Opinion ID: 1905888
Heading Depth: 2
Heading Rank: 6

Heading: limitation on recovery violates equal protection

Text: We come now to the constitutionality of the maximum figure of $300,000 arising from any one occurrence. It is common knowledge that some severely injured persons have normal life expectancies. Some of them require care around the clock. It seems obvious that the total expense of caring for a young person in a coma, or a quadriplegic, during a normal life expectancy might well exceed $300,000. In the face of such facts, we must examine the stated basis for the imposition on the limitation of recovery to $300,000. Preliminarily, we note that no State court of last resort has upheld a limitation so low. Nebraska upheld a $500,000 limitation, but Illinois held that a $500,000 limitation was unconstitutional as arbitrary and as a special law [347 N.E.2d pages 742-743]. In Idaho a limitation on recoverable damages for actions against physicians of $150,000 per claim and $300,000 per occurrence is specified. However, the Idaho court remanded the case for further factual basis for a determination as to whether the means adopted were reasonably related to the solution of the problems asserted by the Legislature. In Wisconsin there appears to be no limit presently for recovery, but only a limit of $500,000 of payments per year if the award is over $1,000,000. The Wisconsin statute provides that after July 1, 1979, there shall be a limit of recovery of $500,000 over and above medical expenses, and only if the State fund falls below a certain level. Yet the Wisconsin Supreme Court held that it would be judicially inappropriate to decide in 1977 whether the provision effective in 1979 was constitutional. In Kansas there apparently is no limit of recovery. We proceed to a determination of whether the legislative limitation of recovery is arbitrary and unreasonable and violative of due process, or whether there is a sufficiently close correspondence between statutory classification and legislative goals so as not to violate the equal-protection requirements of the State and Federal Constitutions. [6] At the beginning of this opinion we quoted the preamble of the statute, containing its legislative purposes. These include assurance of availability of competent medical and hospital services at reasonable cost, elimination of the expense involved in nonmeritorious malpractice claims, provision of adequate compensation to patients with meritorious claims, and the encouragement of physicians to enter into practice in North Dakota and remain in such practice so long as they are qualified to do so. Does the limitation of recovery of seriously damaged or injured victims of medical negligence promote these aims? We hold that it does not and that it violates the Equal Protection Clause of the State Constitution. Certainly the limitation of recovery does not provide adequate compensation to patients with meritorious claims; on the contrary, it does just the opposite for the most seriously injured claimants. It does nothing toward the elimination of nonmeritorious claims. Restrictions on recovery may encourage physicians to enter into practice and remain in practice, but do so only at the expense of claimants with meritorious claims. We agree with the Illinois court where it says: . . . Furthermore, the very seriously injured malpractice victim, because of the recovery limitation, might be unable to recover even all the medical expenses he might incur, in which event he would recover nothing for any other loss suffered. Defendants argue that there is a societal quid pro quo in that the loss of recovery potential to some malpractice victims is offset by `lower insurance premiums and lower medical care costs for all recipients of medical care.' This quid pro quo does not extend to the seriously injured medical malpractice victim and does not serve to bring the limited recovery provision within the rationale of the cases upholding the constitutionality of the Workmen's Compensation Act. [347 N.E.2d page 742] . . . . . . . . We are of the opinion that limiting recovery only in medical malpractice actions to $500,000 is arbitrary and constitutes a special law in violation of section 13 of article IV of the 1970 Constitution, and we so hold. 347 N.E.2d at 743. When we examine the legislative purpose of the Act, we find that the incidence of malpractice claims in North Dakota is far lower than the average in the United States. The Legislature was advised that malpractice insurance rates were determined on a national basis, and did not take into account the state-wide experience of smaller States such as North Dakota. Thus premiums were unjustifiably high for States such as North Dakota with fewer claims and smaller settlements and judgments. The evidence in the case before us, however, indicates that either the Legislature was misinformed or subsequent events have changed the situation substantially. Evidence in the present case shows that one of the largest insurance companies is accepting applications for malpractice insurance in North Dakota, and using rates lower than the national averages. One comparison of rates given to the Legislature shows that premiums in North Dakota are the sixth lowest in the United States. Based upon these facts, and others of the same import, the trial court made a finding that there did not appear to be an availability or cost crisis in this State. We cannot say that this finding is clearly erroneous, based upon the evidence in this case. In the absence of such a finding of crisis, and in view of the drastic limitation on recovery, we conclude that the $300,000 limitation on recovery in malpractice cases is a violation of the equal-protection provision of the North Dakota Constitution, Section 20. It is likewise violative of the similar provision of the Fourteenth Amendment to the United States Constitution.