Tuesday, September 30, 2014
C.A. Rejects Bid for Increased Interest on Malpractice Judgment
Panel Says Interest Owed Only on Periodic Payments That Came Due During Appeal
By KENNETH OFGANG, Staff Writer
A defendant who unsuccessfully appeals a medical malpractice judgment that provides for periodic payments is liable for post-judgment interest on payments that came due while the appeal was pending, but not on the remainder of the judgment, the Court of Appeal for this district ruled yesterday.
Ruling on the fourth appeal in the case, Div. Four affirmed Los Angeles Superior Court Judge Laura A. Matz’s ruling that Verdugo Hills Hospital had fully satisfied the judgment awarded to Aidan Leung on the basis of a 2007 jury verdict.
Jurors found that the hospital and Dr. Steven Nishibayashi failed to provide Aidan’s parents sufficient warnings and information, and to diagnose and treat his condition, when he exhibited signs of neonatal jaundice shortly after his birth in 2003, resulting in severe brain damage and motor impairment.
The verdict was for approximately $14.8 million. But Matz granted the hospital’s request for a periodic payments judgment under Code of Civil Procedure Sec. 667.7, which provides an alternative method to pay future damages that exceed $50,000.
She also ordered the hospital to provide security for the payments, which will stretch out over 57 years, in the form of a bond from an admitted California surety, or an annuity from an approved list of companies, and ordered that Leung recover the judgment’s present value if the hospital failed to post the security.
In its first appeal, the hospital argued that the trial court erred in calculating the amount of the appeal bond on the full amount of the award, rather than only on the portion that might come due while the appeal was pending. The panel affirmed, reasoning that state law requires appeal bonds to be calculated based on lump sum present value in order to assure the entire judgment will not become uncollectible if the appellant becomes insolvent.
‘Law of the Case’
In the appeal ruled on yesterday, the plaintiff argued that as a result of the ruling on the first appeal, it was “the law of the case” that post-judgment interest, like the appeal bond, had to be calculated on the basis of the entire judgment amount, and that the hospital owed about $7.5 million in additional interest as a result.
But Justice Thomas L. Willhite Jr., in an unpublished opinion, said the two situations were not analogous and that the issue raised in the present appeal was not determined in the prior appeals, so the law-of-the-case doctrine does not apply.
The prior ruling, the justice said, “meant only that entry of a periodic payments judgment did not change the sum upon which an appeal bond would be calculated.”
“In sum, we reject plaintiff’s contention that Leung I held ‘that it was the present value judgment that was the effective judgment during the pendency of the appeal.’…It follows that the doctrine of law of case has no application to this appeal….Therefore, the trial court properly held that plaintiff was not entitled to additional post-judgment interest.”
Albert T. Liou of LKP Global Law and Stuart B. Esner of Esner, Chang & Boyer represented the plaintiff on appeal, while Stephen C. Fraser and Daniel K. Dik of Fraser, Watson & Croutch and Robert A. Olson and Feris M. Greenberger of Greines, Martin, Stein & Richland represented the defendant.
The case is Leung v. Verdugo Hills Hospital, B204908.
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