Should We Have Seen This Coming? Supreme Court of Georgia: Duty to Preserve is Triggered by Constructive Notice of Anticipated Litigation


By: E. Andrew Treese

It has been clear for some time that a duty to preserve evidence is triggered by actual notice of pending or contemplated litigation.  Last week the Supreme Court of Georgia held that the duty is also triggered by constructive notice, that is, when “the defendant/alleged tortfeasor … reasonably should have anticipated litigation, even without notice of a claim.”

Read that again.  The law in Georgia is now that sanctions for spoliation may be entered against an alleged tortfeasor on the theory that it should have seen a suit coming, even if it never did, and even if it never received a preservation letter or letter of representation.

The case is Phillips v. Harmon, S14G1868 (Ga. June 29, 2015), a medical malpractice lawsuit arising from an alleged “bad birth.”  Shortly after the birth the hospital conducted a “sentinel event” investigation, an internal query triggered by some unexpected outcomes which result in serious injury or death.  The hospital’s investigation did not, however, preserve a paper strip from a fetal heart rate monitor.  Plaintiffs argued this constituted spoliation and asked for sanctions.  The trial court refused, reasoning that no spoliation occurred because at the time the strip was lost, the hospital was not on actual notice that the plaintiffs contemplated filing suit.  On appeal from a defense verdict, the Georgia Court of Appeals affirmed.

The Supreme Court of Georgia reversed, explaining that the duty to preserve may be triggered by actual or constructive notice that suit may be filed.  The Court further identified several circumstances which could give rise to constructive notice, including: (1) the type and extent of injury; (2) the extent to which fault for the injury is clear; (3) potential financial exposure if faced with a finding of liability; (4) the relationship and course of conduct between the parties, including past or threatened litigation; and (5) the frequency with which litigation occurs in similar circumstances.  The Court also reiterated previous admonitions that trial courts should impose sanctions “only in exceptional cases” and consider “whether the party who destroyed the evidence acted in good or bad faith.”  Trial courts in Georgia are vested with broad discretion to impose sanctions, however, and it will likely take months or years before the impact of the new rule is clear.

Strategically, the Phillips opinion underscores the importance of prompt and thorough investigation of potential claims, even in the absence of a preservation request.  Companies with relatively short retention policies (30, 60, or 90 days), particularly regarding audio and video-recordings, may want to re-examine their current policies and consider involving counsel early in pre-suit investigations.