Tuesday, August 18, 2020
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California Supreme Court:
Statutory Damages Are Limited to $500 Per Lawsuit Against Nursing Homes
By Sandra Hong, Staff Writer
A nursing home is only liable for statutory damages up to $500 per lawsuit for breaching the Patients Bill of Rights or other laws or rules relating to the standard of care, no matter how many violations may have occurred, the California Supreme Court held yesterday.
The opinion by Justice Ming W. Chin reverses a decision of Div. Three of the Fourth District Court of Appeal which found HCR ManorCare, Inc. was liable for statutory damages based on the number of violations that a jury held the facility liable for under Health and Safety Code §1430(b).
Justice Eileen C. Moore wrote the opinion which rejected ManorCare’s argument that its liability was limited to $500 in statutory damages for the 382 violations which a jury found were established, remanding the case to the Riverside Superior Court to determine the amount of punitive damages.
John Jarman was 91 years old when he was admitted to a ManorCare facility in Hemet after undergoing hip surgery in March 2008. He filed a lawsuit in 2010 alleging that during his three-month stay he was neglected by staff, who ignored his calls for assistance and left him in soiled diapers.
His complaint included three causes of action: violation of the Patients Bill of Rights, elder abuse and neglect, and negligence. Jarman died before trial, and his daughter, Janice Jarman, stepped in as his successor in interest.
At trial, the jury awarded $100,000 on the negligence claim and $95,500 in damages under §1430 at $250 for each of the 382 violations. The jury also determined that ManorCare acted with “malice, oppression, or fraud,” allowing Janice Jarman to collect punitive damages.
The trial court struck the punitive damages claim based on sufficiency of evidence concerns.
In his majority opinion, from which two justices departed, Chin said Moore’s conclusion that the per-violation approach to applying §1430(b) “raised practical difficulties” and was not fully supported by a reading of the legislative intent behind the Long-Term Care, Health, Safety, and Security Act of 1973, which encompasses §1430(b).
“[M]any of the rights set out in the Patients Bill of Rights appear to overlap with one another, making it difficult to parse out what constitutes a separate and distinct violation for purposes of section 1430(b),” Chin wrote.
Various Rights
To illustrate, Chin cited various patient rights under multiple subsections of §72527, such as rights to “be treated with consideration, respect and full recognition of dignity,” “participate in activities of social, religious and community groups,” and “have visits from members of the clergy at any time.”
Chin asked:
“If a skilled nursing facility denied a resident’s request to receive a visit from a pastor or priest, would this denial constitute four separate violations of the right above, resulting in a $2000 award?”
He concluded:
“Given the range of rights secured by section 1430(b) and the difficulty of distinguishing a series of violations from a continuing violation, if seems fairly improbable that the Legislature intended the $500 cap to be applied in a sliding-scale fashion—with damages tied to the severity of the misconduct—as the dissent suggests.”
Statutory Language
The language of §1430(b) provides that a current or former patient of a skilled nursing facility “may bring a civil action against the licensee of a facility who violates any rights of the resident or patient as set forth in the Patients Bill of Rights...or any other right provided for by federal or state law of regulation.”
The statute continues:
“The licensee shall be liable for up to five hundred dollars ($500), and for costs and attorney fees, and may be enjoined from permitting the violation to continue.”
Chin compared the ambiguity of §1430(b) with that of other subsections under 1430, which used “each and every” language in authorizing penalties for violations.
“This difference in terms between the subdivisions suggests the Legislature intended to take a different approach with respect to the $500 cap in section 1430(b),” Chin said.
Policy Argument
Jarmon had argued that limiting damages to $500 per lawsuit would render the law “toothless” in protecting elderly patient safety and welfare. However, Chin said that §1430(b) provides a “strong deterrent” to violations by long-term care providers in the form of injunctions and attorney fees and did not foreclose the availability of plaintiffs to pursue civil actions.
“We conclude section 1430(b) was not intended to be the exclusive or primary enforcement mechanism for residents of long-term care facilities seeking compensation for harm suffered in those facilities,” Chin declared.
Dissenting Opinion
In his 26-page dissenting opinion that was joined by Justice Goodwin L. Liu, Justice Mariano-Florentino Cuéllar said Chin’s majority opinion “deprives nursing home residents of an important tool to deter and vindicate violations of their rights,” which already are being threatened by the coronavirus pandemic.
“Nowhere has the pain of the COVID-19 virus been more acutely felt than in our state’s nursing homes,” he wrote, noting that the one of the facilities run by ManorCare in Walnut Creek was reported to have had an outbreak among 130 people, 12 of whom died.
Cuéllar said Chin’s majority opinion “will significantly hamper private efforts to fill what will no doubt be a void created by the reduced public enforcement resourced.”
Cuéllar disagreed with Chin’s reading of “each and every” language in select subsections of §1430 as dispositive, pointing out that §1430(b) creates a private right of action whereas §1430(a), with §1424, establishes a public enforcement scheme led by the attorney general.
‘Useless’ Statutory Construction
Cuéllar also was critical of Chin’s conclusion that injunctions and attorneys fees served as “strong deterrents” under §1430(b). He wrote:
“If all of that is true, what possible purpose does damages of up to $500 per lawsuit serve? If the $500 is a penalty, then a $500 per-lawsuit penalty is clearly insufficient to serve the statute’s goal of deterring regulatory violations. If the $500 is considered compensatory, a per-lawsuit approach does not compensate residents for the violations of many rights covered by section 1430(b). We should be extremely wary of statutory constructions that render a word or phrase useless. That is, in practical terms, exactly what the majority’s construction of the $500 limitation achieves here.”
Chin pointed to the jury’s struggle in deciding how many violations ManorCare committed in supporting the conclusion that §1430(b) should be applied as a per-lawsuit cap to mitigate further difficulties. Cuéllar said the record showed major flaws in how the jury was guided and that “bad facts” should not “drive the creation of bad law.”
“The majority’s approach avoids this problem for section 1430(b) suits—but only by creating another: eliminating a meaningful damages remedy and undermining the statute’s purpose to provide protection and recourse for nursing home patients whose rights are violated,” Cuéllar said.
The case is Jarman v. HCR ManorCare Inc., S241431, 2020 S.O.S. 3955.
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