The opinion of the court was delivered by
Chief Judge Earl E. O'Connor of the United States District
Court for the District of Kansas has certified the following
question for resolution pursuant to K.S.A. 60-3201: Does K.S.A.
1987 Supp. 60-19a01 violate the Kansas Constitution, including §§
5 and 18 of the Kansas Bill of Rights?
The majority of our legislature voted to limit the traditional
role of the jury to determine the monetary value for loss of the
quality of life in Kansas by setting a limit on the recovery of
noneconomic damages. The majority of this court recognizes that
the legislature's decision to modify the common law, by setting a
limit on noneconomic damages, is a legislative decision that does
not violate our state constitution.
Prior to discussing the certified question, however, we will
review some of the findings contained in the following report:
Report of the Kansas Citizens Committee to Review Legal
Liability Problems in Kansas as They Affect Insurance and Other
Matters: Recommendations in the Area of Liability Insurance
(Oct. 17, 1986) (a report to Fletcher Bell, Kansas Commissioner
of Insurance) (hereinafter Citizens Committee Report). This
report provides important insights into the stormy controversy
which currently surrounds the liability insurance and tort
A great change in tort doctrine has taken place over the past
century. The primary function of damages is no longer seen as
deterrence or retribution for harm caused; damages are now seen
as compensation. In large part, this shift has been caused by the
modern availability of affordable liability insurance, the
purchase of which has occasionally been required by legislation.
See, e.g., K.S.A. 40-3401 et seq. (the Health Care Provider
Insurance Availability Act guarantees the availability of
insurance to all Kansas physicians).
It is the availability of liability insurance which critics
warn is threatened by the present tort system. If insurance goes,
so will compensation to many plaintiffs, no matter how favorable
the laws are in their favor. In reality, "[j]ustice is not
achieved when deserved compensation is granted by a court; it is
achieved when that compensation is paid to the plaintiff."
Citizens Committee Report 52 (quoting Report of the Governor's
Advisory Commission on Liability Insurance for the State of New
York 121-29 [Apr. 1986]).
Insurance companies derive profits from two sources:
underwriting revenues and investment income. Investment income
fluctuations play an enormous part in premium cycles. "However,
never before did interest rates have such a profound influence
upon premiums as during the latest cycle when double digit
interest rates provided insurance companies with a substantial
pool of funds available to use to increase market share by
reducing premiums." Citizens Committee Report 33-34.
The insurance crisis of the 1970s, referred to in the Citizens
Committee Report, was partially caused by the industry's
increased market at lower premiums due to its remarkably high
rate of return on investments. The crisis was especially
hard-felt in the malpractice insurance area. In response to this
crisis and to ensure the continued availability of medical
liability insurance, every state enacted some type of tort
reform; the statutes number over 300. Comment, Caps, "Crisis",
and Constitutionality Evaluating the 1986 Kansas Medical
Malpractice Legislation, 35 Kan. L. Rev. 763, 765 n. 18 (1987).
The Kansas Legislature and Governor took the following actions:
In 1976, the Health Care Provider Insurance Availability Act,
which created the Health Care Stabilization Fund, was enacted
(K.S.A. 40-3401 et seq.); medical malpractice screening panels
were established (K.S.A. 65-4901 et seq.); the statute of
limitations was shortened as to medical malpractice actions
(K.S.A. 60-513); and the collateral source rule was modified as
to medical malpractice actions (K.S.A. 60-471). We upheld the
modification to the statute of limitations in Stephens v. Snyder
Clinic Ass'n, 230 Kan. 115, 631 P.2d 222 (1981). In Wentling v.
Medical Anesthesia Services, 237 Kan. 503, 518, 701 P.2d 939
(1985), we invalidated the modification to the collateral source
rule as a violation of the equal protection guarantee of our
state constitution. In its 1985 session, the legislature took
note of Wentling and repealed K.S.A. 60-471 by enacting L.
1985, ch. 197, § 5.
Some insurance industry observers correctly predicted that a
new crisis would develop in the early 1980s as interest rates
fell and insurance companies' investment returns decreased. See
Comment, 35 Kan. L. Rev. at 770. The crisis of the 1980s is the
burgeoning price of medical malpractice insurance.
Because the legislation of the 1970s had failed to halt the
increasing cost of medical malpractice insurance and in response
to the new crisis of the 1980s, the Kansas Legislature took the
following actions in 1985: (1) a cap was placed on punitive
damages in medical malpractice actions, and (2) another attempt
was made at modifying the collateral source rule in medical
actions (K.S.A. 1985 Supp. 60-3403). In Farley v. Engelken,
241 Kan. 663, 740 P.2d 1058 (1987), we found this modification of the
collateral source rule to be a violation of equal protection.
When its prior efforts failed to check the rising cost of
medical malpractice insurance premiums as promised, the 1986
legislature went further, taking the following actions: medical
malpractice screening panel decisions were made admissible at
trial (K.S.A. 1986 Supp. 65-4904[c]); the Health Care
Stabilization Fund's liability was restricted (K.S.A. 40-3403);
the award of attorney fees was made contingent on approval after
an evidentiary hearing (K.S.A. 1986 Supp. 7-121b[a]); the
Internal Risk Management Program was created (K.S.A. 1986 Supp.
65-4922); and limitations were placed on the qualifications of
expert witnesses in medical malpractice actions (K.S.A. 1986
Supp. 60-3412). Finally, the legislature attempted to limit the
liability of health care providers in medical malpractice actions
by capping recovery for noneconomic losses at $250,000 and by
placing a total cap on all losses, both economic and noneconomic,
at $1,000,000 (K.S.A. 1986 Supp. 60-3407). We invalidated this
last measure as a violation of §§ 5 and 18 of the Kansas Bill of
Rights in Kansas Malpractice Victims Coalition v. Bell,
243 Kan. 333, 757 P.2d 251 (1988) (Malpractice Victims).
The great majority of states have also enacted statutes to deal
with the new crisis. See Comment, 35 Kan. L. Rev. at 771 n. 53.
And, many of these statutes provide for caps on noneconomic
losses. See Brantingham, Civil Justice Reform: The Continuing
Search for Balance, 10 Hamline L. Rev. 387, 399-402 (1987); see
Annot., 80 A.L.R.3d 583; Lewis, The Case Against Caps, 75 Ill.
B.J. 164 (1986). Many of these statutes are so recent they have
not yet been challenged on appeal. As for those which have been
challenged, the outcomes vary according to the arguments raised
and the state constitutional provisions upon which those
arguments were based.
In Fein v. Permanente Medical Group, 38 Cal.3d 137,
211 Cal.Rptr. 368, 695 P.2d 665 (1985), the California Supreme Court
upheld the constitutionality of a statute which limited
noneconomic damage awards in medical malpractice suits to
$250,000. The provisions of the California Constitution
applicable in Fein are similar to the constitutional provisions
involved in this case.
Applying a rational basis standard of review, the court rejected
the plaintiff's equal protection and due process claims. The
court also rejected Fein's argument that the legislature had
limited the potential recovery of medical malpractice victims
without providing an adequate quid pro quo, holding that (1) a
plaintiff has no vested property right in a particular measure of
damages, and (2) the legislature has broad authority in modifying
the scope and nature of damages. 38 Cal.3d at 157.
In reviewing similar cases from other jurisdictions, the Fein
majority noted that the statutes challenged in those cases, with
one exception, involved caps which limited both economic and
noneconomic damages. 38 Cal.3d at 161. The Fein dissent cited
many of the same cases, emphasizing that a majority of those
courts> had invalidated the challenged caps regardless of the type
of limitation imposed by the legislature. 38 Cal.3d at 170.
The United States Supreme Court dismissed the subsequent appeal
of Fein for want of a substantial federal question. 474 U.S. 892,
88 L.Ed.2d 215, 106 S.Ct. 214 (1985). Justice White
dissented as to the dismissal, noting that a majority of state
courts> had so far invalidated such damage caps, including those
caps which were limited to noneconomic damages. 474 U.S. at 893.
Justice White would have granted the appeal to consider the
following question left unanswered by Duke Power Co. v. Carolina
Environmental Study Group, Inc., 438 U.S. 59, 57 L.Ed.2d 595, 98
S.Ct. 2620 (1978): whether federal due process requires a quid
pro quo when a state replaces a common-law remedy with a
legislatively enacted compensation scheme.
The Supreme Court's treatment of the Fein appeal was
acknowledged in Ferguson v. Garmon, 643 F. Supp. 335, 340 (D.
Kan. 1986). Chief Judge O'Connor noted that the dismissal of
Fein in most safely construed, in the absence of doctrinal
developments indicating otherwise, as a ruling on the merits that
a statute capping recovery of noneconomic loss presents no
substantial issue under the federal constitution. See Hicks v.
Miranda, 422 U.S. 332, 344, 45 L.Ed.2d 223, 95 S.Ct. 2281
In Duren v. Suburban Community Hosp., 24 Ohio Misc.2d 25,
495 N.E.2d 51 (1985), the Court of Common Pleas of Ohio, a trial
court of general jurisdiction, let stand a $1,000,000 award
for pain and suffering by invalidating an Ohio statute which set
a general cap of $200,000 on medical malpractice awards. Central
to the court's decision was the legislature's failure to
distinguish between general damages, those which "necessarily
result from the injury complained of," and noneconomic damages.
24 Ohio Misc.2d at 28. Because the parties settled, no appeal was
taken from this decision. (In Malpractice Victims,
243 Kan. 333, we found unconstitutional a similar set of statutes that
capped the total recovery of all damages, both economic and
noneconomic, at $1,000,000.)
In Smith v. Department of Ins., 507 So.2d 1080, 1088-89 (Fla.
1987), the Supreme Court of Florida held a $450,000 cap on
noneconomic damages violative of the right to a jury trial as
guaranteed by the Florida Constitution. The court stated that a
cap on such damages would be constitutional only if the
legislature provided a quid pro quo or found that there was no
other alternative in meeting an overpowering public necessity.
In Lucas v. U.S., 757 S.W.2d 687 (Tex. 1988), the Texas
Supreme Court held that a $150,000 cap on damages in medical
malpractice actions violated a state constitutional provision
which guarantees "remedy by due course of law." 757 S.W.2d at
690. The only damages exempted from the cap were those to
compensate for past and future expenses of necessary medical,
hospital, and custodial care. The court found that when the
legislature set the cap, it had failed to provide an adequate
substitute to obtain redress for injuries (a quid pro quo), as
was done in the state's Workers Compensation Act. Following the
rationale applied by the Florida court in Smith, the Texas
court held that citizens of that state are entitled to have
damages in civil actions assessed by a jury. 757 S.W.2d at 692.
(Our rationale in Malpractice Victims is similar to the
rationale of the Florida Supreme court in Smith and the Texas
Supreme Court in Lucas.)
In Boyd v. Bulala, 647 F. Supp. 781 (W.D. Va. 1986)
reconsideration denied, 672 F. Supp. 915 (W.D. Va. 1987),
rev'd 877 F.2d 1191 (4th Cir. 1989), a case brought under
diversity jurisdiction, the federal district court held that a
Virginia statute which limits total damages in medical
malpractice actions to $1 million violates the right to a jury
trial as guaranteed by the 7th Amendment to the United States
Constitution and by the Virginia Constitution.
The federal court stated that the assessment of damages was
clearly a jury function under the common law and that the 7th
Amendment was intended as a check on both the judiciary and the
legislature. As for the Virginia Constitution, the federal
district court found the state guarantee of a jury trial to be at
least as strong as that provided in the federal constitution.
Without mentioning the federal district court's decision in
Boyd, the Supreme Court of Virginia held that the statutory cap
at issue in that earlier case did not violate the state
constitution's guarantee of a jury trial. Etheridge v. Medical
Center Hospitals, 237 Va. 87, 376 S.E.2d 525 (1989) (three
justices dissenting). While the Virginia court agreed that a
plaintiff is entitled to a jury determination of actual damages
under the state constitution, it held that the legislature may
limit actual recovery since full recovery was never guaranteed
at common law. 237 Va. at 96. (Using a different rationale when
reviewing workers compensation, we reached a similar result in
Rajala v. Doresky, 233 Kan. 440, 661 P.2d 1251 ).
In Boyd v. Bulala, 877 F.2d 1191 (4th Cir. 1989), the Court
of Appeals reversed the district court's earlier judgment and
upheld the constitutionality of Virginia's cap on medical
malpractice damages. The court found the Virginia Supreme Court's
holding in Etheridge dispositive of challenges made under the
state constitution. 877 F.2d at 1195. As for the federal
constitution, the court found no 7th Amendment violation: "If a
legislature may completely abolish a causes of action without
violating the right of trial by jury, we think it permissibly may
limit damages recoverable for a cause of action as well." 877
F.2d at 1196. The court also found no violation of due process or
equal protection since the cap was reasonably related to the
legitimate goal of ensuring adequate health care services. 877
F.2d at 1196-97.
In Franklin v. Mazda Motor Corp., 705 F. Supp. 1325 (D. Md.
1989), the United States District Court for the District of
Maryland held a $350,000 cap on noneconomic damages in personal
injury awards did not violate the federal or state constitutions.
First, the Maryland court noted an individual has no vested
interest in any rule of common law; therefore, the cap did not
violate the right to a jury trial under the Maryland
Constitution. Article 23 of the Maryland Declaration of Rights
"The right of trial by Jury of all issues of fact in civil
proceedings in the several Courts> of Law in this State, where the
amount in controversy exceeds the sum of five hundred dollars,
shall be inviolably preserved." The court distinguished the role
of a jury as a part "of the dispute resolution apparatus between
parties" and the role of the legislature in making "rules in
advance of disputes." 705 F. Supp. at 1331. The court noted that
the legislature has the power to "terminate an entire valid and
provable claim through a statute of limitations," and found that
a remedy, as opposed to a finding of liability, is a matter of
law rather than of fact. 705 F. Supp. at 1333.
The cap on noneconomic damages also withstood Franklin's second
challenge based on Article 19 of the Maryland Declaration of
Rights, which provides: "[E]very man, for any injury done to him
in his person or property, ought to have remedy by the course of
the Law of the land, and ought to have justice and right, freely
without sale, fully without any denial, and speedily without
delay, according to the Law of the land." The court had
previously determined that Article 19 gave the same due process
rights as the 14th Amendment of the United States Constitution.
Access to the courts> of Maryland is determined under a test of
reasonableness, with no requirement of heightened scrutiny. The
court held the cap bore a reasonable relation to a valid
legislative purpose, but acknowledged that some states, such as
Kansas, find "more protection in their state due process
clauses." 705 F. Supp. at 1337 (citing Malpractice Victims,
243 Kan. 333). The court also acknowledged that "some state
constitutions treat full recovery in tort as a fundamental
right." 705 F. Supp. at 1337 (citing Barrio v. San Manuel,
143 Ariz. 101, 692 P.2d 280 ).
In Sofie v. Fibreboard Corp., 112 Wn.2d 636, 771 P.2d 711
(1989), the Washington Supreme Court held a statutory limitation
on noneconomic damages unconstitutional. The damage limitation
operated on a formula based upon the age of the injured
plaintiff. The court, without addressing the equal protection
claim, found that the statute's limitation on noneconomic damages
in medical malpractice actions interferes with the jury's
traditional function of determining damages.
In Meech v. Hillhaven West, Inc., 776 P.2d 488 (Mont. 1989),
a group of employees brought action in ...