Supreme Court Must Resolve Prop. 51 Quandary

Throwing the issue into a quandary that only the California Supreme Court can resolve, the 2nd District Court of Appeal has ruled that Proposition 51, the “deep pockets” initiative, can be applied to cases that were pending when it was passed last June.

The decision Monday directly conflicts with a ruling in September by the 1st District Court of Appeal in San Francisco, which stated that the measure could not be applied retroactively.

Last Oct. 30, the Supreme Court declined to consider an appeal of the San Francisco case, letting it stand as binding for all state court trial judges. The high court, however, left open the possibility that it might later take up a case that raised the question of retroactivity.

Seen as a way to save taxpayers’ money by limiting damage awards paid by cities or counties with “deep pockets,” the law holds each defendant liable for non-economic damages such as pain and suffering only in proportion to the defendant’s degree of fault. Before Proposition 51, defendants were “jointly and severally” liable, meaning one defendant with money could end up paying the total damage award if other defendants were unable to pay.

In ruling that the initiative was constitutional as well as retroactive, the appellate court in Los Angeles upheld the July 17, 1986, decision of Los Angeles Superior Court Judge Bonnie Lee Martin in the civil suit of Gregory Evangelatos, who was blinded at the age of 18 while mixing chemicals for homemade firecrackers.

Trial courts in Los Angeles, Santa Barbara, Ventura and San Luis Obispo counties, which comprise the 2nd District, will be bound by the Evangelatos ruling.

The 12 Northern California counties in the 1st District will be bound by the San Francisco appellate decision against applying the law to cases pending when it was passed. Courts in other counties can use either ruling as their guide.

Several thousand civil cases throughout the state--including 6,000 asbestos injury suits alone--are affected by the retroactivity decisions.

Daniel C. Cathcart, who represents Evangelatos, said he will immediately seek to have the case heard by the state Supreme Court and then the U.S. Supreme Court, if necessary.

“I hope to do my level best to knock the whole thing into a cocked hat (as unconstitutional),” he said. “Prop. 51 is a nightmare and only foments litigation.”

‘Crisis Situation’

Jonathan M. Gordon, a defense attorney for one of the manufacturers of the firecracker chemical, said the initiative was an attempt by voters to remedy a “crisis situation” and was meant to be retroactive.

“The voters wanted new rules to be applied to pending cases immediately,” he said.

Gordon said Evangelatos’ suit will not be tried until the initiative is examined by the state Supreme Court, which he said could occur within a few months. Other attorneys predicted that a decision could take a year or two.

Los Angeles Superior Court Judge Jack Tenner, who has become an adviser to trial judges throughout the state on Proposition 51, titled the Fair Responsibility Act of 1986, hailed Monday’s decision as a way to “expedite” a badly needed review of the law by the state Supreme Court.

Tenner said no retrials of cases are expected because judges had been cautioned last summer to decide whether the initiative applied to each case and to have juries apportion fault and damages to all defendants in the event appellate courts eventually decide that the law is retroactive.

Plaintiffs, bolstered by the California Trial Lawyers Assn., whose members represent them, have argued that the law is not retroactive, hoping to avoid the risk of losing damage awards because a highly liable defendant is unable to pay.

“Quite clearly the voters were sold on the proposition that 51 was for future application. There was no representation at any time that existing cases would be affected by 51,” association President Browne Greene said after Monday’s ruling. “It would be chaos to apply it like that.”

Attempt to Shift Payments

Defendants, on the other hand, have argued for applying the law to all cases pending before last June 4, hoping to shift payment of damages to more liable defendants.

But no one questions that the law applies to suits filed after June 4, some of which may not come to trial for five years.

In the San Francisco case, Justice Harry Low wrote, “There is no clear intent of the electorate for the retroactive application of Proposition 51” and therefore the traditional presumption against retroactive application of a new law applied.

But Monday’s Los Angeles opinion written by Justice Lynn D. Compton, joined by Justices Lester William Roth and Donald N. Gates, stated that Low’s ruling was “unpersuasive” because it “frustrates the legislative will of the voters by postponing effectuation of their decision by several years on average.”

Evangelatos’ attorneys had argued that the new law is unconstitutional because it interferes with the “vested right” to the damages that a person who files a suit can expect, discriminates against poor victims by making litigation too expensive, and takes property from plaintiffs without compensation. They also said the law is unconstitutional because it is vague and because the attorney general’s ballot summary promising “substantial savings to state and local governments” was false and misleading.

The appellate court rejected those arguments as lacking merit or even “frivolous.”