On February 26, 2020, the Tennessee Supreme Court issued its much-awaited opinion in Jodi McClay v. Airport Management Services, LLC, M2019-00511-SC-R23-CV, a case in which the plaintiff challenged the constitutionality of Tennessee's tort caps. In McClay, the 3-2 Court held that Tennessee’s statutory cap on noneconomic damages does not violate the Tennessee Constitution.
The noneconomic damages cap was enacted as part of the Tennessee Civil Justice Act of 2011, which was one of Governor Bill Haslam’s major legislative initiatives upon taking office. The caps statute, enacted as Tennessee Code Annotated § 29-39-102, generally provides for a $750,000 cap on noneconomic damages. The cap is increased to $1,000,000 for “catastrophic loss or injury,” such as injuries resulting in severe burns, multiple amputations, paraplegia, quadriplegia or the wrongful death of a parent with surviving minor children. The statute exempts certain kinds of cases from the cap, such as those in which the defendant had specific intent to inflict serious physical injury, was intoxicated, under the influence of drugs or committed a felony when causing the injury.
The constitutional challenge to the noneconomic damages cap in McClay came about after a United States District Court jury awarded a plaintiff $930,000.00 in noneconomic damages, including pain and suffering, permanent injury and loss of enjoyment of life. Following the plaintiff’s constitutional challenge to the cap statute, the District Court certified three questions of law to the Tennessee Supreme Court. In the 3-2 decision, the Tennessee Supreme Court held that the statutory cap on noneconomic damages does not violate the plaintiff’s right to a trial by jury under the Tennessee Constitution. The Court also rejected challenges to the cap under the separation of powers and equal protection provisions of the Tennessee Constitution.
Prior to the release of the McClay opinion, the viability of the noneconomic damages cap was in doubt. In August of 2019, a Williamson County trial court judge found the cap unconstitutional, for violating the right to a trial by jury, as established in the Tennessee Constitution. That decision is overruled by McClay.
Tennessee has a separate cap statute limiting punitive damage awards. The constitutionality of Tennessee’s cap on punitive damages has never been decided by the Tennessee Supreme Court. In Lindenberg v. Jackson National Life Insurance Company, the United States Court of Appeals for the Sixth Circuit held that the statutory cap on punitive damages violated the right to a jury trial under the Tennessee Constitution. (See 12/26/2018 post regarding Lindenberg) While the McClay court was not called upon to determine the constitutionality of the punitive damages cap, the Court noted: “Decisions by federal circuit courts of appeals are not binding on this Court” and expressed dissatisfaction with the Lindenberg opinion. These comments, and the Court’s analysis of the constitutionality of the noneconomic damages cap, are good indicators that the Tennessee Supreme Court would have upheld the constitutionality of the punitive damages cap if the issue was before the court.
The McClay opinion bodes well for the viability of both caps absent a change in the makeup of the Tennessee Supreme Court. While the Lindenberg decision striking down the punitive damages cap remains on the books, it is unlikely to be followed.
Links:
McClay Opinion, Justice Bivens
Concurring opinion, Justice Kirby
Dissent, Justice Clark
Dissent, Justice Lee
Comments