Prendergast v. Nelson, 41199

Citation256 N.W.2d 657,199 Neb. 97
Decision Date20 July 1977
Docket NumberNo. 41199,41199
CourtSupreme Court of Nebraska
PartiesRichard A. PRENDERGAST, Harlan L. Papenfuss, and St. Elizabeth Community Health Center, a corporation, Appellees, v. Earl Benjamin NELSON * , Director of Insurance, State of Nebraska, Appellant.

Page 657

256 N.W.2d 657
199 Neb. 97
Richard A. PRENDERGAST, Harlan L. Papenfuss, and St. Elizabeth Community Health Center, a corporation, Appellees,
Earl Benjamin NELSON *, Director of Insurance, State of Nebraska, Appellant.
No. 41199.
Supreme Court of Nebraska.
July 20, 1977.

Page 660

Syllabus by the Court

1. The statute of limitations is tolled during the period the matter of medical liability is subject to consideration by the medical review panel and for a period of 90 days following its opinion.

2. A person has no property, no vested interest, in any rule of the common law. That is only one of the forms of municipal law, and is no more sacred than any other. Rights of property which have been created by the common law cannot be taken away without due process, but the law itself, as a rule of conduct, may be changed at the will, or even at the whim, of the Legislature, unless prevented by constitutional limitations. Indeed, the great office of statutes is to remedy defects in the common law as they are developed, and to adapt it to the changes of time and circumstances.

3. It is incumbent on this court, when reasonably possible and consistent with constitutional rights, to resolve all doubts as to the validity of a statute in [199 Neb. 98] favor of its

Page 661

constitutional validity. If possible, a statute should be construed in such a way as to negative any constitutional infirmity.

4. All claims or causes of action arising while the patient and the health care provider were subject to the terms and provisions of an act would be subject to adjudication in accordance with the provisions of the act. While each of the parties could change his or her status before a cause of action arose, if the cause of action arose while the parties were subject to the act, they remain subject to it as to that cause of action until its determination.

5. The Legislature may make a reasonable classification of persons, corporations, and property for purposes of legislation concerning them, but the classification must rest upon real differences of situations and circumstances surrounding the members of the class relative to the subject of the legislation which render appropriate its enactment.

6. While it is competent for the Legislature to classify for purposes of legislation, the classification, to be valid, must rest on some reason of public policy, some substantial difference of situation or circumstance, that would naturally suggest the justice or expediency of diverse legislation with respect to the objects to be classified.

7. In the area of economics and social welfare, a state does not violate the Equal Protection Clause merely because the classifications made by its laws are imperfect. If the classification has some "reasonable basis," it does not offend the Constitution simply because the classification "is not made with mathematical nicety or because in practice it results in some inequality."

8. A statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it.

9. The Equal Protection Clause does not require that a state must choose between attacking every aspect of a problem or not attacking the problem at all. It is enough that the state's action be rationally based and free from invidious discrimination.

10. The Legislature, consistent with the dictates of the state and federal Constitutions, may pass a law which seeks to distinguish between different types of tort actions. This is conditioned, however, upon those distinctions being reasonable and grounded upon real differences inherent in those tort actions.

11. The Supreme Court will not set aside a statutory discrimination if any state of facts reasonably exists to justify it.

12. There is no impairment of the obligation of contract. The purpose of this provision is to [199 Neb. 99] eliminate possible windfalls resulting from double recovery of damages.

13. The Legislature was within its authority in requiring that fee arrangements be subject to review by the courts.

14. The Nebraska Hospital-Medical Liability Act in no way may be construed to grant or impair the credit of the state.

15. Nothing in the Nebraska Hospital-Medical Liability Act in any way implies the state is to be obligated with respect to the Excess Liability Fund or liable for any other amounts due pursuant to the act.

16. All persons are charged with knowledge of the provisions of statutes. They must take note of the procedure adopted by them. When that procedure is not unreasonable or arbitrary, there are no constitutional limitations relieving them from conforming to it.

17. In construing an act of the Legislature, all reasonable doubts must be resolved in favor of its constitutionality.

18. It is elementary that it is not within the province of the courts to annul a legislative act unless its provisions so clearly contravene a provision of the fundamental law, or it is so clearly against public policy, that no other resort remains.

Paul L. Douglas, Atty. Gen., Terry R. Schaaf, Asst. Atty. Gen., Lincoln, for appellant.

Erickson, Sederstrom, Johnson & Fortune, Omaha, on brief for Prendergast.

Cline, Williams, Wright, Johnson & Oldfather, Lincoln, on brief for St. Elizabeth's Community Health Center.

Page 662


SPENCER, Justice.

This is a declaratory judgment action seeking a determination of the constitutionality of the Nebraska[199 Neb. 100] Hospital-Medical Liability Act, sections 44-2801 to 44-2855, R.S.Supp.1976. Plaintiffs are Richard A. Prendergast, a qualified and practicing nurse anesthetist, Harlan L. Papenfuss, a licensed and practicing physician, and St. Elizabeth Community Health Center, a nonprofit Nebraska corporation. Defendant is the Director of Insurance for the State of Nebraska. This action was filed after the defendant refused to implement the provisions of the act. The District Court found the act constitutional and ordered the Director of Insurance to carry out his duties as required by the act, but stayed the order pending this appeal. We find the act constitutional, and affirm.

We have no question as to the right of the Director of Insurance to question the act as special legislation and as granting the credit of the state in aid of an individual, association, or corporation. We do question the right of the director to raise any question that the act denies an injured party due process or equal protection, or denies the right of access to the courts and the right of a trial by jury.

While we have been liberal in determining the standing of the Attorney General to sue in the name of the State, we have never granted standing except where either the State or the defendants had a direct interest in and were affected by the issues raised. See State ex rel. Sorensen v. State Board of Equalization & Assessment, 123 Neb. 259, 242 N.W. 609, 243 N.W. 264 (1932). Ordinarily a litigant can question a statute's unconstitutionality only when it is being applied to his disadvantage. State v. Brown, 191 Neb. 61, 213 N.W.2d 712 (1974).

The various questions herein are raised by way of answer to the petition of the plaintiffs in seeking to require the defendant to implement the act. In view of the fact that the plaintiffs are entitled to the relief they seek and the defendant is in a position to question some portions of the act to avoid further litigation[199 Neb. 101] we make an exception in this instance and review all the questions of constitutionality raised in the answer.

The Legislature in the act, Laws 1976, L.B. 434, specifically finds and declares it is in the public interest that competent medical and hospital services be available to the public in the State of Nebraska at reasonable costs; that prompt and efficient methods be provided for eliminating the expense as well as useless expenditure of time of physicians and courts in nonmeritorious malpractice claims; and that a method be provided to efficiently resolve meritorious claims. The Legislature also finds the act essential to assure continuing availability of medical care; to encourage physicians to enter into the practice of medicine in Nebraska; and to have them remain in such practice so long as such physicians retain their qualifications.

The act applies to all qualified health care providers. "Health care providers" includes physicians, nurse anesthetists, and hospitals. To qualify under the act a health care provider must file proof of financial responsibility with the Director of Insurance, and pay surcharges levied for the Excess Liability Fund.

We discuss the provisions of the act as the questions are raised as to its constitutionality in the brief of the defendant. We state first, however, a patient's exclusive remedy against a qualified health care provider is under the act unless the patient has elected not to come within the provisions of the act.

To avoid its provisions, notice of the election must be filed with the Director of Insurance in advance of treatment. Also, the health care provider must be notified as soon as is reasonable under the circumstances that the patient has so elected. This election is effective for a period of 2 years unless sooner revoked. Every qualified health care provider is required to post a notice that he has qualified under the act.

Page 663

[199 Neb. 102] The defendant contends first that the provisions of the act creating a medical review panel are void and of no force and effect in that they are contrary to the fundamental mandates of both the state and federal Constitutions. Section 44-2840(2), R.S.Supp., 1976, provides as follows: "No action against a health care provider may be commenced in any court of this state before the claimant's proposed petition has been presented to a medical review panel established pursuant to section 44-2841 and an opinion has been rendered by the...

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