Olariu v. Marrero

• Decision Date: 23 February 2001
• Docket Number: No. A00A2310.,A00A2310.
• Parties: OLARIU v. MARRERO.
• Court: Georgia Court of Appeals

549 S.E.2d 121

248 Ga. App. 824

OLARIU v. MARRERO.

No. A00A2310.

Court of Appeals of Georgia.

February 23, 2001.

Reconsiderations Denied March , 2001.

Certiorari Denied September 17, 2001.

Brennan, Harris & Rominger, Mason White, James D. Kreyenbuhl, Savannah, Hertz & Link, Houston D. Smith III, Tucker, for appellant.

Slappey & Sadd, James N. Sadd, Atlanta, for appellee.

ANDREWS, Presiding Judge.

On March 1, 1997, Carmen Marrero was injured when the truck in which she was a passenger collided with a vehicle driven by Ovidiu Olariu. She sued Olariu for personal injury and loss of consortium. The jury found for Marrero and awarded damages. On appeal, Olariu challenges Marrero's recovery of past medical expenses written off by the health care provider or discharged in bankruptcy. Olariu also claims that the trial court erred in charging the jury on lost earnings and by failing to grant his motion for judgment notwithstanding the verdict on the issue of lost earnings. For reasons set forth below, we reverse the trial court's ruling allowing Marrero to recover medical expenses previously discharged in bankruptcy, but otherwise affirm.

1. The jury awarded Marrero $36,620.20 in past medical expenses.¹ To show medical costs, Marrero introduced a bill for her initial treatment at Gwinnett County Medical Center in the amount of $21,770.42. Before the trial, Olariu deposed a medical center employee who testified that Marrero's $21,770.42 bill had been partially written off by the hospital and that $1,500 remained payable by Marrero. Marrero filed a motion in limine to exclude the deposition. The trial court found that the reduction of Marrero's hospital bill was equivalent to a recovery from a collateral source and excluded from evidence any reference to the hospital's write-off of Marrero's initial medical bill.

The common law rule in Georgia bars the defendant from presenting any evidence as to payments of medical, hospital, disability income, or other expenses of a tortious injury paid for by a plaintiff, governmental entity, or third party and taking credit towards the defendant's liability in damages for such payments, because a tortfeasor is not allowed to benefit by its wrongful conduct or mitigate its liability by collateral sources provided by others. The common law rule made no exceptions for the introduction of evidence as to a collateral source, which rule remains applicable today.

(Citations omitted.) Candler Hosp. v. Dent, 228 Ga.App. 421, 491 S.E.2d 868 (1997). See also Ins. Co. of North America v. Fowler, 148 Ga.App. 509, 511(2), 251 S.E.2d 594 (1978), overruled on other grounds, Seaboard Coast Line R. v. Mobil Chemical Co., 172 Ga.App. 543, 544(1), 323 S.E.2d 849 (1984).

The trial court found Candler Hosp., supra, to be controlling. There, the plaintiff sued the defendant hospital for malpractice. We agreed with the lower court that the hospital's write-off of plaintiff's medical expenses must be treated as a collateral source and that the plaintiff could prove all medical expenses undiminished by the write-off. We also held that the defendant hospital must be allowed to apply its write-off of the plaintiff's medical bills as a credit against a specific award of medical expenses. Id. at 422, 491 S.E.2d 868.

Olariu argues that Marrero would benefit unjustly from an award of medical expenses unless Olariu were allowed to present evidence of the write-off of medical expenses to the jury or, alternatively, Marrero was prohibited from recovering medical expenses which had been written off.

Georgia law prohibits presentation to the jury of payment of damages by a collateral source. McDonald v. Simmons, 207 Ga.App. 692, 428 S.E.2d 690 (1993). Candler Hosp. establishes that a write-off of medical expenses is a collateral source of payment. The trial court did not err in granting Marrero's motion in limine to exclude evidence of the write-off.

Olariu's argument that Marrero should not be allowed to recover medical expenses written off by the hospital runs counter to the general rule that a defendant is not entitled to a credit for collateral payments to the plaintiff. See Cincinnati &c. R. Co. v. Hilley, 121 Ga.App. 196, 199-201, 173 S.E.2d 242 (1970). This is in contrast to a prior payment to the plaintiff made by or on behalf of the defendant or a joint tortfeasor. The holding in Candler Hosp. is that a "plaintiff can recover from the jury all special damages provable, but cannot receive in judgment again what has already been paid by the defendant or on the defendant's behalf by an insurer." Candler Hosp., 228 Ga.App. at 423, 491 S.E.2d 868. The set-off in Candler Hosp. prevented a double recovery against the defendant, but Olariu has made no prior payments to Marrero with respect to her medical costs.

Olariu is not liable to pay Marrero's medical expenses twice, but the existence of a collateral source will not accrue to his benefit and allow him to avoid these otherwise payable damages. "Georgia does not permit a tortfeasor to derive any benefit from a reduction in damages for medical expenses paid by others, whether insurance companies or beneficent boss or helpful relatives." Bennett v. Haley, 132 Ga.App. 512, 522(16), 208 S.E.2d 302 (1974). Olariu is not entitled to use a third party's write-off of medical expenses as a set-off against Marrero's recovery of past medical expenses.

2. (a) Olariu argues that the trial court erred in allowing Marrero to recover any portion of her medical bills which had been previously discharged in bankruptcy. We agree. The question of whether or not medical expenses discharged in bankruptcy should be treated as a collateral source of payment is one of first impression. Marrero cites Crozier v. State, 233 Ga.App. 831, 506 S.E.2d 139 (1998) to support her argument that a plaintiff's discharge of medical expenses in bankruptcy should not relieve a defendant from responsibility for those costs. Crozier, however, involves a payment in criminal restitution rather than a tort claim and is not controlling. Although a reasonable argument can be made for treating debts discharged in bankruptcy as subject to the "collateral source rule," we hold that a plaintiff may not recover in tort special damages for medical expenses previously discharged in bankruptcy. There are two compelling reasons for so holding. First, the effects of a bankruptcy do not constitute a "collateral source" at all. There is no third party acting as an additional source of recovery. Debts in bankruptcy become unrecoverable by operation of law. See 11 USC § 524(a)(2). In contrast, a collateral source is generally a third party which has voluntarily provided a benefit through a bargained-for agreement, such as an insurer or as a gratuity. See Bennett v. Haley, supra; Smith v. Jernigan, 42 Va. Cir. 395 (1997). The second reason for not extending the collateral source rule is that to hold otherwise might encourage bankruptcy, which is not consistent with public policy. See Oliver v. Heritage...