Opinion ID: 2398709
Heading Depth: 1
Heading Rank: 4

Heading: reasonable alternative

Text: The question as to whether the legislatively created remedy is a reasonable alternative is best decided by viewing in the aggregate the remedies which the act provides. The question of no-fault automobile insurance has been studied on federal and state, private and public levels for several years and, without abrogating our judicial function, it seems appropriate to discuss at least some of the policy arguments that precipitated the passage of the act. Enactment of the Connecticut no-fault insurance act resulted from the historical confluence of popular disaffection with the inadequacies of the automobile accident compensation system based on fault, the availability of empirical data from systematic studies of alternative automobile accident reparations systems, and the willingness of the legislature to respond to the popular will. Public awareness of the deficiencies and inequities of the tort liability system for the compensation of victims of motor vehicle accidents was heightened and encouraged by the publication in 1965 of a study entitled Basic Protection for the Traffic Victim by Professors Robert E. Keeton and Jeffrey O'Connell. This detailed work identified weaknesses and inefficiencies inherent in an automobile reparations system based on fault. In May, 1968, the Congress of the United States in Public Law 90-313 directed the secretary of transportation of the United States to investigate the motor vehicle accident compensation system and to report to the Congress his findings, conclusions and recommendations for legislation. Pursuant to this congressional mandate, the secretary of transportation and his successor conducted an exhaustive study, using resources of the department and numerous nongovernmental experts retained to contribute to the study. The ultimate findings of the department of transportation study, hereinafter DOT study, were that the states should strive toward: a system of no-fault insurance (1) based on universal compulsory first party insurance coverage serviced by private insurance companies and providing protection for all motor vehicle owners by covering all economic losses above voluntarily accepted deductibles up to reasonably high limits; (2) coupled with restrictions on the availability of resort to litigation by motor vehicle accident victims for economic losses or for intangible losses except in truly serious cases. DOT study, supra. Contemporaneously with the publication of the DOT study, the need to investigate the inadequacy of the existing system for compensation of automobile accident victims in Connecticut led to the enactment of 1971 Special Act No. 143 to establish a committee to undertake a comprehensive study and make recommendations for legislation. The study commission was charged to study and make suggestions regarding automobile accidents, including their prevention and consequences, and related insurance, motor vehicle and procedural laws bearing thereon, and to determine whether such laws, together with the statutory rules of the road, most effectively contribute to the prevention of automobile accidents and the expeditious and adequate financial recourse of automobile accident victims. This commission, after an exhaustive study, recommended that the legislature adopt an evolutionary approach to improving Connecticut's present tort liability system to the end that a greater number of injured persons will receive payment for their injuries and damages by mandatory first party payments to be made without regard to fault. The commission further suggested that suits for pain and suffering be abolished except in circumstances involving death, serious injury as defined by the commission report, or economic loss above a threshold. Substitution of the first party benefits for the tort remedy was necessary to pay for the additional first party coverages recommended and to obtain the dollar premium savings which the public expected. Upon receipt of the study commission's report, the General Assembly in 1972 began consideration of a no-fault insurance bill. Substitute House Bill No. 5479 entitled An Act Concerning No-Fault Motor Vehicle Insurance was the subject of thorough and extensive hearings before the joint judiciary and insurance and real estate committee of the General Assembly in April of 1972. The joint committee also received a detailed cost-benefits analysis of no-fault insurance from a consumer viewpoint estimating the likely savings in insurance premiums to be obtained through the use of a no-fault insurance system, prepared at the request of the study commission and joint committee by Neill W. Portermain, an actuarial consultant. Portermain analyzed the effect of the legislature's modification of the threshold from $750 in total economic loss recommended by the commission to the $400 in medical expenses ultimately incorporated into the act. This modification necessitated a total recosting of the plan by Portermain; and his April 3, 1972 testimony before the joint committee was thus a further clarification and refinement of the study which he had previously conducted. His conclusion was that the grading of the threshold to $400 in medical expenses would produce a cost analysis very close to the one which he had originally conducted based on a $750 total economic loss threshold. It is readily apparent that the study commission and the joint committee were concerned with guaranteeing the prompt payment of benefits to injured parties while at the same time achieving a reduction in insurance premiums and an increase in efficiency in the reparations system. The General Assembly, after lengthy debate concerning all the materials and studies hereinbefore discussed and the policy considerations concerning and surrounding no-fault legislation, passed Substitute House Bill No. 5479 on April 18, 1972. The act was signed and approved by the governor on May 19, 1972. Even a brief perusal of the thirty-six sections of the act demonstrates clearly that it is a legitimate legislative response to the specific causes of public discontent and disaffection with the motor vehicle accident compensation system based on fault. Sections 38-32038-322 provide first party compensation, enabling an injured party to obtain prompt recompense for his most serious financial needs without bearing the expense and lengthy delay associated with litigation to establish fault. Furthermore, the benefits provided by this first party coverage are disbursed immediately following the accrual of the loss. Section 38-337 appears to be a specific response to the findings of the department of transportation study on the rehabilitation of automobile accident victims. DOT study, Rehabilitation of Auto Accident Victims. The basic reparations insurer is responsible for the cost of a procedure or treatment of rehabilitation when the program of rehabilitation is reasonable, its cost is reasonable, and there is a reasonable likelihood that the program will contribute to rehabilitation, even if it will not enhance the injured person's earning capacity. Section 38-323 is an attempt to cure several defects in the fault compensation system as noted by the department of transportation and the study commission. The fault system's reliance on litigation in minor claims caused administrative inefficiencies which resulted in payment of only forty-four cents of every dollar of premiums as benefits to insured victims, and caused overcompensation of small claims below $500 as well as extreme pressure on court dockets. No cause of action for economic loss or noneconomic detriment based on negligence may be maintained under the act unless the injured person has satisfied the exceptive criteria of § 38-323. Sections 38-34138-349 are regulatory measures which provide that the insurance commissioner shall supervise the insurance industry to the end that insurers provide coverage under the act at reasonable rates and that all persons are able to obtain such coverage either through the normal insurance market or through the assigned risk plan. Finally, § 38-351 demonstrates the legislature's awareness of the popular belief that insurance rates were unnecessarily high as a result of the fault system and mandated a reduction in rates of 10 percent, thus passing directly to the consumer the benefits of increased administrative efficiency provided by the no-fault system. Since, however, it is within the power of the legislature to create reasonable alternative remedies, our review of the act's relation to article first, §10, is limited to the issue of reasonableness and not to whether such an alternative is necessary in the first instance. Opponents of no-fault insurance focus their arguments upon the act's effect on the nonexempted plaintiff (that is, the plaintiff who fails to satisfy any of the exceptive criteria of § 38-323 and thus must accept only the basic reparations offered under the act) and question the substitution of the act's remedies as to this plaintiff, as an alternative to the prior unrestricted tort cause of action. What is given in return for the disallowance of this cause of action, however, is immediate payment of reasonable medical expenses and economic loss. In comparison, the nonexempted plaintiff forgoes damages for mental anguish, physical impairment, and pain and suffering. The act thus restricts the extent of recovery to injuries of greater magnitude where attendant pain and suffering, in the determination of the legislature in the great majority of cases, will be extensive. Thus the act is a legislative realization that minor injury cases (nonexempted plaintiffs) involve little in the way of noneconomic detriment and that the injured party is better compensated by immediate payment of the act's defined first party benefits. Standing alone, the nonexempted plaintiff's alternate remedies may not equate with the foregoing tort remedies. It must be recognized, however, that the law requires a reasonable alternative and not an exact equation of remedies. Thus for each remedy or item of damage existing under the prior fault system, it is not required that that item be duplicated under the act but that the bulk of remedies under the act be of such significance that a court is justified in viewing this legislation on the whole as a substitute, the benefits from which are sufficient to tolerate the removal of the prior cause of action. Having thus viewed the act, we are not limited to a consideration merely of its effect upon the nonexempted plaintiff. When one enters upon the highway he or she is, at the same time, a potential plaintiff and a potential defendant. Pinnick v. Cleary, 360 Mass. 1, 22, 271 N.E.2d 592. We must then add to the benefits accorded the nonexempted plaintiff the immunity granted by the act to his defendant-counterpart. Therefore, while limiting recovery for the nonexempted plaintiff, the act further assures each insured that when he is placed in the role of tortfeasor he is granted immunity from suit to the extent that his victim is in the nonexempted category. Added to this is the reduced premium for such first party coverage because of the compulsory nature of the act. It is this aggregate of benefits to the insured that clearly falls within the ambit of reasonable alternative. By similar reasoning the Supreme Judicial Court of Massachusetts sustained its no-fault act. Pinnick v. Cleary, supra. Comparing the effect of the act's remedies to the prior tort system, employing as an analogue the rationale and analysis of New York Central R. Co. v. White, 243 U.S. 188, 37 S. Ct. 247, 61 L. Ed. 667, which sustained New York's Workmen's Compensation Act as a reasonable substitute for prior common-law tort remedies abrogated by the act, the Massachusetts court stated (p. 23): The effect of ... [the no-fault act] on Massachusetts motorists thus is to provide benefits in return for affected rights at least as adequate as those provided to New York employers and employees in return for rights taken by the act in the White case.