When Lightning Struck

Illinois' Civil Justice System After March 9, 1995

IN THE COURSE OF A FEW DAYS and a single stroke of the pen, lightning struck the civil justice system of Illinois, threatening extermination of personal-injury tort practice here. The massive changes in tort law incorporated in Public Act 89-7 deprive the injured of rights that have been the law of the state for decades, and in some instances as long as a century.

The vast procedural and substantive changes have altered the balance of power established by the Illinois Constitution. The law attacks the jury system and represents an assault by the legislature and executive branch on the judicial branch, nullifying well-established court decisions and common-law precedent without justification. The law lays waste to Illinois' constitutionally-guarded rights to a remedy and court access. It is now for the Illinois Supreme Court to decide whether those guarantees are more than mere words, in light of the legislature's action.

Under the new law, injured consumers can no longer be fairly represented in court, nor can they expect to receive fair and just compensation for their injuries. The loss of these rights will have a dramatic impact in discovery, at trial and, ultimately, on day-to-day lives.

A discussion of the practical application of the new law is not the focus of this article. Rather, I turn to the merits-or rather the demerits-of the law.

$500,000 Cap On Non-Economic Damages

The cap on non-economic damages denies the constitutional right to trial by jury. It is the catastrophic victim who has the most at stake here, and it is big business that stands to exponentially gain by failing to fully compensate for victims' losses. It is, in essence, a pre-emptive and arrogant legislative remittitur for corporate and other special interest defendants.

What's more, it discriminates against the elderly, the unemployed, women and children. Because of well-recognized and pervasive societal conditions resulting in limited income-earning ability, members of these groups rarely can prove substantial economic losses.

A child who loses an arm, a grandparent who becomes brain damaged at the hands of a negligent doctor, a mother not employed outside the house who becomes a quadriplegic due to a negligent trucking company-do any of them suffer any less pain, suffering, disfigurement, loss of consortium or loss of society than a wealthy chairman of the board? Of course not. Yet under this new law, the verdicts will be very different, with the wealthy breadwinner taking home a much larger sum strictly because he was working at the time of the accident and able to earn more. What clearer picture of discrimination could be possible? These groups have lost the "equalizer" which allows a jury to compensate them for the intangibles of their existence when the tangibles are not present. No more compensation based upon the "whole person."

The cap also violates the equal protection clause of the Illinois constitution. It appears to limit the entire award in a wrongful death case to $500,000, which means that the award must be divided among beneficiaries. Each survivor, in the case of a husband who is negligently killed, leaving a wife and seven children, receives substantially less than the parents of an only child bachelor. The limited discussion on the floor of the House on this point proved that the legislation voting in favor did not understand the wording of their own bill.

The $500,000 cap is disturbing in its arbitrariness, in its ability to allow negligent defendants to make their negligence a quantifiable cost of doing business, and in its theft of the constitutional right to have the issue of damages decided by the jury. Article 1, Section 13 of the Illinois Constitution provides that "The right to trial by jury as heretofore enjoyed shall remain inviolate." The operative word is "shall." Other states that have upheld this mandatory language have struck down caps as unconstitutional.

Furthermore, Article 1, Section 12 of the Illinois Constitution provides for a right to remedy and justice in that "Every person shall find a certain remedy in the laws for all injuries and wrongs which he receives to his person, privacy, property or reputation. He shall obtain justice by law, freely, completely, and promptly." Caps unconstitutionally restricts this open access to the courts provision.

It has been found to be unfair for a jury to be restricted in its awarding all damages that naturally flow from the commission of a tort. Many state courts have held that caps run afoul of various constitutional provisions.

To insure that the jury would be deceived into believing the plaintiff would receive the entire award, even if it exceeds the cap, the new law prevents the jury from even learning about the existence of the caps on damages.

Sadly, not one state that has enacted caps on non-economic damages reportedly has experienced a decrease-or even a stabilization-of malpractice premiums which has been passed on to the consumer. The cost of a hospital bed in Indiana, which in 1975 imposed a strict $500,000 cap on total damages, is higher than that in Illinois. After Maryland adopted a $350,000 cap, the state's major medical insurer sought and was granted a 50 percent rate increase.

Punitive Damages

Punitive damages, too, have been unjustifiably and severely limited to no more than three times the amount of the plaintiff's economic loss.

The arbitrary limit set by the legislature emasculates the purposes and goals of punitive damages; punishing the wilful and wanton conduct of a wrongdoer. Instead, it eliminates a powerful safety incentive that persuaded companies to produce safer products. Now the financial consequences of their harm can be budgeted into corporate yearly statements, as Ford Motor Company did years ago with its Pinto.

Three times the economic loss of a plaintiff is zero for many elderly, women, children and unemployed. Therefore, the status of the wrongdoer is now irrelevant and the economic status of the victim is the determining factor of what constitutes fair punishment for wrongful actions.

Study after study indicates that punitive damages are awarded in very few cases, and the awards generally are commensurate with the compensatory award. The Roscoe Pound Foundation conducted what is considered perhaps the most comprehensive and reliable study in this area. It concluded that in a 25-year period, 1965-1990, just 355 verdicts in state and federal courts throughout the country returned punitive damages awards in product liability cases, with most Fortune 500 companies never experiencing a single one. The median punitive damages award was $625,000.

Now, in Illinois, the jury will be told that the award of any punitive or compensatory damages is not taxable under federal or state income tax law. The jury, however, will not be instructed that any payment made by the corporate defendant will be a tax deduction. Whether a plaintiff pays taxes, tax amounts and future tax rates all have nothing to do with a defendant's culpability, yet these now become factors in determining a damages award.

This provision further words to nullify a benefit conferred on injury victims by Congress. To inform a jury of this issue, and other immaterial issues, is to assume jurors are completely ignoring the judge's instructions, despite no evidence that jurors fail to follow instructions. And if, in fact, jurors are ignoring instructions, why is the legislature's solution to give the jury yet another instruction? "Hedonic damages," although not defined, also have been abolished by Public Act 89-7.

Joint and Several Liability

Another onerous provision of the new law caters to special interests-the obliteration of joint liability, a doctrine that has been part of the common law for hundreds of years.

The new law requires that the conduct of all parties must be considered by the jury in determining an award. The defendant's culpability, any fault of the plaintiff, as well as the fault of any settled party, the plaintiff's employer (even through the plaintiff-anyone-can be taken into the equation, keep in mind that the plaintiff would have no right to recovery against his own employer in a tort action).

On its face, it would appear that no party will be held liable for more than what a jury apportions as its fault. A closer examination of the new law, however, shows that the plaintiff will be bearing more than his or her fair share. For instance, the plaintiff will be bearing responsibility for his or her employer's negligence, with worker's compensation being the plaintiff's sole remedy. The plaintiff's employer may be added to the verdict form, yet the plaintiff will be unable to sue and recover against the employer as a defendant. And if the jury should find the employer liable, that percentage of liability will be deducted from the percentage of the verdict as a whole. Yet plaintiff will pay for the employer's negligence doubly in that the employer's share of damages also will be "credited" to the other defendants against the plaintiff's verdict. The jury is not aware of that fact.

The possibilities for fraud are endless; most obviously, defendants can collusively decide to point all the blame at an employer. In the case of a construction accident, where the general contractor and all subcontractors are covered by the same insurance company, such collusion even becomes likely. The more negligent an employer is found, the less every other defendant pays because of the "credit" component established under the new law.

A contribution action need not be brought at plaintiff's trial, but the defendant may later bring such an action separately. Therefore, plaintiff's verdict may be reduced later without plaintiff even being present in the courtroom.

Furthermore, a real inequity arises in the "empty chair" defense. The plaintiff will put on its entire case against the defendants present. After plaintiff closes its case, however, the defense has a free opportunity to bring in any potentially liable "ghosts" it can create, leaving the plaintiff unable to do anything because its case has been closed. All of the "ghosts" will appear on a verdict form.

The special-interest nature of the legislation becomes especially clear in the context of a single provision of this section of the law. Fearing that an expected constitutional challenge regarding limitations on non-economic damages would be successful, the drafters provided that the doctrine of joint and several liability will be reinstituted for defendants only in the healing arts. Hypocritically, joint and several liability is fair for doctors but not for manufacturers, drunk drivers, negligent trucking companies or other defendants.

The discriminatory effect of this part of the law was an intent of the law's framers, as noted in the preamble to HB 20: "Whereas, it is the public policy of this State that a defendant should not be liable for damages in excess of its proportional share of fault..." Never mind that now the plaintiff must have his damages reduced in excess of his or her fault.

In order to recover under the new law, a plaintiff must include every possible defendant in the original cause of action. Instead of a more efficient system of justice, protracted litigation can be expected.

Physician-Patient Privacy Protection

The legislature eliminated all protection of all health care provider/patient privilege for anyone filing any cause of action for bodily injury, and specifically permitted ex parte conversations between defense counsel and plaintiff's treating physicians.

The new law states that the filing of a case constitutes a waiver of the privilege and requires plaintiff to sign a general consent form in order for an injured patient to bring an action against any wrongdoer. The form broadly waives the doctor/patient privilege to all health care providers for any reason without any time or materiality limitations.

This particularly insensitive and unconstitutional denial of access to the courts and of the right to privacy covers all medical records from the time plaintiff was born-even those that have nothing to do with the injury at issue. For instance, a 60-year-old woman who breaks her arm in an accident may have her gynecological or psychotherapy records from 40 years ago wind up in the hands of the defense counsel. The statute does not recognize any exception to allow these records to remain confidential. Ironically, the medical profession is now put in the precarious position of violating one of its own canons of ethics.

All original records may be obtained directly from the plaintiff's doctor, and such records may be turned over to defense attorneys as well as insurance adjusters, expert witnesses, whoever the defense counsel decides to show them to. If the broad consent form is not signed, the plaintiff's lawsuit will-not may-be dismissed with prejudice.

Furthermore, a plaintiff's treating doctor may now confer with defense counsel without serving notice to the plaintiff, or even informing the patient that such conversations took place. It is now possible for a patient to walk into his doctor's office and meet the defense lawyer walking out.

Public policy upholds the importance of the physician/patient privilege. But state legislators have turned longstanding public policy on its head at the behest of special interest lobbies.

What information do defense counsel hope to get from a doctor in private that could not be elicited at a deposition? Or is it intimidation, backroom dealing and coaching that these special interest groups actually hope to accomplish?

Medical Malpractice Changes

Certain pre-trial procedures instituted under the new law have made practice in this already difficult area even more draconian.

The certificate of merit must now release the expert by name, the kind of disclosure previously considered privileged information. The inherent unfairness of this provision is apparent in that no reciprocity is provided for in the law, because defendants are not required to reveal their experts at this early stage of the lawsuit so as to show that they have a meritorious defense.

Now, to qualify to testify as an expert at trial, the expert must be of the same medical specialty as the doctor charged in the complaint, a practice that ignores realities of medical practice. In the case where the negligence involves several specialties or different types of health care providers, such as doctors, nurses and anesthesiologists, it is presumed under the new law that experts in each of these fields would need to be involved in order to properly allege inadequate care. The cost of litigation certainly will be driven up.

A medical expert must have actively practiced, taught or been engaged in university-based research at least 10 years in order to be qualified as an expert witness. Apparently, privately-funded research by many of the impressive think tanks in this country are of no consequence.

The new law calls for a witness to be barred if these requirements are not met. More seriously, it is the legislature that is now dictating who is qualified to testify on the standard of care, rather than the judiciary.

Product Liability Changes

The changes in this area of law are massive, virtually gutting any effective way to succeed in these cases. For years, the common law held the manufacturer had a nondelegable duty to produce a reasonably safe product. That common law is now abrogated by the legislature.

One change is the requirement that a certificate of merit must be filed within 90 days after the filing of the complaint with no provision for extensions. What makes the requirement onerous is that if the plaintiff is unable to obtain the necessary records or the product in order to properly complete the certificate of merit, the 90-day deadline still runs from the filing of the complaint, not from the receipt of the records. Bad faith, or even innocent delays on the part of the defendant, could throw the plaintiff out of court.

Another requirement is that a prohibitively stringent report, signed by an expert, must accompany the complaint. Yet the law does not require an expert at trial, in contrast to well-established precedent. The requirements of the report in product liability cases are four-fold:

1) The specific defects of the product at the time it left the manufacturer's control must be identified. This requirement contemplates identification beyond what would be contemplated by the user and becomes a near impossibility without the product itself or at least minimal discovery.

2) Non-conformance with a government or industry standard must be identified. The standard need not be a true standard. Even a regulatory measure of any group in the industry is sufficient to deem the product safe. This change completely ignores the fact that the state of the art may be an insufficient design. The new law also provides that the product is presumed to be safe if it complied with these standards. With such a presumption, the plaintiff no longer can present evidence that the standard is too minimal, substandard or unreasonable.

3) A feasible alternative design must have been in existence at the time the product left the manufacturer's control. The alternative design requirement becomes an affirmative burden of proof on the part of the plaintiff, a virtual impossibility without benefit of discovery. Furthermore, making this determination prior to trial requires a finding as to when the defect actually occurred, a determination generally made by the jury.

4) The alternative design must be proven marketable-another impossible burden placed on the plaintiff to demonstrate not only that another manufacturer does it better but also that it does it less expensively. The plaintiff under this law now bears the burden of improving safety, even though prior law required the corporate defendant to do so.

An expert must sign the report certificate without benefit of records or any discovery. Failure to meet all these conditions will compel dismissal of plaintiff's action.

Furthermore, the expert who signs the certificate of merit must be an expert in the specific area of that product. In the case of some highly technical or unusual products, that may become a virtual impossibility for the plaintiff because all experts in the field are employed by the manufacturing industry and general independent experts in the field have not yet emerged.

If a plaintiff files a lawsuit without the ability to properly meet these stringent qualifications, plaintiff cannot voluntarily dismiss the case with the intent to refile. If that is done, the lawsuit is dismissed with prejudice.

Another significant change involves the inadmissibility of evidence regarding any changes in the design or warning involving an allegedly defective product.

Regarding warnings, instructions or labeling of a product, it is deemed to be reasonably safe if the manufacturer merely puts these materials in the hands of the product's seller, regardless of whether the information ever reaches the ultimate user or if the seller no longer even has the materials.

In other words, pharmaceutical manufacturers need only warn the doctors and need not worry about getting the information out to the public. Moreover, these warnings need only be of general industry standards, not necessarily federal or state standards, and need not explain how the product is dangerous.

Obvious risks do not have to carry a warning, and obviousness is measured from the perspective of the industry, not the user of the product. In order to be found liable on a failure to warn count, the plaintiff must prove the negligent manufacturer had actual knowledge of the defect in the product which caused the death, injury or damage.

Furthermore, the statute of repose also has been changed, extinguishing all claims against manufacturers after 10 years from the date of first sale or possession by the user. This harsh rule will wipe out many claims for consumers hurt by asbestos or silicone breast implants, even those killed in commercial airline crashes, because the typical aircraft was manufactured more than 10 years ago.

Given the public policy to make products safer for consumption, this law is anomalous. The new legislation encourages negligent conduct and allows untested products to cause all sorts of harm without recourse, while increased profits pour into the wrongdoers' hands.

Nor do product liability claims have an impact on the insurance market, because insurance premiums account for less than one percent of American business' gross receipts. How could such costs threaten the viability of American business or the cost of goods and services?

Repeal of Road Workers' Safety Act

HB 20 repealed the Road Workers' Safety Act. A bill signed into law earlier this year, HB 201, repealed the Structural Work Act. That leaves an injured construction worker only with worker's compensation claims or a negligence claim. The scope of a general contractor's duties, however, have been limited to where the general contractor will be held liable only when found in control, not for retaining the right to control the job. Now it will be possible for a general contractor to abrogate all responsibility-contending it was not controlling the employee's precise task at the precise moment of injury.

Defendants claim construction workers knowingly engage in hazardous activities. Construction workers, though, explain that their bosses often leave them no choice, their adage being, "My way or the highway."

The saddest result is that incentive for insuring safety on the job is undermined under the new law.

Premises Liability Changes

So sweeping are the changes in premises liability that they virtually wipe out the entire area of liability.

No longer is the possessor of land bearing an open and obvious danger or defect subject to a lawsuit. Illinois law now provides that no duty to warn exists for open and obvious dangers or latent defects, except a duty to children.

Very few types of conduct in construction accident cases can avoid the open and obvious doctrine. This unreasonably high burden combined with the repeal of the Road Workers' Safety Act spells the virtual abolition of construction accident cases in Illinois.

No Apparent Agency

The apparent agency doctrine was invoked most often in the medical malpractice context. The most common scenario involved doctors and hospital personnel who are not staff at a hospital, but are independent contractors performing work there, i.e., anesthesiologists, radiologists and pathologists whom the patient does not choose. Generally, they walk around with name tags and white coats performing tasks similar to all other hospital personnel, yet they are independent contractors.

Hospitals attempt to attract patients to their facilities for their well-advertised quality of treatment, administered by staff and independent contractors alike. Yet now patients who receive such treatment can no longer hold the hospital liable for the work of independent contractors, despite the hospital's advertising vouching for them.

Wrongful Death Cases Repudiated

No longer is a wrongful death action for a decedent's estate separate from a personal injury claim of the decedent.

If an aged or dying personal injury victim wishes to bring a personal injury claim, he or she must consider under the new law whether it is wise to do so. For if a personal injury claim is brought and that person should die during the pendency of that claim, the personal injury claim dies and any wrongful death action becomes impossible. The beneficiaries of that person's estate no longer can claim a separate action for their losses if that person dies, either as a result of his injuries or of natural causes. Conclusion

The civil justice system in Illinois is now unworkable, with measures in place preventing fair and full compensation of injured victims.

Every aspect of this law is an attempt to quantify the unknown for the negligent, even reckless wrongdoer, who can then live without fear of legal restraint. The legislation minimizes wrongdoer risk and allows special interest groups to put a limited and calculated price tag on allowing faulty products and negligent medical care into the marketplace, all at the expense of the innocently injured consumer.

Even elected conservative officials in Washington, mired in bureaucracy, have pulled back from immediate passage of similar massive changes to the federal court system because of the infirmities of such legislation. The Illinois Supreme Court, now driven by millions of dollars of PAC money and special interest groups, has an awesome responsibility to examine the language and effect of this law and answer the questions, "Is there a rational basis for this law, and is it constitutional?"