Wednesday, June 6, 2018

Why “Quid Pro Quo” Unconstitutionality Arguments Work Better in Some States than Others

Quid pro quo” arguments resonate more forcefully in Kansas and Florida than in many other states, and there is a state constitutional doctrinal reason why this is so. 

By quid pro quo, I mean the idea that legislatures abolished workers’ rights to civil negligence law suits in exchange for reasonable or adequate workers’ compensation benefits. The workers got “this for that” (the literal translation of quid pro quo). The employers, of course, gave up common law defenses (the unholy trinity) in exchange for tort immunity. That was their “this for that.” A theory exists that if the “quid pro quo” is undone there has been a breach of the deal, and that constitutional infirmity somehow ensues. (I hold the theory in somewhat modified form). The theory makes sense, but surprisingly enough, under both federal and state constitutional law, it is murky as to whether a constitutional violation results from such a breach. The strongest support for the theory would be if the negligence action the worker gave up was itself constitutionally grounded. I have written at some length on this issue (see the link below) and suffice it to say that, as a matter of federal constitutional law, I think the proposition is on shaky ground. It does not help that the U.S Supreme Court has been aggressively uninterested in considering the interplay of state workers’ compensation law and the 14th Amendment. (I suspect that is the ultimate reason the Court did not take up the carriers’ invitation, in American Insurance Carriers et al. v. New York et al., to review the challenge by multiple insurance carriers to the closure of the New York Special Fund for Reopened Cases: Extreme caution in identifying any federal constitutional interest in a state workers’ compensation case.

Thus, the quid pro quo argument—that a state legislature violates the constitution by arbitrarily taking back what it originally promised in exchange for a (fundamental? important?) negligence right—could probably only gain traction in a state supreme court. “Can the legislature really do that?” Such constitutional litigation raises issues very similar to those arising when a legislature attempts to limit or even eradicate tort damages (e.g., in medical malpractice or noneconomic damages). “Can a legislature really do that?” There are essentially three approaches courts have taken when seeking to answer questions of personal injury rights (including workers’ compensation) reduction: a historically tied approach, a “reasonable alternative” public policy approach, and a legislative power approach.

1).        A historically tied approach holds that relevant state constitutional provisions, like right to remedies and open courts provisions, protect only common law causes of action that existed at the time of the adoption of the relevant constitutional clause. Those causes of action are preserved unless the legislature substitutes another adequate remedy or “quid pro quo” for the affected litigants. This is really the only kind of approach that is necessarily responsive to workers’ compensation claimants’ quid pro quo arguments.

2).        A public policy approach permits the legislature to limit any cause of action and remedy if it creates a reasonable alternative, but, even without creating a substitute, it may alter former rights if it acts for a very important reason or is responding to an overwhelming public need. Under this approach, a state government has an “out” for not providing a reasonable alternative to a cause of action and remedy, but, from the plaintiff’s point of view, and unlike upcoming approach 3, the state must at least establish that it is for a very important reason or is responding to an overwhelming public need. Workers’ compensation claimants’ have a better opportunity to attack workers’ compensation provisions in a state that uses this approach, but not as good a chance as with approach 1.

3).        A third theory allows legislatures the broadest power to alter common law rights and remedies by redefining the notion of legal injury. This theory is sometimes known as “legislative supremacy.” Workers’ compensation claimants have almost no chance of prevailing on a quid pro quo theory in a state using this approach. Just as a state had plenary authority to enact workers’ compensation in the first place, the argument goes, so it has plenary authority to modify workers’ compensation in essentially any way it likes.

You can probably tell from this scheme (you can reader a fuller exposition and some supporting citations here at pp. 168-172), that the success of quid pro quo litigation will depend heavily on a state’s constitutional law doctrine. You may also have discerned that the reason that quid pro quo litigation has been successful in Florida and Kansas is that their state courts employ a variation of approach 1 or 2, above. In Kluger v. White, a 1970s-era Florida personal injury case, the Florida Supreme Court said,

Where a right of access to the courts for redress for a particular injury has been provided by statutory law predating the adoption of the [1968] 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 . . . 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.

Thus, in a very significant way, negligence actions have been constitutionalized in Florida. A legislature cannot extinguish a negligence right (or eviscerate the workers’ compensation substitute for the right) unless it “can show an overpowering public necessity for the abolishment of such right, and no alternative method of meeting such public necessity can be shown.” Any wonder why plaintiffs can win in Florida?

Consider the situation in Kansas, which just recently played out again this week in Pardo v. United Parcel Service. Here is the shortest version of the story I can tell. Kansas uses the 6th Edition of the American Medical Association Guides to Permanent Impairment as a proxy for “disability” (some might say slavishly). Pardo received an award for a 2013 shoulder injury. He injured the same shoulder in 2015, but in a separate location in the shoulder. The injury was clear. But the 6th Edition of the AMA Guides dictated no additional disability compensation. The agency did not appear to be fully on board with the determination: it would leave Pardo with no remedy for his injury. But it was (as it is in many states) beyond the agency’s mandate to rule on the constitutionality of the application of the Guides. You know the question: Can the legislature do that? No, as it turns out, because the quid pro quo is built directly into the Kansas constitution under a long string of authority. See if you recognize the analysis (internal citations omitted):

If a remedy protected by due process is abrogated or restricted by the legislature, such change is constitutional if [1] the change is reasonably necessary in the public interest to promote the general welfare of the people of the state, and [2] the legislature provides an adequate substitute remedy to replace the remedy which has been restricted.

The case was remanded. We will see if it is appealed.

There are several states where quid pro quo constitutional arguments may work, either because approach 1, above, has been adopted or because no clear approach has yet been articulated. But it is easy to identify those states where the arguments will almost certainly not work. Just read the constitutional tort reform cases in your state. If you discern approach 3, you have your answer.

Michael C. Duff

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