Kroger Co. v. Walters

• Decision Date: 29 November 2012
• Docket Number: No. A12A1637.,A12A1637.
• Parties: The KROGER CO. v. WALTERS et al.
• Court: Georgia Court of Appeals

319 Ga.App. 52

735 S.E.2d 99

The KROGER CO.

v.WALTERS et al.

No. A12A1637.

Court of Appeals of Georgia.

Nov. 29, 2012.

Douglas A. Wilde, Tyrone, for Appellant.

Lloyd Noland Bell, Bruce Berger, Darren Summerville, Atlanta, for Appellee.

BRANCH, Judge.

Craig and Lisa Walters brought this slip-and-fall action against The Kroger Company. During discovery, the trial court struck Kroger's answer on the ground that Kroger had spoliated evidence and acted in bad faith, thereby precluding Kroger from introducing evidence at trial to contest its negligence. The case went to trial on causation, damages, and attorney fees. Walters, age 48 at the time of the fall, was able to show the fall caused a severe spine injury that required surgery and resulted in a lifelong disability. A jury awarded $1,689,456 in damages and $675,782.40 in attorney fees. Kroger appeals and claims six errors, primarily related to the issues of spoliation, litigation expenses, and damages. We affirm the ruling on spoliation but reverse the judgment because the trial court erroneously excluded material evidence at trial.

1. Kroger first challenges the court's pretrial decision to strike Kroger's answer on the ground of spoliation. “[S]poliation refers to the destruction or failure to preserve evidence that is necessary to contemplated or pending litigation.” (Citation and punctuation omitted.) Silman v. Assocs. Bellemeade, 286 Ga. 27, 28, 685 S.E.2d 277 (2009). “Where a party has destroyed or significantly altered evidence that is material to the litigation, the trial court has wide discretion to fashion sanctions on a case-by-case basis.” (Citation omitted.) AMLI Residential Properties v. Ga. Power Co., 293 Ga.App. 358, 361(1), 667 S.E.2d 150 (2008). A trial court's decision imposing sanctions for spoliation is reviewed for abuse of discretion. Wal–Mart Stores v. Lee, 290 Ga.App. 541, 546(1), 659 S.E.2d 905 (2008).

The court's decision on spoliation was based on the discovery evidence. Construed in favor of the trial court's decision, that evidence shows that on May 25, 2008, Walters slipped and fell on a piece of banana in the meat department of a Kroger store and landed on his left hip and left elbow. Initially, Walters did not experience pain or other symptoms. Peyton Kelley, the store co-manager, came to the scene, saw the alleged cause of the fall, which he described as “mushy” and smelling like banana, and spoke with Walters and a customer who witnessed the fall. Kelley asked Walters if he was okay, and Walters replied that he appeared to be fine. But Kelley also remembered that Walters said he was a little sore, and Kelley noticed that Walters was limping. Kelley told Walters to let him know if he had any problems so that he could take care of it. Walters gave Kelley his name and resumed shopping; he did not threaten a lawsuit. But when he got in his car to go home, Walters began to experience unusual symptoms, including tingling in his toes, numbness in his legs, and, eventually, loss of balance, which grew worse over time.

Following Kroger's stated procedure to investigate every such incident, Kelley began to investigate Walters' fall that same day. He spoke to store employees, including the employee nearest to the fall. And he downloaded from a company website a six-page “Customer Incident Report & Investigation Check List,” which he completed, partially that day and partially thereafter, based on his notes from the day of the incident, including a diagram of where Walters fell. That diagram is marked as having been drawn on May 25, and every page of the customer incident report, including the diagram, states that it was made “in anticipation of litigation under the direction of legal counsel.” The report has instructions to mail it to “Sedgwick CMS, Kroger Liability Unit.”

Kelley admitted, however, that in several regards, he did not follow store policy regarding his investigation. Kelley reviewed video from the security cameras located in the vicinity of the fall, including camera 17, the camera closest to that area. The cameras' hard drives retain their video for 17 days but are then erased and reused; to retain a video for a longer time, one must transfer the file to a CD or DVD. Store policy dictated that if the video covered the area of the fall, it should be retained. After viewing the video captured at the time of the fall, Kelley decided not to save any video despite the company policy. He testified that none of the cameras captured the incident. He also testified, however, that he could not recall reviewing the video images that day, that he did not know why he did not make a copy, and that he could not be sure the system was actually working at the time. Kelley admitted that, in addition to the fall itself, the videos might have shown when the store aisles were inspected, how and when banana came to be on the floor in the meat department, and whether any store employees were in the vicinity of the fall.¹ Kelley also testified that if he had looked at the video, he should have recorded his findings in the incident report, yet the report does not reference any video. Finally, Kelley had a still camera at the store, and he testified that he should have taken photographs of the scene but did not do so.

Walters spoke to Kelley again at the store within two weeks of the fall and told him that he had an appointment with a doctor. Walters also saw Kelley from time to time thereafter when he went shopping. Walters first saw an orthopedist on July 3, 2008. On July 9, 2008, more than 17 days after the fall, Walters again spoke to Kelley and reported having problems with his back and legs beginning a month after the fall; he also stated that he needed help with his medical bills. During that conversation, Kelley obtained a telephone number and address for Walters and said he was going to submit the claim to Sedgwick. In August, Kelley faxed the Customer Incident Report to the company risk management office and to Sedgwick; the report has a handwritten “Claim # ” filed in.

Walter and his wife filed suit on March 6, 2009, less than a year after the fall. At his deposition on November 30, 2009, Kelley testified that camera 17—the camera closest to the scene of the fall—had not been moved or re-aimed since the day of the fall. Subsequently, Kroger produced exemplar video (taken from each camera on January 7, 2010), showing each camera's field of view, and camera 17 did not point directly at the place where Walters fell. On August 3, 2010, Walters' counsel took the deposition of store manager Harry Turner in his office at the store. Turner testified that none of the indoor cameras had been re-aimed, including camera 17, since he began managing the store in 2004 and that the cameras could not be moved electronically; rather, a person would have to climb a ladder to adjust them. But Walters' counsel then asked to view a live feed from camera 17, and Kroger's attorney objected. Following a discussion among the lawyers, the live feed was shown, and it was discovered that the camera was not pointed in the same direction as the exemplar and that, instead, the camera pointed directly at the location of Walters's fall. Thereafter, Turner testified that he could not say which way the camera was pointed at the time of the fall.

Walters filed a motion for sanctions, and the court held a hearing on November 12, 2010. On December 14, 2010, the court entered an order finding that Kroger had destroyed the video from the date and time of the incident by not preserving it; that the video might have established either actual or constructive knowledge by Kroger of a foreign substance on the floor; that the Customer Incident report states that it was made in anticipation of litigation; that the exemplar video showed the general area but not the exact location of the fall; that the subsequent deposition revealed that the camera was “centered on the exact location of Walters' fall and not the location shown in the prior images produced by Kroger and could have clearly shown the exact conditions at the time of Walters' fall and whether Kroger employees knew or should have known of the dangerous condition in that area.” The court concluded that Kroger had spoliated the video evidence, which could have been maintained at minimal expense; that the spoliation prejudiced Walters; and that Kroger “acted in bad faith in failing to preserve the evidence and manipulating evidence to excuse its actions.” At the same time, and based on its ruling on spoliation, the trial court denied Kroger's motion for summary judgment on the merits.²

(a) The evidence outlined above shows that the court's factual findings are supported by some evidence in the record.

(b) Kroger argues, however, that the court's order cannot be sustained because the facts fail to show it had notice at the time the video was erased that Walters was contemplating litigation, as is required in spoliation cases. See Baxley v. Hakiel Indus., 282 Ga. 312, 313, 647 S.E.2d 29 (2007); Kitchens v. Brusman, 303 Ga.App. 703, 707(1)(a), 694 S.E.2d 667 (2010). As a part of its argument, Kroger asserts that Kelley had no contact with Walters during the 17–day period in which he could have saved the video in question. But Walters deposed that he returned to the store “a week and a half, two weeks” after his fall and told Kelley about his upcoming doctor's appointment. Further, beginning on the day of the fall, Kelley began to prepare a report which states that it was made in anticipation of litigation. And some evidence supports the trial court's conclusion that during discovery Kroger submitted a false exemplar from camera 17, from which an inference could arise that Kroger knew the original video should not have been deleted.

The facts taken as a whole are sufficient to support the trial court's findings. In Baxley, a dram-shop liability case, the Supreme Court reversed the trial court and this Court...