FILED October 24, 2019 05:04 PM Appellate Court Records
IN THE SUPREME COURT OF THE STATE OF OREGON
SCOTT RAYMOND BUSCH, Multnomah County Circuit Court Case No. 15CV13496 Plaintiff-Appellant, Respondent on Review, Court of Appeals No. A164158 and Supreme Court No. S066098 DEANNE MARIE BUSCH,
Plaintiff,
v.
MCINNIS WASTE SYSTEMS, INC.,
Defendant-Respondent, Petitioner on Review.
McInnis Waste Systems, Inc.’s Opening Brief on the Merits
On Review of a Decision of the Court of Appeals on Appeal from a Judgment of the Multnomah County Circuit Court, by the Honorable Michael A. Greenlick
Court of Appeals opinion filed: July 18, 2018 Author: Ortega, P.J. Concurring: Garrett and Powers, J.
Julie A. Smith, OSB No. 983450 [email protected] Cosgrave Vergeer Kester LLP 900 SW Fifth Avenue, 24th Floor Portland, OR 97204 (503) 323-9000
Attorneys for Defendant-Respondent, Petitioner on Review October 2019
W. Eugene Hallman, OSB No. 741237 John Coletti, OSB No. 942740 [email protected] [email protected] Hallman Law Office Paulson Coletti 104 SE Fifth Street 1022 NW Marshall Street, Suite 450 PO Box 308 Portland, OR 97209 Pendleton, OR 97801 (503) 226-6361 (541) 276-3857
Attorneys for Plaintiff-Appellant, Respondent on Review
i
TABLE OF CONTENTS Page
INTRODUCTION ...... 1
QUESTIONS PRESENTED AND PROPOSED RULES OF LAW ...... 2
Questions Presented ...... 2
Proposed Rules of Law ...... 3
FACTS AND PROCEDURAL HISTORY ...... 4
SUMMARY OF ARGUMENT ...... 7
ARGUMENT ...... 10
A. Unlimited economic damages plus $500,000 in noneconomic damages is a substantial remedy in and of itself ...... 12
1. Greist is dispositive and precludes plaintiff’s challenge to ORS 31.710(1) ...... 13
2. Unlimited economic damages plus $500,000 in noneconomic damages is substantial in light of the nature and purpose of noneconomic damages ...... 16
a. There are no standards for measuring noneconomic damages in money, and there is no way of determining what placing a monetary value on them does for plaintiffs ...... 17
b. As a result, an award that includes $500,000 in noneconomic damages will always be “substantial” ...... 21
3. Unlimited economic damages plus $500,000 in noneconomic damages is substantial compared to the remedy in Horton ...... 23
ii
TABLE OF CONTENTS (cont.) Page
4. $3.5 million is substantial considering awards in other cases, noneconomic damage limits in other states, and minimum insurance requirements ...... 24
B. The court does not need to consider the historical context, the overall statutory scheme, or the legislature’s reasons ...... 26
C. ORS 31.710(1) does not violate the remedy clause, considering the historical context, the overall statutory scheme, and the legislature’s reasons for limiting noneconomic damages ...... 27
1. The growth in damage awards after World War II ...... 28
2. The expansion of tort rights in the 1960s and 1970s ...... 29
3. Efforts in the mid-1980s to stabilize Oregon’s tort and liability insurance systems ...... 32
a. The 1986 Governor’s Task Force on Liability ...... 32
b. The 1986 Joint Interim Task Force on Liability Insurance .... 33
c. The 1987 changes to tort and insurance law in Oregon ...... 35
4. The limit on noneconomic damages was meant to ensure that insurance coverage would be available to compensate tort victims ...... 42
5. The limit was a reaction to and a tradeoff of sorts for the earlier expansion of tort rights ...... 44
6. The limit was intended to ensure that essential service providers would continue to operate in Oregon ...... 45 iii
TABLE OF CONTENTS (cont.) Page
D. This court should defer to the legislature’s policy choices in meeting the changing needs of Oregonians ...... 46
E. Noneconomic damages should be limited to the extent permitted by the remedy clause ...... 48
CONCLUSION ...... 54
APPENDIX
iv
TABLE OF AUTHORITIES
Page Cases
Baker v. Pennsylvania Co., 142 Pa 503, 21 A 979 (1891) ...... 18
Bamford v. Pittsburgh & B. Traction Co., 194 Pa 17, 44 A 1068, 1069 (1899) ...... 18
Blake v. Midland Ry. Co., 118 Eng Rep 35, 18 QB 93, 111 (1852) ...... 17
Bowden v. Davis, 205 Or 421, 289 P2d 1100 (1955) ...... 21
Busch v. McInnis Waste Systems, Inc., 292 Or App 820, 426 P3d 820 (2018), rev allowed, ___ Or ___ (2019) ...... 1, 7, 49
Campbell v. Carpenter, 279 Or 237, 566 P2d 893 (1977) ...... 31
Chicago & A.R. Co. v. Fisher, 38 Ill App 33 (Ill App Ct 1890), aff'd, 141 Ill 614 (1892) ...... 18
Clarke v. OHSU, 343 Or 581, 175 P3d 418 (2007) ...... 13, 14, 16
Deckard v. Bunch, 358 Or 754, 370 P3d 478 (2016) ...... 31
DeMaris v. Whittier, 280 Or 25, 569 P2d 605 (1977) ...... 21
v
TABLE OF AUTHORITIES (cont.)
Page Cases (cont.)
DeMendoza v. Huffman, 334 Or 425, 51 P3d 1232 (2002) ...... 17
Doyle v. City of Medford, 356 Or 336, 337 P3d 797 (2014) ...... 52
Gale v. New York Cent. & H.R.R. Co., 53 How Pr 385 (1877), aff'd, 76 NY 594 (1879) ...... 18
Goddard v. Farmers Ins. Co. v. Oregon, 344 Or 232, 272-73 (2008) ...... 50
Goodhart v. Pennsylvania R. Co., 177 Pa 1, 35 A 191 (1896) ...... 18, 19
Greist v. Phillips, 322 Or 281, 906 P2d 789 (1995) ...... 2, 3, 5, 7 ,8, 11, 13-16, 22, 30
Heaton v. Ford Motor Co., 248 Or 467, 435 P2d 806 (1967) ...... 30
Hewitt v. SAIF, 294 Or 33, 653 P2d 970 (1982) ...... 49
Horton v. OHSU, 359 Or 168, 376 P3d 998 (2016) ...... 1, 4, 5, 10, 11, 13-15, 23, 24, 26, 43, 45, 46, 48, 53
Howell v. Boyle, 353 Or 359, 298 P3d 1 (2013) ...... 14, 15, 22
vi
TABLE OF AUTHORITIES (cont.)
Page Cases (cont.)
Jehovah’s Witnesses v. Mullen et al., 214 Or 281, 330 P2d 5 (1958), cert den, 359 US 436 (1959) ...... 21
Johnson v. Wells, Fargo & Co., 6 Nev 224 (1870) ...... 18
Langford v. Jones, 18 Or 307 (1890) ...... 17-18
Leeds v. Metro. Gas-Light Co., 90 NY 26 (1882) ...... 18
Levin v. Commerce Energy, Inc., 560 US 413, 130 S Ct 2323 (2010)...... 49-50
Li v. State, 338 Or 376, 110 P3d 91 (2005) ...... 49
Malloy v. Bennett, 15 F 371 (CCSD NY 1883) ...... 19
McCathern v. Toyota Motor Corp., 332 Or 59, 23 P3d 320 (2001) ...... 30
Moore Mill & Lbr. Co. v. Foster, 216 Or 204, 336 P2d 39 (1959) ...... 49
Noonan v. City of Portland, 161 Or 213, 88 P2d 808 (1939) ...... 47
vii
TABLE OF AUTHORITIES (cont.)
Page Cases (cont.)
Oliver v. North Pac. Transp. Co., 3 Or 84 (1869) ...... 17
Perozzi v. Ganiere, 149 Or 330, 40 P2d 1009 (1935) ...... 47
Rains v. Stayton Builders Mart, Inc., 289 Or App 672, 410 P3d 336 (2018) ...... 6
Sealey v. Hicks, 309 Or 387, 393-788 P2d 435 (1990) ...... 47
Smitson v. Southern Pac. Co., 37 Or 74, 60 P 907 (1900) ...... 17
Smothers v. Gresham Transfer, Inc., 332 Or 83, 23 P3d 333 (2001) ...... 10, 15, 16
State v. Dinsmore, 342 Or 1, 147 P3d 1146 (2006) ...... 49
State v. Moore/Coen, 349 Or 371, 245 P3d 101 (2010) ...... 49
State v. Rangel, 328 Or 294, 977 P2d 379 (1999) ...... 50
State v. Rodriguez/Buck, 347 Or 46, 217 P3d 659 (2009) ...... 50
State v. Unger, 356 Or 59, 333 P3d 1009 (2014) ...... 49
viii
TABLE OF AUTHORITIES (cont.)
Page Cases (cont.)
Towe v. Sacagawea, Inc., 357 Or 74, 347 P3d 766 (2015) ...... 31
Union Pac. Ry. Co. v. Milliken, 8 Kan 647 (1871) ...... 18
Vasquez v. Double Press Mfg., Inc., 288 Or App 503, 406 P3d 225 (2017), aff’d on other grounds, 364 Or 665, 437 P3d 1107 (2018) ...... 5, 6, 15
Vasquez v. Double Press Mfg., Inc., 364 Or 609, 437 P3d 1107 (2019) ...... 27
Western & A.R. Co. v. Young, 83 Ga 512 (1889) ...... 18
White v. Jubitz Corp., 347 Or 212, 219 P3d 566 (2009) ...... 41
Wights v. Staff Jennings, 241 Or 301, 405 P2d 624 (1965) ...... 30
Constitutional Provisions
Or Const, Art I, §8 ...... 50
Or Const, Art I, §9 ...... 49
Or Const, Art I, §10 ...... 1-4, 7, 10, 47, 51, 54
Or Const, Art I, §11 ...... 49
Or Const, Art I, §12 ...... 49 ix
TABLE OF AUTHORITIES (cont.)
Page Constitutional Provisions (cont.)
Or Const, Art I, §16 ...... 50, 51
Or Const, Art I, §18 ...... 49
Or Const, Art I, §20 ...... 49
Or Const, Art IV, § 1 ...... 47
Or Const, Art VII (Amended), § 3 ...... 53
Or Const, Art XVIII, § 7 ...... 47
US Const, Amend XIV ...... 50
Bills and Laws Or Laws 1961, ch 437, § 1 ...... 30
Or Laws 1967, ch 544, § 1 ...... 30
Or Laws 1971, ch 668, § 1 ...... 30
Or Laws 1979, ch 801, §§ 1-6 ...... 31
Or Laws 1979, ch 866, § 2 ...... 30
Or Laws 1979, ch 866, § 7 ...... 31
Or Laws 1987, ch 774, § 7 ...... 41
Or Laws 1987, ch 774, § 9 ...... 41
Or Laws 1987, ch 774, §§ 31-153 ...... 42 x
TABLE OF AUTHORITIES (cont.)
Page Bills and Laws (cont.)
Or Laws 1987, ch 774, § 34 ...... 42
Or Laws 1987, ch 774, § 37 ...... 42
Or Laws 1987, ch 774, § 46 ...... 42
Or Laws 1987, ch 774, §§ 71-93 ...... 42
Or Laws 1987, ch 774, § 73 ...... 46
ORS 31.600 ...... 30
ORS 31.710 ...... 1-13, 16, 21, 26, 27, 48, 51, 53, 54
ORS 35.305 ...... 49
Senate Bill (SB) 323 (1987)...... 27, 35, 39, 48
Rules
OAR 740-040-0020 ...... 25
ORCP 67 C ...... 21
Other Authorities
Alexander A. Bernhard, Damages for Personal Injury – The Law in Oregon, 44 Or L Rev 95 (1965) ...... 20, 28
James F. Blumstein, Making the System Work Better: Improving the Process for Determination of Noneconomic Loss, 35 NM L Rev 401 (2005) ...... 20 xi
TABLE OF AUTHORITIES (cont.)
Page Other Authorities (cont.)
Oscar G. Chase, Helping Jurors Determine Pain and Suffering Awards, 23 Hofstra L Rev 763 (1995) ...... 20
Dan B. Dobbs, 2 Law of Remedies, § 8.1(4) (2d ed 1993) ...... 19
G. Field, A Treatise on the Law of Damages (1876) ...... 18
Kathy T. Graham, 1987 Oregon Tort Reform Legislation: True Reform or Mere Restatement? 24 Willamette L Rev 283 (1988) ...... 41
F. Patrick Hubbard, The Nature and Impact of the “Tort Reform” Movement, 35 Hofstra L Rev 437 (2006) ...... 20
Stanley Ingber, Rethinking Intangible Injuries: A Focus on Remedy, 73 Cal L Rev 772 (1985) ...... 20
Louis L. Jaffe, Damages for Personal Injury: The Impact of Insurance, 18 Law and Contemporary Problems 219 (1953) ...... 20
Joseph H. King, Jr., Pain and Suffering, Noneconomic Damages, and the Goals of Tort Law, 57 SMU L Rev 163 (2004) ...... 28
Charles T. McCormick, Handbook on the Law of Damages 315 (1935) ...... 18
Philip L. Merkel, Pain and Suffering at Mid-Twentieth Century: A Retrospective View of the Problem and the Legal Academy’s Responses, 34 Capital University L Rev 545 (2006) ...... 20, 28, 29
Jeffrey O’Connell & Keith Carpenter, Payment for Pain and Suffering Through History, 50 Insurance Counsel J 411 (1983) ...... 17, 28
xii
TABLE OF AUTHORITIES (cont.)
Page Other Authorities (cont.)
Jeffrey O’Connell & Rita James Simon, Payment for Pain & Suffering: Who Wants What, When & Why? 1972 Ill L F 1 (Appendix V) ...... 17
Paul v. Niemeyer, Awards for Pain and Suffering: The Irrational Centerpiece of Our Tort System, 90 Va L Rev 1401 (2004) ...... 20
Marcus L. Plant, Damages for Pain and Suffering, 19 Ohio State L J 200 (1958) ...... 29
Restatement (Second) of Torts § 903, cmt a (1979) ...... 19
Gary T. Schwartz, The Beginning and the Possible End of the Rise of Modern American Tort Law, 26 Georgia L Rev 601 (1992) ...... 29, 30
Anthony J. Sebok, The Fall and Rise of Blame in American Tort Law, 68 Brooklyn L Rev 1031 (2003) ...... 29, 30
T. Sedgwick, 1 A Treatise on the Measure of Damages § 171 (9th ed 1912) ..... 18
Christopher Sprague, Damages for Personal Injury and Loss of Life-the English Approach, 72 Tulane L Rev 975 (1997) ...... 20
UCJI 70.02 ...... 21
Charles A. Wright, Damages for Personal Injuries: Foreward, 19 Ohio State L J 155 (1958) ...... 28-29
Harry Zavos, Monetary Damages For Nonmonetary Losses: An Integrated Answer To The Problem Of The Meaning, Function, And Calculation of Noneconomic Damages, 43 Loyola L Rev 193 (2009) ...... 20
1
INTRODUCTION
This is a negligence case arising out of an accident involving a garbage truck owned by defendant. Defendant admitted liability, so the only issue for the jury to decide was the amount of the damages to award. The jury awarded
$13,521,922 on plaintiff’s negligence claim, including $3,021,922 in economic damages and $10,500,000 in noneconomic damages. The trial court granted defendant’s motion to reduce plaintiff’s noneconomic damages award to
$500,000, as required by ORS 31.710(1), and entered a general judgment in favor of plaintiff in the amount of $3,521,922. Plaintiff appealed, seeking reversal and remand for entry of judgment on the full amount of the verdict.
The sole issue on appeal was whether applying the $500,000 limit on noneconomic damages in ORS 31.710(1) violated the remedy clause in Article
I, section 10, of the Oregon Constitution,1 as construed in Horton v. OHSU, 359
Or 168, 376 P3d 998 (2016). The Court of Appeals held that it did. See Busch v. McInnis Waste Systems, Inc., 292 Or App 820, 426 P3d 820 (2018), rev allowed, ___ Or ___ (2019). For the reasons set forth below, the decision of the
Court of Appeals should be reversed, and the judgment of the trial court should be affirmed.
1 Article I, section 10, provides:
“No court shall be secret, but justice shall be administered, openly and without purchase, completely and without delay, and every man shall have remedy by due course of law for injury done him in his person, property, or reputation.” 2
QUESTIONS PRESENTED AND PROPOSED RULES OF LAW
Questions Presented
1. Does this court’s decision in Greist v. Phillips, 322 Or 281, 290-
91, 906 P2d 789 (1995), preclude plaintiff’s remedy-clause challenge?
2. If Greist is not dispositive, will an award that includes unlimited economic damages plus up to $500,000 in noneconomic damages always be
“substantial” given the nature and purpose of noneconomic damages?
3. To the extent the limit in ORS 31.710(1) is susceptible to a remedy-clause challenge, what role should other factors (including the historical context, the overall statutory scheme, and the legislature’s policy reasons for enacting ORS 31.710(1)) play in determining whether ORS
31.710(1) violates the remedy clause?
4. To the extent ORS 31.710(1) is susceptible to a remedy-clause challenge, does it violate the remedy clause as applied in this case in light of the nature and purpose of noneconomic damages, the historical context, the overall statutory scheme, and the legislature’s policy reasons for enacting ORS
31.710(1)?
5. If ORS 31.710(1) violates the remedy clause as applied to a particular case, should its limit on noneconomic damages be applied to the extent permitted by Article I, section 10?
3
Proposed Rules of Law
1. In Greist, this court held that a remedy that includes “100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” for purposes of Article I, section 10. 322 Or at 2901. This holding is dispositive and precludes plaintiff’s remedy-clause challenge.
2. There are no standards for measuring subjective, nonmonetary losses (i.e., noneconomic damages) in money, and there is no way of determining what placing a monetary value on them actually does for a plaintiff. This makes limits on noneconomic damages far less susceptible to a remedy-clause challenge than limits on damages for economic losses. To the extent that the “substantive limit” the remedy clause places on the legislature’s authority is that plaintiffs are generally entitled to a “substantial” remedy for a breach of a recognized duty, given the nature and purpose of noneconomic damages, an award that includes unlimited economic damages plus up to
$500,000 in noneconomic damages will always be “substantial.”
3. Because the remedy here is substantial in and of itself, the court does not need to consider other factors, including the historical context, the overall statutory scheme, and the legislature’s policy reasons for enacting ORS
31.710(1). To the extent these other factors do matter, the court’s role in assessing them should be limited to considering whether the legislature acted for a legitimate public purpose. 4
4. To the extent ORS 31.710(1) is susceptible to a remedy-clause challenge, it does not violate the remedy clause as applied in this case because the historical context, the nature and purpose of noneconomic damages, the overall statutory scheme, and the legislature’s policy reasons for enacting ORS
31.710(1) make it clear that the legislature acted for a legitimate public purpose when it chose to limit noneconomic damages to $500,000. If these factors should be “measured against” the extent to which the legislature has departed from the common law model, as Horton suggests, they support the conclusion that ORS 31.710(1) does not violate the remedy clause.
5. If the court concludes that the $500,000 limit on noneconomic damages violates the remedy clause as applied in a particular case, the court should not dismiss in its entirety the reasoned policy decision the legislature made when it enacted ORS 31.710(1). Consistent with its approach in other contexts, the court should instead give due regard to the legislature’s policy choice by limiting the noneconomic damage award to the extent permitted by
Article I, section 10.
FACTS AND PROCEDURAL HISTORY
Plaintiff lost part of his left leg, just above the knee, when he was hit by a garbage truck owned by defendant, while crossing a street in downtown
Portland. Tr 68, 370, 498, 920-21, 926. Defendant admitted liability, leaving damages as the only issue for the jury to decide. When the jury returned a 5 verdict awarding plaintiff $3,021,922 in economic damages and $10,500,000 in noneconomic damages, defendant moved to reduce the noneconomic damages to $500,000, as required by ORS 31.710(1). ER 1-2.2 In a lengthy written opinion, the trial court granted the motion, rejecting plaintiff’s as-applied remedy-clause challenge to ORS 31.710(1):
“First, * * * Clarke [v. OHSU, 343 Or 581, 175 P3d 417 (2007)], was the only Oregon Supreme Court case where a capped award was found to be paltry or insubstantial. Second, Griest [sic] emphasized the significance of receiving a complete recovery of economic damages in upholding a $500,000 noneconomic damage award. Third, Horton upheld the recovery of a capped award representing only 25 percent of the jury award, notwithstanding that the plaintiff did not receive a complete recovery of economic damages. Fourth, the legislative purpose underlying SB 323 – to reduce the cost of insurance premiums and increase insurance accessibility to Oregonians – is of significant importance.”
ER 65 (citations omitted). Plaintiff appealed, challenging the trial court’s remedy-clause ruling.
After this case was fully briefed on appeal, but before oral argument, the Court of Appeals ruled in Vasquez v. Double Press Mfg., Inc., 288 Or App 503, 406
P3d 225 (2017), aff’d on other grounds, 364 Or 665, 437 P3d 1107 (2018), that applying the $500,000 limit on noneconomic damages in ORS 31.710(1) to the award in that case violated the remedy clause, as construed in Horton. In reaching that decision, the Court of Appeals concluded that Greist was not
2 The jury also awarded plaintiff’s wife $400,000 on her loss of consortium claim, and the trial court entered a separate, limited judgment in her favor for that amount. 6 controlling because, the court explained, the holding in that case applies only in wrongful-death cases. Vasquez, 288 Or App at 523-24. The Court of Appeals also concluded that ORS 31.710(1) is not part of an “identifiable” quid pro quo but was instead enacted only for the purpose of controlling “costs” – i.e., the cost of litigation and, in turn, the cost of insurance. Id. at 524-25. And that cost-control “reason,” the court said, did not justify limiting the noneconomic damages of a 21-year-old plaintiff who was rendered permanently paraplegic after being crushed by a bale-cutting machine. Id. at 525.
Relying on Vasquez, the Court of Appeals ruled the same way in Rains v.
Stayton Builders Mart, Inc., 289 Or App 672, 410 P3d 336 (2018), a case that also involved a permanently paraplegic plaintiff. Again, the court held that the legislature’s cost-control “reason” (singular) for enacting ORS 31.710(1) did not justify limiting the noneconomic damages the jury awarded to the plaintiff and his wife. Rains, 289 Or App at 691.
The Court of Appeals decision in this case followed suit with the others.
The court (1) ruled that this case is “indistinguishable” from Vasquez and
Rains; (2) “declined to revisit” its earlier conclusion about the legislature’s reasons for enacting ORS 31.710(1); (3) “reject[ed]” defendant’s assertion that limits on noneconomic damages are less susceptible to a remedy-clause challenge than limits on damages for economic losses; and (4) said it was
“unpersuaded” that it was “authorized” to remedy the constitutional infirmity it 7 had found in ORS 31.710(1). Busch, 292 Or App at 824-25 and n 2.
Accordingly, the court reversed and remanded for entry of “judgment consistent with the jury’s damages award.” Id. at 824-825.
Defendant petitioned for and this court allowed review to determine whether applying the $500,000 limit on noneconomic damages in ORS
31.710(1) to the verdict violates the remedy clause and, if so, whether the limit should be applied to the extent permitted by Article I, section 10.
SUMMARY OF ARGUMENT
In Greist, this court held that ORS 31.710(1) does not violate the remedy clause because a remedy that includes “100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” in and of itself for remedy-clause purposes. This court has never overruled Greist or otherwise called its broadly worded and unqualified holding into question.
Thus, to the extent the “substantive limit” that the remedy clause places on the legislature’s authority is that plaintiffs are generally entitled to a “substantial” remedy for a breach of a recognized duty, Greist’s holding precludes plaintiff’s remedy-clause challenge.
The result is the same, however, even if Greist is not dispositive.
Although damages for noneconomic damages are “compensatory,” they are not compensatory in the same way as damages for pecuniary losses. There are no standards for measuring subjective, nonmonetary losses in money, and there is 8 no way of determining what placing a monetary value on subjective, nonmonetary losses actually does for a plaintiff. This makes limits on noneconomic damages far less susceptible to a remedy-clause challenge than limits on damages for economic losses. It follows that this court correctly decided in Greist that “100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” for remedy-clause purposes in and of itself.
There being no question of substantiality in this case, the court does not need to consider whether other factors, such as the historical context, the overall statutory scheme, or the legislature’s policy reasons for enacting ORS
31.710(1), bear on the statute’s constitutionality.
In any event, the historical context and legislative history reveal that the legislature limited noneconomic damages and enacted numerous insurance statutes at the same time in an effort to preserve the earlier expansion of tort rights in the 1960s and 1970s, which had widened the classes of plaintiffs who could recover in tort and increased the amount of damages that some plaintiffs could recover for some torts, while ensuring that liability insurance coverage would be available to provide meaningful compensation to tort plaintiffs and that essential service providers would continue to operate in Oregon.
When the tort law changes from the 1960s and 1970s made it harder for individuals and businesses to obtain liability insurance coverage, putting some 9 tort plaintiffs in jeopardy of not being compensated for their losses and driving essential service providers out of business, the legislature could have returned to the tort system of the past or pulled back on some of the expansions. It chose instead to accomplish its goals in other ways – by limiting noneconomic damages, by regulating insurers, and by enacting other statutes aimed at expanding the availability of insurance.
Identifying the changing needs of society, and weighing how best to address them, are matters the Oregon Constitution delegates expressly to the legislature. If the court does have occasion to evaluate the legislature’s reasons for enacting ORS 31.710(1), as the Oregon Liability Reform Coalition
(ORLRC) and the National Federation of Independent Businesses (NFIB) demonstrate in their amicus brief, the court’s role in evaluating the statute’s constitutionality should be limited to considering whether the legislature acted for a legitimate public purpose. As it has done in many contexts, in making that determination, this court should defer to the considered judgment of the legislature on the need to adjust the common law on noneconomic damages, judgment the legislature exercised after thoughtfully and deliberately considering the recommendations of two separate task forces, after reviewing thousands of pages of written materials, and after holding dozens of hearings.
Even if the court’s role in applying the remedy clause’s “substantive limit” on the legislature’s authority is to “measure” factors such as the historical 10 context, the overall statutory scheme, and the legislature’s reasons “against” the extent to which the legislature has departed from the common law model, as
Horton suggests, these other factors weigh heavily in favor of holding that ORS
31.710(1) does not violate the remedy clause. In light of the nature and purpose of noneconomic damages, the historical context, the overall statutory scheme, and the legislature’s policy reasons for enacting ORS 31.710(1), the court should hold that ORS 31.710(1) does not violate the remedy clause as applied in this case.
Finally, if the court hold that ORS 31.710(1) does violate the remedy clause, then it should limit the noneconomic award to the extent permitted by
Article I, section 10.
ARGUMENT
In Horton, this court held that Article I, section 10, places a “substantive limit” of some kind on the legislature’s authority to alter or adjust common law remedies. This substantive limit is not tied to the common law remedies as they existed in 1857, as the court had concluded in Smothers v. Gresham Transfer,
Inc., 332 Or 83, 119-20, 23 P3d 333 (2001), but recognizes that the legislature has the constitutional prerogative to alter or adjust a person’s remedy for personal injuries. Horton, 359 Or at 175, 183, 187-88, 193, 220, 218. After reaching these conclusions in Horton about the remedy clause, the function of the legislature, and the relationship between the two, the court then attempted to 11 describe the “substantive limit” that the remedy clause places on the legislature’s authority by synthesizing its earlier remedy-clause cases, which, the court said, generally looked to whether the legislature had left a remedy that was substantial in and of itself or substantial “in light of the overall statutory scheme” or whether the legislature had changed a common law remedy in response to the changing needs of society. Id. at 218-21. Ultimately, however, the court declined to “articulate a single unifying principle” and to “limit” its holding to “the circumstances” that the case presented. Id. at 220, 225.
The question presented here is whether the $500,000 limit on noneconomic damages in ORS 31.710(1) violates the remedy clause as applied in this case. As explained below, ORS 31.710(1) does not violate the remedy clause when viewed through any of the substantive-limit lenses the court described in Horton. Assuming that the substantive limit the remedy clause places on the legislature’s authority is that plaintiffs are entitled to a
“substantial” remedy for a breach of a recognized duty, there is no remedy clause problem here because, as this court correctly concluded in Greist, an award that includes unlimited economic damages plus up to $500,000 in noneconomic damages is a substantial remedy in and of itself.
There being no question of substantiality, there is no reason for the court to determine whether the remedy, as limited by ORS 31.710(1) is “substantial in light of the overall statutory scheme” or whether the reasons the legislature 12 had for enacting ORS 31.710(1) justify the departure it made from the common- law model. In any event, as detailed below, the remedy is “substantial” in light of the overall legislative package in which ORS 31.710(1) was adopted, which included several provisions that were specifically aimed at ensuring that liability insurance coverage would be available to provide meaningful compensation to tort victims for their injuries. Additionally, the historical context and legislative history reflect that the legislative package that included
ORS 31.710(1) was adopted to meet the changing needs of society. For any or all of these reasons, ORS 31.710(1) does not violate the remedy clause, and the trial court properly applied ORS 31.710(1) to the verdict in this case.
A. Unlimited economic damages plus $500,000 in noneconomic damages is a substantial remedy in and of itself To the extent the substantive limit the remedy clause places on the legislature’s authority is that plaintiffs are generally entitled to a “substantial” remedy for a breach of a recognized duty, there is no remedy-clause problem here because, as explained next, for several reasons, an award that includes unlimited noneconomic damages plus up to $500,000 in noneconomic damages is a substantial remedy in and of itself.
13
1. Greist is dispositive and precludes plaintiff’s challenge to ORS 31.710(1) On the question of substantiality, this court’s holding in Greist – that
“100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” – is dispositive and controlling.
Greist was an action against a trucking company whose driver struck a van, killing an infant. When the trial court applied the $500,000 limit on noneconomic damages to the jury’s $1.5 million noneconomic damages award, the plaintiff appealed, claiming that the limit violates the remedy clause. This court rejected that argument, concluding that limits on damages do not violate the remedy clause if they leave the plaintiff with a “substantial remedy” and holding that “100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” for remedy-clause purposes.
Greist, 322 Or at 290-91 (emphasis added).
This court has never overruled Greist or otherwise called its broadly worded and unqualified holding into question. To the contrary, starting with
Clarke v. OHSU, 343 Or 581, 175 P3d 418 (2007), and continuing up to and including Horton, this court has consistently recognized that the Greist approach to the remedy clause – which focuses on the extent to which the plaintiff will recover his or her economic damages – applies in personal injury cases (and not just wrongful-death cases, as the Court of Appeals concluded). 14
Clarke involved a $200,000 limit on all of the plaintiff’s damages, which included over $12 million in economic damages and $5 million in noneconomic damages. In determining whether the $200,000 limit left the plaintiff with a substantial remedy, the court did not discuss the effect the $200,000 limit would have on the plaintiff’s noneconomic damages. Rather, following the approach established in Greist, the court focused on the extent to which the plaintiff would be able to recover the $12 million in economic damages:
“[T]he statutory damage limitation at issue in Greist allowed recovery of 100 percent of any economic damages and up to $500,000 in noneconomic damages. * * * Placing no limit on recovery of economic damages allowed the plaintiffs to recover fully their out-of-pocket losses * * *.
“* * * * *
“We view * * * economic damages of over $12 million as representative of the enormous cost of lifetime medical care [for this plaintiff’s] severe personal injuries[.] * * * [T]he legislature has completely eliminated an injured person’s preexisting right to obtain a full recovery of those damages from the individual tortfeasors who negligently caused the injuries.” Clarke, 343 Or at 609 (emphasis added); see also Horton, 359 Or at 195
(“Clarke focused solely on whether the capped damages of $200,000 was a
‘substantial’ remedy in light of the economic damages that the plaintiff had suffered”) (emphasis added).
Later, in Howell v. Boyle, 353 Or 359, 298 P3d 1 (2013), this court ruled that the holding in Greist is not limited to or binding only in wrongful death cases: 15
“* * * The dissent ignores the court’s holding in Greist. According to the dissent, the decision actually was predicated on the fact that recoveries for wrongful death historically were quite low. * * * But that is simply not what the court in Greist said. Rather, * * * the court held that [the award] was a substantial award, in and of itself. * * *
“The dissent also suggests that * * * Greist has limited precedential value because it involved the application of the remedy clause to claims for wrongful death * * *. This is a curious criticism. That this court later held that its remedy clause analysis does not apply to wrongful death claims, * * * in no way suggests that the remedy clause analysis itself was wrong. In fact, in subsequent Article I, section 10, cases, this court has continued to cite and discuss Greist * * * in describing its remedy clause analysis. Clarke, for example, contains extensive discussions of * * * Greist * * * without any suggestion that [it] has limited precedential value.”3 353 Or at 379-80; cf. id. at 395-96 and n 5 (De Muniz, J., dissenting) (asserting that Greist is not “applicable” because it is “a wrongful-death case,” the remedy for which had “historically” been low).
Greist remains good law. In overruling Smothers in the course of deciding Horton, this court expressly reaffirmed all of the remedy-clause cases it had decided pre-Smothers, including Greist, which was decided in 1995. See
Horton, 359 Or at 218 (“[W]e reaffirm our remedy clause decisions that preceded Smothers.”).
3 The Court of Appeals must have overlooked this passage from Howell when it incorrectly concluded in Vasquez that the “holding in Greist is limited to wrongful-death claims based on the historical limitations placed on those claims.” 288 Or App at 523-24 (emphasis added). 16
In deciding whether ORS 31.710(1) violates the remedy clause as-applied in this case, this court does not need to look any farther than its holding in
Greist. Consistent with that holding, the court should hold that the $3.5 million remedy plaintiff recovered in this case does not violate the remedy clause because, as in Greist, the remedy included 100 percent of plaintiff’s economic damages plus $500,000 in noneconomic damages and is therefore a substantial remedy in and of itself.
2. Unlimited economic damages plus $500,000 in noneconomic damages is substantial in light of the nature and purpose of noneconomic damages This court did not explain in Greist why a remedy that includes unlimited economic damages plus $500,000 in noneconomic damages is substantial in and of itself. Nor did it explain in Clarke why it chose to focus its remedy-clause analysis solely on the extent of the plaintiff’s unremediated economic damages.
The subtext of Greist and Clarke seems to be, however, that noneconomic damages are different. As explained below, noneconomic damages are not compensatory in the same way that damages for pecuniary losses are, and the difference makes limits on noneconomic damages far less susceptible to a remedy-clause challenge.
17
a. There are no standards for measuring noneconomic damages in money, and there is no way of determining what placing a monetary value on them does for plaintiffs Although under early English common law, “a plaintiff typically could recover compensatory damages only for tangible injuries to which an exact monetary value could be attached,” DeMendoza v. Huffman, 334 Or 425, 437-
38, 51 P3d 1232 (2002), by the mid-1800s, English courts recognized that injured plaintiffs should be allowed to recover a “solatium” for their “mental suffering along with an indemnity for [their] pecuniary loss.” Blake v. Midland
Ry. Co., 118 Eng Rep 35, 18 QB 93, 111 (1852).4
This court, like most American courts, was quick to adopt the view that an award for compensatory damages could include a sum for pain and suffering, see, e.g., Oliver v. North Pac. Transp. Co., 3 Or 84, 88 (1869), but it did so with the understanding that pain and suffering awards are not compensatory in precisely the same way that pecuniary damages are. When it comes to pain and suffering, the court explained, only “relative compensation” is possible;
“absolute compensation * * * is not attainable.” Smitson v. Southern Pac. Co.,
37 Or 74, 96, 60 P 907 (1900) (emphasis added); see also Langford v. Jones, 18
4 See also Jeffrey O’Connell & Keith Carpenter, Payment for Pain and Suffering Through History, 50 Insurance Counsel J 411, 412- 13 (1983) (discussing early English and American cases on pain and suffering); Jeffrey O’Connell & Theodore M. Bailey, The History of Payment for Pain & Suffering, printed as Appendix V to Jeffrey O’Connell & Rita James Simon, Payment for Pain & Suffering: Who Wants What, When & Why? 1972 Ill L F 1, 83-100 (same; also canvasing early treatises). 18
Or 307, 328 (1890) (quoting from a jury instruction that referred to damages for
“trouble, pain, and suffering” as “something like compensation”).
Early decisions in other states similarly reflected the understanding that pain and suffering could not truly be measured “in money,” Goodhart v.
Pennsylvania R. Co., 177 Pa 1, 14-15, 35 A 191 (1896), there being “no market in which the price of a voluntary subjection of one’s self to pain and suffering can be fixed.” Baker v. Pennsylvania Co., 142 Pa 503, 510, 21 A 979 (1891).5
5 See also Johnson v. Wells, Fargo & Co., 6 Nev 224, 240 (1870) (“it is absolutely impossible to measure mental agony by money”); Union Pac. Ry. Co. v. Milliken, 8 Kan 647, 655–56 (1871) (it is “radically, intrinsically wrong” to try to measure compensation for pain and suffering by “market value,” reasoning that “there can be no sale; for we can find no purchaser”); Gale v. New York Cent. & H.R.R. Co., 53 How Pr 385, 389-90 (1877), aff'd, 76 NY 594 (1879) (no “standard by which the damages caused by physical pain and suffering are to be measured” can “be found in any commercial or legal table.”); Leeds v. Metro. Gas-Light Co., 90 NY 26, 29-30 (1882) (“For pain and suffering, or injuries to the feelings, there can be no measure of compensation, save the arbitrary judgment of a jury.”); Western & A.R. Co. v. Young, 83 Ga 512, 197 (1889) (pain and suffering compensation must be “qualified or relative” (as opposed to absolute) to ensure that money is left “with which to compensate others”); Chicago & A.R. Co. v. Fisher, 38 Ill App 33, 42 (Ill App Ct 1890), aff'd, 141 Ill 614 (1892) (“Strictly speaking, there can be no compensation for pain and suffering, neither can the value of a limb be determined in money. There is no market value for either[.]”); Bamford v. Pittsburgh & B. Traction Co., 194 Pa 17, 20, 44 A 1068, 1069 (1899) (“an allowance” is “made in damages for pain and suffering, by way of compensation”); see generally G. Field, A Treatise on the Law of Damages 533 (1876) (recognizing that compensation for pain and suffering “cannot be accurately estimated in dollars and cents”); T. Sedgwick, 1 A Treatise on the Measure of Damages § 171 (9th ed 1912) (quoting with approval from Leeds); Charles T. McCormick, Handbook on the Law of Damages 315, 318 (1935) (recognizing that there is no “standard by which to measure pain and suffering in money” and that “[t]ranslating pain and anguish into dollars can, at best, be only an arbitrary allowance, and not a process of measurement”). 19
For this reason, the “word ‘compensation,’ in the phrase ‘compensation for pain and suffering,’” was not “understood as meaning price or value” but was seen instead as “describing an allowance looking towards recompense,” Goodhart,
177 Pa at 14–15 (emphasis added), or as a “solatium,” Malloy v. Bennett, 15 F
371, 373 (CCSD NY 1883).
The nature and purpose of noneconomic damages have not changed in any meaningful way since the 1800s. As Dobbs succinctly puts it, the primary purpose of noneconomic damages remains largely a “symbolic” one. Dan B.
Dobbs, 2 Law of Remedies, § 8.1(4), 399 (2d ed 1993). “[D]amages for pain and suffering are not compensation in any ordinary sense that they make the plaintiff whole or replace what has been lost, * * * since there is no market in pain and suffering by which the damages could be estimated” and “there is almost no standard for measuring pain and suffering damages, or even a conception of those damages or what they represent.” Id. at 382-836; see also
Restatement (Second) of Torts § 903, cmt a (1979) (recognizing that there is “no
6 As Dobbs explains, “the result is that verdicts vary enormously, raising substantial doubts whether the law is evenhanded in the administration of damage awards or whether in fact it merely invites the administration of biases for or against individual parties.” Id. at 398-99; see also U.S. Chamber of Commerce et al Amicus Br (discussing horizontal inequities among noneconomic damage awards for similar injuries).
20 scale” for measuring noneconomic damages and that they do not “restore the injured person to his previous position”).7
7 See generally Harry Zavos, Monetary Damages For Nonmonetary Losses: An Integrated Answer To The Problem Of The Meaning, Function, And Calculation of Noneconomic Damages, 43 Loyola L Rev 193, 243 (2009) (there is no “objective-societal metric with which to translate” noneconomic losses “into dollars”; they are a “symbolic sum,” which juries use to “offset a loss that cannot be eliminated by that sum”); F. Patrick Hubbard, The Nature and Impact of the “Tort Reform” Movement, 35 Hofstra L Rev 437, 495-96 (2006) (“money for pain and mental trauma cannot literally restore the plaintiff to status quo ante”); Philip L. Merkel, Pain and Suffering at Mid-Twentieth Century: A Retrospective View of the Problem and the Legal Academy’s Responses, 34 Capital University L Rev 545, 567 (2006) (courts have “openly acknowledged” that noneconomic damages are “not really compensatory” and that there is “no reasonable way to measure them”); James F. Blumstein, Making the System Work Better: Improving the Process for Determination of Noneconomic Loss, 35 NM L Rev 401, 403 (2005) (in awarding noneconomic damages, “[t]he jury, in essence, is expected to appraise a house without looking at comparable sales”); Paul v. Niemeyer, Awards for Pain and Suffering: The Irrational Centerpiece of Our Tort System, 90 Va L Rev 1401, 1416 (2004) (awards for pain and suffering do not “compensate,” “indemnify,” or “provide restitution to the injured party” but are instead intended as a “bonus * * * thought roughly to reference the pain suffered or expected to be suffered”); Christopher Sprague, Damages for Personal Injury and Loss of Life- the English Approach, 72 Tulane L Rev 975, 1005 (1997) (“The principal problem so far as damages for nonpecuniary loss are concerned is, of course, that an attempt is being made to compensate the plaintiff, in monetary terms, for something that has no monetary value.”); Oscar G. Chase, Helping Jurors Determine Pain and Suffering Awards, 23 Hofstra L Rev 763, 765 (1995) (“An inescapable reality of the pain and suffering conundrum is that tort law requires the monetization of a ‘product’ for which there is no market and therefore no market price”); Stanley Ingber, Rethinking Intangible Injuries: A Focus on Remedy, 73 Cal L Rev 772, 781-82 (1985) (pain and suffering damages are a “symbolic” means of “making amends”); Alexander A. Bernhard, Damages for Personal Injury – The Law in Oregon, 44 Or L Rev 95, 106 (1965) (damages for pain and suffering are not “strictly compensable”); Louis L. Jaffe, Damages for Personal Injury: The Impact of Insurance, 18 Law and Contemporary Problems 219, 224 (1953) (noneconomic damages “may be a consolation, a solatium”). 21
In Oregon, “noneconomic damages” are defined in ORS 31.710(2)(b) only as “subjective, nonmonetary losses.” The definition is followed by a nonexclusive list of potential types of losses but not with any guidance on how they should be measured or calculated because “[t]here is no standard for the measurement of pain and suffering,” i.e., noneconomic damages. DeMaris v.
Whittier, 280 Or 25, 29, 569 P2d 605 (1977). Instead, Oregon juries are
“merely instructed [to] award such sum as will reasonably compensate the plaintiff.” Id.; see also UCJI 70.02 (instructing jurors that there is no “fixed standard” for measuring noneconomic damages and that they should use their
“considered judgment” in determining a “reasonable” amount). And the only real limit on the amount of noneconomic damages the jury may award is the plaintiff’s prayer. ORCP 67 C. In light of all this, there is simply no way of determining what placing a particular monetary value on a particular plaintiff’s nonmonetary losses actually does for that particular plaintiff.
b. As a result, an award that includes $500,000 in noneconomic damages will always be “substantial” The bar for declaring a statute unconstitutional is a high one. This court
“will not declare a law unconstitutional except in clear cases,” Bowden v. Davis,
205 Or 421, 433, 289 P2d 1100 (1955), and after resolving “all doubt” in favor of the statute’s validity. Jehovah’s Witnesses v. Mullen et al., 214 Or 281, 293,
330 P2d 5 (1958), cert den, 359 US 436 (1959). 22
Although damages for noneconomic damages are “compensatory,” they are not compensatory in the same way that damages for pecuniary losses are.
There are no standards for measuring subjective, nonmonetary losses in money, and there is no way of evaluating what placing a monetary value on these losses actually does for a particular plaintiff. This makes limits on noneconomic damages far less susceptible to a remedy-clause challenge than limits on damages for economic losses. Without a standard for measuring noneconomic damages in the first place, there can be no standard or scale the court can adopt for measuring the point at which a $500,000 statutory limit on noneconomic damages would become constitutionally inadequate. Lines of that sort cannot be drawn with the kind of clarity and conviction the constitution requires.
It follows that this court was correct when it ruled in Greist that “100 percent of economic damages plus up to $500,000 in noneconomic damages is a substantial amount” for remedy-clause purposes in and of itself. 322 Or at 291; see also Howell, 353 Or at 379-80 (concluding that the award in Greist was a
“substantial award, in and of itself”). Accordingly, to the extent the substantive limit the remedy clause places on the legislature’s authority is that plaintiffs are generally entitled to a “substantial” remedy for a breach of a recognized duty, unlimited economic damages plus up to $500,000 in noneconomic damages must be “substantial” for remedy-clause purposes.
23
3. Unlimited economic damages plus $500,000 in noneconomic damages is substantial compared to the remedy in Horton The remedy in this case is substantial in and of itself when it is compared to the remedy in Horton.
In Horton, the trial court refused to apply a $3 million Oregon Tort
Claims Act (OTCA) limit on damages to a $12 million verdict, which awarded
$6 million in economic damages and $6 million in noneconomic damages for an infant who, as a result of a physician’s negligence, had to endure a liver transplant, removal of his spleen, various additional surgeries, and a lifetime of medical monitoring. On review, this court held that the $3 million statutory remedy was substantial for remedy-clause purposes, even though the remedy covered only about half of the plaintiff’s economic losses and about 25 percent of the total damages awarded by the jury. Horton, 359 Or at 224.
In light of the differences between economic and noneconomic damages discussed above, if the $3 million, 25-percent remedy in Horton was substantial, even though it deprived the plaintiff of half of the awarded economic damages, then the $3.5 million, 26-percent remedy here, which compensates plaintiff for all of his economic damages, must be substantial too.
It is true that this court’s decision in Horton did not turn solely on the size of the remedy. It also turned on the “presence of the state’s constitutionally recognized interest in sovereign immunity” and the “quid pro quo” the OTCA provides. Id. at 225. But the legislature’s reasons for the OTCA limit came in 24 to play in Horton only because the limit left the plaintiff with a significant amount of unremediated economic losses, drawing the substantiality of the remedy into question and causing the court to look for something else in the statutory scheme to make the remedy “substantial.” See Horton, 359 Or at 219,
221 (stating that the “overall statutory scheme” will, in some cases, make a remedy “substantial”).
In this case, by contrast, plaintiff recovered 100 percent of his economic losses plus $500,000 in noneconomic damages, for a total of $3.5 million. The statutory remedy beat the statutory remedy in Horton by a sizeable amount – i.e., by more than $500,000, with a greater percentage. More importantly, plaintiff has been left with absolutely no unremediated economic losses.
4. $3.5 million is substantial considering awards in other cases, noneconomic damage limits in other states, and minimum insurance requirements Other factors also support the conclusion that the $3.5 million remedy plaintiff recovered in this case is “substantial” in and of itself. See generally
Horton, 359 Or at 220-21 (recognizing that “other factors” can come into play in determining whether a remedy is substantial).
First, $3.5 million is substantial when compared to awards in other catastrophic injury and death cases. See ER 14-15 (listing reported appellate decision involving significant noneconomic damages awards); ER 13
(comparing the remedy in this case to awards in other remedy-clause cases).
While each case is different, how juries have awarded and how courts have 25 treated noneconomic damages in other similar cases shows that the “100 percent plus $500,000” remedy the legislature chose is “substantial.”
Second, Oregon’s $500,000 limit on noneconomic damages is well within the range of limits imposed in a variety of other states, some of which, in fact, are significantly lower. See U.S. Chamber of commerce et al Amicus Br
(listing state statutes).
Third, $3.5 million greatly exceeds the minimum insurance requirements for auto and truck accidents. See Clark, 343 Or at 612 and n 1 (Balmer, J., concurring) (suggesting that the amount of insurance “private individuals and institutions” tend to carry provides “some indication of the kinds of claims” they “ordinarily face” and the “kind of remedy for those claims” that will likely be viewed as “substantial” for remedy-clause purposes). Plaintiff’s individual award of $3.5 million and the $3.9 million combined award to plaintiff and his wife far exceed the per-person and per-accident minimum requirements for cars and trucks. See ORS 806.070(2) (requiring coverage of at least $25,000 per person and $50,000 per accident for cars); OAR 740-040-0020 (requiring coverage of at least “$750,000 per accident” for motor carriers).8
8 If the amount of liability insurance that tortfeasors tend to carry is indeed a factor courts will consider in evaluating substantiality, it would not make sense to consider how much coverage the largest institutions would tend to carry because many (if not most) tortfeasors are individuals or small businesses, and the remedy-clause analysis has to work the same way regardless of the defendant. It cannot apply one way when the defendant is a national chain and another way when the defendant is a mom-and-pop shop. Plaintiffs, of course, do not get to pick their tortfeasors. 26
Each of these factors lends further support for the conclusion that the statutory remedy of $3.5 million is substantial in and of itself.
B. The court does not need to consider the historical context, the overall statutory scheme, or the legislature’s reasons In Horton, the court attempted to describe the “substantive limit” the remedy clause places on the legislature’s constitutional prerogative by synthesizing its earlier remedy-clause cases, which, the court said, generally looked to whether the legislature had left a remedy that was substantial in and of itself or substantial “in light of the overall statutory scheme” or whether the legislature had changed a common law remedy in response to the changing needs of society. Id. at 218-21.
To the extent that a substantive limit that the remedy clause places on the legislature’s authority is that plaintiffs are generally entitled to a “substantial” remedy for a breach of a recognized right, then the remedy clause analysis in this case ends with the conclusion that the statutory remedy in this case is substantial in and of itself. Put differently, there being no question of substantiality here, there is no reason for the court to determine whether the remedy is “substantial in light of the overall statutory scheme” or whether the reasons the legislature had for enacting ORS 31.710(1) justify the departure it made from the common-law model. Because the remedy is substantial in and of itself, the historical context, the overall statutory scheme, and the legislature’s reasons for limiting noneconomic damages do not come into play. 27
In any event, as explained next, these factors also support the conclusion that ORS 31.710(1) does not violate the remedy clause.
C. ORS 31.710(1) does not violate the remedy clause, considering the historical context, the overall statutory scheme, and the legislature’s reasons for limiting noneconomic damages In Vasquez v. Double Press Mfg., Inc., 364 Or 609, 628-99, 437 P3d
1107 (2019), this court recognized that ORS 31.710(1) was enacted as part of a
“major piece of legislation” the legislature assembled “in reaction to earlier changes in the law affecting tort liability” with an “overarching goal of reducing the costs of insurance by reducing the liability of defendants in tort actions.” While both of these things are true – the legislature was reacting to an unprecedented expansion of tort rights and liability and one of the legislature’s goals was to reduce costs – this court’s description of Senate Bill
(SB) 323 (1987) in Vasquez only tells part of the story. As explained below, the historical context and legislative history reflect that the primary goals of the bill in general and of ORS 31.710(1) in particular were (1) to ensure that liability insurance coverage would be available to provide meaningful compensation to tort plaintiffs; and (2) to meet the changing needs of society. Viewing the issue through either or both of these lenses brings further focus on why ORS
31.710(1) does not violate the remedy clause.
28
1. The growth in damage awards after World War II
For most of American history, noneconomic damage awards received little attention, likely because verdicts in personal-injury cases were generally small. Merkel, 34 Capital University L Rev at 560, 566. That began to change, however, after World War II, when damage awards in general, and noneconomic damage awards in particular, starting growing at a “spectacular” pace. Id. at 560-61, 566; O’Connell and Carpenter, 50 Insurance Counsel J. at
413-15; Joseph H. King, Jr., Pain and Suffering, Noneconomic Damages, and the Goals of Tort Law, 57 SMU L Rev 163, 170 (2004).
The upward trend in damage awards was attributed (at least in part) to state-enacted insurance requirements, which, in turn, led to a “tremendous growth in liability insurance coverage.” Merkel, 34 Capital University L Rev at
562. With the increased availability of insurance, more accident victims were able to recover meaningful compensation for their injuries. Id. at 563.9
In the late 1950s, some members of the legal community began questioning whether noneconomic damages were still “socially justifiable” and whether “society could afford to continue paying them.” Id. at 565-66; Charles
9 One report from the 1930s indicated that most accident victims from that era did not receive any compensation at all. If the tortfeasor was uninsured (and most were), the injured plaintiff only had about a 25 percent chance of recovering anything. Merkel, 34 Capital University L Rev at 561. During that time, awards in excess of $10,000 were rare. Id. at 568; see also Bernhard, 44 Or L Rev at 111 (listing damage awards in Oregon from 1912 and 1959 that exceeded $10,000 and were affirmed by the Oregon Supreme Court). 29
A. Wright, Damages for Personal Injuries: Foreward, 19 Ohio State L J 155,
156-57 (1958). Some proposed eliminating noneconomic damages altogether,
“preferring to devote society’s limited resources to fully compensating accident victims for their economic losses, rather than directing resources to intangible injuries.” Merkel, 34 Capital University L Rev at 572 (emphasis added).
Others looked into ways to make noneconomic damages “more predictable,” id. at 566, suggesting that a “maximum limit” could be adopted, perhaps as a tradeoff for “modifying the contributory negligence rule.” Marcus L. Plant,
Damages for Pain and Suffering, 19 Ohio State L J 200, 210-11 (1958).
2. The expansion of tort rights in the 1960s and 1970s
Tort rights also expanded in the decades following World War II.
“Virtually all commentators, regardless of their particular normative views, agree that, as a matter of empirical fact, courts and legislatures changed tort doctrine” in the 1960s and 1970s “in ways that made it easier for injured persons to recover.” Anthony J. Sebok, The Fall and Rise of Blame in
American Tort Law, 68 Brooklyn L Rev 1031, 1031 (2003); see also Gary T.
Schwartz, The Beginning and the Possible End of the Rise of Modern American
Tort Law, 26 Georgia L Rev 601, 603 (1992) (“Between 1960 and the early
1980s, there had been continuous liability-rule innovations in almost all areas of tort law.”). These changes included, among other things, the development of new tort theories for liquor liability, strict product liability, informed consent, 30 and emotional distress, as well as the abolishment of certain defenses, including contributory negligence, assumption of the risk, and immunities for charities, governments, and family members. Sebok, 68 Brooklyn L Rev at 1033-34;
Schwartz, 26 Georgia L Rev at 605-606.
Oregon was no different. During the same era, the Oregon legislature and this court expanded tort rights and remedies in a variety of ways. Consider, for example, wrongful death claims. In its original form, the statute authorizing claims for wrongful death limited a plaintiff’s recovery to only $5,000 in total damages. Greist, 322 Or at 296. In the 1960s, the legislature first increased the statutory limit to $25,000 and then repealed the limitation altogether. Or Laws
1961, ch 437, § 1; Or Laws 1967, ch 544, § 1.
During the 1960s, this court recognized a common-law claim for strict product liability for the first time. See generally Wights v. Staff Jennings, 241
Or 301, 405 P2d 624 (1965); Heaton v. Ford Motor Co., 248 Or 467, 435 P2d
806 (1967). Years later, the legislature enshrined the tort in statute. See Or
Laws 1979, ch 866, § 2; see also McCathern v. Toyota Motor Corp., 332 Or 59,
72-73, 23 P3d 320 (2001) (discussing the history of strict product liability in
Oregon).
In 1971, the legislature replaced the doctrine of contributory negligence, including assumption of the risk, with a comparative fault system. Or Laws
1971, ch 668, § 1 (codified as ORS 31.600). “Under the contributory 31 negligence doctrine, any negligence by a plaintiff was a complete bar to the plaintiff’s ability to recover damages from a defendant who was also at fault, regardless of the degree of the plaintiff’s or the defendant’s negligence.” Towe v. Sacagawea, Inc., 357 Or 74, 107, 347 P3d 766 (2015). Comparative fault, by contrast, would allow the plaintiff to recover as long as he or she was not “more responsible for the injuries than all other actors combined.” Id. at 107.10
The 1970s also saw dramatic changes to Oregon’s liquor liability laws.
In Campbell v. Carpenter, 279 Or 237, 243-44, 566 P2d 893 (1977), this court recognized for the first time that a tavern owner may be liable in tort for damages inflicted off-premises on a third party by a patron who was served alcohol while visibly intoxicated. See Deckard v. Bunch, 358 Or 754, 770, 370
P3d 478 (2016) (noting that this theory was recognized for the first time in
Campbell). In 1979, the legislature codified this liquor liability theory, and lifted the bar on some guest passenger claims. Or Laws 1979, ch 801, §§ 1-6;
Or Laws 1979, ch 866, § 7; see also Deckard, 358 Or at 788 (observing that the
1979 statute “endorsed” Campbell).
10 When it adopted comparative fault, the legislature was told that doing so would not lead to a significant increase in insurance costs. See Minutes, House Judiciary Committee, Subcommittee II, HB 1343, Mar 11, 1971 (indicating that insurance costs would be increased to some degree but that the increase would not be significant). 32
3. Efforts in the mid-1980s to stabilize Oregon’s tort and liability insurance systems The expansion of tort rights in the 1960s and 1970s, and the accelerated growth in tort awards that started in 1950s, destabilized the tort and liability insurance systems in ways that affected almost every participant – individuals, businesses, service providers, insurers, tortfeasors, and tort victims. In 1986, the governor and the legislature each convened a task force to study the problem and recommend changes to Oregon’s tort and insurance laws.
a. The 1986 Governor’s Task Force on Liability
The Governor’s Task Force on Liability was charged with studying and offering recommendations aimed at balancing the need to address the “cost” and “availability” of insurance with the need to ensure that “claimants are compensated fairly and equitably.” App 5, 7. One of the problems the task force identified in its numerous work sessions was that the nature and purpose of noneconomic damage awards made them “volatile and unpredictable,” which
“directly affect[ed] the cost and availability of liability insurance.” App 36.
Among other things, the Governor’s task force proposed that noneconomic damages awards be limited to “$100,000 in aggregate for all plaintiffs” and that the common law collateral source rule be modified to prevent plaintiffs from recovering a “windfall” in pecuniary compensation. App 9, 14. It also recommended a number of changes to the insurance statutes that were targeted 33 specifically at improving the availability and affordability of insurance. App
20-23.
b. The 1986 Joint Interim Task Force on Liability Insurance
The legislature’s Joint Interim Task Force on Liability Insurance was similarly charged with studying and recommending changes to Oregon tort and insurance laws. Over a 10-month period, the legislative task force heard testimony from more than 100 groups and individuals, including tort victim advocates and small and large businesses, many of whom described difficulties they had encountered obtaining insurance of any kind, let alone affordable insurance. The availability of insurance had become a particular problem for certain essential services providers, including day cares, midwives, and truckers. When they could not find coverage, individuals and businesses stopped providing services altogether or were forced to operate without any insurance, reducing the chances that tort victims would be able to recover meaningful compensation for their injuries. See generally App 88, 93, 96-97,
106, 110-11, 118-19, 141, 144-47, 154, 163, 173, 210-11.
Among other things, the legislative task force considered evidence that the “availability and affordability” problems were directly related to the expansion of tort rights in the 1960s and 1970s, which had made predicting losses difficult for insurers. App 99; see also App 130 (suggesting that tort law changes were warranted “in light of the changes to common law doctrine 34 already initiated by his legislature”); App 137-38 (discussing how the history- driven, rate-making process for insurance becomes problematic when “new” and “different” tort claims arise unexpectedly); App 165 (agreeing that the changing tort law created “uncertainty” and instability); App 188 (indicating that “unlimited” awards and “new law[s]” contributed to an “availability” problem and that a noneconomic damages limit would bring “certainty back into the system”).
While the focus of the legislative task force was on making changes to tort and insurance laws that would improve the “availability” and
“affordability” of insurance, it was also concerned about how the changes would affect “Oregonians” in general and whether overregulation might drive insurers out of Oregon, thereby exacerbating the “availability” problem. App
88, 194-95, 198, 204-08, 211-12. To address these concerns, the task force ultimately recommended a number of changes to Oregon’s tort and insurance laws, including a limit on noneconomic damages in the amount of $500,000 and numerous other proposals aimed at improving the availability and affordability of insurance and making it more difficult for insurers to cancel or refuse to renew individual policies and whole lines of insurance. App 201, 204-08.
35
c. The 1987 changes to tort and insurance law in Oregon
The legislative task force presented their proposals to the legislature in
1987. App 201-13. Numerous groups, including a coalition of local businesses, representatives from the insurance industry, the Oregon Trial
Lawyers Association (OTLA), and the Oregon Association of Defense Counsel
(OADC), testified in support of and opposition to various aspects of the 156- section package in SB 323 (1987).
Some proponents of the proposal to limit noneconomic damages described it as a tradeoff of sorts for the expansion of tort rights in the 1960s and 1970s. As one proponent put it, limiting noneconomic damages was not just about “insurance”; it was also a response to the “broadening” of “tort liability” that had occurred over the past 20 years, including the shift to comparative fault, which had “made it easier for plaintiffs to recover.” Tape
Recording, Senate Committee on Judiciary, SB 323, Feb 3, 1987, Tape 14, Side
A (statement of John Holmes); App 238-40 (minutes from the February 3, 1987 hearing).
In that proponent’s view, the legislature needed to make a choice between taking one or more of the expanded tort rights away or making them
“more financially realistic for everyone” by limiting noneconomic damages:
“[T]here have been policy reasons for broadening some areas of liability. I think there are also policy reasons for making it more financially realistic for everyone. * * * My point is to not go through and criticize strict liability in tort, comparative negligence. 36
That’s another way to attack the problem, by the way. But that’s not the way that I’m going to suggest to this committee. “* * * * *
“[T]he question is whether or not society can continue to afford to pay unlimited amounts for noneconomic damages and generally continue to support a tort system that by anyone’s admission * * * does not award damages to all victims, is expensive and cumbersome to operate, * * * and in my judgment, is currently failing to operate in a practical manner to achieve its proper purpose.
“* * * * *
“[Y]ou could * * * go through all of the enactments, legislative, and take a look at all the court decisions that have been broadening liability from the 1960s on and take them on one by one so that you don’t have such a broadened basis of liability. That’s another thing that could be done. I don’t recommend that. But that’s something that the legislature could consider.
“* * * * *
“There’s another way other than taking it on one by one. * * * And that relates to section 11 of your bill, which relates to some sort of a limit on noneconomic damages.” Tape Recording, Senate Committee on Judiciary, SB 323, Feb 3, 1987, Tape
14, Side A (statement of John Holmes) (emphasis added).11
11 See also id., Tape 15, Side A (Holmes) (stating that tort law changes in Oregon have “all” been going “one way” and that “it’s time” to “go the other way”); id. (Kip Lombard) (observing that the limit is not just about stabilizing insurance but is also a “policy” question); id., Tape 14, Side B (Senator Cohen) (stating that the debate should be about the “equities” of the tort system and whether “redistribution” is warranted); App 238-42 (minutes from the February 3, 1987 hearing); Tape Recording, Senate Judiciary Committee, SB 323, Jan 20, 1987, Tape 1, Side A (Chairman Frye) (explaining that the interim task force considered “How far as a matter of policy are we willing to go to narrow the remedies that are presently available * * *?”); id. (Kip Lombard) (discussing the “expansion of traditional negligence” and need for “significant changes” in the tort system “which, in turn, is the basis for the risk assessment by those who 37
Other proponents of limiting noneconomic damages specifically focused on what a limit would do to improve the insurance “availability and affordability” problems, which were causing some individuals and businesses to operate without insurance. In operating without insurance, they were not just putting their own assets on the line; they were also putting tort victims at risk of not recovering meaningful compensation for their injuries. See App 155
(OTLA: “Insurance exists to protect policyholders from ruin, and to provide meaningful compensation to tort victims.”).
The insurance coverage problems had been attributed in part to the difficulty insurers had predicting the scope and extent of tort liability in Oregon, and limiting noneconomic damages was seen as one way of making tort liability in Oregon less variable and more predictable, which would lead to more coverage, which (in turn) would make more money available to compensate tort victims for the wide range of tort rights that were available to them in 1987.
See, e.g., App 174 (noting that remittitur was not available in Oregon and that
are willing or unwilling to insure that responsibility”); App 194-95 (minutes from the January 20, 1987 hearing); App 225 (“The question of reform involves creating a balance between compensation for those who are injured and the finite resources of society”; “Society cannot continue to pay unlimited amounts for non-economic losses”); App 233 (referring to the “greater uncertainty in measuring risks” caused by the expansion of tort rights); App 245-46 (discussing the shift from contributory negligence as a complete defense to a negligence action to comparative fault, which “made it easier for injured persons to recover”); App 248 (“Can society continue to afford to pay unlimited amounts for non-economic damages, such as pain and suffering?”); App 294 (referring to tort expansions starting in the 1960s). 38 limiting noneconomic damages would allow courts to modify awards that are not currently “modifyable”); App 217 (“[d]amage awards must bear some predictable and reasonable relationship to actual economic injury”); App 223
(“[t]he proposed changes shift the available dollars for the civil justice system to benefit the victim and society.”); App 224 (“[s]tability must be brought to the legal system to avoid the unpredictability of upwardly spiraling numbers”); App
235 (damages for noneconomic losses “should be more predictable”); App 242
(indicating that the purpose of the limit is to make the insurance system more stable and predictable); App 248-49 (suggesting that the “current lack of predictability of non-economic damages is a fundamental part of the problem”);
App 252 (indicating that the limit would also help “keep losses within available insurance coverage”); App 265-66 (repeatedly referring to the need for
“predictability”); App 275 (“[f]rom the perspective of either the victim of injury or the insured, the risk created by the unavailability or unaffordability of liability coverage is beyond the bounds of modern tolerance”); App 305
(indicating that availability will be improved by predictability).
In the end, the legislature chose the amount and the scope of the statutory limit on noneconomic damages after considerable debate. The Governor’s task force had recommended a limit on noneconomic damages in the amount of
“$100,000 in the aggregate for all plaintiffs.” App 9. The legislative task force had recommended a $500,000 limit except in “cases of serious physical 39 impairment and serious disfigurement.” App 201. And, during the numerous legislative hearings on SB 323, legislators and stakeholders explored limits of various sizes – including $150,000, $250,000, $300,000, $400,000, and
$550,000. App 240, 253, 270, 289-94, 301-02, 305, 309, 312, 314.
Ultimately, the legislature settled on a $500,000 across-the-board limit after hearing that including exceptions to the limit would undermine the goal of predictability and that it might take 20 years for a $500,000 limit to have a significant effect on the “affordability” of insurance. App 266-67, 270, 293,
301. The legislature was told, however, that a $500,000 limit would increase
“stability” and “predictability” in the meantime, which, in turn, would help with the “availability” problem:
“[WITNESS]: The cap is an attempt to try and put some calculability or some stability in the ability to monitor severity. * * * [W]e can understand and calculate the economic loss. [I]t’s the noneconomic loss that has the intangible and has the limit that is the sky in effect. So the cap [is meant to] give stability and predictability, as the insurance companies talk about, for the future so that there would be some basis for predicting more accurately. We also felt that it would tend to attract [insurers to the] market – so that we wouldn’t be in the situation like we were in 1975 when all the companies left * * *.”
“ * * * * *
“[REPRESENTATIVE DIX]: * * * I’m just curious. Why place the cap there [at $500,000]? Is that for the future? * * * One of the actuaries noted that in the future you know with inflation and so on maybe 20 years from now a cap of $400 or $500,000 may begin to have some impact on what is now the $100 to $300,000 range.
40
“[WITNESS]: I think there’s no question that the impact will be in the future. * * * That is a great reason for it. * * * I think we can only say that what we are doing is reaching to the future with some predictability.
“* * * * *
“* * * The social policy question * * * is: How are we going to balance? And, you know, if we all had our druthers, we’d give unlimited compensation to those who are tragically injured. It’s getting too expensive. So we are having to make some changes somewhere. And our tort claims act – we’ve done that. You know, we have the limitation there of only $100,000 – no matter what. And so you’re in a balancing position of saying: Is this state’s policy going to say that for a certain type of damage as a social issue we must cap it? And, to me, if we [include exceptions], which sound[] good, I think we lose the very thing we’re trying to do. * * *
“* * * * *
“* * * [Y]ou not only have the cost factor, but you have the availability factor. And in those states where we have this type of tort reform, I think we send some kind of a signal to those that are out in the insurance business that [in] this state you have a little bit more predictability and a little more security. * * * Availability in addition to cost is a big factor * * *.” Tape recording, House Judiciary Committee, Subcommittee 1, SB 323, May 22,
1987, Tape 630, Side A (statement of Tom Cooney) (emphasis added); App
303-04 (minutes from the May 22, 1987 hearing); see also App 315
(acknowledging that, while the limit “might seem arbitrary, the subcommittee was trying to enhance availability through predictability”).
In addition to limiting noneconomic damages, the legislature also decided to make some adjustments to the rules on joint and several liability. It enacted a statute providing that tortfeasors would no longer be jointly responsible for 41 noneconomic damages and making tortfeasors jointly and severally responsible for economic damages only if the tortfeasor was fifteen percent or more responsible for the plaintiff’s injuries. Or Laws 1987, ch 774, § 7 (App 319).
But instead of substantially modifying the common law collateral source rule as both task forces recommended (App 14, 202), or eliminating the rule altogether as some states have done and a number of people requested (App
220, 224, 235-37), the legislature made only minor changes to it, see Or Laws
1987, ch 774, § 9 (App 319), thus preserving for plaintiffs the right to continue to recover economic damages from tortfeasors “even if, due to insurance or benefits * * * they do not suffer out-of-pocket loss, and the damages therefore serve no compensatory purpose.” White v. Jubitz Corp., 347 Or 212, 241, 219
P3d 566 (2009); see also Kathy T. Graham, 1987 Oregon Tort Reform
Legislation: True Reform or Mere Restatement? 24 Willamette L Rev 283, 310
(1988) (describing the “modification to the collateral source rule” as having
“little substance” and characterizing most of the other 1987 tort-law changes as
“minimal”).
Additionally, at the risk of making the insurance market in Oregon even less attractive to insurers and thus exacerbating the “availability” problem (a concern shared by a number of people, see, e.g., App 88-89, 195), the legislature enacted a variety of significant insurance regulations, including ones: (1) prohibiting commercial liability insurers from withdrawing, failing to 42 renew, or canceling any line of insurance or class of business without prior approval, Or Laws 1987, ch 774, § 34 (App 324-25); (2) restricting the ability of commercial liability insurers to cancel a particular policy before the policy expires, Or Laws 1987, ch 774, § 37 (App 325); and (3) requiring prior approval of commercial liability insurance policy forms in which defense costs are included in the policy limits (also known as “wasting” policies), Or Laws
1987, ch 774, § 46 (App 326). See generally Or Laws 1987, ch 774, §§ 31-153
(App 324-50).
Finally, on top of all of this, the legislature enacted several statutes that were geared toward creating new liability insurance coverage in areas that were particularly hard-hit by the “availability” problem. See, e.g., Or Laws 1987, ch
774, §§ 71-93 (App 332-336).
4. The limit on noneconomic damages was meant to ensure that insurance coverage would be available to compensate tort victims With respect to insurance, the historical context and the legislative history described above reflect that the noneconomic damages limit served at least two purposes. It was offered to insurers as a consolation for the insurance regulations the legislature ended up adopting as part of the package, the purpose of which was to make it more difficult for insurers to stop or limit coverage
(and thus ensure that insurance coverage would be available to compensate tort victims). And it was offered to induce insurers to write more policies in Oregon
(and thus ensure that insurance coverage would be available to compensate tort 43 victims). The legislature understood that a limit on noneconomic damages would make it easier for insurers to predict losses, which would then make the
Oregon insurance market more attractive to insurers (insurance regulations aside). Meanwhile, the new insurance statutes would add new lines of coverage and prevent some insurers from withdrawing, failing to renew, or canceling policies or lines of insurance.
The legislature expected that both efforts – the limit on noneconomic damages and the various insurance statutes enacted with it – would make insurance more widely available in Oregon to “protect policyholders from ruin and * * * provide meaningful compensation to tort victims.” App 155
(emphasis added). Making insurance more widely available would, among other things, ensure that a stable pool of money would be available to pay damage awards like the one in this case, just as the waiver of sovereign immunity did in the OTCA context in Horton. Put another way, like in Horton, the limit at issue here was part of a quid pro quo that imposed burdens on some tort victims in exchange for benefits extended to other tort victims and to society in general. See Horton, 359 Or at 219-20 (observing that the legislature’s “reasons” for reducing a benefit for some “can matter” and the
“reasons” sometimes include extending benefits to others).
44
5. The limit was a reaction to and a tradeoff of sorts for the earlier expansion of tort rights The historical context and legislative history also reflect that the limit on noneconomic damages was a response to the earlier expansion of tort rights, the most notable one being the legislature’s 1971 decision to allow contributorily negligent plaintiffs to recover in tort. In making sweeping changes to the tort system in the 1960s and 1970s, the legislature and this court widened the class of plaintiffs who could recover in tort and increased the amount of damages that some plaintiffs could recover for some torts. When these changes to tort law in
Oregon proved expensive in the years that followed, the legislature could have returned to the tort system that was in place in the 1950s or pulled back on some of the expansions that were made in the 1960s and 1970s. Doing so would certainly have accomplished the legislature’s goal of making insurance more widely available, which, in turn, would have ensured that a pool of money would be available to provide meaningful compensation to tort victims. But the legislature chose instead to accomplish its goals another way – by limiting noneconomic damages. To the extent the limit was a tradeoff for the expansion of rights in general, the legislature imposed burdens on some plaintiffs in exchange for the benefits others had already received in the 1960s and 1970s.
To the extent the noneconomic damages limit was a tradeoff for the abolition of contributory negligence in particular, the legislature imposed a burden on non- 45 negligent plaintiffs in exchange for the benefit negligent plaintiffs received when contributory negligence was abolished.
Either way, the noneconomic damages limit the legislature adopted in
1987 was a tradeoff for expanded rights tort victims had already been benefitting from and for the legislature’s decision not to retract the expanded rights when the expansions proved problematic. In this respect, too, the limit was part of a quid pro quo that imposed burdens on some tort victims in exchange for benefits to others and society in general. See Horton, 359 Or at
219-20.
6. The limit was intended to ensure that essential service providers would continue to operate in Oregon Finally, the limit on noneconomic damages was seen by the legislature as necessary to protect individuals and business (like defendant) who provide essential services in Oregon and to ensure that they would continue to provide services here. The legislature saw the insurance affordability and availability problem as a particular threat to essential services – so much so that it made express findings, detailing these concerns:
“(a) Some business and service providers in Oregon have experienced major problems in both the availability and affordability of commercial liability insurance. Premiums for such insurance policies have recently grown as much as 500 percent and the availability of such insurance in Oregon markets has greatly diminished.
“(b) These businesses and service providers are essential to achieve goals such as increased work force productivity, family 46
self-sufficiency and the maintenance and improvement of the health of the citizens of Oregon. The lack of adequate commercial liability insurance threatens these businesses and service.” Or Laws 1987, ch 774, § 73 (App 332-33) (emphasis added); see also App 231
(“A number of * * * service providers * * * have ceased [offering] services because insurers are not offering adequate levels of liability insurance at any price.”); App 241 (observing that the problem, if left unaddressed, could turn into an “economic development issue”).
D. This court should defer to the legislature’s policy choices in meeting the changing needs of Oregonians The legislative history of the overall statutory scheme that included the
$500,000 limit on noneconomic damages thus reflects that, when the legislature adopted the limit, it was exercising its constitutional prerogative to alter a common law remedy to meet the changing needs of Oregonians. As this court recognized in Horton, identifying those needs, and weighing how best to address them, are matters the constitution delegates expressly to the legislature.
See Horton, 359 Or at 183, 193, 218, 220 (recognizing that the Oregon
Constitution gives the legislature the prerogative to “alter or repeal the common law” and that “one of the functions of the legislature is to adjust * * * the remedies for a breach of [a] duty as societal conditions change”).
As the ORLRC and NFIB explain in their amicus brief, when the early remedy-clause cases that were tainted by the same flawed reasoning that
Smothers relied on are weeded out of the mix, the remedy-clause cases that 47 remain make it clear that the only “substantive limit” that Article I, section 10 places on the legislature’s remedy-altering prerogative is that the legislature can alter the common law model only if it acts with a legitimate public purpose, i.e., for the purpose of meeting the changing needs of Oregonians. See, e.g., Sealey v. Hicks, 309 Or 387, 393-788 P2d 435 (1990) (concluding that the substantive limit the remedy clause puts on the legislature’s authority is that the legislature must act for a legitimate legislative purpose, i.e., “for the purpose of protecting a recognized public interest”); Noonan v. City of Portland, 161 Or 213, 252, 88
P2d 808 (1939) (rejecting remedy clause challenge to city charter provision, exempting the city from liability for a defective sidewalk, because the provision was a valid exercise of legislative power, which the court had “no power to disregard”); Perozzi v. Ganiere, 149 Or 330, 351, 40 P2d 1009 (1935) (rejecting remedy clause challenge to statute that eliminated guest-passenger claim because the legislature “may well have” thought “there were sound social reasons for denying a recovery for negligence”).12
If this court decides that the “100 percent plus $500,000” statutory remedy in this case is not substantial in and of itself, then the court should take the opportunity here to clarify that its only role in an “insubstantial” remedy
12 See also Or Const, Art IV, § 1 (“The legislative power of the state, except for the initiative and referendum powers reserved to the people, is vested in a Legislative Assembly, consisting of a Senate and a House of Representatives.”); Or Const, Art XVIII, § 7 (giving the legislature the prerogative to alter or repeal the common law). 48 case is to determine whether the legislature acted for a legitimate purpose. In such cases, this court has a constitutional obligation to defer to the considered judgment of the legislature on how best to address the changing needs of society – judgment the legislature exercised with respect to SB 323 (1987) after an extensive amount of study and deliberation. As long as the legislature has acted for a legitimate public purpose (which it clearly did here), then the legislature has the constitutional prerogative to leave a plaintiff with an
“insubstantial” remedy (or with no remedy at all).
But even if the court determines that its proper role in applying the remedy clause’s “substantive limits” really is to “measure” the legislature’s policy reasons for enacting ORS 31.710(1) against the extent to which the legislature has departed from the common law model, as Horton suggests, the court should conclude that ORS 31.710(1) does not violate the remedy clause as applied in this case given the nature and purpose of noneconomic damages, the total amount of the statutory remedy, the historical context, the overall statutory scheme, and the legislative history described above.
E. Noneconomic damages should be limited to the extent permitted by the remedy clause After holding that ORS 31.710(1) is unconstitutional as applied in this case, the Court of Appeals declined to apply ORS 31.710(1) to the extent the constitution permits, as defendant suggested. Instead, the court reversed the trial court’s judgment and remanded for entry of “judgment consistent with the 49 jury’s damages award.” Busch, 292 Or App at 824-825 and n 2. As explained below, that was not the proper “remedy” for the constitutional infirmity the
Court of Appeals found.
It is well settled that courts have the “constitutional authority” to fashion an appropriate “remedy” for a constitutional violation. Li v. State, 338 Or 376,
397-98, 110 P3d 91 (2005). When the state obtains evidence as a result of a violation of a criminal defendant’s constitutional rights, courts will typically exclude the evidence as a remedy for the violation. See, e.g., State v. Unger,
356 Or 59, 85-87, 333 P3d 1009 (2014) (Article I, section 9); State v. Dinsmore,
342 Or 1, 10, 147 P3d 1146 (2006) (Article I, section 11); State v. Moore/Coen,
349 Or 371, 384, 245 P3d 101 (2010) (Article I, section 12). When the state takes property through the process of eminent domain, Article I, section 18, of the Oregon Constitution, gives the owner the right to a constitutionally adequate remedy in the form of “just compensation.”13 If the legislature makes a policy choice that is unconstitutionally underinclusive, in violation of Article I, section
20, of the Oregon Constitution, courts will remedy the statutory defect by
“extend[ing] the coverage of the statute” if doing so will “maintain the objective sought to be achieved by the statute.” Hewitt v. SAIF, 294 Or 33, 52,
653 P2d 970 (1982); see also Levin v. Commerce Energy, Inc., 560 US 413,
13 Although there is no constitutional right to a jury trial on the issue of compensation in an eminent domain proceeding, Moore Mill & Lbr. Co. v. Foster, 216 Or 204, 225, 336 P2d 39 (1959), the statutory procedures contemplate a jury trial, ORS 35.305. 50
426-47, 130 S Ct 2323 (2010) (“courts may attempt, within the bounds of their institutional competence, to implement what the legislature would have willed had it been apprised of the constitutional infirmity”). If a statute is written so broadly that, by its terms, it appears to proscribe speech Article I, section 8, of the Oregon Constitution protects, courts will often read the constitutionally required limits into the statute. See, e.g., State v. Rangel, 328 Or 294, 303, 977
P2d 379 (1999). If the legislature exceeds its authority to set criminal sentences in violation of Article I, section 16, of the Oregon Constitution, then the court will decrease the sentence in a particular case, so it comports with the constitution. See, e.g., State v. Rodriguez/Buck, 347 Or 46, 80, 217 P3d 659
(2009). Finally, when a jury oversteps its constitutional bounds by rendering a punitive damages verdict that violates the Due Process Clause of the Fourteenth
Amendment to the United States Constitution, in lieu of rejecting the verdict altogether, courts endeavor to fashion a remedy that complies with due process while also paying respect to the jury’s decision by determining the “maximum constitutionally permissible award” – i.e., “the highest amount of punitive damages that may be awarded in th[e] case, without violating [the] defendant’s rights under the Due Process Clause.” Goddard v. Farmers Ins. Co. v. Oregon,
344 Or 232, 257, 272-73 (2008).
As the examples described above illustrate, when this court declares the extent of a legislative policy choice or some other type of state action (but not 51 the entire choice or action) unconstitutional, it endeavors to fashion a remedy that complies with the constitution while also paying respect to the policy choice/action.
If the court finds a constitutional violation here, it should follow the same methodology here rather than remand for entry of judgment in the full amount of the jury’s verdict. If the court concludes that ORS 31.710(1) goes too far, it should not dismiss in its entirety a reasoned policy decision the legislature made to put a limit on noneconomic damages when it enacted ORS 31.710(1).
Rather, it should fashion a remedy that gives due regard to the substantive limits of Article I, section 10 while also paying respect to the legislature’s policy decision to put an upper limit on noneconomic damages.
If the legislature had known that the particular limit it chose would violate the Oregon Constitution, then it surely would have opted for a higher limit. It would no doubt have wanted the limit to be extended so that it effectuated its policy choice to the extent it is constitutionally permissible (just as the legislature would no doubt want a constitutionally permissible sentence to be imposed instead of no sentence at all if the sentence the legislature chose violated Article I, section 16).
In similar circumstances, this court has done just that. And, in doing so, the court has not judicially usurped the constitutional prerogatives of the jury or the other two branches of government. Nor, in the case of statutes, has the 52 court literally changed the terms of the statute itself. Rather, the court has merely exercised its constitutional prerogative to determine the appropriate remedy for a constitutional violation, just as it has does when creating a common-law remedy to vindicate a statutory right or enforce a statutory duty.
See Doyle v. City of Medford, 356 Or 336, 362-63, 337 P3d 797 (2014) (ruling that courts have the authority to create private rights of action to enforce statutory duties, even when the legislature does not intend to create or deny such a right).
If the prospect of performing this function in the context of a noneconomic damages award seems unimaginable, it is not because the court does not have the authority or obligation to fashion a remedy for a constitutional violation that pays respect to the legislature’s policy choice and the constitution. It is because, as explained above, there are no standards for measuring subjective, nonmonetary losses in money in the first place, and there is no way of determining what placing a monetary value on these losses does for a particular plaintiff or discerning the point at which a statutory limit on noneconomic damages would leave a particular plaintiff with a constitutionally inadequate remedy. If, however, this court decides that it can discern the point at which a statutory limit on noneconomic damages violates the remedy clause, then it should also be able to exercise its constitutional prerogative to discern 53 what the minimum constitutionally permissible noneconomic damages award would be.
Remedying a constitutional infirmity in ORS 31.710(1) (if there is one) in this fashion would not violate the no-reexamination clause of Article VII
(Amended), section 3, of the Oregon Constitution. As this court explained in
Horton, the reexamination clause prevents courts from reviewing a jury’s verdict to determine whether the verdict is “excessive or in any other respect opposed to the weight of the evidence.” 359 Or at 253. As Horton goes on to say, however, the clause does not otherwise prevent a “court” from making matter-of-law conclusions about a verdict, setting a verdict aside to the extent it is “inconsistent with the substantive law,” or even “applying the law to the facts.” 359 Or at 252-53. It follows, then, that Article VII (Amended), section
3, does not prevent the court from applying the statutory limit to the extent permitted by the constitution.
If the $500,000 limit on noneconomic damages in ORS 31.710(1) violates the remedy clause as applied in a particular case, then a reviewing court has the responsibility to impose a remedy that it deems to be constitutionally permissible and that’s the closest to the legislature’s intended limit as possible.
Accordingly, if the court holds that applying ORS 31.710(1) would leave plaintiff with a remedy that is constitutionally inadequate, the court should limit the jury’s award to the extent necessary to accommodate ORS 31.710(1) and 54
Article I, section 10, or remand with instructions for the trial court to perform this exercise in the first instance.
CONCLUSION
This court should hold that ORS 31.710(1) does not violate Article I, section 10, as applied to the verdict in this case. Accordingly, the court should reverse the decision of the Court of Appeals and affirm the judgment of the trial court. Alternatively, the court should limit the jury’s award to the extent permitted by Article I, section 10, or remand with instructions for the trial court to do so.
DATED: October 24, 2019
Respectfully submitted,
s/ Julie A. Smith Julie A. Smith, OSB No. 983450 Cosgrave Vergeer Kester LLP Attorneys for Defendant-Respondent / Petitioner on Review McInnis Waste Systems
CERTIFICATE OF COMPLIANCE PURSUANT TO ORAP 5.05(2) Brief length
I certify that this Brief complies with the 14,000 word-count limitation in ORAP 5.05(1)(b)(i)(A) and that the word count of this brief, as described in ORAP 5.05(1)(d)(i), is 13,843 words.
Type size
I further certify that the size of the type in this brief is not smaller than 14 point for both the text of the brief and footnotes as required by ORAP 5.05(3)(b).
DATED: October 24, 2019
s/ Julie A. Smith Julie A. Smith
CERTIFICATE OF FILING AND MAILING I certify that I electronically filed the Opening Brief on the Merits and Appendix with the State Court Administrator, using the Oregon Appellate eFiling system, on October 24, 2019.
I further certify that on the same date, through the use of the electronic service function of the appellate eFiling system, I served the brief and appendix on the following parties:
W. Eugene Hallman Hallman Law Office 104 SE Fifth Street PO Box 308 Pendleton, OR 97801
Attorneys for Plaintiff-Appellant/Respondent on Review
I further certify that, on the same date, I mailed a copy of the brief and appendix, by first class mail, with postage prepaid, to the following lawyers, at the following addresses:
John M. Coletti Paulson Coletti 1022 NW Marshall Street, Suite 450 Portland, OR 97209
Attorneys for Plaintiff-Appellant/Respondent on Review
s/ Julie A. Smith Julie A. Smith
4832-2426-8710 v.3