Knowles v. United States
1996 SD 10, 544 N.W.2d 183, 1996 S.D. LEXIS 11 (1996)
Rule of Law:
A legislative cap on all medical malpractice damages, including economic losses, violates the right to a jury trial, the open courts provision, and substantive due process under the South Dakota Constitution if it lacks a real and substantial relation to its purported objective and arbitrarily burdens severely injured victims without providing a commensurate benefit.
Facts:
- Kris Knowles, a twelve-day-old infant, was admitted to the Ellsworth Air Force Base Hospital for treatment of a fever.
- Medical Service Specialists at the hospital failed to report to nurses or physicians that Kris's temperature had been dropping throughout the night before his scheduled discharge.
- Kris developed hypoglycemia and suffered respiratory arrest due to the unaddressed condition.
- As a result, Kris sustained severe, permanent brain damage.
- William and Jane Knowles, Kris's parents, brought suit on their own behalf and for Kris against the United States for medical malpractice, emotional distress, and loss of consortium.
- The United States admitted liability for medical malpractice.
- The United States sought to limit the judgment to $1 million, invoking SDCL 21-3-11, which caps damages in medical malpractice actions at that amount.
Procedural Posture:
- William and Jane Knowles sued the United States in the United States District Court of South Dakota, Western Division, alleging medical malpractice and other claims.
- The United States District Court ruled that SDCL 21-3-11, which caps medical malpractice damages at $1 million, was constitutional under both the South Dakota and United States Constitutions.
- The district court then entered judgment for $1 million in favor of the Knowles.
- The Knowles appealed the district court's decision to the Eighth Circuit Court of Appeals.
- The Eighth Circuit Court of Appeals certified four questions regarding the South Dakota Constitution and state law to the South Dakota Supreme Court for resolution.
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Issue:
Is SDCL 21-3-11, which imposes a $1 million cap on total damages in medical malpractice actions, unconstitutional under the South Dakota Constitution's provisions guaranteeing the right to a jury trial, open courts and remedy for injury, and due process?
Opinions:
Majority - Justice Richard W. Sabers
Yes, the SDCL 21-3-11 damages cap is unconstitutional under the South Dakota Constitution. The cap violates the right to a jury trial, the open courts and remedy-for-injury provision, and due process. The right to a jury trial, guaranteed to remain 'inviolate' under Article VI, § 6, includes the jury's essential function of determining the amount of damages; an automatic and absolute cap renders the jury's role advisory. The open courts provision (Article VI, § 20) ensures a 'full remedy' for injuries, which is denied when the legislature arbitrarily caps recovery, placing an undue burden on severely injured victims. Furthermore, the cap violates due process (Article VI, § 2) because it fails to bear a 'real and substantial relation to the objects sought to be attained.' Studies questioning the existence and impact of a 'malpractice crisis' undermine the justification for the cap, especially the 1986 amendment that extended the cap to all damages (economic and non-economic) without providing a 'commensurate benefit' or quid pro quo to victims. The cap arbitrarily classifies claimants, fully compensating those with damages below $1 million while limiting those with greater injuries. Regarding other certified questions: South Dakota law does not recognize emotional distress or loss of consortium for injuries to a minor child as a separate cause of action for parents. However, the parents' claim for consequential damages (such as medical expenses and loss of services) is a distinct 'action' from the child's claim for their personal injuries, meaning they would be subject to separate damage caps if the statute were constitutional. The question of whether Medical Service Specialists are 'practitioners of the healing arts' is moot given the cap's unconstitutionality.
Concurring - Justice Amundson
Yes, the 1986 cap is unconstitutional because it violates due process. There is no rational or common-sense reason for creating an arbitrary classification of medical malpractice victims, where those with damages of $1 million or less receive full recovery, while more seriously injured victims receive only a percentage of their actual damages. The legislative history for the 1986 amendment, which expanded the cap to all damages, is insufficient to support its necessity in responding to a crisis, especially when compared to the 1976 cap on noneconomic damages. Because the legislation is unconstitutional on due process grounds, it is unnecessary to address the other constitutional challenges. Justice Amundson concurs with Justice Sabers' responses to the other certified questions (3 and 4).
Majority - Justice David Gilbertson
While concurring in the result that the cap is unconstitutional, this opinion delivers the majority reasoning on the rationale for unconstitutionality (substantive due process only) and on the revival of the 1985 version of SDCL 21-3-11, and on question 2. Yes, the 1986 cap on 'total damages' (including economic losses) violates substantive due process because it is an unreasonable, arbitrary, or capricious imposition without a 'real and substantial relation' to a legitimate legislative purpose. While the 1976 cap on noneconomic damages was a rational response to a genuine medical malpractice insurance crisis, the 1986 amendment to include economic damages lacked any similar justification or legislative findings of need. Capping economic damages, such as medical bills and lost wages, arbitrarily burdens the most severely injured without justification. However, the cap does not violate the right to a jury trial or the open courts provision. The jury's function is to find facts and determine damages; the Legislature retains authority to limit remedies, and the cap applies after the jury's verdict. The open courts provision guarantees access to courts and remedy by due course of law, not necessarily full compensation or immutable common law remedies. Because the 1986 amendment is unconstitutional in its entirety, the prior 1985 version of SDCL 21-3-11 (which capped only general/noneconomic damages at $500,000) is revived and remains in full force and effect. The question of whether Medical Service Specialists are 'practitioners of the healing arts' (Question 2) is moot because that language was added in the unconstitutional 1986 amendment, and is not part of the revived 1985 statute. Justice Gilbertson concurs with Justice Sabers' responses to Questions 3 and 4.
Analysis:
This case significantly clarifies the limits of legislative power to modify common law tort remedies under the South Dakota Constitution. It establishes that while the legislature has some authority to address perceived crises through damages caps, such measures must pass a stringent 'real and substantial relation' test, particularly for economic damages. The fragmented opinions highlight the complex interplay between different constitutional rights (jury trial, open courts, due process) and the differing judicial philosophies regarding deference to legislative judgment. The decision also provides important precedent on the revival of prior statutes when subsequent amendments are deemed unconstitutional, impacting how future legislative changes to tort law will be approached and scrutinized.
