Case Name: Crelia CONDEMARIN, individually and as Guardian Ad Litem of Leonel Condemarin, and Jose Condemarin, Plaintiffs and Appellants, v. UNIVERSITY HOSPITAL, University of Utah, R.M. Larkin, M.D., Gayle M. Carter, M.D., Carlos Dibble, M.D., John Soper, M.D., Jane and John Does I through X, Defendants and Appellees
Court: Utah Supreme Court
Jurisdiction: Utah
Decision Date: 1989-05-01
Citations: 775 P.2d 348
Docket Number: No. 20602
Parties: Crelia CONDEMARIN, individually and as Guardian Ad Litem of Leonel Condemarin, and Jose Condemarin, Plaintiffs and Appellants, v. UNIVERSITY HOSPITAL, University of Utah, R.M. Larkin, M.D., Gayle M. Carter, M.D., Carlos Dibble, M.D., John Soper, M.D., Jane and John Does I through X, Defendants and Appellees.
Judges: HOWE, Associate C.J., concurs in the dissenting opinion of HALL, C.J.
Reporter: Pacific Reporter 2d
Volume: 775
Pages: 348–388

Head Matter:
Crelia CONDEMARIN, individually and as Guardian Ad Litem of Leonel Condemarin, and Jose Condemarin, Plaintiffs and Appellants, v. UNIVERSITY HOSPITAL, University of Utah, R.M. Larkin, M.D., Gayle M. Carter, M.D., Carlos Dibble, M.D., John Soper, M.D., Jane and John Does I through X, Defendants and Appellees.
No. 20602.
Supreme Court of Utah.
May 1, 1989.
Rehearing Denied July 11, 1989.
Timothy C. Houpt, Paul R. Lovell, Salt Lake City, for plaintiffs and appellants.
Merlin Lybert, David G. Williams, R. Paul Van Dam, William T. Evans, Salt Lake City, for defendants and appellees.

Opinion:
DURHAM, Justice:
This case raises important questions of first impression regarding the Utah Governmental Immunity Act. Utah Code Ann. § 63-30-1 to -38 (1986 & Supp.1988). It comes to us on an interlocutory appeal from the denial of plaintiffs' motion for a summary judgment striking certain provisions of the Act as unconstitutional.
The following facts were undisputed in the trial court. Plaintiff Crelia Condema-rin, who was pregnant with her second child, went to Cottonwood Hospital in the early morning of May 19, 1982, after several hours of labor and a suspected premature rupture of membranes. Because her treating physician anticipated a high risk delivery, she was transferred on his orders to the University Hospital in Salt Lake City. Plaintiff Leonel Condemarin was born at the University Hospital that same day after an emergency caesarean section. Attending physicians concluded that he suffered fetal distress and was "severely asphyxiated" at birth, which resulted in "severe neurologic damage," including impairments of hearing, sight, and ability to be fed, as well as a seizure disorder and spas-ticity.
The minor plaintiff's treating physician believes that the child will have a normal life span as a severely retarded and handicapped person. He believes there is little doubt that plaintiffs physical and mental defects are related to the asphyxia at the time of his birth. It is likely that the cost of medical and custodial care related to the severe neurologic disorder of Leonel Condemarin in its various aspects will greatly exceed the sum of $100,000.
Each of the individual defendants in this action and each person who provided care to plaintiffs at the University Hospital during the labor and delivery was an employee of the University Hospital or the University of Utah and was acting as such at the time in question.
I. Governmental Immunity and Hospitals
It is appropriate at this time in the evolution of the doctrine of governmental immunity to remind ourselves of its origins. In the 1961 case of Muskopf v. Coming Hospital District, 55 Cal.2d 211, 359 P.2d 457, 11 Cal.Rptr. 89 (1961), Justice Traynor detailed the history of the rule:
The shifting fortune of the rule of governmental immunity as applied to hospitals is illustrative of the history of the rule itself. From the beginning there has been misstatement, confusion, and retraction. At the earliest common law the doctrine of "sovereign immunity" did not produce the harsh results it does today. It was a rule that allowed substantial relief. It began as the personal prerogative of the king, gained impetus from sixteenth century metaphysical concepts, may have been based on the misreading of an ancient maxim, and only rarely had the effect of completely denying compensation. How it became in the United States the basis for a rule that the federal and state governments did not have to answer for their torts has been called "one of the mysteries of legal evolution." Borchard, Governmental Responsibility in Tort, 34 Yale L.J., 1, 4.
None of the reasons for its continuance can withstand analysis. No one defends total governmental immunity. In fact, it does not exist. It has become riddled with exceptions, both legislative . and judicial ., and the exceptions operate so illogically as to cause serious inequality. Some who are injured by governmental agencies can recover, others cannot: one injured while attending a community theater in a public park may recover {Rhodes v. City of Palo Alto, 100 Cal.App.2d 336, 341-342, 223 P.2d 639), but one injured in a children's playground may not {Farrell v. City of Long Beach, 132 Cal.App.2d 818, 819-920, 283 P.2d 296); for torts committed in the course of a "governmental function" there is no liability, unless the tort be classified as a nuisance {Phillips v. City of Pasadena, 27 Cal.2d 104, 106, 162 P.2d 625). The illogical and inequitable extreme is reached in this case: we are asked to affirm a rule that denies recovery to one injured in a county or hospital district hospital, although recovery may be had by one injured in a city and county hospital. Beard v. City and County of San Francisco, 79 Cal.App.2d 753, 755-768, 180 P.2d 744.
Id. at 214-215, 216, 359 P.2d at 458-59, 460, 11 Cal.Rptr. at 90-91, 92 (citations omitted).
Immunity from liability existed as a matter of common law in Utah for government entities engaging in governmental, as opposed to proprietary, activities. See Ramirez v. Ogden City, 3 Utah 2d 102, 104, 279 P.2d 463, 464 (1955), and cases cited therein. Section 63-30-3 of the Utah Governmental Immunity Act, effective July 1, 1966, provides for governmental immunity, unless waived, for "all governmental entities . for any injury which results from the exercise of a governmental function, governmentally-owned hospital . and from an approved . professional health care clinical training program conducted in either public or private facilities."
After the passage of the Act, this Court applied the traditional "governmental/proprietary" test until Standiford v. Salt Lake City Corp., 605 P.2d 1230 (Utah 1980). In that case, this Court rejected the test:
Originally, the proprietary-governmental distinction was created as a device to limit the harsh results produced by the doctrine of sovereign immunity. The doctrine operated on the basis that a public entity should be liable for the torts it committed in the exercise of a proprietary function but not for those committed in the exercise of a governmental function. See Gillmor v. Salt Lake City, 32 Utah 180, 89 P. 714 (1907); Sehy v. Salt Lake City, 41 Utah 535, 126 P. 691 (1912); Alder v. Salt Lake City, 64 Utah 568, 231 P. 1102 (1924); Rollow v. Ogden City, 66 Utah 475, 243 P. 791 (1926); Niblock v. Salt Lake City, 100 Utah 573, 111 P.2d 800 (1941). The distinction is, however, "one of the most unsatisfactory known to the law," Davis, Administrative Law, Ch. 9, "Tort Liability of Governments and of Officers," at 179.
Clearly, factors which may lead to such contrary and unpredictable results do not provide an adequate test upon which governmental agencies can rely in planning their budgets and providing for their tort liability, whether by way of insurance coverage or otherwise.
Id. at 1233, 1235 (citation omitted). Stan-diford set forth a new standard for determining governmental immunity under section 63-30-3: "whether the activity under consideration is of such a unique nature that it can only be performed by a governmental agency or . it is essential to the core of governmental activity." Id. at 1236-37.
Under the Utah Governmental Immunity Act, immunity is specifically waived for all government entities (1) as to contractual obligations, (2) as to actions involving real and personal property, (3) for negligent operation of nonemergency motor vehicles, (4) for defective highways, bridges, and other structures, and (5) for nonlatent defective conditions in public buildings and structures. Utah Code Ann. § 63-30-5 to -9. In addition, immunity of government entities is waived for injuries caused by employee negligence committed within the scope of employment except where the injuries arise out of certain specific activities listed in section 63-30-10(l)(a) to (l). Each of the excepted activities listed in section -10 is, interestingly, within the "core" of governmental functions discussed in Stan-diford. Each is of "such a unique nature that it can only be performed by a governmental agency or that it is essential to the core of governmental activity." Standi-ford, 605 P.2d at 1237.
The net result of this statutory classification scheme is that government-owned health care facilities, out of all the hundreds of government entities, have been singled out for "retained" immunity for npn governmental functions. Moreover, the notion of "retained" immunity is descriptively inaccurate, since such facilities and activities were not protected by immunity at common law or under the original version of the Utah Governmental Immunity Act.
It seems plain enough that the intent of [section 63-30-4] was to retain the then existing law, both as to immunity and as to liability, except for the nonexempt areas specifically set forth in Section 63-30-10 of the new act, none of which covers the operation of a hospital. It is therefore our conclusion that proprietary functions of a municipality are not within the coverage of the Utah Governmental Immunity Act.
Greenhalgh v. Payson City, 530 P.2d 799, 801 (Utah 1975) (citation omitted).
The 1978 amendments to the Utah Governmental Immunity Act also changed section 63-30-4(4). The amendment states: "[N]o employee may be held personally liable for acts or omissions occurring during the performance of the employee's duties, within the scope of employment or under color of authority, unless it is established that the employee acted or failed to act due to fraud or malice." Thus by simultaneously adding government-owned health care facilities to the category of government entities immune from suit, the legislature, via section 63-30-3, brought employees of those entities within the coverage of another change in the statute, in section 63-30-4(4). Consequently, immunity for the ministerial acts of employees of government entities performing nongovernmental functions was created, not "retained," by the 1978 amendments. Such immunity was a new development. In Frank v. State, 613 P.2d 517 (Utah 1980), this Court observed:
The Utah Governmental Immunity Act has no application to individuals; its function is confined to governmental "entities." Common-law principles of sovereign immunity have developed, however, which offer protection to the individual under certain circumstances. The case of Cornwall v. Larsen [571 P.2d 925 (Utah 1977)] stands for the proposition that a governmental agent performing a discretionary function is immune from suit for injury arising therefrom, whereas an employee acting in a ministerial capacity, even though his acts may involve some decision making, is not so protected.
Other reasons for the above holding are manifest. For one, it is contrary to reason to deny governmental immunity to a public employer and then grant it to the very employee allegedly causing the injury. Moreover, a grant of immunity in the present case would, of necessity, shield all practitioners employed, even under temporary contract from another source, by a governmental health care facility from any liability for malpractice.
Frank, 613 P.2d at 520 (citations omitted).
Thus the changes contained in the 1978 amendments to the Act created a number of classifications, including a special subclass of government-owned entities which are insulated, along with their employees, from liability for injuries resulting from nongovernmental functions. No other government entity is so insulated, and no other class of victims of negligence by government employees has been so treated.
The defendants in this case take the position that because sovereign immunity was a well-settled principle at the time the Utah Constitution was adopted, the challenged provisions of the Utah Governmental Immunity Act do not deprive plaintiffs of any remedies or property rights. This analysis overlooks the fact that at common law the proprietary or nongovernmental functions of government entities were not protected from liability in Utah, nor were their employees who performed those functions. Although it is generally true that the Utah Governmental Immunity Act expanded government liability, that is not the case with respect to proprietary or nongovernmental functions, and government employees performing operational (as opposed to discretionary) acts within the scope of governmental functions. In those two instances, the 1978 amendments restricted liability. In the first instance, where an employee is employed in nongovernmental activities, the right restricted is one which existed at common law.
Defendants also appear to regard the 1978 amendments to section 63-30-3 as having established that the operation of a governmentally owned health care facility is a "governmental function" under the state. It is true that this Court assumed as much in Frank v. State, 613 P.2d 517 (Utah 1980). We now observe, however, that the legislature did not make the operation of a health care facility a " 'governmental function' as contemplated by the statute," as the Court said in Frank. Rather, the legislature simply added to the category of government entities covered by section 60-30-3 (i.e., those exercising governmental functions) a new category consisting of government-owned health care facilities, whether or not those facilities are exercising governmental or nongovernmental functions. The plain language and structure of section 63-30-3 admit of no other construction. There is no doubt, of course, that health care facilities have the same status under the Act as government entities performing governmental functions. But that is precisely the classification challenged here — the special treatment of one class of government entity for protection of all of its functions, governmental and nongovernmental.
Defendants' position therefore confuses the analysis in two ways: First, it assumes without examination that all of the functions of the University of Utah Medical Center qualify as "governmental functions." As pointed out earlier, there is no statutory or factual basis for such an assumption. From this assumption proceeds generalizations about the high risk and high cost of activities which must be performed by government entities. Those arguments can only be persuasive if real, essential governmental functions are at issue. They do not have the same weight if nonessential, nongovernmental functions are involved. See generally Standiford, 605 P.2d 1230; Johnson v. Salt Lake City Corp., 629 P.2d 432 (Utah 1981). The Act does not purport to define the operation of a hospital per se as the exercise of a governmental function; it only gives hospitals the same status under the Act as government entities which are performing governmental functions.
Second, defendants' position collapses the classification issue into the recovery limits question. This interferes with the analysis of the article I, section 11 questions under the Utah Constitution. It is true, as defendants argue, that there is no fundamental right to recover unlimited damages from government entities performing governmental functions. In this case, however, the rights sought to be restricted include:
(1)The right to recover any damages from an employee performing nondiscre-tionary acts for a government employer who is engaged in nongovernmental functions;
(2) The right to recover full, rather than limited, damages from a government entity not performing governmental functions; and
(3) The right to recover full, rather than limited, compensation from a governmental tort-feasor.
II. Equal Protection
Under article I, section 24 of the Utah Constitution ("all laws of a general nature shall have uniform application"), a two-part test is necessary to ensure the uniform operation of the laws: "First, a law must apply equally to all persons within a class. Second, the statutory classifications and the different treatment given the classes must be based on differences that have a reasonable tendency to further the objectives of the statute." Malan v. Lewis, 693 P.2d 661, 670 (Utah 1984) (citations omitted). This Court recently noted:
State courts . have a long tradition, stretching back into the nineteenth century, of being far less willing to find that legislative classifications underlying economic regulations are reasonable. While state courts have been more deferential to legislative classifications at some times than at others, they have never abandoned their review function to the degree that the federal courts have since the mid-1930's. As a result, to pass state constitutional muster, a legislative measure must often meet a higher de facto standard of reasonableness than would be imposed by the federal courts.
Mountain Fuel Supply Co. v. Salt Lake City Corp., 752 P.2d 884, 889 (Utah 1988). We therefore first examine the reasonableness of the classifications in this statutory scheme and then assess the relationship between the classifications and the legislative objective.
As noted earlier, there are several classifications created by the statute at issue. Plaintiffs focus on the distinctions established between malpractice victims of governmental tort-feasors and victims of nongovernmental tort-feasors. A more subtle line, however, is drawn between the tort victims of different government entities and their employees, and that line depends upon the scope of the activities causing the injuries. Under the standard put forth by this Court in Standiford, "governmental functions" do not include activities not essential to government. Under section 63-30-3, however, even "nonessential" activities are protected by immunity when they are engaged in by a health care facility. That fact, in combination with the multiple waivers for numerous other governmental functions (most of them "essential"), results in a distinction between the tort victims of virtually every operational-level act classified as essential and the victims of medical malpractice by a government-employed or government-supervised medical service provider. As noted earlier, this is so because the Act waives immunity as to any contractual obligation, as to actions involving property, as to the negligent operation of nonemergency motor vehicles, as to injuries caused by defective, unsafe, or dangerous conditions of highways, public buildings, and other structures. Utah Code Ann. § 63-30-5, -9 (1986). Scrutiny of section 63-30-10, which contains a waiver of immunity for negligence and then a list of exceptions to the waiver, demonstrates that each exception relates directly to a "core" or "essential" function of government, e.g., law enforcement, health and welfare regulations, crowd control, tax assessment, corrections, land management, fire fighting, and so on.
The net result of this classification scheme is that the state, while choosing to conduct many enterprises that are not essential and necessary to governing, has chosen to retain immunity for only one of those activities — health care services — and to extend that immunity to its employees who function at an operational level rather than at a policy-making one. In doing so, the state has extended governmental immunity further than it ever reached at common law and, in the process, has abrogated a well-established common law right of recovery.
The amounts contained in the recovery limits statutes created yet another classification in addition to those summarized above. Not only are victims of medical malpractice by government personnel treated differently from victims of private tort-feasors, but also there are classifications within the victim group itself. Those whose injuries are minor may seek and recover all of their economic damages and some measure of noneconomic damages up to the recovery cap ($100,000 at the time of these injuries). Those whose economic losses approach or equal the statutory limit may recover only those losses and will receive no compensation for noneconomic losses. Finally, those whose economic losses exceed the statutory limit are precluded from even recovering out-of-pocket costs resulting from their injuries. The present case illustrates how grave the disparity between the limit and actual costs may be. The expenses of the minor plaintiffs medical care and treatment and his future education and maintenance as a severely handicapped person are likely to be many times the recovery limit created by the statute. The recovery cap created a distinction between victims of governmental tort-fea-sors, depending on the severity of their injuries: the mildly injured receive all; the moderately injured, most; and the severely injured, only a fraction or none of their economic and/or noneconomic damages.
To summarize, the reasonableness of the statutory classifications depends on the logic of the distinctions made, apart from the relationship between the classification and the legislative objective. There are two general types of classifications at issue here: first, a classification consisting of government-owned health care entities, whether or not they perform functions essential to the process of governing, as opposed to all other government entities, whose immunity depends on whether the activity causing the injury is a governmental function; and second, an indirect classification of injured victims which depends on whether their losses are less than, equal to, or greater than the statutory recovery cap and on whether those losses are largely economic, largely pain and suffering, or both.
As to the first general classification, defendants argue that it is rational to afford government-owned health care facilities special treatment vis-a-vis other government-owned entities because it is a reasonable means to protect the public treasury from the costs of medical malpractice insurance and/or large recoveries. The recovery limit is justified on the same basis. Under a rational basis standard of review, defendants conclude that the deprivation of common law rights to recovery and the arbitrary limitation of recovery to an amount that may or may not compensate victims even for their out-of-pocket medical expenses is rational. This conclusion reflects the almost total deference afforded legislative distinctions not based on suspect classifications under a traditional equal protection analysis. See Redish, Legislative Response to the Medical Malpractice Insurance Crisis: Constitutional Implications, 55 Tex.L.Rev. 759, 769-82 (1977). We are convinced that such deference is inappropriate when dealing with the fundamental principle of American law that victims of wrongful or negligent acts should be compensated to the extent that they have been harmed.
The New Hampshire Supreme Court was correct in identifying the specific right to recover for negligently caused injuries as an "important substantive right." Carson v. Maurer, 120 N.H. 925, 931, 424 A.2d 825, 830 (1980).
The importance of this right is seen not only from a purely compensatory perspective, but also as a function of the close relation it bears to other rights which are fundamental. Not only is the right to be compensated for injuries closely related to fundamental rights, but additionally, it does not logically fit into the "commercial" rights description which is characteristic of the rational basis standard of judicial review.
Note, Target Defendants and Tort Law Reform: A Perspective on Medical Malpractice and Municipal Liability, 11 Vt.L. Rev. 535, 546 (1986) (citations omitted).
The court in Carson said, "Whether the . statute can be justified as a reasonable measure in furtherance of the public interest depends upon whether the restriction of private rights sought to be imposed is not so serious that it outweighs the benefits sought to be conferred upon the general public." Carson, 120 N.H. at 933, 424 A.2d at 831 (citations omitted). The court was not willing to undertake an independent examination of the legislative justification for the statute, but it was willing to decide "whether the statute has a fair and substantial relation to this legitimate legislative objective and whether it imposes unreasonable restrictions on private rights." Id. at 934, 424 A.2d at 832.
It will be seen hereafter that the New Hampshire court's "middle tier" or "intermediate standard of review" permits precisely the balancing process that can be undertaken with a due process approach. The due process approach is more straightforward, but even under equal protection, some form of heightened scrutiny is warranted by the type of legislation at issue here. We applied such a "realistic rational basis" review to Utah's automobile guest statute in Malan v. Lewis, 693 P.2d 661 (Utah 1984), and we should do so here. In explaining what such a realistic review would entail, I quote liberally from the dissent in Fein v. Permanente Medical Group, 38 Cal.3d 137, 695 P.2d 665, 211 Cal.Rptr. 368 (1985), which calls the majority to task for abandoning that standard of equal protection analysis in California.
At issue in Fein were provisions of California's Medical Injury Compensation Reform Act (MICRA) which, among other things, limited recovery of noneconomic damages for medical malpractice. The majority of the court upheld the limitations against an equal protection challenge. The dissent observed:
The majority's acceptance of rationales so broad and speculative that they could justify virtually any enactment calls attention to the implications of the MICRA cases for equal protection doctrine in this state. In American Bank [and Trust Company v. Community Hospital of Los Gatos-Saratoga, Inc.], supra, 36 Cal.3d [359] at page 398, 204 Cal.Rptr. 671, 683 P.2d 670 [ (1984) ] (dis. opn. of Bird, C.J.), I joined a majority of this court in rejecting the notion of "intermediate" equal protection scrutiny. However, I conditioned that rejection on the belief — grounded in the past practice of this court — that the alternative was a two-tier system with a meaningful level of scrutiny under the lower tier. (Id., at pp. 398-401, 204 Cal.Rptr. 671, 683 P.2d 670; see also Hawkins v. Superior Court (1978) 22 Cal.3d 584, 607-610, 150 Cal.Rptr. 435, 586 P.2d 916 (conc. opn. of Bird, C.J.).)
In particular, I relied on Brown v. Merlo, supra, 8 Cal.3d 855, 106 Cal.Rptr. 388, 506 P.2d 212 [ (1973) ]. In Brown, this court conducted a serious and sensitive inquiry into the nature and purposes of the automobile guest statute. The court demanded not only that the enactment might tend to serve some conceivable legislative purpose, but also that each classification bear a fair and substantial relationship to a legitimate purpose. (Id., at p. 861, 106 Cal.Rptr. 388, 506 P.2d 212.) The guest statute failed to pass this level of scrutiny since the classification of all automobile guests bore an insufficiently precise relation to the asserted purposes. For example, the classification was held to be overinclusive with regard to the purpose of preventing collusive suits. (Id., at p. 877, 106 Cal.Rptr. 388, 506 P.2d 212.) Brown was subsequently followed in Cooper v. Bray, supra, 21 Cal.3d 841, 148 Cal.Rptr. 148, 582 P.2d 604 [ (1978) ].
If applied in the present case, the mode of analysis used in Brown and Cooper would compel invalidation of the $250,000 limit, which is grossly underinclusive by any standard. Millions of healthcare consumers stand to gain from whatever savings the limit produces. Yet, the entire burden of paying for this benefit is concentrated on a handful of badly injured victims — fewer than 15 in the year MICRA was enacted. (See Report of the Auditor General, supra, at p. 31.) Although the Legislature normally enjoys wide latitude in distributing the burdens of personal injuries, the singling out of such a minuscule and vulnerable group violates even the most undemanding standard of underinclusiveness.
Fein, 38 Cal.3d at 174-75, 695 P.2d at 691-92, 211 Cal.Rptr. at 394-95 (Bird, C.J., dissenting).
The Idaho Supreme Court in Jones v. State Board of Medicine, 97 Idaho 859, 555 P.2d 399 (1976), has also articulated a heightened standard of review based on the federal intermediate equal protection review:
In the usual and ordinary case where a statutory classification is to be tested in the context of equal protection, judicial policy has been, and continues to be, that the legislation should be upheld so long as its actions can reasonably be said to promote the health, safety and welfare of the public. Nevertheless, where the discriminatory character of a challenged statutory classification is apparent on its face and where there is also a patent indication of a lack of relationship between the classification and the declared purpose of the statute, then a more stringent judicial inquiry is required beyond that mandated by McGowen [y. Maryland, 81 S.Ct. 1101, 6 L.Ed.2d 393 (1961) ]. That common thread runs through all the cases in which the Roster-Reed test has been applied by this Court.
Here it is apparent from the face of the Act that a discriminatory classification is created based on the degree of injury and damage suffered as a result of medical malpractice. Rather obviously although the Act is said to be designed to insure continued health care to the citizens of Idaho it cannot do other than confer an advantage on doctors and hospitals at the expense of the more serious ly injured and damaged persons. In the absence of any record we are without information as to the factual basis underlying the purported correlation between limitation of claimant recovery and the promotion of health care for the people of Idaho. We therefore deem it essential that the purposes of the Act and the relationship of the legislatively designed means to accomplish those purposes must be examined.
Id. at 871, 555 P.2d at 411.
Other courts have applied a heightened standard of equal protection scrutiny to statutes limiting recovery rights in the medical malpractice area. See Coburn ex rel. v. Agustín, 627 F.Supp. 983, 991-97 (D.Kan.1985); Farley v. Engelken, 241 Kan. 663, 740 P.2d 1058, 1063-65 (1987); Arneson v. Olson, 270 N.W.2d 125, 132-33 (N.D.1978); Hoem v. State, 756 P.2d 780 (Wyo.1988). Some courts have characterized their review as one at an intermediate level, and some have referred to it as a "realistic" review under the rational basis standard. Both approaches, however, involve a real and thoughtful examination of legislative purpose and the relationship between the legislation and that purpose. In the present case, the legislature has not only limited recovery, but it has also extended partial governmental immunity to restrict rights which existed at common law. Therefore, I would apply a heightened standard of review under equal protection.
III. The Due Process Alternative
The parties argued this case as an equal protection problem. The traditional rational basis approach, however, takes inadequate account of the seriousness of the abrogation of personal rights accomplished by the Act, and a more straightforward balancing process is required. That balancing should be accomplished by means of a due process, rather than an equal protection, analysis.
Historically, the overlap between equal protection analysis and due process analysis has been considerable. As this Court phrased the test for equal protection under article I, section 24 of the Utah Constitution in Malan v. Lewis, 693 P.2d 661 (Utah 1984), "First, a law must apply equally to all persons within a class. Second, the statutory classifications and the different treatment given the classes must be based on differences that have a reasonable tendency to further the objectives of the statute." Id. at 670 (citations omitted). Citing McLaughlin v. Florida, 379 U.S. 184, 191, 85 S.Ct. 283, 288, 13 L.Ed.2d 222 (1964), we agreed that "[t]he courts must reach and determine the question whether the classifications drawn in a statute are reasonable in light of its purpose_" Id. at 673. Most recently, in Mountain Fuel Supply Co. v. Salt Lake City Corp., 752 P.2d 884, 890 (Utah 1988) (citation omitted), we phrased the test as follows: "[The] test to be applied under article I, section 24 is whether the classification of those subject to the legislation is a reasonable one and bears a reasonable relationship to an achievement of the legitimate legislative purpose."
The similarity of that test to a means-end review under the doctrine of due process is striking: "If the laws passed are seen to have a reasonable relation to a proper legislative purpose, and are neither arbitrary nor discriminatory, the requirements of due process are satisfied...." Nebbia v. New York, 291 U.S. 502, 537, 54 S.Ct. 505, 516, 78 L.Ed. 940 (1934); see also Pruneyard Shopping Center v. Robins, 447 U.S. 74, 84-85, 100 S.Ct. 2035, 2042-2043, 64 L.Ed.2d 741 (1980).
This overlap is not surprising in view of the fact that both tests seek to ensure, as a matter of constitutional doctrine, that "legislative action . be rationally related to the accomplishment of some legitimate state purpose." Bennett, "Mere" Rationality in Constitutional Law: Judicial Review and Democratic Theory, 67 Calif.L.Rev. 1049 (1979).
This rationality requirement has been advanced as the most minimal of consti tutional limitations on legislative action. It has been variously phrased and has appeared in several constitutional guises, most prominently as an elaboration of the due process and equal protection guarantees.
Id. (footnote omitted).
The difficulty with the equal protection analysis undertaken by the dissent is that it does not account for what is or what should be actually going on in this Court's scrutiny of legislative abrogation of common law causes of action. Characterizing plaintiffs' rights here as "nonfundamental" would virtually insure that the legislative action will be found constitutional under the rational basis standard. As previously pointed out, some commentators and a number of courts have incorporated an intermediate or realistic level of scrutiny into their equal protection framework in order to achieve the flexibility needed to balance state interests against individual rights. I suggest that a more open, straightforward performance of the balancing function under the due process framework is in order.
Because the disputes that arise under the rubric of the Equal Protection Clause have to do with the relative merits of competing, public policies, judicial decisions obscure the central issues in such cases to the extent that they are based on discussions of a statute's rationality. The nature of the conflict between the political values at stake as well as the underlying bases of judicial reasoning would be made more explicit if the competing public policies were weighed outright. .
Note, Legislative Purpose, Rationality, and Equal Protection, 82 Yale L.J. 123, 154 (1972-73) (footnotes omitted).
We are required to assess the reasonableness of the legislative expansion of governmental immunity contained in section 63-30-10 against the degree of intrusion on rights protected by the Utah Constitution. That is the essence of the requirement of due process under our constitution. See Utah Const, art. I, § 7.
Article I, section 11 of the Utah Constitution guarantees: "[Ejvery person, for an injury done to him in his person, property or reputation, shall have remedy by due course of law...." In Berry ex rel. Berry v. Beech Aircraft Corp., 717 P.2d 670, 675 (Utah 1985), we determined that the clear implication of this language is "that an individual [may] not be arbitrarily deprived of effective remedies designed to protect basic individual rights."
[T]he basic purpose of Article I, section 11 is to impose some limitation on [the power of the Legislature to create new rules of law and to abrogate old ones] for the benefit of those persons who are injured in their persons, property or reputations since they áre generally isolated in society, belong to no identifiable group, and rarely are able to rally the political process to their aid.
Id. at 676.
To a degree, the open courts provision is an extension of the due process clause. Indeed, the open courts provision and the due process clause also have an overlapping function, to some extent, with respect to the abrogation of causes of action. If the Legislature were to abolish all causes of action for injuries to one's person or property caused by defective products and provide no substitute equivalent remedy, we have little doubt that that would violate section 11, and perhaps even the due process clause of Article I, section 7.
Id. at 679.
Indeed, the two-part test articulated in Berry, at least in part, requires a classic due process analysis:
First, section 11 is satisfied if the law provides an injured person an effective and reasonable alternative remedy . for vindication of his constitutional interest. The benefit provided by the substitute must be substantially equal in value or other benefit to the remedy abrogated in providing essentially comparable substantive protection to one's person, property, or reputation, although the form of the substitute remedy may be different.
Second, if there is no substitute or alternative remedy provided, abrogation of the remedy or cause of action may be justified only if there is a clear social or economic evil to be eliminated and the elimination of an existing legal remedy is not an arbitrary or unreasonable means for achieving the objective.
Id. at 680.
The analytic process presented in Berry under article I, section 11 of the Utah Constitution was referred to as a "balancing analysis." Id. at 683. The Court examined the legitimacy of the legislative purpose and the extent to which said purpose was reasonably and substantially advanced by the means utilized and compared those "benefits" to the denial of rights protected by article I, section 11. The opinion identified a special class of constitutional rights which are afforded protection under article I, section 11. Legislative attempts to abrogate those rights should be closely examined by this Court and struck down when the disability they seek to impose on individual rights is too great to be justified by the benefits accomplished or when the legislation is simply an arbitrary and impermissible shifting of collective burdens to individual citizens.
By means of (1) extending immunity to employees of all government-owned health care facilities and (2) imposing a blanket cap on all recoveries, the legislature has sought to respond to what the University Hospital and the attorney general in his amicus brief describe as a "financial crisis" in state liability and liability insurance. No factual information regarding the alleged crisis has been cited to this Court, either from the legislative history of the Act, the evidentiary record in the court below, or reliable sources of which this Court could legitimately take judicial notice. Indeed, most of the attorney general's sources are newspaper articles from other states, and the majority of them deal with municipal, rather than state, liability problems. The state asks this Court to engage in the kind of speculation about legislative rationale associated with the "any conceivable rational basis test." However, because of the constitutional status of the right to a remedy for damage to one's person under article I, section 11, more is required.
A legislative determination to interfere with, limit, or abrogate the availability of remedies for injuries to person, property, or reputation requires an important state interest and a rational means of implementation. The greater the intrusion upon the constitutionally protected interest, the greater and more explicit the state's reasons must be. It is necessary for the legislature, first, and this Court, second, to balance the weight of the governmental interest at stake against the countervailing importance of the individual rights being compromised.
This due process approach offers some degree of flexibility. Under equal protection, the selection of the standard of review virtually determines the outcome, and selection of the standard of review depends in turn on a rather rigid system of classification of the individual rights in question.
Most frequently, the level of protection which the courts will afford the constitutional provision depends on the nature of the substantive right being asserted in the underlying claim. If the substantive right is deemed to be "fundamental," statutory restrictions will be examined very closely under the strict scrutiny test; only the presence of a compelling state interest will justify the restriction or denial of access to the courts. If, on the other hand, the substantive right being asserted is not the subject of a specific constitutional protection and is therefore not fundamental, then the rational basis test provides that access to the courts may be restricted if a rational or reasonable basis for the restriction is shown.
Note, Constitutional Law: Statutorily Required Mediation as a Precondition to Lawsuit Denies Access to the Courts, 45 Mo.L.Rev. 816, 319-20 (1980) (footnotes omitted).
State supreme courts have uniformly-held that medical malpractice legislation does not create suspect classifications or implicate fundamental interests.[ ] Accordingly, no state court has applied or discussed applying the strict scrutiny test to equal protection challenges to damage limitation laws.
Rather, the decisive issue in the cases has been the decision whether to apply the rational basis test or an intermediate level of review. Just as the choice between the strict scrutiny and rational basis tests is outcome determinative under traditional equal protection analysis, it appears that the choice between the rational basis test and the intermediate test will predict the result of equal protection challenges to medical malpractice damages limitations statutes. Of eight courts that have discussed the equal protection issue, three applied an intermediate test, and four applied the rational basis test. In one the standard chosen was unclear. Of the three courts that chose intermediate scrutiny, two held the statute unconstitutional and one remanded for more information. In contrast, no state court that has applied the rational basis test has failed to find the statute in question constitutional.
Richards, Statutes Limiting Medical Malpractice Damages, 32 Fed'n Ins.Couns.Q. 247, 253 (1982) (citations omitted; emphasis added).
Once the applicable standard of review is determined, it is applied to the damage limitation statute. If the rational basis test is applied, the court generally will defer to the legislative judgment, reflected in the statute, that the classification is rationally related to a legitimate state purpose. For instance, in Fein v. Permanente Medical Group, the plaintiff argued that the California statute limiting pain and suffering damages in medical malpractice cases violated equal protection because "the alleged 'crisis' pursuant to which the legislation was enacted was largely fabricated." The court noted that the plaintiff was asking it to reconsider the legislature's findings, which it refused to do under the rational basis test.
In stark contrast, when the intermediate level test is applied, the courts are willing to scrutinize the basis for the legislative decision to limit damages far more closely. The Idaho Supreme Court was clearly skeptical that any crisis existed in Idaho and remanded for determination of whether malpractice claims had caused increased insurance rates and whether the damage limitation would actually stabilize insurance rates. The New Hampshire Supreme Court was unable to find the necessary relationship between the legislative goal of rate reduction and the damage limitation statute because "paid out damage awards constitute only a small part of total insurance premium costs [and] few individuals suffer noneconomic damages in excess of $250,000."
Thus, the functional difference between the rational basis test and the intermediate test is the degree to which the legislative judgment reflected in the statute will be examined. The practical difference is that under the rational basis test the statute will surely be found constitutional while the opposite result is likely if the intermediate test is applied. At any rate, the crucial issue in such cases remains which standard of review the court chooses to apply.
Id. at 256-57 (citations omitted; some emphasis added); see also Farrell, Virginia's Medical Malpractice Cap and the Doctrine of Substantive Due Process, 23 Tort & Ins.L.J. 684 (1988).
As was clear in our opinion in Berry, this Court is not prepared to hold that the rights protected in article I, section 11 are "fundamental" in the traditional equal protection sense.
[Sjection 11 rights are not always paramount, either. They do not sweep all other constitutional rights and prerogatives before them.... Similarly, legal causes of action which provide remedies that protect section 11 interests may, in some cases, have to yield to the power of the Legislature to promote the public health, safety, morals, and welfare.
For example, the Legislature has abolished certain common law remedies for personal injuries and substituted other remedies pursuant to the Workmen's Compensation Act and the Occupational Disease Act. These remedies are different from, and in some ways, broader than, the common law remedies they displace. The Legislature has also substituted a nonjudicial remedy for certain kinds of damages caused by personal injuries sustained in automobile accidents. The Utah No-Fault Automobile Insurance Act, U.C.A., 1953, § 31-41-1, et seq., provides an insurance remedy for special damages in lieu of a common law remedy.
Berry, 717 P.2d at 677 (citation and footnotes omitted).
On the other hand, by construing article I, section 11 in Berry as "an extension of the due process clause," we committed ourselves to something more than a "rational basis" deference under the equal protection doctrine.
In sum, section 11 does not recede before every legislative enactment, but neither may it be applied in a mechanical fashion to strike every statute with which there may be conflict....
We hold that section 11 . and the prerogative of the legislature are properly accommodated by applying a two-part analysis. First, section 11 is satisfied if the law provides an injured person an effective and reasonable alternative remedy "by due course of law" for vindication of his constitutional interest. The benefit provided by the substitute must be substantially equal in value or other benefit to the remedy abrogated in providing essentially comparable substantive protection to one's person, property, or reputation, although the form of the substitute remedy may be different....
Second, if there is no substitute or alternative remedy provided, abrogation of the remedy or cause of action may be justified only if there is a clear social or economic evil to be eliminated and the elimination of an existing legal remedy is not an arbitrary or unreasonable means for achieving the objective.
Id. at 680.
Thus, we identified the right to recover for personal injuries as an important substantive right. "The right to be [compensated] for personal injuries is a substantial property right, not only of monetary value but in many cases fundamental to the injured person's physical well-being and ability to continue to live a decent life." Hunter v. North Mason High School Dist., 85 Wash.2d 810, 814, 539 P.2d 845, 848 (1975). Berry articulated the outlines of what is essentially a due process balancing test, wherein the exigencies associated with the "social or economic" evils addressed by legislation must be weighed against the reasonableness of its intrusion upon personal rights. We simultaneously identified in Berry a separate due process approach, the "quid pro quo" or "substitute remedy" test. The right to recover for personal injuries should be evaluated under these tests.
IV. Due Process Analysis
To the extent that section 63-30-3 created immunity for employees of government-owned health care facilities not engaged in governmental functions, it created immunity where none had existed at common law. Furthermore, excepting such entities from the broad scope of entities and activities for which immunity is waived in sections 63-30-4 through -10 also treated health care facilities differently from all other government entities irrespective of the governmental-nongovernmental activities distinction (he., immunity was waived as to many other entities for activities that were clearly essential to the core of government). This extension of immunity had the effect of substituting the remain ing statutory negligence remedy for a common law cause of action against both the entity and the allegedly negligent employee. See Frank v. State, 613 P.2d 517, 520 (Utah 1980). Tort victims under this scheme received the right to recover from health care entities up to a maximum of $100,000, regardless of the seriousness of their injuries. The victims' burden of showing fault as a precondition to recovery was not changed.
If we were prepared to sustain the $100,-000 recovery limitation, we would be constrained to conclude that this statutory provision fails the adequate substitution remedy portion of the test in Berry. In the absence of any damages limitation, however, the question would become a much closer one. The tort victim under those circumstances, while losing the right to recover from the government employee, would retain the right to recover from the government entity for the negligence of its employee. There is no reason to believe that individual employees of health care entities are more able than their employers to respond in damages or that the entities themselves are likely to be judgment-proof. It would seem to make no difference to the employee unless the total amount of recovery is affected by the statute. For that reason, it appears to be only to the extent that section 63-30-3 brings health care entities (not engaged in essential governmental activities) within the purview of the recovery limits statutes that it is challenged by these plaintiffs. The determinative question is therefore whether the recovery cap can be regarded as a reasonable, nonarbitrary limitation on the right to recover for tortious injuries in a context where a common law right to recovery has been restricted.
With a damage limit of $100,000, the legislature has determined that the cost of protecting the public treasury shall be borne by those few persons most seriously injured by the negligence of government health care entities and their employees. Having first expanded immunity and then waived it, the legislature set out to accord the victims of governmental tort-feasors the same status as victims of private tort-feasors. With the recovery cap, however, the legislature has in effect retracted the waiver of immunity for the seriously injured. The statute directly prohibits those who are injured from recovering compensation for proven injuries solely because those injuries have been inflicted by government health care providers.
Defendants essentially argue that government health care entities cannot afford to pay for the serious injuries they cause and that the state may therefore choose to compensate fully those whose injuries are minor but make what may be token payments to those with severe injuries. The circumstances of these plaintiffs are illustrative; it is unlikely that the recovery limit amount would pay more than a fraction of plaintiffs' actual medical expenses, leaving nothing to offset the expenses of lifetime care. Thus, the burden of this legislative attempt to protect the state treasury falls exclusively on those most in need of financial protection.
In a related analytic context, a substantial majority of courts addressing damages limits in medical malpractice statutes have invalidated those limits, usually on equal protection grounds, but also occasionally under a due process rubric. See, e.g., Coburn ex rel. Coburn v. Agustín, 627 F.Supp. 983, 997 (D.Kan.1985); Waggoner v. Gibson, 647 F.Supp. 1102, 1107 (N.D.Tex.1986); Wright v. Central Du Page Hosp. Ass'n, 63 Ill.2d 313, 329-30, 347 N.E.2d 736, 743 (1976); Kansas Malpractice Victims v. Bell, 243 Kan. 333, 757 P.2d 251 (1988); Farley v. Engelken, 241 Kan. 663, 678, 740 P.2d 1058, 1068 (1987); Carson v. Maurer, 120 N.H. 925, 936, 424 A.2d 825, 838 (1980); Arneson v. Olson, 270 N.W.2d 125, 136 (N.D.1978); Simon v. St. Elizabeth Medical Center, 3 Ohio Op.3d 164, 166-167, 355 N.E.2d 903, 906-07 (Ohio Misc.1976) (dictum); Baptist Hosp. of Southeast Texas, Inc. v. Baber, 672 S.W.2d 296, 298 (Tex.1984); cf. Smith v. Department of Insurance, 507 So.2d 1080 (Fla.1987); Jones v. State Bd. of Medicine, 97 Idaho 859, 876, 555 P.2d 399, 416, cert. denied, 431 U.S. 914, 97 S.Ct. 2173, 53 L.Ed.2d 223 (1976) (remanding for factual determination on whether a medical malpractice crisis actual existed); Lucas v. United States, 757 S.W.2d 687 (Tex.1988); Hoem v. State, 756 P.2d 780 (Wyo.1988). But see Johnson v. St. Vincent Hosp., Inc., 273 Ind. 374, 400, 404 N.E.2d 585, 601 (1980) (upholding limitations where there is a partial alternative remedy).
The kind of "crisis" intervention which motivated the passage of medical malpractice damages limits strongly resembles the "crisis rationale" relied upon by the state in this case to justify limits on damages in governmental immunity cases. The focus on increasing insurance premiums and the argument that governments (like some physicians) will be "out of business" absent legislative intervention are strikingly similar. It must always be borne in mind that the legislature has here chosen both to expand governmental immunity protection beyond its scope at common law and to draw limits which affect only a few victims after a blanket waiver of immunity for certain kinds of negligence. "A crisis," as political scientist Paul Starr has noted, " 'can be a truly marvelous mechanism for the withdrawal or suspension of established rights, and the acquisition and legitimation of new privileges.' " Note, California's Medical Injury Compensation Reform Act: An Equal Protection Challenge, 52 So.Cal.L.Rev. 829, 935 n. 623 (1979) (quoting Bernzweig, forward to T. Lombardi, Jr., Medical Malpractice Insurance, 118-19 (1978)).
The harsh, unfair, and irrational impact of the doctrine of governmental immunity historically has led courts, and then legislatures, to respond by making governments more readily accountable for the costs of governing:
Even where liability would not be an unwanted deterrence, the question remains of the extent to which it is desirable to compensate out of public funds those injured by what government does in the public interest. The older view chose to sacrifice the individual claim altogether, except within the narrow confines of a taking of property in the constitutional sense. But the whole trend of modern thinking is toward compensating the victims of enterprise and distributing their losses. Even conservatives would do this where the victim is innocent, where his injury is of a kind already recognized in private tort law, and where there is fault in conducting the enterprise. The device of government liability offers machinery for both compensation and distribution; it should be used to compensate the victims of government at least to the full extent of the fault principle except in situations where there are cogent reasons of extrinsic policy for withholding compensation.... [WJhere such claims represent the kind of injury courts conventionally recognize — especially physical injury . — their magnitude simply reflects the size of the injury which large-scale and perhaps increasingly dangerous activity by government may inflict on its citizens. It would change the essential picture only when the liability was so crushing that it reflected wholesale destruction of the social wealth in a way that would spell a breakdown for any system of liability.
James, Tort Liability of Governmental Units and Their Officers, 22 U.Chi.L.Rev. 610, 653-54 (1955) (footnotes omitted).
Some commentators have gone so far as to argue that "the naked existence of sovereign immunity constitutes an equal protection violation by irrationally distinguishing between victims of private and sovereign negligence." Murray & Murray, The Unconstitutionality of Sovereign Immunity in Ohio — Last Stand for the Illegitimate King, 18 U.Tol.L.Rev. 77, 112 (1986). I do not advocate this extreme position. This Court, however, ought not defer to legislative retention or expansion of governmental immunity which unreasonably burdens important constitutional rights. The recovery limitation in the Utah Governmental Immunity Act on all damages caused by government-owned health care providers and their employees is such an unreasonable burden. There is no factual showing in the legislative history or the trial court that the recovery limitation is reasonably necessary for preservation of the public treasury. It is true, of course, that there will be less cost to the state and insurance will be more readily obtainable if the state does not have to respond in damages in excess of $100,000 for injuries caused by its health care entities and employees or insure against those damages. However, before the state is permitted to conserve those monies at the expense of seriously injured citizens, its citizens are entitled to a showing in the courts that a measure so drastic and arbitrary as a $100,000 cap on all damages is urgently and overwhelmingly necessary.
We do not hold that the state may not preserve its ability to govern by avoiding payments for catastrophic losses. If the actual solvency of a public entity, such as the state, is threatened, the balance obviously might shift in favor of the collective public interest in the continuity of public services. Furthermore, in view of the economic uncertainties in question, it might be reasonable, we believe, for the legislature to settle upon and justify an approximate figure demonstrated to be large enough to compensate a majority of injuries (minor and serious) but not so large as to threaten or ensure insolvency in response to one judgment or a major catastrophe. Over twenty years ago, Professor Arvo Van Alstyne, in his comprehensive essay Governmental Tort Liability: A Decade of Change, 1966 Univ.Ill.L.Forum 919 (1966), anticipated the balancing process that is necessary:
The fiscal approach assumes the validity of the fears, often articulated by spokesmen for public entities, that full tort responsibility entails the risk of insolvency, or at least of intolerable tax burdens, in the event that a major catastrophe becomes the basis of liability. By providing a specific, albeit essentially arbitrary, basis for fiscal planning and acquisition of insurance coverage, dollar limits avoid the risk of calamitously high judgments.
Unfortunately, the ideal of equal justice pays a high price for this contemplated fiscal security; it seems obvious that instances will arise in which the maximum damages allowable will bear no rational relationship to the actual damages sustained, and equally deserving claimants will receive grossly dispro portionate awards. Indeed, the necessarily discriminatory consequences of statutory damage limits, under which some individuals injured by public employees will be treated less favorably than others for purely fortuitous reasons, suggests possible constitutional difficulties.... Moreover, experience suggests and legislative developments in other states confirm that adequate alternative ways for resolving the catastrophe judgment problem are readily available, that equal justice and fiscal stability need not be an-' tagonistic objectives. In any event, the suggested rationale is in sharpest focus with respect to small public entities of limited fiscal resources; yet, paradoxically, in each of the states which have adopted damage limits, the statutes doing so are fully applicable to the very largest public entities possessing the broadest fiscal capabilities for risk distribution.
Id. at 971-72 (footnotes omitted); see also Spader, Immunity v. Liability and the Clash of Fundamental Values: Ancient Mysteries Crying out for Understanding, 6 Chi.[-]Kent L.Rev. 61 (1985).
In my view, section 63-30-3 and the recovery limits statutes, operating in conjunction, are unconstitutional. That view is concurred in by Justice Zimmerman. Justice Stewart's concurring opinion, although it agrees with this analysis of the interaction of the two statutes, opts to strike down only the damage cap provision, leaving section 63-30-3 intact. I think it would be preferable to strike both statutes, leaving the legislature free to restructure the immunity statutes as it sees fit.
V. Tort Liability and Deterrence
The approach taken by the state in this case focuses on victims' rights to compensation and the public benefits to be acquired through limitations of those rights. We have already indicated that the restrictions embodied in the $100,000 recovery cap are an unjustified intrusion on constitutionally protected substantive rights to compensation for negligently inflicted injuries caused by health care providers not performing essential governmental functions. We also believe that the balance struck by the legislature ignores the goal of deterrence:
The association of negligence with purely compensatory damages has prompted the erroneous impression that liability for negligence is intended solely as a device for compensation. Its economic function is different; it is to deter uneconomical accidents. As it happens, the right amount of deterrence is produced by compelling negligent injurers to make good the victim's losses. Were they forced to pay more (punitive damages), some economical accidents might also be deterred; were they permitted to pay less than compensation, some uneconomical accidents would not be deterred. It is thus essential that the defendant be made to pay damages and that they be equal to the plaintiff's loss. But that the damages are paid to the plaintiff is, from an economic standpoint, a detail.
R. Posner, Economic Analysis of Law, § 6.12, at 143 (1972) (footnote omitted).
Although deterrence-related concerns have been seen as problematic when applied against government entities, they have traditionally been viewed as central to influencing the behavior of medical professionals.
Underlying public policy goals or perceptions determine the balance between compensation and deterrence for any type of negligence liability. This balance is a variable which differs, depending on the particular activity or class of activity concerned.
Many courts and commentators have puzzled over why such an anachronistic and unsupported concept as governmental immunity was so difficult to dissolve. The answer (or part of the answer), perhaps lies in what seems to be an identifiable, public policy undercurrent which suggests that governmental entities are less in need of deterrent incentives than are other classes of tortfeasors. This is because, while health care providers and other private sector actors operate in essentially an economic marketplace, gov ernmental bodies operate in a political marketplace. As such, adverse judgments through the tort process serve a more direct and important deterrent role in private sector decision-making than in the public sector.
If it can be accepted that governmental immunity persisted because of a no need to deter policy, then it is easier to understand why the obligation to compensate, by itself, was so slow in causing a shift in the balance between societal and individual interests. On the other hand, there has long been a recognized need for tort law deterrence among professionals generally, and among health care providers specifically.
Note, Target Defendants and Tort Law Reform, 11 Vt.L.Rev. at 567-68 (footnotes omitted).
The problem with Utah's Governmental Immunity Act is that it has created limited liability under the screen of governmental immunity for activities which were traditionally subject to the deterrent effects of tort liability. Furthermore, notwithstanding the fact that it is a government-owned health care facility, the University Hospital, in its patient care programs, virtually operates in the private sector, competing with other private, nonprofit entities, as well as with for-profit hospitals. In the area of patient service, it is not in the business of establishing government policy. For that reason, the common law exception existed to prevent governmental immunity from barring medical malpractice actions in Utah, and for that reason, the deterrence factor in the balancing analysis this Court should apply weighs in favor of liability, not limitation.
In this balance, the public interest in limiting victims' rights must be weighed against the individual interest in compensation as well as the benefits accruing to a safer society through the general deterrence of harmful or negligent conduct. When the full scope of consideration is given, the legitimacy of various limitations on rights or remedies can more accurately be measured.
Note, Target Defendants and Tort Reform, 11 Vt.L.Rev. at 566.
VI. Recovery Limitation and Right to a Jury Trial
In International Harvester Credit Corp. v. Pioneer Tractor and Implement, Inc., 626 P.2d 418 (Utah 1981), this Court held that the right of jury trial in civil cases is guaranteed by article I, section 10 of the Utah Constitution. An arbitrary limit on damages awarded by juries, in my view, seriously infringes upon that right:
The jury historically has been an integral part of the Anglo-American legal system. It would require the clearest language to sustain the conclusion that there was an intention to abolish an institution so deeply rooted in our basic democratic traditions and so important in the administration of justice, not only as a buffer between the state and the sovereign citizens of the state, but also as a means for rendering justice between citizens. We refuse to give a strained meaning to the terms of our Constitution which would result in dispensing with an institution that has the sanction of the centuries.
International Harvester, 626 P.2d at 420.
A recent federal district court case, Boyd v. Bulala, 672 F.Supp. 915 (W.D.Va.1987), contains a similar ruling as a matter of federal constitutional law in a diversity action for medical malpractice. The court's opinion summarized the history of the seventh amendment and concluded: "This necessarily foreshortened history of the seventh amendment thus reveals that the right to a civil jury trial was intended to serve as an important cheek upon the legislature and the judiciary." Id. at 919. The court examined a Virginia statute containing recovery caps in medical malpractice cases:
By limiting recovery in this way, the statute substantially diminishes the role of the jury in determining damages, at least in cases such as this, where the •proven damages far exceed the amount of the cap. Constitutional analysis must therefore focus on whether the seventh amendment guarantees the determination of damages by a jury, bearing in mind that the Supreme Court's admonition that "[mjaintenance of the jury as a fact-finding body is of such importance and occupies so firm a place in our history and jurisprudence that any seeming curtailment of the right to a jury trial should be scrutinized with the utmost care."
672 F.Supp. at 919-20 (emphasis added) (quoting Dimick v. Schiedt, 293 U.S. 474, 486, 55 S.Ct. 296, 301, 79 L.Ed. 603 (1935); see also Kansas Malpractice Victims v. Bell, 243 Kan. 333, 757 P.2d 251, 258-60 (1988).
Noting that the treatment of additur and remittitur under the seventh amendment "confirm[s] that the determination of damages is part of the 'substance of the common law right of trial by jury' " (quoting Colgrove v. Battin, 413 U.S. 149, 157, 93 S.Ct. 2448, 2453, 37 L.Ed.2d 522 (1973)), the Boyd court further observed:
It is true that the Virginia General Assembly may constitutionally abolish a cause of action, and the attaching right to a jury trial.... It does not follow, however, that the legislature may constrict the right to a jury trial in the common-law actions which are retained. To the contrary, the seventh amendment commands that the right to trial by jury "shall be preserved." The legislature cannot, in the guise of shaping and delineating the cause of action, diminish this right.
Likewise, the Commonwealth may not invoke the purpose of the statute to justify invading the province of the jury.... Though the legislature has broad power to regulate matters affecting public health and welfare, it may not infringe on a party's right to trial by jury in a federal court.
Boyd, 672 F.Supp. at 921.
I believe that the Utah state constitutional right to jury trial on the question of civil damages is absolute. I also believe that the absurdly low amount contained in the recovery limits statutes infringes egregiously on that right. Under the due process balancing analysis set forth in parts III and IV above, I would not hold that any limitation in actions against the government was per se invalid because of the infringement of the right to jury trial. However, in the case of a limitation which is on its face unlikely to cover even the medical expenses of plaintiffs, and in the absence of any evidence from the state justifying such an arbitrary limitation, I would strike the balance in favor of the constitutional guarantee of jury trial rather than the statute.
VII. Conclusion
Only part of the foregoing analysis has been concurred in by Justices Zimmerman and Stewart, as explained in their separate opinions. Accordingly, the holding of the Court is limited to the following: the recovery limits statutes are unconstitutional as applied to University Hospital. The trial court's order is reversed, and this case is remanded for further proceedings consistent with this holding.
. Plaintiffs alleged that sections 63-30-3 and -4 worked to abrogate a common law cause of action for negligence against employees of government-owned health care facilities.
At the time this lawsuit arose, sections 63-30-29 and -34 imposed a $100,000 limit on the amount a person could claim against an uninsured government entity because of injury or death. Section 63-30-29 was repealed in 1983, and a new provision in section 63-30-34 increased the permissible amount to $250,000. Repealed section 63-30-29 and former section 63-30-34 will be collectively referred to as the "recovery limits statutes" since they operated in conjunction to limit recovery. For purposes of this appeal, the $100,000 cap is applicable.
. The original version of the Utah Governmental Immunity Act, effective July 1, 1966, read as follows: "Except as may be otherwise provided in this act, all governmental entities shall be immune from suit for any injury which may result from the activities of said entities wherein said entity is engaged in the exercise and discharge of a governmental function."
. See note 1 supra.
. That provision reads as follows:
All courts shall be open, and every person, for an injury done to him in his person, property or reputation, shall have remedy by due course of law, which shall be administered without denial or unnecessary delay; and no person shall be barred from prosecuting or defending before any tribunal in this State, by himself or counsel, any civil cause to which he is a party.
.Of course, the question of whether the University of Utah Medical Center is performing an essential governmental function has not been decided in this case.
. Justice Stewart's opinion takes the opposite position, but the operation and effect of the equal protection test he describes is identical to the due process analysis this opinion advocates.
. A further inadequacy of the dissent's approach to this problem is its failure to distinguish between state and federal constitutional provisions and analysis. Federal law on this question is neither binding on this Court nor particularly helpful. I note that I join in the concurring portions of Justice Zimmerman's opinion to that effect.
. But see White v. State, 203 Mont. 363, 661 P.2d 1272 (1983), in which the Montana Supreme Court held that the state constitutional right to remedy for injuries was fundamental and required the application of strict scrutiny to a governmental immunity statute.
. By contrast, the fault requirement was eliminated in Utah's Workers' Compensation Act, Utah Code Ann. § 35-1-107 (1988), and the Utah No-Fault Automobile Insurance Act, Utah Code Ann. § 31A-22-309 (1986).
. The following commentary describes what is meant by crisis rationale in this context:
The medical malpractice crisis is neither a unique nor an isolated phenomenon; rather, it is one of the series of crisis-legislation sequences which threaten to erode the established system of tort law. The most contemporary of these crises concerns municipal liability and the uninsurability of municipal corporations.
As with the medical malpractice crisis, those affected by the current dilemma in municipal liability have identified the tort system as the root of the problem. A two-fold premise associated with these crises is that the fault lies in the tort system, and that limitations on the rights of victims are necessary in order to alleviate the problem. Without more, acceptance of this premise requires a leap of faith because the means-end connection is essentially unsupported. The premise fails because it is neither guaranteed nor likely that limiting the rights of victims will produce the benefits envisioned by the legislatures. Moreover, the premise is based on the erroneous assumption that the exercise of victims' rights is the exclusive cause of the liability insurance crisis.
Crisis legislation is neither a new nor a necessarily undesirable feature of the American legal and political process. In fact, it may very well demonstrate legislative ability to act quickly and decisively in the face of serious social, economic, or political problems. There are, however, serious and legitimate concerns over the use and the potential abuse of such drastic measures.
Note, Target Defendants and Tort Law Reform: A Perspective on Medical Malpractice and. Municipal Liability, 11 Vt.L.Rev. 535, at 537, 542 (footnotes omitted); see also Nader, The Assault on Injured Victims' Rights, 64 Den.U.L.Rev. 625 (1988).
. Even this comment, however, acknowledges the necessity for a "residuum" of immunity "to satisfy the countervailing interests of the separation of powers, deterrence of harm, and victim compensation" that is "composed of true policy decisions, both necessary to govern and without private counterparts." Murray & Murray, at 121.
. See Eikenberry, Governmental Tort Litigation and the Balance of Power, 45 Pub.Admin.Rev. 742, 743 (1985) ("Something is fundamentally wrong with the idea that a tort action for damages is an appropriate way of setting or establishing governmental policy.").