author: Phipps, Judge.

text:
    A00A1153.
    KUEFFER CRANE & HOIST SERVICE, INC. v. PASSARELLA.
    (543 SE2d 113)
   Phipps, Judge.

Lawrence Passarella sued Kueffer Crane & Hoist Service, Inc. for a declaratory judgment that he was a five percent owner of the corporation and for damages amounting to five percent of the corporation’s 1997 profits, plus interest. A jury returned a verdict in favor of Passarella, and Kueffer Crane appeals, raising three issues. Kueffer Crane contends that the trial court erred in failing to give its requested instruction on the statute of frauds, in failing to grant it a directed verdict on its statute of limitation defense, and in failing to grant a directed verdict because Passarella had failed to establish the essential terms of an enforceable oral contract. We affirm because we find that the statute of frauds was inapplicable, that the statute of limitation had not run, and that the oral agreement which Passarella sued upon was sufficiently definite to be enforceable.

In 1990, Passarella and Mitch Kueffer worked together at Kone Cranes. Kueffer left Kone Cranes to form his own company, Kueffer Crane. Passarella testified that because of his expertise in servicing and repairing cranes, Kueffer offered him a five percent interest in Kueffer Crane to come to work for Kueffer Crane. In August 1991, Passarella left Kone Cranes and went to work at Kueffer Crane. He remained there until October 1997, when he resigned after Kueffer told Passarella that he “[could] no longer work with [him].”

For the years 1992 through 1996, Passarella received checks for profit sharing or bonuses that equated to five percent of Kueffer Crane’s profits. Passarella also testified that he received numerous oral assurances from Kueffer that he was a five percent interest holder in the corporation.

After Passarella resigned from Kueffer Crane, he did not receive a share of the profits for 1997. In March 1998, Passarella made a written demand for five percent of the 1997 profits and to review the corporate records for that year. Kueffer Crane denied Passarella’s demands and asserted that Passarella had no ownership in the corporation. On July 17, Passarella filed this action. It was tried in August 1999.

1. Former OCGA § 11-8-319 (statute of frauds) detailed the circumstances under which a contract for the sale of securities was enforceable. Effective July 1, 1998, the General Assembly repealed OCGA § 11-8-319 and enacted OCGA § 11-8-113, which provides:

A contract or modification of a contract for the sale or purchase of a security is enforceable whether or not there is a writing signed or record authenticated by a party against whom enforcement is sought, even if the contract or modification is not capable of performance within one year of its making.

Assuming that OCGA § 11-8-319 remained applicable to causes of action which predated its repeal, it would not have applied to the oral agreement between Passarella and Kueffer. We find that this case is analogous to Thompson v. Kohl, where we held that “an oral agreement by an employer to transfer corporate stock to an employee for a non-monetary consideration is not a ‘sale’ within the meaning of UCC § 8-319.” Thus, we find no error in the trial court’s decision not to charge the jury on the statute of frauds.

2.

A directed verdict is proper only if there is no conflict in the evidence as to any material issue and the evidence introduced, with all reasonable deductions therefrom, shall demand a particular verdict. In determining whether any conflict in the evidence exists, the court must construe the evidence most favorably to the party opposing the motion for directed verdict. The standard used to review the grant or denial of a directed verdict is the any evidence test.

The statute of limitation for an action based on an oral contract is four years from the date the action accrued. “[A] cause of action accrues when the plaintiff could have first maintained the action to a successful result.” We will affirm the denial of the motion for directed verdict if there is any evidence to support a determination that Passarella’s claim arose within four years of the date this action was filed, July 17, 1998.

Passarella testified that Kueffer induced him to come to Kueffer Crane by promising him five percent ownership and reaffirmed that many times. It is undisputed that at the end of each full calendar year that Passarella worked for Kueffer Crane, Passarella received a check in the amount of five percent of Kueffer Crane’s profits for that year. And Passarella testified that each time he received the five percent profit share, Kueffer expressed that it was being paid to him as a part owner of the company.

Kueffer denies having promised Passarella an ownership interest in the corporation and asserts that even under the testimony of Passarella and Kendle Ellzey, another former employee of Kueffer Crane, the statute of limitation would have started running in 1992, when they assert they asked him for stock certificates, and he responded that the costs of having the certificates issued was too prohibitive at the time. In essence, Kueffer contends that even if there was an oral agreement, it was breached by the refusal to issue stock certificates, and the statute began running at that time.

But the failure to issue stock certificates was not necessarily a breach of the agreement to make Passarella a part owner. Passarella and Ellzey each testified that Kueffer did not indicate that he would never issue the certificates. And Passarella testified that Kueffer never suggested that he did not consider Passarella a part owner. Moreover, one may have an ownership interest in a corporation without having received stock certificates. We find that Kueffer did not clearly breach the agreement until he refused to pay Passarella his 1997 profit share and told him that he did not have an ownership interest in the corporation.

Kueffer Crane relies on Leathers v. Timex Corp and Palmer v. Neal. We find that each case is distinguishable. In Leathers, a retiree did not file suit until almost six years after he had learned that his pension was not being calculated in accordance with oral assurances he had received when he retired. Passarella, on the other hand, filed suit within months after the first actions by Kueffer Crane which could be considered a breach.

In Palmer, the plaintiff was given an oral assurance that he would receive ten percent of the stock of the defendant’s corporation. The plaintiff never received the stock he had been promised but waited six years after the assurance to file suit for breach of contract. Passarella’s agreement with Kueffer was for a five percent ownership interest in Kueffer Crane, and Passarella presented evidence that Kueffer treated him as a part owner throughout his employment at Kueffer Crane. For five consecutive years, Passarella received the value of the five percent interest he had been promised.

The trial court did not err in denying Kueffer Crane’s motion for directed verdict on the statute of limitation defense.

3. Relying upon Demer v. Capital City Cable, Kueffer Crane asserts that the alleged oral promise was too indefinite to be enforceable. “ ‘The test of an enforceable contract is whether it is expressed in language sufficiently plain and explicit to convey what the parties agreed upon. [Cit.]’ [Cit.]” “ ‘[IJndefiniteness in subject matter so extreme as not to present anything upon which the contract may operate in a definite manner renders the contract void.’ [Cits.]” “The law does not favor destroying contracts on the basis of uncertainty.”

Here, we find that the agreement was sufficiently plain and explicit as to what consideration Passarella was to receive for joining Kueffer’s upstart corporation. This case is distinguishable from Demer, where the plaintiff asserted that a preemployment letter entitled him to $100,000 worth of stock under an equity participation plan, but conceded that “ ‘there were a great number of things to be agreed upon in the future’ ” about his participation in the plan. The plaintiff did not know the type, number, or issuer of the shares he expected to receive, did not know the valuation method for the shares, and did not know what the letter meant by such phrases as “ ‘certain conditions will apply to this arrangement’ ” and defendant will have “ ‘repurchase rights.’ ”

Decided December 1, 2000

Reconsideration denied December 14, 2000

McGarity & Lloyd, J. Michael McGarity, Howard W. Reese III, for appellant.

Neil A. Moskowitz, for appellee.

Unlike the agreement in Demer, Passarella’s agreement with Kueffer did not leave matters to future negotiations. We find that the instant agreement was sufficiently definite to authorize the trial court to deny Kueffer Crane’s motion for directed verdict.

Judgment affirmed.

Johnson, C. J., and Smith, P. J., concur.

       See OCGA Title 11, Article 8.

       “[L]egislation which involves mere procedural or evidentiary changes may operate retrospectively[;] legislation which affects substantive rights may operate prospectively only.” Enger v. Erwin, 245 Ga. 753, 754 (267 SE2d 25) (1980). Substantive law creates rights, duties, and obligations. Dept. of Human Resources v. Deason, 238 Ga. App. 853, 856 (1) (520 SE2d 712) (1999). Procedural law prescribes the methods of enforcement of rights, duties, and obligations. Id.

       216 Ga. App. 148, 151 (2) (453 SE2d 485) (1994).

       (Citation omitted.) Griffith v. Med. Rental Supply &c., 244 Ga. App. 120 (534 SE2d 859) (2000).

        Mallin v. Spickard, 103 Ga. App. 562 (120 SE2d 128) (1961); see also OCGA § 9-3-25.

        Kicklighter v. Woodward, 267 Ga. 157, 159 (2) (476 SE2d 248) (1996) (citing Engram v. Engram, 265 Ga. 804 (463 SE2d 12) (1995)).

        Haas v. Koskey, 138 Ga. App. 448, 453 (2) (226 SE2d 279) (1976); First Jewelers v. Rosen, 119 Ga. App. 355, 356 (166 SE2d 919) (1969).

       174 Ga. App. 430 (330 SE2d 102) (1985).

       602 FSupp. 882 (N.D. Ga. 1984).

       190 Ga. App. 40 (378 SE2d 162) (1989).

       Id. at 43.

        Sanders v. Commercial Cas. Ins. Co., 226 Ga. App. 119, 120 (1) (485 SE2d 264) (1997).

       Id. at 121.

        Demer, supra, 190 Ga. App. at 42.

       See id. at 43 (nothing can be left to future negotiations).

       Id. at 42.


source: Caselaw Access Project

author: Ruffin, Judge.

license: Public Domain

text:
    A00A1267.
    CONTINENTAL INSURANCE COMPANY v. AMERICAN MOTORIST INSURANCE COMPANY.
    (542 SE2d 607)
   Ruffin, Judge.

This appeal arose from a dispute as to which of two insurance companies, Continental Insurance Company (“Continental”) or American Motorist Insurance Company (“American”), bore responsibility for a personal injury claim arising from the use of a certain piece of equipment known as a “pallet jack.” The trial court granted summary judgment to American and denied the same to Continental. After examining the language of the two insurance policies, we find that the Continental policy provided coverage while the American policy did not. Thus, we affirm.

Neither American nor Continental disputes the facts underlying the personal injury claim which occurred when Nora Wilkes, an employee in the warehouse department of Market Office Products, sustained injuries while providing assistance to Andrew Sheahan, a deliveryman. At Sheahan’s request, Wilkes had agreed to help Sheahan push a pallet loaded with copier paper up the ramp outside the warehouse. When Sheahan suddenly lost control of the pallet while he was pulling it up the ramp, Wilkes was injured. Sheahan had been moving the load using a hand-powered device known as a “pallet jack.”

At the time of these events, Sheahan was driving a delivery truck leased by United Stationers Supply Company (“United Stationers”) and was employed by TLI, Inc., a company which provided delivery drivers to United Stationers. A contract between United Stationers and TLI required United Stationers to maintain a business automobile liability insurance policy that named TLI as an additional insured for the operation of United Stationers’ vehicles by TLI employees. United Stationers purchased such a policy from American. This policy protected against liability for bodily injury claims caused by anyone using a United Stationers’ vehicle who had permission to use a covered vehicle unless an exclusion otherwise removed such injury from coverage.

United Stationers had also purchased a comprehensive business policy from Continental which included commercial general liability (“CGL”) protection. United Stationers’ CGL policy provided liability coverage for bodily injuries but excluded those bodily injuries arising out of the use of any “auto” including loading or unloading. The policy defined “loading and unloading” as the handling of property while it is being moved from an automobile to the place where it is finally delivered. However, the exclusion had an exception — in that unloading “does not include the movement of property by means of a mechanical device, other than a hand truck, that is not attached to the aircraft, watercraft or ‘auto.’ ”

Although Wilkes brought her personal injury suit against Sheahan and United Stationers, she later dismissed United Stationers without prejudice and obtained a default judgment for $750,000 against Sheahan, who had failed to answer her complaint. United Stationers supplied a copy of Wilkes’ complaint to Arnold Pritsker, a senior vice president at Mesirow Insurance Services, an insurance brokerage firm. Pritsker had procured both the American and Continental policies for United Stationers. He forwarded the complaint to Continental because he “had no reason to believe it was anything other than general liability.” In Pritsker’s view, the claim fit within general liability coverage since the product had been delivered to the customer, in the sense that it was no longer on the delivery truck.

Continental undertook the defense of United Stationers without a reservation of rights and did not file a declaratory judgment action to ascertain its liability. Although Continental provided a defense to United Stationers, it failed to do so for Sheahan, thereby precipitating the default judgment. American did not receive actual notice of the incident until May 1994 — nearly three years after it occurred and after the default judgment.

After Wilkes obtained the $750,000 default judgment in state court against Sheahan, she then filed an action in federal court directly against Continental to collect that judgment. In the federal suit, Wilkes claimed to be a third-party beneficiary of the insurance policy issued to United Stationers by Continental. Continental settled the federal case with Wilkes for $450,000, then sued American in the Superior Court of Fulton County to seek reimbursement for the settlement. Both companies moved for summary judgment on the issue of liability, and American prevailed. Continental appeals the trial court’s order denying its motion for summary judgment and granting summary judgment to American.

1. Continental contends that the trial court erred in denying its motion for summary judgment. Continental claims that the exclusion in United Stationers’ policy with American is ambiguous. Continental argues that American, as the drafter of the exclusion, has the burden of proving that it applies. According to Continental, the pallet jack that Sheahan was using to unload the delivery truck could be considered a “hand truck,” and would therefore be covered by the business automobile policy issued by American.

In deciding this issue, we must try to ascertain the intention of the parties by looking to the insurance contract as a whole. In so doing, we consider the ordinary and legal meaning of the words employed in the contract. Although it is certainly true that an exclusionary provision must be construed strictly against the insurer, it is equally true that the construction must be a reasonable one. We find that the construction urged by Continental is not reasonable in the context of this case.

The business automobile policy that United Stationers had with American stated in pertinent part:

B. Exclusions!:] This insurance does not apply to any of the following: 7. HANDLING OF PROPERTY[:] “Bodily injury” or “property damage” resulting from the handling of property: . . . [a]fter it is moved from the covered “auto” to the place where it is finally delivered by the “insured.” [and] 8. MOVEMENT OF PROPERTY BY MECHANICAL DEVICE [:] “Bodily injury” or “property damage” resulting from the movement of property by a mechanical device (other than a hand truck) unless the device is attached to the covered “auto.”

The Continental policy, on the other hand, excluded coverage for bodily injuries arising out of the use of any “auto” and specifically provided that “use” included “loading and unloading.” The policy defined “loading and unloading” as the handling of property “[w]hile it is being moved from an . . . ‘auto’ to the place where it is finally delivered.” But an exception to the exclusion applied to personal injuries resulting from “unloading” that involved the movement of property by means of a mechanical device that is not attached to the “auto.”

In sum, United Stationers’ business automobile policy with American provided coverage for personal injuries involving a hand truck or a mechanical device attached to a covered “auto”; while the Continental comprehensive business policy covered “unloading” by means of a mechanical device, other than a hand truck, not attached to an insured vehicle. Since the bodily injury to Wilkes occurred while Sheahan was handling or delivering or unloading property while using a “pallet jack,” the dispositive issue is whether that device can be considered a hand truck. If the object that rolled into Wilkes falls within the ambit of “a mechanical device other than a hand truck,” only the policy with Continental would apply. But if the pallet jack falls within the meaning of “hand truck,” then only the policy with American would apply.

The pallet jacking device that Sheahan was using is a piece of equipment which uses a hydraulic cylinder to lift a pallet. It has four wheels, two large wheels at the rear and two smaller wheels at the front which support two forks or prongs. This implement is designed so that the two forks can be inserted directly into a pallet and the pallet can then be raised off the floor by hydraulically pumping a handle. This apparatus is capable of lifting loads as heavy as 5,000 pounds. It is undisputed that it was not attached to the delivery truck at the time of the incident and is not intended to attach to a vehicle. Therefore, unless, this “pallet jack” could be considered to be a “hand truck,” the exception to the exclusion would not apply.

In construing an insurance policy, the test is not what the insurer intended its words to mean, but what a reasonable person in the position of the insured would understand them to mean. “The policy should be read as a layman would read it and not as it might be analyzed by an insurance expert or an attorney.” And, it is the insurer’s duty to define clearly and explicitly limitations on coverage.

Here, the ordinary meaning of a “hand truck,” is a hand-operated piece of equipment for moving objects. The Random House Webster’s Unabridged Dictionary (2nd ed. 1997), a source a layman might consult, defines a hand truck to mean:

2. any of various wheeled frames used for transporting heavy objects. 3. Also called hand truck, a barrowlike frame with low wheels, a ledge at the bottom, and handles at the top, used to move heavy luggage, packages, cartons, etc. 4. a low, rectangular frame on which heavy boxes, crates, trunks, etc., are moved; a dolly.

(Emphasis in original.)

United Stationers considered a pallet jack to be a separate piece of equipment from hand trucks, and, in fact, United Stationers routinely equipped its delivery drivers with both hand trucks and pallet jacks. Each device was intended to serve distinctly different functions. “The only occasion the drivers had to use the device they were supplied which was actually called a “hand truck’ was to accomplish deliveries ‘on very small orders.’ ” Unlike an ordinary hand truck, the pallet jack’s hydraulic pumping mechanism could lift substantially heavier loads.

In the federal litigation between Wilkes and Continental, the district court found that this particular implement is not a hand truck. Although we are not bound by the federal court’s finding, we find it illuminating. In the district court’s view, the fact that “a pallet jack is designed to carry much larger loads than a dolly or wheelbarrow, and in fact must utilize a hydraulic cylinder so that the loads may be lifted from the ground, suggests that the pallet jack is ‘a mechanical device other than a hand truck.’ ” That court decided that the pallet jack at issue did not fit naturally within the dictionary definition or the ordinary understanding of the term “hand truck” as a small dolly or wheelbarrow used to manually lift and move small loads. We see no compelling reason to find otherwise. Accordingly, since a reasonable interpretation of the Continental policy compels the conclusion that the policy provided coverage for the unloading incident, the trial court properly denied Continental’s motion for summary judgment.

2. Continental contends that the trial court erred in granting summary judgment to American. Continental claims that the CGL policy and the business automobile policy afforded overlapping coverage and the issue as to which policy provided primary coverage must still be resolved. We do not agree.

In the federal litigation, Continental urged a contrary position. In its brief filed in the district court, Continental argued:

[t]he insuring provisions and exclusions of the CGL and Business Auto Forms are designed to provide seamless, but not overlapping coverage for different aspects of “unloading.” The risks associated with the unloading of commercial vehicles have been deliberately segregated into two coverages. If the unloading was performed by a “hand truck” then the business auto form provides coverage. If, some mechanical device other than a hand truck not attached to the truck was used in the unloading, then the CGL Form provides coverage.

Despite previously arguing that the two policies were not overlapping, Continental now asserts that the loss was covered by both policies. Continental argues that since the exclusionary language in both policies is “identical” and since the federal court found such language “ambiguous,” then “the respective exclusions in both policies simultaneously fail, leaving the loss in question covered by both policies.” We find Continental’s earlier position — that the two insurance policies were intended to provide distinctly different coverage — to be more persuasive. Continental offered no evidence that United Stationers intended to purchase duplicative coverage, and industry practice suggests otherwise. Although the trial court did not explain its decision, a judgment right for any reason will be affirmed.

Judgment affirmed.

Andrews, P. J., and Ellington, J., concur.

Decided November 21, 2000

Reconsideration denied December 14, 2000

Drew, Eckl & Farnham, James M. Poe, for appellant.

Orr & Orr, E. Wycliffe Orr, Kristine E. Orr, for appellee.

       See Nat. Union Fire Ins. Co. &c. v. American Motorists Ins. Co., 269 Ga. 768, 769 (1) (b) (504 SE2d 673) (1998) (excess insurer’s assumption of defense for insured even without issuing a reservation of rights did not foreclose subsequent recovery from primary insurer).

        Jefferson Ins. Co. &c. v. Dunn, 224 Ga. App. 732, 736 (2) (482 SE2d 383) (1997), overruled on other grounds, 269 Ga. 213, 216 (496 SE2d 696) (1998).

       See Leventhal v. American Bankers Ins. Co. &c., 159 Ga. App. 104, 108 (283 SE2d 3) (1981) (determination of timeliness should include consideration of prejudice to insurer caused by delay).

        James v. Pa. Gen. Ins. Co., 167 Ga. App. 427, 431 (2) (306 SE2d 422) (1983).

        Ryan v. State Farm &c. Ins. Co., 261 Ga. 869, 872 (413 SE2d 705) (1992).

        Cobb County v. Hunt, 166 Ga. App. 409, 410 (304 SE2d 403) (1983).

       By jacking or pumping its handle, the user can lift a heavy pallet or other property onto the blades or forks of the pallet jack, then roll the load to a new location where it can be lowered back to the floor or other surface.

        Jefferson Ins. Co., 224 Ga. App. at 736 (2).

       Id.

        St. Paul Fire &c. Ins. Co. v. Snitzer, 183 Ga. App. 395, 397 (1) (358 SE2d 925) (1987).

       See Little Rapids Corp. v. McCamy, 218 Ga. App. 111-112 (460 SE2d 800) (1995) (pallet jacking device appears to have been referred to as a “hand-operated forklift” and as a “forklift”).

       Page 10 of the federal order entered in Wilkes v. Continental Ins. Co., Civil No. 1:96-C/ V-1392-JEC, quoting from the deposition of Thomas Markowski, the General Operations Manager for United Stationers.

        Wilkes v. Continental Ins. Co., supra.

       See Matjoulis v. Integon Gen. Ins. Corp., 226 Ga. App. 459, 461 (4) (486 SE2d 684) (1997).

       See Grain Dealers Mut. Ins. Co. v. Pat’s Rentals, 228 Ga. App. 854, 855-856 (a) (492 SE2d 702) (1997) (business automobile policy and CGL policy may cover different risks to avoid overlapping coverage and reduce premiums).

        Precise v. City of Rossville, 261 Ga. 210, 212 (3) (403 SE2d 47) (1991).


author: Pope, Presiding Judge. Andrews, Presiding Judge,

text:
    A00A1393.
    WILLIAMS v. DEVELL R. YOUNG, M.D., P.C. et al.
    (543 SE2d 737)
   Pope, Presiding Judge.

In this medical malpractice action, the trial court granted summary judgment to defendants Devell R. Young, M.D., and Devell R. Young, M.D., P.C., on the ground that the statute of limitation had expired before plaintiff Margaret Williams filed her lawsuit. Williams appeals. For reasons stated below, we have decided to adopt the “continuous treatment” doctrine with respect to our statute of limitation for appropriate medical malpractice actions. Following the newly adopted “continuous treatment” doctrine, we conclude that there was a factual issue regarding the statute of limitation on Williams’ lawsuit, and we reverse the decision of the trial court.

Viewed most favorably to Williams, the evidence shows that Williams first sought treatment from Dr. Young on September 29, 1995, complaining of swelling and pain in her left ankle and foot. Williams reported that she was a diabetic and also complained of proteinuria (presence of protein in urine), elevated blood glucose and retinopathy (vision problem associated with diabetes). Dr. Young did not observe any swelling in Williams’ foot, although he testified that the absence of swelling at any given moment was not unusual, because proteinuria was a condition which could show evidence of swelling one day, then none the next. Williams went to see Dr. Young repeatedly between September 29, 1995, and September 30, 1996, with complaints about her left foot and leg. Dr. Young treated her with antibiotics and with various medications for diabetes.

At some point in January 1996, Williams told Dr. Young that the pain had increased in her foot. She claimed that she told Dr. Young that she started having additional pain after she took an awkward step in December 1995. Williams went to Dr. Young’s office repeatedly between March and June 1996, complaining of continuing problems with her left foot, including severe swelling which expanded at times to her groin area.

In June 1996, Dr. Young prescribed a lymph edema foot pump. Williams did not experience relief by using the pump. At a September 30, 1996 appointment, Williams asked again about her foot. Dr. Young replied: “[t]hat is just lymph edema. That is just a condition you have to live with.” He told Williams to return for an office visit in January 1997. The next day, October 1, 1996, Williams contacted another physician, Dr. Daniel Rhoads, and made an appointment to see him on November 4, 1996.

On November 4, 1996, Dr. Rhoads x-rayed Williams’ foot and ankle and diagnosed a dislocation of her talonavicular joint. After leaving Dr. Rhoads’ office, Williams called Dr. Young’s office, but she did not speak to him. Later, Williams called again to inform Dr. Young of Dr. Rhoads’ diagnosis — that she had three dislocated bones in her foot. Williams testified that Dr. Young said that he did not believe the diagnosis.

On December 10, 1996, Dr. Rhoads performed surgery on Williams’ foot to repair the dislocated bones. During Williams’ subsequent hospitalization, Dr. Young saw her in consultation for her diabetes. As of January 1998, Dr. Rhoads opined that the long-term prognosis for Williams’ foot was not good.

On October 28, 1998, Williams filed the instant action, alleging that Dr. Young committed malpractice when he failed to diagnose the dislocated bones in her foot. Williams’ complaint also set forth various other claims, including that Dr. Young failed to properly educate her about her diabetic condition; that he failed to obtain a necessary EKG on her and that he failed to properly document his treatment of her. Defendants filed a motion for summary judgment, arguing that Williams’ action was barred by the two-year statute of limitation, OCGA § 9-3-71 (a). The trial court granted summary judgment for the defendants.

In her sole enumeration of error, Williams argues that the trial court erred in granting the motion. She argues that the telephone consultations with Dr. Young and his continued course of treátment of her extended beyond October 28,1996, and that therefore her complaint was timely filed. We agree that summary judgment was improper, and we reverse.

OCGA § 9-3-71 (a) provides that “an action for medical malpractice shall be brought within two years after the date on which an injury or death arising from a negligent or wrongful act or omission occurred.” This statute, enacted in 1985, changed earlier law by beginning the running of the statute of limitation on the date the injury “occurred” rather than on the date of the negligent act. Jones v. Lamon, 206 Ga. App. 842, 845 (1) (426 SE2d 657) (1992). This change was in accord with general tort law which holds that the tort of negligence is not complete until an injury occurs. Shessel v. Stroup, 253 Ga. 56 (316 SE2d 155) (1984).

Lawsuits alleging negligence by misdiagnosis come in two varieties, ones in which the symptoms of the injury, usually pain, exist before the misdiagnosis and those in which the symptoms manifest themselves to the patient days or even years after the mistaken, and allegedly negligent, misdiagnosis. Compare Charter Peachford Behavioral Health System v. Kohout, 233 Ga. App. 452 (504 SE2d 514) (1998) (physical precedent); Frankel v. Clark, 213 Ga. App. 222 (444 SE2d 147) (1994); Surgery Assoc. v. Kearby, 199 Ga. App. 716 (405 SE2d 723) (1991); with Walker v. Melton, 227 Ga. App. 149, 150 (1) (b) (489 SE2d 63) (1997); Staples v. Bhatti, 220 Ga. App. 404 (1) (469 SE2d 490) (1996); Zechmann v. Thigpen, 210 Ga. App. 726, 728 (3) (437 SE2d 475) (1993).

“In most misdiagnosis cases, the injury begins immediately upon the misdiagnosis due to the pain, suffering or economic loss sustained by the patient from the time of the misdiagnosis until the medical problem is properly diagnosed and treated. The misdiagnosis itself is the injury and not the subsequent discovery of the proper diagnosis.” (Citations and punctuation omitted.) Walker v. Melton, 227 Ga. App. at 150 (1) (b). See also Daughtry v. Cohen, 187 Ga. App. 253 (1) (370 SE2d 18) (1988). Nevertheless, “[t]his is not always the case.” Walker v. Melton, 227 Ga. App. at 150. Thus:

[w]hen a misdiagnosis results in subsequent injury that is difficult or impossible to date precisely, the statute of limitation runs from the date symptoms attributable to the new injury are manifest to the plaintiff. See Zechmann, [210 Ga. App.] at 729; see generally Staples, [220 Ga. App.] at 405-406 (1). See also Whitaker [v. Zirkle, 188 Ga. App. 706, 708 (1) (374 SE2d 106) (1988)]: “When an injury occurs subsequent to the date of medical treatment, the statute of limitation commences from the date the injury is discovered.”

Walker v. Melton, 227 Ga. App. at 151. See, e.g., Ford v. Dove, 218 Ga. App. 828 (463 SE2d 351) (1995), overruled in part on other grounds, Ezor v. Thompson, 241 Ga. App. 275 (526 SE2d 609) (1999), aff’d, Thompson v. Ezor, 272 Ga. 849 (536 SE2d 749) (2000); Crawford v. Spencer, 217 Ga. App. 446, 447 (3) (457 SE2d 711) (1995); Knight v. Sturm, 212 Ga. App. 391 (1) (442 SE2d 255) (1994). The rule that the injury “occurs” when its symptoms manifest themselves to the patient applies even if the patient is not aware of either the cause of the pain or of the connection between the symptoms and the negligent act or omission. Henry v. Med. Center, 216 Ga. App. 893, 894 (2) (456 SE2d 216) (1995); Bryant v. Crider, 209 Ga. App. 623 (3) (434 SE2d 161) (1993); Jones v. Lamon, 206 Ga. App. at 846.

A harsh result can occur when the symptoms manifest themselves at or before misdiagnosis, but the patient is not aware until sometime later that the diagnosis was erroneous. That is the situation in this case in which the symptoms — pain and swelling in Williams’ leg — manifested themselves before Dr. Young made his diagnosis of lymph edema. The record is clear that the symptoms existed in September 1995, the date of Williams’ first visit to Dr. Young for foot discomfort. If we were to interpret the alleged malpractice as “occurring” when the symptoms manifested themselves to Williams, the statute of limitation would have expired before her complaint was filed on October 28, 1998. Similarly, if we use the first date of Dr. Young’s alleged misdiagnosis of Williams’ condition, again September 1995, as the date on which the statute began running, the statute of limitation expired before she filed suit.

Yet there is evidence that Williams continued under Dr. Young’s care until at least November 1996, when in a telephone conversation Dr. Young explicitly rejected Dr. Rhoads’ diagnosis of her foot. And there is expert evidence in the record that these telephone consultations were part of Dr. Young’s medical treatment of Williams.

Williams urges us to read the statute of limitation expansively by holding that the alleged negligence continues, for purposes of calculating the running of the statute, as long as the plaintiff remains in “continuous treatment.” Although in the past this court has declined to adopt this doctrine, see Ford v. Dove, 218 Ga. App. 828; Crawford v. Spencer, 217 Ga. App. at 449, we conclude that the better course is to adopt the doctrine in appropriate medical malpractice cases alleging misdiagnosis.

The continuing treatment doctrine provides:

If the treatment by the doctor is a continuing course and the patient’s illness, injury or condition is of such a nature as to impose on the doctor a duty of continuous treatment and care, the statute does not commence running until treatment by the doctor for the particular disease or condition involved has terminated — unless during treatment the patient learns or should learn of negligence, in which case the statute runs from the time of discovery, actual or constructive. Taylor v. Phillips, 801 SW2d 303, 304 (Ark. 1990) (quoting 1 D. Louisell and H. Williams, Medical Malpractice, § 13.08 (1982)). There are several bases for the rationale underlying this doctrine: (1) a patient should properly place trust and confidence in his physician and should be excused from challenging the quality of care being rendered to him until that confidential relationship terminates, Otto v. Nat. Institute of Health, 815 F2d 985, 988 (4th Cir. 1987); (2) to require a patient to bring suit against his physician before treatment is terminated would conceivably afford the physician a defense that the patient left before treatment was terminated and before the physician had a chance to effectuate a proper result, Taylor v. Phillips, 801 SW2d 303, 305 (Ark. 1990); and (3) the treating physician is in the best position to identify and correct the malpractice, Cooper v. Kaplan, 585 NE2d 373, 374 (NY 1991).

(Punctuation, footnote and emphasis omitted.) Vitner v. Miller, 208 Ga. App. 306, 308-309 (430 SE2d 671) (1993) (Pope, C. J., concurring specially).

Significantly, the doctrine comports with OCGA § 9-3-71 (a) not because it delays the occurrence of the injury but because it deems that the negligent act, i.e., the failure to make the proper diagnosis, continues as long as the patient remains under the physician’s care. The doctrine is applicable to misdiagnosis cases because each time the physician renders treatment to the patient based on an erroneous diagnosis, he is implicitly repeating the misdiagnosis.

We conclude that when malpractice is claimed to have occurred during a continuous and substantially uninterrupted course of examination and treatment in which a particular illness or condition should have been diagnosed in the exercise of reasonable care, the statute of limitation begins to run when the improper course of examination and treatment, if any, for the particular malady terminates. See Farley v. Goode, 219 Va. 969 (252 SE2d 594, 599) (1979). In reaching this conclusion we emphasize that although the adoption of the “continuous treatment” doctrine will alter our interpretation of the statute of limitation, the adoption of this doctrine does not affect the applicability of the statute of repose contained in OCGA § 9-3-71 (b).

There is considerable authority for the “continuous treatment” rule in other jurisdictions. See, e.g., Otto v. Nat. Institute of Health, 815 F2d 985 (Federal Tort Claims Act case); Taylor v. Phillips, 801 SW2d 303; Cooper v. Kaplan, 78 N.Y.2d 1103 (585 NE2d 373) (1991); Borgia v. City of New York, 12 N.Y.2d 151 (187 NE2d 777) (1962); Swift v. Colman, 608 NYS2d 717 (196 AD2d 150) (1994); Vinklarek v. Cane, 691 SW2d 108 (Tex. App. 1985); Caughell v. Group Health Coop. &c., 124 Wn.2d 217 (876 P2d 898) (1994); Metzger v. Kalke, 709 P2d 414 (Wyo. 1985). “Since 1940, there has been a steady trend toward judicial acceptance of the continuing treatment approach. [Cits.]” Lane v. Lane, 295 Ark. 671, 675 (752 SW2d 25) (1988) (lists 16 jurisdictions that had adopted the doctrine by 1988). And several of the courts which have declined to adopt the continuous treatment rule have done so on the basis that the specific wording of the applicable statute of limitation made application of the doctrine unnecessary. See, e.g., Hill v. Fitzgerald, 304 Md. 689, 699 (III) (501 A2d 27) (App. 1985) (common law continuous treatment doctrine did not survive adoption of the discovery rule in Maryland); Comstock v. Collier, 737 P2d 845, 849 (Colo. 1987) (continuous treatment doctrine does not apply when statute of limitation incorporates the discovery rule but does apply to statute of repose which begins to run on the date of the act or omission giving rise to the injury).

Nevertheless, we recognize that in adopting the continuous treatment doctrine, we must overrule those cases in which this court has specifically rejected this doctrine. Thus, to the extent that Ford v. Dove, 218 Ga. App. 828, and Crawford v. Spencer, 217 Ga. App. at 449 (3), conflict with this opinion, they are overruled. In most of the medical malpractice cases decided since the 1985 amendment to the statute, the continuous treatment doctrine was either inapplicable or was not raised by the parties. See, e.g., Oliver v. Sutton, 246 Ga. App. 436 (540 SE2d 645) (2000).

Using the continuous treatment doctrine, the record shows that Williams raised a jury issue as to whether her treatment by Dr. Young continued until October 28, 1996. There is evidence of a telephone conversation in November 1996, in which Dr. Young explicitly rejected Dr. Rhoads’ diagnosis and implicitly reiterated his diagnosis by advising her to continue treatment as he had recommended. Moreover, Dr. Young treated Williams for her diabetes during her December 1996 hospitalization.

Under the continuous treatment doctrine a plaintiff must show that (1) the doctor’s treatment is a continuing course and (2) that “the patient’s illness, injury or condition is of such a nature as to impose on the [physician] a duty of continuing] treatment and care.” (Punctuation omitted.) Vitner v. Miller, 208 Ga. App. at 308 (Pope, C. J., concurring specially). Here, there was a jury issue as to these elements. Moreover, given the circumstances of this case we cannot say as a matter of law that Williams knew or should have known of the alleged misdiagnosis, so as to render the continuous treatment doctrine inapplicable. Accordingly, the trial court erred in granting defendants’ motion for summary judgment.

Judgment reversed.

Johnson, C. J, Smith, P. J., Ruffin, Eldridge, Barnes, Miller, Ellington and Mikell, JJ, concur. Andrews, P. J., and Blackburn, P. J., dissent. Phipps, J., not participating.

Andrews, Presiding Judge,

dissenting.

I respectfully dissent.

As the majority points out, the law is well settled in Georgia that “[i]n most misdiagnosis cases, the injury begins immediately upon the misdiagnosis due to the pain, suffering or economic loss sustained by the patient from the time of the misdiagnosis until the medical problem is properly diagnosed and treated. [Cit.] The misdiagnosis itself is the injury and not the subsequent discovery of the proper diagnosis.” Whitaker v. Zirkle, 188 Ga. App. 706, 707 (374 SE2d 106) (1988), cert. denied, 188 Ga. App. 913. See also OCGA § 9-3-71 (a); Charter Peachford Behavioral Health System v. Kohout, 233 Ga. App. 452, 455 (504 SE2d 514) (1998); Ford v. Dove, 218 Ga. App. 828, 831 (3) (463 SE2d 351) (1995); Henry v. Med. Center, 216 Ga. App. 893, 894 (2) (456 SE2d 216) (1995); Crawford v. Spencer, 217 Ga. App. 446, 448 (3) (457 SE2d 711) (1995); Frankel v. Clark, 213 Ga. App. 222, 223 (444 SE2d 147) (1994); Bryant v. Crider, 209 Ga. App. 623, 626 (3) (434 SE2d 161) (1993). The fact that the plaintiff did not know the medical cause of her suffering does not affect the running of the statute of limitation under OCGA § 9-3-71 (a) where the injury has occurred and physically manifested itself to her. Henry v. Med. Center, 216 Ga. App. at 894; Frankel v. Clark, 213 Ga. App. at 223. It is apparent from the law stated above that in order to make the change advocated by the majority opinion, the majority is overruling a long line of cases, not just the two named in the opinion.

Most importantly, the Supreme Court of Georgia has clearly held that the plain language of OCGA § 9-3-71 does not permit the interpretation advanced by the majority. In Crowe v. Humana, Inc., 263 Ga. 833, 834 (439 SE2d 654) (1994), the court held:

The Crowes, however, ask us to hold that the cause of action “arose,” and thus the period of limitation commenced, when they discovered that the appellees’ negligence caused Ashley’s injuries. We find that initiating the period of limitation in a medical malpractice action when the alleged negli gence is first discovered would be contrary to the plain language of §§ 9-3-71 and 9-3-73.

(Footnote omitted; emphasis supplied.)

The Supreme Court reaffirmed this holding and cited to Ford v. Dove and Crawford v. Spencer as authority in Hunter, Maclean &c., PC. v. Frame, 269 Ga. 844, 849 (507 SE2d 411) (1998). In that case, the court held that the statute of limitation was not tolled in legal malpractice actions simply because the attorneys continued to represent the plaintiff. “That result would essentially be an adoption of the ‘continuing representation rule,’ which has been consistently rejected by Georgia courts in the malpractice context, [citing to Ford v. Dove and Crawford v. Spencer,] and which we expressly decline to adopt in this case.” Id. at 849. Thus, the Supreme Court has expressly rejected the continuing treatment rationale advanced by the majority. This Court is bound by the decisions of the Supreme Court. 1983 Ga. Const., Art. VI, Sec. VI, Par. VI; Dester v. Dester, 240 Ga. App. 711, 712 (523 SE2d 635) (1999).

Finally, even if the Supreme Court had not already spoken, the majority opinion overrules a long line of cases interpreting OCGA § 9-3-71 (a).

The application of the doctrine of stare decisis is essential to the performance of a well-ordered system of jurisprudence. In most instances, it is of more practical utility to have the law settled and to let it remain so, than to open it up to new constructions, as the personnel of the court may change, even though grave doubt may arise as to the correctness of the interpretation originally given to it.

Etkind v. Suarez, 271 Ga. 352, 357 (519 SE2d 210) (1999).

Even those who regard stare decisis with something less than enthusiasm recognize that the principle has even greater weight where the precedent relates to interpretation of a statute. A reinterpretation of a statute after the General Assembly’s implicit acceptance of the original interpretation would constitute a judicial usurpation of the legislative function.

(Citations and punctuation omitted.) Id. at 358.

Although the majority claims there are important public policy reasons for changing our interpretation of this statute, the legislature has not seen fit to do so, and any attempt on our part to make this change goes beyond the limits of judicial restraint and into the area of unauthorized judicial legislation. Clabough v. Rachwal, 176 Ga. App. 212, 215 (335 SE2d 648) (1985).

Decided December 1, 2000

Reconsideration denied December 14, 2000

Greer, Klosik, Daugherty & Swank, Frank J. Klosik, Jr., Robert J. McCune, Jason R. Mantón, for appellant.

Watson, Spence, Lowe & Chambless, Thomas S. Chambless, Dawn G. Benson, Charles K. Wainright II, for appellees.

I am authorized to state that Presiding Judge Blackburn joins in this dissent.

       Williams’ motion to dismiss the appeal is denied.

       But see Whitaker v. Zirkle, 188 Ga. App. at 708 (“When an injury occurs subsequent to the date of medical treatment, the statute of limitation commences from the date the injury is discovered.”). Whitaker has been limited to cases in which the patient discovers the symptoms, but not the cause, subsequent to the treatment. See Jones v. Lamon, 206 Ga. App. at 846; Walker v. Melton, 227 Ga. App. at 150; Staples v. Bhatti;220 Ga. App. 404.

       Decisions rejecting a “discovery” rule to govern the statute are not relevant to the “continuous treatment” theory. Plaintiffs who invoke the “continuous treatment” doctrine are attempting to postpone the negligent act rather than postponing the discovery of the injury.

       The “continuous treatment” doctrine differs from the “continuous tort” doctrine. Compare Abend v. Klaudt, 243 Ga. App. 271 (531 SE2d 722) (2000).

       As noted above, Ford was overruled in part on other grounds in Ezor v. Thompson, 241 Ga. App. 275.


text:
    A00A1460.
    RICHARDS v. THE STATE.
    (542 SE2d 622)
   Ruffin, Judge.

Alan Gerald Richards, Sr. was convicted of two counts of second degree vehicular homicide. On appeal, Richards challenges the sufficiency of the evidence, and he contends that he was denied effective assistance of counsel, and that the court erred in denying his motion for a directed verdict of acquittal. For reasons that follow, we affirm.

1. Following his conviction, Richards filed a timely motion for new trial. More than 30 days after the date of the judgment, he voluntarily withdrew his motion for new trial and filed this appeal. Under OCGA § 5-6-38 (a), an appeal ordinarily must be filed within 30 days of the judgment, and failure to do so divests this Court of jurisdiction. Accordingly, we must first address whether this Court has jurisdiction to entertain this appeal. In so doing, we are confronted with two lines of authority interpreting OCGA § 5-6-38 (a). Under that Code section,

[a] notice of appeal shall be filed within 30 days after entry of the appealable decision or judgment complained of; but when a motion for new trial . . . has been filed, the notice shall be filed within 30 days after the entry of the order granting, overruling, or otherwise finally disposing of the motion.

Although the express language of the Code section appears to require the entry of a court order to “dispose” of the motion, in Golden v. Credico, Inc., this Court concluded that “[a] motion for new trial can be disposed of in four ways: (1) overruled, (2) granted, (3) dismissed, or (4) withdrawn by movant.” This rationale was also followed in Heard v. State and Booker v. Amdur.

In Taylor v. State, however, OCGA § 5-6-38 was interpreted to require court action to dispose of a motion for new trial. Because Taylor had withdrawn his motion for new trial, this Court concluded that it lacked jurisdiction to entertain the appeal. This reasoning was followed in both Hall v. State and Marshall v. State.

This issue evidently was raised before the Supreme Court in Johnson v. State. Although the majority did not expressly address the issue, the dissent asserted that the Court was without jurisdiction to entertain the appeal because the trial court never entered any order on the defendant’s motion for new trial. However, by addressing the appeal on its merits, the majority necessarily concluded that it had jurisdiction, implicitly ruling that a withdrawal “disposes” of a motion for purposes of filing a notice of appeal. Accordingly, we are compelled to conclude that a withdrawal of a motion for new trial constitutes a “disposal” of the motion under OCGA § 5-6-38 (a). To the extent that cases such as Hall, Marshall, and Taylor hold otherwise, they are hereby overruled.

2. In his first enumeration of error, Richards challenges the sufficiency of the evidence. On appeal from a criminal conviction, the evidence must be construed in the light most favorable to the verdict. Moreover, as the reviewing court, we do not weigh the evidence or decide witness credibility, but only determine the sufficiency of the evidence under the standard of Jackson v. Virginia. As long as there is some competent evidence, even though contradicted, to support each fact essential to the State’s case, the jury’s verdict will be upheld.

So viewed, the evidence established that, following a basketball game, Richards drove seven children in his Isuzu Rodeo. None of the children was wearing a seat belt. As Richards was traveling southbound on Tara Boulevard, he entered the intersection at Tara and State Road 54. While crossing the intersection, Richards hit a pickup truck and lost control of the Rodeo. The Rodeo slid sideways, then rolled over several times. All of the children were ejected from the Rodeo, and two 13-year-old boys were killed.

Michael McKinney, a passenger in the Ford pickup truck, testified that the truck had been at a complete stop for at least a minute before the light changed from red to green. As the truck pulled into the intersection, it was suddenly struck on the front right side by the Rodeo. According to McKinney, “[h]e ran the red light. I believe that he was not paying attention to the light because he had seven boys in the car.” McKinney estimated that Richards was going 60 mph, which he described as “too fast.”

Although Jessie Jackson, the driver of the Ford pickup truck, died before trial, his testimony was read into evidence. According to Jackson, when the light turned green, he pulled into the intersection, and his truck was hit by a vehicle that “just came through there just like a flash,” going “at a high rate of speed.” Jackson testified that he had never seen “[any]one run a red light like that before.”

Another driver, Brian Whitlock, was stopped in the lane immediately next to Jackson’s truck. When the light turned green, Whitlock started forward, but managed to stop after spotting the oncoming Rodeo out of the corner of his eye. Whitlock testified that Jackson’s truck was no more than two feet ahead of his car after he braked. Whitlock’s wife, a passenger in the car, also testified that the light was green when Whitlock proceeded into the intersection.

Gary Moore, whose car was two cars behind Jackson’s truck, also testified that the light had turned green. According to Moore, he saw the Rodeo for a split second before it struck a “glancing blow” to the pickup truck. In a written statement, Moore described the events as follows:

I was at the intersection of Hwy 19/41 and Hwy 54 (going east on Hwy 54) waiting for the light to change. When the light eventually did change and traffic began to move a white pickup three cars ahead of my car was struck by a blue/green SUV that ran the red light.

Neal Spradlin, the Clayton County Traffic Engineer, testified that county traffic engineers had set the traffic control device at the intersection of SR 54 and Tara Boulevard so that the yellow caution light lasted for 4.7 seconds followed by an all red in every direction for 1.3 seconds. Spradlin further testified that, if the light for SR 54 was green, the light on Tara Boulevard would not have been green. Finally, Spradlin testified that there was no indication that the traffic light had malfunctioned on the day of the collision.

Richards was convicted of two counts of vehicular homicide based on his failure to come to a complete stop at a red light. On appeal, Richards contends that the evidence was insufficient to establish that he ran a red light. We disagree. Five witnesses testified that the light had changed to green for vehicles traveling in the direction of the Ford pickup. Based on this evidence as well as Spradlin’s testimony that the light had not malfunctioned, a rational trier of fact could have concluded that Richards failed to stop at the red light, and that this failure caused the accident and the deaths of the two children.

3. In a separate enumeration of error, Richards asserts that there was no direct evidence that he ran the red light and that such evidence is required to sustain a conviction. Again we disagree.

Richards, who was traveling southbound, testified that the light in his direction was either green or yellow, but not red. No other witness who was traveling southbound was able to testify unequivocally as to the color of the southbound light. The five witnesses who testified that Richards ran the red light were traveling eastbound. Thus, they based their conclusion that Richards ran a red light on the fact that their light was green. According to Richards, “the testimony of these . . . witnesses, at best, only provided circumstantial evidence to suggest that the light was red for [him].”

The fact that “evidence may be ‘circumstantial’ makes it no less powerful when the circumstances proved lead directly to [a] conclusion.” Again, five witnesses testified that Richards ran the red light. The fact that their testimony was based on their observation of the traffic signal for eastbound travelers makes it no less compelling. Such testimony certainly was sufficient to support the jury’s verdict.

Lyons v. State, the case cited by Richards, does not require a different result. In Lyons, two motorists collided in an intersection. The only evidence that Lyons ran a red light consisted of one witness who “admitted not seeing Lyons’ car until after the accident and never testified he saw the light turn red.” Nevertheless, that witness testified that both Lyons and the other motorist ran the red light. Under those facts, this Court concluded that there was no competent evidence that Lyons had run a red light. That is not the case here, however, where five witnesses testified that the light in the opposite direction had turned green before Richards drove into the intersection. Thus, Richards’ assertion lacks merit.

4. In a motion for new trial filed by Richards’ appellate counsel, Richards asserted that he was prejudiced by the ineffective assistance of his trial counsel. Before the trial court ruled, however, Richards withdrew his motion for new trial and filed this appeal.

Decided November 21, 2000

Reconsideration dismissed December 14, 2000.

Derek M. Wright, Alan M. Shenberg, Shaun C. Willie, for appellant.

Keith C. Martin, Solicitor, for appellee.

“An ineffectiveness [of counsel] claim must be asserted at the earliest practicable moment and before appeal when the opportunity to raise such claim is available.” If a defendant fails to do so, he waives the issue on appeal. Here, Richards had new counsel prior to filing his motion for new trial. Thus, he had an opportunity to present his ineffectiveness claim to the trial court prior to this appeal. It follows that Richards is now procedurally barred from raising the issue for the first time on appeal.

5. Finally, Richards contends that the trial court erred in denying his motion for a directed verdict of acquittal. For the reasons set forth in Division 2, however, Richards’ contention lacks merit.

Judgment affirmed.

Johnson, C. J., Pope, P. J, Andrews, P. J., Blackburn, P. J., Smith, P. J., Eldridge, Barnes, Miller, Ellington, Phipps and Mikell, JJ, concur.

        Grant v. State, 157 Ga. App. 390 (278 SE2d 53) (1981).

       124 Ga. App. 700, 701 (185 SE2d 578) (1971).

       210 Ga. App. 805-806 (1) (437 SE2d 496) (1993).

       186 Ga. App. 276 (367 SE2d 94) (1988).

       173 Ga. App. 745 (327 SE2d 860) (1985).

       213 Ga. App. 242 (445 SE2d 578) (1994).

       205 Ga. App. 531 (422 SE2d 677) (1992).

       263 Ga. 395 (435 SE2d 195) (1993).

       Id. at 396.

        Taylor v. State, 235 Ga. App. 323, 324 (1) (509 SE2d 388) (1998).

       443 U. S. 307 (99 SC 2781, 61 LE2d 560) (1979).

        Kenyada v. State, 239 Ga. App. 438, 439 (521 SE2d 408) (1999).

        McKinney v. State, 213 Ga. App. 498, 500 (2) (445 SE2d 550) (1994).

        Green v. State, 244 Ga. App. 565, 566 (1) (536 SE2d 240) (2000).

       208 Ga. App. 632 (431 SE2d 432) (1993).

       Id.

        Grimes v. State, 245 Ga. App. 277, 279 (3) (537 SE2d 720) (2000).

       Id.

       See Howard v. State, 233 Ga. App. 724, 729-730 (7) (505 SE2d 768) (1998).

       See Cottingham v. State, 206 Ga. App. 197 (1) (424 SE2d 794) (1992) (standard for reviewing denial of directed verdict of acquittal is same as for reviewing sufficiency of evidence).


text:
    A00A1654, A00A1655.
    TOAL et al. v. DEKALB MEDICAL CENTER, INC. et al.; and vice versa.
    (542 SE2d 184)
   Ruffin, Judge.

DeKalb Medical Center and various other hospitals sued the Georgia Department of Medical Assistance (DMA), claiming, among other things, that DMA’s Medicaid reimbursements to the hospitals breached the terms of their respective provider agreements. The trial court granted summary judgment to the hospitals on certain issues and to DMA on others. Both sides appeal aspects of the trial court’s ruling.

Medicaid is a federal-state program under which the federal government provides financial assistance to states to enable them to provide medical care to needy individuals. To qualify for federal assistance, a state must formulate a plan and submit it for approval to the federal Health Care Financing Agency (HCFA), an agency of the Department of Health & Human Services (HHS). Among other things, the plan must contain a scheme for reimbursing health care providers who provide services to Medicaid patients. During the time period relevant in this case, a provision of the Medicaid Act known as the Boren Amendment required that state plans must provide for hospitals to be reimbursed at rates “which the State finds, and makes assurances satisfactory to the Secretary [of HHS], are reasonable and adequate to meet the costs which must be incurred by efficiently and economically operated facilities.” The Boren Amendment has both a procedural and a substantive component — i.e., the State must make the requisite findings and assurances, and must also adopt rates that are in fact reasonable and adequate.

DMA is the state agency that administers the Medicaid program in Georgia, and it enters into “provider agreements” with various hospitals that render services to Medicaid patients. Up until August 1996, DMA would reimburse hospitals for Medicaid patients treated on a “per case” basis — i.e., it would pay hospitals a certain amount per Medicaid patient admitted, regardless of the treatment provided or length of stay. This “per case rate” differed for each hospital, and was calculated by taking the hospital’s total audited Medicaid costs in a base year (typically three years before the reimbursement year), adjusting these costs for inflation to predict Medicaid costs in the reimbursement year, and dividing the resulting amount by the number of Medicaid admissions in the base year. This methodology was developed in part to encourage cost efficiency, since hospitals that reduced their costs during a particular year could keep the difference between their actual costs and the costs reflected in the per case rate. Cost efficiencies would also act in the State’s interest, since an efficient hospital’s reduced costs would serve as the basis for setting its future per case rates. During 1992 and 1993, and presumably in other years, certain institutions (including the plaintiffs in this case) thus received reimbursements from DMA that exceeded their actual Medicaid costs.

Effective August 15, 1996, the DMA adopted an amended reimbursement plan that sought to recoup the “excess” reimbursements garnered by some hospitals in 1992 and 1993. This amended plan retained the same basic structure as the prior plan, providing that per case rates would be based on hospitals’ audited costs in 1993, adjusted for inflation. With respect to those hospitals that had garnered “excess” Medicaid reimbursements in 1992 and 1993, however, the plan provided that “[p] respective per case rates will be adjusted to deduct an amount per case for 90% of the average amount that Medicaid payments exceeded the cost of services provided during fiscal years 1992 and 1993.” Thus, these hospitals would suffer two consequences: (1) their base per case rates would be reduced to reflect the fact that their actual costs per patient in 1993 were lower than anticipated, and (2) their per case rates would be further reduced due to the “excess” payments they had received in 1992 and 1993. The resulting per case rates for these hospitals would thus be less than the actual cost per patient incurred in 1993, adjusted for inflation.

In response to HCFA’s requests for clarification, DMA provided written assurances that the aggregate payments to hospitals under the amended plan would “meet the costs that must be incurred by efficiently and economically operated hospitals.” DMA subsequently informed HCFA that it estimated that 125 hospitals would receive payments greater than their actual costs, while 38 hospitals would receive payments less than their actual costs. HCFA approved the plan in a May 28, 1997 letter, which referenced DMA’s written responses and also stated that DMA had

in a subsequent telephone call indicated that all efficiently and economically operated facilities are expected to be paid 100 percent of allowable costs. . . . Based on this additional clarification, the State’s assurances and related rate information, we have approved [the amended plan].

The plaintiffs sued the DMA, alleging, among other things, that the 1996 plan violated the terms of their 1997 provider agreements. They note that the provider agreements require DMA to reimburse the hospitals “for such claims, and in such amounts, as meet the provisions of the Georgia State Plan for Medical Assistance and attachments thereto [and] applicable federal and state law.” They assert that the reference to “applicable federal law” requires compliance with the Boren Amendment. According to the hospitals, the 1996 plan violated the Boren Amendment both procedurally and substantively, because (1) the state did not make the requisite “findings” or “assurances” that the rates were adequate to meet the costs incurred by an efficient hospital, and (2) the rates were not in fact sufficient to cover such costs. The hospitals also claim that the recoupment of past profits constituted an unconstitutional taking of private property.

The trial court granted partial summary judgment to the hospitals, holding that the 1996 plan amendment violated the Boren Amendment both substantively and procedurally. The court did not, however, address whether such violations constituted a breach of the hospitals’ provider agreements, nor did it purport to grant summary judgment on the hospitals’ claim for breach of contract. The court did state in one sentence that “[t]he remedy for the violation is reimbursement of all actual allowable costs from August 15, 1996, through October, 1997,” but it did not purport to grant summary judgment as to damages. Indeed, the court expressly stated that it denied all aspects of the hospitals’ summary judgment motion except to the extent that it found a violation of the Boren Amendment. The court granted summary judgment to DMA on all other issues, including the “takings” claim.

On appeal, DMA contends that the 1996 plan did not violate the Boren Amendment, and that, even if it did, the trial court erred in fashioning a remedy. In their cross-appeal, the hospitals also contend that the trial court’s remedy was improper. In addition, they claim that the trial court erred in granting summary judgment to DMA on their takings claim.

1. Violation of Boren Amendment. DMA does not deny that the Boren Amendment was incorporated into the provider agreement, or that failure to comply with the Boren Amendment would constitute a breach thereof. Rather, it simply claims that the trial court erred in finding that it violated the Boren Amendment in adopting the 1996 plan. We disagree.

Procedurally, the Boren Amendment requires a state to “engage in a ‘finding’ process that all federal requirements have been met,” and to provide “assurances” to the HCFA that such requirements have been met. A reimbursement plan adopted in violation of the Boren Amendment’s procedural requirements is invalid regardless of whether the plan substantively complies with the statute.*

In discussing the statute’s procedural requirements, the U. S. Supreme Court has held that

the statute requires the State, in making its findings, to judge the reasonableness of its rates against the objective benchmark of an “efficiently and economically operated facility” providing care in compliance with federal and state standards while at the same time ensuring “reasonable access” to eligible participants.

The Tenth Circuit has interpreted this procedural component as meaning that a state must

at a minimum, . . . make “findings” which identify and determine (1) efficiently and economically operated hospitals; (2) the costs that must be incurred by such hospitals; and, (3) payment rates which are reasonable and adequate to meet the reasonable costs of the state’s efficiently and economically operated hospitals.

The Seventh Circuit, while rejecting the notion that a state must “identify a reasonable sample of particular existing [health care providers] as paradigms of efficiency,” nevertheless recognizes that a state must determine “what it would consider to be efficient and economic . . . facilities and must make findings which establish a nexus between the costs of operating those facilities and the proposed reimbursement rates under the state plan.” The Alaska Supreme Court has stated that

the findings requirement of Boren is designed to ensure that rates are not set arbitrarily, i.e., without proper consideration of the costs of operating a facility in the state. Therefore, we conclude that states must make concrete findings, based on studies of existing facilities, and use these studies to establish, with reference to either existing or hypothetical facilities, an “objective benchmark of an ‘efficiently and economically operated facility.’ ”

In reviewing the various approaches, the Fifth Circuit has noted that

the findings requirement is not a mere formality that can be satisfied simply by having a state officer think a bit about hospital costs and then copy out the statutory language on a piece of paper, put the heading “assurances” on that piece of paper, and send it to HCFA. ... As part of the factfinding process, the state agency must “judge the reasonableness of its rates against the objective benchmark of an ‘efficiently and economically operated facility’ providing care in compliance with federal and state standards while at the same time ensuring ‘reasonable access’ to eligible participants.”

In this case, it is undisputed that DMA did not conduct any factfinding process in an attempt to identify efficiently and economically operated facilities. Rather, DMA claims that it assumed all Medicaid providers in the state were efficiently and economically operated. It contends that this assumption validly discharged its duty to make findings regarding the costs that must be incurred by efficiently and economically operated facilities.

DMA’s approach has been rejected by at least two courts. In Abbeville Gen. Hosp. v. Ramsey, the Fifth Circuit held that Louisiana’s Medicaid reimbursement scheme violated the procedural component of the Boren Amendment. The Louisiana Department of Health & Hospitals (LDHH) reimbursed 100 percent of hospitals’ capital costs, educational expenses, and malpractice expenses. All other operating costs were reimbursed either on a 100 percent basis or at a maximum level determined by the hospital’s “target rate.” The target rate was initially set based on the higher of the hospital’s 1980 and 1981 average costs per Medicaid patient, as periodically increased for inflation. Various hospitals challenged the reimbursement scheme, claiming that LDHH failed to procedurally comply with the Boren Amendment. LDHH admitted that it

conducted no studies and made no efforts to determine which state hospitals are efficiently and economically run. Instead, LDHH functioned under the premise that every hospital was economically and efficiently operated in 1981 and used the available cost reports for that base year to calculate the target rates for each hospital.

The Fifth Circuit held that the method by which LDHH calculated the target rates violated the Boren Amendment:

Findings were not made, instead assumptions were made. It is circular for LDHH to set target rates under the assumption that all hospitals are efficiently and economically operated and then identify efficiently and economically operated facilities as those whose costs fall below their own reimbursement rate. . . . LDHH has reduced its findings process to a simple exercise of compilation and assumption, completely ignoring the Congressional mandate that state agencies consider relevant factors such as efficiency, economy, quality of care, and reasonable access. LDHH emphasizes that it has received relatively few complaints regarding hospital quality of care. This fact, however, says nothing about the reasonableness or adequacy of rates to meet the needs of efficiently and economically operated hospitals where rates initially set assume that every hospital is efficient and economic.

The Court stated that it “cannot endorse such a pro forma compliance with the findings requirement of the Boren Amendment,” and held that the hospitals were therefore entitled to summary judgment on the issue of procedural compliance.

The Alaska Supreme Court considered a similar reimbursement scheme in Dept. of Health &c. Svcs. v. Alaska State Hosp. &c. In that case, the Alaska Medicaid agency did not attempt to identify efficiently operated facilities, but simply assumed that all state facilities were efficiently operated in a base year. The state then adjusted the base year costs for each hospital by an inflation figure, and set reimbursement rates based on the weighted average cost of facilities in the same class. The Alaska Supreme Court held that this approach violated the Boren Amendment, stating that

an assumption [that facilities operated efficiently in a base year] may ease the State’s rate-setting work by readily providing a point of comparison, but it cannot satisfy the requirement that the states “find” rates that must be incurred by efficiently and economically operated facilities. . . . While the choice of certain base year rates may represent the costs that must be incurred by an efficient and economical facility, the State has made no findings that this is SO.

The reimbursement plan in this case suffers from the same defects as those in Abbeville and Alaska State Hosp. DMA did not conduct any factfinding investigation to determine the costs that would be incurred by an efficiently and economically operated hospital. Instead, it claims that it presumed that all hospitals in the state were efficiently operated, and then established each hospital’s per case rate based upon the hospital’s actual cost per patient in 1993, several years earlier. It then estimated that, in the aggregate, the anticipated reimbursements to Medicaid providers under the amended plan would be sufficient to cover the aggregate costs incurred by efficiently and economically operated facilities, even though many hospitals would receive reimbursements less than their actual costs.

Even if an assumption could take the place of a finding, however, DMA’s methodology suffers from an additional, and more fimdamental, flaw, in that its proposed reimbursement scheme is inconsistent with its underlying assumption. If, as DMA asserts, all hospitals are efficiently and economically operated, then the costs actually incurred by such hospitals are, by definition, “the costs which must be incurred by efficiently and economically operated facilities.” To be in compliance with the Boren Amendment, therefore, any plan must be calculated to reimburse, in the aggregate, 100 percent of the actual Medicaid costs incurred by all hospitals in the state.

As discussed above, DMA arrived at its per case rates through a three-step process. First, it determined the total Medicaid costs incurred by each hospital in a base year. It then used an “inflation trend factor” to predict total Medicaid costs in the current year. Finally, it divided the resulting amount by the number of Medicaid admissions in the base year to arrive at the per case rate, or the expected cost per Medicaid patient. If we accept the fundamental premise DMA claims underlies its reimbursement methodology — i.e., that every hospital in the state is efficiently and economically operated — this figure represents the minimum amount that must be paid to health care providers to comply with the Boren Amendment. However, DMA’s 1996 plan only pays this rate to some hospitals, while paying a lower rate to others. Thus, if every hospital is indeed efficiently and economically operated, the anticipated reimbursements under the plan would be insufficient, in the aggregate, to cover the anticipated costs incurred by such hospitals in providing Medicaid treatment

If, instead of making findings as to the costs incurred by an efficiently and economically operated facility, DMA wishes to rely on an assumption regarding such costs, it must at least establish reimbursement rates consistent with that assumption. In other words, it must establish “a nexus between the costs of operating those facilities and the proposed reimbursement rates.” Far from establishing a nexus, however, DMA instead adopted a reimbursement scheme that contradicts the very assumption on which it is allegedly based. It is thus apparent that DMA failed to make the findings necessary to justify the 1996 plan, and the trial court properly held that DMA procedurally violated the Boren Amendment in adopting the plan. Because failure to comply with the Boren Amendment’s procedural requirements renders a state’s Medicaid plan invalid, it is not necessary to consider whether the plan substantively complied with the Boren Amendment.

2. Remedy. In its summary judgment order, the trial court stated that “[t]he remedy for the violation is reimbursement of all actual allowable costs from August 15, 1996, through October, 1997,” although it did not enter a dollar judgment in favor of the hospitals, and indeed did not even discuss whether violation of the Boren Amendment would constitute a breach of the provider agreements. Both parties assert that the remedy described by the trial court is improper, although they disagree as to the proper approach. DMA argues that, if the 1996 plan was adopted in violation of the Boren Amendment, the appropriate remedy would be to order it to adopt a new reimbursement methodology consistent with the Boren Amendment’s requirements. The hospitals, by contrast, argue that DMA should be required to make reimbursements in accordance with the previous plan.

Initially, we note that the trial court’s statement as to the appropriate remedy appears to be mere dicta, and not part of the judgment. The hospitals moved for summary judgment only on the issue of breach, not on the issue of damages. The trial court’s statement regarding the appropriate remedy was made in the context of analyzing DMA’s compliance with the Boren Amendment. In actually rendering its judgment, however, the court stated that it granted the hospitals’ motion for summary judgment only “to the extent that the Court finds Defendants procedurally and substantively violated the Boren Amendment to the Medicaid Act by failing to provide reimbursements that met actual allowable costs,” and that it denied the motion in all other respects. Although the court clearly indicated what it believed to be the proper remedy for a violation of the Boren Amendment, it did not hold that the violation constituted a breach of the provider agreement, which was the theory of liability asserted by the hospitals, and did not enter any judgment as to damages. Nevertheless, even if the trial court’s statement is properly classified as dicta, we believe it is appropriate to address this issue in order to provide clarity on remand.

Several courts in other jurisdictions have considered this issue and have concluded that, if an amended plan is invalid for failure to comply with the Boren Amendment, the previously existing plan remains in effect until such time as a new plan is properly adopted. We believe this approach is the correct one, and is particularly apt where the plaintiffs are suing for breach of a contractual provision requiring reimbursements to be made in compliance with the Boren Amendment. Accordingly, the trial court’s order is vacated to the extent that it purports to describe the appropriate remedy for a violation of the Boren Amendment. While DMA’s proposed remedy — i.e., requiring it to establish a new reimbursement scheme that complies with the Boren Amendment — would be proper in a case involving prospective relief, it makes little sense in a case challenging reimbursements made years ago under a methodology that has since changed. Indeed, since DMA currently has a valid reimbursement scheme in place, it would be awkward, if not impossible, to require it to adopt a new reimbursement scheme that would comply with the repealed Boren Amendment while applying only to claims made by the plaintiff hospitals between August 1996 and October 1997, and then somehow obtain HCFA approval for such a retroactive plan.

3. Takings claim. The hospitals contend that the trial court erred in granting summary judgment on their “takings” claim, which asserted that the recoupment of their 1992 and 1993 profits violated the constitutional prohibition against taking private property without just compensation. This contention is without merit. The 1996 plan did not “take” the hospitals’ prior profits, but simply took the size of those profits into consideration in setting the reimbursement rates for services provided after August 15,1996. Although this reimbursement methodology may have violated the Boren Amendment, it in no sense constituted a “taking,” constitutional or otherwise, of specific money in which the hospitals had a property interest. Accordingly, the trial court did not err in granting summary judgment to DMA on this claim.

Decided November 13, 2000

Reconsideration denied December 14, 2000

Thurbert E. Baker, Attorney General, Dennis R. Dunn, Deputy Attorney General, William C. Joy, Senior Assistant Attorney General, Per B. Normark, Assistant Attorney General, for appellants.

Powell, Goldstein, Frazer & Murphy, James C. Rawls, V. Robert Denham, Jr., Sara K. Wheeler, Holly A. Pierson, for appellees.

4. Conclusion. For the reasons discussed above, the trial court correctly held that DMA procedurally violated the Boren Amendment in adopting the 1996 plan. The court’s order is vacated, however, to the extent that it purports to describe the proper measure of recovery for a violation of the Boren Amendment. The trial court properly granted summary judgment to DMA on the hospitals’ takings claim. We remand the case to the trial court for further action consistent with this opinion.

Judgments affirmed in part and vacated in part and case remanded.

Andrews, P. J., and Ellington, J., concur.

       After the filing of this lawsuit, a new department, the Department of Community Health, was created to consolidate various state agencies. DMA is now a division of the Department of Community Health, and is known as the Division of Medical Assistance.

       See Wilder v. Virginia Hosp. Assn., 496 U. S. 498, 502 (110 SC 2510, 110 LE2d 455) (1990).

       See AMISUB (PSL), Inc. v. Colorado Dept. of Social Svcs., 879 F2d 789, 794 (10th Cir. 1989).

       See Wilder, supra.

       42 USC § 1396a (a) (13) (A). See Wilder, supra at 502-503. This provision was repealed on August 5,1997, although it was in effect at all relevant times in this case.

       See Wilder, supra at 510; Americare Properties v. Whiteman, 257 Kan. 30, 38-39 (891 P2d 336) (1995).

       The hospitals had previously filed an action in federal court under 42 USC § 1983, seeking declaratory and injunctive relief. Effective October 9, 1997, however, DMA abandoned the disputed reimbursement methodology and adopted a completely different reimbursement scheme. The federal court then dismissed the hospitals’ complaint without prejudice on mootness grounds.

       DMA does assert that, because the Boren Amendment was incorporated into the contract only by reference to “applicable federal law,” it is entitled to sovereign immunity. DMA claims that, because the Georgia Constitution waives immunity only for written contracts, and the Boren Amendment is not expressly included in the written contract, there is no waiver of sovereign immunity. See Ga. Const., Art. I, Sec. II, Par. IX (c). This contention is without merit. DMA cites no cases holding that a written contract may not incorporate matters by reference. The fact that the provider agreement requires reimbursement in compliance with the Boren Amendment does not render it any the less a written contract.

       The Supreme Court has held that “health care providers are the intended beneficiaries of the Boren Amendment,” and that the amendment “creates a right enforceable by health care providers under [42 USC] § 1983.” Wilder, supra at 509-510. We have found no cases specifically holding that compliance with the Boren Amendment may be enforced in a breach of contract action. To the extent that the amendment creates an enforceable right, and to the extent that compliance with the amendment is made a condition of a contract between the state and a health care provider, we see no reason why the provider may not enforce its rights through an action on the contract as opposed to a § 1983 action.

        AMISUB, supra at 796.

       See Dept. of Health &c. Svcs. v. Alaska State Hosp. &c., 856 P2d 755, 764-765 (Alaska 1993); Pinnacle Nursing Home v. Axelrod, 928 F2d 1306, 1316-1317 (2nd Cir. 1991); Americare Properties, supra at 47.

        Wilder, supra at 519.

       (Emphasis in original.) AMISUB, supra. See also Pinnacle Nursing Home, supra at 1314 (favorably citing AMISUB’s three-part test).

       (Punctuation omitted.) Illinois Health Care Assn. v. Bradley, 983 F2d 1460, 1464-1465 (7th Cir. 1993). See also Pinnacle Nursing Home, supra.

        Alaska State Hosp., supra at 763, quoting Wilder, supra at 519.

        Abbeville Gen. Hosp. v. Ramsey, 3 F3d 797, 805-806 (5th Cir. 1993), quoting Wilder, supra at 519.

       Supra.

       Id. at 800.

       Id. at 806.

       Id. at 808.

       Id. at 810.

       Supra.

       Id. at 763.

       Id.

       DMA asserts that each efficiently operated hospital need not be reimbursed in an amount sufficient to cover its costs, but that it is enough that aggregate reimbursements to all hospitals are sufficient to cover the aggregate costs incurred by efficient hospitals. Consistent with DMA’s position, some courts have held that “the issue [is] not whether the state’s reimbursement rates [are] adequate as to a single provider, but rather whether the rates [are] adequate in the aggregate.” Drake Center v. Dept. of Human Svcs., 125 Ohio App.3d 678, 691-692 (709 NE2d 532) (1998). See also West Virginia Univ. Hosp. v. Casey, 885 F2d 11, 26 (3rd Cir. 1989) (“What matters ... is whether the reimbursement rates ... in the aggregate are arbitrary and capricious.”). We question, however, whether a reimbursement methodology that singles out a group of admittedly efficient hospitals, providing that they will be reimbursed under a different formula than all other hospitals — a formula calculated to produce reimbursement rates lower than the hospitals’ expected cost per patient — complies with the Boren Amendment simply because the plan provides that other hospitals will be overcompensated. Nevertheless, we need not resolve this issue, as DMA’s plan violates the Boren Amendment even under an aggregate standard.

       We must also assume, as DMA did, that base year costs, adjusted for inflation, are a reasonable proxy for the costs expected to be incurred several years later. Such an assumption is highly debatable; indeed, DMA admitted below that “the three year lag between the base data year and the reimbursement year allowed a disconnect to occur between payment and cost.” Nevertheless, we may assume the assumption’s correctness for purposes of evaluating DMA’s plan.

       If, as DMA claims, aggregate reimbursements under its plan are sufficient to cover the aggregate costs incurred by efficiently and economically operated hospitals, it is only because DMA’s assumption that all hospitals are efficient and economical is incorrect.

       (Punctuation omitted.) Bradley, supra.

        See Alaska State Hosp., supra at 764-765; Pinnacle Nursing Home, supra at 1316-1317.

       See Missouri Dept. of Social Svcs. &c. v. Great Plains Hosp., 930 SW2d 429, 438 (Mo. App. 1996) (where amended plan held invalid for failure to procedurally comply with Boren Amendment, hospital “was entitled to be reimbursed pursuant to the previous unamended plan until such time as that plan is changed according to the applicable procedures”); Avon Nursing Home v. Axelrod, 83 N.Y.2d 977, 983 (639 NE2d 1124) (1994) (after amended plan invalidated by federal court for procedural violation of Boren Amendment, state court ordered Medicaid agency to “recalculate petitioners’ reimbursement rates for the affected years under the previously existing rate structure”); Volk v. State, 104 Ore. App. 27, 37 (799 P2d 658) (1990) (“on invalidation of plan amendments, reimbursement must be made pursuant to the previous unamended plan”); New England Mem. Hosp. v. Rate Setting Comm., 394 Mass. 296, 304 (475 NE2d 740) (1985) (“Where no effective new rate has been established, the old rate remains in effect.”).

       See Ga. Const., Art. I, Sec. Ill, Par. I (a) (“[Plrivate property shall not be taken or damaged for public purposes without just and adequate compensation being first paid”).

       See State Bd. of Ed. v. Drury, 263 Ga. 429, 433 (1) (437 SE2d 290) (1993) (property interest necessary for takings claim). See also Oberlander v. Perales, 740 F2d 116, 120 (2nd Cir. 1984) (no property interest in future rate of Medicaid reimbursements).


text:
    A00A1695.
    LA PETITE ACADEMY, INC. et al. v. TURNER et al.
    (543 SE2d 393)
   Ruffin, Judge.

Two-year-old Tahri Turner was in day care at La Petite Academy, Inc. when he fell and broke his leg. His parents, Frederick and Elisa Turner, sued the Academy, its director, Suzanne Reed, and Tahri’s teacher, Isis Roque. The Turners alleged that the defendants acted negligently, and sought both compensatory and punitive damages. The Academy and Reed moved for summary judgment, but the trial court denied the motion. For reasons that follow, we reverse.

Viewed in the light most favorable to the Turners, the record shows that, in November 1995, Roque went to work for the Academy. Although Roque did not have prior experience working in day care, the Academy provided no training regarding the care of children.

On May 10, 1996, Roque was in charge of a room of two-yearolds. Roque testified that, because there were between twelve and fourteen children in the room, there should have been at least two adult caregivers present. Roque, however, was the only adult in the room. At approximately 3:00 in the afternoon, Roque was seated with the children in a corner of the classroom. The only child who was not seated with the group was Tahri, who was riding a “Little Tykes” tricycle around the classroom. This plastic tricycle had no pedals, but was low enough to the ground that a small child could move the toy using his feet. Roque, who observed Tahri from across the room, said that he was “zooming back and forth” across the floor. According to Roque, she told Tahri several times to join her and the other children, but he did not want to sit down, so she let him continue playing on the tricycle.

After riding the tricycle for about 20 minutes, Tahri fell while attempting to turn the tricycle, pinning his leg under the tricycle. He threw the toy off of his leg and began screaming. Roque initially attempted to comfort the child, but when he continued crying, she went to report the accident to Reed. Before reaching Reed’s office, however, another teacher told Roque that Reed “was on a very important phone call.” Rather than interrupt Reed, Roque left a message. Reed, who apparently received the message, came to the classroom within 15 minutes of the accident.

Someone from the Academy attempted to call Tahri’s parents, but apparently was unable to reach them. As Roque believed that Tahri needed medical attention, Reed decided to call an ambulance. Roque rode with Tahri to the hospital, where doctors discovered that he had a broken leg.

1. The defendants assert that there is no evidence tending to show that they acted negligently in supervising Tahri. Accordingly, the defendants contend that the trial court erred in failing to grant their motion for summary judgment. We agree.

As the Turners’ claim is one for negligence, they must show that the defendants owed a duty to Tahri, that they breached this duty by failing to exercise ordinary and reasonable care, and that this breach of duty resulted in the injury to Tahri. The standard of care is that of the average parent. As such, the

person is not an insurer of the safety of the child and has no duty to foresee and guard against every possible hazard. The measure of precaution which must be taken by one having a child in his care, who stands in no relation to the child except that he has undertaken to care for it, is that care which a prudent person would exercise under like circumstances.

In providing day care for Tahri, the defendants clearly had a duty to exercise reasonable care for his safety. Although Tahri suffered an unfortunate injury, there is no evidence that this injury stemmed from a breach of defendants’ duty.

Tahri was injured while riding a tricycle. There is no evidence, nor do the Turners contend, that the toy was inappropriate for children of Tahri’s age. Indeed, Tahri and other children in his class had ridden the tricycle before without incident. Accordingly, the mere fact that he was riding the tricycle when he fell does not support a finding that the defendants were negligent.

The Turners suggest that Roque acted negligently in allowing Tahri to ride the toy in an unsafe manner. According to the Turners, Tahri was riding too quickly and Roque should have stopped him. On deposition, Roque testified that Tahri had been going “rather” fast before the fall and that, on other occasions, she had stopped him from going fast to prevent him from hitting another child. She claimed that she did not stop him on the day of the fall because he was the only child “running around” the classroom. Contrary to the Turners’ suggestion, this testimony does not show that riding the tricycle quickly was dangerous to Tahri or even that Roque believed it was so. Accordingly, the fact that Roque did not stop Tahri does not demonstrate that she was negligent.

The Turners further allege that Roque was inadequately trained and that Tahri’s classroom was understaffed. Even assuming, as we do for purposes of summary judgment, that these allegations are true, it does not follow that the defendants are liable for negligence. There must be a causal link between the alleged breach of duty and the injury caused, and defendants fail to show how lack of training or understaffing caused Tahri’s injury.

The Turners argue that, if another teacher had been present, Roque would have been able to “lure” Tahri back to the group. Roque acknowledges that, had another teacher been present, she “could have” gone to Tahri and attempted to bring him into the group. Whether Roque actually would have forced Tahri to rejoin the group, however, is mere speculation. “[W]hen the matter remains one of pure speculation or conjecture, ... it becomes the duty of the [trial] court to grant summary judgment for the defendant [s].”

Decided November 29, 2000

Reconsideration denied December 14, 2000

Warren R. Hinds, for appellants.

Middleton, Mathis, Adams & Tate, Charles A. Mathis, Jr., Nicol J. Hanyard, for appellees.

Here, the record shows that a two-year-old child decided to ride a tricycle and that his teacher saw no harm in allowing him to do so. There is no evidence indicating that the teacher’s decision was unreasonable under the circumstances. Although Tahri was injured while riding the tricycle, “[i]t is a well settled principle of negligence law that the occurrence of an unfortunate event is not sufficient to authorize an inference of negligence.” Thus, as the evidence demonstrates that Tahri’s injury stemmed from an unfortunate accident rather than negligence, the trial court erred in denying defendants’ motion for summary judgment.

2. The Turners also seek damages based on the defendants’ failure to seek timely medical treatment. To recover on this basis, the Turners must show that the alleged delay somehow exacerbated Tahri’s injury. Here, however, there is no evidence that Tahri’s condition worsened because of a delay in obtaining medical treatment. Accordingly, the trial court erred in denying the defendants’ motion for summary judgment on this basis.

3. In view of our holding in Divisions 1 and 2, we need not address the defendants’ remaining enumerations of error.

Judgment reversed.

Andrews, P. J., and Ellington, J., concur.

       See Hemphill v. Johnson, 230 Ga. App. 478 (497 SE2d 16) (1998).

       The plaintiffs cite Reed’s deposition testimony regarding the attempted calls to Tahri’s parents. However, the transcript from her deposition was not included in the record, and we cannot consider any statements that are not supported by the record on appeal. Yeary v. Bell, 228 Ga. App. 522 (1) (492 SE2d 278) (1997).

        Bull Street Church of Christ v. Jensen, 233 Ga. App. 96, 98-99 (1) (504 SE2d 1) (1998).

        Wallace v. Boys Club of Albany, 211 Ga. App. 534, 535 (439 SE2d 746) (1993).

       (Punctuation omitted.) Id.

        Laite v. Baxter, 126 Ga. App. 743, 749 (2) (191 SE2d 531) (1972).

       Indeed, Roque testified that she did not believe the accident resulted from the fact that she was alone in the classroom.

       (Punctuation omitted.) Shadburn v. Whitlow, 243 Ga. App. 555, 557 (533 SE2d 765) (2000).

       At some point, the Turners alleged that Roque pushed Tahri off the tricycle, and the trial court noted this allegation in its order. As the Turners acknowledge on appeal, however, there is no competent evidence in the record that Tahri was pushed. Thus, we do not address this allegation on appeal.

       (Punctuation omitted.) Id.

        Laite, supra.

       See Seibers v. Dixie Speedway, 220 Ga. App. 811, 813 (2) (470 SE2d 452) (1996).

       Compare id. (jury issue as to whether delaying head injury victim from seeking medical attention for two hours caused further harm).