Oregon Supreme Court upholds the constitutionality of the statutory cap on noneconomic damages
February, 2008
On February 22, The Oregon Supreme Court upheld the constitutionality of the statutory cap on noneconomic damages (ORS 31.710) as applied to claims for wrongful death. In Hughes v. PeaceHealth, ___ Or ___, ___ P3d ___ (SC S053447, Feb. 22, 2008), decedent's mother filed suit against PeaceHealth Medical Group for the wrongful death of her daughter while under Defendant's medical care. The jury returned a verdict awarding plaintiff, inter alia, $1 million in noneconomic damages. In entering the judgment, the trial court applied ORS 31.710, reducing noneconomic damages to $500,000. Plaintiff appealed, contending that application of the statutory cap on noneconomic damages violates two provisions of the Oregon Constitution – the Remedy Clause (Article I, section 10) and the Right-to-a-Jury-Trial Clause (Article I, section 17). The Court of Appeals rejected those challenges. 204 Or App 614, 131 P3d 70, relying 98 (2006). The Court relied mostly on the Supreme Court's decision in Greist v. Phillips, 322 Or 281, 906 P2d 789 (1995), in which the Court had rejected nearly identical constitutional challenges. Plaintiff sought review, arguing that the Supreme Court had erred in its prior Remedy Clause analysis, and noting that the Court had subsequently overruled some of its jury-trial analysis.
Remedy Clause
Article I, section 10 of the Oregon Constitution provides, in part, that "every man shall have remedy by due course of law for injury done him in his person, property or reputation." In Smothers v. Gresham Transfer, Inc., 332 Or 83, 124, 23 P3d 333 (2001), the Supreme Court established a methodology for analyzing claims under the Remedy Clause, noting that the Remedy Clause applies only to claims that address harms done to rights that were protected by the Oregon Constitution at the time it was adopted. Juarez v. Windsor Rock Products, Inc., 341 Or 160, 169-73, 144 P3d 211 (2006). Therefore, if a statute abolishes a cause of action that provided a remedy for injuries to interests that were protected by the Constitution, and the statute is challenged as violating the Remedy Clause, the Court first considers whether, in 1857 when the drafters wrote the Constitution, "did the common law of Oregon recognize a cause of action for the alleged injury?" See Smothers, 322 Or at 124. If the answer to that question is "yes," the Court then asks whether the Legislature has "provided a constitutionally adequate substitute remedy for the common-law cause of action for that injury." Id.
The Supreme Court noted in Hughes that it had repeatedly held that Oregon has never recognized a common-law cause of action for wrongful death, and that such a claim is purely statutory. The Court also noted that it recently held in Juarez that the kinds of injuries for which the plaintiffs sought damages (i.e. mental suffering, loss of society and companionship, etc.), were not for injury done to plaintiffs' "property" within the meaning of the Remedy Clause.
Plaintiff argued that the Court had erred in identifying the scope of the of the rights protected by Article I, section 10, and also in stating that the common law did not recognize a cause of action for wrongful death. The Supreme Court rejected both arguments. The Court reviewed the historical context for Oregon's adoption of its Constitution. First, the Court addressed Plaintiff's argument that the common-law included some statutes that existed when the Oregon Constitution was adopted. The Court made clear – as it had done in the past – that Oregon's common law consisted of the court-made law as modified and amended by the English statutes passed before the American Revolution. Thus, statutes enacted after the Revolution (such as Lord Campbell's Act – the wrongful death statute on which Plaintiff attempted to rely) was not part of Oregon's common law.
Next, the Court rejected Plaintiff's argument challenging the "rule" that there was no common-law cause of action for wrongful death. Plaintiff attempted to rely on cases that she claimed demonstrated the existence of such a claim. However, those cases involved claims for loss of a property interest (usually loss of services of a slave or a child). The Court concluded that a few scattered cases that might have involved something more could not be said to have established the existence of a common-law cause of action for wrongful death. Further, the cases showed that the state Legislatures had "stepped into the breach" and enacted statutes providing for wrongful death actions, resulting in an end to efforts to develop a common-law cause-of-action.
Finally, the Court noted that Plaintiff was asking the Court to take two steps – first to conclude that a cause of action for wrongful death existed in 1857; and second to avoid any statutory limitation on such a claim. The Court concluded that even if it could take the first step – agree that there had been a general movement in the common law that, if left alone, might eventually have resulted in the recognition of a cause of action for wrongful death of the kind that Plaintiff now seeks to maintain (i.e., one that did not involve a claim for loss of a property interest but, instead, for the mental suffering, loss of society, companionship, etc., for which Plaintiff seeks compensation) – the Court could not conclude that the right would have been without limitation where the only evidence available was that the statutory claims being permitted at the time all included limitations on the scope of the recovery.
Right to a Jury Trial
Article I, section 17 of the Oregon Constitution provides: "In all civil cases, the right of Trial by Jury shall remain inviolate." The Supreme Court has made clear that Article I, section 17 does not create a substantive claim or theory of recovery. Instead, that section merely protects the right to a jury trial for claims in which such a right was recognized at the time the Oregon Constitution was adopted, and claims of like nature. Lawson v. Hoke, 339 Or 253, 267, 119 P3d 210 (2005); Jensen v. Whitlow, 334 Or 412, 422, 51 P3d 599 (2002). Thus, Plaintiff must establish a substantive right to a jury trial for wrongful death claims in order to have a right to a jury trial protected by the Oregon Constitution. The arguments Plaintiff made previously were addressed in Greist v. Phillips, in which the Court held that there was no constitutional violation because the right to a jury trial did not apply to wrongful death claims. Because such claims are purely statutory, and because Oregon's first wrongful death statute was enacted in 1862 (i.e., five years after the Constitution was drafted), there was no wrongful death cause-of-action when the Constitution was drafted and adopted. Therefore, no right to a jury trial in such an action
The Court added that even if Article I, section 17 did apply to wrongful death actions, it would not affect the cap on noneconomic damages because that Article I, section 17 never included a right to unfettered determination of damages by a jury. Id. That statement from Greist was subsequently overruled by the Supreme Court in Lakin v. Senco Products, Inc., 329 Or 62, 76, 987 P2d 463 (1999), in which the Court held unconstitutional application of the cap on noneconomic damages to negligence claims. The Court explained:
"Oregon courts never have had the power to reduce a jury's verdict or to enter a judgment for a lesser amount of damages over the objection of the prevailing party, who always could reject a judicial remittitur and demand a new jury trial."
329 Or at 76. The Court held that applying the cap to the jury's damage award interfered with the plaintiff's right to have the jury assess damages and, therefore, was unconstitutional. The Court added, however, that Greist was distinguishable because, unlike the claim in Lakin, Greist involved a wrongful-death action – a claim that was not recognized at common-law or under Territorial Law when the Oregon Constitution was adopted. Id. at 77.
The Supreme Court reiterated in Hughes that wrongful death actions are distinguishable from negligence action because the former are purely statutory claims, which were not recognized at common law, and the parameters of which subject to legislative adjustment. The Court rejected Plaintiff's efforts to treat wrongful-death actions as claims "of like nature" to personal injury actions, thus giving her the same right to a jury determination of damages that the Plaintiff had in Lakin. The Court stated that Plaintiff's "expansive claim," including her claim of a right to a jury determination of damages "unfettered by legislative or judicial interference," conflicts with the principle the Court had repeatedly invoked that Article I, section 17 "is not a source of law that creates or retains a substantive e claim or theory of recovery in favor of any party" and that as a result, Plaintiff is entitled to a jury determination of damages "both in type and amount, only to the extent that the substantive law, i.e., the statute, pertaining to her claim so provides."
Dissenting Opinions
Justices Durham and Walters both wrote dissenting opinions addressing Article I, section 17 – the right to a jury trial. Both focus on the historical analysis of that right, as discussed in the Supreme Court's opinion in State v. 1920 Studebaker Touring Car, 120 Or 254, 251 P 701 (1927). In that case, husband was arrested for driving wife's car while carrying a container of liquor. After the grand jury refused to indict, the state proceeded with a statutory proceeding in rem to forfeit the vehicle to the state. Wife entered into the proceeding, filing a statement of interest and challenging the statutory proceeding as denying her right to a jury trial. The Supreme Court agreed with wife.
In reaching that conclusion, the Court explained that the statutory right to a jury trial guaranteed by Article I, section 17 "embraces every case where it existed before the adoption of the Oregon Constitution, and it is not within the power of the Legislature to enact any law which deprives any litigant of that right." 120 Or at 259. The Court determined that forfeiture of a vehicle was analogous to imposition of a penalty for violation of a law, which was a proceeding traditionally involving a jury trial. The Court then explained how the jury trial right is analyzed – Oregon's court system was divided into three parts at statehood, and it was that three-part division that provided the context for the examination of the constitutional right to a jury trial in all civil cases:
"At the time when our state Constitution was adopted, courts were classified according to the nature and extent of their jurisdiction, their forms of proceeding, or the principles on which they administered justice, either as courts of admiralty, courts of equity or courts of law. Controversies concerning forfeitures of rights or property could be adjudicated only in some one or more of these courts, since in this country there were no other courts in which controversies of that nature could be adjudicated."
Id. at 261. Both dissenting Justices discussed the limitations on the various courts, the fact that the general jurisdiction of a court determined whether a jury was involved (i.e., claims in courts of law meant there was a right to a jury trial, while claims in courts of admiralty or courts of equity did not include a right to a jury trial), and that the question whether there was a right to a jury trial was not dependent on the specific nature of the claim but on which court had jurisdiction over the claim. Both Justices addressed the fact that the Studebaker methodology had been cited as the appropriate method of analysis for evaluating the right to a jury trial since 1927, and that the Court had never rejected that analysis. Finally, both Justices explained that because this case involved a civil action and Plaintiff's claim was an action at law, the claim fell within the jurisdiction of the court of law and, therefore, she had a right to a jury trial. Finally, both Justices noted that the fact that the claim was statutory in nature was not relevant, noting that the claim in Studebaker also was a statutory claim. Both argued that the majority had failed to explain in a satisfactory way why the methodology from Studebaker did not mean that Plaintiff had a right to a jury trial in Hughes.