Products Liability Law Daily Noneconomic damages cap inapplicable to jury awards in defective product suit
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Friday, January 5, 2018

Noneconomic damages cap inapplicable to jury awards in defective product suit

By Georgia D. Koutouzos, J.D.

Reducing the noneconomic damages awarded to a construction worker and his wife in a product liability lawsuit arising from the worker’s severe injury due to a defective wooden board violated the Oregon Constitution’s remedy clause, an appellate panel in that state determined on remand from the state’s highest court. In so ruling, the appeals court determined that the state’s $500,000 statutory cap on noneconomic damages was unconstitutional when applied to the couple’s noneconomic damages awards because the reductions would leave them without a "substantial" remedy (Rains v. Stayton Builders Mart, Inc., January 4, 2018, Ortega, D.).

While constructing a barn, a worker fell almost 16 feet to the ground and was rendered a paraplegic when a defective wood board on which he had been standing broke at his job site. The injured man brought a strict products liability claim against the retailer, Stayton Builders Mart, as well as the manufacturer of the defective board, Weyerhaeuser Co. In addition, his wife brought loss-of-consortium claim against those same defendants.

The case was tried to a jury, which ultimately determined that the injured man had suffered $5,237,700 in economic damages and $3,125,000 in noneconomic damages, and that his spouse had suffered $1,012,500 in noneconomic damages. The jury also found that Weyerhaeuser was 45 percent at fault, Stayton was 30 percent at fault, and the worker was 25 percent at fault for his injuries. After trial, Weyerhaeuser moved to reduce each of plaintiffs’ noneconomic damages awards to $500,000 based on Oregon’s statutory cap on noneconomic damages, but the trial court denied the motion on the basis that the state constitution precluded the statute from limiting noneconomic damages on plaintiffs’ claims. Accordingly, after accounting for the comparative fault, the trial court entered a limited judgment awarding $6,272,025 to the injured man and $759,375 to his wife against Weyerhaeuser and Stayton.

Weyerhaeuser appealed the limited judgment, asserting that the trial court erred by not reducing the couple’s noneconomic damages awards to the statutorily mandated $500,000 cap. A state appellate court rendered an initial decision concluding that the trial court erred in not applying the cap on noneconomic damages [see Products Liability Daily’s August 14, 2014 analysis], but that decision was reversed and remanded in part by the Oregon Supreme Court, which vacated the panel’s findings with respect to the parties’ assignments of error concerning the damages cap.

Meanwhile, in a different decision handed down while the appeal of the case at bar was pending before the state supreme court, the high court concluded that Oregon’s constitution does not independently restrict the legislature’s ability to impose a statutory damages cap on specific claims. In doing so, the supreme court negated the historical analysis that the appellate panel had undertaken in its determination regarding whether the constitution precluded application of the statutory limitation on noneconomic damages to the awards received by the injured construction worker and his wife.

Arguments on remand. In their supplemental briefing on remand, the couple asked the appeals court to affirm the trial court’s limited judgment in their favor because, under the state high court’s intervening precedent, the application of the statutory provision in the case at bar violated the state constitution’s remedy clause because it would leave them without a substantial remedy.

Weyerhaeuser countered that the couple’s challenge to the statutory provision under the remedy clause was precluded because they had raised it for the first time on remand. Alternatively, the lumber manufacturer contended that, even if the couple’s basis for affirmance was accepted, Oregon’s statutory cap on noneconomic damages does not violate the remedy clause because the statute provides a "substantial remedy" to the injured worker. In addition, the remedy clause did not apply to his wife’s loss-of-consortium claim because "Oregon law does not recognize a ‘property’ right to non-pecuniary services, society, and companionship from a spouse," the company maintained.

Waiver. With respect to Weyerhaeuser’s argument that the law of the case doctrine precluded the appeals court’s consideration of the couple’s remedy clause-based challenge, the appellate panel found that the doctrine did not apply in the instant circumstance because no appellate court had made a binding ruling or decision on whether the remedy clause precludes application of the statutory damages cap in the case at bar. Rather, the trial court had based its decision regarding the damages-cap issue on a different constitutional basis, and neither the appeals court nor the state supreme court had yet addressed whether the application of the cap would violate the constitution’s remedy clause.

Furthermore, the couple was advancing their remedy-clause argument on remand, and not in a subsequent appeal. In fact, the unique circumstances of the litigation and the significant change of law in between the initial appeal and the remand led to the conclusion that consideration of the remedy clause argument was consistent with judicial efficiency and did not run afoul of the waiver rule.

Remedy clause. The Oregon Constitution’s remedy clause provides, in part, that "every man shall have remedy by due course of law for injury done him in his person, property, or reputation." As a threshold matter, Weyerhaeuser asserted that the wife’s loss-of-consortium claim was not protected by the remedy clause because her claim did not involve an injury to her "person, property, or reputation." Whatever the historical origins of a loss of consortium claim, however, in modern parlance the spouse’s claim alleged an injury to person protected by the remedy clause. Although no existing Oregon case explicitly has addressed whether a spousal loss-of-consortium claim is a type of "injury to person," the claim is analogous to other tort cases that have recognized emotional harm as an injury to person. In short, given the nature of a loss-of-consortium claim and the nature of other claims that are considered bodily injuries, it was incongruous to conclude that the type of injury suffered by the injured man’s wife was not an "injury to person" protected by the remedy clause.

As for the constitutionality of reducing the couple’s noneconomic damages awards under the statutory cap, the couple’s "as applied" challenge to the statutory provision—which required the court to answer whether the statutorily substituted remedy of $500,000 was "substantial" under the remedy clause—the appellate panel found that given the nature of the couple’s injuries, the lack of any quid pro quo in the statutory damages cap, and the conclusion that the state legislature’s reason for enacting the noneconomic damages cap could not bear the weight of the dramatic reduction in noneconomic damages that the statute requires for the most grievously injured plaintiffs, reducing plaintiffs’ noneconomic damages awards to $500,000 would leave them without a "substantial" remedy as required by the remedy clause.

The statutory cap on noneconomic damages would leave the injured man, a paraplegic because of those injuries, with $500,000 of the $2,343,750 in noneconomic damages that the jury awarded him—representing a $1,843,750 reduction in his award. As for the worker’s spouse, it could not be said that reducing her award by $259,375 was a bare reduction in her noneconomic damages that left her with a "substantial" remedy; therefore, the application of the statutory cap to both of their awards violated the constitution’s remedy clause. Accordingly, the trial court’s limited judgment was affirmed, Stayton Builders Mart’s limited judgment was reversed, and the trial court’s general judgment was reversed.

The case is No. A145916.

Attorneys: Michael T. Stone (Brisbee & Stockton LLC) for Weyerhaeuser Co. Maureen Leonard (Maureen Leonard, Attorney at Law) for Kevin and Mitzi Rains. Thomas W. Brown (The Brown Law Firm) for Stayton Builders Mart, Inc.

Companies: Weyerhaeuser Co.; Stayton Builders Mart, Inc.

MainStory: TopStory DamagesNews OregonNews

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