Opinion ID: 2263407
Heading Depth: 3
Heading Rank: 3

Heading: The Collateral Source Issue

Text: Sears' final claim of error is that the Superior Court misapplied the collateral source rule by excluding from the jury's consideration, evidence of the payments that Maria Midcap received (and would continue to receive) from her late husband's Social Security and Air Force pension benefits. This Court reviews questions of law, including the application of the collateral source rule, de novo. [30] We conclude that the trial court erred by excluding that evidence. In order to provide guidance to the trial court on remand, we explain why. The plaintiffs' expert, Dr. William R. Latham III, testified that Maria Midcap's damages included the loss of her husband's military pension and his Social Security benefits. The trial court ruled that the collateral source rule applied to those payments, and as a consequence, precluded Sears from showing that those payments, although claimed as actual losses, were not losses since Maria Midcap had in fact received and would continue to receive substantial portions of her husband's benefits from those two sources. Under the collateral source rule, a tortfeasor is not entitled to mitigate damages in the amount of payments or compensation that the injured party receives from a collateral source. [31] The policy underlying that rule is that a tortfeasor has no interest in monies that the injured party receives from an unrelated source, and therefore has no right to benefit from those payments. [32] Generally, courts exclude Social Security and Air Force Pension benefits under the collateral source rule. [33] This case, however, presents a different factual scenario than in cases, such as Davis and Nanticoke, that apply the collateral source rule, because in those cases the plaintiff did not make a claim for lost Social Security or Air Force pension benefits. Rather, those cases involved the traditional application of the collateral source rule. That is not this case. The facts in this case are more analogous to those in Rotolo Chevrolet v. Superior Court, a California case where the plaintiff made a claim for lost pension benefits due to his early retirement. [34] The defendant sought to introduce evidence that the plaintiff had continued to receive his pension benefits. [35] The plaintiff objected under the collateral source rule. [36] Relying primarily on equity and common sense, [37] the court held that [e]ven if [the plaintiff] may recover for the reduction in his pension benefits, he cannot use the collateral source rule to prevent [the defendant] from introducing evidence that he is, in fact, receiving a pension. [38] Similarly, the plaintiffs here cannot use the collateral source rule to prevent the defendant from introducing evidence that the plaintiff was in fact still receiving, at least in part, the decedent's Air Force pension payments or Social Security benefits. That is, the collateral source doctrine should not bar evidence being offered to show that a payment that is represented to the jury as a benefit that the plaintiffs lost as a result of the decedent's injury or death, was in fact not lost, either in whole or in part, and is actually being received. [39] Thus, if at re-trial, the plaintiffs are permitted to blackboard Mr. Midcap's Social Security and Air Force pension payments as lost benefits, the defendants must be permitted to show that those payments actually were or will be received.