Oregon Liability Cap for Public Employees Ruled Unconstitutional

By | January 9, 2008

The Oregon Supreme Court has ruled that parts of the Oregon Torts Claims Act that limits liability claims against governments violates the Remedy Clause of the Oregon Constitution, creating the potential for liability claims against public employees. The decision also could compel public employees’ agencies, and taxpayers, to pay increased costs related to potential liability claims, the Statesman Journal reported.

In Jordaan Michael Clarke v. Oregon Health Sciences University, Clarke was born in February 1998 at Oregon Health Sciences University with a congenital heart defect. He was admitted to OHSU in May of that year to surgically repair the condition. Following surgery, he was placed in an intensive care unit, where he suffered prolonged oxygen deprivation that caused permanent brain damage.

The brain damage was a direct result of the negligence of OSHU and certain of its employees and agents, the case indicates. So in 2001, the Clarke family brought action against OHSU and against the individuals who treated him, noting expenses for life and health care would amount to $11 million, loss of future earning capacity would be $1.2 million, and non-economic damages amounted to $5 million.

OHSU admitted negligence and moved for judgment on the pleadings in the amount of $200,000, the maximum liability the hospital could face under the Oregon Tort Claims Act.

ORS 30.270 limits the damages recoverable against any public body to “$50,000 to any claimant for any number of claims for damage to or destruction of property; $100,000 to any claimant as general and special damages for all other claims arising out of a single accident or occurrence, unless those damages exceed $100,000, in which case the claimant may recover additional special damages…; and $50,000 for any number of claims arising out of a single accident or occurrence.”

The trial court granted OHSU’s motion and entered judgment against the hospital for $200,000.

The plaintiff appealed, challenging the substitution of OHSU for the individual defendants, and arguing that the amount of $200,000 denied him the right to a remedy, in violation of Article I, section 10 of the state constitution.

The Court of Appeals rejected the plaintiff’s Article I, section 10 argument against OHSU because, it concluded, OHSU would have been immune from liability at common law. However, the court agreed that the plaintiff did not receive a constitutionally adequate remedy in the case, explaining that “recovery of less than 2 percent of one’s economic damages — particularly given the nature of the injuries alleged — is a remedy ‘incapable of restoring the right that has been injured,'” court documents state. The Appeals Court reversed the trial court’s judgment and remanded with instructions to reinstate the claims against the individual defendants.

The defendants subsequently sought the Supreme Court’s review.
The state high court affirmed the Court of Appeals decision.

“We view the plaintiff’s economic damages of over $12 million as representative of the enormous cost of lifetime medical care currently associated with permanent and severe personal injuries caused by the medical negligence of a state officer, agent or employee,” said the opinion.

“The legislature completely eliminated an injured person’s preexisting right to obtain full recovery for those damages from the individual tortfeasors who negligently caused the injuries. … However, there is simply nothing that we can discern from our state’s history, or from the nature, the form or the amount of recovery available for the preexisting common-law claim, that would permit this court to conclude that the limited remedy for permanent and severe injury caused by medical negligence that is now available under the OTCA meets the Article I, section 10, remedy requirement,” the decision states.

However, the court ruled that OHSU could invoke the law that requires governments to insure all their employees against liability claims.

For more information, visit www.publications.ojd.state.or.us/S053868.htm.

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