In 2004, Mississippi passed a piece of legislation that was the “centerpiece” of its tort reform. The law created a $1 million cap on non-economic damages awarded to plaintiffs in civil litigation, including in personal injury cases ($500,000 for medical malpractice actions). The cap was put in place, supposedly, for two general reasons. First, it would repair Mississippi’s reputation as anti-defendant. And, second, it would allow liability insurance providers to curb the increasing price of premiums.
Subsequently, Lisa Learmonth was involved in a car accident with a Sears van. Pursuing compensation in court, a jury awarded $4 million to Ms. Learmonth, which was reduced in accordance with the cap.
Her attorneys, however, appealed the reduction.
They argued that the cap itself was unconstitutional under the Mississippi state constitution. The provision in question related to so-called ‘separation of powers.’ Ms. Learmonth’s attorneys asserted that forcing judges and juries to adhere to the legislation, enacted by a separate branch of government, infringed on the judiciary.
After this case meandered back to the Mississippi state courts, and then back again to the federal courts, the United States Court of Appeals for the Fifth Circuit finally decided the issue this week.
The Fifth Circuit rejected the lawyers’ arguments, holding that the state constitution permitted the cap.
In New Jersey, there is no cap on non-economic damages. And this is so in a number of other states, including Arizona, New York, and Pennsylvania. Some states had such laws, like Florida, Georgia, and Missouri, but they were struck down as unconstitutional. While dozens of other states either have not had their cap laws challenged or have them challenged and upheld, like in Mississippi.
Clearly, this issue is controversial, and often debated. And now, the Fifth Circuit weighing in on the matter – even in the context of Mississippi state law – could have farther-reaching ramifications on the legal debate.
For an article on the Fifth Circuit’s decision, see: http://msbusiness.com/magnoliamarketplace/2013/02/27/federal-appeals-court-rules-states-tort-cap-does-not-violate-separation-of-powers/.
And for a breakdown of damage caps, state-by-state (including New Jersey), see: http://blogs.lawyers.com/2012/11/damage-caps/.
