Watts v. Lester E. Cox Med. Ctrs., SC 91867.

• Citation: 376 S.W.3d 633
• Decision Date: 25 September 2012
• Docket Number: No. SC 91867.,SC 91867.
• Parties: Deborah WATTS as Next Friend for Naython Kayne Watts, Appellant/Cross–Respondent, v. LESTER E. COX MEDICAL CENTERS d/b/a Family Medical Care Center, Lester E. Cox Medical Centers, Respondent, Melissa R. Herrman, M.D., Matthew P. Green, D.O., and William S. Kelly, M.D., Respondents/Cross–Appellants.
• Court: Missouri Supreme Court

376 S.W.3d 633

Deborah WATTS as Next Friend for Naython Kayne Watts, Appellant/Cross–Respondent,
v.
LESTER E. COX MEDICAL CENTERS d/b/a Family Medical Care Center, Lester E. Cox Medical Centers, Respondent,
Melissa R. Herrman, M.D., Matthew P. Green, D.O., and William S. Kelly, M.D., Respondents/Cross–Appellants.

No. SC 91867.

Supreme Court of Missouri,
En Banc.

July 31, 2012.
Rehearing Denied Sept. 25, 2012.
Opinion Modified on Court's Own Motion Sept. 25, 2012.

Held Unconstitutional

V.A.M.S. § 538.210

[376 S.W.3d 635]

Andre M. Mura, Center for Constitutional Litigation, Washington, D.C., Roger Johnson, Johnson, Vorhees & Martucci, Joplin, for Watts.

Kent O. Hyde, David E. Overby, Hyde, Love & Overby LLP, Springfield, for Cox.

Jeremiah J. Morgan, Attorney General's Office, Jefferson City, for the Center and Physicians.

RICHARD B. TEITELMAN, Chief Justice.

Deborah Watts filed the underlying medical malpractice action alleging that her son, Naython Watts, was born with disabling brain injuries because Cox Medical Centers and its associated physicians (collectively, Cox) provided negligent health care services. The jury returned a verdict in favor of Watts and awarded $1.45 million in non-economic damages and $3.371 million in future medical damages. The trial court entered a judgment reducing Watts' non-economic damages to $350,000 as required by section 538.210.¹ The judgment also established a periodic payment schedule pursuant to section 538.220. The periodic payment schedule required immediate payment of half of all net future medical damages with the other half paid in equal annual installments over the next 50 years with an interest rate of 0.26 percent.

Watts asserts that the section 538.210 cap on non-economic damages violates the right to trial by jury and several other provisions of the Missouri Constitution.² Watts also asserts that the section 538.220 periodic payment schedule was arbitrary and unreasonable in that it does not assure full compensation due to the low interest rate and 50–year payment schedule.

[376 S.W.3d 636]

Cox has filed a cross-appeal asserting that the trial court erred in its immediate award of future medical damages. Cox asserts that section 538.220 prohibits a lump sum payment of a portion of future medical damages and, instead, requires that all future medical damages be paid pursuant to a periodic payment schedule regardless of when the need for the medical damage payments will arise.

This Court holds that section 538.210 is unconstitutional to the extent that it infringes on the jury's constitutionally protected purpose of determining the amount of damages sustained by an injured party. Such a limitation was not permitted at common law when Missouri's constitution first was adopted in 1820 and, therefore, violates the right to trial by jury guaranteed by article I, section 22(a) of the Missouri Constitution. Accordingly, the judgment is reversed to the extent that it caps non-economic damages pursuant to section 538.210. To the extent that the decision in Adams By and Through Adams v. Children's Mercy Hosp., 832 S.W.2d 898, 907 (Mo. banc 1992), is inconsistent with this decision, it is overruled.

This Court further holds that the trial court abused its discretion in entering a periodic payment schedule pursuant to section 538.220 that did not assure full compensation due to the interest rate and 50–year payment schedule.

Finally, this Court holds that section 538.220 gives the judge the authority to determine the manner in which future damages shall be paid, including what portion should be paid in future installments as to both medical and other future damages. Cox's argument on cross-appeal that all future damages must be paid in a lump sum is rejected.

In all other respects, the judgment is affirmed. The case is remanded.

I. Facts

Cox provided prenatal care to Watts. On October 30, 2006, when she was approximately 39 weeks pregnant, Watts went to a clinic associated with Cox because she was experiencing cramping and because she detected decreased fetal movement. Dr. Herrman, who was then a third-year medical resident, examined Watts. The evidence at trial indicated that Dr. Herrman did not perform appropriate tests, failed to notify Watts of the significance of decreased fetal movement and failed to perform any further diagnostic monitoring. Dr. Herrman's supervisor, Dr. Kelly, signed off on Dr. Herrman's findings.

On November 1, 2006, Watts was admitted to the hospital due to lack of fetal movement. Watts was placed on a fetal monitor at 9:10 a.m. Watts' expert, Dr. Roberts, testified that this diagnostic monitoring indicated fetal hypoxia and acidosis and that the standard of care required immediate Caesarean-section delivery. Dr. Green, the second-year medical resident who was examining Watts, did not begin the Caesarean section until 10:45 a.m. Naython Watts was born with catastrophic brain injuries.

Watts sued Cox, claiming that its doctors' malpractice caused Naython's brain injuries. After trial, the jury returned a verdict in favor of Watts and awarded $1.45 million in non-economic damages and $3.371 million in future medical damages. The jury then reduced the future medical damages to present value pursuant to section 538.220. The jury reduced the future damages at a rate of 4 percent per annum, the estimated yield on a safe long-term investment, which worked out to a present value of $1,747,600. Cox then requested that it be permitted to pay the future damages in periodic payments pursuant to

[376 S.W.3d 637]

section 538.220. In response, the trial court entered a payment schedule under which half of the future damages would be paid immediately in a lump sum and half would be paid over a 50–year period at a statutorily required interest rate of 0.26 percent.

II. Standard of Review

This Court has exclusive jurisdiction over this appeal because it involves a challenge to the validity of a statute of this state. Mo. Const. article V, section 3. Watts' constitutional challenge to the validity of section 538.210 is subject to de novo review. Rentschler v. Nixon, 311 S.W.3d 783, 786 (Mo. banc 2010). “A statute is presumed valid and will not be held unconstitutional unless it clearly contravenes a constitutional provision.” Id. at 786. Watts has the burden of proving that the statutes “clearly and undoubtedly” violate the constitution. Id.

Watts' argument that the trial court erred by requiring one-half of future medical damages to be paid pursuant to a section 538.220 periodic payment schedule “is subject to review only on the basis of its arbitrariness.” Vincent by Vincent v. Johnson, 833 S.W.2d 859, 866 (Mo. banc 1992). Appellate courts ask whether a circuit court abused its discretion in crafting a periodic payment schedule for future damages. Davolt v. Highland, 119 S.W.3d 118, 139 (Mo.App.2003). “A trial court will be found to have abused its discretion when a ruling is clearly against the logic of the circumstances then before the court and is so arbitrary and unreasonable as to shock the sense of justice and indicate a lack of careful consideration.” Klotz v. St. Anthony's Medical Center, 311 S.W.3d 752, 760 (Mo. banc 2010) (quoting Swartz v. Gale Webb Transp. Co., 215 S.W.3d 127, 129–130 (Mo. banc 2007)).

Cox's cross appeal asserts that section 538.220 requires all future medical damages to be paid according to a periodic payment schedule. This is a statutory interpretation argument subject to de novo review. Spradling v. SSM Health Care St. Louis, 313 S.W.3d 683, 686 (Mo. banc 2010). This Court's role in interpreting statutes is to discern the intent of the legislature from the plain and ordinary meaning of the language used and to give effect to that intent, if possible. Id.

III. Section 538.210 Violates the Right to Trial by Jury

Watts asserts that the $350,000 cap on non-economic damages established by section 538.210 violates the right to trial by jury guaranteed by article I, section 22(a) of the Missouri Constitution, which provides that “the right of trial by jury as heretofore enjoyed shall remain inviolate....” Cox notes correctly that in Adams I, the Court held that the statutory cap on non-economic damages does not violate the right to trial by jury. Cox asserts that Adams is dispositive. Watts asserts that Adams was decided wrongly and should be overruled.

A. Article I, Section 22(a) Requires that the Right of Trial by Jury as Heretofore Enjoyed Shall Remain Inviolate

Article I, section 22(a) is one of the fundamental guarantees of the Missouri Constitution, providing “the right of trial by jury as heretofore enjoyed shall remain inviolate....” The plain language of article I, section 22(a) requires analysis of two propositions to determine if the cap imposed by section 538.210 violates the state constitutional right to trial by jury.

The first portion of article I, section 22(a) requires a determination of whether Watts' medical negligence action and claim for non-economic damages is included within “the right of trial by jury

[376 S.W.3d 638]

as heretofore enjoyed.” The phrase “heretofore enjoyed” means that “[c]itizens of Missouri are entitled to a jury trial in all actions to which they would have been entitled to a jury when the Missouri Constitution was adopted” in 1820. State ex rel. Diehl v. O'Malley, 95 S.W.3d 82, 85 (Mo. banc 2003). In the context of this case, the scope of that right also is defined by common law limitations on the amount of a jury's damage award. See, Klotz, 311 S.W.3d at 775 (Wolff, J., concurring). Therefore, if Missouri common law entitled a plaintiff to a jury trial on the issue of non-economic damages in a medical negligence action in 1820, Watts has a state constitutional right to a jury trial on her claim for damages for medical malpractice.

The second portion requires this Court to determine whether the right to trial by jury “remain[s] inviolate” when a statutory cap requires courts to reduce the jury's...