Oregon Case Law Update: Oregon Court of Appeals Takes a Swipe at the Statutory Cap on Non-Economic Damages

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Oregon Case Law Update: Oregon Court of Appeals Takes a Swipe at the Statutory Cap on Non-Economic Damages

From the desk of Jeff Eberhard: In 1987, the Oregon legislature enacted a limit of $500,000 for noneconomic damages.  In a number of court decisions over a 15-year time period, the Oregon Supreme Court held that this limitation violated the Oregon Constitution.  Then, in May 2016, in Horton v. OHSU the Oregon Supreme Court held that two “linchpin” cases were decided incorrectly, and breathed new life into Oregon’s $500,000 limit on noneconomic damages.  In the following case, the Oregon Court of Appeals finds that in certain situations the damages cap is unconstitutional under the remedies clause in Article I, Section 10.  Read on for a discussion on the Court’s analysis and to learn how courts evaluate whether legislation violates the remedy clause.

Claims Pointer: In 2016, the Oregon Court of Appeals held that the $500,000 noneconomic damages cap in ORS 31.710(1) violates a plaintiff’s right to a jury trial under Article I, section 17 of the Oregon Constitution. In support of its decision, the court relied extensively on Lakin v. Senco Products, Inc., a case decided by the Oregon Supreme Court in 1999. Interestingly, just one day after the Court of Appeals issued its decision, the Oregon Supreme Court in Horton v. OHSU overruled Lakin. In their opinion the Oregon Supreme Court in Horton eliminated any argument that the cap violated Article I, Section 17.

On reconsideration, the Oregon Court of Appeals held that the noneconomic damages cap in ORS 31.710(1) violates the remedy clause of Article I, section 10. The court explained that the noneconomic damages cap in ORS 31.710(1) does not violate the remedy clause in all cases. Instead, where the noneconomic damages cap of $500,000 leaves plaintiffs with a “paltry fraction” of the original noneconomic damage award, the reduction will be found to leave plaintiffs with an...

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