California Appellate Lawyer Blog

The recent appellate opinion in Corenbaum v. Lampkin (filed 4/30/13) 2013 DJDAR 5591 answers "no" on all counts. The California Court of Appeal, Second Appellate District, Division Three, determined that only the actual amount paid for past medical care (here, as is typical, the discount rate paid by the medical insurer) is relevant and admissible. The court acknowledges that in ruling this full-billing evidence inadmissible for all of these purposes, it plows new ground, beyond the holding of the California Supreme Court in Howell v. Hamilton Meats & Provisions, Inc. (2011) 52 Cal. 4th 541. There, the state high court took the minority view among U.S. jurisdictions in holding that an injured plaintiff may not recover as past economic damages more than the amount paid by medical insurance--the full amount of medical billing was not recoverable as past medical expense damages; the court "expressed no opinion as to its relevance or admissibility on other issues, such as noneconomic damages or future medical expenses."( Id., at p. 567.) Allow me to discuss briefly the underpinnings from Howell, how the Corenbaum court navigated its conclusion, and what might lie ahead.

In Howell, the Supreme Court had before it the following: the trial court had admitted evidence of the full medical billings, but granted the defense motion to reduce the medical damage award to reflect the amount actually accepted by medical providers as full payment (per Hanif v. Housing Authority (1988) 200 Cal.App.3d 625); the Court of Appeal reversed, holding the reduction violated the collateral source rule. The Supreme Court held: [W]e merely conclude the negotiated rate differential--the discount medical providers offer the insurer--is not a benefit provided to the plaintiff in compensation for his injuries and therefore does not come within the rule." (Howell, at p. 566.) Thus the trial court in Howell had properly reduced the past medical award post-verdict.

The Corenbaum court recognized the Howell court did not hold that full amount billed was inadmissible to prove past medical expenses, let alone that it was not at all relevant to prove future medicals and/or pain and suffering. It however theorized that because plaintiff can recover as past special damages no more than the amount incurred for past medical services, the value of those services exceeding what was paid is irrelevant and inadmissible to prove the past specials. As to future medical expenses, it reasoned that the billing rate not paid would be an improper foundation for an expert to use to project future medical expenses. Finally, because pain and suffering is so difficult to assess, any attempt to use the otherwise irrelevant "full amount billed" to gauge pain and suffering would be improper.

Continue reading "Is the full amount billed for medical care admissible at personal injury trial to prove past medical, future medical or general damages? " »

"[A]nimals are special, sentient beings, because unlike other forms of property, animals feel pain, suffer and die." With words like these, the California Court of Appeal, Second Appellate District, Division One, rejected defendants argument, an argument accepted by the trial courts, that the measure of damages are limited to the market value of the injured dogs in Martinez v. Robledo (filed October 23, 2012) 2012 DJDAR 14708.

This opinion involved consolidated matters: (1) In Martinez v. Robledo, defendant shot his next door neighbor's (Plaintiff's) dog (Gunner, a two-year-old German Shepherd), causing the amputation of Gunner's right leg; plaintiff seeks recovery of the vertinary bills of $20,789.81 plus punitive damages. (2) In Workman v. Klause, plaintiff's 9-year-old Golden Retriever, Katie, received surgery from defendant veterinarian at a cost of $4,836.16; Katie's intestine was nicked during the surgery and a piece of surgical gauze was left in her body causing an infection; plaintiff's incurred emergency bills elsewhere in the sum of $37,766.06 in order to save Katie's life; plaintiff sued for this later sum, defendant having already refunded to plaintiff monies for his professional charges.

In both cases, defendants were granted motions in limine, limiting the matters that would be admissible to prove damages, and the trial courts ruled that the measure of damages would be limited to the fair market value of the dogs. Plaintiffs appealed each of their cases (in which their damage recovery was $1,000 fair market value) claiming pets are and should be treated fundamentally more significant than mere personal property, relying upon the First Appellate District case of Kimes v. Grosser (2011) 195 Cal.App.4th 1556. (A discussion of that appellate ruling concerning injuries to pet cat "Pumpkin," including potential punitive damages, appears in the June 16, 2011 blog.) As alluded to above, the Second Appellate District panel here agreed with both plaintiffs and the Kimes opinion.

Two things seem apparent from these opinions. First, veterinarians may find their malpractice premiums rising significantly. Second, appellate justices appear to be more attached to their household critters than the trial judges who rendered the trial court rulings.

The California Supreme has filed its opinion after months of speculation in the legal community about the reach of the collateral source rule. In Howell v. Hamilton Meats (filed August 18, 2010), the court held an injured plaintiff whose medical expenses are paid through private insurance may recover as economic damages no more that the amounts paid by the plaintiff or his insured for the medical services. It concluded the negotiated rate differential (the difference between the medical provider's customary charges and the charge it agrees to receive as payment-in-full from plaintiff's insurance) is not a collateral benefit recoverable by plaintiff under the collateral source rule.

While, the 6-1 majority opinion written by Associate Justice Werdegar goes into 30-page detail to explain its ruling, the critical turning point is found in the following language: "[W]e do not alter the collateral source rule as articulated in Helfend [Helfend v. Southern California Rapid Transit (1970) 2 Cal.3d 1] and the Restatement. Rather we conclude that because the plaintiff does not incur liability in the amount of the negotiated rate differential, which also is not paid to or on behalf of the plaintiff to cover expenses of the plaintiff's injuries, it simply does not come within the rule." (Slip opinion at pp. 26-27.)

Presiding Justice Cantil-Sakauye voted with the six justice majority. Just one year ago, she authored the opinion of the Court of Appeal, Third Appellate District in King v. Willmett (one of three opinions granted review along with Howell) and wrote, "We see no basis in the record from which we could conclude plaintiff did not incur $169, 499.94 [of which $93, 213.62 was the negotiated rate differential not paid by medical insurance] in past medical expense." (Slip opinion at p. 25.) In holding exactly the opposite as the holding in the state high court ruling in Howell, the King court found persuasive the Helfend view that "a person who has invested years of insurance premiums to assure his medical care should receive the benefits of his thrift. The tortfeasor should not garner the benefits of the victim's providence." (Id. at p.26)

Continue reading "Collateral source rule in California: injured plaintiffs barred recovery of value of medical services in excess of bargained rate paid by insurance " »

Recently, the issue of awardability of claimed medical damages against tortfeasors has been a hot appellate topic. The California Supreme Court currently has under submission the case of Howell v. Hamilton Meats concerning medical expenses incurred yet paid to the provider in a lesser sum due to downwardly negotiated collateral medical insurance benefits. (See March 10 blog.) When it comes to future medical expenses, the question arises as to whether the expense is too speculative. (See March 31 blog and Behr v. Redmond.) These cases, of course, deal with human medical expenses. Today I will write about animal medical expense (in particular those incurred regarding a wrongfully injured pet).

In Kimes v. Grosser (filed May 31, 2011) 2011 DJDAR 7866), plaintiff's cat Pumkin was shot with a pellet gun allegedly fired by one of the defendants, who were neighbors. Emergency surgery at a cost of $6,000 saved Pumkin's life and an additional $30,000 was spent caring for Pumkin's partially paralyzed condition. Plaintiff sued for these medical costs and further claimed punitive damages. Defendants succeeded on a motion in limine in the trial court to exclude any evidence of plaintiff's expenses because Pumkin was "an adopted stray of very low economic value." With the granting of this motion, plaintiff could not proceed resulting in judgment of dismissal.

The Court of Appeal, First Appellate District, Division One, disagreed with the trial court, reversing the judgment and holding the pet owner can recover the costs of care of the pet attributable to the injury if the costs are found to be reasonable and necessary, and punitive damages if proven. While pets are considered property of their owners, the jury instruction on injury to personal property (CACI NO. 3903J) does not apply here as was argued by defendants. That capsulation of law suggests that an owner can only recover the lesser of the diminution in market value of the property and the reasonable costs of repair. Nor is this a case of the plaintiff trying to recover due to the sentimental or emotional value of the pet (in contrast to McMahon v. Craig (2009) 176 Cal.App.4th 1502). Under California Civil Code section 3355, one is entitled to value property based upon its unique economic value.

Continue reading "Tort Claim Is Actionable As Plaintiff May Recover Damages for Reasonable Treatment of Pet Even If Animal Has No Market Value" »

After receiving a $6.75 million Riverside County Superior Court jury verdict against him for tortiously transmitting genital herpes to his ex-girlfriend, Aussie hair care products founder Thomas Redmond appealed. In Behr v. Redmond (filed March 2, 2011, certified for publication on March 14, 2011) 2011 DJDAR 3795, the California Court of Appeal, Fourth Appellate District, Division Two, reduced the award of $2.5 million in future medical expenses to $72,000, otherwise affirming the judgment that provided $3,600 for past medical expenses, $500,000 for past general damages, $1million for future general damages and 2.75 million for punitive damages (reduced total of $4,325,600).

Plaintiff and defendant began having sexual relations in October 2003. Defendant knew he had genital herpes since 1975, but did not initially inform plaintiff. After they had sex on 10 occasions, he decided in February 2004 to tell her about this long-time medical condition, but misinformed her that it was safe for them to have sex so long as he was not experiencing an outbreak, so they continued their sexual activity. The following month she started having outbreaks and was eventually diagnosed with genital herpes in February 2005. Plaintiff sued and prevailed at trial as indicated above. Defendant's contentions on appeal included the evidence was insufficient that plaintiff contracted herpes prior to defendant's disclosure, and the compensatory and punitive damages were excessive.

The appellate court was satisfied that the evidence was sufficient to establish causation because the jury could have reasonably concluded that defendant's eventual disclosure was incomplete due to his assurances to plaintiff that she could safely continue to engage in sexual activity with him; this could reasonably constitute negligence and fraudulent concealment even if it was unclear as to when she contracted herpes. The court was not satisfied however that plaintiff produced sufficient evidence to support the award of future medical loss in the sum of $2.5 million. The only medical cost projected by the evidence was that of the medication Valtrex which costs $200 for a one-month supply. Based on the 56-year-old plaintiff's life-expectancy, the amount of expense over her lifetime would be no more than $72,000, far short of the $2.5 million award. The verdict was reduced accordingly. But the court was unpersuaded that the punitive award of 2.75 million required either reduction or remand. Defendant's argument was that a jury's mistake in awarding an excessive compensatory award necessarily taints the amount of the punitive award, citing Krusi v. Bearn, Stearns & Co. (1983) 144 Cal.App.3d 664 and Auerbach v. Great Western Bank (1999) 74 Cal.App.4th 1172. Misplaced reliance, responded the court: Krusi merely holds that when a trial court is instructed to reconsider compensatory damages, it may wish to reduce the punitive award as well; Auerbach involved a grossly disproportionate award of punitive damages relative to compensatory damages in a ratio of 385 to 1. After reduction here, the ratio is only 1.75 to 1, so this punitive award, in the court's view, is not "suspect."

Continue reading "Plaintiff's Future Medical Damage Award For Tortious Transmission Of Herpes Must Be Based On Substantial Evidence, But Punitive Damages Award Was Not Excessive " »

In my last posting, I discussed the recently published appellate court opinion in Cabrera. Part of the rationale of that opinion was that the court was following "current" California published case law. My question is how should judges and attorneys handle legal authority that may appear shaky based upon currently pending cases before higher authority? In the present situation, three previously published appellate opinions reaching the opposite result of Cabrera are under review by the California Supreme Court. For attorneys, it all depends which side you are on; you will want to shed the best possible light on the arguments that favor your client. Judges have a tougher call.

On the specific issue of jury awards for reasonable medical services rendered yet not actually paid due to a plaintiff's private insurance company's negotiated rate with the provider, defense counsel should not expect Cabrera to remain for very long as a citable opinion. I suspect it will have the shelf life of the "catch of the day." It will likely be promptly depublished by the Supreme Court as part of a review grant-and-hold order awaiting the Supreme Court's opinion in Howell. So until the Supreme Court rules, what will lower courts do? Based on everything I have read, the foundational case of Cabrera's "current law" rationale (Hanif) teeters on shaky ground. I draw a strong inference from the Supreme Court saying in Parnell that it had no opinion as to whether Hanif applies outside of the Medi-Cal context that it will find it does not. The Court need only summon the Supreme Court's authoritative language found in Helfend to say that Hanif is different from the collateral source principles that apply to private insurance, recognizing the important public policy of rewarding ones investment in medical insurance. The mere fact that Helfend is 41 years old does not make it bad law--it actually reads as a prescient statement of what has happened in medical cost financing during these many years since. I also suspect that a good predictor is Chief Justice Cantil-Sakauye's previous authorship of King the third case in the Howell trilogy, in which she concludes that Hanif (a case that came out of that same district) and two other cases that follow it, "do not provide governing authority for the question directly presented in this case."

Continue reading "The Risky Business of Judges and Counsel, Both Trial and Appellate, Predicting How the Supreme Court Will Decide An Undecided Issue, Such as Award for Reasonable Value of Negotiated Medical Services " »

During 2010, the California Supreme Court granted review in the Court of Appeal cases of Howell v. Hamilton Meats (4th District), Yanez v. SOMA Environmental Engineering (1st District) and King v. Willmett (3rd District). In a nutshell, those three opinions can be summarized as saying that the award of an injured plaintiff's medical provider's full billing of reasonable and necessary charges was compelled because plaintiff's investment in medical insurance premiums is recompensed as a type of objectively verifiable economic damage under California Civil Code section 1431.2 (b) (1)--actual expense is only part of entitled damages; the fact that plaintiff 's insurance negotiated group rate paid to the provider is less does not provide a windfall to plaintiff whose prudence in procuring such insurance should not benefit the tortfeasor.

The 2nd District, Division 8, had the same issue before it in Cabrera v. E. Rojas Properties, Inc. (filed February 8, 2011; certified for publication on February 24, 2011) 2011 DJDAR 2961. There, after the jury had awarded plaintiff damages that included all of her reasonable and necessary medical billings (less 10% due to comparative fault regarding her fall down a staircase on property owned by defendant), the trial court granted defendants post-verdict motion to reduce the past medical damages to include only what was actually paid by her insurer.

The Cabrera court reasoned that under its view of current California law, as explained in Hanif v. Housing Authority (1988) 200 Cal.App.3d 635 and followed by some other pre-2007 Court of Appeal opinions, an injured plaintiff is limited to medical expenses actually paid; to the extent the reasonable amount of those services is greater, there is no entitlement. The court recognized that Hanif concerned medical care paid by Medi-Cal, not private insurance, but other cases relying on Hanif, in the court's view, have "extended" Hanif to private insurers. The court dutifully recites from the venerable, seminal case of Helfend v. Southern Cal. Rapid Transit Dist. (1970) 2 Cal.3d 1, cited frequently in the "Howell trilogy," which endorses the policy of encouraging people to get insurance; the collateral source rule protects that objective in valuing ones investment in insurance and not allowing the tortfeasor to benefit from the victim's providence. Interestingly, when evaluating the plaintiff's argument that the Hanif reduction view should be rejected based on this articulated policy and because it "rejects decades of Supreme Court authority", the Cabrera court responds there is "no current Supreme Court authority that extends the collateral source rule to include the benefit of a negotiated contract between a medical provider and a medical insurer."

Continue reading "Appellate Panel Finds Collateral Source Rule Does Not Bar Reduction of Jury-Awarded Past Medical Expenses That Were Reasonable and Necessary but Negotiated Down by Plaintiff's Private Insurance " »