NO. COA13-1053
NORTH CAROLINA COURT OF APPEALS
Filed: 16 September 2014
STEPHEN C. NICHOLSON, Individually
and as Administrator of the Estate
of Geraldine Anne Nicholson,
Plaintiff,
v. Robeson County
No. 08 CVS 1845
ARLEEN KAYE THOM, M.D.,
Defendant.
Appeal by Defendant from Judgment entered 16 October 2012
and Order entered 19 December 2012 by Judge Mary Ann Tally in
Robeson County Superior Court. Heard in the Court of Appeals 19
February 2014.
Comerford & Britt, L.L.P., by John A. Chilson and Clifford
Britt, and Musselwhite, Musselwhite, Branch & Grantham, by
James W. Musselwhite, for Plaintiff.
Yates McLamb and Weyher, L.L.P., by Dan McLamb and Andrew
C. Buckner, for Defendant.1
STEPHENS, Judge.
Background
This case arises from claims of negligence and loss of
consortium brought on 21 May 2008 by Plaintiff Stephen C.
1
Different counsel represented Defendant at trial.
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Nicholson, administrator of the estate of his wife Geraldine
Anne Nicholson (“the decedent”). Prior to 28 June 2005, at the
age of fifty-four, the decedent began experiencing heavy rectal
bleeding. It was later discovered that she had a cancerous tumor
in her rectum. Plaintiff’s claims stem from a surgical procedure
performed by Defendant Arleen Kaye Thom, M.D., to remove the
tumor. The surgery was performed at Cape Fear Valley Medical
Center (“Cape Fear”) on 28 June 2005. At the time of the
surgery, Defendant was a general surgeon with special training
and experience in performing cancer surgery. In order to remove
the tumor, Defendant made a large abdominal incision to expose
the decedent’s bowels, a separate incision to completely remove
the rectum and anus, and inserted a colostomy bag to allow stool
to pass through the abdominal wall.
The decedent’s post-surgical treatment included
chemotherapy and radiation therapy. Over the next few weeks, as
the treatment was beginning, the decedent started to get
unusually sick. She had problems with nausea and diarrhea that
led to abnormalities with her body chemistry. She got weaker and
was readmitted to Cape Fear for weakness, inability to eat,
diarrhea, and problems with electrolytes. On 31 August 2005, two
months and twenty-six days after the surgery, an X ray revealed
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a retained surgical sponge in the right lower quadrant of the
decedent’s abdomen.
One week later, on 7 September 2005, an additional
operation was performed to remove the sponge. The middle part of
the decedent’s abdomen was reopened, and the sponge was removed.
According to expert testimony offered on Plaintiff’s behalf, the
surgery revealed that “there was a perforation of the bowel
[and] the [retained sponge] was contaminated with intestinal
contents. There was an abscess2 around [the sponge and] dense
adhesions3 all the way around.” As a result, the surgeon removed
a section of the decedent’s bowel, spent forty-five minutes
dividing the scar tissue that was nearby, and ultimately removed
the sponge. The surgeon did not close the skin around the
abdominal wall because of “the amount of infection that was
present.”4
After the September surgery, the decedent received
additional care for the open wound. She also underwent multiple
2
The expert testified that an abscess is “the combination of
bacteria together with the body’s inflammatory cells.”
3
An adhesion is “scar tissue.”
4
Specifically, the surgeon “was able to close the inner layer
[of the abdominal wound, but] he was not able to close the
subcutaneous fat and the skin . . . .”
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additional surgeries between September 2005 and February 2006.
The first of these additional surgeries was an attempt to close
the abdominal wound resulting from the previous surgery. This
surgery failed, and another surgery was required to complete
that procedure. The decedent also needed a third operation,
according to Plaintiff’s expert, “because she developed
progressive blockage of her intestines from the scar tissue that
was related to the sca[r]ring from the sponge.” A fourth
operation was later required to repair leakage resulting from
the third surgery. Lastly, the decedent required surgery to
address an infection of the skin. Plaintiff’s expert testified
that all of these surgeries were necessary as a result of the
retained sponge.
The expert also testified that the decedent was not able to
complete her chemotherapy and radiation therapy as a result. The
decedent’s cancer returned in July of 2006 and metastasized to
her brain. From the date of her admission to Cape Fear on 31
August 2005 to the date of her death in 2006, the decedent
changed hospitals, “but she never left a hospital bed.” She died
in 2006 as a result of the cancer.
In his complaint, Plaintiff alleged that Defendant
negligently failed to remove the surgical sponge from the
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decedent’s abdomen and, in failing to do so, caused much of “the
damage[] sustained by the dece[dent] prior to her death[.]”
Specifically, Plaintiff contended that Defendant’s actions
directly and proximately damaged the decedent in the form of
medical bills, pain and suffering, scarring and disfigurement,
“multiple additional medical impairments,” “multiple additional
surgical procedures,” 401 days of life spent in the hospital,
and an inability to complete recommended cancer treatments
leading to a “shortened life expectancy.” Plaintiff also brought
a cause of action for loss of consortium, asserting that
Defendant’s alleged negligence caused “a loss and disruption of
the marital relationship” he had enjoyed with the decedent,
including “the loss and disruption of her marital services,
society, affection, companionship and/or sexual relations.”
Plaintiff did not bring a cause of action for wrongful death.
Defendant denied the material allegations of Plaintiff’s
complaint by answer filed 30 July 2008.
During discovery Plaintiff learned that Defendant had been
“disabled” since the middle of August 2005. As a result,
Plaintiff served a second request for production of documents on
8 January 2010, seeking a copy of Defendant’s application for
disability benefits, correspondence regarding that claim, and a
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copy of all of Defendant’s medical records “that relate or
pertain to [a disability] in her left arm that she sustained on
or about” 17 August 2005. Plaintiff served a third5 set of
interrogatories on Defendant that same day, seeking the “full
details” of the 17 August 2005 injury to Defendant’s arm.
Defendant objected to these discovery requests on 10 February
2010. One week later Plaintiff filed a motion to compel
Defendant to respond to the challenged discovery requests. In an
affidavit filed with the trial court, one of Defendant’s
attorneys averred that he believed the requested documents were
protected under the physician-patient privilege. The trial
court, Judge Ola M. Lewis presiding, granted Plaintiff’s motion
to compel by order entered 7 April 2010, with the limitation
that the requested documents would be disclosed only to
Plaintiff’s counsel. Defendant appealed that order to this
Court.
Following Defendant’s appeal, the trial court entered an
order staying discovery until the matter could be reviewed on
appeal. Defendant also filed a motion to stay proceedings of the
5
In his brief, Plaintiff appears to refer to these
interrogatories as his “[s]econd [s]et of [i]nterrogatories.”
The supplemental record indicates, however, that the
interrogatories at issue were Plaintiff’s “third set,” not his
second.
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trial court, and that motion was granted on 15 April 2010.
Despite the interlocutory nature of Defendant’s appeal, we
reviewed the trial court’s order granting Plaintiff’s motion to
compel as affecting a substantial right and affirmed the
decision of the trial court. Nicholson v. Thom, 214 N.C. App.
561, 714 S.E.2d 868 (2011) (unpublished opinion), available at
2011 WL 3570122, at *2, *8 [hereinafter Nicholson I], disc.
review denied, __ N.C. __, 724 S.E.2d 509 (2012). In so holding,
we noted that the requested documents were protected by the
physician-patient privilege, but pointed out that the trial
court is authorized to order the production of documents
protected by the physician-patient privilege, in its discretion,
when, in the opinion of the judge, they are necessary to serve
the proper administration of justice. Id. at *4–*5. Because of
“the potential relevance of the information contained in the
disputed records,” we concluded that the trial court did not
abuse its discretion by granting Plaintiff’s motion to compel.
Id. at *8. As a consequence, Defendant produced copies of the
requested records on 29 March 2012.6
6
Plaintiff alleges in his brief that, despite this order,
Defendant failed to respond to his “[s]econd” set of
interrogatories. As we noted in footnote 5, it is unclear
whether Plaintiff is actually referring to his third set of
-8-
On 14 May 2012, after reviewing the documents, Plaintiff
served a third request for production of documents on Defendant.
Specifically, Plaintiff sought access to “all of” Defendant’s
medical and pharmaceutical records pertaining to: (1) “her
cervical spine, cervical disc disease, cervical radiculopathy,
cervical stenosis, disc bulge, and laminectomy surgery,”
including magnetic resonance imaging scans; (2) “her diagnosis,
treatment, and monitoring of sacroiliitis”; (3) “her diagnosis
and treatment of depression and/or post-traumatic stress
disorder”; (4) “her diagnosis and treatment of Parsonage-Turner
Syndrome”; and (5) “the brachial plexus neuropathy in her left
arm that she sustained on . . . [17 August 2005].” Plaintiff
also requested a copy of Defendant’s records “from Advanced PT
Solutions, UNC Chapel Hill (neurosurgery), Dr. Viren Desai, Dr.
Pendleton, Dr. Robertson, Dr. Johnson, Dr. Stratus, Dr. Gluck,
Dr. Bettendorf, Home Instead, Kohll’s/RxMPSS Pharmacy,
CapeFearDiscountDrug, and Walmart Pharmacy.” Defendant objected
on grounds that the documents were privileged, irrelevant, and
not reasonably calculated to lead to the discovery of admissible
evidence, and Plaintiff again moved to compel production.
interrogatories, the subject of the litigation at issue on
appeal, or whether he is referring to a separate, second set of
interrogatories, which are not included in the record on appeal.
-9-
On 7 August 2012, the trial court, Judge James Gregory Bell
presiding, allowed Plaintiff’s motion to compel. The court
concluded that the requested discovery was “relevant and
reasonably calculated to lead to the discovery of admissible
evidence,” “reasonably tailored to address questions raised by
the recent production of Defendant’s medical and disability
records, . . . not overly burdensome, and its probative value
outweigh[ed] any potential prejudice to . . . Defendant.” The
court also concluded that the requested medical records were
protected under the physician-patient privilege, but that they
“should be produced because the interests of justice outweigh
the protected privilege.” Defendant appealed that order to this
Court on 13 August 2012.7
Four days later, on 17 August 2012, Plaintiff served a
subpoena and subpoenas duces tecum on counsel for Defendant,
seeking to have Defendant appear on 21 August 2012, testify, and
produce the following documents: (1) “all records requested by
Plaintiff in his 3rd [r]equest for [p]roduction of documents
7
The record does not indicate that the trial court entered an
order staying the proceedings below or that Defendant sought
such a stay pending review by this Court. Nonetheless, there is
no evidence that Defendant produced the requested discovery.
Rather, the parties proceeded toward trial. Following the trial,
Plaintiff moved to dismiss the appeal as moot, and this Court
granted that motion.
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which were ordered to be produced by . . . Judge Bell on August
7, 2012” and (2) “[t]he original or certified copy of Cape
Fear[’s] entire chart for [Defendant].” Defendant filed
objections and motions to quash on 21 August 2012.8
Between August 29 and 31 of 2012, Plaintiff issued fifty-
four subpoenas duces tecum to various persons, pharmacies, and
corporations, requiring them to produce either Defendant’s
“entire chart” or her medical and pharmaceutical records from
between January and September of 2005. Counsel for Defendant was
served with copies of those subpoenas on 12 September 2012. On
18 September 2012, Defendant filed an objection and motion to
quash these subpoenas or, in the alternative, for entry of a
protective order.
The matter came on for trial beginning 1 October 2012 in
Robeson County Superior Court, Judge Mary Ann Tally presiding.
Following an in camera review of the subpoenaed documents, the
trial court denied Defendant’s motion and allowed certain of the
documents to be produced to Plaintiff. The documents were not
8
On 31 August 2012, Plaintiff also served a subpoena duces tecum
on Cape Fear, again seeking production of Defendant’s “entire
chart.” Cape Fear filed a motion to quash, and the trial court
denied that motion on 1 October 2012. Defendant appealed that
order to this Court on 30 October 2012, but eventually withdrew
that appeal.
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admitted into evidence, but were referenced extensively by
counsel for Plaintiff in his questioning of Defendant.9
Plaintiff’s counsel also questioned Defendant about descriptions
of Defendant’s medical condition from sealed affidavits
submitted to the trial court in March of 2010. The affidavits,
which concerned the state of Defendant’s health at that time,
had been submitted by two of Defendant’s health care providers
in support of her request to refrain from attending the trial,
which at that time was scheduled to occur in 2010.
Other evidence admitted at trial described the course of
the decedent’s cancer treatment. In addition, Plaintiff
introduced a summary of the decedent’s medical bills, totaling
$1,219,660.36, approximately $860,000 of which was considered a
“write-off[]” by the Cumberland County Hospital System and had
not been paid by any source.
At the conclusion of the trial, the jury returned verdicts
awarding $5,050,000 to the estate and $750,000 to Plaintiff,
individually, for a total award of $5,800,000. The trial court
reduced that amount by $1,150,000 pursuant to Plaintiff’s
settlement with “other defendants in another case” and entered
9
Counsel for Defendant lodged a continuing objection to this
line of questioning at the beginning of Defendant’s testimony.
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judgment against Defendant on 16 October 2012 for a total amount
of $4,650,000.10 On 19 October and 21 November 2012,
respectively, Defendant filed motions for “Amendment of Judgment
(Remittitur) or New Trial” pursuant to Rule 59(a) and “Relief
from Judgment” pursuant to Rule 60(b). The trial court denied
those motions by order filed on 19 December 2012. Defendant
appealed that order and the trial court’s judgment entered upon
the jury’s verdict to this Court on 15 January 2013.
Discussion
On appeal, Defendant argues that the trial court erred by:
(1) denying her motion to quash the subpoenas duces tecum or,
alternatively, for entry of a protective order; (2) providing
her medical records to counsel for Plaintiff; (3) allowing
counsel for Plaintiff to question her concerning her health and
her medical records for the purpose of suggesting that she was
impaired during the surgery she performed on the decedent; (4)
allowing counsel for Plaintiff to question her and other
witnesses about the propriety of advising the decedent of the
10
The trial court’s 16 October 2012 judgment does not indicate
the name of the other defendants. Other sections of the record
on appeal and portions of the trial transcript, however,
indicate that the other defendants included the Cumberland
County Hospital System, Inc., d/b/a Cape Fear Valley Medical
Center.
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medications Defendant was taking at the time of the operation;
(5) allowing counsel for Plaintiff to introduce evidence of
medical bills “which were not actually incurred or paid by
[Plaintiff] . . . or any other entity”; (6) instructing the jury
on permanent injury; and (7) denying Defendant’s motion for
amendment of judgment (remittitur) or new trial. As discussed
below, we find no error in part, but remand for a new trial on
damages.
I. Defendant’s Medical and Pharmacy Records
A. Mootness
As a preliminary matter, we address Plaintiff’s argument
that Defendant’s appeal from the trial court’s order denying her
motion to quash and allowing the production of her medical and
pharmaceutical records is moot because the subpoenaed documents
were never entered into evidence. We disagree.
In North Carolina, an issue is moot
[w]henever[] during the course of litigation
it develops that the relief sought has been
granted or that the questions originally in
controversy between the parties are no
longer at issue[. In those circumstances,]
the case should be dismissed [as moot], for
courts will not entertain or proceed with a
cause merely to determine abstract
propositions of law.
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In re Hamilton, __ N.C. App. __, __, 725 S.E.2d 393, 396 (2012)
(citation omitted).
In this case Defendant requests that this Court determine
the validity of the trial court’s rulings because she contests
the result stemming from the production of her records to
Plaintiff — the extensive use of those documents by Plaintiff
during questioning of Defendant. This issue remains in
controversy between the parties and, therefore, would not
require this Court to merely determine an abstract proposition
of law. Therefore, the issue of the validity of the trial
court’s ruling on the production and use of Defendant’s medical
and pharmaceutical records is not moot. Accordingly, Plaintiff’s
argument is overruled, and we proceed with a review of
Defendant’s arguments on the merits.
B. Standard of Review
“When the propriety of a subpoena duces tecum is
challenged, it is . . . addressed to the sound discretion of the
court in which the action is pending.” Vaughn v. Broadfoot, 267
N.C. 691, 697, 149 S.E.2d 37, 42 (1966). “It is well established
that where matters are left to the discretion of the trial
court, appellate review is limited to a determination of whether
there was a clear abuse of discretion.” White v. White, 312 N.C.
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770, 777, 324 S.E.2d 829, 833 (1985). “A trial court may be
reversed for abuse of discretion only upon a showing that its
actions are manifestly unsupported by reason . . . [or] upon a
showing that [the trial court’s ruling] was so arbitrary that it
could not have been the result of a reasoned decision.” Id.
With regard to the production and use of contested medical
records, a trial court’s determination regarding the
applicability of the physician-patient privilege is a legal
question, which is reviewed de novo on appeal. See Nicholson I,
2011 WL 3570122 at *3. However,
[t]he decision as to whether disclosure of
information protected by the physician-
patient privilege is required to serve the
proper administration of justice is one made
in the discretion of the trial judge, and
the appellant must show an abuse of
discretion in order to successfully
challenge the ruling.
Id. at *8. Here, the parties do not dispute the fact that
Defendant’s medical records are protected by the physician-
patient privilege. Rather, Defendant contests the validity of
the trial court’s decisions to produce those documents to
Plaintiff and allow Plaintiff to use the documents during
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questioning of Defendant. Accordingly, the standard of review
for each of these issues is abuse of discretion.11
C. Subpoenas Duces Tecum
Defendant contends that the trial court abused its
discretion in overruling her objection and denying her motion to
quash Plaintiff’s subpoenas duces tecum or, in the alternative,
for entry of a protective order because the subpoenas were
improperly used for purposes of discovery and their issuance
violated the Health Insurance Portability and Accountability Act
(“HIPAA”). In response, Plaintiff contends the subpoenas were
not issued for the purpose of discovery and Defendant was
properly given notice of their issuance and an opportunity to
object. We find no error.
i. The Purpose of the Subpoenas Duces Tecum
The subpoena duces tecum . . . is the
process by which a court requires the
production at the trial of documents,
papers, or chattels material to the
issue. . . .
. . . .
Anything in the nature of a mere fishing
expedition is not to be encouraged. A party
11
Defendant argues in her brief that the standard of review in
this context is de novo. At oral argument, however, counsel for
Defendant conceded that the proper standard of review is abuse
of discretion.
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is not entitled to have brought in a mass of
books and papers in order that he may search
them through to gather evidence.12
The law recognizes the right of a witness
subpoenaed duces tecum to refuse to produce
documents which are not material to the
issue or which are of a privileged
character. Nevertheless, whether a witness
has a reasonable excuse for failing to
respond to a subpoena duces tecum is to be
judged by the court and not by the witness.
Though he may have [a] valid excuse for not
showing . . . the document in evidence, yet
he is bound to produce it, which is a matter
for the judgment of the court and not the
witness.
. . . . [On a motion to quash] a subpoena
duces tecum . . . , the court
. . . examine[s] the issues raised by the
pleadings and, in the light of that
examination, . . . determine[s] the apparent
relevancy of the documents or the right of
the witness to withhold production upon
other grounds. An adverse ruling upon [the]
movant’s motion to quash . . . gives counsel
[for the respondent] no right to inspect the
books, documents, or chattels ordered to be
produced at the trial, nor does it determine
the admissibility of [those] items at the
trial. The subpoena merely requires the
witness to bring them in so that the court,
after inspection, may determine their
materiality and competency, or so that the
witness, by reference to the books or
papers, can answer any questions pertinent
12
To the extent this paragraph might be read to allow fishing
expeditions under certain circumstances, we note this Court’s
clarification that such ventures are prohibited in their
entirety. State v. Newell, 82 N.C. App. 707, 709, 348 S.E.2d
158, 160 (1986).
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to the inquiry.
Vaughn, 267 N.C. at 695–97, 149 S.E.2d at 40–42 (citations,
internal quotation marks, parentheses, and an ellipsis omitted).
Defendant contends that Plaintiff’s subpoenas duces tecum
were improper because they “were not issued to secure evidence
for presentation for trial, as proven by the fact that none of
the documents were offered into evidence.” Rather, Defendant
contends, “they were simply an improper form of discovery.” We
disagree.
The subpoenaed documents were not offered into evidence
during the trial because the trial court determined in a
pre-trial, in camera hearing that they could not be admitted
into evidence. This fact was already established by the time the
trial began and has no bearing on whether the subpoenas were
issued for purposes of engaging in an improper fishing
expedition. Indeed, as Plaintiff notes in his brief, his
attorneys were never given an opportunity to inspect the
subpoenaed documents prior to their production. They were
sealed, sent directly to the courthouse, and ultimately
inspected by the trial court, which determined that some of the
documents should be produced to Plaintiff’s counsel for use
during the trial, and some should not. Plaintiff was never
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allowed to fish through the documents to gather evidence and,
thus, was not engaging in discovery. Moreover, in light of our
opinion in Nicholson I, we believe the trial court’s decision
that some of the requested records were sufficiently relevant to
require production to Plaintiff, but not so relevant as to be
admitted as substantive evidence, was neither arbitrary nor
manifestly unsupported by reason. See 2011 WL 3570122 at *8 (“In
view of the potential relevance of the information contained in
the disputed records, we are unable to conclude that the trial
court abused its discretion by ordering Defendant to produce the
requested materials in the interest of justice.”). Accordingly,
Defendant’s argument is overruled.
ii. HIPAA
In the alternative, Defendant contends that Plaintiff’s
subpoenas duces tecum violated HIPAA because they were not
accompanied by a court order showing that “reasonable efforts
have been made to ensure that [Defendant was] . . . given notice
of the request and an opportunity to object or that efforts have
been made to obtain a protective order prohibiting the use of
the records for any use other than the proceeding,” citing 45
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C.F.R. § 164.512(e)(1)(ii). Defendant contends that the alleged
violation was prejudicial because her objections would have been
heard prior to the issuance of the subpoenas “[h]ad . . .
Plaintiff[] sought the order [as] required by HIPAA.” Therefore,
Defendant alleges, “[t]he trial judge . . . [denied] defense
counsel any opportunity to review [the subpoenaed documents] and
assert appropriate objections prior to their production.” We are
unpersuaded.
Section 164.512 of Subchapter C of Title 45, Subtitle A, of
the Code of Federal Regulations provides in pertinent part that,
under HIPAA:
A covered entity may use or disclose
protected health information without the
written authorization of the individual
. . . or the opportunity for the individual
to agree or object . . . subject to the
applicable requirements of this
section. . . .
. . . .
(e) Standard: Disclosures for judicial and
administrative proceedings — (1) Permitted
disclosures. A covered entity may disclose
protected health information in the course
of any judicial or administrative
proceeding:
. . .
(ii) In response to a subpoena, discovery
request, or other lawful process, that is
not accompanied by an order of a court or
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administrative tribunal, if:
(A) The covered entity receives satisfactory
assurance . . . from the party seeking the
information that reasonable efforts have
been made by such party to ensure that the
individual who is the subject of the
protected health information that has been
requested has been given notice of the
request; or
(B) The covered entity receives satisfactory
assurance . . . from the party seeking the
information that reasonable efforts have
been made by such party to secure a
qualified protective order . . . .
45 C.F.R. 164.512 (2013). Section 160.102 of Subchapter C also
states that:
(a) Except as otherwise provided, the
standards, requirements, and implementation
specifications adopted under this subchapter
apply to the following entities:
(1) A health plan.
(2) A health care clearinghouse.
(3) A health care provider who transmits any
health information in electronic form in
connection with a transaction covered by
this subchapter.
45 C.F.R. 160.102 (2013).
To the extent Plaintiff’s subpoenas did not comply with the
regulations cited above,13 such violation should be charged
13
We offer no opinion as to whether they did.
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against the covered entities that provided those records, not
against Plaintiff. Section 160.102 clearly states that
Subchapter C of HIPAA applies to health plans, health care
clearinghouses, and certain health care providers. Plaintiff is
none of these things. Assuming without deciding that the
subpoenaed entities in this case qualify as “covered entities,”
it was their obligation to refrain from producing the requested
documentation when they received Plaintiff’s subpoenas if they
determined that the subpoenas did not comply with HIPAA. Because
Plaintiff is not a “covered entity” within the meaning of
section 160.512, he cannot be held liable under Subchapter C of
HIPAA for the subpoenaed entities’ production of the requested
documents. Therefore, the requirements cited by Defendant have
no bearing on whether Plaintiff’s subpoenas duces tecum were
properly issued. Accordingly, Defendant’s argument is overruled.
D. Providing Defendant’s Records to Plaintiff
Defendant next argues that the trial court erred by
providing Plaintiff with medical and pharmaceutical records that
did not comply with its own order. Specifically, Defendant
alleges that the trial court provided Plaintiff with records
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created after 28 June 2005, despite its explicit statement at
trial that documents generated after that date should not be
produced to Plaintiff. In response, Plaintiff asserts that “the
documents provided to this Court . . . [by Defendant]14 were not
properly preserved for appeal” because Defendant did not take
the opportunity to preserve a copy of the documents at trial and
the documents merely constitute those documents that Defendant
“believes may have been provided to Plaintiff’s trial counsel at
trial.” (Emphasis in original). Alternatively, Plaintiff asserts
that the documents provided to counsel caused Defendant no harm
because Plaintiff already knew about her use of pain
medications. We find no error.
Rule 11(c) of the North Carolina Rules of Appellate
Procedure provides that, when settling the record on appeal,
[i]f any party to the appeal contends that
materials proposed for inclusion in the
record or for filing . . . were not filed,
served, submitted for consideration,
admitted, or made the subject of an offer of
proof, or that a statement or narration
permitted by these rules is not factually
accurate, then that party, within ten days
after expiration of the time within which
the appellee last served with the
14
These documents were not included in the record on appeal.
Rather, they were submitted to this Court, under seal, pursuant
to Rule 11(c) of the North Carolina Rules of Appellate
Procedure. Plaintiff was not served with a copy.
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appellant’s proposed record on appeal might
have served amendments, objections, or a
proposed alternative record on appeal, may
in writing request that the judge from whose
judgment, order, or other determination
appeal was taken settle the record on
appeal. A copy of the request, endorsed with
a certificate showing service on the judge,
shall be filed forthwith in the office of
the clerk of the superior court and served
upon all other parties. Each party shall
promptly provide to the judge a reference
copy of the record items, amendments, or
objections served by that party in the case.
. . . .
The judge shall send written notice to
counsel for all parties setting a place and
time for a hearing to settle the record on
appeal. The hearing shall be held not later
than fifteen days after service of the
request for hearing upon the judge. The
judge shall settle the record on appeal by
order entered not more than twenty days
after service of the request for hearing
upon the judge. . . .
If any appellee timely serves amendments,
objections, or a proposed alternative record
on appeal, and no judicial settlement of the
record is timely sought, the record is
deemed settled at the expiration of the ten
day period within which any party could have
requested judicial settlement of the record
on appeal under this Rule 11(c).
N.C.R. App. P. 11(c).
Citing Rule 11(c), Defendant has provided this Court with a
number of documents that she believes were produced to Plaintiff
during the trial. In an attached letter to the trial judge,
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Defendant requested confirmation that the documents submitted to
this Court represent those produced to Plaintiff. Plaintiff’s
attorneys were provided with a copy of the letter, but not with
a copy of the proposed documents. There is no indication in the
record before this Court that the accuracy of the documents
provided by Defendant was ever verified by the trial judge or
that further action was taken to settle the record on appeal
with regard to this question.
As described above, Rule 11(c) operates to settle the
record on appeal in accordance with the objections of the
appellee when no judicial settlement is timely sought at the
expiration of the requisite time period. Id.; see also Johnson
v. Nash Comm. Coll., 203 N.C. App. 572, 692 S.E.2d 890 (2010)
(unpublished opinion), available at 2010 WL 1542534 (“When the
[appellee] objected to [the appellant’s] proposed record on
appeal . . . , [the appellant] filed a statement that he was not
requesting judicial settlement. The record on appeal was,
therefore, deemed settled in accordance with the [appellee’s]
objections by operation of Rule 11(c) . . . .”).15 Rule 11(c)
15
Johnson is an unpublished opinion and, therefore, has no
precedential value. N.C.R. App. P. 30(e). Nevertheless, case law
on Rule 11(c) is scant, and our opinion in Johnson provides a
helpful example of the practical application of this rule.
-26-
makes no provision, however, for the requirements for settling
the record on appeal when the appellant is admittedly unsure
about the nature of the proposed supplement to the record,
requests judicial settlement, does not serve the proposed
documentation on the appellee, and judicial settlement never
occurs. In that circumstance, we must default to the broader
requirements of Rule 9(a).
Rule 9(a) states in pertinent part that “review is solely
upon the record on appeal.” N.C.R. App. P. 9(a).
This Court has held that where certain
exhibits presented to the trial court were
not included in the record on appeal, those
exhibits could not be considered on review
to this Court. To raise the issue of the
sufficiency of the evidence to support that
finding on appeal, [the] defendant must
preserve the record for appeal. Where the
record is silent[,] we will presume the
trial court acted correctly.
State v. Reaves, 132 N.C. App. 615, 619–20, 513 S.E.2d 562, 565
(citations and internal quotation marks omitted), disc. review
denied, 350 N.C. 846, 539 S.E.2d 4 (1999). When the record is
“not completely silent,” but fails to include the information
necessary for appellate review, “we presume the correctness of
the trial court’s decision.” See id. at 620, 513 S.E.2d at 565
(presuming the correctness of the trial court’s decision to
order the defendant to produce a report, which the defendant
-27-
argued was protected work product, when the record on appeal
included references to the content of the report, but did not
include the report itself).
Regarding the documents produced to Plaintiff in this
case, the trial court ruled as follows:
THE COURT: . . . .
. . . .
I have reviewed the medical records and
information of [Defendant] that was provided
pursuant to the subpoenas. And after
reviewing that information, I find that it’s
in the interest of justice and outweighs the
privilege for certain information to be
turned over to Plaintiff’s counsel. The
information is contained in this material
that I have in my hand.
For the record, basically, what I have done
is delineated information concerning
[Defendant] that may have some bearing on
issues in this case using the date of June
28, 2005, as the cutoff date. I am
withholding and upholding the privilege with
regard to any medical information that has
to do with dates and times after June 28,
2005.
On appeal, we have no way to ascertain whether the
documents submitted in Defendant’s supplement to the record are
the same documents that the trial court turned over to Plaintiff
at trial. Defendant avers that she believes they are, but there
is no evidence that the trial court ever settled this matter.
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Therefore, we must presume that the trial court correctly
produced documents to Plaintiff in accordance with the court’s
order. See id. at 619–20, 513 S.E.2d at 565. Accordingly,
Defendant’s argument is overruled.
E. Plaintiff’s Questions Regarding Defendant’s Records
Defendant next argues that the trial court erred in
allowing counsel for Plaintiff to question her (1) concerning
the information contained in Defendant’s medical records that
the trial court ordered produced to counsel for Plaintiff, as
well as the sealed affidavits provided by Defendant, and (2)
with regard to Defendant’s alleged “legal duty” to advise the
decedent that Defendant was taking medications at the time of
the operation. Defendant contends that certain of those
questions were irrelevant, highly prejudicial, improper without
the support of medical expert testimony, and inadmissible
hearsay. We find no error.
i. Legal Background and Standards of Review
Rule 401 of the North Carolina Rules of Evidence
establishes that evidence is “relevant” if it has “any tendency
to make the existence of any fact that is of consequence to the
determination of the action more probable or less probable than
it would be without the evidence.” N.C. Gen. Stat. § 8C-1, Rule
-29-
401 (2013). All relevant evidence is admissible unless otherwise
provided by rule or law. N.C. Gen. Stat. § 8C-1, Rule 402.
“Evidence which is not relevant is not admissible.” Id.
“Although the trial court’s rulings on relevancy technically are
not discretionary and therefore are not reviewed under the abuse
of discretion standard . . . , such rulings are given great
deference on appeal.” Dunn v. Custer, 162 N.C. App. 259, 266,
591 S.E.2d 11, 17 (2004) (citation and internal quotation marks
omitted).
Rule 403 of the North Carolina Rules of Evidence provides
that relevant evidence may nonetheless “be excluded if its
probative value is substantially outweighed by the danger of
unfair prejudice, confusion of the issues, or misleading of the
jury, or by considerations of undue delay, waste of time, or
needles presentation of cumulative evidence.” N.C. Gen. Stat. §
8C-1, Rule 403. We review a trial court’s decision regarding
whether to exclude evidence under Rule 403 for abuse of
discretion. Wolgin v. Wolgin, 217 N.C. App. 278, 283, 719 S.E.2d
196, 200 (2011).
Rule 611 of the North Carolina Rules of Evidence provides
the following direction with regard to the manner and order of
questioning and the presentation of evidence at trial:
-30-
(a) Control by court. — The court shall
exercise reasonable control . . . so as to
(1) make the interrogation and presentation
effective for ascertainment of the truth,
(2) avoid needless consumption of time, and
(3) protect witnesses from harassment or
undue embarrassment.
(b) Scope of cross-examination. — A witness
may be cross-examined on any matter relevant
to any issue in the case, including
credibility.
(c) Leading questions. — Leading questions
should not be used on direct examination of
a witness except as may be necessary to
develop his testimony. Ordinarily leading
questions should be permitted on cross-
examination. When a party calls a hostile
witness, an adverse party, or a witness
identified with an adverse party,
interrogation may be by leading questions.
N.C. Gen. Stat. § 8C-1, Rule 611. This Court has determined that
the trial court’s rulings regarding questioning by an attorney
on direct examination and cross-examination under Rule 611 is
reviewed for abuse of discretion. State v. Thompson, 22 N.C.
App. 178, 180, 205 S.E.2d 772, 774 (1974) (holding that the
trial court did not abuse its discretion in allowing the
prosecutor to ask his own witness leading questions relating to
matters not giving rise to the charge); Williams v. CSX Transp.,
Inc., 176 N.C. App. 330, 336, 626 S.E.2d 716, 723 (2006) (“The
trial court is vested with broad discretion in controlling the
scope of cross-examination[,] and a ruling by the trial court
-31-
should not be disturbed absent an abuse of discretion and a
showing that the ruling was so arbitrary that it could not have
been the result of a reasoned decision.”).
We also note that, when considering alleged evidentiary
errors in civil cases, “[n]o error . . . is ground for granting
a new trial or for setting aside a verdict or for vacating,
modifying, or otherwise disturbing a judgment or order, unless
refusal to take such action amounts to the denial of a
substantial right.” N.C. Gen. Stat. § 1A-1, Rule 61 (2013). An
error affects a substantial right of the appellant when it
prejudiced her and, thus, when “it is likely that a different
result would have ensued had the error not been committed.” In
re Chasse, 116 N.C. App. 52, 60, 446 S.E.2d 855, 859 (1994)
(citation omitted).
ii. On the Issue of Impairment During Surgery
Defendant argues that the trial court erred in allowing
counsel for Plaintiff to question her about information
contained in Defendant’s medical and pharmaceutical records as
well as the sealed affidavits she provided to the trial court in
2010 because such information was not relevant and was “highly
prejudicial” in nature. Specifically, Defendant contends that
this line of questioning “inevitably tainted the entire trial”
-32-
and that Plaintiff exceeded the bounds of permissible
examination by asking about side effects discussed in affidavits
submitted by Defendant’s health care providers in 2010. Lastly,
Defendant asserts that the trial court erred by permitting this
testimony because a party must present “medical expert
testimony” whenever cross-examining another party regarding “the
potential side effects of medications being taken by that
party.” We are unpersuaded.
As a preliminary matter, we note that Defendant was called
and questioned by counsel for Plaintiff as a part of Plaintiff’s
case in chief. The questioning Defendant refers to as
impermissible occurred entirely on direct and redirect
examination of Defendant, an adverse party. Therefore, pursuant
to Rule 611, leading questions were permissible. N.C. Gen. Stat.
§ 8C-1, Rule 611(c). In addition, it is helpful to understand
that this case was tried under a theory of negligence as
established by the doctrine of res ipsa loquitur.
Uniformly, in this and other courts,
res ipsa loquitur has been applied to
instances where foreign bodies, such as
sponges . . . , are introduced into the
patient’s body during surgical operations
and left there.
. . . .
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. . . [T]he well-settled law in this
jurisdiction is and has been that a surgeon
is under a duty to remove all harmful and
unnecessary foreign objects at the
completion of the operation. Thus the
presence of a foreign object raises an
inference of a lack of due care. When a
surgeon relies upon nurses or other
attendants for accuracy in the removal of
sponges from the body of his patient, he
does so at his peril. . . .
. . . .
. . . The application of res ipsa loquitur
allows the issue of whether [the] defendant
has complied with the statutory standard to
be submitted to the jury for its
determination. Although the application of
the doctrine requires the submission of the
issue to the jury, the burden remains upon
the plaintiff to satisfy the jury that the
defendant has failed to comply with the
statutory standard. [The d]efendant’s
evidence that he complied with the statutory
standard does not remove the case from the
jury’s determination. As the trier of the
facts, the jury remains free to accept or
reject the testimony of [the] defendant’s
witnesses.
Tice v. Hall, 310 N.C. 589, 592–94, 313 S.E.2d 565, 567–68
(1984) (citations and internal quotation marks omitted; emphasis
and certain italics added). Therefore, the testimony of
Defendant, elicited on direct examination by Plaintiff’s
counsel, is relevant and admissible to the extent that it makes
the existence of any fact that is of consequence to the jury’s
-34-
determination more or less likely to be true and is not
otherwise inadmissible.
On direct examination of Defendant, counsel for Plaintiff
questioned her extensively about whether she had taken narcotic
and non-narcotic pain medications leading up to and during the
surgery. Defendant responded that she was taking narcotic pain
medications leading up to the surgery, but that she only took
non-narcotic pain medications during the surgery. Defendant also
stated that side effects from the narcotic pain medications were
not present at the time of the surgery.
Plaintiff questioned Defendant further about information
contained in sealed affidavits that Defendant provided to the
trial court in 2010. Counsel for Plaintiff did not reference the
affiants or their affidavits, but used the information contained
therein to question Defendant about side effects that she
experienced after the surgery when taking the same narcotic
medications16 that she admitted to taking before the surgery.
Though Defendant acknowledged that she took the same narcotic
medications before and after the surgery, she only admitted to
experiencing side effects after the surgery.
16
Defendant was prescribed an increased amount of one of those
medications during this time.
-35-
The questions asked by counsel for Plaintiff sought to
elicit and did elicit relevant testimony. Whether Defendant was
using pain medication in the period of time leading up to and
during the surgery addresses whether she may have breached her
duty of care during the surgery. As Defendant admitted, the side
effects from some of her medications “might” have had an effect
on a doctor’s capabilities. Moreover, the extent to which those
same medications may have caused Defendant to experience
confusion and impairment of cognitive function at a later point
in time is relevant to whether those admittedly appreciable side
effects occurred prior to and during the surgery. Defendant’s
responses to Plaintiff’s questions dealt with these issues. As a
result, her testimony had some tendency to make consequential
facts more or less likely to be true and, therefore, was
relevant. In addition, given our opinion in Nicholson I, which
concluded that certain of Defendant’s medical records could be
relevant, and considering Plaintiff’s burden of establishing not
only that the sponge was left in the decedent’s body, but of
satisfying the jury that Defendant failed to comply with her
duty of care in allowing the sponge to be left in the decedent’s
body, we conclude that it was not an abuse of discretion for the
trial court to decline to exclude this line of questioning under
-36-
Rule 403. Accordingly, Defendant’s argument is overruled to the
extent that it relates to relevance and prejudice.
Defendant argues further, however, that Plaintiff’s
questions regarding the side effects of the medications were
inappropriate because (1) the questions were not supported by
expert testimony as to the side effects, and (2) Plaintiff’s
reference to the side effects as coming from a “prescription
warning that I obtained from a local pharmacist” was
inadmissible hearsay. Again, we are unpersuaded.
Defendant’s argument is based on the following questioning
of Defendant by counsel for Plaintiff:
Q. You said earlier as far as the Cymbalta[,]
that you were taking that at the time you
performed surgery on [the decedent], correct?
A. I believe so.
Q. Again, this is another prescription
warning that I obtained from a local
pharmacist.
A. Uh-huh.
Q. I want to read this and ask if you are
familiar with this warning as it relates to
the medication especially with you being a
physician.
A. Uh-huh.
Q. This drug . . . may . . . make you dizzy
or drowsy. Do not drive, use machinery, or do
any activity that requires alertness.
-37-
Do you agree or disagree with the warning
that goes with that medication?
A. I agree. If you have — if you’re taking
this medication and you have any dizziness or
drowsiness as a side effect of that
medication, then you should refrain from
driving. But not everybody reacts to the
medications the same way, and not everybody
has the same side effects. But certainly, if
you have those side effects, you should warn
— you should heed those warnings. I do not
have those side effects.
Q. Well, the warning says that the medication
can affect your alertness. Now, number one,
do you need to be alert in a long and
complicated surgical procedure?
A. Yes, you do.
Q. In your opinion — even though you are
aware of these warnings you take the
medication. In your opinion, does it affect
your alertness?
A. The Cymbalta?
Q. Yes.
A. No.
Q. Has it ever affected your alertness?
A. No.
Q. Has it ever made you drowsy?
A. No.
Q. So you’ve not had any problem with the
warnings that they give?
-38-
A. Correct.
Q. That doesn’t mean that you can’t have
those problems. I mean, certainly, you can;
is that correct?
. . . .
A. Usually, if you’re going to have those
side effects, you experience them early on
when you’re given the prescription.
Defendant first argues that the above questioning was
improper because it was not supported by expert testimony as
required by Smith v. Axelbank, __ N.C. App. __, 730 S.E.2d 840
(2012) and Anderson v. Assimos, 146 N.C. App. 339, 553 S.E.2d 63
(2001), vacated in part and appeal dismissed on other grounds,
356 N.C. 415, 572 S.E.2d 101 (2002). We disagree.
The plaintiff in Axelbank, after experiencing deleterious
side effects from a drug prescribed by her doctor, brought suit
for medical malpractice or, alternatively, for negligence under
a theory of res ipsa loquitur. __ N.C. App. at __, 730 S.E.2d at
842. Her complaint did not include certification by a medical
expert pursuant to Rule 9(j) of the North Carolina Rules of
Civil Procedure. Id.
Rule 9(j) states that a complaint alleging
medical malpractice shall be dismissed
unless a plaintiff asserts in her complaint
that her medical care has been reviewed by a
person who is willing to testify that the
medical care did not comply with the
-39-
applicable standard of care, and that this
person must be reasonably expected to
qualify as an expert witness under . . .
Rule 702 or must be a person the plaintiff
will seek to have qualified as an expert
. . . . Alternatively, a plaintiff must
allege facts establishing negligence under
the doctrine of res ipsa loquitur.
Id. On appeal, we held that the trial court properly dismissed
the plaintiff’s complaint for failure to state a claim because
she did not include certification under Rule 9(j) and she failed
to allege facts establishing negligence under the doctrine of
res ipsa loquitur. __ N.C. App. at __, 730 S.E.2d at 842–43
(“Here, a layperson would not be able to determine that [the]
plaintiff’s injury was caused by [the drug] or be able to
determine that [the doctor] was negligent in prescribing the
medication to [the] plaintiff without the benefit of expert
testimony.”).
In Assimos, the plaintiff brought suit against her doctor
for medical malpractice under a theory of res ipsa loquitur due
to side effects she experienced as a result of the doctor’s
alleged “failure to adequately[,] properly[,] and fully inform
her of the risks known to be associated with the administration
of [a] drug . . . given to [her] during her treatment.” 146 N.C.
App. at 340, 553 S.E.2d at 65. The plaintiff’s complaint did not
include a Rule 9(j) certification. Id. at 342, 553 S.E.2d at 66.
-40-
Relevant to the issues we are considering in this case, we held
that the trial court did not err in dismissing the plaintiff’s
medical malpractice action for failure to state a claim of
negligence under the doctrine of res ipsa loquitur. Id. at 343,
553 S.E.2d at 67. We noted that the side effects of the drug
were not within the jury’s common knowledge, and, therefore,
expert testimony was necessary to establish the relevant
standard of care. Id.
Axelbank and Assimos address a plaintiff’s obligation to
include medical expert certification with her complaint when the
doctrine of res ipsa loquitur does not apply to establish an
inference of negligence. Here, however, the parties are not at
the pleading stage, and the applicability of the doctrine of res
ipsa loquitur is not at issue. Our Supreme Court has already
made clear that there is a defined standard of care in cases
involving foreign objects left in the body and that the legal
doctrine of res ipsa loquitur is applicable on the issue of
breach of that standard of care. Tice, 310 N.C. at 592–94, 313
S.E.2d at 567–68. The questions regarding the side effects from
Defendant’s medications were asked to confirm the inference that
Defendant was negligent while performing the surgery. Indeed,
when the standard of care is established pursuant to the
-41-
doctrine of res ipsa loquitur, as here, our opinions in Axelbank
and Assimos indicate that expert testimony is not necessary to
establish the relevant standard of care. Accordingly,
Defendant’s argument is overruled as it relates to whether
expert testimony was required to establish the side effects of
the drugs taken by Defendant.
Defendant also argues that the challenged questioning was
improper because Plaintiff’s reference to the warning
Plaintiff’s counsel obtained from the local pharmacist
constitutes inadmissible hearsay with regard to the side effects
of the medications she was taking. We disagree.
Hearsay is “a statement, other than one made by the
declarant while testifying at the trial or hearing, offered in
evidence to prove the truth of the matter asserted.” N.C. Gen.
Stat. § 8C-1, Rule 801. Subject to a number of well-defined
exceptions, hearsay is inadmissible. N.C. Gen. Stat. § 8C-1,
Rule 802. In this case, Plaintiff’s questions were not asked to
establish the truth of the warnings obtained from the pharmacist
nor to prove the particular side effects of the medications
Defendant was taking. Rather, they were asked to elicit
Defendant’s testimony regarding the extent to which her
medications might have affected her judgment during the surgery.
-42-
Therefore, this line of questions did not constitute
inadmissible hearsay. Accordingly, Defendant’s argument is
overruled.
iii. On the Issue of Defendant’s Alleged Duty to
Advise
Defendant next argues that the trial court erred by
allowing counsel for Plaintiff to ask Defendant whether she had
a “legal duty” to advise the decedent regarding Defendant’s use
of medications prior to the surgery. Citing this Court’s opinion
in Atkins v. Mortenson, 183 N.C. App. 625, 644 S.E.2d 625
(2007), Defendant contends that such questioning should have
been supported by expert testimony establishing the relevant
standard of care. We disagree.
In Atkins, we affirmed the trial court’s award of summary
judgment to the defendant doctor in the plaintiff’s medical
malpractice action for failure of the doctor to recognize
symptoms of illness and recommend appropriate treatment. Id. at
630, 644 S.E.2d at 628. In so holding we pointed out that, in
medical malpractice cases, the standard of care “generally
involves specialized knowledge” and, therefore, expert testimony
is necessary to show a breach of the standard. Id. at 630, 644
S.E.2d at 629. Atkins does not, however, stand for the
proposition that an attorney is obligated in a res ipsa loquitur
-43-
case, in order to support direct examination of the defendant
physician, to offer expert testimony regarding the standard of
care for that physician’s disclosure to her patient of
information regarding the physician’s use of medications.
Rather, it addresses whether the plaintiff in that particular
case was able to forecast sufficient evidence to withstand
summary judgment.
Here, unlike Atkins, an inference of a lack of due care was
raised because a foreign object — the sponge — was left in the
decedent’s body. See Tice, 310 N.C. at 594, 313 S.E.2d at 568.
Therefore, as discussed above, expert testimony was not
necessary as “the presence of a foreign object raises an
inference of a lack of due care” sufficient to submit the case
to the jury for determination of whether Defendant breached her
duty. See id. at 593, 313 S.E.2d at 567. Furthermore, the cited
portions of the transcript do not indicate that counsel for
Plaintiff ever used the phrase “legal duty” when examining
Defendant. Rather, counsel asked Defendant, for example, whether
she felt “it necessary to tell any of [her] patients or to
inform any of [her] patients [about her use of medications] so
they [would] have an opportunity to decide for themselves
-44-
whether or not they want[ed her] doing the surgery.”17 Under the
circumstances of this case, Atkins is unavailing. Accordingly,
Defendant’s argument is overruled.
II. Evidence of the Decedent’s Medical Bills
Defendant also argues that the trial court erred in
allowing Plaintiff to present evidence of the decedent’s medical
bills — totaling $1,219,660.3618 — because approximately $860,000
of that total was “written off” by the Cumberland County
Hospital System and never paid by any party. “By allowing
Plaintiff[] to contend [that the decedent’s] medical expenses
totaled [over $1,000,000.00], rather than the true amount her
estate was obligated to pay,” Defendant argues, “the court
[erroneously] permitted Plaintiff[] to substantially inflate the
value of [his] claim in the minds of the jurors.” Alternatively,
Defendant contends that, if the introduction of these bills was
17
Counsel for Plaintiff later asked one of Defendant’s expert
witnesses whether “there is . . . [a] legal or ethical
obligation on the part of the doctor, or in this case a surgeon,
to inform [her] patient prior to surgery that the physician is
taking pain medication [including narcotics],” but that question
is not challenged on appeal.
18
In her brief, Defendant cites Plaintiff’s Exhibit 3 for the
fact that the medical bills totaled “$1,019,467.11.” The copy of
Plaintiff’s Exhibit 3 submitted to this Court, however, states
that the medical bills actually amounted to $1,219,660.36.
Accordingly, we use the latter figure.
-45-
proper, she should have been allowed to introduce evidence of
the fact that a substantial portion of the bills was written off
by the hospital. Plaintiff responds that the medical bills were
admissible, but the write-offs were not, pursuant to the
collateral source rule. We conclude that the collateral source
rule is not applicable here and, as a result, hold that the
trial court erred by failing to admit evidence of the hospital
system’s write-offs.
For cases filed before 1 October 2011, the admissibility of
evidence of medical expenses is governed by the common law
collateral source rule.19 According to that rule,
evidence of a plaintiff’s receipt of
benefits for his or her injury or disability
from sources collateral to [the] defendant
generally is not admissible. These benefits
include payments from both public and
private sources. This rule gives force to
the public policy which prohibits a
tortfeasor from reducing [its] own liability
for damages by the amount of compensation
the injured party receives from an
independent source. Evidence of collateral
source payments violate the rule whether
19
In 2011, the collateral source rule was abrogated by Rule 414
of the North Carolina Rules of Evidence with regard to evidence
of past medical expenses. N.C. Gen. Stat. § 8C-1, Rule 414. Rule
414 is not applicable in this case, however, because Plaintiff’s
action was commenced in 2008, before the effective date of this
new rule. See 2011 N.C. Sess. Law 283, sec. 4.2 (stating that
Rule 414 applies to actions commenced on or after 1 October
2011).
-46-
admitted in the defendant’s case-in-chief or
on cross[-]examination of the plaintiff’s
witness. The erroneous admission of
collateral source evidence often must result
in a new trial.
Badgett v. Davis, 104 N.C. App. 760, 763, 411 S.E.2d 200, 202
(1991) (citations, internal quotation marks, and brackets
omitted), disc. review denied, 331 N.C. 284, 417 S.E.2d 248
(1992).
The purpose of the collateral source rule is
to exclude evidence of payments made to the
plaintiff by sources other than the
defendant when the evidence is offered for
the purpose of diminishing the defendant
tortfeasor’s liability to the injured
plaintiff. . . . The rule is punitive in
nature[] and is intended to prevent the
tortfeasor from a windfall when a portion of
the plaintiff’s damages have been paid by a
collateral source.
Wilson v. Burch Farms, Inc., 176 N.C. App. 629, 638–39, 627
S.E.2d 249, 257 (2006) (citations, internal quotation marks, and
certain brackets omitted). In the context of medical
malpractice, our Supreme Court has indicated that a source
collateral to the defendant can include “a beneficial society,
the plaintiff’s family or employer, or an insurance company.”
Cates v. Wilson, 321 N.C. 1, 5, 361 S.E.2d 734, 737 (1987)
(citation and internal quotation marks omitted). When payment
comes from such a source, “an injured plaintiff is entitled to
-47-
recovery for reasonable medical, hospital, or nursing services
rendered [her], whether these are rendered . . . gratuitously or
paid for by [her] employer.” Id. (citations, internal quotation
marks, and ellipsis omitted). “In summary, the collateral source
rule excludes evidence of payments made to the plaintiff by
sources other than the defendant when this evidence is offered
for the purpose of diminishing the defendant tortfeasor’s
liability to the injured plaintiff.” Badgett, 104 N.C. App. at
764, 411 S.E.2d at 203.
Plaintiff relies on our opinion in Badgett to support his
argument that the collateral source rule is applicable in this
case. We disagree. In Badgett, the plaintiff sued his doctor in
negligence for knowingly prescribing a drug to which the
plaintiff was allergic. Id. at 761, 411 S.E.2d at 201. The
plaintiff became ill and was treated at a hospital. Id. At
trial, the court admitted evidence of the plaintiff’s total
hospital and doctor’s bills, evidence that a portion of the
bills had been paid by Medicare, and evidence that, “according
to the hospital’s contract with Medicare, the unpaid balance was
written off and could not thereafter be collected from the
plaintiff.” Id. at 762, 411 S.E.2d at 201–02. On appeal, we held
that the admission of the Medicare payments and contractual
-48-
write-offs, which we referred to as “gratuitous government
benefits,” was prejudicial and in violation of the rule. Id. at
764, 411 S.E.2d at 203.
In this case, unlike Badgett, the hospital bills were not
paid by an independent third party. There is no evidence in the
record that Medicare, Medicaid, some other insurance company, a
beneficial society, Plaintiff’s family, or Plaintiff’s employer
paid a portion of the decedent’s medical bills and/or procured
the write-offs. Rather, the bills appear to have been forgiven
by the hospital of its own accord as a business loss. In an
affidavit obtained by Defendant and not admitted into evidence,20
the hospital’s custodian of records characterized the unpaid
medical bills as “‘[r]isk [m]anagement’ write-offs,” which “were
not paid by any source (including the patient or insurance
company).” In addition, the evidence in the record indicates
that the hospital was also a defendant in a separate suit
brought by Plaintiff arising out of the same facts. The hospital
ultimately settled that lawsuit, and the amount of that
settlement was applied to reduce Plaintiff’s verdict in this
case.
20
Defendant submitted the affidavit to the trial court as an
offer of proof, however.
-49-
We can find no cases in this jurisdiction directly
addressing the situation in which a defendant doctor in a
medical malpractice case attempts to introduce evidence that a
hospital, which has settled with the plaintiff in a separate
action arising from the same facts, reduced the plaintiff’s
medical bills pursuant to “risk management” practices and not
pursuant to a contract with a government entity like Medicare or
with some other insurance company. Moreover, we have been unable
to find any cases from other jurisdictions dealing with this
particular, narrow factual scenario. Nevertheless, a number of
courts have held, like Badgett, that the costs written off by a
contract between a non-tortfeasor hospital and a government-
funded assistance program like Medicare are not admissible under
the collateral source rule. See, e.g., Pipkins v. TA Operating
Corp., 466 F. Supp. 2d 1255 (D.N.M. 2006) (holding that the
collateral source rule applied to contractual Medicare write-
offs made by the injured plaintiff’s health care provider). When
the hospital is a separate tortfeasor and writes off medical
expenses pursuant to an agreement with a third party, however,
other courts have concluded that the collateral source rule is
not applicable. See, e.g., Rose v. Via Christi Health Sys., Inc.
/ St. Francis Campus, 279 Kan. 523, 529, 113 P.3d 241, 246
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(2005) (“Under the facts of this case, the source of the
$154,000 of medical services not reimbursed by Medicare was [the
hospital], the tortfeasor, not an independent source.”);
Williamson v. St. Francis Med. Ctr., Inc., 559 So.2d 929, 934
(La. App. 2 Cir. 1990) (holding that the collateral source rule
did not apply to allow the plaintiffs to recover medical bills
cancelled by the hospital pursuant to an agreement with Medicare
because “the hospital, to whom the bill was owed, was also a
tort[]feasor” and, therefore, the benefit to the plaintiffs
resulted from the hospital’s own “procuration or contribution”).
Here, the record does not indicate that the decedent’s
medical bills were written off pursuant to an agreement with an
independent party. Rather, they were discharged by the hospital,
also an alleged tortfeasor, which ultimately settled with
Plaintiff. Unlike Badgett, the paying party in this case was not
independent and not collateral to this matter. The payment was
made by a separate, alleged tortfeasor and not pursuant to an
agreement with a separate, collateral source. Therefore, we hold
that the collateral source rule is not applicable to bar
evidence of the hospital bills that were written off by the
Cumberland County Hospital System. Accordingly, Plaintiff was
entitled to introduce evidence of the decedent’s medical bills,
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but Defendant was also entitled to introduce evidence that some
of those bills were written off by the hospital. As a result, we
hold that the trial court erred in denying Defendant’s motion to
introduce evidence of the write-offs and, therefore, abused its
discretion in denying her Rule 60(b) motion for a new trial as
it relates to the issue of damages.21 See generally Sink v.
Easter, 288 N.C. 183, 198, 217 S.E.2d 532, 541 (1975) (“[A]
motion for relief under Rule 60(b) is addressed to the sound
discretion of the trial court[,] and appellate review is limited
to determining whether the court abused its discretion.”).
III. Instruction on Permanent Injury
Though we have already determined that Defendant is
entitled to a new trial on damages, we address Defendant’s
argument that the trial court erred by instructing the jury on
“permanent injury” in the interests of judicial economy and for
the purpose of avoiding further appeal regarding the propriety
of the trial court’s jury instructions on damages. Defendant
contends that the trial court erred by instructing on permanent
injury because the purpose of the permanent injury jury
21
For the reasons discussed in the foregoing sections, we hold
that the trial court did not otherwise abuse its discretion in
failing to grant Plaintiffs’ motions for remittitur and for a
new trial.
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instruction “is to guide the jury in how it should determine the
value of future damages [to the injured party] at the time of
trial” and the decedent was not alive at that time. (Emphasis
added). In response, Plaintiff asserts that the instruction was
proper because it was “abundantly clear” from the evidence that
Plaintiff was only seeking damages for the decedent’s personal
injuries and his own loss of consortium, not for the decedent’s
life expectancy. We agree with Defendant.
As a preliminary matter, we note that Plaintiff brought no
action for wrongful death. Therefore, the trial court’s
permanent injury instruction was only relevant to Plaintiff’s
actions seeking personal injury damages. In that context, the
trial court instructed on permanent injury, in near word-for-
word compliance with our pattern jury instructions, as follows:
Damages for personal injury also include
fair compensation for permanent injury
incurred by the plaintiff as a proximate
result of the negligence of the defendant.
An injury is permanent when any of its
effects continued throughout the plaintiff’s
life. These effects may include medical
expenses, pain and suffering, scarring and
disfigurement, partial loss of use of part
of the body incurred or experienced by the
plaintiff over her life expectancy.
Once again, however, the plaintiff is not
entitled to recover twice for the same
element of damages; therefore, you should
not include any amount you’ve already
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allowed for medical expenses, pain and
suffering, and scarring or disfigurement or
partial loss of use of part of the body
because of permanent injury.
Life expectancy is the period of time the
plaintiff may reasonably have been expected
to live.
After its definition of life expectancy, the trial court moved
on to a discussion of negligence. The trial court omitted the
following additional language from our pattern jury
instructions:
[The life expectancy tables are in
evidence.] [The court has taken judicial
notice of the life expectancy tables.] They
show that for someone of the plaintiff’s
present age, (state present age), his life
expectancy is (state expectancy) years.
In determining the plaintiff’s life
expectancy, you will consider not only these
tables, but also all other evidence as to
his health, his constitution and his habits.
N.C.P.I. — Civil 810.14 (June 2012) (emphasis in original).
Beyond the alternative sentences set off in brackets, our
pattern jury instructions do not indicate that the omitted text
is optional. Though the charge conference does not disclose the
court’s rationale for omitting this text, the likely reason is
that the decedent was not alive at the time of trial. It is
entirely nonsensical to admit life expectancy tables and
thereafter instruct the jury on the decedent’s life expectancy
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when she is no longer living and no claim for wrongful death is
being brought. The omitted language reveals, therefore, that the
permanent injury jury instruction, in the context of Plaintiff’s
actions for personal injury damages, is not intended to cover
past damages. Past damages can be addressed, as they were in
this case, by instructions on other forms of damages. The
purpose of the permanent injury instruction, however, is to
compensate the plaintiff for additional future harm that she is
expected to experience because of a permanent injury that she
suffered as a proximate result of the defendant’s conduct. See
generally David A. Logan & Wayne A. Logan, North Carolina Torts
182 (1996) (“Plaintiffs are entitled to recover for the future
damages associated with permanent injuries.”) (emphasis added);
William S. Haynes, North Carolina Tort Law 907–08 (1989) (“The
term ‘permanent injuries,’ may be defined as those injuries that
are reasonably certain to be followed by permanent impairment to
earn money, or producing permanent and irremediable pain. . . .
Damages for permanent disability are, therefore, addressed in
the elements of damage referred to as loss of future earning
capacity or future pain and suffering, as opposed to being
recoverable in and of themselves. It logically follows that
where permanent injuries exist the proper element of damages
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into which such injuries fall are a permanent impairment or
diminution of the plaintiff’s earning ability or power.”). In
light of the fact that the decedent was not alive at the time of
the trial and Plaintiff did not bring suit for wrongful death,
we conclude that the trial court’s instruction on permanent
injury was erroneous.
Conclusion
For the foregoing reasons, we find no error in the trial of
this case on the negligence issues. We remand for a new trial on
damages.
NO ERROR in part; NEW TRIAL on damages.
Judges BRYANT and DILLON concur.