University of Miami v. Echarte

• Decision Date: 13 May 1993
• Docket Number: No. 78210,78210
• Parties: , 18 Fla. L. Week. S284 UNIVERSITY OF MIAMI, etc., Appellant, v. Patricia ECHARTE, etc., et al., Appellees.
• Court: Florida Supreme Court

Page 189

618 So.2d 189

61 USLW 2779, 18 Fla. L. Week. S284

UNIVERSITY OF MIAMI, etc., Appellant, v. Patricia ECHARTE, etc., et al., Appellees.

No. 78210.

Supreme Court of Florida.

May 13, 1993.

Steven E. Stark and Michael L. Friedman of Fowler, White, Burnett, Hurley, Banick & Strickroot, P.A., Miami, for appellant.

Joel D. Eaton and Joel S. Perwin of Podhurst, Orseck, Josefsberg, Eaton, Meadow, Olin & Perwin, P.A., and Grossman & Roth, P.A., Miami, for appellees.

Robert A. Butterworth, Atty. Gen. and Louis F. Hubener, Asst. Atty. Gen., Tallahassee, amicus curiae for State of Fla.

James E. Tribble of Blackwell & Walker, P.A., Miami, amicus curiae for Florida Defense Lawyers Ass'n, Inc.

Julian Clarkson of Holland & Knight, Tallahassee, and David W. Spicer of Bobo, Spicer, Ciotoli & Fulford, West Palm Beach, amicus curiae for Physicians Protective Trust Fund.

Robert M. Klein of Stephens, Lynn, Klein & McNicholas, P.A., Miami, amicus curiae for Florida Medical Ass'n, Florida Hosp. Ass'n and American Medical Ass'n.

Cheryl S. Flax-Davidson, Washington, DC, amicus curiae for Ass'n of Trial Lawyers of America.

Roy D. Wasson, Miami, amicus curiae for Academy of Florida Trial Lawyers.

HARDING, Justice.

We have for review University of Miami v. Echarte, 585 So.2d 293 (Fla. 3d DCA 1991), in which the Third District Court of Appeal affirmed the trial court's ruling that sections 766.207 and 766.209, Florida Statutes (Supp.1988), violated the Florida Constitution. We have jurisdiction based on article V, section 3(b)(1) of the Florida Constitution.

The issue here is whether sections 766.207 and 766.209, which provide a monetary cap on noneconomic damages in medical malpractice claims when a party requests arbitration, violate a claimant's right of access to the courts. ¹ We find that the statutes at issue provide a commensurate benefit to the plaintiff in exchange for the monetary cap, and thus, we hold the statutes satisfy the right of access to the courts test set forward in Kluger v. White, 281 So.2d 1 (Fla.1973).

The University of Miami ² (University) treated Patricia Echarte, a minor, for a brain tumor. However, as a result of the University's alleged negligence, Patricia's right hand and forearm had to be amputated in order to save her life. Patricia and her parents (Echartes) gave the University notice of intent to initiate a malpractice action. ³ In response, the University requested that the Echartes submit their damages to a medical negligence arbitration panel pursuant to section 766.207(2). The Echartes filed an action for a declaratory judgment questioning the constitutionality of sections 766.207 and 766.209.

The trial court ruled that the statutes violated the Echartes' constitutional right of access to the courts, right to trial by jury, ⁴ equal protection guarantees, ⁵ and procedural and substantive due process rights; ⁶ violated the single subject requirement; ⁷ constituted a taking without compensation; ⁸ and involved an improper delegation of authority. ⁹ On appeal the district court affirmed the trial court's holding, but limited its discussion to the right of access to the courts. ¹⁰ Similarly, we limit our discussion to the validity of the statutes under the right of access to the courts. However, we have also considered the other constitutional claims and hold that the statutes do not violate the right to trial by jury, equal protection guarantees, substantive or procedural due process rights, the single subject requirement, the taking clause, or the non-delegation doctrine.

The Legislature enacted the statutory scheme at issue following the recommendations and study made by the Academic Task Force for Review of the Insurance and Tort Systems (Task Force). ¹¹ In studying medical malpractice insurance costs, the Task Force found that the

primary cause of increased malpractice premiums has been the substantial increase in loss payments to claimants and not excessive insurance company profits nor the insurance industry underwriting cycle. Further, the Task Force found that the dramatic increase in the size or amounts of paid claims was the major cause of the increase in total claims payments; the frequency of claims against physicians increased only slightly. In particular, the size and increasing frequency of the very large claims were found to be a problem. Finally, attorneys' fees and other litigations costs were found to represent approximately 40 percent of the total costs of insurance companies, while claimants received 43.1 percent of the insurers' total incurred costs. During the past eleven years, the average cost of defending a malpractice claim had increased at an annual compound rate of seventeen percent.

Academic Task Force for Review of the Insurance and Tort Systems, Medical Malpractice Recommendations at 10-11 (Nov. 6, 1987) (footnotes omitted) (on file with H.R.Comm. on Ins., The Capitol). The Task Force recommended implementation of a medical malpractice plan designed to stabilize and reduce medical liability premiums. The recommended plan included that parties conduct a reasonable investigation preceding malpractice claims and defenses in order to eliminate frivolous claims and defenses, and incentives for parties to arbitrate medical malpractice claims in order to reduce litigation expenses. The Legislature adopted the Task Force's recommendations and findings in chapter 88-1, Laws of Florida, ¹² and section 766.201, Florida Statutes (Supp.1988). ¹³ The statutes at issue are two components recommended by the Task Force to address the medical liability insurance crisis: 1) a presuit investigation process to eliminate frivolous claims and 2) a voluntary arbitration process to encourage settlement of claims.

Sections 766.203-.206 set out the presuit investigation procedure that both the claimant and defendant must follow before a medical negligence claim may be brought in court. The first step in the presuit investigation is for the claimant to determine whether reasonable grounds exist to believe that a defendant acted negligently in the claimant's care or treatment, and that this negligence caused the claimant's injury. Sec. 766.203(2), Fla.Stat. (Supp.1988). Section 766.203(2) also requires that the medical negligence claim be corroborated by a "verified written medical expert opinion" before giving notice to a defendant. After the claimant has established the reasonable grounds to believe that negligence occurred, the defendant or defendant's insurer is required to conduct a presuit investigation. Sec. 766.203(3), Fla.Stat. (Supp.1988).

If the claimant's reasonable grounds for the medical negligence claim are intact at the completion of the presuit investigation, either party may request that a medical arbitration panel determine the amount of damages. Sec. 766.207(2), Fla.Stat. (Supp.1988). Section 766.207 provides that upon such request, the opposing party's agreement to participate in arbitration binds both parties to the arbitration panel's decision and precludes other remedies by the claimant against the defendant.

Under section 766.207(7) a claimant can recover net economic damages of past and future medical expenses and eighty percent of lost wages and earning capacity. The claimant's noneconomic damages ¹⁴ are "limited to a maximum of $250,000 per incident," and are "calculated on a percentage basis with respect to capacity to enjoy life." ¹⁵ Sec. 766.207(7). Finally, section 766.211, Florida Statutes (Supp.1988), provides for prompt payment of the award to the claimant, including interest at the legal rate and a penalty rate if the defendant fails to pay within ninety days of the award.

Section 766.207(7) holds the defendant responsible for the prompt payment of the arbitration award and interest on all accrued damages, payment of the claimant's reasonable attorney's fees and costs as determined by the arbitration panel up to fifteen percent of the award, and payment of all arbitration costs. In addition, section 766.207(7)(h) holds each defendant participating in the arbitration proceeding jointly and severally liable for all damages assessed by the panel. Section 766.207(7)(k) provides that if a defendant rejects a claimant's offer to arbitrate, then section 766.209(3), Florida Statutes (Supp.1988), applies; and if a claimant rejects a defendant's offer to arbitrate, then section 766.209(4), Florida Statutes (Supp.1988) applies.

Section 766.209(3) provides that if the defendant refuses arbitration, the claimant proceeds to trial without any limitation on damages and is entitled to receive reasonable attorney's fees up to twenty-five percent of the award. Section 766.209(4) provides that if a claimant refuses a defendant's offer to arbitrate, then a claimant proceeds to trial; however, noneconomic damages are capped at $350,000 per incident.

The seminal case in a constitutional challenge to the right of access to courts is Kluger v. White, 281 So.2d 1 (Fla.1973). In Kluger, this Court invalidated a statute requiring a minimum of $550 property damages arising from an automobile accident before bringing an action. This Court held that:

[w]here a right of access to the courts for redress for a particular injury has been provided by statutory law predating the adoption of the Declaration of Rights of the Constitution of the State of Florida, or where such right has become a part of the common law of the State pursuant to Fla.Stat. Sec. 2.01, F.S.A., the Legislature is without power to abolish such a right without providing a reasonable alternative to protect the rights of the people of the State to redress for injuries, unless the Legislature can show an overpowering public necessity for the abolishment of such right, and no alternative method of meeting such public necessity can be shown.

Kluger 281 So.2d at 4. Based upon the Kluger test, this Court has also invalidated a portion of a tort reform statute that placed a cap on all noneconomic...