Hospital Authority of Fulton County v. Litterilla, s. A90A1553

• Decision Date: 08 March 1991
• Docket Number: Nos. A90A1553,A90A1814,s. A90A1553
• Citation: 404 S.E.2d 796,199 Ga.App. 345
• Parties: HOSPITAL AUTHORITY OF FULTON COUNTY et al. v. LITTERILLA. HOSPITAL AUTHORITY OF FULTON COUNTY et al. v. HYDE et al.
• Court: Georgia Court of Appeals

Page 796

404 S.E.2d 796

199 Ga.App. 345

HOSPITAL AUTHORITY OF FULTON COUNTY et al. v. LITTERILLA.

HOSPITAL AUTHORITY OF FULTON COUNTY et al. v. HYDE et al.

Nos. A90A1553, A90A1814.

Court of Appeals of Georgia.

March 8, 1991.

Rehearing Denied March 28, 1991.

Certiorari Granted July 5, 1991.

Powell, Goldstein, Frazer & Murphy, James D. Meadows, Randall L. Hughes, Adrienne E. Marting, Love & Willingham, Daryll Love, Hezekiah Sistrunk, Sullivan, Hall, Booth & Smith, Rush S. Smith, Jr., Atlanta, for appellants.

Davis, Gregory & Christy, Hardy Gregory, Jr., Vienna, William Q. Bird, Atlanta, for appellee Litterilla.

England, Weaver & Kytle, J. Melvin England, James W. Kytle, Atlanta, for appellees Hyde et al.

SOGNIER, Chief Judge.

This consolidated appeal raises the question whether the Hospital Authority of Fulton County d/b/a Northside Hospital (the "Authority") is entitled to the defense of governmental immunity in medical malpractice actions, and if so, whether that immunity is waived to the extent of a liability trust fund. In Case No. A90A1553, Angela Litterilla, by next friend Mary Litterilla, brought suit against the Authority and others in Fulton County State Court, asserting a claim arising from the allegedly negligent acts of the defendants during her birth. Carl and Ann Hyde brought a claim in Fulton Superior Court against the Authority and a physician in Case No. A90A1814 for alleged negligence in the performance of a surgical procedure on Mr. Hyde. Both courts denied the Authority's motions for summary judgment on the immunity issue. We authorized interlocutory appeals from both orders and have consolidated the cases for review.

1. The extent to which hospital authorities are entitled to the defense of governmental immunity is an unsettled issue because of several appellate rulings on various aspects of the immunity issue. Accordingly, we must review the applicable legal principles. The Georgia Constitution authorizes counties to provide, inter alia, "[p]ublic health facilities and services, including hospitals." Ga. Const. of 1983, Art. IX, Sec. II, Par. III(a)(3). The procedure for the exercise of this power is set forth in the Hospital Authorities Law, Ga.L.1964, p. 499 (now codified at OCGA § 31-7-71 et seq.), which has the express legislative purpose of "provid[ing] a mechanism for the operation and maintenance of needed health care facilities in ... counties." OCGA § 31-7-76(a). Counties are authorized to establish hospital authorities which are "deemed to exercise public and essential governmental functions," OCGA § 31-7-75, and which may operate only nonprofit facilities funded in part by tax revenues. OCGA §§ 31-7-77; 31-7-84. The Authority was established and continues to operate under this statutory scheme.

In Hall v. Hospital Auth. of Floyd County, 93 Ga.App. 319, 320, 91 S.E.2d 530 (1956), the court concluded that because the preservation of public health was a duty of the State as a sovereign power, the delegation of that obligation to counties meant that activities of counties in discharging this duty constituted " 'the exercise of a purely governmental function.' " When this delegation of duty is made, the court held, "the corporation maintaining and operating a hospital under such delegated authority, not for profit, is in the exercise of a governmental function and not subject to suit in a tort action," id. at 321, 91 S.E.2d 530, and thus hospital authorities were entitled to the defense of sovereign immunity. This ruling was soon superseded. In Knowles v. Housing Auth. of Columbus, 212 Ga. 729, 95 S.E.2d 659 (1956), the Supreme Court held that a provision in an enabling statute authorizing an entity "to sue and be sued" caused a waiver of the judicially created doctrine of sovereign immunity. Shortly thereafter, this court acknowledged that identical language in the predecessor to the Hospital Authorities Law (see Ga.Code Ann. Ch. 99-15) compelled the conclusion that the immunity of hospital authorities likewise was waived. Hospital Auth. of Hall County v. Shubert, 96 Ga.App. 222, 224-225(1), 99 S.E.2d 708 (1957). This conclusion was reaffirmed after enactment of the current version of the Hospital Authorities Law. Medical Center Hospital Auth. v. Andrews, 250 Ga. 424(1), 297 S.E.2d 28 (1982).

During this period of judicial evolution of the doctrine of sovereign immunity, the doctrine attained constitutional status. Ga. Const. of 1976, Art. VI, Sec. V, Par. I (former Ga.Code Ann. § 2-3401) (superseded by Ga. Const. of 1983, Art. I, Sec. II, Par. IX). In addition, one year ago the Supreme Court reversed its interpretation of the legislative "sue and be sued" language, and ruled "that in any instances in which an entity is given the power 'to sue and be sued' that language means only that the entity has the status and capacity to enter our courts, and does not signify a waiver of sovereign immunity against suit. Any cases that hold to the contrary are hereby overruled." (Emphasis supplied.) Self v. City of Atlanta, 259 Ga. 78, 80(1), 377 S.E.2d 674 (1989). This unequivocal ruling means that Knowles, Shubert, and Andrews are no longer controlling, and since the "sovereign immunity rule [as it existed] prior to 1973 has now been made a part of our Constitution," Miree v. United States, 242 Ga. 126, 133(1), 249 S.E.2d 573 (1978), the application of the immunity doctrine to hospital authorities must be determined by reference to the constitutional provision.

Although the 1983 Georgia Constitution extends sovereign immunity to the State and its "departments and agencies" (Art. I, Sec. II, Par. IX), that language has been held to apply to counties and their instrumentalities as well. Toombs County v. O'Neal, 254 Ga. 390, 330 S.E.2d 95 (1985); see Ward v. Bulloch County, 258 Ga. 92, 365 S.E.2d 440 (1988). Thus, if the Authority is an agency or instrumentality of Fulton County and is operated primarily for the benefit of the public rather than for the generation of revenue for the county, it is entitled to assert the defense of governmental immunity available to the county (to the extent that defense has not been waived). See Johnson v. City of Atlanta, 171 Ga.App. 296, 297(1), 319 S.E.2d 506 (1984).

In addition to this court's analysis of a hospital authority's function and status in Hall, supra, the Supreme Court has considered, in contexts other than the immunity issue, the nature of hospital authorities. In Cox Enterprises v. Carroll etc. Hosp. Auth., 247 Ga. 39, 273 S.E.2d 841 (1981), the court determined that a hospital authority organized under the Hospital Authorities Law could not bring a libel action against a newspaper because the authority was a governmental entity and thus subject to the prohibition on libel actions by governments. "Factors tending to establish the Authority's governmental nature include that it is a creature of statute; that it is defined as a 'public body corporate and politic' ...; that its Board is appointed by the governing body of the relevant political subdivision or subdivisions; that it is tax exempt; that it is deemed to exercise public and essential governmental functions; that it may exercise the power of eminent domain; that i[t] receives tax revenues; and that the governing bodies of the relevant political subdivisions have a role in determining the disposition of its property upon dissolution." (Emphasis omitted.) Id. at 44, 273 S.E.2d 841. See Fulton-DeKalb Hosp. Auth. v. Gaither, 241 Ga. 572, 247 S.E.2d 89 (1978) (hospital authorities are state and county instrumentalities and were not subject to the former definition of "employer" in the Workers' Compensation Act); accord, James v. Richmond County Health Dept., 168 Ga.App. 416, 309 S.E.2d 411 (1983) (sovereign immunity of counties extends to county health departments because they are engaged in governmental functions and act as agents of State).

Given this judicial history, and considering the enabling language under which the Authority was created and operates, we conclude that hospital authorities established pursuant to the Hospital Authorities Law are entitled to the defense of governmental immunity except to the extent there has been a waiver under the constitutional provision.

We note that Self, supra, was decided after the instant actions were filed. As a general rule, court rulings that substantially alter existing law apply retroactively, but our courts have recognized that rulings in civil cases may be applied prospectively. General Motors Corp. v. Rasmussen, 255 Ga. 544, 545-546(2), 340 S.E.2d 586 (1986). In Flewellen v. Atlanta Cas. Co., 250 Ga. 709, 712-715(3), 300 S.E.2d 673 (1983), the Supreme Court determined that in analyzing the question of retroactivity the three-pronged test set forth in Chevron Oil Co. v. Huson, 404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971) should be applied. Accordingly, we must (1) ascertain whether Self established a new principle of law either by overruling past precedent or by deciding an issue of first impression whose result was not clearly foreshadowed; (2) balance the merits by looking to the prior history of the rule in question, its purpose and effect, and whether retroactive application would further or retard its operation; and (3) weigh the inequity imposed by retroactive application to ascertain whether the decision could produce substantial inequitable results if applied retroactively. James B. Beam, etc., v. State of Ga., 259 Ga. 363, 364(2), 382 S.E.2d 95 (1989).

Applying the first prong, as we have discussed in this Division, Self did overrule existing precedent. However, as the Supreme Court acknowledged in Self, the issue of waiver of sovereign immunity by "sue and be sued" statutory language has been the subject of numerous conflicting decisions in recent years. Consequently, we cannot say that the first prong of the Chevron test compels a prospective application of the rule established in Self. As to the...