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Mississippi tort reform questions remain

Published 12:16am Sunday, March 24, 2013

JACKSON (AP) — The Fifth Circuit Court of Appeals’ decision that Mississippi’s $1 million cap on noneconomic damages arising from civil litigation does not violate the state constitution’s separation of powers clause does not necessarily mean state courts have to abide by the ruling.

The cap was considered the centerpiece of tort reform, with supporters saying it would guarantee businesses’ liability insurance premiums would remain reasonably priced and would also ensure predictability in jury awards.

Specifically, the Mississippi Supreme Court, if and when the cap is before it again, could rule differently than the Fifth Circuit.

“The Mississippi Supreme Court is not by anyway bound by the Fifth Circuit’s opinion,” said Matt Steffey, professor at Mississippi College School of Law in Jackson. “They may or may not find it persuasive.”

Steffey said the part of the Fifth Circuit’s opinion that referred to the disposition as an “eerie guess” means the court is supposing what state law will be.

“It’s certainly not settling the matter,” he said.

The issue will likely reach the Mississippi Supreme Court in a way that it will be obligated to answer it, Steffey said, referring to the state court’s decision to pass on the issue last summer.

“By that I mean it will be presented in such a way that it will be straight-forward constitutionally.

“Even if the Mississippi Supreme Court is persuaded by the Fifth Circuit’s reasoning on the central issue of this appeal, and that is the inviolate right to the jury guarantee, that’s the central holding of the Fifth Circuit’s opinion, and maybe the Mississippi Supreme Court finds that persuasive and adopts it,” he said.

A more likely scenario, Steffey said, is the state court taking a fresh look at the separation of powers argument, which was the central issue addressed by the Fifth Circuit, and deciding for themselves if the cap is in line with the state constitution.

“The Mississippi Supreme Court is often particularly attentive to issues that deal with its role in its branch of government,” Steffey said.

The court could consider issues the Fifth Circuit did not, he said.

“The Fifth Circuit did not address at all arguments based on due process or the Remedy Clause, and I suspect the Mississippi Supreme Court will engage those.”

The state court could rule in a number of ways, Steffey said.

Justices could strike down the cap all together, they could rule that the Legislature could set any cap it deems fit, or it could decide that lawmakers could set a cap the court deems reasonable. At that point, the issue would be back before the Legislature to formulate a new cap.

“But that option is the one that sounds the least like a rule of law,” Steffey said.

The case for those arguing for the cap before the state court will be bolstered by the Fifth Circuit’s ruling, Steffey said, calling it a “good arrow to have in the quiver.”

But it still provides no guarantees.

“Again, this isn’t binding, although it might be persuasive, because there are certainly unsettled issues. It is slightly more settled than it was before, but it is far from settled completely.”

The $1 million cap on noneconomic damages applies to what a jury can award someone for such things as pain and suffering. The limits on damages were adopted by Mississippi lawmakers after years of contentious wrangling over tort changes.

Noneconomic damages under Mississippi law do not include punitive damages.

There is no cap on damages for economic losses, such as how much the person could have expected to earn in his or her lifetime or for such things as continuing medical expenses.

The initial limits on lawsuit awards came in 2002. The law was amended in 2004 amid complaints that the initial changes didn’t go far enough.

The Fifth Circuit’s ruling came in February in response to the Mississippi Supreme Court’s decision not to rule on the matter last summer. The state court said then that to do so would be to engage in speculation.

The argument originated in federal court in Aberdeen. Plaintiff Lisa Learmonth sued Sears and Roebuck Co. in 2006 after she was involved in a collision with one of the company’s vans near Philadelphia, Miss.

A federal jury in Mississippi in 2008 found Sears was liable for Learmonth’s injuries and awarded $4 million in damages but jurors did not itemize how much of the award was for noneconomic damages.

Learmonth and Sears agreed $2.2 million of the verdict was for noneconomic damages. A federal judge reduced that part of the damages to $1 million, in line with Mississippi law.

Learmonth’s attorneys, as part of a cross appeal, asked the Fifth Circuit to render the cap unconstitutional, arguing that that the law passed by the Legislature improperly infringed on a jury’s right to decide how much should be awarded to whom.

The appeals court rejected that argument, but in doing so, might have left the cap vulnerable to another kind of constitutional challenge.

Toward the end of the 25-page opinion, Judge Carolyn Dineen King writes that Learmonth’s attorneys “overlooked the possibility that, at least under some circumstances, the Mississippi Constitution’s Due Process Clause or Remedy Clause might impose substantive constraints on the Legislature’s authority to cap compensatory damages.”

Due process prevents the taking of life, liberty or property without due process of law. The Remedy Clause contains two guarantees: that courts be open and that those injured have a remedy by due course of the law.

For a party to argue an issue on appeal, it has to be “preserved” in a lower court, meaning it must part of the arguments presented there. Neither due process nor the remedy clause was part of the issues Learmonth’s attorneys raised to the Fifth Circuit.

Steffey said arguments based on due process are typically a “last line of defense.”

“When you do not have a more specific constitutional provision to rely on, you rely on the vague and majestic language of due process.”

The Learmonth case could be an exception, Steffey said, because the plaintiff was deprived of a jury award because of the cap

“The interesting part of the due process argument is what if the Legislature reduced the noneconomic damages to a dollar and left people without a substantial remedy? Then due process and remedy clause arguments become very attractive,” he said.

Steffey said it’s likely the due process arguments will eventually be made in front of the Mississippi Supreme Court.