c.
- Harm Caused By Negligence Of A Carefully Selected Independent Contractor
Restatement (Second) of Torts § 416 states:
One who employs an independent contractor to do work which the employer should recognize as likely to create during its progress a peculiar risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the failure of the contractor to exercise reasonable care to take such precautions, even though the employer has provided for such precautions in the contract or otherwise.
“[T]he employer remains liable for injuries resulting from dangers which he should contemplate at the time that he enters into the contract, and cannot shift to the contractor the responsibility for such dangers, or for taking precautions against them. . . . the fact that the contract contains express stipulations for the taking of adequate precautions and that the contractor agrees to assume all liability for harm caused by his failure to do so, does not relieve his employer from the liability stated in this Section. . . . It is sufficient that it is likely to involve a peculiar risk of physical harm unless special precautions are taken, even though the risk is not abnormally great. A “peculiar risk” is a risk differing from the common risks to which persons in general are commonly subjected by the ordinary forms of negligence which are usual in the community. It must involve some special hazard resulting from the nature of the work done, which calls for special precautions.” For example,” if the principal employs an independent contractor to operate a truck this does not apply to speed, maintenance of brakes, etc., but “if the contractor is employed to transport giant logs weighing several tons over the highway, the employer will be subject to liability for the contractor’s failure to take special precautions to anchor them on his trucks. . . . It is sufficient that it is a risk which the employer should recognize as likely to arise in the course of the ordinary and usual method of doing the work, or the particular method which the employer knows that the contractor will adopt.” Comments a, c and d. Cross reference with Restatement §427, infra.
- Work Done In Public Place
Restatement (Second) of Torts 417 states:
One who employs an independent contractor to do work in a public place which unless carefully done involves a risk of making the physical condition of the place dangerous for the use of members of the public, is subject to liability for physical harm caused to members of the public by a negligent act or omission of the contractor which makes the physical condition of the place dangerous for their use.
It is not necessary for work be done under or require a franchise, license or permit, or that such a franchise, permit, or license. It is enough that the work, unless carefully done, will involve making the physical condition of the public place dangerous for the use of the public. The words “public place” denote any place includes public highways, parks and public buildings, etc.
- Maintenance Of Public Highways And Other Public Places
Restatement (Second) of Torts § 418 provides:
(1) One who is under a duty to construct or maintain a highway in reasonably safe condition for the use of the public, and who entrusts its construction, maintenance, or repair to an independent contractor, is subject to the same liability for physical harm to persons using the highway while it is held open for travel during such work, caused by the negligent failure of the contractor to make it reasonably safe for travel, as though the employer had retained the work in his own hands.
(2) The statement in Subsection (1) applies to any place which is maintained by a government for the use of the public, if the government is under the same duty to maintain it in reasonably safe condition as it owes to the public in respect to the condition of its highways.
Insofar as this section is directed to liability of governmental entities, its application is in many localities limited by statutory limitations on governmental liability. However, it may also apply to a contractor who undertakes to repair, construct, or maintain a highway, and entrusts the work to a subcontractor;
- Repairs Which Lessor Is Under A Duty To His Lessee To Make
Restatement (Second) of Torts § 419 provides:
A lessor of land who employs an independent contractor to perform a duty which the lessor owes to his lessee to maintain the leased land in reasonably safe condition, is subject to liability to the lessee, and to third persons upon the land with the consent of the lessee, for physical harm caused by the contractor’s failure to exercise reasonable care to make the land reasonably safe.
This rule “applies only where a legislative enactment imposes the duty of repair or where the lessor by a covenant in the lease or otherwise has assumed a contractual duty to make repairs.” Comment a.
- Repairs Gratuitously Undertaken By Lessor
Restatement (Second) of Torts § 420 provides:
A lessor of land who employs an independent contractor to make repairs which the lessor is under no duty to make, is subject to the same liability to the lessee, and to others upon the land with the consent of the lessee, for physical harm caused by the contractor’s negligence in making or purporting to make the repairs as though the contractor’s conduct were that of the lessor.
- Maintenance Of Structures On Land Retained In Lessor’s Possession Necessary To Tenant’s Enjoyment Of Leased Land
Restatement (Second) of Torts § 421 provides:
A possessor of land who, having leased a part of the land, is under a duty to maintain in reasonably safe condition the part retained by him, and who entrusts the repair of such part to an independent contractor, is subject to the same liability to the lessee, and to others upon the retained part of the land with the consent of the lessee, for physical harm caused by the negligence of the contractor in failing to maintain such part of the land in reasonably safe condition, as though the lessor had himself retained the making of the repairs in his own hands.
- Work On Buildings And Other Structures On Land
Restatement (Second) of Torts § 422 states:
A possessor of land who entrusts to an independent contractor construction, repair, or other work on the land, or on a building or other structure upon it, is subject to the same liability as though he had retained the work in his own hands to others on or outside of the land for physical harm caused to them by the unsafe condition of the structure
(a) while the possessor has retained possession of the land during the progress of the work, or
(b) after he has resumed possession of the land upon its completion.
This applies “only to injuries occurring while the possessor has retained possession of the premises during the progress of the work, or after he has resumed possession of the land upon the completion of the work. The rule stated in this Section has no application to injuries occurring while the land is turned over to the contractor and he is in exclusive possession of it. Thus where the employer moves out of his building and surrenders it to the contractor while it is undergoing construction, demolition, or repair, there is no liability under the rule here stated.” Comment c.
- Work Withdrawing Lateral Support
Restatement (Second) of Torts § 422A states:
One who employs an independent contractor to do work which the employer knows or should know to be likely to withdraw lateral support from the land of another is subject to the same liability for the contractor’s withdrawal of such support as if the employer had retained the work in his own hands.
“[O]ne who employs an independent contractor to do work involving excavation, or other work of a kind which the employer knows or should know to be likely to result in the withdrawal of lateral support from the land of another, is subject to the same liability for a withdrawal of such support by the contractor as if he had retained the work in his own hands.” Comment b.
- Making Or Repair Of Instrumentalities Used In Highly Dangerous Activities
Restatement (Second) of Torts § 423 provides:
One who carries on an activity which threatens a grave risk of serious bodily harm or death unless the instrumentalities used are carefully constructed and maintained, and who employs an independent contractor to construct or maintain such instrumentalities, is subject to the same liability for physical harm caused by the negligence of the contractor in constructing or maintaining such instrumentalities as though the employer had himself done the work of construction or maintenance.
This has been applied to high voltage electric lines and appliances, brakes on vehicles, explosives, radioactive materials, etc.
- Precautions Required By Statute Or Regulation
Restatement (Second) of Torts § 424 provides:
One who by statute or by administrative regulation is under a duty to provide specified safeguards or precautions for the safety of others is subject to liability to the others for whose protection the duty is imposed for harm caused by the failure of a contractor employed by him to provide such safeguards or precautions.
This has been applied to support a nondelegable duty to comply with a variety of building and safety codes.
- Repair Of Chattel Supplied Or Land Held Open To Public As Place Of Business
Restatement (Second) of Torts § 425 provides:
One who employs an independent contractor to maintain in safe condition land which he holds open to the entry of the public as his place of business, or a chattel which he supplies for others to use for his business purposes or which he leases for immediate use, is subject to the same liability for physical harm caused by the contractor’s negligent failure to maintain the land or chattel in reasonably safe condition, as though he had retained its maintenance in his own hands.
This has been applied to elevators (Gaffney v. EQK Realty Investors, 213 Ga.App. 653, 445 S.E.2d 771 (1994)), escalators, hotel water heaters, security systems, premises safety and a wide variety of other context.
- Negligence Collateral To Risk Of Doing The Work
Restatement (Second) of Torts § 426 provides:
Except as stated in §§ 428 and 429, an employer of an independent contractor, unless he is himself negligent, is not liable for physical harm caused by any negligence of the contractor if
(a) the contractor’s negligence consists solely in the improper manner in which he does the work, and
(b) it creates a risk of such harm which is not inherent in or normal to the work, and
(c) the employer had no reason to contemplate the contractor’s negligence when the contract was made.
This “collateral negligence” or “casual negligence” in the operative detail of the work, as distinguished from the general plan or method followed or the result to be accomplished. It relates to negligence which is unusual or abnormal, or foreign to the normal or contemplated risks of doing the work, as distinguished from negligence which creates only the normal or contemplated risk. Comment a.
- Negligence As To Danger Inherent In The Work
Restatement (Second) of Torts § 427 states:
One who employs an independent contractor to do work involving a special danger to others which the employer knows or has reason to know to be inherent in or normal to the work, or which he contemplates or has reason to contemplate when making the contract, is subject to liability for physical harm caused to such others by the contractor’s failure to take reasonable precautions against such danger.
This is closely related to Restatement §16. However, It is not, necessary to the employer’s liability that the work be of a kind which cannot be done without a risk of harm to others, or that it be of a kind which involves a high degree of risk of such harm, or that the risk be one of very serious harm, such as death or serious bodily injury. It is not necessary that the work call for any special skill or care in doing it. It is sufficient that work of any kind involves a risk, recognizable in advance, of physical harm to others which is inherent in the work itself, or normally to be expected in the ordinary course of the usual or prescribed way of doing it, or that the employer has special reason to contemplate such a risk under the particular circumstances under which the work is to be done. Comments a and b.
- Work Involving Abnormally Dangerous Activity
Restatement (Second) of Torts § 427A provides:
One who employs an independent contractor to do work which the employer knows or has reason to know to involve an abnormally dangerous activity, is subject to liability to the same extent as the contractor for physical harm to others caused by the activity.
This has been applied in a wide variety of cases involving premises security, explosions, structure collapses, electrocution, toxins, etc.
- Work Likely To Involve Trespass Or Nuisance
Restatement (Second) of Torts § 427B provides:
One who employs an independent contractor to do work which the employer knows or has reason to know to be likely to involve a trespass upon the land of another or the creation of a public or a private nuisance, is subject to liability for harm resulting to others from such trespass or nuisance.
This provision has been invoked in a variety of circumstances, especially in cases involving flooding, pollutants or fire spreading to another’s property.
- Public Franchise / Unreasonable Risk of Harm.
Restatement (Second) of Torts § 428 states:
An individual or a corporation carrying on an activity which can be lawfully carried on only under a franchise granted by public authority and which involves an unreasonable risk of harm to others, is subject to liability for physical harm caused to such others by the negligence of a contractor employed to do work in carrying on the activity.
Prior to adoption of the statutory employer rules in the interstate motor carrier context, this Restatement rule was used to overcome the independent contractor defense. See, e.g., Black v. Montgomery Trucking Co., Inc., 129 Ga.App. 36,(followed Restatement rule), reversed on other grounds without mention of either Restatement rule or federal statutes or regulations, 231 Ga. 211 (1973)(compare Dove v. National Freight, Inc., 138 Ga.App. 114 (1976)); Venuto v. Robinson, 118 F.2d 679 (3rd Cir., 1941)( Restatement 428 applied to hold interstate motor carrier liable for negligence of independent contractor driver); Hodges v. Johnson, 52 F.Supp. 488 (D.C.VA. 1943); War Emergency Co‑op. Ass’n v. Widenhouse, 169 F.2d 403 (4th Cir. 1948); Lehman v. Robertson Truck‑A‑Way, 122 Cal.App.2d 82, 264 P.2d 653 (Cal.App. 3 Dist. 1953); Louis v. Youngren, 12 Ill.App.2d 198, 138 N.E.2d 696 (Ill.App. 1 Dist., 1956); Eli v. Murphy, 39 Cal.2d 598, 248 P.2d 756 (Cal, 1952)(nondelegable duty of motor carrier to public).
However, some jurisdictions have declined to classify trucking as an unreasonably dangerous activity giving rise to a nondelegable duty under this statement of the Restatement, reasoning that “[t]he operation of any motor vehicle may be said to involve some risk to others but the use of [this independent contractor’s] equipment involved no more risk than that of any other.” Gaskill v. Calaveras Cement Co. 102 Cal.App.2d 120, 226 P.2d 633 (1951). Lebrun v. Stop & Shop Supermarket Co., 67 Mass.App.Ct. 1102, 851 N.E.2d 478 (Table)(Mass.App.Ct.,2006).See also, Brown v. Truck Connections Intern., Inc., 526 F.Supp.2d 920 (E.D.Ark.,2007); Walker v. Wittenberg, Delony & Davidson, Inc., 241 Ark. 525, 531, 242 Ark. 97, 412 S.W.2d 621, 625 (1967).
There are also cases holding this inapplicable to a shipper which does not have a public franchise. See, e.g., Wilson v. IESI N.Y. Corp., 444 F.Supp.2d 298 (M.D.Pa.,2006).
Exempt commodity loads. In Serna v. Pettey Leach Trucking, Inc., 110 Cal.App.4th 1475, 2 Cal.Rptr.3d 835 (2003), the California Court of Appeals held that the Restatement (Second) of Torts § 428 applied to a interstate motor carrier even though that carrier was carrying a commodity (poultry) that was exempt from the economic regulations of the DOT.
Taxi cabs. Courts in several jurisdictions have applied Restatement § 428 to operation of taxi cabs under a public franchise so that taxi companies that lease cabs to drivers as independent contractors are vicariously liable. See, e.g., Belder v. Dandridge, 2002 WL 32076963 (Va.Cir.Ct. 2002); Teixeira v. Car Cab Three, Inc., 1994 WL 413034 (Mass.App.Div. 1994); Paige v. Red Top, Inc., 255 A.2d 279 (NJ App. Div. 1969).
- Negligence In Doing Work Which Is Accepted In Reliance On The Employer’s Doing The Work Himself
Restatement (Second) of Torts § 428 provides:
One who employs an independent contractor to perform services for another which are accepted in the reasonable belief that the services are being rendered by the employer or by his servants, is subject to liability for physical harm caused by the negligence of the contractor in supplying such services, to the same extent as though the employer were supplying them himself or by his servants. Where a customer relies upon the principal to provide goods or services, and the principal substitutes goods or services from an independent contractor, the principal may be liable for the contractor’s negligence.
Conclusion. Attorneys for victims of catastrophic injuries and families of wrongful death victims facing an independent contractor defense may use this paper as a starting point for research, exploration and perhaps a bit of creativity, weaving together Restatement, statutes, regulations, local ordinances and common law to obtain fair compensation for their clients.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, a board-certified civil trial attorney of the National Board of Trial Advocacy, and lead author of Georgia Law of Torts: Trial Preparation and Practice. This blog post is adapted from a paper accompanying a presentation by Mr. Shigley at the Southern Trial Lawyers Association seminar in New Orleans in 2012.
When people call us about a potential lawsuit for wrongful death or catastrophic injury in Georgia, one of the topics they sometimes find confusing is the decision about where to file a suit.
The choice of court in which to file suit involves the interaction of subject matter jurisdiction, personal jurisdiction, and venue. In general, subject matter jurisdiction dictates which courts have the authority to hear cases regarding a generalized subject matter. Personal jurisdiction refers to the authority of a specific court to enforce its judgment as to a particular defendant. Venue rules determine the geographic location in which a particular cause of action may be tried. Individually, each of these concepts operates to limit the forum in which a case may be filed.
Georgia has 159 counties, each of which has a Superior Court. Any civil case may be filed in Superior Court, which also handles all felony criminal cases, divorces, administrative appeals, etc. Superior Courts are organized into 49 judicial circuits comprised of from one to eight counties, and ten judicial administrative districts.
Superior Court has jurisdiction over any civil damages case, plus felony criminal cases, divorces, equity, land titles, etc. In addition, 49 counties also have a State Court which has jurisdiction over civil damages cases and misdemeanor criminal cases.
Often there is only one court in which subject matter jurisdiction, personal jurisdiction, and venue can be combined. If so, the choice is simple. It may be bad, but it is simple. In other cases, there are a number of options to consider. Having identified all possible courts in which a suit may be filed, a lawyer should evaluate the advantages and disadvantages of each. The difficult choices are not between good and bad, but between good and good and between bad and bad.
The decision to file in Superior Court or State Court in a county that has both depends on local knowledge. In some counties, particularly in urban areas, most personal injury and wrongful death cases are filed in State Court. In many smaller counties, however, the conventional wisdom is that the State Courts may not have the capacity to handle large, complex civil cases.
Except as otherwise provided by the Georgia Constitution, in a civil action against a resident tortfeasor, venue is proper in the county where the defendant resides. For a person over eighteen and under no disability, that is the place where the family of the person permanently resides, if in Georgia. If a person has no family residing in Georgia, the place where that person generally lodges is considered to be that person’s domicile. That is simple in theory, but may become more complicated in sorting out the messy facts in a case.
In suits against joint tortfeasors residing in different counties, suit may be filed in the county of residence of either defendant. This provision has been held to apply only to actions in which the joint tortfeasors are residents of the State of Georgia. An insolvent estate of a deceased joint tortfeasor is not merely a nominal party, so venue may be based upon the county of the insolvent estate rather than the county of a solvent joint tortfeasor. In comparing potential counties in which to file a case, the lawyer must evaluate the reputation of the locality, its judges and jury pool.
“Vanishing venue” is a Georgia rule that a verdict or judgment against a nonresident of the forum county would become a nullity if resident defendant were dismissed prior to trial, at trial, or on appeal. One who wins a trial only to lose venue and come up empty may feel like Charlie Jones in “Peanuts” when Lucy yanks the football away before Charlie can kick it. “Vanishing venue” was eliminated in 1999 in the interest of judicial economy and efficiency, but revived in the 2005 tort reform legislation, when O.C.G.A. §9-10-31 was amended to provide:
(d) If all defendants who reside in the county in which an action is pending are discharged from liability before or upon the return of a verdict by the jury or the court hearing the case without a jury, a nonresident defendant may require that the case be transferred to a county and court in which venue would otherwise be proper. If venue would be proper in more than one county, the plaintiff may elect from among the counties in which venue is proper the county and the court in which the action shall proceed.
Under this rule, venue as to a defendant who is a resident of another county in Georgia is dependent upon the ability of the court to enter judgment as to defendant who is a resident of the forum county. In a case involving alleged joint tortfeasors, the test of whether a verdict may be obtained against a nonresident defendant is whether the verdict against the resident defendant is authorized. If the resident defendant is discharged from the action, the court is without jurisdiction to enter judgment as to the nonresident defendant. The result is that the case must be retried against the remaining defendant.
Corporations. In a suit against a domestic corporation, a foreign corporation authorized
to transact business in the state, a nonprofit corporation, or a limited liability company, venue lies in the county where the defendant “resides.” As a general rule, each of these entities is deemed to reside “in the county where its registered office is maintained, or if [a] corporation [or limited liability company] fails to maintain a registered office, it shall be deemed to reside in the county in this state where its last named registered office or principal office, as shown by the records of the Secretary of State, was maintained.”
But if a person files a tort suit against a domestic corporation, or a foreign corporation authorized to transact business in this state, venue will be proper in the county where the cause of action originated, if the corporation has an office or transacts business in that county. O.C.G.A. §14-2-510(b)(4). If venue is based solely on this paragraph, the defendant shall have the right to remove the action to the county in Georgia where the defendant maintains its principal place of business. A notice of removal shall be filed within 45 days of service of the summons. Upon motion by the plaintiff filed within 45 days of the removal, the court to which the case is removed may remand the case to the original court if it finds that removal is improper under the provisions of this paragraph. Upon the defendant’s filing of a notice of removal, the 45 day time period for filing such notice shall be tolled until the remand, the entry of an order by the court determining that the removal is valid, or the expiration of the time period for the plaintiff to file a motion challenging the removal, whichever occurs first.
Under O.C.G.A. §14-2-510(b)(4), the “principal place of business” of a corporation is deemed to be the registered office listed with the Secretary of State. After a corporate defendant has removed a case to the county where its principal office is located, a plaintiff can amend the complaint to assert facts supporting venue in the original county and the case, and move to remand to the county where the suit was filed.
When a corporation has been dissolved, and suit is later filed against it, venue is in the county in which it had its registered office before dissolution.
A foreign corporation’s residence for venue purposes in a tort case is both the county in which it has its registered office and the county in which the tort occurred if the corporation has office and transacts business in that county.
When a defendant is added as a party to a lawsuit under the relation back provision of O.C.G.A. §9-11-15(c), venue over that defendant is determined based upon the facts existing at the time the suit was originally filed, as if it were a party to the original action from the beginning.
This venue provision may provide for interesting results with regard to actions filed against foreign corporations authorized to transact business in this state. If a plaintiff files a tort action against a foreign corporation in the county in which the cause of action originated, the foreign corporation may not be able to remove the case to the county in which it has its registered office. Rather, O.C.G.A. §14-2-512(b)(4) only allows for removal within 45 days to the county in which the corporation has its “principal place of business.”
Motor Carriers cases. A lawsuit against a resident or nonresident motor common carrier or motor contract carrier may be brought in the county where the cause of action or some part thereof arose. If the motor carrier or its agent is not capable of being served in that county, “a second original may issue and service be made in any other county where the service can be made upon the motor carrier or its agent.” Unlike the venue provision for actions against railroads and electric companies, the venue prescribed by O.C.G.A. §40-1-117 is not exclusive. That is, “venue [as to a motor carrier] can be predicated upon any statute which is otherwise applicable.”
O.C.G.A. §40-2-140 authorizes a direct action against the insurer for a motor carrier. The joinder provision in the direct action statute permits a plaintiff to join a motor carrier’s insurance company in the same action as a motor carrier. However, a motor carrier and its insurer are not considered joint tortfeasors or joint obligors, so proper venue as to one defendant is not necessarily proper venue as to the other, and the direct action against the insurer is an independent proceeding on the insurance contract with venue subject to an independent determination. The insurance code allows a plaintiff to sue an insurer in any county where the company has an agent or place of doing business or any county where such agent or place of doing business was located at the time the cause of action accrued or the contract was made, out of which the cause of action arose. The contract action against the insurer of a motor carrier on the policy itself “is cognizable as an independent suit without joinder of the motor carrier.” Therefore, the plaintiff may bring a direct action against the motor carrier’s insurer alone, in any county where venue is proper as to the insurer.
Insurance companies. Suits against insurers may be filed in any of the following counties: (1) where the principal office of the company is located; (2) where the company has an agent or place of doing business; (3) where an agent or place of doing business was located at the time the cause of action accrued or the contract was made out of which such cause of action arose; or (4) where the insured property is located or where the insured person maintains his legal residence. Personal property is deemed to be located in the county of the legal residence of the owner. The Office of Insurance and Safety Fire Commissioner’s web site includes an insurer search feature. Upon retrieving information about an insurance company, the web site allows a search for agents (including full agent contact information) by city and state.
Venue for nonresidents under the long-arm statute. When jurisdiction over a nonresident of the state is predicated upon the provisions of Georgia’s long-arm statute, “venue … shall lie in any county wherein a substantial part of the business was transacted, the tortious act, omission, or injury occurred, or the real property is located.” In addition, when a suit is brought against a resident of the State of Georgia, any nonresident of the state “who is involved in the same transaction or occurrence and who is suable under the provisions of [the Georgia long-arm statute] may be joined as a defendant in the county where a resident defendant is suable.” Under this provision, jurisdiction and venue over the nonresident defendant “shall not be affected or lost if at trial a verdict or judgment is returned in favor of such resident defendant.” If the resident defendant is dismissed from the action prior to the commencement of trial, the action shall be transferred to a county wherein venue is proper. One claiming lack of venue has the burden of proving it by competent evidence.
Venue under the Georgia Nonresident Motorist Act. In a suit brought by a resident plaintiff under Georgia’s Nonresident Motorist Act, the resident plaintiff may file suit either in the county where “the accident or injury occurred or the cause of action originated, or in the county of the residence of the plaintiff.” But if the plaintiff is a nonresident of the state, the action may be brought only in the county where “the accident or injury occurred or the cause of action originated.”
When suit is filed against a resident of the State of Georgia for damages resulting from a motor vehicle accident or collision occurring in Georgia, venue is proper only in the county where the resident defendant resides. If a nonresident of the state is also involved in that same collision and that nonresident is suable under Georgia’s Nonresident Motorist Act, the nonresident may be joined as a defendant in the county where the resident defendant resides. But unlike the venue provisions relating to resident joint tortfeasors, a jury verdict in favor of the resident defendant does not deprive the court of jurisdiction or venue as to the nonresident defendant.
However, the Nonresident Motorist Act does not apply when the defendant is a resident of Georgia at the time of the tort. Police officers may write on the accident report the address that appears on a driver’s license, which may not be a current residence address at that time. At the time suit is filed, particularly against a defendant who has moved out of state, it may be difficult to determine with certainty whether the defendant was a resident of Georgia at the time of the collision. That is particularly common among youthful or transient drivers who leave few if any footprints in residential leases, utility accounts, or other documented indicia of residency. Therefore, it is a prudent practice to serve such a defendant under both the Nonresident Motorist Act and the Long Arm Statute in a county that would be proper under the residency scenario that seems most probable, conduct prompt discovery, and be prepared to transfer the case to another county where venue would be proper if residency is other than it first appears.
Sojourners and transients. Sojourners are nonresidents who are passing through or sojourning temporarily in the state. Venue as to a nonresident of Georgia, passing through or sojourning temporarily in the state, may be in any county in which he may be found at the time when the action is brought.” Transients are persons who, for reasons of business or pleasure, frequently change residence. If a person resides indifferently at two or more places in Georgia, that person may elect which of such places shall be his domicile. If such an election is made known generally among those with whom he transacts business in this state, that place is his domicile. If no such election is made, or if an election is made but is not generally known among those with whom he transacts business in Georgia, third persons may treat any one of the places in which the person resides as his domicile. A person who habitually resides a portion of the year in one county and another portion of the year in another, such as a college student who moves back to the parental home during the summer, is a resident of both, and may be served in either county. A transient who has no family permanently residing at one place in this state may be sued wherever they are temporarily staying even if they have no intention of remaining there.
State government agencies and authorities. The Georgia Tort Claims Act requires that all tort suits against the state under that statute must be filed “in the state or superior court of the county wherein the loss occurred.” This has been construed to mean that if an injury occurs in one county, any of the hospitalization is in another county, and further hospitalization or death occurs in yet another county, venue may be proper in any of those counties. Thus, if a state agency is properly a defendant in a crash occurring in rural Talliaferro County, the injury victim is transported to a hospital in Augusta (Richmond County) and later transferred to specialized spinal cord or brain injury rehabilitation in at Shepherd Center (Fulton County), venue would be proper in Fulton County.
The statute also provides that “in any case in which an officer or employee of the state may be included as a defendant in his individual capacity, the action may be brought in the county of residence of such officer or employee.” Any tort action against the state for losses sustained in any other state must be filed “in the county of residence of any officer or employee residing in this state upon whose actions or omissions the claim against the state is based.” This limitation on venue is a constitutionally valid condition on the waiver of sovereign immunity. When a tortious injury occurs in one county, and the victim dies from the injury in a second county, venue for the wrongful death claim is in the county where the death occurred.
Many constitutional amendments and statutes concerning local government authorities, e.g., industrial authorities, development authorities, housing authorities, water and sewer authorities, airport commissions, etc., which are not published in the Code, may include special venue provisions. The Department of Community Affairs maintains a registry of such authorities. In preparing to file suit against any such authority, counsel must research the law that created it. For example, suits against the Metropolitan Atlanta Rapid Transit Authority alone must be filed in the Superior Court of Fulton County, but when MARTA is alleged to be a joint tortfeasor it may be sued in the county of the co-defendant’s residence.
Federal courts. Most plaintiffs lawyer most of the time prefer to avoid federal court for a number of reasons that are beyond the scope of this article. However, when there is federal diversity jurisdiction, a lawyer should weigh the options. If in such a case, the state venue would be in a small county with great potential for “home cooking,” or when a suit filed in a state court of an urban county would likely be removed to federal court by the defendant, filing in federal court may be the best option.
Georgia has three federal judicial districts – Northern, Middle and Southern. Despite the names, these districts slice the Georgia map diagonally. The Northern District is oriented diagonally across the north and west of the state, and includes divisions based in Atlanta, Rome, Gainesville and Newnan. The Middle District stretches from the southwest corner of the state to the South Carolina line, with seven divisions based in Macon, Columbus, Athens, Americus, Albany, Valdosta and Thomasville. The Southern District spreads inland from the Atlantic Ocean and Savannah River, and includes divisions based at Savannah, Augusta, Dublin, Waycross, Brunswick and Statesboro.
Local rules of federal district courts allow filing in the division in which a Georgia resident defendant resides or the division in which the cause of action arose. Thus, for example, if a fatal crash occurs in Burke County in the Augusta Division of the Southern District, and the defendant resided in Bulloch County in the Statesboro Division of the Southern District, the plaintiff could choose to file in federal court in either urban / suburban Augusta or the rural Statesboro Division. Similarly, if a defendant resides in rural Chattooga County in the Rome Division of the Northern District but the crash occurs in suburban Cobb County in the Atlanta Division, the plaintiff may file suit in federal court in Atlanta.
The ancient Chinese military strategist Sun Tzu in The Art of War wrote of the necessity of using local guides. That is a necessity.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, a board-certified civil trial attorney of the National Board of Trial Advocacy, and lead author of Georgia Law of Torts: Trial Preparation and Practice.
A few times every year, parents of college students considering law school ask me to talk with their offspring about which Georgia law schools they should consider. Before responding to that question, there is always a conversation about why they want to go to law school, priorities in life, and other options for life and career.
There is always a full disclosure of my bias. I graduated from Emory Law School in Atlanta and have remained involved with Emory in various capacities over the years.
If the prospective law student cannot be dissuaded from the idea of law school, and is still passionate about a legal career and a focus on Georgia, I discuss other factors for selection of a law school. Here are a few.
- The student’s aspirations. A student who truly wants to be a practicing lawyer in Georgia may do well as a graduate of virtually any law school, particularly those in Georgia and neighboring states. I know a lot of good Georgia lawyers who came here and took the bar exam after graduating from law school elsewhere. By the time one has been in practice ten years, most everything of practical value that one uses was learned after law school.
For one who might aspire to teach in a law school someday, clerk for a federal judge or appellate judge, or practice at a silk stocking law firm, the first choice might not be John Marshall or its Savannah branch. They offer opportunity for a legal career to students who might not get in elsewhere. The have some great professors and produce lawyers who do good work in the trenches. But the don’t appeal to legal snobs.
One who might want to become a law professor or depart the jurisdiction upon graduation might focus on a school that is better known nationally. In Georgia, those are primarily Emory University (ranked #22 nationally in the U.S. News survey) and the University of Georgia (#33 in U.S. News rankings), though Georgia State is rising fast.
- Reputation among lawyers and judges in Georgia. The University of Georgia, Emory and Mercer have strong reputations and alumni networks among Georgia lawyers and judges. Georgia State University Law School had its first graduating class in 1984, and has come on strong. Though it is not well known outside Georgia (#57 in US News rankings), its alumni network is growing and its reputation among practicing lawyers and judges inside Georgia makes it highly competitive here.
- Cost. If availability of a wealthy grandparents or a family trust fund makes cost irrelevant, skip past this item. I was not in that category. But when I went to Emory Law School, the tuition cost was about $2,500 per year, more than a state school at the time but still manageable. I chose Emory because I wanted to be in Atlanta, it was the only nationally accredited law school in Atlanta at the time, and Georgia State’s law school was still a much-debated proposal. I graduated with debt of approximately $8,500 and paid it off within four years as an Assistant District Attorney and in small town general practice. Adjusting for inflation, that would be about $33,750 in 2016 dollars.Now tuition alone is $51,510 per year at Emory and $37,260 per year at Mercer. That does not include the cost of living. New graduates often emerge with $150,000 to $200,000 in student debt. That crushing financial burden severely constricts a graduate’s career choices, and may defer personal goals such as buying a home, starting a family and launching one’s own practice.At the other end of the cost spectrum, a student could go law school part-time in the evening at Georgia State while holding a day job, and graduate with little or no debt. Moreover, if a student is married and the spouse’s income is important, the job market in Atlanta, compared to Athens or Macon, may be a factor.That is why I often counsel prospective law students to consider the value proposition at Georgia State. However, GSU’s admissions standards have risen. One recent survey rated Georgia State as #21 on a list of the hardest law schools to get into.
- Availability of programs directed toward a desired specialty. I mention this factor only in passing because a J.D. is a J.D. Everyone takes the same core courses. While one may aspire to a particular career focus and set off in that direction, that may not be where job opportunities are available. No matter what one aspires to at 22, most lawyers wind up in practice areas where they can find a job that will pay their bills. It is common for a student to plan on a glamorous career in, for example, international arbitration, but wind up prosecuting DUI cases or defending car wreck cases for an insurance company. (There are only a handful of lawyers in Georgia who make a living in international arbitration while others aspire to get into it.) However, a prospective student may want to examine how specific course offerings may match the student’s strong background and interests.
- Commitment of the law school’s leadership to Georgia. At the risk of being too parochial, one might also consider whether the law school’s faculty and dean are committed to maintaining strongly positive relationships with the bench and bar in Georgia. While it is good for law schools to recruit the best and brightest faculty from across the country, the individual student may also think about whether it is relevant to her to have professors and deans committed to Georgia practitioners in the long term. I’ve not taken the time to dig through faculty profiles to see how many professors from other places have bothered to become Georgia lawyers. Since leadership counts, I’ve just looked at the deans.
Some legal academics who move into a state from elsewhere place a high priority on cultivation of good relationships with trial court judges, bar leaders and practicing lawyers across the state. Others are totally centered on the academy and seldom condescend to mix with mere mortals in the bar. That is their choice. However, it is not terribly burdensome for legal academics moving into Georgia to be admitted to practice here, as they may be admitted by motion without taking the bar exam if they have been in active practice 5 of the previous 7 years (including judicial clerkships, teaching, government and in-house counsel jobs), pass the character and fitness background check, and pay a $600 fee.
Mercer University. Dean Daisy Hurst Floyd received her B.A. and M.A. in Political Science from Emory University and her J.D. from the University of Georgia School of Law. After graduating from law school, she practiced law in Atlanta with the firm of Alston, Miller, and Gaines, and then served on the faculties of the University of Georgia School of Law and Texas Tech University School of Law before going to Mercer Law School in 2004. She was admitted to practice in Georgia in 1980, and has long been an active participant in the Bar, building strong relationships among Georgia lawyers and judges.
Emory University. Dean Robert Schapiro graduated from Yale (B.A., 1984), Stanford (M.A., 1986) and Yale Law School (J.D., 1990) where he was editor-in-chief of Yale Law Journal. He for a federal district judge in New York and for Justice John Paul Stevens of the US Supreme Court. He worked with the law firm of Sidley & Austin in Washington, DC, where he practiced general and appellate litigation. He taught two years at Duke Law School before coming to the Emory faculty in 1995, and became Dean in 2012. He was admitted to the Georgia Bar in 2005. As Dean, he and his wife regularly attend functions in the legal community in Georgia, and cultivate relationships in the legal community. He is a team player on various boards of legal organizations in Georgia.
Georgia State University. Dean Steven J. Kaminshine earned his undergraduate degree in history (summa cum laude) from New York University, and earned his J.D., with honors, from DePaul University School of Law where he served on the DePaul Law Review. Before joining the faculty, Dean Kaminshine was a partner in a labor and employment law practice in New York City and spent three years at the National Labor Relations Board in Washington D.C. A member of the Georgia State faculty since 1985, and Dean since 2005, he is not been admitted to practice law in Georgia. However, as an academic he has been active with the Labor and Employment Sections of the Georgia and Atlanta Bars and has twice chaired the Atlanta bar’s section. He is a past president of the Southeastern Association of Law Schools, and serves on its executive board.
John Marshall Law School (Atlanta) and Savannah Law School. John Marshall and its Savannah branch, Georgia’s only for-profit law school, has a new dean, Malcolm L. Morris. He is a graduate of Cornell University (B.S.), SUNY Buffalo (J.D.), and Northwestern University (LL.M.). He was previously Interim Dean at Northern Illinois University College of Law and professor at John Marshall Law School in Chicago. He has not been admitted to practice law in Georgia and so far in his new job has a low profile in bar-related organizations.
University of Georgia. Peter B. “Bo” Rutledge became Dean in 2014, chosen by a university search committee chaired by the dean of the school of pharmacy and assisted by the university’s Human Resources office. He holds a B.A. magna cum laude from Harvard University (1992), an M.Litt. in Applied Ethics from the University of Aberdeen (Scotland) and a J.D. with high honors from the University of Chicago, where he served as executive editor of The University of Chicago Law Review and was inducted into the Order of the Coif. He served as a law clerk at the U.S. Supreme Court for the Justice Clarence Thomas and at the U.S. Court of Appeals for the 4th Circuit for then-Chief Judge J. Harvie Wilkinson III. After his clerkships, he remain in Washington, DC, where he worked at the law firms of Freshfields Bruckhaus Deringer (1999-2001) where his practice concentrated on international arbitration, and Wilmer Cutler & Pickering (now Wilmer Cutler Pickering Hale and Dorr)(2001-03), where his practice included international dispute resolution and Supreme Court matters. Before joining the UGA faculty in 2008, he taught five years at Catholic University of America Law School (2003-08). In 2010-11, he was a Fulbright Professor at the Institut für Zivilverfahrensrecht at the University of Vienna Law School. Widely published himself, he has placed a strong emphasis on faculty scholarship, publications and placement of graduates in judicial clerkships. He is admitted to practice in Maryland, the District of Columbia, and various federal appellate courts, but after eight years at the University of Georgia he has not chosen to be admitted to practice law in Georgia. He could be a candidate for a deanship at more prestigious law schools within a few years.
All things considered, I advise students to choose a law school where one can both get a good education and graduate without burdensome debt. If cost is not a factor due to scholarship awards or strong family resources, it is really a matter of personal choice, though my personal bias is in favor of my alma mater, Emory. If a student would incur heavy debt attending any other law school, I suggest Georgia State.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, and a board-certified civil trial attorney of the National Board of Trial Advocacy. He graduated from Furman University and Emory University Law School.
Every summer there are far too many instances of children dying when left in a hot vehicle. One such tragedy involving a child care center without adequate insurance led to a claim against a city government for negligent licensing of the child care center.
Many child care centers in Georgia have no liability insurance because child care centers in Georgia are not required to carry any specific amount of liability insurance. The regulations governing Family Child Care Learning Homes require only “notification of the absence of a liability insurance policy sufficient to protect its clients,” though the amount of insurance that would be sufficient is never defined. The Rules for Child Care Learning Centers require only that a program seeking an exemption from licensure “shall comply with the requirements regarding notification to parents of enrolled children if the program does not carry liability insurance.” Parents are asked to sign an acknowledgment that the center “does not carry liability insurance sufficient to protect my children in the event of an injury, etc.”
When I was chairman of the board of directors of a non-profit, church-based child development center, we carried substantial liability insurance, adopted strict policies and procedures, and installed state of the art security technology. We were a rare exception.
In the recent case of Calloway v. City of Warner Robins, 336 Ga.App. 714, 783 S.E.2d 175 (2016), a three-year-old child died of heat stroke when left in a hot vehicle for several hours while in the care of workers a child care center. Lacking effective recourse against the child care center and its employees, the parents included as defendants the City of Warner Robins and the city clerk for negligence in issuance of a business license without following certain procedures.
The Court of Appeals (McFadden, J.), held that the city was protected by sovereign immunity because a “municipality’s act of granting or revoking a business license constitutes a governmental function,” even if the issuance of the license was negligent. Likewise, the city clerk who was sued only in his official capacity was protected by sovereign immunity.
From time immemorial the doctrine of sovereign immunity has restricted citizens’ rights to seek legal redress against the government for its wrongdoing. Georgia has subscribed to the doctrine of sovereign immunity since 1784, when it was adopted by statute from the common law of England. The concept of sovereign immunity is a carryover from the quaint legal fiction that “the King can do no wrong,” which survived the transition from individual absolute sovereign to representative democracy. Limiting the governmental treasury’s exposure to tort liability is the more contemporary justification for the rule.
Whatever the rationale, through most of Georgia’s history, the state enjoyed almost complete immunity for the wrongs of its agents. Sovereign immunity is recognized to be “a harsh doctrine, not an equitable one.” Indeed, it is just the opposite of equity–it is the state declaring that it cannot be sued even where it would otherwise be liable.
The extent to which governmental entities receive the protections of sovereign immunity varies, depending on the type of entity involved and the type of negligence claimed. Generally speaking, the state is subject to a broader waiver of sovereign immunity than counties and municipalities, with the prevailing law being that the state waives immunity unless liability is specifically excluded by the Georgia Tort Claims Act.
The inverse is true of counties and municipalities, which require a specific statutory waiver before they can be liable. In addition to the government’s own immunity, government officials enjoy personal immunity for their allegedly wrongful acts, referred to as official, or qualified, immunity, which is not absolute, but protects them from the burdens of liability and litigation in many circumstances.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, and a board certified civil trial attorney of the National Board of Trial Advocacy. His statewide law practice is based in Atlanta.
About once a month I get a call from an attorney in another state asking about the procedure for making injury and death claims against Georgia state government. Too often they are disappointed to learn that their letters to and correspondence with a claims adjuster for the state was not adequate notice of the claim. If a year has passed without sending notice of claim in proper form, their clients are out of luck. More than once, I have gently suggested that a lawyer notify his legal malpractice insurance carrier.
Once again, on May 17, 2016, the Georgia Court of Appeals reiterated the old story that the ante litem notice of claim requirement of O.C.G.A. § 50-21-26 is strictly construed and correspondence with the state’s claims adjuster is not good enough.
In Callaham v. Georgia Ports Authority, 337 Ga.App. 120, 786 S.E.2d 505 (2016), Judge Chris McFadden wrote for the court in a case in which the injured plaintiff contended that correspondence with the Risk Management Division of the Department of Administrative Service (DOAS) and a claims adjuster satisfied the ante litem notice requirement. Once again, a lawyer unfamiliar with the details of the Georgia Tort Claims Act fell through a procedural trap door, taking his client with him.
In the Callaham case, the plaintiff was injured at the Georgia Ports Authority terminal in Savannah. His lawyer sent a representation letter to the Ports Authority’s claims adjuster providing information, pretty much as one would in any other car wreck case. Later the lawyer sent a notice of claim letter by certified mail to the DOAS Risk Management Division.
However, he did not send the ante litem notice to the Ports Authority or comply with other details of O.C.G.A. § 50-21-26, which mandates the following requirements:
(a) No person, firm, or corporation having a tort claim against the state under this article shall bring any action against the state upon such claim without first giving notice of the claim as follows:
(1) Notice of a claim shall be given in writing within 12 months of the date the loss was discovered or should have been discovered; provided, however, that for tort claims and causes of action which accrued between January 1, 1991, and July 1, 1992, notice of claim shall be given in writing within 12 months after July 1, 1992;
(2) Notice of a claim shall be given in writing and shall be mailed by certified mail or statutory overnight delivery, return receipt requested, or delivered personally to and a receipt obtained from the Risk Management Division of the Department of Administrative Services. In addition, a copy shall be delivered personally to or mailed by first-class mail to the state government entity, the act or omissions of which are asserted as the basis of the claim. Each state government entity may designate an office or officer within that state government entity to whom a notice of claim is to be delivered or mailed;
(3) No action against the state under this article shall be commenced and the courts shall have no jurisdiction thereof unless and until a written notice of claim has been timely presented to the state as provided in this subsection;
(4) Any complaint filed pursuant to this article must have a copy of the notice of claim presented to the Department of Administrative Services together with the certified mail or statutory overnight delivery receipt or receipt for other delivery attached as exhibits. If failure to attach such exhibits to the complaint is not cured within 30 days after the state raises such issue by motion, then the complaint shall be dismissed without prejudice; and
(5) A notice of claim under this Code section shall state, to the extent of the claimant’s knowledge and belief and as may be practicable under the circumstances, the following:
(A) The name of the state government entity, the acts or omissions of which are asserted as the basis of the claim;
(B) The time of the transaction or occurrence out of which the loss arose;
(C) The place of the transaction or occurrence;
(D) The nature of the loss suffered;
(E) The amount of the loss claimed; and
(F) The acts or omissions which caused the loss.
(b) No action may be commenced under this article following presentation of a notice of claim until either the Department of Administrative Services has denied the claim or more than 90 days have elapsed after the presentation of the notice of claim without action by the Department of Administrative Services, whichever occurs first.
The Supreme Court and Court of Appeals have consistently required strict compliance with this notice procedure. Even actual notice to the state agency is not sufficient to overcome the strict procedural requirements. Within twelve months of the incident, notice must be delivered in person or by certified mail or statutory overnight delivery, e.g., FedEx, to both the Department of Administrative Services Risk Management Division and the designated officer (usually commissioner or general counsel) of the state agency involved.
A substantial body of case law makes it clear that notice to a claims adjuster or attorney for the state is not good enough.
The ante litem notice must provide the listed information, including an amount of claim. Sometimes, if the extent of damage is undetermined, lawyers just state the amount as the per person cap under the statute, $1,000,000 as a place holder.
The Georgia Tort Claims Act was enacted in 1992, waiving sovereign immunity up to $1,000,000 per person and $3,000,000. While providing a means for compensation in state tort claims, it is riddled with exceptions, exclusions and procedural trip wires and trapdoors for the unwary. Any lawyer who is not familiar with it, absolutely must study the statute and case law interpreting it in exhaustive detail. Even those of us who have worked with it for decades must review it every time we handle a state tort case.
From the early 1980s until after passage of the Georgia Tort Claims Act in 1992, much of my work at an insurance defense firm involved defense of tort cases for the Georgia Department of Administrative Services Risk Management Division, working closely with the Attorney General’s office in defense of state officials and employees. In Hartley v. Agnes Scott College, 295 Ga. 458, 759 S.E.2d 857 (2014), the Supreme Court quoted my book describing the system prior to 1992:
Prior to enactment of the GTCA, tort claims were brought against individual state employees and officials rather than the state agencies, and funds were allocated by the state to pay settlements or judgments against employees and officials within the course and scope of their duties. The GTCA reversed this scheme, so that claims are brought against agencies rather than individual employees and officials.
After the Georgia Tort Claims Act became law, the Attorney General decided that outside lawyers defending cases for the state had to become Special Assistant Attorneys General, working at SAAG rates which were much lower than I had been billing. I thanked him for the honor but, needing to feed a growing family, declined. Since then, I have handled personal injury and wrongful death cases against the state.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway and Premises Liability Section, and a board certified civil trial attorney of the National Board of Trial Advocacy. His statewide law practice is based in Atlanta.
Statute of limitation tolled for crime in tort suit against other parties even if criminal never prosecuted
When an injury or death claim arises from a crime, in Georgia the clock stops on the statute of limitation up to six years when a criminal prosecution is not complete. That extension of the limitation period now applies to other defendants in the civil case, even if the criminal is never caught and prosecuted.
In July 2016, the Georgia Court of Appeals used textual analysis of a statute to overrule prior court decisions and reach this conclusion.
In Harrison v. McAfee, 2016 WL 3654284, decided July 7, 2016, Judge Nels Peterson analyzed the text of O.C.G.A. § 9-3-99 to overrule a series of earlier court decisions and hold that this statute tolling the time limit for filing suit “applies regardless of whether the defendant in the case has been accused of committing the crime from which the cause of action arise.”
Thus, the textual analysis methodology of the late U.S. Supreme Court Justice Antonin Scalia was applied by a young conservative judge, a product of Harvard Law School and the conservative Federalist Society, to slightly broaden the rights of tort plaintiffs in Georgia.
O.C.G.A. § 9-3-99 provides:
The running of the period of limitations with respect to any cause of action in tort that may be brought by the victim of an alleged crime which arises out of the facts and circumstances relating to the commission of such alleged crime committed in this state shall be tolled from the date of the commission of the alleged crime or the act giving rise to such action in tort until the prosecution of such crime or act has become final or otherwise terminated, provided that such time does not exceed six years.
Parsing definitions of the word “any” in the code section, Judge Peterson concluded that “the statute applies to any cause of action in tort, without limitation, so long as that cause of action is brought by a crime victim and ‘arises out of the facts and circumstances relating to the commission of such alleged crime.’”
Therefore, the statute tolled the two-year limitation period for the negligence security personal injury claim against a bar owner by a plaintiff who was injured in a criminal assault in a bar, even though the criminal was never apprehended and prosecuted.
Since two other judges concurred in the judgment only, this decision is “physical precedent only” rather than binding precedent. However, the reasoning applied and respect for Judge Peterson’s intellect may make it persuasive to other judges.
The impact on both negligent security and truck crash cases is not hard to imagine. Often in truck wreck cases, law enforcement withhold access to investigative reports while the criminal case is not concluded. Some District Attorneys cooperate with victims’ attorneys by opening their files but some do not. Under the Harrison decision, the limitation period would be tolled in a claim against a trucking company and others while prosecution of the truck driver is still open.
Similarly, as in the Harrison case, when there is a claim against a business for failure to provide adequate security, the limitation period would be tolled even if a criminal assailant is not caught and prosecuted. Such cases may include shootings and sexual assaults in apartment complexes, hotels and motels.
Every legal claim has a time limit. The reasons for statute of limitation are that a plaintiff with valid claim should pursue it with reasonable diligence, with passage of time evidence of a stale claim may be lost with passage of time, and that prosecution of a long-dormant claim may involve “more cruelty than justice.”
In Georgia, the limitation period for personal injury, wrongful death and medical malpractice claims is two years. However, there are several legal rules for stopping the clock or “tolling” the statute of limitations. Those include minority of the victim, which stops the clock until the 18th birthday so that suit must be filed by the 20th birthday); fraud that prevented the victim from filing suit; unrepresented estate of deceased claimant, tolling limitation period for five years; and unresolved crime that gives rise to the civil claim.
While I would seldom recommend delaying suit for years while waiting for conclusion of a criminal prosecution, there are times when it would be prudent. The Harrison decision provides one more arrow in the quiver in such situations.
Ken Shigley is a past president of the State Bar of Georgia, past chair of the American Association for Justice Motor Vehicle Collision, Highway & Premises Liability Section, and lead author of Georgia Law of Torts: Trial Preparation & Practice. A former prosecutor, he was appointed by Gov. Nathan Deal to the Criminal Justice Reform Council. His law practice is based in Atlanta.