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Next Week at the Court – April 5, 2010

April 2, 2010

After a weeks-long hiatus from oral argument while issuing several significant opinions, the Georgia Supreme Court returns on Monday to hear one day of argument on April 5, then will have an additional day of argument on April 12.  The Court will be hearing seven cases on Monday, with two of which involve civil issues.

Monday, April 5, 2010 at 10:00 am Sitting

S09G1710. STATE FARM AUTOMOBILE INSURANCE COMPANY v. ADAMS

This case originated with two individuals involved in a a car wreck, one without sufficient insurance.  The plaintiff was covered by State Farm for up to $100,000 in uninsured motorist coverage, but the defendant only carried a $25,000 Nationwide policy.  Nationwide paid $9,217.66 to Grady Hospital on a lien, and $15,782.34 to the plaintiff directly.  When the plaintiff sought to have State Farm cover the value of the $100,000 uninsured motorist policy, State Farm said it was entitled to set off (reduce its payment by) the entire $25,000 paid by Nationwide.  The plaintiff claimed State Farm could only set off the $15,782.34 paid directly to him.

The trial court found that State Farm could set off the entire $25,000.  The Court of Appeals, in a 4-3 decision (Barnes, Miller, Ellington, and Phipps voting in the majority; Johnson, Blackburn, and Smith voting in the minority), reversed the trial court, finding that the payment to satisfy the hospital lien should be treated like liens imposed by federal law.  Thus, the majority concluded that State Farm is not allowed to take credit for the $9,217.66 paid to satisfy the hospital lien.  The dissent argued that the federal liens on a party’s settlement were not similar to a hospital lien, because in Thurman, the only reason why the federal lien was not counted against the settlement was because the Georgia Supreme Court found the federal law contradicted the Georgia law at issue.

The Supreme Court granted certiorari in a 6-1 vote (Carley dissenting) to review the following issue:

  1. Did the Court of Appeals err in extending the rationale of Thurman v. State Farm Mut. Auto. Ins. Co., 278 Ga. 162 (2004), to the satisfaction of a hospital lien by the tortfeasor’s liability insurer?

The case will be argued on Monday, April 5, 2010 at the 10:00 am sitting.

S09G1876. AMERICAN INTERNATIONAL SOUTH INSURANCE COMPANY v. FLOYD

In a case that relies directly on State Farm v. Adams (discussed above) and has similar facts, a separate panel of Court of Appeals judges (Doyle, Blackburn, and Adams) unanimously reversed the trial court’s decision which did not allow the uninsured motorist policy to be reduced by the outstanding hospital lien.

The Supreme Court granted certiorari in a 6-1 vote (Carley dissenting) to review the following issue:

  1. Did the Court Of Appeals err in extending the rationale of Thurman v. State Farm Mut. Auto. Ins. Co., 278 Ga. 162 (2004), to the satisfaction of a hospital lien by the tortfeasor’s liability insurer.

The case will be argued on Monday, April 5, 2010 at the 10:00 am sitting.

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