Title: Del Rio v. Crake

State: hawaii

Issuer: Hawaii Supreme Court

Document:

955 P.2d 90 (1998) 87 Hawai`i 297 Montana G. DEL RIO, a minor, by her Guardian Ad Litem, Humberto DEL RIO, Plaintiff-Appellant, v. Sandra CRAKE, Defendant-Appellee, and John Does 1-5, Doe Corporations 1-5, Doe Partnerships 1-5, Roe Non-Profit Corporations 1-5, and Roe Governmental Agencies 1-5, Defendants. No. 21094. Supreme Court of Hawai`i. May 8, 1998. *91 Timothy P. McNulty, on the briefs, Kihei, for plaintiff-appellant. Melvyn M. Miyagi and James V. Myhre, of Reid, Richard & Miyagi, on the briefs, Honolulu, for defendant-appellee. Deborah Day Emerson and David A. Webber, Deputy Attorneys General, on the briefs, as amicus curiae. Before MOON, C.J., and KLEIN, LEVINSON, NAKAYAMA and RAMIL, JJ. MOON, Chief Justice. On July 17, 1997, the circuit court of the second circuit entered a written order granting defendant-appellee Sandra Crake's motion for summary judgment against plaintiff-appellant Montana G. Del Rio, a minor, by her guardian ad litem, Humberto Del Rio. Del Rio appeals, contending that the circuit court erred in ruling that, because Del Rio did not meet any of the tort threshold exceptions[1] enumerated in Hawaii Revised Statutes (HRS) § 431:10C-306(b) (1993)[2], she *92 was precluded from bringing suit in tort against the allegedly negligent Crake, notwithstanding that Del Rio was uninsured and, therefore, ineligible for no-fault benefits. Specifically, Del Rio contends that the tort threshold statute, HRS § 431:10C-306, is unconstitutional per Joshua v. MTL, Inc., 65 Haw. 623, 656 P.2d 736 (1982), and McAulton v. Goldstrin, 66 Haw. 14, 656 P.2d 96 (1982), and requests that this court so declare and remand this matter for trial. For the reasons set forth below, we (1) overrule Joshua and McAulton, and (2) affirm the circuit court's order granting summary judgment in favor of Crake. This case arises from an August 20, 1995 motor vehicle accident that occurred at the intersection of Ka`anapali Parkway and Noheakai Drive in Ka`anapali, Maui. Del Rio, a minor, was driving an uninsured motor vehicle registered to her father. Crake, a tourist, ran the stop sign at the intersection and impacted the vehicle Del Rio was operating. Del Rio sustained personal injuries, but, because the vehicle she was operating was uninsured, she was unable to obtain no-fault benefits to pay for the health care expenses related to her injuries. On September 11, 1996, Del Rio filed suit against Crake, seeking to recover damages in tort. Crake then moved for summary judgment, and, on July 9, 1997, the circuit court heard argument on the motion. At the hearing, Del Rio relied upon Joshua and McAulton as supporting her right to bring suit in tort. The court in Joshua held that the tort threshold statute then in effect[3]*93 worked an unconstitutional denial of equal protection as applied to persons ineligible for no-fault benefits because the ineligible tended to be poor. In Joshua, the plaintiff (Joshua) was injured when an MTL bus struck his vehicle. Unbeknownst to Joshua, his insurance had been canceled and notice thereof sent to his parents' home. Consequently, at the time of the accident, he was an uninsured driver and, thus, unable to recover no-fault benefits, even though the other vehicle was insured. He thereafter sued in tort; however, because he was ineligible to receive no-fault benefits, the trial court ruled that he was required to bring his action within two years of the accident under HRS § 294-36(b)(1) (1976), even though, under HRS § 294-36(b)(2) (1976), persons receiving no-fault benefits have until two years after the last payment of such benefits to commence suit. On appeal, a majority of the Joshua court first noted that, prior to abolition of tort liability, a person suffering personal injuries due to the negligence of another in an automobile accident could bring suit against the negligent party. However, following enactment of HRS § 294-6, a person who could not claim no-fault benefits was also precluded from bringing suit if he or she could not meet any of the tort threshold exceptions. The Joshua majority then applied the rational basis test to HRS § 294-6 to determine whether it denied those ineligible for no-fault benefits the equal protection of the laws. The Joshua majority found it to be so because Joshua, 65 Haw. at 630, 656 P.2d at 741 (footnotes omitted). The day following issuance of the Joshua decision, this court issued its three-to-two decision in McAulton. Therein, the plaintiff (McAulton) was an uninsured motorist and again was unable to claim no-fault benefits. McAulton then sued the allegedly negligent party, but the trial court held that suit was precluded because McAulton failed to meet any of the tort threshold requirements under HRS Chapter 294. On appeal, the McAulton majority reversed, stating that the tort threshold requirements were unconstitutional as applied to all persons ineligible for no-fault benefits, notwithstanding that McAulton clearly could have afforded to purchase insurance.[4]McAulton, 66 Haw. at 15, 656 P.2d at 97. At the hearing on her motion for summary judgment, Crake argued that Joshua and McAulton were no longer applicable and, thus, did not govern this case. Crake asserted that this was so because, in 1983, the Legislature responded to Joshua and McAulton by "restating and clarifying its intent ... to make clear that the abolition of tort liability and the exceptions thereto apply to all persons regardless of whether they are entitled to receive no-fault benefits." Specifically, the Legislature, via House Bill 915 (1983) (Act 245), expressed its view in the following standing committee report: Sen. Stand. Comm. Rep. No. 830, in 1983 Senate Journal, at 1417. Also, in section 1 of Act 245, the Legislature further discussed its intention and purpose in enacting the no-fault motor vehicle insurance system. 1983 Haw. Sess. L. Act 245, § 1 at 510-21. Del Rio argued that the Legislature's reassertion of its intention did not serve to vitiate the holdings of Joshua and McAulton, and, thus, that the cases were still valid and the circuit court was bound by their stare decisis effect. On July 9, 1997, the circuit court orally granted Crake's motion, ruling that Del Rio's suit was precluded for failure to meet any of the tort threshold exceptions, even though Del Rio was ineligible for no-fault benefits. The circuit court acknowledged that "the Supreme Court [had] ma[d]e a decision under the old law. Then the legislature came back and said no[;] this is what we really mean." Thus, the circuit court believed that the question before it was whether it had to "abide by what the legislature clearly says or interpret the prior Supreme Court decision as alsomeaning that the new legislation is... unconstitutional[.]" The circuit court ultimately ruled that subsequent legislative intent superseded the previous judicial declarations in Joshua and McAulton, stating: "[A]fter considering this matter, I am satisfied that the court shouldthat the court should not override the clear intent of the legislature[,] and I am going to grant the motion." On July 17, 1997, without findings of fact or conclusions of law, the circuit court entered its written order granting Crake's motion for summary judgment. Del Rio's timely appeal followed. A motion for summary judgment is reviewed de novo, under the same standard applied by the circuit court. Konno v. County of Hawai`i, 85 Hawai`i 61, 70, 937 P.2d 397, 406 (1997) (citation omitted). Id. (internal quotation marks and citations omitted). Del Rio argues that a subsequent legislature's re-enactment of an unconstitutional statute does not purge it of its unconstitutionality, notwithstanding clarification of the legislature's intent. Crake responds that the statute is not unconstitutional because this court, in Joshua and McAulton, "misinterpreted the Legislature's intent inasmuch as it meant then and now to preclude recovery in *97 tort regardless of whether one did or did not have motor vehicle insurance." Del Rio is correcta legislature's subsequent assertion that it in fact intended to enact an unconstitutional statute does not thereby cause that statute to pass constitutional muster. Rather, the question as to the constitutionality of a statute is not for legislative determination, but is vested in the judiciary, and a statute cannot survive constitutional challenge based on legislative declaration alone. Stephenson v. Binford, 53 F.2d 509, 514 (S.D.Tex.1931), aff'd, 287 U.S. 251, 53 S. Ct. 181, 77 L. Ed. 288 (1932). The legislature cannot force the judiciary to construe a statute in accordance with legislative interpretation. California Employment Stabilization Comm'n v. Chichester Transp. Co., 75 Cal. App. 2d 899, 172 P.2d 100, 102 (1946). Nor can the legislature "effect a change in [the] construction [of a statute] by a later declaration of what it had originally intended." Bates v. Board of Educ., 136 Ill. 2d 260, 144 Ill.Dec. 104, 107, 555 N.E.2d 1, 4 (1990). "An erroneous opinion of an existing law by the legislature does not alter it." Anderson v. Hadley, 245 Iowa 550, 63 N.W.2d 234, 239 (1954). Recently, the United States Supreme Court reaffirmed the fundamental, one hundred ninety-five-year-old tenet of federal constitutional jurisprudence that the judicial branch is the final arbiter of the United States Constitution: City of Boerne v. Flores, ___ U.S. ___, ___, 117 S. Ct. 2157, 2172, 138 L. Ed. 2d 624 (1997). Similarly, this court is the "final arbiter of the meaning of the provisions of the Hawai`i Constitution." State v. Hoey, 77 Hawai`i 17, 33 n. 16, 881 P.2d 504, 520 n. 16 (1994) (citation, internal quotation marks, and internal brackets omitted); State v. Santiago, 53 Haw. 254, 265, 492 P.2d 657, 664 (1971). If a statute is determined by the court to contravene the equal protection of the laws, such a determination can be changed only by constitutional amendment or via the court's power to overrule its prior decisions. Therefore, because HRS § 431:10C-306 (1993), with respect to the issues on appeal, is substantively identical to its predecessors (HRS § 294-6 (1976) and HRS § 294-6 (1984 Supp.)), we hold that Joshua and McAulton have stare decisis effect and thus, as of this moment, retain their precedential character. However, for the reasons set forth below, we overrule Joshua and McAulton as having misapplied the rational basis test. We further hold that HRS § 431:10C-306 (1993) does not violate the constitutional right to the equal protection of the laws as applied to persons ineligible for no-fault benefits. In analyzing alleged equal protection violations, classifications that are neither "suspect" nor "quasi-suspect" are subject to the rational basis test. Cf. Baehr v. Lewin, 74 Haw. 530, 852 P.2d 44, reconsideration denied, 74 Haw. 645, 852 P.2d 74 (1993); see also Nachtwey v. Doi, 59 Haw. 430, 437, 583 P.2d 955, 960 (1978) (classifications based *98 upon poverty, or impacting the poor as a class, are subject to the rational basis test). Similarly, because the class of persons, indigent or otherwise, who are ineligible for no-fault benefits is neither "suspect" nor "quasi-suspect," we must apply the rational basis test to the case at hand. Washington v. Fireman's Fund Ins. Companies, 68 Haw. 192, 199, 708 P.2d 129, 134 (1985) (citations, internal quotation marks, and brackets omitted), cert. denied, 476 U.S. 1169, 106 S. Ct. 2890, 90 L. Ed. 2d 977 (1986). Thus, under the rational basis test, "the court essentially asks whether a statute rationally furthers a legitimate state interest." Housing Fin. & Dev. Corp. v. Castle, 79 Hawai`i 64, 86, 898 P.2d 576, 598 (1995); see also State v. Miller, 84 Hawai`i 269, 276, 933 P.2d 606, 613 (holding that "the challenged classification must bear some rational relationship to legitimate state purposes"), reconsideration denied, 84 Hawai`i 496, 936 P.2d 191 (1997). In making this inquiry, Castle, 79 Hawai`i at 86, 898 P.2d at 598 (emphasis added) (citations and quotation marks omitted). Hence, in determining whether a statute passes constitutional muster under the rational basis test, we apply a two-step test. First, we must ascertain whether the statute was passed for a legitimate governmental purpose. Id. Second, if the purpose is legitimate, the court must determine whether the legislature rationally could have believed that the statute would promote its objective. Id. In examining the first prong of the test, the legislature has stated that the purpose of Article 10C is to create "a system of reparations for accidental harm and loss arising from motor vehicle accidents[] ... [and to c]ompensate these damages without regard to fault; and [to l]imit tort liability[.]" HRS § 431:10C-102 (1993). Because the State has an interest in protecting the health, safety, and welfare of its citizens, such a purpose is "legitimate." See, e.g., Warren v. Melville, 937 P.2d 556, 561 (Utah Ct.App. 1997) (recognizing that the legislature had a legitimate purpose in using its police power to require those who use motor vehicles on the roads of Utah to be subject to Utah's no-fault statute). The second prong of the inquiry is whether the statute rationally furthers the legitimate state interest. In an effort to fulfil this purpose, the legislature enacted a comprehensive system of laws whereby those who do not participate will be treated more harshly than those who do. In so doing, the legislature based its decision upon the fundamental premise that driving a motor vehicle is a privilege and not a right and that, therefore, if one exercises the privilege of driving *99 without the concomitant responsibility of operating an insured automobile, he or she will be treated more harshly. HRS § 431:10C-102(b) (emphases added). Del Rio asserts, however, that those who are truly indigent are treated differently. As previously noted, however, "the State cannot function without classifying its citizens for various purposes and treating some differently from others." Washington, 68 Haw. at 199, 708 P.2d at 134. In the absence of "suspect" or "quasi-suspect" classifications, the legislation will be upheld as long as the legislature "rationally could have believed that the statute would promote its objective." Castle, 79 Hawai`i at 86, 898 P.2d at 598. Disincentive to those who opt out of the system is a rational method by which to further one of the legitimate purposes, that is, to encourage participation. Moreover, the legislature has in fact made allowances by way of public assistance for those who cannot afford insurance. "Those persons truly economically unable to afford insurance are provided for under the public assistance provisions of [Article 10C]." HRS § 431:10C-102(b)(2). Also, although not specifically on point, the District of Columbia Court of Appeals held in Makanju v. Saunders, 519 A.2d 703 (D.C. 1987), that the tort threshold bar was constitutional. Therein, a taxicab driver (Makanju) was involved in an accident with one Saunders. Makanju failed to meet the medical rehabilitative limit but nevertheless brought suit in tort. The trial court held that his suit was barred, and Mankanju appealed, contending that the medical rehabilitative limits denied him the equal protection of the laws. On appeal, the court held that preventing suit except in those instances where injuries are serious "bears a rational relation to the legislative purposes of assuring adequate protection for accident victims and keeping insurance premiums affordable." Id. at 704 (citation omitted); see also Dinesen v. Towle, 3 Kan.App.2d 505, 597 P.2d 264, 268 (1979) (holding that "the threshold concept in general and the ... medical expense standard in particular" are constitutional). Similarly, in the instant case, it is important to note that, had Del Rio been seriously injured, she would have been able to seek recovery in tort. Moreover, if in fact she and her family were indigent and were unable to afford automobile insurance, they could have applied for public assistance benefits. Under Hawaii's comprehensive scheme, there is no legitimate excuse for driving without insurance coverage. Thus, those who do not participate cannot enjoy the benefits afforded to those who do. Additionally, under Joshua and McAulton, persons who opt out of the system receive a benefit that those who abide by the law are not entitled to. In his dissenting opinion in Joshua, Justice Nakamura articulated this disparity as follows: Joshua, 65 Haw. at 634, 656 P.2d at 743. Accordingly, we hold that HRS § 431:10C-306 does not deny equal protection of the laws to those ineligible for no-fault benefits because: (1) driving is a privilege, not a right; (2) disincentives designed to encourage participation are rationally related to the legitimate purposes of creating "a system of reparations for accidental harm and loss arising from motor vehicle accidents[] ... [and to c]ompensate these damages without regard *100 to fault; and [to l]imit tort liability[,]" HRS § 431:10C-102; and (3) persons who are truly indigent can seek coverage through public assistance provisions. Because HRS § 431:10C-306 is constitutional as applied to those ineligible for no-fault benefits, we: (1) overrule Joshua v. MTL, Inc., 65 Haw. 623, 656 P.2d 736 (1982), and McAulton v. Goldstrin, 66 Haw. 14, 656 P.2d 96 (1982); and (2) affirm the circuit court's order granting summary judgment in favor of Crake. [1] The parties agree that Del Rio does not qualify under any of the tort threshold exceptions. [2] HRS § 431:10C-306 provides in relevant part: Abolition of tort liability. (a) Except as provided in subsection (b), this article abolishes tort liability of the following persons with respect to accidental harm arising from motor vehicle accidents occurring in this State: (1) Owner, operator or user of an insured motor vehicle; or (2) Operator or user of an uninsured motor vehicle who operates or uses such vehicle without reason to believe it to be an uninsured motor vehicle. (b) Tort liability is not abolished as to the following persons, their personal representatives, or their legal guardians in the following circumstances: (1) (A) Death occurs to such person in such a motor vehicle accident; (B) Injury occurs to such person which consists, in whole or in part, in a significant permanent loss of use of a part or function of the body; or (C) Injury occurs to such person which consists of a permanent and serious disfigurement which results in subjection of the injured person to mental or emotional suffering; (2) Injury occurs to such person in a motor vehicle accident in which the amount paid or accrued exceeds the medical-rehabilitative limit established in section 431:10C-308 for expenses provided in section 431:10C-103(10)(A) and (B); provided that the expenses paid shall be presumed to be reasonable and necessary in establishing the medical-rehabilitative limit; or (3) Injury occurs to such person in such an accident and as a result of such injury that the aggregate limit of no-fault benefits outlined in section 431:10C-103(10) payable to such person are exhausted. (c) Subsections (a) and (b) shall apply whether or not the injured person is entitled to receive no-fault benefits. The party against whom the presumption under this section is directed shall have the burden of proof to rebut the presumption. (d) No claim may be made for benefits under the uninsured motorist coverage by an injured person against an insurer who has paid or is liable to pay no-fault benefits to such injured person unless such claim meets the requirements of subsection (b). (Bold emphasis in original.) (Underscored emphasis added.) [3] Joshua interpreted HRS Chapter 294 (1976), which was initially enacted in 1973 and subsequently revised by Act 295, Hawaii Session Laws 1983. Act 295, codified again as HRS § 294-6 (1984 Supp.), was in turn subsequently revised and recodified in HRS § 431:10C-306. See supra note 2. The relevant sections of the 1973 and 1983 provisions, as codified in the 1976 volume and in the 1984 Supplement of HRS, respectively, are as follows: § 294-6 [1976] Abolition of tort liability. (a) Tort liability of the owner, operator or user of an insured motor vehicle, or the operator of user of an uninsured motor vehicle who operates or uses such vehicle without reason to believe it to be an uninsured motor vehicle, with respect to accidental harm arising from motor vehicle accidents occurring in this State, is abolished, except as to the following persons or their personal representatives, or legal guardians, and in the following circumstances: (1) Death occurs to such person in such a motor vehicle accident; or injury occurs to such person which consists, in whole or in part, in a significant permanent loss of use of a part or function of the body; or injury occurs to such person which consists of a permanent and serious disfigurement which results in subjection of the injured person to mental or emotional suffering; (2) Injury occurs to such person in a motor vehicle accident in which the amount paid or accrued exceeds the medical-rehabilitative limit establishes in section 294-10(b) for expenses provided expenses provided in section 294-2(10)(A) [medical expenses] and (B) [therapy]; (3) Injury occurs to such person in such an accident and as a result of such injury the aggregate limit of no-fault benefits outlined in section 294-2(10) payable to such person are exhausted. HRS § 294-6 (1976) (bold emphasis in original). § 294-6 [1984 Supp.] Abolition of tort liability. (a) Tort liability of the owner, operator or user of an insured motor vehicle, or the operator or user of an uninsured motor vehicle who operates or uses such vehicle without reason to believe it to be an uninsured motor vehicle, with respect to accidental harm arising from motor vehicle accidents occurring in this State, is abolished, except as to the following persons or their personal representatives, or legal guardians, and in the following circumstances: (1) Death occurs to such person in such a motor vehicle accident; or injury occurs to such person which consists, in whole or in part, in a significant permanent loss of use of a part or function of the body; or injury occurs to such person which consists of a permanent and serious disfigurement which results in subjection of the injured person to mental or emotional suffering; (2) Injury occurs to such person in a motor vehicle accident in which the amount paid or accrued exceeds the medical-rehabilitative limit established in section 294-10(b) for expenses provided expenses provided in section 294-2(10)(A) [medical expenses] and (B) [therapy]; (3) Injury occurs to such person in such an accident and as a result of such injury the aggregate limit of no-fault benefits outlined in section 294-2(10) payable to such person are exhausted. This section shall apply whether or not the injured person is entitled to receive no-fault benefits. (b) No claim may be made for benefits under the uninsured motorist coverage by an injured person against an insurer who has paid or is liable to pay no-fault benefits to such injured person unless such claim meets the requirements of foregoing section (a)(1), (2) or (3). HRS § 294-6 (Supp.1984) (bold emphasis in original) (underscored emphasis added). Substantively, with respect to the issues on appeal, the statute has not changed since its original enactment in 1973, other than to state expressly that: (1) the tort threshold exceptions apply whether or not the injured person is entitled to receive no-fault benefits; and (2) the uninsured injured party cannot claim against the uninsured motorist coverage of the other party unless the injured party meets the same exceptions that permit suit in tort. The statute has also been further amended, but such amendments did not become effective until January 1, 1998 and, thus, do not apply to this appeal. Furthermore, even if they did, they would not alter this case substantively. [4] McAulton had purchased the vehicle for $800.00 and then spent approximately $3,500.00 modifying it, including covering the interior with black leather at a cost of $400.00. McAulton, 66 Haw. at 17 n. 4, 656 P.2d at 98 n. 4.