Subject Matter: Tennessee Civil Justice Act - 10-1-11
We’ve been reporting for the past several years about the tort reform efforts in Tennessee and now I’m pleased to remind you that The Tennessee Civil Justice Act of 2011 will become effective 10-1-11 and apply to all liability action for injuries, deaths and losses covered by the act which accrue on or after that date.
I’m attaching a copy of the final bill – Public Chapter 510 and the legislative summary I sent earlier.
It is our opinion, based on the decrease in level of patient care liability actions since the amendments to the medical malpractice act and data from other jurisdictions post-reform that Tennessee that the there will be tort reform driven reduction in liability costs and severity and frequency of claims. The pre-suit notices and lawsuits filed against health care providers through 2011 will likely not be affected by the act. However, by June 2012, most claims and potential claims will be covered by this legislation and by October 2012, most all pre-suit notices and lawsuits against health care providers will be governed by the act.
The constitutionality of the act is expected to be the challenge in t he next year or two as has occurred in other states that placed limits on non-economic and punitive damages (challenges based upon right to a jury trial, equal protection, separation of powers, due process). Of the states that have had constitutional challenges, at least 17 have upheld the constitutionality and at least 9 have determined the laws unconstitutional. We’ll report further on those issues.
The highlights of the reform are:
Compensatory Damages: The legislation divides compensatory damages into two general categories: economic ("objectively verifiable pecuniary damages") and noneconomic (claims for pain and suffering, disfigurement or disability and the pleasures of life, as well as derivative claims not involving direct physical injury, such as loss of consortium).
Caps on Noneconomic Damages: In most cases, there will be a $750,000 cap on noneconomic damages in personal injury lawsuits. A $1,000,000 cap will apply to certain types of catastrophic injuries such as paraplegia or quadriplegia resulting from spinal cord injuries, amputations, injuries resulting from third degree burns to 40 percent or more of the body or face, or the wrongful death of a parent leaving surviving minor children.
Limitations on Capped Damages:
A single plaintiff can’t recover separate capped damages from separate defendants, regardless of what kind of tort case is alleged. If there is more than one defendant found to be at fault for damages, the defendants will bear a proportionate share of damages. For noneconomic damages, the collective exposure in most cases will be $750,000 to $1,000,000 depending upon the nature of the injury. Each injured plaintiff can recover damages, but derivative damages, such as loss of consortium, are subject to the overall cap applicable to the directly injured party.
Exceptions to Caps on Damages: There are a few exceptions to caps for noneconomic injuries, essentially revolving around intentional wrongdoing or where the defendant’s judgment was substantially impaired by alcohol or drugs. One potential problem area for facilities maintaining voluminous records with many provider entries will be an exception to the caps for claims where the defendant is found to have intentionally concealed, altered or destroyed records with the purpose of avoiding or evading liability.
Punitive Damages Cap:
Punitive damages for all cases will be capped at an amount not to exceed the greater of twice the total of compensatory damages, or $500,000, whichever is greater. As with compensatory damages, there are limited exceptions to the punitive damages cap, for the type of intentional conduct applicable to the compensatory damages caps discussed above.
Please refer to the Legislative Summary attached for more detailed information about the legislation that is expected to impact Tennessee’s health care providers.
Let us know if we can answer any questions or provide more information. We will keep you closely posted as the act becomes effective.
Firm/Company: Adelman Law Firm PLLC
Document Date: January 1, 1970
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