In an opinion handed down on May 8, the Texas Supreme Court has upheld a San Antonio district court and 4th Court of Appeals decision regarding the formation of a judgment in a medical malpractice claim in which the application of the settlement credit and the $250,000 cap on non-economic damages are at issue.
In Regent Care of San Antonio, L.P. v. Detrick (No. 19-0117), the plaintiff sued Regent Care, a skilled nursing facility, for failing to report a change in the plaintiff’s medical condition to his physicians, which resulted in the delayed diagnosis of a tumor in the plaintiff’s spinal canal. This delay exacerbated pressure on his spinal cord, which caused paralysis. The plaintiff also sued his physicians and their medical practices but settled with them before trial for $1,850,000. At trial the jury assigned 55% of the responsibility for the plaintiff’s injury to Regent Care and awarded $3 million for future medical expenses, $390,000 for past medical expenses, and $10,250,000 in noneconomic damages. The trial court further calculated prejudgment interest on the past medical expenses in the amount of $51,375.
Regent Care elected the dollar-for-dollar settlement credit under CPRC §33.012(c). The trial court applied the credit by first determining the percentages of economic and noneconomic damages awarded by the jury (27%/73% in this case), applied the credit first to the prejudgment interest, and then subtracted 27% of the settlement amount from the economic damage award and 73% of that amount to the noneconomic damages award. This yielded a recovery of $3,149,371 in economic damages and $8,937,004 in noneconomic damages. Finally, the trial court applied the $250,000 cap to the noneconomic damages award and rendered judgment for the plaintiff.
On appeal, Regent Care argued that the trial court should have applied the cap on noneconomic damages to the jury award before subtracting the dollar-for-dollar credit. Applying SCOTX reasoning in a similar case under the Tort Claims Act, the San Antonio Court of Appeals affirmed the the trial court’s judgment. Regent Care subsequently appealed to SCOTX.
In an opinion by Justice Busby, SCOTX affirmed the Court of Appeals. The Court reasoned that a distinction exists between a claimant’s recovery and the defendant’s liability. Under Chapter 74, TCPRC, a health care provider’s liability for noneconomic damages is limited to $250,000. The amount of the plaintiff’s recovery, however, is the amount of damages awarded by the jury less the settlement credit under §33.012. Since Regent Care’s liability for noneconomic damages was capped at $250,000 and that amount did not exceed the amount the plaintiff could recover after application of the credit, no further credit was appropriate. The Court further opined that the trial court’s method of calculation did not violate the one satisfaction rule.
The other major issue in the case involves the standard of review of a trial court’s order that future damages be paid periodically rather than in a lump sum. Chapter 74, Subchapter K, TCPRC, the trial court shall order periodic payments of all or part of future damages at the request of a defendant health care provider. In doing so, the trial court shall make a specific finding of the dollar amount of periodic payments that will compensate the plaintiff for future damages and shall specify the amount, number, timing, and recipient of the payments in the judgment. Regent Care argued that the record did not support he trial court’s order in this case, whereas the plaintiff contended that a trial court has the discretion to split the payment of future damages.
SCOTX ruled that review of a trial court’s order of periodic payments will be reviewed on an abuse of discretion standard. While the basis of the order must be found in the record, the defendant requesting periodic payments has the burden of identifying for the trial court sufficient evidence regarding each of the required findings (that is, amount, number, timing, and recipient of payments). Additionally, the trial court has discretion to receive additional evidence on periodic payments after trial, as long as that evidence is not used to contradict the jury’s findings. Finally, a trial court has no discretion to craft its own award inconsistent with the jury’s verdict. Reviewing the record in this case, SCOTX held that the trial court did not abuse its discretion.
This is an important decision that strengthens Chapter 74. SCOTX’s opinion is consistent with the reasoning of the amicus brief filed by our allied organizations, Texas Alliance for Patient Access (TAPA), TMA, THA, and TMLT. We applaud SCOTX for its continuing fidelity to the statutory language of Chapter 74 and to maintaining the integrity of legislatively enacted reforms.
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