JESSICA CHAN et al., Plaintiffs and Appellants, v. PETER CURRAN, Defendant and Respondent.
No. A138234
First Dist., Div. One.
June 9, 2015
237 Cal.App.4th 601
The Dolan Law Firm, Christopher B. Dolan, Mary C. Barnes; Smith & McGinty, Daniel U. Smith and Valerie T. McGinty for Plaintiffs and Appellants.
Fred J. Hiestand for The Civil Justice Association of California as Amicus Curiae on behalf of Defendant and Respondent.
Tucker Ellis, Rebecca A. Lefler and Lauren H. Bragin for California Medical Association, California Dental Association, California Hospital Association and American Medical Association as Amici Curiae on behalf of Defendant and Respondent.
OPINION
BANKE, J.—
I. INTRODUCTION
After plaintiff and appellant Jessica Chan‘s mother died from internal hemorrhaging related to Coumadin use following heart surgery, Chan successfully sued defendant and respondent Peter Curran for medical malpractice. Neither the sufficiency of the evidence to support the malpractice verdict, nor any other issue associated with the trial and the rendition of the jury verdict, is before us. Rather, the sole issue on appeal is the trial court‘s postverdict reduction of the $1 million noneconomic damages award to $250,000, as required by the Medical Injury Compensation Reform Act of 1975 (MICRA; Stats. 1975, 2d Ex. Sess. 1975–1976, ch. 1, § 26.6, pp. 3975–3976;
Since MICRA‘s enactment in 1975, the cap on noneconomic damages has been before the California Supreme Court many times. In 1985, the high court upheld the cap against equal protection and due process challenges. (Fein v. Permanente Medical Group (1985) 38 Cal.3d 137 [211 Cal.Rptr. 368, 695 P.2d 665] (Fein).) In 1994, the court ruled the cap also applies to actions for partial indemnity, voicing no criticism of the statute and reiterating
Chan nevertheless maintains Fein, which rejected equal protection and due process challenges, is no longer controlling, claiming she has shown there no longer is a medical malpractice insurance “crisis” and therefore the rationale for the cap (indeed, for all of MICRA) no longer exists. Thus, according to Chan, the time is ripe to reexamine the constitutionality of
As we explain, the courts are extremely chary of invalidating legislative acts that have previously been held constitutional. Our Supreme Court has done so only on rare occasion, and we conclude Chan has not shown there is no reasonably plausible purpose presently advanced by
II. DISCUSSION
A. MICRA
“In May 1975, the Governor—citing serious problems that had arisen throughout the state as a result of a rapid increase in medical malpractice insurance premiums—convened the Legislature in extraordinary session to consider measures aimed at remedying the situation. In response, the Legislature enacted the Medical Injury Compensation Reform Act of 1975 (MICRA) . . . a lengthy statute which attacked the problem on several fronts.” (American Bank & Trust Co. v. Community Hospital (1984) 36 Cal.3d 359, 363 [204 Cal.Rptr. 671, 683 P.2d 670], fn. & citation omitted (American Bank).) “In broad outline, the act (1) attempted to reduce the incidence and severity of medical malpractice injuries by strengthening governmental oversight of the education, licensing and discipline of physicians and health care providers,3 (2) sought to curtail unwarranted insurance premium increases by authorizing alternative insurance coverage programs and by establishing new procedures to review substantial rate increases,4 and (3) attempted to reduce the cost and increase the efficiency of medical malpractice litigation by revising a number of legal rules applicable to such litigation.” (36 Cal.3d at pp. 363–364.)
In the Legislature‘s view, “[t]he continuing availability of adequate medical care depends directly on the availability of adequate insurance coverage, which in turn operates as a function of costs associated with medical malpractice litigation.” (Western Steamship, supra, 8 Cal.4th at p. 111.) “Accordingly, MICRA includes a variety of provisions all of which are calculated to reduce the cost of insurance by limiting the amount and timing of recovery in cases of professional negligence. (See
The cap on noneconomic damages set forth in
During the 1980‘s, the Supreme Court upheld many of MICRA‘s provisions against constitutional challenges, including
As to
B. Showing with Respect to “Changed Circumstances”
1. Chan‘s Showing
Chan acknowledges the cases discussed above, but contends the medical malpractice climate is profoundly different today than it was in 1975 when MICRA was enacted and in the 1980‘s when the Supreme Court passed on the constitutionality of its provisions.
In the trial court, Chan offered evidence that, since 1975, inflation has caused a roughly fourfold devaluation of the dollar. Thus, adjusted for inflation, the $250,000 noneconomic damages cap enacted in 1975 was worth $1.06 million in 2012 dollars. Or, flipped around, $250,000 in 2012 dollars equaled only $59,000 in 1975 dollars. Chan also offered the declaration of Phillip Allman, an economist, who observed there has been an approximately sixfold increase in the cost of legal services since 1976 and opined the $250,000 noneconomic damages cap discourages contingent-fee lawyers from taking many malpractice cases. Government statistics proffered by Chan also showed a precipitous increase in the cost of medical services and medical experts’ hourly fees.
Chan additionally offered declarations from current California attorneys who take personal injury cases on a contingency basis. However, because of MICRA, they either refuse to consider medical malpractice cases altogether, or take only those cases that appear strong and involve large economic damages, so the total amount of recoverable damages is likely to exceed $1 million. These attorneys declared they turn away from 50 to over 90 percent of facially meritorious malpractice claims. Thus, according to these attorneys, cases involving severe injury or death to the elderly and unemployed often do not reach the courts because economic damages are likely to be small, since lost wages are usually nonexistent and, if the victim is deceased, there are no future medical costs.
These attorneys also discussed their view that there are serious imbalances in the resources the plaintiffs and defendants are able to bring to bear in contingency fee cases, claiming insurance-industry lawyers can far outspend and outstaff cases because their clients pay by the hour and MICRA does not limit the amount of collectable fees. As did Chan‘s economist, these attorneys pointed out the high cost of investigating and proving medical malpractice
Chan also pointed to empirical studies of lawyers across the country, recounted in legal periodicals, confirming the anecdotal evidence provided by the attorney declarations—that damages caps appear to reduce contingency fee lawyers’ interest in taking medical malpractice cases with limited noneconomic damages and encourage them to focus on cases with high economic damages. Across all states, most attorneys rejected more than 90 percent of the medical malpractice cases brought to them. About 39 percent of time this was because the damages expected from a victory were viewed as insufficient to make the case worth the attorney‘s time. On the whole, if a lawyer perceived a 95 percent chance of success, the lawyer would want a case worth $250,000; a 51 percent chance of success, a case worth $500,000; and a 25 percent chance of success, a case worth $1 million.
As for this case, specifically, Chan‘s attorney submitted declarations outlining how the costs incurred (approximately $103,000) and legal fees (approximately $450,000, if based on hourly rates between $250 and $650 an hour) far exceeded the total jury award after the adjustment under MICRA ($321,562 net award), let alone the maximum allowable contingency fee thereon.6
Finally, Chan asserted Proposition 103, passed by the voters in 1988, has so completely solved the problem of high medical malpractice insurance rates there is no further need for MICRA‘s noneconomic damages cap. Proposition 103 prohibits the Insurance Commissioner from approving rates that are excessive, inadequate, or unfairly discriminatory, and from allowing such rates to remain in effect. (
Curran did not submit evidence rebutting Chan‘s claims of inflation and rising litigation costs. Instead, he submitted a declaration from James Hurley, an actuary, who discussed the past and continuing efficacy of MICRA in holding the line on medical malpractice insurance costs. He opined the noneconomic damages cap has succeeded in having, from 1975 on, an ongoing downward influence on the cost of medical malpractice insurance and that without the cap, “it would be reasonable to expect increases” in rates. According to Hurley, eliminating the cap could destabilize the insurance market because of “likely increases in claim costs and potential reduced willing underwriting capacity.” In support of this opinion, Hurley cited figures showing various annual rate changes in the 2000‘s were lower in California than in other states. He also noted figures associated with other states’ MICRA-like laws and with Texas‘s changeover to a cap. Hurley further opined California insurers are not, despite MICRA, profiting more than their nationwide counterparts (once a unique situation in New York is removed from the calculus), nor are they keeping reserves or surpluses out of line with those counterparts.
Curran also submitted a declaration from his attorney asserting Curran, contrary to Chan‘s accusations concerning an imbalance in resources, used fewer and less expensive resources than Chan in litigating the case. A declaration from Curran‘s insurer confirmed the $200 partner rate paid to Curran‘s attorney was typical of such cases.
C. Equal Protection
“Where, as here, a disputed statutory disparity implicates no suspect class or fundamental right, ‘equal protection of the law is denied only where there is no “rational relationship between the disparity of treatment and some legitimate governmental purpose.” ’ ” (Johnson v. Department of Justice (2015) 60 Cal.4th 871, 881 [183 Cal.Rptr.3d 96, 341 P.3d 1075] (Johnson), quoting People v. Turnage (2012) 55 Cal.4th 62, 74 [144 Cal.Rptr.3d 489, 281 P.3d 464] (Turnage).)
Chan does not dispute that the rational relationship test applies to her equal protection challenge to MICRA‘s noneconomic damages cap. (See Fein, supra, 38 Cal.3d at pp. 158, 162 [rational relationship test applicable to equal protection challenge to
This has “ ‘never been interpreted to mean,’ ” however, that the courts “ ‘may properly strike down a statute simply because [they] disagree with the
The “ ‘basic and conventional standard for reviewing economic and social welfare legislation’ ” that draws nonsuspect classifications and does not impinge on fundamental rights “ ‘invests legislation involving such differentiated treatment with a presumption of constitutionality and “requir[es] merely that distinctions drawn . . . bear some rational relationship to a conceivable legitimate state purpose.” [Citation.]’ ” (Warden, supra, 21 Cal.4th at p. 641, quoting D‘Amico v. Board of Medical Examiners (1974) 11 Cal.3d 1, 16–17 [112 Cal.Rptr. 786, 520 P.2d 10], disapproved on other grounds in Woodland Hills Residents Assn., Inc. v. City Council (1979) 23 Cal.3d 917, 944 [154 Cal.Rptr. 503, 593 P.2d 200].) Thus, under the rational relationship test, “ ‘[w]here there are “plausible reasons” for [the classification] “our inquiry is at an end.” ’ ” (Warden, supra, 21 Cal.4th at p. 644; accord, Johnson, supra, 60 Cal.4th at p. 881.)
“ ‘This standard of rationality does not depend upon whether lawmakers ever actually articulated the purpose they sought to achieve. Nor must the underlying rationale be empirically substantiated. [Heller [v. Doe (1993) 509 U.S. 312, 320] [125 L.Ed.2d 257, 113 S.Ct. 2637].] While the realities of the subject matter cannot be completely ignored (id. at p. 321), a court may engage in “rational speculation” as to the justifications for the legislative choice (id. at p. 320). It is immaterial for rational basis review “whether or not” any such speculation has “a foundation in the record.” ’ (Turnage, supra, 55 Cal.4th at pp. 74–75.)” (Johnson, supra, 60 Cal.4th at p. 881; accord, Warden, supra, 21 Cal.4th at p. 650 [“ ‘a legislative choice is not subject to courtroom factfinding and may be based on rational speculation unsupported by evidence or empirical data’ ”].) “[W]hen there is a reasonably conceivable justification for a classification, ‘[i]t is . . . “constitutionally irrelevant whether [the] reasoning in fact underlay the legislative decision” ’ [citation], or whether the ‘conceived reason for the challenged distinction actually motivated the legislature.’ ” (Warden, supra, 21 Cal.4th at p. 650.)
“While parties challenging legislation under the equal protection clause may introduce evidence supporting their claim that the legislation is
As we have discussed, during the 1980‘s, the Supreme Court upheld numerous provisions of MICRA against equal protection challenges, including the noneconomic damages cap. (Fein, supra, 38 Cal.3d 137 [upholding
The court readily concluded the damages cap was rationally related to the Legislature‘s declared purpose of “responding to an insurance ‘crisis.’ ” (Fein, supra, 38 Cal.3d at p. 162.) “It appears obvious that this section—by placing a ceiling of $250,000 on the recovery of noneconomic damages—is rationally related to the objective of reducing the costs of malpractice defendants and their insurers.” (Id. at p. 159.)
Given that the Supreme Court has already rejected an equal protection challenge to MICRA‘s noneconomic damages cap, Chan relies on a “changed circumstances” argument claiming (a) there no longer is a medical malpractice insurance crisis, (b) Proposition 103, under which the California Insurance Commissioner now sets medical malpractice insurance rates, has stabilized the insurance market, and (c) the ravages of inflation have decimated the economic significance of $250,000 in recoverable noneconomic damages. Chan thus asserts MICRA‘s noneconomic damages cap is no longer rationally defensible.
The role of “changed circumstances” in constitutional analysis is fraught with institutional tension and analytical difficulties. “It is not . . . easy for courts to step in and say that what was rational in the past has been made irrational by the passage of time, change of circumstances, or the availability of new knowledge. Nor should it be. Too many issues of line drawing make such judicial decisions hazardous. Precisely at what point does a court say
The maxims that govern rational basis review further contribute to the difficulties of a “changed circumstances” analysis, including that classifications may be based on “ ‘rational speculation unsupported by evidence or empirical data’ ” and are permissible if rationally related to any “realistically conceivable legislative purpose” and regardless of whether the “ ‘conceived reason . . . actually motivated the legislature.’ ” (Warden, supra, 21 Cal.4th at pp. 649–650, italics omitted.) Moreover, courts may engage in “ ‘rational speculation’ ” as to the justification for a legislative choice, and it is immaterial “ ‘ “whether or not” any such speculation has “a foundation in the record.” ’ ” (Johnson, supra, 60 Cal.4th at p. 881; cf. Santa Monica Beach, Ltd. v. Superior Court (1999) 19 Cal.4th 952, 973 & fn. 4 [81 Cal.Rptr.2d 93, 968 P.2d 993] (Santa Monica Beach) [noting in discussing “changed circumstances” that court has more closely examined legislative factfinding where fundamental rights are at stake].)
Thus, “[g]enerally, modification or repeal of a statute made obsolete by virtue of changed conditions is a legislative, not a judicial, prerogative.” (Stinnett, supra, 198 Cal.App.4th at p. 1428.)
Nevertheless, the courts have, on rare occasion, concluded “changed circumstances can transform a once-rational statute into an irrational law” and invalidated “archaic statutes” on equal protection grounds. (Burlington N. R. Co. v. Department of Public Service Regulation (9th Cir. 1985) 763 F.2d 1106, 1111 & fn. 3 [further noting “[w]here courts have invalidated archaic statutes, there is often an independent constitutional basis for so doing (i.e., a belated recognition that the statutes were unconstitutional as written)”]; see Santa Monica Beach, supra, 19 Cal.4th at p. 973 [the “circumstances for such invalidation are quite narrow”].)
Chan relies on Brown v. Merlo (1973) 8 Cal.3d 855 [106 Cal.Rptr. 388, 506 P.2d 212] (Brown), in which the Supreme Court employed a changed circumstances analysis to invalidate portions of California‘s venerable “guest statute,” which had been enacted in 1926 and barred nonpaying passengers from suing negligent “host” drivers. The statute also had a “series of limiting statutory ‘loopholes,’ ” that created an “absurd and illogical pattern which completely drain[ed] the statute of any rationality it might conceivably
The court identified the two justifications “traditionally . . . advanced” to support the guest statute‘s classification scheme as (1) the promotion of “hospitality by insulating generous drivers from lawsuits instituted by ungrateful guests” and (2) the elimination of “collusive lawsuits, in which a host fraudulently confesses negligence so as to permit his guest . . . to collect from the host‘s insurance.” (Brown, supra, 8 Cal.3d at p. 864.) It then concluded two pivotal developments wholly undermined the first justification—the expansion of the duty of due care in Rowland v. Christian (1968) 69 Cal.2d 108 [70 Cal.Rptr. 97, 443 P.2d 561],7 and the widespread prevalence of automobile liability insurance. (Brown, at pp. 865–867 & fn. 6 [in 1929, Cal. tort law imposed duty of due care only on business “invitees” and a lesser standard of care to “licensees,” including social guests], 868, fn. 9 [in “late 1920‘s automobile liability insurance was the exception rather than the rule . . .”]; see id., at pp. 869–872.) In short, it was now “irrational to assume that if a recipient of generosity is permitted recovery for negligent injuries, the cause of ‘ingratitude’ will be served or the cause of ‘hospitality’ will be plundered.” (Id. at p. 872.) The court similarly dispensed with the collusive justification—recent cases invalidating “the entire range of intrafamilial immunities, establish[ed] that it is unreasonable to eliminate causes of action of an entire class of persons simply because some undefined portion of the designated class may file fraudulent lawsuits.” (Id. at p. 875.) The constitutional vice with the guest statute as to this justification, said the court, was that it was “so grossly over inclusive [(prohibiting all guests from bringing any negligence claims against a driver)] as to defy notions of fairness or reasonableness.” (Id. at p. 877.)
In sum, Brown concluded that given sea changes in the common law of torts and the availability of automobile liability insurance, along with the statutory exceptions further undermining any conceivable rationality for the statute, there was no remaining rational underpinning for the challenged provisions of California‘s archaic guest statute. The court also observed, at the end of its opinion, that “[f]rom their very inception, automobile guest statutes have been the subject of severe criticism, both academic and judicial. In our view, the widespread antipathy to such statutes is in large part a reflection of the irrationality and unfairness of these legislative schemes,
In In re Paris Air Crash (9th Cir. 1980) 622 F.2d 1315, the Ninth Circuit, in rejecting an equal protection challenge to California‘s bar against punitive damages in wrongful death cases (in contrast to their availability in survival actions), distinguished Brown and Cooper as dealing with long repudiated guest statutes. The guest statutes, said the circuit court, were “more burdensome and anomalous than other limitations on recovery for four reasons.” (In re Paris Air Crash, supra, at p. 1321.) First, the guest statutes had “denied a large class of persons any compensation at all for grievous physical injury.” (Ibid.) Second, the guest statutes were not based on any “contemporary justification” but “rather on vestigial analogies to the law of bailments.” (Ibid.) Third, guest statutes “were generally thought to be irrational and vestigial.” (Ibid.) And, fourth, the guest statutes pertained to common law tort actions, in which the courts played a more active role. (Ibid.) Accordingly, the Ninth Circuit did not consider Brown and Cooper particularly apposite. (Ibid.)
Three of these reasons apply here. First, MICRA‘s noneconomic damages cap does not wholly deny compensation to medical malpractice plaintiffs—there is no limitation on the recovery of actual damages (i.e., medical costs and lost wages) and there is only a partial limitation on the recovery of noneconomic damages. Second, MICRA is not based on vestigial analogies to archaic law. And third, while there is significant debate about the wisdom and efficacy of damages caps in controlling medical malpractice insurance costs, it is a matter of legitimate debate. (See Fein, supra, 38 Cal.3d at pp. 159–161.) Accordingly, MICRA is not afflicted with the peculiar characteristics of the antiquated guest statutes that colored the equal protection analyses in Brown and Cooper.
We also think it is significant that when the Supreme Court decided Fein, the majority disregarded two objections by the dissent which lie at the heart of the equal protection challenge Chan now advances. (See Fein, supra, 38 Cal.3d at p. 163 [acknowledging and responding to dissent].) First, the dissent maintained the malpractice insurance crisis was “fading into the past” and therefore the stated rationale for MICRA no longer existed. (Fein, at p. 169 (dis. opn. of Bird, C. J.).) Second, the dissent was concerned inflation would inevitably reduce the value of the fixed $250,000 cap. (Id. at p. 171 (dis. opn. of Bird, C. J.) [“Even this small figure will gradually decline as
Nor does the evidentiary showing Chan made demonstrate that the relevant factual premise for MICRA‘s noneconomic damages cap (and all the other provisions of MICRA) is “totally altered.”
Chan insists Proposition 103 insures there will never again be a malpractice insurance “crisis.” But this measure does not prohibit rate increases or require low rates. Rather, it provides that insurance rates “shall be maintained at fair levels by requiring insurers to justify all future increases.” (Ballot Pamp., Gen. Elec. (Nov. 8, 1988) text of Prop. 103, p. 99, italics omitted.) Thus, Proposition 103 focuses on “ ‘a fair return’ ” given economic realities, i.e., an insurance company‘s projected income and losses. (Fogel v. Farmers Group, Inc. (2008) 160 Cal.App.4th 1403, 1408 [74 Cal.Rptr.3d 61] (Fogel); see
Chan also has not shown that the underlying circumstances that gave rise to the medical malpractice insurance problem that reached crisis proportions in the 1970‘s no longer exist. (See American Bank, supra, 36 Cal.3d at pp. 371–372 [identifying some of the “[m]any factors” contributing to the “problems” that had arisen “in the medical malpractice field”].) The situation, as we see it, is akin to attacking a rent control ordinance on the ground rents have stabilized—there would no longer be, under Chan‘s theory, a “crisis” in the rental housing market and thus no justification for rent control. However, the crisis only truly abates if the factors that caused it—i.e., a greater demand for housing than there is supply to meet it—no longer exist. (See Santa Monica Beach, supra, 19 Cal.4th at pp. 972–973 [denying a takings challenge to rent control, stating “[t]he modern view is ‘that a legitimate and rational goal of price or rate regulation is the protection of consumer welfare’ . . . irrespective of the existence of an emergency” and asking rhetorically “[h]ow long would a court, or a litigant, have to wait to give the law a ‘fair chance’ to work before declaring that it is a failure and therefore unconstitutional?” (citation omitted & italics added)]; San Remo Hotel v. City and County of San Francisco (2002) 27 Cal.4th 643, 674 [117 Cal.Rptr.2d 269, 41 P.3d 87] [“ ‘[m]aintaining the availability of’ housing supply is a ‘reasonable means’ of addressing San Franciscans’ housing needs (italics added)”].)
In fact, in American Bank, the Supreme Court rejected an argument that MICRA‘s periodic payment provision was unconstitutional because, after passage of the legislation, overall medical costs continued to rise. The court pointed out that the act was focused on reducing the cost of malpractice insurance and alleviating the myriad problems that caused, not on medical costs overall. It further observed, “indeed, in this respect [insurance costs,] statistics suggest that MICRA was in fact successful.” (American Bank, supra, 36 Cal.3d at p. 373.) The court did not begin to suggest that the act‘s apparent success rendered it, at the same time, unconstitutional. Furthermore, the Legislature declared in the preamble to MICRA that the “statutory remedy herein provided is intended to provide an adequate and reasonable remedy within the limits of what the foregoing public health and safety considerations permit now and into the foreseeable future.” (Stats. 1975, 2d Ex. Sess. 1975–1976, ch. 2, § 12.5, p. 4007, italics added.)
Other than her reliance on Proposition 103, which we have concluded is not the palliative she claims, Chan has not demonstrated that the fundamentals of our health care system and its interface with our tort and insurance
Our view is not altered by the United States Supreme Court‘s recent opinion in Shelby County v. Holder (2013) 570 U.S. 529 [186 L.Ed.2d 651, 133 S.Ct. 2612] (Shelby County), to which Chan also cites. In that case, the Supreme Court, in light of changed circumstances, invalidated the 2006 reauthorization of the Voting Rights Act of 19659 coverage formula, which incorporated the formula originally enacted in 1965. (Shelby County, at p. 556 [133 S.Ct. at pp. 2625–2631].) The court viewed the act as a “sharp[] depart[ure]” from the constitutional norms dictated by the equal sovereignty of the states and federal government, which had been justified for a number of years only by “ ‘exceptional conditions.’ ” (Id. at p. 544 [133 S.Ct. at p. 2624].) “Nearly 50 years later,” however, “things [had] changed dramatically.” (Id. at p. 547 [133 S.Ct. at p. 2625].) While there was “no doubt” voter participation had improved “because” of the act (id. at p. 548 [133 S.Ct. at p. 2626], italics omitted), this did not make the specifics of the challenged formula “immune” from scrutiny (id. at p. 550). The problem, according to the court, was that the formula was “based on decades-old data and eradicated practices”—specifically, low voter turnout in the 1960‘s and early 1970‘s and literacy tests that had long been abolished. (Id. at p. 535 [133 S.Ct. at p. 2617], italics added.) The court refused to sanction an “ ‘extraordinary departure from the traditional course of relations between the States and the Federal Government’ ” (id. at p. 544 [133 S.Ct. at p. 2624], quoting Presley v. Etowah County Comm‘n (1992) 502 U.S. 491, 500–501 [117 L.Ed.2d 51, 112 S.Ct. 820]) on the basis of historic facts that indisputably no longer existed and had “no logical relation to the present day.” (Shelby County, supra, at p. 556 [133 S.Ct. at p. 2629].)
While there is no doubt MICRA is a significant legislative enactment, it is not a federal law, and does not impact the fundamental constitutional compact
Furthermore, unlike the formula specifics at issue in Shelby County that were demonstrably and irrefutably nonexistent when Congress reauthorized the formula in 2006, there is no evidence in the record here that the factors that precipitated the medical malpractice insurance crisis addressed by MICRA no longer exist and the act in no plausible way continues to advance the Legislature‘s purpose in enacting it.
Chan observes courts in some other states have ruled damages caps bear no rational relationship to controlling insurance costs. (See Stinnett, supra, 198 Cal.App.4th at p. 1432, fn. 4 [summarizing cases]; Estate of McCall v. U.S. (Fla. 2014) 134 So.3d 894, 910 (McCall) [“Reports have failed to establish a direct correlation between damages caps and reduced malpractice premiums.”]; Arbino v. Johnson & Johnson (2007) 116 Ohio St.3d 468 [2007-Ohio-6948, 880 N.E.2d 420, 435] [damages caps violated rational basis test “because they imposed the cost of the intended benefit to the public solely upon those most severely injured”].)
However, courts in many other states have upheld damages caps. (See, e.g., Judd ex rel. Montgomery v. Drezga (2004) 2004 UT 91 [103 P.3d 135, 141] [“The legislature‘s determination that it needed to respond to the perceived medical malpractice crisis was logically followed by action designed to
Moreover, in Fein, the Supreme Court acknowledged some other courts had invalidated damages limitations in medical malpractice cases. (Fein, supra, 38 Cal.3d at p. 161.) With one exception, observed the court, these all involved limitations on both actual and noneconomic damages. (Ibid.) In any event, the court continued, no principle of California or federal constitutional law prohibits the Legislature from “limiting the recovery of damages in a particular setting in order to further a legitimate state interest.” (Ibid.) We therefore conclude Fein remains the controlling authority as to the constitutional validity of MICRA‘s noneconomic damages cap on equal protection grounds and reject Chan‘s equal protection challenge to
D. Due Process
The due process claim that has historically been advanced against MICRA‘s damages provisions is that the act curtails or imposes new constraints on what was historically recoverable in medical malpractice actions without providing plaintiffs “an adequate quid pro quo.” (E.g., Fein, supra, 38 Cal.3d at pp. 157–160 [challenge to noneconomic damages cap]; see American Bank, supra, 36 Cal.3d at pp. 368–369 [challenge to provisions allowing periodic payment of “future damages” and limiting some of those damages on the plaintiff‘s death].)
The Supreme Court rejected this argument, explaining “ ‘[it] is well established that a plaintiff has no vested property right in a particular measure of damages, and that the Legislature possesses broad authority to modify the scope and nature of such damages. [Citations.] Since the demise of the substantive due process analysis of Lochner v. New York (1905) 198 U.S. 45 [49 L.Ed. 937, 25 S.Ct. 539],10 it has been clear that the constitutionality of measures affecting such economic rights under the due process clause does not depend on a judicial assessment of the justifications for the legislation or of the wisdom or fairness of the enactment [i.e., the “adequacy” of the quid pro quo]. So long as the measure is rationally related to a legitimate state interest, policy determinations as to the need for, and the desirability of, the
The court also pointed out past cases had made “clear that the Legislature retains broad control over the measure, as well as the timing, of damages that a defendant is obligated to pay and a plaintiff is entitled to receive, and that the Legislature may expand or limit recoverable damages so long as its action is rationally related to a legitimate state interest. In Werner, supra, 35 Cal.2d 121, for example, our court applied the ‘rational relationship’ standard in dismissing a due process attack on a statute—Civil Code section 48a—which permitted a plaintiff who brought a libel or slander action against a newspaper generally to obtain only ‘special damages,’ largely eliminating the traditional right to obtain ‘general damages’ that such a plaintiff had enjoyed before the statute.” (Fein, supra, 38 Cal.3d at p. 158, italics omitted.)
It was “obvious” to the court that
It was also “worth noting,” said the court, “that in seeking a means of lowering malpractice costs, the Legislature placed no limits whatsoever on a plaintiff‘s right to recover for all of the economic, pecuniary damages—such as medical expenses or lost earnings—resulting from the injury, but instead confined the statutory limitations to the recovery of noneconomic damages, and—even then—permitted up to a $250,000 award for such damages. Thoughtful jurists and legal scholars have for some time raised serious questions as to the wisdom of awarding damages for pain and suffering in any negligence case, noting, inter alia, the inherent difficulties in placing a monetary value on such losses, the fact that money damages are at best only imperfect compensation for such intangible injuries and that such damages are generally passed on to, and borne by, innocent consumers.11 (This is fn.
In this case, Chan is advancing a different due process argument—one grounded on the “right of access to the courts for all persons.” (Payne v. Superior Court (1976) 17 Cal.3d 908, 914 & fn. 3 [132 Cal.Rptr. 405, 553 P.2d 565] (Payne).) Chan‘s theory in this regard is as follows: Medical malpractice claims cannot realistically be pursued without legal representation. Attorneys almost always take medical malpractice cases on a contingency fee basis. In many cases, as in the instant one, the largest component of the verdict is noneconomic damages. Thus, the noneconomic damages verdict is the most significant monetary pool for attorney fees. In today‘s dollars, however, $250,000 does not yield enough in contingency fees to make prosecuting most medical malpractice claims economically feasible, effectively denying most malpractice victims access to the courts.
This is essentially the same due process argument that was advanced in Roa, supra, 37 Cal.3d at pages 925–929, one of the panoply of cases, along with Fein and American Bank, initially challenging MICRA. Roa, however, involved a challenge to MICRA‘s attorney fees provision limiting contingency percentages (
Our initial concern with Chan‘s due process argument, seemingly borrowed from Roa which involved MICRA‘s contingency fee statute, is that it is misdirected in the context of a challenge to one of MICRA‘s damages statutes. What Chan insists is constitutionally required is that noneconomic damages be potentially sufficient to cover attorney fees. This is difficult to reconcile with the fact California ascribes to the “American Rule” under
elements of damages in negligence cases [citations]; any change in this regard must await reexamination of the problem by the Legislature.”
Chan‘s position is also difficult to reconcile with the fact there is a sharp demarcation in the law between damages and costs incurred in bringing suit, including attorney fees. (See
Accordingly, in spelling out a measure of damages, or in limiting or excluding certain types of damages, we are hard pressed to see why the Legislature must, as a matter of constitutional due process, take into account the recovery of attorney fees. Indeed, the ramifications of such a mandate would be startling, given the number of contexts in which recoverable damages have been limited. (See, e.g., Fein, supra, 38 Cal.3d at pp. 157–158 [discussing cases involving limits on recoverable damages and explaining there is no vested right in particular measure of damages]; Werner, supra, 35 Cal.2d at pp. 125–137; Cadlo, supra, 151 Cal.App.4th at p. 1318; Jenkins v. County of Los Angeles, supra, 74 Cal.App.4th at pp. 535–538; Quackenbush, supra, 60 Cal.App.4th at pp. 464, 466–467; In re Paris Air Crash, supra, 622 F.2d at pp. 1322–1324.) The Legislature, moreover, could only guess at what reasonable attorney fees might be in prosecuting a case in any given context, not to mention would need to be prescient about inflationary pressures.
We suspect that is why no case cited by the parties has ever suggested the constitutionality of a damages statute depends, in part, on whether it allows
We also cannot reconcile Chan‘s argument with the general rule that there “is no due process right to counsel in civil cases.” (Walker v. State Bar (1989) 49 Cal.3d 1107, 1116 [264 Cal.Rptr. 825, 783 P.2d 184] (Walker); People v. Madeyski (2001) 94 Cal.App.4th 659, 662 [115 Cal.Rptr.2d 14]; see Jara v. Municipal Court (1978) 21 Cal.3d 181, 184 [145 Cal.Rptr. 847, 578 P.2d 94] [indigent civil litigants do not have right to language interpreters at public expense and noting “cases have refused to require counties to provide indigent civil litigants with counsel or with appellate transcripts”]; Iraheta v. Superior Court (1999) 70 Cal.App.4th 1500, 1508 [83 Cal.Rptr.2d 471] [“the right to counsel has been recognized to exist only where the litigant may lose his physical liberty if he loses the litigation”]; County of Fresno v. Superior Court (1978) 82 Cal.App.3d 191, 195 [146 Cal.Rptr. 880] [“our independent review of the authorities in this and other states has failed to turn up a single case wherein a court has held that an indigent civil litigant is entitled to court-appointed counsel at public expense”]).12
Chan‘s reliance on Boddie v. Connecticut (1971) 401 U.S. 371 [28 L.Ed.2d 113, 91 S.Ct. 780] (Boddie) is misplaced. In Boddie, the United States Supreme Court held indigents could not be forced to pay a state court filing fee in order to dissolve their marriage. Given the state‘s monopoly on granting divorce through a judicial proceeding, such a proceeding became “the only effective means of resolving the dispute at hand and denial of a defendant‘s full access to that process raises grave problems for its legitimacy.” (Id. at p. 376.) The court went on to emphasize, however, that its
In contrast, in United States v. Kras (1973) 409 U.S. 434 [34 L.Ed.2d 626, 93 S.Ct. 631] (Kras), the Supreme Court upheld a requirement that those seeking bankruptcy protection, including an indigent debtor, must pay a filing fee (which bears a rational basis to having the bankruptcy court system sustained by those who use it). (Id. at pp. 444–448.) “Kras’ alleged interest in the elimination of his debt burden, and in obtaining his desired new start in life, although important and so recognized by the enactment of the Bankruptcy Act, does not rise to the same constitutional level” as the marriage interests in Boddie. (Kras, at p. 445.) “If Kras is not discharged in bankruptcy, his position will not be materially altered in any constitutional sense. Gaining or not gaining a discharge will effect no change with respect to basic necessities.” (Ibid.) Not only did the Supreme Court view Kras‘s economic interest in a bankruptcy discharge as not fundamental, it also concluded the government lacked a monopoly “over the establishment, enforcement, or dissolution of debts.” (Ibid.) “In contrast with divorce, bankruptcy is not the only method available to a debtor for the adjustment of his legal relationship with his creditors. The utter exclusiveness of court access and court remedy . . . was a potent factor in Boddie. But ‘[w]ithout a prior judicial imprimatur, individuals may freely enter into and rescind commercial contracts . . . .’ ” (Ibid.) “However unrealistic the remedy may be in a particular situation, a debtor, in theory, and often in actuality, may adjust his debts by negotiated agreement with his creditors. . . . Government‘s role with respect to the private commercial relationship is qualitatively and quantitatively different from its role in the establishment, enforcement, and dissolution of marriage.” (Id. at pp. 445–446.)
The California Supreme Court examined Boddie and Kras in Payne, supra, 17 Cal.3d 908, in which a prisoner sought to defend a civil suit for damages. He was unable to obtain counsel and, due to his incarceration, could not personally attend court proceedings. As a result, he suffered a default judgment. (Id. at pp. 911–912.) The court vacated the default, concluding that if the defendant were found indigent, he had a right to meaningful court access, either by appointment of counsel or by a continuance until he was free to defend the action himself. (Id. at pp. 912, 923–924.) The court reasoned that to defend his property rights, the prisoner had no alternative to the judicial forum into which he had been thrust, and his status as a prisoner foreclosed him from access, via personal appearance or by counsel. (Id. at pp. 917–918.) The court emphasized it was not ruling “that all indigents have a right to counsel in civil cases” or establishing “that indigent prisoners who
Thus, while MICRA‘s noneconomic damages cap may well influence an attorney‘s decision to take or reject a medical malpractice case on contingency, the cap does not violate a due process right to court access. While causes of action for negligently caused injury or death serve important public interests, no fundamental constitutional interest akin to that in Boddie underlies these tort actions for money damages. (See Kras, supra, 409 U.S. at p. 445; Brown, supra, 8 Cal.3d at p. 862, fn. 2 [declining to apply strict scrutiny to “guest” statute precluding passengers from suing negligent drivers because “right to sue for negligently inflicted injuries is [not] a ‘fundamental interest’ ”].) And unlike in Boddie, MICRA‘s damages cap does not invariably close the courthouse doors to malpractice plaintiffs. Even assuming it diminishes the number of cases taken by lawyers on contingency, it does not prevent individuals from pursuing their own cases, hiring an attorney on an hourly basis, or seeking pro bono legal assistance. (See Kras, supra, 409 U.S. at pp. 445–446; Walker, supra, 49 Cal.3d at p. 1116; Payne, supra, 17 Cal.3d at pp. 923–924; Cornett v. Donovan (1995) 51 F.3d 894, 899.) A malpractice victim may also negotiate a resolution of his or her claim, even if that may prove difficult. (See Kras, supra, 409 U.S. at pp. 445–446.)
Chan also notes that in 2009, the Legislature enacted legal aid legislation recognizing the “critical need for legal representation in civil cases.” (Stats. 2009, ch. 457, § 1, subd. (b), p. 4491.) This legislation does not, however, mandate counsel in every civil case, let alone every medical malpractice case. Instead, it encourages pro bono representation and requires, subject to funding, pilot programs in certain courts to appoint counsel to represent “low-income parties in civil matters involving critical issues affecting basic human needs.” (Legis. Counsel‘s Dig., Assem. Bill No. 590 (2009–2010 Reg. Sess.); Stats. 2009, ch. 457.) Moreover, medical malpractice is not among the enumerated “needs.” (See
In sum, we conclude Chan‘s due process argument—predicated on the assertion recoverable noneconomic damages are insufficient to cover reasonable attorney fees—cannot be reconciled with established constitutional principles.
Chan lastly contends the reduction of a damages award pursuant to MICRA‘s noneconomic damages cap interferes with her right to trial by jury. (See
In California, the right to a jury trial applies in any action in which the parties would have had the right to a jury trial under the common law as it existed in 1850, when the California Constitution was adopted. (People v. One 1941 Chevrolet Coupe (1951) 37 Cal.2d 283, 286–287 [231 P.2d 832]; Hung v. Wang (1992) 8 Cal.App.4th 908, 927 [11 Cal.Rptr.2d 113] (Hung), partially superseded by statute as stated in Pavicich v. Santucci (2000) 85 Cal.App.4th 382, 396 [102 Cal.Rptr.2d 125].) However, the scope of the right is not immutable, even as to rights that existed at common law. (See American Bank, supra, 36 Cal.3d at p. 375 [the state constitutional right to jury trial “ ‘ “does not require adherence to the letter of common law practice” ’ ”]; Hung, at p. 927 [“It is not a static right.”].)
Thus, in American Bank, the Supreme Court rejected a variation of the right to jury trial argument Chan makes here. In that case, the plaintiff challenged MICRA‘s provision for periodic payments (
The court reaffirmed its holding in American Bank in Salgado. (Salgado, supra, 19 Cal.4th at p. 649.) In Salgado, the jury, following the procedures suggested in American Bank, returned special verdicts as to the character of the future damages (which included $550,000 in noneconomic damages) and also determined the present value of future medical expenses. (Salgado, at p. 637.) The court held the damages cap applies whether noneconomic
In discussing the noneconomic damages cap, the court explained it “places no limit on the amount of injury sustained by the plaintiff, as assessed by the trier fact, but only on the amount of the defendant‘s liability therefor.” (Salgado, supra, 19 Cal.4th at p. 640.) Thus, the cap is “not a legislative attempt to estimate the true damages suffered by plaintiffs”—that being the province of the jury—“but rather an attempt to control and reduce medical malpractice insurance costs by placing a predictable, uniform limit on the defendant‘s liability for noneconomic damages.” (Id. at p. 641.) The court went on to expressly reject arguments that having juries determine the present value of future noneconomic damages, with trial courts thereafter applying the MICRA cap and establishing periodic payment schedules, violates the right to jury trial. (Salgado, at pp. 647–649.)13
Indeed, Chan‘s contention that the damages cap violates the right to jury trial “is but an indirect attack upon the Legislature‘s power to place a cap on damages.” (Yates v. Pollock (1987) 194 Cal.App.3d 195, 200 [239 Cal.Rptr. 383] (Yates).) Yet, as we have discussed, our Supreme Court has repeatedly held “the Legislature retains broad control over the measure, as well as the timing, of damages that a defendant is obligated to pay and a plaintiff is entitled to receive, and that [it] may expand or limit recoverable damages so long as its action is rationally related to a legitimate state interest.” (Fein, supra, 38 Cal.3d at p. 158, italics omitted.) And as to noneconomic damages, specifically, the court has observed no California case “has ever suggested that the right to recover for such noneconomic injuries is constitutionally immune from legislative limitation or revision.” (Id. at pp. 159–160.)
We cannot square Chan‘s assertion that MICRA‘s limitation on noneconomic damages violates the right to jury trial with the Supreme Court‘s explicit holdings that the Legislature is empowered to set the measure and amount of recoverable damages.14 We therefore join the other Courts of
As she does in connection with her equal protection argument, Chan claims “changed circumstances” should lead to a different result here as to her denial of jury trial argument. But our conclusion—that MICRA‘s damages cap is a legal limitation on recoverable damages and does not impair the jury‘s factfinding role—does not hinge on whether the act has a continued rationale. Moreover, to the extent Chan‘s jury trial changed circumstances argument is a reprise of her equal protection changed circumstances argument, we have already addressed it.
III. DISPOSITION
The judgment is affirmed. Costs on appeal to respondent.
Humes, P. J., and Margulies, J., concurred.
Appellants’ petition for review by the Supreme Court was denied September 23, 2015, S227950. Werdegar, J., did not participate therein.
trial—and that is so even though additur reflects a factual finding by the trial court. (Id. at pp. 831–832 [additur “should not be treated differently from other modern devices aimed at making the relationship between judge and jury as to damages as well as to other matters, one that preserves the essentials of the right to jury trial without shackling modern procedure to outmoded precedents” (fns. omitted)]; see id., at pp. 828–830, 833.) MICRA‘s noneconomic damages cap, in contrast, is not even a species of factfinding, but a legislative limitation on damages marking the legal boundaries of liability. (See Salgado, supra, 19 Cal.4th at p. 641; American Bank, supra, 36 Cal.3d at pp. 363–364 [MICRA revised numerous “legal rules” applicable to medical malpractice actions].)