Fye v. Kennedy

COURT OF APPEALS OF TENNESSEE

AT KNOXVILLE FILED
June 26, 1998

EDWARD FYE, individually and ) C/A NO. 03A01-9707-CV-00287 Jr.
Cecil Crowson,
as husband of the deceased, ) Appellate C ourt Clerk
BARBARA MAY FYE, )
)
Plaintiff-Appellant, )
)
)
) APPEAL AS OF RIGHT FROM THE
v. ) HAMILTON COUNTY CIRCUIT COURT
)
)
)
)
ANNE D. KENNEDY and )
JAMES D. KENNEDY, III, )
) HONORABLE SAMUEL H. PAYNE,
Defendants-Appellees.) JUDGE

For Appellant For Appellees

C. MARK WARREN SAMUEL R. ANDERSON
Duncan, Mosley & Warren E. MATTIAS JANNERBO
Chattanooga, Tennessee Luther-Anderson, PLLP
Chattanooga, Tennessee

CAROL A. MUTTER
Lookout Mountain, Tennessee

O P I N IO N

VACATED IN PART
AFFIRMED IN PART
REMANDED FOR NEW TRIAL Susano, J.

1
 This is a wrongful death and loss of services action

that arose out of a two-vehicle accident. Following the second

of two jury trials, the trial court, acting pursuant to Rule 50,

Tenn.R.Civ.P., set aside the jury’s verdict for the plaintiff,

Edward Fye, and directed the entry of a judgment for the

remaining defendants, Anne D. Kennedy and James D. Kennedy, III.1

Plaintiff appealed, raising two issues:

1. Did the trial court err in granting the
Kennedys a directed verdict?

2. Did the trial judge who presided over the
first trial improperly limit the percentage
of fault that could be assessed to the
Kennedys in the second jury trial?

The Kennedys argue, by way of a separate issue, that the “trial

court improperly applied the collateral source rule in

determining the amount of damages to which plaintiff was

entitled.”

I.

This case finds its genesis in an April 30, 1991,

accident involving a vehicle driven by the defendant Anne D.

Kennedy (“Kennedy”) -- in which vehicle the plaintiff’s decedent,

Barbara May Fye (“Fye”), was riding as a guest passenger -- and a

vehicle driven by Jeffrey W. Keller (“Keller”). Just prior to

the accident, Kennedy was proceeding east in the left through-

traffic lane of 23rd Street in Hamilton County, approaching the

1
The Kennedys moved for a directed verdict at the conclusion of the
plaintiff’s proof and again at the close of all the proof. They renewed their
motion after the jury returned its verdict.

2
intersection of 4th Avenue. At the same time, Keller was

proceeding west on 23rd Street. As Keller approached the

intersection, he moved his vehicle to the middle or turn lane of

23rd Street, intending to turn left onto 4th Avenue. 23rd Street

has two lanes for traffic proceeding east and two lanes for

traffic moving west. The through-traffic lanes are separated by

a middle or turn lane. As Keller was turning left, his Chevrolet

Blazer was struck in the right front quarter panel by the front

of Kennedy’s 1988 Chevrolet Suburban. As a result of the

collision, Fye was seriously injured. She was hospitalized in

the intensive care unit of Erlanger Medical Center, where she

remained for just short of six months. She died from her

injuries on October 20, 1991.

The plaintiff brought suit for his wife’s wrongful

death and for loss of services. In addition to Kennedy and

Keller, the plaintiff named as defendants, (1) the owners of the

two vehicles, (2) General Motors Corporation, and (3) Newton

Chevrolet-GEO, Inc. The latter two defendants were sued on a

number of theories, all of which were related to the plaintiff’s

contention that Fye’s seat belt was defectively designed. The

plaintiff claimed that Fye’s injuries were enhanced because of

the defectively-designed seat belt.

Prior to trial, Keller and his father settled their

liability to the plaintiff for $1,500,000,2 and they were

dismissed as defendants. Thereafter, the remaining claims

proceeded to trial. Following a ten-day trial, the jury

2
Neither of the juries in this case was made aware of the fact that the
case against the Kellers had been settled.

3
exonerated General Motors Corporation and Newton Chevrolet-GEO,

Inc. On the verdict form, the jury reported that it found

Kennedy, Keller, and Fye each guilty of negligence that was a

proximate cause of the accident and Fye’s injuries and death.3

It found4 the parties fault as follows:

Kennedy 1%
Keller 90
Fye 9

Damages in the wrongful death case, without regard to fault, were

set at $1,505,750. The loss of services claim was valued at

$500,000.

On post-trial motion, the trial judge, the Honorable

William M. Barker, stated that while he could and would approve

the jury’s verdict with respect to damages, he could not agree

with the jury’s determination that Fye was guilty of actionable

negligence. He stated that he did not believe she was guilty of

any negligence, much less 9%. He opined that he was satisfied

with the jury’s finding with respect to the fault of Keller.

After an extended discussion among counsel and the court, Judge

Barker ordered a new trial solely on liability, but set limits on

the re-trial:

3
With respect to Fye, the jury simply found that she was guilty of
negligence that proximately caused her injuries.
4
The jury originally reported fault as follows: Kennedy 0%, Keller 90%,
and Fye 10%. The trial judge found that the allocation of zero fault to
Kennedy was inconsistent with the jury’s finding that Kennedy was guilty of
negligence that proximately caused the accident. He directed the jury to
retire for further deliberations. One minute later, the jury returned and
announced its revised verdict, which was accepted by the court.

4
 Now, here’s what I’m going to do, and I know
that there is no authority for this, but I
also know there’s no authority against it. I
am going to direct that there be a new trial
as between Mrs. Fye’s estate and the
Defendant Anne Kennedy and her husband James
D. Kennedy, and the new trial will be
limited. There will not be a new trial with
regard to the total amount of the damage
award assigned by the former jury....

Two, the jury will not be told of the prior
allocation of fault for this accident as
between Mr. Keller and the Kennedys.
However, once the jury verdict is accepted
and rendered, the previous Jury’s finding of
90 percent of the fault as to Mr. Keller will
be written into their verdict, so that the
Kennedys will be exposed in a new trial to
only a reconsideration of whether their fault
was zero percent or up to 10 percent.

That is to say, a jury hearing this second
trial may assign 60 percent of the fault to
the Kellers and 40 percent to the Kennedys.
If that’s the case, the Kennedys will be
liable for 10 percent of the damages
previously determined. The jury may find 95
percent of the fault against the Kellers, and
only 5 percent against the Kennedys. That
being the case, the Kennedys would pay 5
percent of those damages.

Now, I’m doing that because I simply feel
that without any law on the subject, that’s
just and that’s fair. I do agree with the
defense that to reexamine all of the
allocation of fault between the negligent
defendants or negligence-charged defendants
would be giving the Plaintiff too much of a
bite at the apple again.

The issue of Fye’s negligence was not to be presented for

resolution to the second jury, for the simple reason that the

Kennedys, who were then the only remaining defendants in the

case, had never claimed that Fye was guilty of any negligence.

Fye’s alleged negligence was “in play” at the first trial only

because the defectively-designed-seat-belt defendants had claimed

that Fye had improperly fastened her seat belt. With the seat

5
belt issue out of the second trial,5 there was to be no testimony

presented to the second jury regarding Fye’s use or misuse of her

seat belt. See T.C.A. § 55-9-604(a).

At the second trial, the Honorable Samuel H. Payne

presided. Following a two-day trial solely on the issue of the

liability/comparative fault of Kennedy and Keller, the jury found

both guilty of actionable negligence and assigned 60% of the

fault to Keller and 40% to Kennedy. Coincidentally, this was one

of the hypothetical scenarios that had been used by Judge Barker

when he explained how the mechanism he had set in place would be

applied to ensure that Kennedy would not, under any

circumstances, be assigned more than 10% fault.

Kennedy pursued her motion for a directed verdict

following the entry of the judgment confirming the second jury’s

verdict. As previously indicated, Judge Payne granted the

motion, finding that reasonable minds could only conclude that

Kennedy was not guilty of any negligence that proximately caused

or contributed to the accident and Fye’s injuries and death. He

concluded that Keller’s act of turning in front of Kennedy was

the sole proximate cause of the accident. Judge Payne stated on

the record, and confirmed in his subsequently-entered order that

[s]hould the directed verdict for these
defendants be vacated or reversed on appeal,
the Court conditionally grants pursuant to
Rules 50.03 and 59 of the Tennessee Rules of
Civil Procedure the alternative Motion of
Defendants Anne D. and James D. Kennedy, III,

5
The plaintiff did not question the dismissal of General Motors
Corporation and the dealer.

6
 for a New Trial. The Court finds in the
alternative, upon review of the evidence,
that the evidence preponderates against the
verdict of the jury and that if the judgment
in favor of the defendants James D. Kennedy,
III and Anne Kennedy is reversed on appeal, a
new trial should be granted these defendants.

II.

We review a directed verdict under well-established

rules:

In ruling on the motion, the court must take
the strongest legitimate view of the evidence
in favor of the non-moving party. In other
words, the court must remove any conflict in
the evidence by construing it in the light
most favorable to the non-movant and
discarding all countervailing evidence. The
court may grant the motion only if, after
assessing the evidence according to the
foregoing standards, it determines that
reasonable minds could not differ as to the
conclusions to be drawn from the evidence.
Sauls v. Evans, 635 S.W.2d 377 (Tenn. 1982);
Holmes v. Wilson, 551 S.W.2d 682 (Tenn.
1977). If there is any doubt as to the
proper conclusions to be drawn from the
evidence, the motion must be denied.
Crosslin v. Alsup, 594 S.W.2d 379 (Tenn.
1980).

Eaton v. McLain, 891 S.W.2d 587, 590 (Tenn. 1994). See also

Williams v. Brown, 860 S.W.2d 854, 857 (Tenn. 1993).

“Negligence is ordinarily an issue to be decided by a

jury, and can be withdrawn from the jury only in those cases

where the facts are established by evidence free from conflict

and the inference from the facts is so certain that all

reasonable minds must agree.” Id.

7
 “There can be more than one proximate cause of an

injury.” Stokes v. Leung, 651 S.W.2d 704, 708 (Tenn.App. 1982).

See also Kelley v. Johnson, 796 S.W.2d 155, 159 (Tenn.App. 1990).

Generally speaking, whether a party breached a duty and

whether that breach proximately caused injury “are...questions

decided by the trier of fact.” Id. at 157. “These questions

become questions of law only when the facts and inferences drawn

from the facts permit reasonable persons to reach only one

conclusion.” Id.

III.

The court charged the jury with respect to the

plaintiff’s allegations that Kennedy was guilty of common law

negligence in failing to use reasonable care, in failing to have

her vehicle under proper control, in failing to keep a proper

lookout “for traffic on the street,” in driving at an excessive

rate of speed for the conditions then existing on the highway,

and in failing to “observe traffic signals and respond

appropriately.” It also charged the jury with respect to T.C.A.

§ 55-8-1106 and T.C.A. § 55-8-129.7

6
T.C.A. § 55-8-110 provides, in pertinent part, as follows:

Whenever traffic is controlled by traffic-control
signals exhibiting the words “Go,” “Caution” or
“Stop,” or exhibiting different colored lights
successively one (1) at a time, or with arrows, the
following colors only shall be used and the terms and
lights shall indicate and apply to drivers or vehicles
and pedestrians as follows:

* * *

(2) Yellow alone or “Caution,” when shown following
the green or “Go” signal:

8
 IV.

On the subject of Kennedy’s negligence, the most

critical witness was George Donald Harris. He testified that

just prior to the accident he was proceeding east in the right

through-traffic lane of 23rd Street. When he reached a point

that he estimated was 60 to 80 feet8 from the solid white line

for stopped vehicles at the 4th Avenue intersection, the light

changed from green to yellow. He was then traveling at 30-35

MPH. When the light changed, he put his foot on the brake -- “it

took very little breaking to stop” -- and pulled off to the right

in a vacant Exxon station. He stopped his car before reaching

the intersection.

Less than a second after the light turned from green to

yellow, Kennedy’s Suburban “immediately” came into Harris’ view

to his left in the left through-traffic lane. He estimated that

the Kennedy vehicle was 5 to 10 feet behind him when the light

changed to yellow. He testified that Kennedy was going 40 to 45

(A) Vehicular traffic facing the signal is thereby
warned that the red or “Stop” signal will be exhibited
immediately thereafter and such vehicular traffic
shall not enter or cross the intersection when the red
or “Stop” signal is exhibited;...
7
T.C.A. § 55-8-129 provides, in pertinent part, as follows:

The driver of a vehicle within an intersection
intending to turn to the left shall yield the right-
of-way to any vehicle approaching from the opposite
direction which is within the intersection or so close
thereto as to constitute an immediate hazard, but the
driver, having so yielded and having given a signal
when and as required by this chapter, may make such
left turn, and the drivers of all other vehicles
approaching the intersection from the opposite
direction shall yield the right-of-way to the vehicle
making the left turn.
8
Harris testified at an earlier time that he was 60 feet from the cross
walk when the light turned to yellow.

9
MPH. He saw no indication that Kennedy was going to stop, does

not remember seeing any brake lights on Kennedy’s vehicle, and

did not detect that her speed was increasing or decreasing.

Harris said that he saw Keller’s Blazer turning left in

the intersection, and that it was moving when he first noticed

it. Harris further testified that it was approximately 2 to 3

seconds from the time the light changed to yellow until the

moment of impact.

The speed limit on 23rd Street at the site of the

accident was 40 MPH. There was evidence from which one could

conclude that 23rd Street and 4th Avenue is, generally speaking,

a busy intersection. The accident occurred at approximately 3:15

p.m.

Another witness, Ms. McLaughlin, was in a vehicle to

the rear of Keller’s Blazer and in the same lane of traffic. She

testified that the Blazer was at a complete stop out in the

intersection -- past the solid white line -- when the light

changed from yellow to red. According to her, when the light

turned to red, Keller started his turn to the left. The “very

instant” Keller turned to the left, he was hit by Kennedy’s

vehicle.

When the light turned red for Keller, it also turned

red for Kennedy.

10
 Keller testified that he was one-half to two-thirds of

the way through the arc of his turn when he was struck by Kennedy

in the right front part of his vehicle.

Kennedy testified that the accident occurred at “3:15,

3:17.” She was taking her triplets, age 4,9 to a doctor’s

appointment. One of the children’s appointment was at 3:15,

while the other children were due to see the doctor at 3:30. At

the time of the accident, Kennedy was still some distance from

the doctor’s office.

Kennedy testified that she never saw the light change

from green to yellow.

Admittedly, there is evidence from which one could

conclude that Kennedy was not guilty of negligence that

proximately caused or contributed to the accident; but we cannot

consider this evidence on the question of whether the trial court

erred in directing a verdict for the defendants Kennedy. As we

are required to do, we have discarded all of this countervailing

evidence in connection with our analysis of the trial judge’s

decision to grant a directed verdict.

We find that reasonable minds could reach different

conclusions as to whether Kennedy was guilty of actionable

negligence. There is evidence from which the jury could

reasonably conclude: that Kennedy was traveling at an excessive

9
Fye was the triplets’ “nanny.” One of the triplets was in the front
seat next to Kennedy while the other two were in the second seat on either
side of Fye. Apparently, the children were not injured in the accident.

11
rate of speed as she approached this particular intersection;

that, for whatever reason, she did not see the light go from

green to yellow; that she was in a hurry to make the children’s

appointments; that, except for her excessive speed, she could

have braked in time to stop before reaching the intersection, as

did Harris; and that she was generally not proceeding in a safe

manner as she was required to do. We find that the plaintiff’s

case made out a jury question on the issue of Kennedy’s

negligence and whether that negligence was a proximate cause of

the accident. We find and hold that the trial court erred in

directing a verdict for the Kennedys.

The trial judge at the second trial, in his role as the

thirteenth juror, concluded that he could not approve the

verdict. He stated that if he were in error in directing a

verdict, he would grant a new trial. In view of this holding, we

are compelled to remand this case for a new trial. See Rule

50.03, Tenn.R.Civ.P. See also Huskey v. Crisp, 865 S.W.2d 451,

454-55 (Tenn. 1993). We do not believe that this is an

appropriate case to exercise our discretionary power, see Rule

50.03, to vacate the trial court’s conditional grant of a new

trial, in favor of reinstating the verdict of the second jury.

We do not find the “exceptional circumstances” required to

justify such a result. See Huskey, 865 S.W.2d at 455.

V.

We now turn our attention to the appellant’s second

issue, i.e., whether the trial court erred when it capped

12
Kennedy’s fault at 10%, regardless of what a subsequent jury

concluded was an appropriate allocation of fault between Kennedy

and the non-party, Keller. In reaching this issue, we recognize

that the third trial may render this issue moot. This, of

course, would be the case if the third jury were to conclude that

Kennedy was not guilty of any legally cognizable fault; but, as

it stands now, Judge Barker’s ruling is a part of the law of this

case. For this reason, we believe the parties are entitled to

appellate review of this ruling at this time.

Judge Barker reasoned that it was not fair to Kennedy

to reopen the issue of the non-party Keller’s fault. Since he

agreed that Keller was at least 90% at fault, he felt that it was

fair to the parties to “lock[] [that determination] in concrete.”

Acting as the thirteenth juror, Judge Barker approved the jury’s

verdict in three particulars: as to Keller’s comparative fault;

as to the suit against the two defendants dismissed as a result

of the verdict; and as to the issue of damages. He reasoned that

the allocation of fault to Fye -- with which he adamantly

disagreed -- adversely affected only 10% of the fault equation.

He saw no need to reopen the entire question of comparative

fault, since, in his judgment, the bulk of the jury verdict was

clearly sustained by the preponderance of the evidence.

It is not uncommon for a trial judge to approve a

jury’s assessment of damages, while disagreeing with its verdict

as to liability. In such cases, the court would, as Judge Barker

did, refuse to grant a new trial as to damages but grant a new

trial as to liability. Pre-McIntyre, it was clear that a trial

13
court could grant a new trial as to one party’s claim while

denying a new trial as to another party’s claim.10 See, e.g.,

Nashville Street Railway Co. v. Gore, 106 Tenn. 390, 61 S.W. 777

(1901). See also Lee v. Melson, 387 S.W.2d 838 (Tenn.App. 1964).

In Lee, this court made the following comment in justifying just

such a ruling:

The guiding principle is fairness to both
parties. A verdict tainted with error or
confusion ought not to stand. On the other
hand, the parties are entitled to only one
day in court. Once a party has been accorded
a fair trial on the merits, unaffected by
errors of law, he is not entitled to another
trial merely because another party to the
suit has been granted a new trial to reverse
an error peculiar to him.

Id. at 841. This court’s comments in Lee could be applied with

equal force here. The plaintiff in the instant case had a full

and fair hearing as to Keller’s percentage of fault. The trial

court approved the jury’s determination in that regard. Why

should the plaintiff be entitled to a new trial -- another “bite

at the apple” -- as to that determination? Judge Barker’s

approach is reasonable and fair to both parties. It is actually

more than fair to the plaintiff -- it gives him an opportunity to

persuade the jury to increase Kennedy’s fault from 1%, as found

by the first jury, to 10%, a tenfold increase.

Other states have permitted a trial court to “tinker”

with a jury’s allocation of fault. See Caldwell v. Piggly-Wiggly

Madison Co., 32 Wis.2d 447, 145 N.W.2d 745 (1966); McHaffie v.

10
This would still be the case today, absent any complicating issues of
comparative fault.

14
Bunch, 891 S.W.2d 822 (Mo.banc 1995); Kibbons v. Union Electric

Company, 823 S.W.2d 485 (Mo.banc 1992).

Having said all of this, we hasten to note that

subsequent to Judge Barker’s ruling, the Supreme Court released

its opinion in the case of Turner v. Jordan, 957 S.W.2d 815

(Tenn. 1997). In Turner, the Supreme Court held

that the trial court may not reallocate the
comparative fault after weighing the evidence
as the thirteenth juror, but must instead
grant a new trial.

Id. at 824. We recognize that the facts in Turner are in no way

similar to the facts of the instant case. Furthermore, we have

already expressed our opinion that the trial judge’s ruling in

the instant case capping Kennedy’s fault at 10% is a fair and

reasonable solution to a difficult and unusual situation. We

also recognize that the ruling in Turner is obiter dictum, in

that the Supreme Court expressly acknowledged that, in deciding

Turner, it did not have to reach the issue of a trial court’s

power to reallocate fault following a jury verdict. However, we

feel bound by Turner in view of the fact the Supreme Court

granted permission to appeal on this specific issue, see id. at

816, and in view of the absolute nature of the court’s

pronouncement on the subject at hand. Id. at 824. See also

Holder v. Tennessee Judicial Selection Commission, 937 S.W.2d

877, 882 (Tenn. 1996) (“Accordingly, inferior courts are not free

to disregard, on the basis that the statement is obiter dictum,

the pronouncement of a superior court when it speaks directly on

15
the matter before it, particularly when the superior court seeks

to give guidance to the bench and bar.”)

We cannot escape the conclusion that Judge Barker’s

ruling, authorizing as it did and still does, a possible increase

in the jury’s allocation of fault to Kennedy from 1% to 10%, is

clearly a change -- a reallocation as it were -- of the jury’s

assessment of Kennedy’s fault. The first jury said 1%; Judge

Barker said it could “float” from 0% to 10%. The jury at the

second trial assessed Kennedy’s fault at 40%; had Judge Payne

approved the verdict and applied Judge Barker’s ruling, Kennedy’s

fault would have decreased, without the second jury’s approval,

from 40% to 10%. It should also be noted that under Judge

Barker’s ruling, any jury verdict assessing less than 10% fault

to Kennedy would mean that the total fault finally assessed in

the case would be less than 100%. For example, if a jury were to

find that Kennedy was 5% at fault, Judge Barker’s earlier ruling

would confirm such a finding. In this situation, 95% of fault --

90% to Keller in the first trial and 5% to Kennedy -- would be

allocated with 5% fault unallocated. Such a judgment is contrary

to McIntyre’s edict that 100% of fault be set by the jury.

We believe that Turner precludes even a partial

reallocation of a jury’s finding as to comparative fault. Under

Turner, a trial judge, who, in his or her role as the thirteenth

juror, cannot approve some part of the jury’s determination with

respect to comparative fault is limited to granting a new trial.

Accordingly, we vacate so much of Judge Barker’s ruling below as

16
permits the trial court, on retrial, to reallocate the fault

found by the third jury.

VI.

In the first trial, Judge Barker permitted the

plaintiff to prove a bill from Erlanger Medical Center in the

amount of $748,384.08. The Kennedys strenuously argue that this

was error. They contend that the plaintiff should have been

limited to proving $75,264, the portion of the bill actually paid

by Medicaid.

Judge Barker addressed this issue both before and after

the first trial. On the latter occasion, he reaffirmed his

earlier ruling. He stated that if he were in error in admitting

the entire bill, he would have to conclude that the jury’s

determination of $1,505,750 for the wrongful death claim was

contrary to the preponderance of the evidence; in which event he

would grant a new trial. See Rule 50.03, Tenn.R.Civ.P. In view

of Judge Barker’s contingent grant of a new trial, we will now

address this issue.

As presented to the trial court, the relevant facts are

these. Erlanger Medical Center rendered a bill to the Fye estate

for $748,384.08, representing the total of the charges made by

the hospital for the six months that Fye was in its intensive

care unit.11 At some unspecified point thereafter, the hospital

submitted this bill to Medicaid and received payment in the

11
Contrary to Judge Goddard’s statement in his separate opinion, all of
Erlanger’s charges that were presented to the jury were incurred by Fye; it was
only after they had been incurred that a portion of the total bill was forgiven.

17
amount of $75,264. The parties agree that the hospital was not

under any legal compulsion to submit the bill to Medicaid; but it

is clear that the hospital chose to do so. The parties

represented to the court that the bill was submitted to Medicaid

with the understanding that the hospital would accept the amount

tendered by Medicaid, and would not seek to recover the balance

of the bill -- $673,120.08 -- from Fye’s estate, her husband, or

any other source. While the parties did not and do not present

any statutory, regulatory, or contractual basis for this

forbearance, it is clear, under the parties’ stipulation, that

the balance of the bill was, in some way, legally forgiven. The

issue for us is whether, since the balance of the bill was

forgiven, the plaintiff is entitled to recover the fair value of

the services rendered as opposed to the actual amount paid by

Medicaid. The parties agree that Medicaid was subrogated to the

amount paid by it and was in fact paid by the plaintiff,

apparently out of the proceeds of the settlement with the

Kellers.

We are unaware of any authority in Tennessee on facts

similar to those in this case. The Kennedys argue that, because

$673,120.08 of the bill was forgiven before trial, we should

treat the forgiven portion as no bill at all rather than as an

expense satisfied from a collateral source. We disagree. We

believe the forgiveness of the bill should be analyzed in the

context of the collateral source rule.

Under the provisions of T.C.A. § 20-5-113, a claimant

in a wrongful death action is entitled to recover, among other

things, the “necessary expenses resulting to the deceased from

18
the personal injuries...” The Supreme Court has stated that “the

[wrongful death statutes], in theory, preserve the right of

action which the deceased would have had,” if he or she had

survived. Jones v. Black, 539 S.W.2d 123 (Tenn. 1976). It

follows that a claimant seeking to recover for the wrongful death

of another is entitled to recover the “reasonable and necessary

expenses for medical care, services, and supplies actually given

in the treatment of [the deceased] as shown by the evidence.”

See T.P.I. 3 - CIVIL 14.11.

An injured party’s right to recover his or her

“reasonable and necessary expenses” must be viewed in connection

with the collateral source rule:

Normally, of course, in an action for damages
in tort, the fact that the plaintiff has
received payments from a collateral source,
other than the defendant, is not admissible
in evidence and does not reduce or mitigate
the defendant’s liability.

Donnell v. Donnell, 415 S.W.2d 127, 134 (Tenn. 1967). See also

Steele v. Ft. Sanders Anesthesia Group, P.C., 897 S.W.2d 270, 282

(Tenn.App. 1994).

The subject before us is addressed in RESTATEMENT (SECOND )

OF TORTS (1977) § 920A, which we adopt:

§ 920A. Effect of Payments Made to Injured
Party

(1) A payment made by a tortfeasor or by a
person acting for him to a person whom he has
injured is credited against his tort
liability, as are payments made by another

19
 who is, or believes he is, subject to the
same tort liability.

(2) Payments made to or benefits conferred on
the injured party from other sources are not
credited against the tortfeasor’s liability,
although they cover all or a part of the harm
for which the tortfeasor is liable.

Emphasis added. Subsection (2) of § 920A is explained in the

comments:

b. Benefits from collateral sources.
Payments made or benefits conferred by other
sources are known as collateral-source
benefits. They do not have the effect of
reducing the recovery against the defendant.
The injured party’s net loss may have been
reduced correspondingly, and to the extent
that the defendant is required to pay the
total amount there may be a double
compensation for a part of the plaintiff’s
injury. But it is the position of the law
that a benefit that is directed to the
injured party should not be shifted so as to
become a windfall for the tortfeasor....If
the benefit was a gift to the plaintiff from
a third party or established for him by law,
he should not be deprived of the advantage
that it confers. The law does not
differentiate between the nature of the
benefits, so long as they did not come from
the defendant or a person acting for him.
One way of stating this conclusion is to say
that it is the tortfeasor’s responsibility to
compensate for all harm that he causes, not
confined to the net loss that the injured
party receives....

Perhaps there is an element of punishment of
the wrongdoer involved. (See § 901).
Perhaps also this is regarded as a means of
helping to make the compensation more nearly
compensatory to the injured party. (Cf. §
914A, Comment b).

c. The rule that collateral benefits are not
subtracted from the plaintiff’s recovery
applies to the following types of benefits:

* * *

20
 (3) Gratuities. This applies to cash
gratuities and to the rendering of services.
Thus the fact that the doctor did not charge
for his services or the plaintiff was treated
in a veterans hospital does not prevent his
recovery for the reasonable value of the
services.

(4) Social legislation benefits. Social
security benefits, welfare payments, pensions
under special retirement acts, all are
subject to the collateral-source rule.

* * *

In Bennett v. Haley, 132 Ga.App. 512, 208 S.E.2d 302

(1974), the Georgia Court of Appeals, quoting verbatim from 22

AM.JUR.2d Damages § 570 (1988), emphasized that gratuitous

benefits are covered by the collateral source rule:

[A]s a general rule, the fact that the
plaintiff received gratuitous medical care,
continued salary or wage payments, proceeds
from insurance policies, or welfare and
pension benefits, will not be taken into
account in computing damages.

208 S.E.2d at 310. To the same effect is Mitchell v. Moore, 406

So.2d 347, 351 (Ala. 1981).

In Banks v. Crowner, 694 P.2d 101 (Wyo. 1985), the

Supreme Court of Wyoming, relying upon the above-quoted section

of the RESTATEMENT , held that even assuming bills from a Veteran’s

Administration facility were for treatment “rendered

gratuitously,” an injured party suing in tort would be entitled

to prove “the reasonable value of the medical services necessary

to treat the injury.” Id. at 105.

21
 In Tennessee, the focus has always been on the

“reasonable” value of “necessary” services rendered. A plaintiff

must prove that the services rendered were “necessary” to treat

the injury or condition in question; and, even if the services

were necessary, that the charges in question were “reasonable.”

The collateral source rule precludes a defendant from attempting

to prove that a “reasonable” charge for a “necessary” service

actually rendered, has been, or will be, paid by another -- not

the defendant or someone acting on his or her behalf -- or has

been forgiven, or that the service has been gratuitously

rendered. However, a defendant is permitted to introduce

relevant evidence regarding necessity, reasonableness, and

whether a claimed service was actually rendered.

The theory underlying the collateral source ruling is

that a tortfeasor should be responsible for “all harm that he [or

she] causes.” § 920A, Comment b. In applying the collateral

source rule and the theory underlying it, there is no reason to

differentiate between a payment from a collateral source and a

gratuity from a collateral source. In either event, there is a

benefit to the injured party that “should not be shifted so as to

become a windfall for the tortfeasor.” Id.

In the instant case, the Kennedys tacitly concede that

six months of intensive care hospitalization was “necessary.”

There is no suggestion that the hospital bill for $748,384.08 is

other than “reasonable.” Therefore, it is clear that the bill is

for services actually rendered, that it represents charges for

“necessary” treatment, and that it is in a “reasonable” amount.

22
The jury was entitled to this evidence. It was not entitled to

know that the bill had been partially forgiven.

The judgment of the trial court directing a verdict for

the appellees Anne D. Kennedy and James D. Kennedy, III, is

hereby vacated. The judgment of the trial court limiting an

assessment of the Kennedys’ comparative fault to 10% is likewise

vacated. The trial court’s conditional grant of a new trial

solely on the issues of the Kennedys’ liability to the plaintiff

and the comparative fault of Kennedy and Keller is hereby

affirmed, as is the trial court’s decision regarding the bill

from Erlanger Medical Center. The issues for the jury in the

third trial will be the same as the ones in the second trial.

This case is remanded to the trial court for a new trial. Costs

on appeal are taxed to the appellees.

_____________________________
Charles D. Susano, Jr., J.

CONCUR:

________________________
Houston M. Goddard, P.J.

________________________
William H. Inman, Sr.J.

23
 C O U R T O F A P P E A L S O F T E N N E S S E E

A T K N O X V I L L E FILED
June 26, 1998

Cecil Crowson, Jr.
Appellate C ourt Clerk
E D W A R D F Y E , I n d i v i d u a l l y a n d )
a s h u s b a n d o f t h e d e c e a s e d , )
B A R B A R A M A Y F Y E )
)
P l a i n t i f f - A p p e l l a n t )
)
)
v . ) H A M I L T O N C O U N T Y
) 0 3 A 0 1 - 9 7 0 7 - C V - 0 0 2 8 7
)
A N N E D . K E N N E D Y a n d )
J A M E S D . K E N N E D Y , I I I )
)
D e f e n d a n t s - A p p e l l e e s )

O P I N I O N C O N C U R R I N G I N P A R T A N D D I S S E N T I N G I N P A R T

G o d d a r d , P . J .

I c o n c u r i n a l l o f t h e i s s u e s a d d r e s s e d i n t h e m a j o r i t y

o p i n i o n e x c e p t t h e o n e q u e s t i o n i n g t h e T r i a l C o u r t ' s p e r m i t t i n g

t h e P l a i n t i f f t o p r o v e t h e e n t i r e b i l l f r o m E r l a n g e r M e d i c a l

C e n t e r .

I r e c o g n i z e t h a t J u d g e S u s a n o h a s s e t o u t c o n s i d e r a b l e

a u t h o r i t y t o s u p p o r t t h e p o s i t i o n r e a c h e d b y t h e m a j o r i t y .

H o w e v e r , i t a p p e a r s t h i s i s a q u e s t i o n o f f i r s t i m p r e s s i o n i n

T e n n e s s e e a n d I c a n n o t c o n c u r t h a t t h e l a w s h o u l d e n a b l e a n

2 5
i n j u r e d p l a i n t i f f t o b e a b l e t o p r o v e a n d , p r e s u m a b l y , r e c o v e r

m o n e t a r y d a m a g e s f o r m e d i c a l e x p e n s e s w h i c h h e h a s i n f a c t n o t

i n c u r r e d , m u c h l e s s p a i d o r b e c a m e o b l i g a t e d t o p a y .

A s s u m e , f o r i n s t a n c e , t h a t i n t h e c a s e a t b a r t h e

d e c e a s e d h a d o n l y r e c e i v e d a r e l a t i v e l y m i n o r i n j u r y f r o m w h i c h

s h e f u l l y r e c o v e r e d . H o w e v e r , t h e c o s t o f h e r t r e a t m e n t a n d

c o n v a l e s c e n c e t o t a l e d $ 2 5 0 , 0 0 0 , b u t s h e w a s o n l y c h a r g e d a n d

o b l i g a t e d t o p a y t h e s u m o f $ 2 5 0 0 . W o u l d s h e t h e n b e e n t i t l e d t o

p r o v e t h e $ 2 5 0 , 0 0 0 a s a p a r t o f h e r d a m a g e s ? I t h i n k n o t . I n m y

v i e w , f u n d a m e n t a l f a i r n e s s r e q u i r e s a d i f f e r e n t r e s o l u t i o n t h a n

t h a t r e a c h e d b y t h e m a j o r i t y o p i n i o n .

I w o u l d h o l d t h a t t h e i n t r o d u c t i o n o f t h e E r l a n g e r

b i l l w a s p r e j u d i c i a l e r r o r a n d - - i n l i g h t o f J u d g e B a r k e r ' s

s t a t e m e n t r e l a t i v e t o g r a n t i n g a n e w t r i a l - - r e m a n d t h e c a s e f o r

t r i a l a s t o l i a b i l i t y a n d d a m a g e s , w h i c h w o u l d i n c l u d e o n l y t h o s e

m e d i c a l b i l l s w h i c h w e r e p a i d o r t h e r e w a s a n o b l i g a t i o n t o p a y .

_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
H o u s t o n M . G o d d a r d , P . J .

2 6