Who's the boss?: Statutory damage caps, courts, and state constitutional law

Washington and Lee Law Review, Winter 2001 by Light, Matthew W

I. Introduction

James Madison wrote that in designing the structure of a well-ordered government, writers of constitutions should give "those who administer each department the necessary constitutional means and personal motives to resist encroachments of the others.... Ambition must be made to counteract ambition."1 The framers of the United States Constitution thought that interbranch strife would keep each branch in check.2 Thus, the Constitution divides authority among legislative, executive, and judicial branches.3 The Constitution grants responsibility to each department, but each branch enjoys some control over the actions of the others.4 The contest for power among the branches produces the stability the framers considered necessary for good government.5 Madison predicted that tyranny would result, however, if one branch were to become too powerful and to take unto itself the functions of another.6

State constitutions reflect similar organization; the constitutions of states existing at the time of the federal Constitutional Convention influenced the writers of the federal Constitution.7 Furthermore, state constitutions written after the adoption of the United States Constitution mirror the federal separation of powers scheme.8 Thus, states experience interbranch struggles for power much like those the framers envisioned that the federal government would experience.9

This Note discusses one interbranch struggle currently being waged throughout the country: the battle between courts and legislatures for control over the tort system.10 The conflict over modern tort reform originated in the liability insurance crises of the 1970s and 1980s.11 The number of multi-- million dollar jury verdicts doubled between 1972 and 1983.12 The two decades saw huge increases in the cost of medical malpractice insurance and general liability insurance.13 In response to insurance cost increases, nearly every state adopted tort reform measures of some sort.14 The statutes proposed several different methods of solving the liability crisis, such as the

abolition of the collateral source nile,15 the establishment of panels of lawyers and doctors to screen medical malpractice claims, and the creation of a statutory limit on damages.16

This Note discusses the controversy between courts and legislatures over damage caps. Various legislatures across the country responded to the perceived liability crisis by attempting to limit the liability of tortfeasors.17 Some statutes limit only noneconomic damages; others limit all damages in specific types of claims.18 Whatever form the statutes take, parties finding their tort

recovery suddenly limited have often challenged the statutes on state constitutional grounds, beseeching state supreme courts to curtail an allegedly unconstitutional exercise of legislative power.19 Often, courts have sustained the challenges and struck down the law.20 This Note examines constitutional challenges to damage caps in six states: three states in which the caps fell (Illinois, Ohio, and Oregon)21 and three states in which they survived (Kansas, Maryland, and Virginia).22

This Note focuses on three theories that parties have used to attack the damage cap statutes.23 Part II explores challenges based on the right to a jury trial, an issue that involves questions concerning the power of juries at com

mon law and the power of legislatures to change common law.24 Part III discusses challenges to caps based on equal protection, due process, and special legislation clauses of state constitutions.25 Equal protection, due process, and special legislation analyses all rest upon rational basis review.26 The Note explores whether the courts correctly apply the relevant tests when considering the constitutionality of damage caps under these provisions.27 Part IV considers challenges to damage caps based on abuse of legislative prerogatives. It examines Kansas's quid pro quo rule for abolition of common law actions28 and Ohio's jurisprudence on legislative alteration of trial court jurisdiction.29 Finally, Part V of this Note concludes that the decisions upholding damage caps against constitutional attack are better-reasoned than those rejecting the caps.30

II. Challenges to Damage Caps Based on Jury Trial Guarantees

One commentator has described trial by jury as the "hallmark of the American tort system."31 Lawyers challenging damage caps often have grounded their attacks in state constitutional guarantees of a right to a civil trial by jury.32 This Part explores whether statutory damage caps invade the right to a jury trial by analyzing the decisions that courts handed down in four representative states: Kansas, Oregon, Maryland, and Virginia.33

A. Cases Rejecting Challenges to Damage Caps Based on Jury Trial Guarantees

Several states have rejected challenges to damage caps based on the jury trial guarantees of their respective state constitutions.34 This Note examines three such jurisdictions: Kansas, Virginia, and Maryland. Although these states do not constitute an exhaustive list of decisions rejecting jury trial guarantee challenges to the caps, they are a representative sample.