Nicholson v. Thom

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.

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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.

-28-

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:

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(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.