The return of nuclear verdicts to Texas courts (and attorney television advertising) and the recently launched efforts of the medical malpractice plaintiff’s bar to convince the federal courts to strike down Texas’ cap on noneconomic damages in medical liability cases (which is likely to play out over several years) could potentially raise an issue for state lawmakers: is it time to consider codifying at least some objective standards and levels of proof for mental anguish damages?
This is hardly a question out of left field. Of the 30 tort reform recommendations of January 1987 final report of the House/Senate Joint Committee on Liability Insurance and Tort Law Procedure, number 12 was a $250,000 cap on noneconomic damages. Here is what the committee report said at the time:
Noneconomic damages are, by definition, subjective and nonverifiable. In many cases, they exceed economic damages by a significant amount. Because they are subjective and inherently impossible to predict on a case-by-case basis, they represent a serious impediment to underwriting predictability. A limit on noneconomic damages would make them predictable to the extent that they could not exceed a particular amount. The joint committee believes that a limit of $250,000 allows for the recovery of a substantial amount of money in the event of significant noneconomic injury while still providing for a reasonable degree of civil justice predictability.
Recall that the joint committee made this recommendation in the midst of dramatic changes in Texas law that substantially expanded the availability of noneconomic damages in tort litigation. The Texas Supreme Court made many of these changes by fiat, throwing out well-settled precedent and destabilizing the legal and economic climate. Again, in the words of the committee report, here are a few examples cited by the joint committee that relate specifically to noneconomic damages:
- Madisonville I.S.D. v. Kyle, 658 S.W.2d 149 (Tex. 1983). The supreme court expanded the elements of recoverable damage to include “loss of companionship and society” (separate from past and present “mental anguish”). In doing so, the court established that compensability of two separate types of noneconomic damage that are, in practical fact, intermingled. There is no obvious way to make a perfect and explicable distinction between the psychological pain of “mental anguish” and the pain of “loss of companionship and society.”
- Yowell v. Piper Aircraft, 703 S.W.2d 630 (Tex. 1986). The supreme court for the first time allowed recovery for “loss of inheritance.” The concept of “loss of inheritance” is highly speculative and adds greatly to the unpredictability of the tort system.
- Moore v. Lillebo, 722 S.W.2d 683 (Tex. 1986). The supreme court allowed for the first time recovery mental anguish in a wrongful death case without requiring some sort of physical manifestation. Additionally, the court recognized both mental anguish and loss of companionship and society and as separate injuries for which damages can be recovered. The dissent, by Justice Franklin Spears and joined by Justice Raul Gonzalez, concluded: “With improper definitions, such as the majority’s, mental anguish and loss of society and companionship issues ask jurors the same question: how much emotional distress has the plaintiff suffered? Asked the same question twice, jurors will give the same answer—twice.”
Nothing in the joint committee’s analysis has changed. Noneconomic damages remain “subjective and inherently impossible to predict on a case-by-case basis.” In response to this inherent subjectivity and unpredictability, a full three-fifths of the states, including Texas, have adopted some form of caps on noneconomic damages, whether for general personal injury claims, wrongful death claims, or medical liability claims (or some combination thereof). Several other state legislatures have adopted similar caps, but their state supreme courts have invalidated them on constitutional grounds. While no one argues that caps are the perfect solution, they at least represent a policy decision made by elected representatives (and sometimes, as in Texas, voters as well) after consideration of all relevant factors rather than a small handful of judges based on individual fact situations.
As we recently reported, SCOTX has asked for merits briefing in a case that offers an opportunity for the Court to develop further its noneconomic damages jurisprudence. Gregory v. Chohan, 615 S.W.3d 277 (Tex. App.—Dallas, 2020, pet. pending) once again raises all of the problems with noneconomic damages identified by the 1987 joint committee: subjectivity, unpredictability, presumption of harm vs. hard evidence of harm, and improper jury argument, all of which resulted in a huge jury verdict in this case. It also has a dissenting opinion that echoes Justices Spears’ and Gonzalez’s admonition of the Court in Moore v. Lillebo, which ironically the majority relied on in Gregory to uphold a jury verdict that appears to allow the very double recovery that the dissent in Moore predicted would occur.
The Texas cap on noneconomic damages in medical liability cases works. Health care providers continue to flock to Texas. Texas now has fourteen medical schools located in all regions of the state, training future generations of physicians and making better health care available to every Texan. Access to medical liability insurance at affordable rates has never been better. The settlement value of legitimate cases cannot be grossly inflated by the risk of a nuclear verdict for noneconomic damages. Courts and juries still have the tools to hold truly negligent providers accountable for falling short of the standard of care. Everything that the 2003 Legislature hoped would happen if it adopted the cap has indeed happened. Rarely do major policy decisions involving such big stakes achieve such clear-cut and sustainable success.
Are we advocating the extension of the cap to general tort litigation? In our view, caps have proven to be the most effective single solution and would undoubtedly solve the inherent problems with calculating noneconomic damages, as the 1987 joint committee recommended. But there are other things policymakers could consider to enable a more objective evaluation of claims for noneconomic damages short of a cap. A possible starting place might be the Parkwaystandard articulated by SCOTX, which requires claimants to prove by “direct evidence of the nature, duration, and severity of their mental anguish, thus establishing a substantial disruption in the plaintiff’s daily routine.” In the absence of direct evidence, the court must “determine whether the record reveals any evidence of a ‘high degree of mental pain and distress’ that is ‘more than mere worry, anxiety, vexation, embarrassment or anger.’” This standard carries a number of requirements that could be further elaborated, for example:
- What kind of “direct evidence” must be adduced?
- How should a factfinder measure “nature, duration, and severity”? Must a plaintiff have sought some type of treatment for his or her mental anguish to provide some objective basis for evaluation? How should the factfinder value these elements? What relation do mental anguish damages bear to economic damages? In other words, can the jury assume that a larger amount of economic damages must indicate a larger quantity of mental anguish?
- What constitutes a “substantial disruption in the plaintiff’s daily routine”? Assuming that the plaintiff’s “daily routine” changes by virtue of the plaintiff’s injury alone, how does the factfinder determine the “substantiality” of that change? Assuming also that a “daily routine” may substantially change for reasons other than the plaintiff’s injury, how can the factfinder when considering future mental anguish distinguish between the disruption attributable to the injury and that attributable to other inevitable life changes down the line? Put another way, can “substantial disruption” be permanent or is it necessarily time limited? How does the jury determine that?
- As SCOTX has pointed out, just living in contemporary society carries with it a more or less significant degree of “worry, anxiety, vexation, embarrassment or anger.” The level to which individuals register these emotions is highly contingent and depends on a multitude of internal and external factors, including the plaintiff’s personal and family history and belief system, health conditions and access to appropriate health care, employment history, education and socioeconomic levels, and whole lot of other things. In the absence of direct evidence, how can the factfinder distinguish between a “normal” degree of “worry, etc.” and a “high” degree? Does that test throw the jury back on the problem of “substantial disruption”? Does it all come down to the jury pulling a number out of the air because it has no other solid basis for valuing the actual injury (suggested by the great disparity in mental anguish awards for similar injuries, as Justice Schenk points out in his dissent in Gregory)?
The Parkway test, however, is only a part of the problem. Gregory, for example, features a plaintiff’s jury argument that mental anguish damages could be based on assigning a certain monetary value per mile annually driven by the defendant employer’s trucks sufficient to send the employer a “message” about its training and supervision of drivers. “Sending a message” sounds like a phrase associated with punitive damages, not noneconomic damages. Perhaps that is one reason the Legislature saw fit to cap on punitive damages in 1995—might it be an equally good reason to do it for noneconomic damages as well? Again, short of a cap, at least some guardrails could be placed around the permissible arguments the jury can hear without contaminating it with inflammatory suggestions with no basis in the plaintiff’s actual harm.
Another problem foregrounded in Gregory is the standard of “meaningful review” of mental anguish damages award. The existing standard seems to be no standard at all, merely referring to an award that “shocks the conscience” of the court. In his landmark opinion in Transportation Ins. Co. v. Moriel, 879 S.W.2d 10 (Tex. 1994), Justice Cornyn lamented the lack of procedural safeguards in reviewing an award of punitive damages and directed appellate courts to “carefully scrutinize punitive damages awards to ensure that they are supported by the evidence.” To that end, appellate courts must “detail the evidence in their opinions and explain why the jury’s finding is either factually sufficient or insufficient to support the award. It appears that most, if not all, courts of appeals’ opinions that consider the factual sufficiency of an award of mental anguish damages make at least some effort to detail the relevant evidence, but they lack the specific factors pronounced in Alamo Nat. Bank v. Kraus, 616 S.W.2d 908 (Tex. 1981) that Texas courts use to review the reasonableness of punitive damages awards. Again, the inherent subjectivity that makes mental anguish damages so hard to quantify makes it difficult to conceive the specificity of the Kraus factors, but might something similar be codified here?
As Justice Campbell wrote in Kraus, “[F]actors to consider in determining whether an award of exemplary damages is reasonable include (1) the nature of the wrong, (2) the character of the conduct involved, (3) the degree of culpability of the wrongdoer, (4) the situation and sensibilities of the parties concerned, and (5) the extent to which such conduct offends a public sense of justice and propriety.” Might something similar be adapted to provide “meaningful review” of an award of mental anguish damages beyond the “shock the conscience” standard? The Kraus standards attempt to combine both subjective and objective components to quantify the harm done by the defendant to both the plaintiff and the “public.” Of course, keep in mind that review of punitive damages takes place in the context of their deterrence and retribution functions, whereas mental anguish damages, in addition to economic damages, seek “to make the plaintiff whole.” And as previously mentioned, the 1995 caps on punitive damages have supplanted much of the “judgment call” effect of the Kraus factors and substituted a collective policy decision for a judicial one. Leaving aside whether it is even possible for any amount of mental anguish damages to do make anyone “whole,” could we at least look at some more objective requirement of proportionality?
Taking personal injury or wrongful death cases out of the equation for a moment, it is an unfortunate fact of life that people get cheated and taken advantage of all the time. It’s no fun when it happens to you and likely causes a level of aggravation and disruption that nobody wants to live with for very long. When considering the dollar value of such aggravation and disruption to an individual claimant, could some version of the harm to the “public” factors in Krauswork here? How much aggravation and disruption would a reasonable person suffer under the same circumstances? Did the defendant act negligently or with a “higher degree of culpability”? Does the plaintiff’s resort to litigation indicate a rational decision that may actually mitigate his or her aggravation and disruption (aside from that generated by the litigation process itself, to which mental anguish damages do not attach)? After all, the ability of private parties to seek justice in our courts is specifically designed to lower the temperature and relieve the stress of civil disputes on society and, ultimately, the individuals involved. Put another way, should the positive benefits of civil litigation as a means of resolving such disputes be recognized in some way in assessing the harm in an individual case?
Justice Schenk provides an extensive analysis of similar cases in reaching his conclusion that the amount of mental anguish award determined by the jury and affirmed by the majority had no basis in the evidence. This raises the question: should the outcomes of similar cases be used to formulate a “normalized” range of mental anguish damages that can at least inform the jury of what other juries have done (they might certainly be relevant to establishing a cap, which is another way of normalizing damages) and assist the reviewing court? Those outcomes could also be used to derive more specific categories of direct evidence that must be adduced to justify an award and to help determine whether some types of direct evidence, such as the testimony of an expert or other third party explaining how the plaintiff’s harm meets the Parkway standard, might be required to reach a certain compensability threshold. Such a bifurcation would recognize the existing rule that a jury may consider harm to a close family member as some evidence of mental anguish but such harm cannot itself be the basis of an award in excess of a certain level. In other words, one could normalize the amount of mental anguish suffered by an ordinary person under those circumstances, even with a cap, and require much more intensive proof to justify an award exceeding that amount.
Although anathema in some quarters to bring it up, in Moore Justice Spears admonished the Court for eliminating the physical manifestation requirement for the recovery of emotional damages in wrongful death cases. As Justice Spears pointed out,
[T]he physical manifestation requirement serves three important and related purposes besides preventing fraud. First, the requirement assures that the emotional injury reaches a compensable level. Mere sorrow, anger, worry, or fear have not been and should not be compensable. [citations omitted] Our society has neither the financial nor judicial resources to allow recovery for ordinary grief and sorrow. With a physical manifestation requirement, at least the emotional injury must be severe enough to manifest itself in objective physical symptoms.
Second, the physical manifestation requirement serves to define mental anguish as severe emotional distress. By abandoning both the physical manifestation requirement and the bystander’s requirement, the majority’s standard for mental anguish is so weak as to be meaningless.
Third, and most importantly, the requirement serves to separate mental anguish from loss of society and companionship. Without the requirement, loss of society and companionship damages and mental anguish damages overlap, resulting in double recovery.
While in Parkway SCOTX attempted to address some of the problems Justice Spears identified, the absence of a physical manifestation requirement to recover mental anguish damages leaves them entirely in the eye of the beholder and susceptible to the kind of improper jury argument we see in Gregory. It does not seem unreasonable that proof of mental anguish beyond the emotions cited by Justice Spears should require some medical diagnosis of a physical or psychological reaction. Justice Spears suggested that the jury charge should define mental anguish as “an intense emotional injury, resulting in depression or other physical reactions. Exclude ordinary grief and sorrow.” This seems to us a good starting place for raising the level of proof required to justify a Gregory-type verdict.
Justice Spears further suggested a distinct definition of loss of society and companionship as an “injury to the familial relationship from the loss of the deceased’s affection, comfort, assistance, and companionship.” Sufficient evidence to show this element of damages should involve more detailed and corroborative accounts of the familial relationship as it actually existed at the time of the loss. As Justice Spears aptly noted, “[N]ot all family members have relationships. Nonetheless, claimants can submit both issues without proof of a close (or even any) relationship to the deceased. No matter how little the evidence of their emotional distress, the following claimants may now submit both issues: parents who have abandoned their children, spouses who have lived apart for years, and children who have never lived with a parent.” Again, though Parkway introduced a “nature, duration, and severity” causing a “substantial disruption of the plaintiff’s daily routine” standard, it did not offer much in the way of guidance as to the intensity of the evidence required to transcend the “ordinary” emotions of grief, loss, sorry, anger, etc. While it is certainly difficult to get to the bottom of actual family relationships in any context, much less litigation, some assessment should be made before the public is charged with the cost of a Gregory-type verdict through, in this case, added insurance and shipping costs. This is the kind of balancing test intended by the Kraus factors. We need something similar here.
Finally, it might be advisable to revisit the definition of “noneconomic damages” in §41.001(12), CPRC. Noneconomic damages means “damages awarded for the purpose of compensating a claimant for physical pain and suffering, mental or emotional pain or anguish, loss of consortium, disfigurement, loss of companionship and society, inconvenience, loss of enjoyment of life, injury to reputation, and all other nonpecuniary losses of any kind other than exemplary damages.” Are all of these elements truly distinct and separable? We’ve already discussed the basis of distinguishing between mental anguish and loss of companionship and society. Beyond that, doesn’t “mental or emotional pain or anguish” necessarily involve a “loss of enjoyment of life”? How does loss of consortium really differ from loss of companionship and society? What is the relationship between “disfigurement” and mental anguish? What does “inconvenience” mean? What “other” nonpecuniary losses does the definition contemplate? Can more than one of these elements be established using the same evidence? Is there any chance a juror can isolate these elements and determine which evidence attaches to each one?
As we began this analysis (a long time ago, it seems), we cited the 1987 joint committee report’s findings that certain decisions of SCOTX contributed substantially to the serious imbalances in the civil justice system that the report’s recommendations sought to remedy. Prominent among them were decisions throwing out well-settled Texas law and multiplying the types of recoverable noneconomic damages. The definition given by §41.001(12) effectively codified these decisions. Clearly, this definition reflects one compromise inside of a complex combination of compromises that produced the 1995 reforms. But that should not foreclose the Legislature, if it so chooses, from revisiting the definition in light of the development of the law since that time and the problems we see emerging in Gregory and similar cases. While we are not necessarily advocating a legislative response at this time, we do believe that the rising incidence of nuclear verdicts and challenges to the existing cap warrant a policy response.