Nance by Nance v. Westside Hosp.

• Decision Date: 16 February 1988
• Citation: 750 S.W.2d 740
• Parties: Paul Cecil NANCE, by his Guardian, Patsy NANCE, and Patsy Nance, individually, Plaintiffs-Appellees, and Stauffer Chemical Company, Intervening Plaintiff, v. WESTSIDE HOSPITAL, General Care Corporation, d/b/a Westside Hospital, Middle Tennessee Anesthesiologists, P.C., and Dr. Charles Cannon, Jr., Defendants- Appellants.
• Court: Tennessee Supreme Court

Page 740

750 S.W.2d 740

Paul Cecil NANCE, by his Guardian, Patsy NANCE, and Patsy Nance, individually, Plaintiffs-Appellees and Stauffer Chemical Company, Intervening Plaintiff, v. WESTSIDE HOSPITAL, General Care Corporation, d/b/a Westside Hospital, Middle Tennessee Anesthesiologists P.C., and Dr. Charles Cannon, Jr. Defendants- Appellants.

Supreme Court of Tennessee at Nashville.

Feb. 16, 1988.

Rehearing Denied April 5, 1988.

William S. Fleming, Courtney, Fleming & Holloway, Columbia, Thomas H. Peebles, III, Trabue, Sturdivant & DeWitt, Andree Kahn Blumstein, Trabue, Sturdivant & DeWitt, Nashville, for Paul Cecil Nance and Patsy Nance.

Kent E. Krause, Brewer, Krause & Brooks, Nashville, for Stauffer chemical co.

John S. Bryant, Robert E. Cooper, Jr., Bass, Berry & Sims, Nashville, for General Care Corp.

Byron R. Trauger, Leigh Hunt Greenhaw, Doramus, Gideon & Trauger, Nashville, for Middle Tennessee Anesthesiologists.

W.J. Michael Cody, Atty. Gen. and Reporter, Jennifer Helton Small, Deputy Atty. Gen., Nashville, for Attorney General as intervenor.

W.W. McNeilly, Jr., Steven D. Parman, Watkins, McGugin, McNeilly & Rowan, Nashville, for Dr. Charles Cannon, Jr.

OPINION

FONES, Justice.

In this medical malpractice case, which has not been tried on its merits, the threshold issue is whether worker's compensation benefits are included in a section of the Medical Malpractice Act of 1975 that gives health care providers a reduction in damages for benefits available to tort victims from several specifically named collateral sources "or any other source." If worker's compensation benefits are included, Nance and Stauffer raise two additional issues: (1) whether the section is constitutional; (2) whether the employer, Stauffer, is entitled to enforce its subrogation lien, even though the employee cannot recover any benefits paid or payable under the worker's compensation act?

Paul Nance injured his back while in the course and scope of his duties as an employee of Stauffer Chemical Company. He was admitted to West Side Hospital for disc surgery. A spinal anesthetic was administered by a doctor associated with the Middle Tennessee Anesthesiology group. The surgery was abandoned in an early stage allegedly due to the patient's reaction to the anesthetic. Nance suffered cerebral anoxia, is confined to a nursing home and is allegedly totally and permanently disabled.

This suit was instituted by Paul Nance's guardian against the hospital, the anesthesiology group and the doctor who administered the anesthetic. Stauffer filed an intervening petition wherein it alleged the payment of in excess of $162,000 in medical expenses, $40,728 in temporary total and permanent disability benefits, and liability for substantial future medical payments, all as required of it by the worker's compensation act as Nance's employer. Stauffer asserted its statutory lien against any recovery by Nance for the sums paid and to be paid as worker's compensation benefits.

One of the defenses asserted by defendants was that T.C.A. Sec. 29-26-119, a section of the Medical Malpractice Review Board and Claims Act of 1975, eliminated as damages that may be awarded against health care providers, sums paid or payable to victims of medical malpractice from sources identified therein. ¹ Defendants insisted that the statute applied to benefits paid or payable under the worker's compensation act and imposed a ban upon any recovery of such benefits by Nance or Stauffer.

Nance and Stauffer denied that the statute included workers compensation benefits as a collateral source, but if applicable asserted that it was unconstitutional. Nance also asserted that if the statute was applicable and constitutional, no part of his recovery from defendants would be subject to Stauffer's subrogation lien.

All of the parties filed partial summary judgment motions based upon the foregoing contentions. The trial court held that T.C.A. Sec. 29-26-119 applied to worker's compensation benefits and that the statute was constitutional. However, the trial court agreed with plaintiff that since plaintiff was denied recovery to the extent of workers' compensation benefits paid or payable, Stauffer could not assert its subrogation lien granted under the worker's compensation act and dismissed its intervening petition.

After the dismissal of Stauffer's intervening petition, Nance and Stauffer moved for entry of a final judgment as to the dismissal of Stauffer's intervening complaint, pursuant to T.R.C.P. 54.02. The trial judge granted that motion in an order wherein he also granted an interlocutory appeal under T.R.A.P. 9. The Court of Appeals held that Stauffer was not entitled to an appeal as of right, "because all parties and issues have not been disposed of at the trial level." Nevertheless, that court waived the "infirmity" and decided the issues. The intermediate court obviously overlooked the trial judge's action in entering a final judgment against Stauffer on 8 January 1986 pursuant to T.R.C.P. 54.02, the effect of which entitled Stauffer to pursue a T.R.A.P. 3 appeal as of right. See T.R.A.P. 3 and 9 and T.R.C.P. 54.02.

The Court of Appeals held that worker's compensation benefits were not "insurance furnished by an employer" and were not otherwise included in the language of the statute. It also held that worker's compensation benefits were not of the same kind and character as the sources specifically mentioned in the statute, and hence were not included in the phrase "any other source," pursuant to the doctrine of ejusdem generis. The intermediate court held that the legislature could not have intended to include worker's compensation benefits as a collateral source, because of the grossly unjust results of such inclusion upon both the employer and the employee. That court reinstated Stauffer's intervening petition to enforce its statutory subrogation lien against any recovery by Nance. The constitutional question was pretermitted.

The parties have provided the court with excellent and voluminous briefs. The equities and inequities of including worker's compensation benefits within the scope of the statute have been exhaustively treated. However, this issue involves the interpretation of statutory language and the maxims and principles of statutory interpretation applicable in this instance do not involve equitable considerations.

Statutes pursuing the same general objective as T.C.A. Sec. 29-26-119 are a part of medical malpractice acts adopted by the overwhelming majority of our sister states. They are referred to as "collateral source statutes" because of their common objective of reducing the damages recoverable by tort victims from health care providers, by the amount the tort victim realizes from collateral sources, with the result that a double recovery by the tort victim is avoided. These statutes are designed to abrogate the collateral source rule that prevails in the great majority of the states, to-wit: that benefits received by a plaintiff from a source wholly independent of and collateral to the tort feasor, as a result of the injury inflicted, will not diminish the damages otherwise recoverable from the defendant. See 22 Am.Jur.2d Damages, Sec. 206 et seq. (1965). There is a complete lack of uniformity in the drafting of these collateral source statutes. Almost the only thing they have in common is the listing of insurance by employers and social security benefits as a common collateral source.

The collateral sources expressly identified in the Tennessee statute to reduce recovery are insurance provided by an employer, social security, service and unemployment benefits. Immediately following that listing is the phrase "or any other source". The learned trial judge disposed of the question of legislative intent with respect to the inclusion of worker's compensation benefits as follows:

The collateral source rule abolition covers a much broader category of payments than those made by insurance, however. Indeed, it includes payments from "any other source." The court must conclude that the legislature meant just what it said--any source. Thus, payments by an employer as worker's compensation are payments embraced by the statute and Nance cannot recover them.

The Court of Appeals held that the phrase "or any other source" invoked the doctrine of ejusdem generis. The intermediate court said that worker's compensation benefits were "statutory and sui generis " and concluded without further analysis that such benefits "are not of the same kind and character as the sources specifically mentioned in the law, hence are not included in the meaning of the words 'any other source.' " In short, that court simply placed worker's compensation benefits in a class by itself, the only one of its kind, the literal meaning of sui generis. We think that analysis falls short of the proper application of the classification aspect of the rule of ejusdem generis.

The rule ejusdem generis is that where general words follow special words, which limit the scope of a statute, the general words will be construed, ordinarily, as applying to things of the same kind or class as those indicated by the preceding special words. The rule can only be used as an aid in ascertaining the legislative intent, and not for the purpose of controlling the intention or of confining the operation of a statute within narrower limits than was intended by the general assembly. See, e.g. State v. Grosvenor, 149 Tenn. 158, 258 S.W. 140 (1923); State v. Wheeler, 127 Tenn. 58, 152 S.W. 1037 (1912) and Sutherland Statutory Construction (4th ed.) Sec. 47.17 et seq.

The statute we are to construe presents a classic example for the application of that rule. We have the general words "or any other source" following the special words, "insurance provided by an employer either governmental or private, by social security benefits, service benefits programs, unemployment benefits." The...