Estate of Gibson v. Magnolia Healthcare, Inc.

• Decision Date: 19 July 2012
• Docket Number: No. 2010–CA–00741–SCT.,2010–CA–00741–SCT.
• Citation: Estate of Gibson v. Magnolia Healthcare, Inc., 91 So.3d 616 (Miss. 2012)
• Parties: The ESTATE OF Henry C. GIBSON, by and through Don R. GIBSON, Administrator for the Use and Benefit of the Estate of Henry C. Gibson, and on behalf of and for the Use and Benefit of the Wrongful Death Beneficiaries of Henry C. Gibson v. MAGNOLIA HEALTHCARE, INC. and Foundation Health Services, Inc.
• Court: Mississippi Supreme Court

91 So.3d 616

The ESTATE OF Henry C. GIBSON, by and through Don R. GIBSON, Administrator for the Use and Benefit of the Estate of Henry C. Gibson, and on behalf of and for the Use and Benefit of the Wrongful Death Beneficiaries of Henry C. Gibson

v.MAGNOLIA HEALTHCARE, INC. and Foundation Health Services, Inc.

No. 2010–CA–00741–SCT.

Supreme Court of Mississippi.

April 12, 2012.

Rehearing Denied July 19, 2012.

Mary J. Perry, Anthony Lance Reins, attorneys for appellants.

Justin M. Starling, Michael A. Heilman, Christopher T. Graham, Jackson, attorneys for appellees.

Before CARLSON, P.J., LAMAR and CHANDLER, JJ.

LAMAR, Justice, for the Court:

¶ 1. Henry C. Gibson was a resident of Arnold Avenue Nursing Home (“AA”) in Greenville, Mississippi, from June 2001 until December 2002. After being hospitalized in December 2002, Gibson was moved to another nursing home and died on January 26, 2003. Gibson's estate filed a wrongful-death action on August 24, 2004, seeking compensatory and punitive damages. The plaintiffs averred that Magnolia Healthcare, Inc., the owner of AA, and Foundation Health Services, Inc., an entity that had entered into a management and financial-services agreement with Magnolia, were negligent in causing various injuries, some of which contributed to Gibson's death. The jury awarded $1.5 million in compensatory damages, which the trial court reduced to $500,000 for noneconomic damages and $75,000 for permanent disfigurement. The trial court refused to allow the jury to consider punitive damages.

¶ 2. The plaintiffs appealed, asserting two issues: (1) whether the trial court erred in refusing to allow the jury to consider punitive damages; and (2) whether the statutory cap for noneconomic damages is constitutional. We find no error in the trial court refusing to allow the jury to consider punitive damages. We find the plaintiffs failed to raise the constitutionality of the statutory cap before the trial court; thus that issue is procedurally barred.

¶ 3. AA and Foundation cross-appealed on various issues that are summarized as follows: (1) whether the trial court erred in denying Foundation's motion for judgment notwithstanding the verdict (JNOV), because it was not a proper party; (2) whether the trial court erred in denying the defendants' motion for JNOV on the issues of breach and causation; and (3) whether the trial court erred in denying the defendants' motion for mistrial based on improper witness testimony and counsel's inappropriate comments before the jury. We find that Foundation was an improper party and that the trial court should have granted its motion for JNOV. However, we find no error in any of the remaining issues raised by the Defendants.

Facts

¶ 4. Henry Gibson was seventy-one years old when his family decided to admit him to AA for care and rehabilitation following a stroke that caused paralysis to the right side of his body. As a result of the stroke and subsequent seizures, he was bedbound and incontinent throughout his residency at AA. At the time Gibson was admitted, he had difficulty communicating verbally, and he suffered from numerous medical conditions, including alcoholism, diabetes, high blood pressure, and heart problems. He was approximately 5'2? and initially weighed 181, although malnourished at the time he entered AA. Shortly after entering the nursing home, Gibson was placed on a PEG (percutaneous endoscopic gastrostomy), or feeding tube, due to difficulty swallowing. Over the course of his stay, Gibson lost approximately forty pounds.

¶ 5. On December 31, 2002, Gibson was hospitalized after experiencing difficulty breathing. During this hospitalization, it was discovered that Gibson had a collection of fluid around his left lung (hemothorax) and a fractured right arm. Dr. Hugh Gamble, a thoracic surgeon, drew out approximately 1,500 ccs of slightly bloody pleural fluid, and later, an additional 500 ccs of primarily blood. Dr. Gamble identifiedthe fluid and blood accumulation and broken arm as secondary to a fall.

¶ 6. Following the discovery of the hemothorax and broken arm, Gibson's family transferred him to another nursing home. Gibson subsequently passed away on January 26, 2003. His death certificate lists sepsis as the cause of death, with contributing causes of fracture of the right humerus and hematoma in the lung.

¶ 7. At trial, the plaintiffs argued that AA negligently allowed Gibson to fall out of bed by failing to ensure his bed rails were kept upright. The plaintiffs argued this alleged negligence caused the hemothorax and broken arm, and that both injuries contributed to Gibson's death. This theory was based on AA's documentation of two previous falls and testimony by caregivers that the rails occasionally were left down. The plaintiffs also produced evidence that AA was negligent by: (1) allowing two bed sores to form by failing regularly to turn Gibson; (2) failure to prevent the bed sores from progressing and becoming infected by failure regularly to turn and use proper supplies; (3) failure to improve his malnourishment/dehydration and actually causing it to worsen by failing to ensure Gibson received the ordered PEG tube feedings; and (4) failing to provide range-of-motion exercises to prevent contractures. The plaintiffs also produced evidence that AA was short-staffed and that its employees who cared for Gibson failed properly to document his care and medical problems, all of which contributed to the above-noted injuries.

¶ 8. Conversely, the defendants argued that Gibson's poor health preceded his admission to AA and that his injuries were a natural consequence of his poor health and could not be prevented. The defendants also argued that the plaintiffs had no documentation or eyewitness testimony to prove that a fall caused Gibson's hemothorax and broken arm; thus, the plaintiffs' case was based on pure speculation. The defendants' experts opined that Gibson's hemothorax was the product of congestive heart failure and that Dr. Gamble had nicked a vein or artery in drawing out the fluid (hence the blood-tinged fluid). The defendants also set forth the theory that the broken arm was an unexplained injury that likely happened on the way to or at the hospital. The defendants' experts also testified that Gibson must have received the right amount of nutrition and liquid through his tube feedings, or the pressure sores would not have healed. And caregivers testified they regularly turned Gibson, always had adequate supplies and staff, and found no documentation of a fall that produced any injuries. Last, the defendants produced evidence that physical and occupational therapy failed to improve or prevent worsening of Gibson's contractures, so AA caregivers discontinued such therapy upon physician orders; however, the defendants maintained that AA did provide restorative care (range-of-motion exercises).

¶ 9. After hearing all the evidence, the jury rendered a verdict in favor of Gibson's estate. The jury awarded the plaintiffs $1.5 million in compensatory damages, $75,000 of which it allocated for permanent disfigurement. So the trial court reduced the damages award to $575,000 due to the cap on noneconomic damages under Mississippi Code Section 11–1–60.¹

¶ 10. The plaintiffs also moved to allow the jury to consider punitive damages. The plaintiffs did not introduce any additional evidence, but relied on the evidence presented during the compensatory damages phase. ² The trial court denied the plaintiffs' motion for the jury to consider punitive damages.³ The court ruled that, based on the evidence, it could not find AA's conduct was “sufficiently egregious or offensive” to warrant a finding of “gross negligence” or “reckless disregard” or to submit the question of punitive damages to the jury.

Issues on Cross–Appeal⁴

I. Whether the trial court erred in denying the defendants' motions for directed verdict and judgment notwithstanding the verdict.

¶ 11. Motions for directed verdict and judgment notwithstanding the verdict challenge the legal sufficiency of the evidence. ⁵ This Court applies the same standard of review for both motions:

This Court will consider the evidence in the light most favorable to the appellee, giving that party the benefit of all favorable inference[s] that may be reasonably drawn from the evidence. If the facts so considered point so overwhelmingly in favor of the appellant that reasonable men could not have arrived at a contrary verdict, we are required to reverse and render. On the other hand if there is substantial evidence in support of the verdict, that is, evidence of such quality and weight that reasonable and fair minded jurors in the exercise of impartial judgment might have reached different conclusions, affirmance is required.⁶

A. Foundation's motions for directed verdict and judgment notwithstanding the verdict

¶ 12. Foundation argues that no evidence exists that it had an ownership interest in the facility or that it provided medical care to Gibson. Foundation argues that no liability can be imposed for providing managerial, administrative, or financial services to AA. Foundation further argues that its duties were akin to that of an administrator or licensee, which under Mississippi law does not impose on it a duty of care to nursing-home residents. ⁷

¶ 13. At trial, all parties stipulated into evidence two contracts between Foundation and Magnolia: (1) a “Management Agreement” dated January 1, 2000; and (2) a “Financial Services Agreement” dated January 1, 2002. AA's applications for licensure, which list Foundation as the managing entity, also were stipulated into evidence. The two agreements and applications were the only evidence the plaintiffs relied upon for Foundation's liability.

¶ 14. To justify liability, the plaintiffs point to various provisions in the management agreement specifying that Foundation was to act “solely as agent and acting on behalf of Magnolia.” Under the...