Opinion ID: 883232
Heading Depth: 1
Heading Rank: 2

Heading: ISSUE II: Constitutional Issues.

Text: Is Montana's comparative negligence statute, § 27-1-703, MCA, unconstitutional as amended by the 1987 legislature? The plaintiffs contend that § 27-1-703, MCA, violates the constitutional guarantees of procedural and substantive due process and equal protection and thus a new trial is required in this case. As discussed below, the Court concludes that § 27-1-703(4), MCA, violates substantive due process. As a result, the Court declines to address the other constitutional issues. This case represents constitutional challenges to major changes in § 27-1-703, MCA, which were enacted by the 1987 Montana Legislature. Section 27-1-703, MCA, was a major vehicle for tort reform enacted by the Montana Legislature in response to demands from numerous factions in this state. That section concerns the determination of liability when there are multiple defendants involved in an action based upon negligence. Section 27-1-703, MCA (1987), as amended by the 1987 legislature, is set forth in its entirety in the appendix to this opinion, as is its predecessor, § 27-1-703, MCA (1985). The 1987 Senate Judiciary Committee minutes indicate that Senate Bill 51 (SB 51), which amended § 27-1-703, MCA, was patterned after a bill in Washington state. That bill was drafted as an attempt to change Washington's comparative negligence statute and was intended to match liability for damages to fault of each of the parties involved in a tort action, excepting only the fault of employers and co-employees to the extent of their tort immunity under the Workers' Compensation Act. The stated aim of SB 51 was to protect deep pocket defendants such as municipal and county governments when they were faced with minimal percentages of negligence assigned to them by juries but nonetheless required to pay large judgments under joint and several liability principles. As pointed out by Victor E. Schwartz in his comparative negligence treatise, a substantial minority of states have now abolished or severely limited the common law doctrine of joint and several liability: In the mid-1980's, a significant number of states changed the joint liability rule, in part, because of growing awards against deep pocket defendants who might be only peripherally responsible for plaintiff's injuries. A few states cut the Gordian knot by abolishing the doctrine outright or limiting it to those who have acted in concert. Nevada abolished it except in cases involving strict liability, intentional torts, toxic wastes, concerted acts, or products liability. A number of other states have attempted to serve competing goals of fairness and loss distribution by adopting systems for imposing joint liability only for noneconomic damages or for certain percentages of fault. Some states have adopted a combination of exceptions. V. Schwartz, Comparative Negligence § 16.4 (2d ed. Supp.1993). The major changes in § 27-1-703, MCA (1987), related to joint and several liability and the addition of subsection (4) mandating the trier of fact to consider the negligence of various described persons and parties in order to determine liability and apportion the percentage of liability among all such persons. Section 27-1-703(4), MCA (1987), provides in pertinent part: (4) ... For purposes of determining the percentage of liability attributable to each party whose action contributed to the injury complained of, the trier of fact shall consider the negligence of the claimant, injured person, defendants, third-party defendants, persons released from liability by the claimant, persons immune from liability to the claimant, and any other persons who have a defense against the claimant. The trier of fact shall apportion the percentage of negligence of all such persons... The above-quoted subsection (4) is new and takes the place of the following from the prior statute: Whenever more than one person is found to have contributed as a proximate cause to the injury complained of, the trier of fact shall apportion the degree of fault among such persons. The theory underlying substantive due process reaffirms the fundamental concept that the due process clause contains a substantive component which bars arbitrary governmental actions regardless of the procedures used to implement them, and serves as a check on oppressive governmental action. Even though a plaintiff may have no property or liberty interest grounded in state law which is protected from arbitrary government action, such action still may be subject to review under substantive due process. Substantive due process primarily examines the underlying substantive rights and remedies to determine whether restrictions, such as those placed on both remedies and procedures in this case, are unreasonable or arbitrary when balanced against the purpose of the legislature in enacting the statute. See J. McGuinness and L. Parlagreco, The Reemergence of Substantive Due Process As A Constitutional Tort: Theory, Proof, and Damages, 24 New Eng. 1129, 1133 (1990). Substantive review for due process violations applies to enactments which affect individual constitutional rights, and may thus include a review of an enactment's inherent procedural fairness. Rotunda & Nowak, 2 Treatise on Constitutional Law: Substance and Procedure § 15.4 (2d ed. 1992). In addressing a substantive due process challenge in Harrison v. Chance (1990), 244 Mont. 215, 225, 797 P.2d 200, 206, we referred to our analysis in Linder v. Smith (1981), 193 Mont. 20, 28-29, 629 P.2d 1187, 1192, stating: The legislature is free to impose reasonable procedural requirements on the available remedies so long as those requirements have a rational basis. Although the Linder Court held there was no substantive due process violation on the basis of the issues as raised by the parties, it did excise a portion of the statute on substantive due process grounds, stating: We find claimant's due process contentions to be without merit, particularly when considered in view of the limited effect which the panel's decision can have in Montana in subsequent litigation. We do address one issue, though, which was not initially raised by the parties to the litigation, but which came to our attention during the hearing in this case. Section 27-6-704(2), MCA, provides that [no] statement made by any person during a hearing before the panel may be used as impeaching evidence in court. In order to uphold the constitutionality of the panel act, we determine that this section must be severed from the act. It is fundamental to our adversarial system that litigants retain the right to impeach the sworn testimony of a witness testifying against them. We are mindful that this provision was enacted to aid the fact-finding by the panel and to preserve the confidentiality of the proceedings. But we cannot say that a litigant will receive a full and fair hearing if he is unable to fully cross-examine in court the witnesses that testified in the prior hearing. Linder, 629 P.2d 1192. In Raisler v. Burlington N. Ry. Co. (1985), 219 Mont. 254, 263, 717 P.2d 535, 541, this Court stated, Substantive due process analysis requires a test of the reasonableness of a statute in relation to the State's power to enact legislation. Its essence is that the State cannot use its power to take unreasonable, arbitrary or capricious action against an individual. Raisler, 717 P.2d at 541. Therefore, in order to satisfy guarantees of substantive due process, a statute enacted by the legislature must be reasonably related to a permissible legislative objective. Raisler, 717 P.2d at 541. See also Ball v. Gee (1990), 243 Mont. 406, 412, 795 P.2d 82, 86, citing In re C.H. (1984), 210 Mont. 184, 194, 683 P.2d 931, 936. In Montana Milk Control Bd. v. Rehberg (1962), 141 Mont. 149, 158-59, 376 P.2d 508, 514, this Court determined that substantive due process was not violated by legislation which allowed the State to control the retail price of milk and determined that the legislation was reasonably related to the permissible legislative purpose of ensuring an adequate supply of wholesome milk to the citizens of Montana. More recently, in In the Matter of the Adjudication of the Yellowstone River (1992), 253 Mont. 167, 179, 832 P.2d 1210, 1217, we stated that the State's regulatory power over adjudicating water rights must be exercised consistent with principles of substantive due process: A statute must be reasonably related to a permissible legislative objective to satisfy substantive due process guarantees.... The 1972 Montana Constitution mandates that the legislature establish a system of centralized records. There can be no doubt that § 85-2-226, MCA, was enacted for a permissible legislative objective. However, the appellants challenge whether ... § 85-2-226, MCA, is reasonably related to the objective of adjudicating water rights. It is contended that ... [Section] 85-2-226, MCA, ... fails to be reasonably related to these objectives, because its operation results in the elimination of existing water rights. (Citations omitted.) In Matter of Yellowstone River, 832 P.2d at 1217, we ruled that the challenged statute did not violate substantive due process in that it was a reasonable means of compelling comprehensive participation, extinguishing duplicative and exaggerated rights, and ridding local records of stale, unused water claims. The statute's filing requirement was neither burdensome, unreasonable nor unrelated to the legitimate and proper legislative objectives. Matter of Yellowstone River, 832 P.2d at 1217. We further noted that neither the Supreme Court nor other states addressing the constitutionality of statutes requiring filing had found the filing requirement to be more than a minimal burden. Matter of Yellowstone River, 832 P.2d at 1217. Although most of the challenges brought to this Court which have been grounded in substantive due process have failed, we have ruled that substantive due process was violated by a restrictive covenant in Town & Country Estates Ass'n v. Slater (1987), 227 Mont. 489, 493, 740 P.2d 668, 671. The restrictive covenant which violated substantive due process in Town & Country Estates allowed a Design Review Committee to disapprove house plans and prevent construction of homes in the subdivision. We held that the covenant was vague to a degree that violated substantive due process and was enforceable only when used in connection with some general plan or scheme. Town & Country Estates, 740 P.2d at 671. In Town & Country Estates, the houses already built in the subdivision were each unique in design and demonstrated a cacophony of styles with a hybrid mix of traditional, Tudor, ranch, and contemporary with the only common design characteristics being a 2400 square foot size minimum and a shake roof. Town & Country Estates, 740 P.2d at 671. The Court stated: If the subdivision itself lacks consonance, the Slaters' plan cannot lack harmony. In the context of [Town and Country Estates] and Slaters' plan, the term harmony of external design lacks the mutuality of obligation central to the purpose of a restrictive covenant. In view of the wide variety of designs, no one seemed burdened by the covenant except the Slaters. . . . . . The approval or disapproval of plans by the [Design Review Committee] must be based upon an objective design standard. Without a quantifiable standard to guide them, the decision ... is unenforceable.... We hold that the Slaters' house fell well within the broad architectural spectrum of [Town & Country Estates] houses. Applied to the ... subdivision and the Slaters' plan, we hold that Article V lacks sufficient objectivity, and is vague to a degree that denies substantive due process to the Slaters. Town & Country Estates, 740 P.2d at 671. (Emphasis supplied.) In the case before us, plaintiffs contend that § 27-1-703, MCA (1987), arbitrarily prejudices plaintiffs by requiring them to exonerate nonparties. They contend there is no reasonable basis to require any plaintiff to prepare a defense at the last minute for nonparties whom defendants seek to blame for the injury, but who have not been joined as defendants; and that there is no reasonable basis for requiring plaintiffs to examine jury instructions, marshal evidence, make objections, argue the case, and examine witnesses from the standpoint of unrepresented parties, particularly when they do not know until the latter part of the trial that defendants will seek to place blame on unrepresented persons. These procedural problems form the bases for our holding that § 27-1-703, MCA (1987), in part violates substantive due process. We conclude that § 27-1-703(4), MCA (1987), unreasonably mandates an allocation of percentages of negligence to nonparties without any kind of procedural safeguard. As a result, plaintiffs may not receive a fair adjudication of the merits of their claims. It imposes a burden upon plaintiffs to anticipate defendants' attempts to apportion blame up to the time of submission of the verdict form to the jury. Such an apportionment is clearly unreasonable as to plaintiffs, and can also unreasonably affect defendants and nonparties. We note that other states have enacted tort legislation allowing the inclusion of nonparties. Colorado, as an example, allows the inclusion of nonparties when apportioning fault, but only when notice has been given by the defendant within 90 days of commencement of the action. See Colo. Rev. Stat. § 13-21-111.5 (1987). Indiana requires a defendant to assert a nonparty defense and to bear the burden of proof of that defense if the defense is asserted as part of an answer filed more than 45 days prior to the running of the statute of limitations on a claim against a nonparty. See Ind. Code § 34-4-33-10 (1985). Like Indiana, Kansas places the burden of bringing in other parties, including those who have settled, on the defendant. Glenn v. Fleming (1987), 240 Kan. 724, 732 P.2d 750, 756. Although Kansas has abolished joint and several liability altogether, it does not allow apportionment of percentage of total damages to any person who is not a party. See Kan. Stat. Ann. § 60-258a(d) (1977). The establishment of the nonparty defense in Indiana has brought many questions about the definition of nonparty and the procedural mechanisms for bringing in additional defendants. Schwartz, Comparative Negligence § 16.5 (2d ed. 1986 & Supp. 1993). Numerous other comparative negligence statutes  although rarely similar to an act of another state  include some type of procedural safeguard for plaintiffs, defendants and nonparties. Ohio's tort reform law, for example, limits allocation of negligence to parties before the court. Schwartz, Comparative Negligence § 16.5 (2d ed. Supp. 1993); Ohio Rev. Code Ann. § 2315.19(B)(4) (1991). New Mexico allows settling defendants to be called as witnesses and allows discovery regarding such witnesses as if they remained in the action. Wilson v. Gillis (App.1986), 105 N.M. 259, 731 P.2d 955, 958. We have noted some of the procedural safeguards provided by other jurisdictions to emphasize that Montana's statute provides none of these protections. Our review of the comparative negligence statutes from other jurisdictions does not provide much help in the present case, however. Nearly every state has a unique statute with nuances which make its case law interpreting the statutes of little help to other courts. We have previously mentioned that SB 51 was patterned after Washington state's statute. Yet SB 51 is substantially different from the 1986 enactment of Wash. Rev. Code Ann. 4.22.070, which is also set forth in the appendix to this opinion. A striking difference is that the Washington statute preserved joint and several liability for innocent plaintiffs. In contrast, § 27-1-703, MCA (1987), treats all plaintiffs alike, lumping totally innocent plaintiffs  like R.M. in this case  with those plaintiffs whose comparative negligence may be as much as 50 percent. The effect of § 27-1-703, MCA (1987), is to diminish plaintiffs' ability to collect 100 percent of damages in situations like the present case. Where the trier of fact attributes less than 51 percent of the negligence to each person on the verdict form, plaintiffs may be unable to collect for the portion of negligence attributable to judgment-proof defendants, immune tortfeasors, or other persons who may be included on the verdict form but who have not been a part of the action. Such was the case with the persons listed on the special verdict form in the present case. Edna Goodwin was an unrepresented nonparty on the basis of her settlement prior to trial. Although Goodwin settled prior to trial and was no longer a party, she nonetheless was included on the verdict form as a settling party pursuant to § 27-1-703(4), MCA. No attorney represented Goodwin's interests at trial and as a result, it is possible that the application of percentage of negligence was higher than would have been appropriate had the facts as to her case been presented by her own counsel. None of the parties introduced evidence relating to the standard of care of a professional counselor. Goodwin was included on the verdict form as required by § 27-1-703(4), MCA, without any instruction to the jury as to the proper standard of care for a professional counselor. On the verdict form the jury allocated 35 percent of the negligence to Ms. Goodwin, 35 percent to Mrs. Kuipers and 30 percent to the Department. Section 27-1-703(5), MCA, provides that if a party is found to be less than 50 percent negligent, that party is liable for contribution only up to the percentage of negligence attributed to him. As a result, under the verdict given, if any party is unable to pay the full amount of the judgment against that party, there will then be an inability on the part of the plaintiffs to collect all damages. See State ex rel. Deere & Co. v. District Court (1986), 224 Mont. 384, 730 P.2d 396, for its treatment of joint and several liability prior to the 1991 enactment of § 27-1-703(5), MCA. In many jurisdictions  some mentioned above  comparative negligence statutes allow an apportionment of liability to immune parties and settling parties. However, these jurisdictions have procedural aspects which provide for notice to plaintiffs, specific burdens of proof, and other procedures for safeguarding the rights of all involved  parties and nonparties alike. Consideration of these procedural protections should have been considered by the Montana Legislature at the time of the enactment of the statute. While the listed reasons for enactment of comparative negligence tort reform legislation are valid governmental purposes, we conclude that the Montana Legislature has acted arbitrarily and unreasonably in responding to this need. We conclude that the allocation of percentages of liability to nonparties violates substantive due process as to the plaintiffs. We hold that the following portion of § 27-1-703(4), MCA (1987), violates substantive due process: ... persons released from liability by the claimant, persons immune from liability to the claimant, and any other persons who have a defense against the claimant.... While we hold that the naming of any other persons who have a defense against the claimant violates substantive due process where such persons are not parties, we further emphasize that the reference in the statute to any other persons who have a defense against the claimant is so vague as to make its meaning impossible to understand. This raises the question as to whether the above holding renders the entire statute unconstitutional. In the enactment of SB 51, the 1987 Montana Legislature included the following severability clause: Section 3. Severability. If a part of this act is invalid, all valid parts that are severable from the invalid part remain in effect. If a part of this act is invalid in one or more of its applications, the part remains in effect in all valid applications that are severable from the invalid applications. Chapter 505, 1987 Mont. Laws 1232, 1233. As pointed out in Montana Auto. Ass'n v. Greeley (1981), 193 Mont. 378, 399, 632 P.2d 300, 311, if the invalid part of a statute is severable from the rest, the portion which is constitutional may stand while the part which is unconstitutional is stricken and rejected. That case further emphasized that a statute is not totally destroyed because of an improper provision, unless such provision is necessary to the integrity of the statute, or was an inducement to its enactment. When an unconstitutional portion of the act is eliminated, if the remainder is complete in itself and capable of being executed in accordance with apparent legislative intent, it must be sustained. Montana Auto. Ass'n, 632 P.2d at 311. We here conclude that the unconstitutional portion of § 27-1-703(4), MCA (1987), is not essential to the integrity of the statute, nor was it an inducement to its enactment. We further conclude that the remainder of the statute is capable of being executed in accordance with the legislative intent. As a result of our holding of unconstitutionality, we have eliminated that portion of the statute which allowed an allocation of negligence to nonparties, and in particular to nonparties who had been released from liability by the claimant, nonparties who were immune from liability to the claimant, and any other nonparties who have a defense against the claimants. Therefore, in accord with our holding, the lined through portion of § 27-1-703(4), MCA (1987), as illustrated below is hereby excised from the statute as unconstitutional: 27-1-703. Multiple defendants  determination of liability. ... (4) On motion of any party against whom a claim is asserted for negligence resulting in death or injury to person or property, any other person whose negligence may have contributed as a proximate cause to the injury complained of may be joined as an additional party to the action. For purposes of determining the percentage of liability attributable to each party whose action contributed to the injury complained of, the trier of fact shall consider the negligence of the claimant, injured person, defendants, [and] third-party defendants, persons released from liability by the claimant, persons immune from liability to the claimant, and any other persons who have a defense against the claimant. The trier of fact shall apportion the percentage of negligence of all such persons. However, in attributing negligence among persons, the trier of fact may not consider or determine any amount of negligence on the part of any injured person's employer or coemployee to the extent that such employer or coemployee has tort immunity under the Workers' Compensation Act or the Occupational Disease Act of this state, of any other state, or of the federal government. Contribution shall be proportional to the liability of the parties against whom recovery is allowed. Nothing contained in this section shall make any party indispensable pursuant to Rule 19, Montana Rules of Civil Procedure.