In a case decided on December 15, 2014, the Supreme Court of California held that the $250,000 cap on noneconomic damages imposed by Section 3333.2, subdivision (b) of MICRA (“Medical Injury Compensation Reform Act of 1975”) applies only to judgments awarding noneconomic damages (“Only noneconomic damages awarded in court are actually capped”), and that the defendant physician had failed to establish any degree of fault of the co-defendants who had settled the medical malpractice claims against them before trial (had the defendant physician done so at trial, he would have been entitled to a proportionate reduction in the capped award of noneconomic damages).
The Underlying Facts
The 26-year-old plaintiff had gone to the defendant hospital’s emergency room in April 2007 because he had a severe nosebleed. He returned to the defendant hospital the following month with another severe nosebleed. The defendant physician examined the plaintiff and recommended surgery that was performed the same day. The surgery involved placing a catheter inserted in his leg that led to his nose through which tiny particles manufactured by another defendant were injected to irreversibly block certain blood vessels. However, when the plaintiff woke up after the surgery, he was permanently blind in one eye.
The plaintiff sued the manufacturer of the tiny particles used during his surgery for product liability, failure to warn, negligence per se, breach of express, and implied warranty, alleging that the tiny particles, which were marketed as being uniform in size and thereby allowing accurate targeting of particular arteries, were in fact irregular in size, thereby being able to travel through very small blood vessels and collateral veins and causing the plaintiff’s blindness. He also sued the physician and the hospital, for medical malpractice and medical battery.
The plaintiff settled before trial with the defendant manufacturer for $2 million and he settled with the defendant hospital for $350,000. The trial left only the physician as a defendant. The defendant physician did not provide the jury with any evidence of the hospital’s fault and the trial judge ruled that the defendant physician had failed to provide sufficient evidence of the manufacturer’s fault in order to let the jury make that determination. The jury determined that the defendant physician’s negligence injured the plaintiff and awarded $125,000 for the plaintiff’s future medical care (economic damages), $331,250 for past noneconomic damages, and $993,750 for future noneconomic damages. The court reduced the total noneconomic damages awarded by the jury to $250,000, pursuant to the MICRA cap.
The defendant physician requested that the trial judge impose offsets against the judgment for the pretrial settlements with both the hospital and the manufacturer, which request was rejected because there was no basis for allocating the settlement sums between economic and noneconomic losses, and the jury made no finding as to the settling defendants’ proportionate fault.
California law allows a nonsettling tortfeasor to set off the amount of a jointly liable tortfeasor’s settlement against damages awarded at trial; however, tortfeasors are jointly liable for only economic damages (Code of Civil Procedure section 877). With regard to noneconomic damages, each defendant is liable only for the amount of noneconomic damages allocated to that defendant in direct proportion to that defendant’s percentage of fault (Civil Code section 1431.2). Therefore, when a pretrial settlement does not differentiate between economic and noneconomic losses, a post-verdict allocation is required because only the amount attributable to the joint responsibility for economic damages may be used as an offset.
The California Supreme Court stated that the defendant physician had failed to establish that any other defendant was at fault and thus section 1431.2 would require him to pay the entire amount of the $250,000 noneconomic damage award, unless MICRA demanded a different result. The California Supreme Court looked to Section 3333.2 of MICRA, which states: “(a) In any action for injury against a health care provider based on professional negligence, the injured plaintiff shall be entitled to recover noneconomic losses to compensate for pain, suffering, inconvenience, physical impairment, disfigurement and other nonpecuniary damage. (b) In no action shall the amount of damages for noneconomic losses exceed two hundred fifty thousand dollars ($250,000).” (emphasis added)
The California Supreme Court determined that the noneconomic “damages” identified in section 3333.2, subdivision (b) are limited to amounts awarded by a court (“Ordinarily, where the Legislature uses a different word or phrase in one part of a statute than it does in other sections or in a similar statute concerning a related subject, it must be presumed that the Legislature intended a different meaning … The distinction between “damages,” which are capped under subdivision (b) of section 3333.2, and “losses,” which are addressed in subdivision (a), is well understood. “Loss” is the generic term, which includes “damage” as a subset … Noneconomic damages, in particular, are ascertainable only at trial. They are inherently nonpecuniary, unliquidated and not readily subject to precise calculation. The amount of such damages is necessarily left to the subjective discretion of the trier of fact … Accordingly, the ordinary meaning of the statutory terms indicates that the noneconomic “damages” identified in section 3333.2, subdivision (b) are limited to amounts awarded by a court.”)
The California Supreme Court held: “We conclude that the cap imposed by section 3333.2, subdivision (b) applies only to judgments awarding noneconomic damages. Here, the cap performed its role in the settlement arena by providing [the hospital] with a limit on its exposure to liability. Had [the defendant physician] established any degree of fault on his codefendants’ part at trial, he would have been entitled to a proportionate reduction in the capped award of noneconomic damages.”
Source Hamid Rashidi v. Franklin Moser, S214430.
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