MARGARET PHILLIPS V MIRAC INC
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Michigan Supreme Court
Lansing, Michigan
Opinion
Chief Justice
Justices
Maura D. Corrigan
Michael F. Cavanagh
Elizabeth A. Weaver
Marilyn Kelly
Clifford W. Taylor
Robert P. Young, Jr.
Stephen J. Markman
FILED JULY 6, 2004
MARGARET PHILLIPS, PERSONAL REPRESENTATIVE
OF THE ESTATE OF REGEANA DIANE HERVEY,
Deceased,
Plaintiff-Appellant,
v
No. 121831
MIRAC, INC.,
Defendant-Appellee.
_______________________________
BEFORE THE ENTIRE BENCH
TAYLOR, J.
In this case, we granted leave to appeal to consider
whether MCL 257.401(3), which caps the amount of a lessor’s
liability in motor vehicle leases of thirty days or less,
violates plaintiff’s rights under the Michigan Constitution
to a jury trial,1 equal protection,2 or due process.3
1
Const 1963, art 1, § 14.
2
Const 1963, art 1, § 2.
3
Const 1963, art 1, § 17.
We
hold that this damages cap does not implicate plaintiff’s
right to a jury trial, and does not violate her rights to
equal protection or due process.
Court
of
Appeals
decision
Therefore, we affirm the
that
the
statute
is
constitutional.
I
Regeana Diane Hervey died in an automobile accident
while a passenger in a vehicle being driven by Da-Fel Reed.
Reed had leased the vehicle from Mirac, doing business as
Enterprise
mother
and
Rent-A-Car.
the
personal
Margaret
Phillips,
representative
of
decedent’s
decedent’s
estate, initiated a lawsuit against Mirac on the basis of
MCL
257.401(3).4
Generally,
MCL
257.401(3)
establishes
vicarious liability for automobile lessors when permissive
users, such as Reed, are negligent and cause automobile
accidents injuring others.
The act also caps the damages
for such lessors at $20,000 for each injured person to a
maximum of $40,000 for each accident.
While reserving for resolution the constitutionality
of the damage caps, the parties before trial executed a
“high-low” agreement for a $150,000 minimum award and a
4
Reed also was sued.
A jury found her negligent;
however, she is not a party to this appeal.
2
$250,000 maximum award.
The jury returned a verdict of
$900,000 against Mirac.
This would, of course, have been
reduced
to
$250,000
pursuant
to
the
high-low
agreement,
unless the statutory damage caps were constitutional, in
which case the damages would be reduced to $20,000.
The trial court concluded that the damage caps were
unconstitutional on the basis that the statute,
in capping
damages, violated the right of trial by jury found in art
1, § 14 of the Michigan Constitution.
The essence of its
holding was that the right of jury trial includes the right
of having a jury not only determine damages, but that the
jury’s determination cannot be altered by the Legislature
or courts.
violated
The trial court also concluded that the statute
provision
that
guarantees to citizens equal protection of the laws.5
That
is,
that
litigants
the
Michigan
it
to
Constitution’s
impermissibly
be
treated
causes
differently.
similarly
Using
situated
the
same
reasoning, the trial court concluded that the statute also
violates
the
Michigan
Constitution’s
process of law.6
5
Const 1963, art 1, § 2.
6
Const 1963, art 1, § 17.
3
guarantee
of
due
On appeal, the Court of Appeals reversed in a two-to
one opinion.7
infringe
plaintiff’s
reasons.
modify
The majority determined that the cap did not
right
to
trial
by
jury
for
two
First, because the Legislature can abolish or
common-law
necessarily
and
follows
statutory
that
it
rights
can
recoverable for a cause of action.
and
limit
remedies,
the
it
damages
Second, it decided that
the statute does not infringe the right to a jury trial
because the damages cap does not remove from the jury the
determination of facts and amount of damages.
The statute
simply limits the amount of damages that can be recovered
from a lessor of vehicles.
Thus, the cap only limits the
legal consequences of the jury’s finding.
251 Mich App at
590-595.
Therefore,
implicate
whether
any
the
having
determined
fundamental
cap
violates
right,
that
the
the
majority
plaintiff’s
cap
right
protection under the rational basis test.
did
not
analyzed
to
equal
The majority
concluded that “it can reasonably be assumed that Michigan
has a legitimate interest in the continued operation of
automobile
rental
businesses,
and
protecting
those
businesses from large damages awards in jury trials bears a
7
251 Mich App 586; 651 NW2d 437 (2002).
4
rational
relationship
to
that
end.”
Id.
at
598.
Therefore, the statute did not violate plaintiff’s equal
protection rights.
Similarly, because the tests for due
process and equal protection are essentially the same, the
cap also did not violate plaintiff’s due process rights.
Id. at 598.
The Court of Appeals dissent would have held that the
damages
right
cap
to
a
is
unconstitutional
jury
trial.
The
because
dissent
it
violates
explained
the
that
“[b]ecause our constitution confers a right to trial by
jury, and because the right to trial by jury in Michigan
extends to a determination of damages, the damages cap in
the instant case is unconstitutional.”
Id. at 599.
Thus,
the statutory damages cap renders the jury’s role illusory.
The dissent stated that the Legislature may be free to
abolish a cause of action, but it may not abolish a right
mandated by the Constitution.
Id. at 600.
This Court granted plaintiff’s application for leave
to appeal, “limited to whether MCL 257.401(3) constitutes
an unconstitutional denial of plaintiff’s right to a jury
trial, equal protection, or due process.”8
8
468 Mich 943 (2003).
5
II
When construing a constitutional provision, we must
give the words their plain meaning if they are obvious on
their face.
“If, however, the constitutional language has
no plain meaning, but is a technical, legal term, we are to
construe
those
words
in
their
technical,
legal
sense.”
Silver Creek Drain Dist v Extrusions Div, Inc, 468 Mich
367, 375; 663 NW2d 436 (2003); Michigan Coalition of State
Employee Unions v Civil Service Comm, 465 Mich 212, 222
223; 634 NW2d 692 (2001), quoting 1 Cooley, Constitutional
Limitations (8th ed), p 132.
The constitutionality of a statute is a question of
law that is reviewed de novo.
Tolksdorf v Griffith, 464
Mich 1, 5; 626 NW2d 163 (2001).
Statutes are presumed
constitutional.
We exercise the power to declare a law
unconstitutional
with
extreme
caution,
and
we
never
exercise it where serious doubt exists with regard to the
conflict.
Sears
v
Cottrell,
5
Mich
251,
259
(1858);
accord, Taylor v Gate Pharmaceuticals, 468 Mich 1, 6; 658
NW2d
127
(2003).
“Every
reasonable
presumption
or
intendment must be indulged in favor of the validity of an
act, and it is only when invalidity appears so clearly as
to leave no room for reasonable doubt that it violates some
provision of the Constitution that a court will refuse to
6
sustain its validity.” Cady v Detroit, 289 Mich 499, 505;
286 NW 805 (1939).
III
The
statute
at
issue
in
this
case,
MCL
257.401,
provides in part:
(3) Notwithstanding subsection (1), a person
engaged in the business of leasing motor vehicles
who is the lessor of a motor vehicle under a
lease providing for the use of the motor vehicle
by the lessee for a period of 30 days or less is
liable for an injury caused by the negligent
operation of the leased motor vehicle only if the
injury occurred while the leased motor vehicle
was being operated by an authorized driver under
the lease agreement or by the lessee's spouse,
father, mother, brother, sister, son, daughter,
or other immediate family member. Unless the
lessor, or his or her agent, was negligent in the
leasing of the motor vehicle, the lessor's
liability under this subsection is limited to
$20,000.00 because of bodily injury to or death
of 1 person in any 1 accident and $40,000.00
because of bodily injury to or death of 2 or more
persons in any 1 accident. [Emphasis added.] [9]
9
Subsection 1 of the statute provides:
This section shall not be construed to limit
the right of a person to bring a civil action for
damages for injuries to either person or property
resulting from a violation of this act by the
owner or operator of a motor vehicle or his or
her agent or servant. The owner of a motor
vehicle is liable for an injury caused by the
negligent operation of the motor vehicle whether
the negligence consists of a violation of a
statute of this state or the ordinary care
standard required by common law. The owner is not
liable unless the motor vehicle is being driven
with his or her express or implied consent or
(continued…)
7
Thus, this statute imposes on a motor vehicle lessor
vicarious liability for bodily injury or death resulting
from the negligence of the lessee (or a listed member of
the lessee’s family).
limits
on
that
The statute, however, sets upper
vicarious
liability
in
the
amounts
of
$20,000 for each person and $40,000 for each accident.
The Michigan Constitution states that:
The right of trial by jury shall remain, but
shall be waived in all civil cases unless
demanded by one of the parties in the manner
prescribed by law. [Const 1963, art 1, § 14.]
At
issue
is
whether
this
constitutional
provision
makes what the Legislature attempted to do—cap damages even
though a jury found that the damages were greater than the
cap—unconstitutional.
That
is,
does
MCL
257.401(3)
unconstitutionally infringe the right of trial by jury?
The first step in our analysis is to identify the
scope of the right as enumerated in the Constitution.
Our
Constitution from the time of statehood has had a provision
concerning the right of jury trials.
In its earliest form,
(…continued)
knowledge. It is presumed that the motor vehicle
is being driven with the knowledge and consent of
the owner if it is driven at the time of the
injury by his or her spouse, father, mother,
brother,
sister,
son,
daughter,
or
other
immediate member of the family. [MCL 257.401(1).]
8
the right was expressed in Const 1835, art 1, § 9: “The
right of trial by jury shall remain inviolate.”
This was
changed somewhat by Const 1850, art 6, § 27: “The right of
trial
by
jury
shall
remain,
but
shall
be
deemed
to
be
waived in all civil cases unless demanded by one of the
parties in such manner as shall be prescribed by law.”
This language was unchanged in Const 1908, art 2, § 13, and
the 1963 Constitution did not change the substance but only
updated the language slightly.
As can be seen, we have had
virtually the same provision in our Constitution throughout
our history and the nub of our inquiry must be, then, what
does it mean to say “the right of trial by jury shall
remain”?
This Court, speaking through Justice Thomas M. Cooley
addressed this in 1880, saying:
The Constitution of the State provides that
‘The right of trial by jury shall remain, but
shall be deemed to be waived in all civil cases,
unless demanded by one of the parties in such
manner as shall be prescribed by law.’ Article
vi. § 27. The right is to remain. What right?
Plainly the right as it existed before; the right
to a trial by jury as it had become known to the
previous jurisprudence of the State.
[Swart v
Kimball, 43 Mich 443, 448; 5 NW 635 (1880)
(emphasis in original).]
What is to be taken from this is that to determine
what
this
phrase,
“the
right
of
trial
by
jury
shall
remain,” means, one must look to the jurisprudence of the
9
state.
That is, this phrase is a technical legal phrase
with the meaning those understanding the jurisprudence of
this
state
would
give
it.
As
we
said
in
Michigan
Coalition, supra at 223, drawing on Justice Cooley’s method
of analysis, in construing technical legal terms used in a
constitution, “we must suppose these words to be employed
in
their
technical
Limitations, supra.
sense.”
Quoting
Constitutional
It is this technical legal meaning
that the ratifiers of the 1963 Constitution are held to
have adopted.
We thus must look for the meaning of “the
right of trial by jury” before 1963, as understood by those
learned in the law at the time.
See Conservation Dep’t v
Brown, 335 Mich 343, 346; 55 NW2d 859 (1952).
Considerable insight into this scope of this right,
both historically and as it was understood in the first
half
of
the
twentieth
century,
is
provided
in
the
encyclopedic article on this issue in the 1918 Harvard Law
Review by Harvard Law professor Austin Wakeman Scott, Trial
by jury and the reform of civil procedure, 31 Harv L R 669
(1918).
While,
certain
elements
“essence”
of
not
surprisingly,
to
have
trial
by
long
Professor
been
jury,
regarded
such
as
Scott
as
found
of
the
unanimity,
impartiality, and competence of the jury, id. at 672-674,
he also found that the only matters “properly within the
10
province of the jury” are questions of fact.
Id. at 675.
All other questions, being questions of law, are for the
court.
Id. at 677.10
Professor Scott’s article served as
the bedrock for the United States Supreme Court decision,
Tull v United States, 481 US 412; 107 S Ct 1831; 95 L Ed 2d
365 (1987), in which the Court discussed these concepts and
concluded that the jury was confined to finding facts and
that law was for the courts and, moreover, that falling
within
the
penalties.
ambit
of
law
was
the
assessment
of
civil
As the Court said, “The assessment of civil
penalties thus cannot be said to involve the ‘substance of
a common-law right to a trial by jury,’ nor a ‘fundamental
10
That this view is accurate seems incontrovertible
when the scholarly Scott article is read, and it is
reinforced by the most renowned commentator on the English
common law in the eighteenth century, William Blackstone,
who noted that the jurors “are judges of fact.”
3 Comm
361, reprinted in 5 Kurland & Lerner, The Founder’s
Constitution 345 (1986), and even Thomas Jefferson, who was
famously no friend of government officials decimating the
power of the common people: “. . . JURIES therefore . . .
determine all matters of fact, leaving to the permanent
judges to decide the law resulting from those facts.”
Thomas Jefferson to the Abbé Arnoux, July 19, 1789,
reprinted in Kurland & Lerner, supra at 364. These ancient
references concerning the status of the common law before
Michigan’s statehood are significant because in our
earliest Constitution, by way of the ordinances of 1787 for
the government of the Northwest Territory, we adopted what
was in essence the English common law in existence on that
date. See In re Sanderson, 289 Mich 165, 174; 286 NW 198
(1939); In re Lamphere, 61 Mich 105, 108; 27 NW 882 (1886);
Stout v Keyes, 2 Doug 184 (Mich 1845).
11
element of a jury trial.’”
Tull, supra at 426.
This
holding in Tull was not unexpected because it followed a
similar holding in Galloway v United States, 319 US 372,
392; 63 S Ct 1077; 87 L Ed 1458 (1943), in which the Court
opined
that,
as
expressed
in
the
United
States
Constitution, the right of trial by jury extends only to
“its
most
fundamental
elements,
not
the
great
mass
of
procedural forms and details . . . .”
No other understanding of the proper area for juries
to exercise power can be found in Michigan jurisprudence.
In 1962, in deciding McClelland v Scholz, 366 Mich 423,
426; 115 NW2d 120 (1962), the Court found unexceptional a
court rule that required juries to decide questions that
relate “only to material issues of fact,” a finding that
the Court could not have reached had the rule breached the
“right
of
Constitution.
trial
by
Moreover,
jury”
this
provision
approach
in
echoed
the
a
1908
similar
earlier holding in May v Goulding, 365 Mich 143, 148-149
(1961).
Further, in giving an overview of the area of the
law in 1994, this Court held: “Juries traditionally do not
decide the law or the outcome of legal conflicts. . . . To
maintain the traditional role of the jury, the jury must
remain the factfinder; a jury may determine what happened,
how, and when, but it may not resolve the law itself.”
12
Charles Reinhart Co v Winiemki, 444 Mich 579, 601; 513 NW2d
773 (1994).
It
is
clearly
the
case
that,
at
the
time
of
the
drafting and ratification of the 1963 Constitution, those
sophisticated
instrument
in
the
adopted,
law
that
understood,
the
right
of
and
thus
trial
the
by
jury
encompassed a jury that could find facts, including the
amount of damages.
See, e.g., Wood v Detroit Automobile
Inter-Ins Exchange, 413 Mich 573, 583-584; 321 NW2d 653
(1982).
to
However, regarding the law, it was for the court
decide
that
on
the
basis
of
the
common
law,
the
Constitution, or the statutes the Legislature had enacted.
This
should
importance.
not
be
taken
as
dismissing
the
jury’s
It is for the jury to assimilate the facts
presented at trial, draw inferences from those facts, and
determine what happened in the case at issue.
See, e.g.,
Green v Detroit U R Co, 210 Mich 119, 129; 177 NW 263
(1920).
As important as those duties are, however, matters
of
concern
law
Accordingly,
the
excluded
legal
from
significance
the
jury’s
of
those
purview
facts.
are
such
matters as whether a party has met its burden of proof,
whether certain evidence may be considered, which witnesses
may testify, whether the facts found by the jury result in
a party being held liable, and the legal import of the
13
amount of damages found by the jury.11
Thus, for example,
while a jury may find a defendant has acted negligently and
the amount of damages occasioned thereby, the court may
apply the governmental immunity act, MCL 691.1407, and find
there is no liability, despite the plaintiff’s damages.
Or
a jury may find a hunter has been injured and damaged on a
defendant’s property because of the defendant’s negligence,
but the recreational trespass act, MCL 324.73107, will, in
certain
circumstances,
uncontroversially,
preclude
after
the
liability.
jury
has
been
Moreover,
dismissed,
a
court may enter an order that doubles or trebles the amount
of
damages
assessed,
pursuant
to
any
of
the
numerous
11
See Etheridge v Med Ctr Hosps, 237 Va 87, 96; 376
SE2d 525 (1989), in which the Supreme Court of Virginia
noted:
“The province of the jury is to settle
questions of fact, and when the facts are
ascertained the law determines the rights of the
parties.” . . . Once the jury has ascertained the
facts and assessed the damages, however, the
constitutional mandate is satisfied. Thereafter,
it is the duty of the court to apply the law to
the facts.
[Quoting WS Forbes & Co v Southern
Cotton Oil Co, 130 Va 245, 260; 108 SE 15
(1921)(citations deleted).]
The United States Court of Appeals for the Fourth
Circuit has reached the same conclusion: “[O]nce the jury
has made its findings of fact with respect to damages, it
has fulfilled its constitutional function; it may not also
mandate compensation as a matter of law.”
Boyd v Bulala,
877 F2d 1191, 1196 (CA 4, 1989).
14
statutes that concern postverdict adjustment of damages.12
In many ways this parallels the criminal system.
While the
jury is to find the facts, the court defines the crime and
determines the sentence along with any fees or fines to be
imposed on the basis of the guidance and requirements set
forth by the Legislature.
The damage cap is of a piece
with these numerous examples that for generations have not
been successfully challenged on the basis of constitutional
infirmity
and
understanding
that
reflect
springing
the
previously
a
recognition
from
unchallenged
that
juries
decide only facts.
Thus we conclude that the damages cap contained in MCL
257.401(3)
does
not
offend
the
constitutional
right
of
trial by jury because the amount the plaintiff actually
receives was never within those things a jury can decide.
12
Statutes doubling or trebling damages include MCL
125.996, 230.7, 257.1336; statutes that set a minimum
recoverable amount include MCL 14.309, 339.916, 445.257,
445.911, 550.1406; statutes that provide for adding costs,
fees, interest or penalties to awards include MCL 35.462,
125.1449m; court-determined remittitur and additur is
provided for in MCR 2.611(E); and postverdict reduction of
awards to present value is permitted by MCL 600.6306(1)(c).
“[T]he practice of awarding damages far in excess of actual
compensation for quantifiable injuries was well recognized
at the time the Framers [of the United States Constitution]
produced the Eighth Amendment [relating to excessive bail,
fines, or cruel or unusual punishment].”
Browning-Ferris
Ind of Vermont, Inc v Kelco Disposal, Inc, 492 US 257, 274;
109 S Ct 2909; 106 L Ed 2d 219 (1989).
15
Damage
caps
are
constitutional
in
causes
of
action
springing out of the common law because the Legislature has
the
power
under
our
Constitution13
to
abolish
nonvested, common-law rights and remedies.
or
modify
Donajkowski v
Alpena Power Co, 460 Mich 243, 256 n 14; 596 NW2d 574
(1999).
the
The case is even more convincing when, as here,
liability—an
owner’s
liability
for
the
negligent
driving of a permissive user—is a statutory creation.
If
the Legislature can create a cause of action, it must be
able
to
eliminate
Conditioning
(1982).
Co,
or
416
modify
Mich
it.
558,
Karl
573-576;
v
331
Bryant
Air
NW2d
456
Otherwise, one Legislature could bind a subsequent
Legislature to not undo its work.
This is impermissible.
Pittsfield Twp v Washtenaw Co, 468 Mich 702, 713; 664 NW2d
193 (2003), citing Malcolm v East Detroit, 437 Mich 132,
139; 468 NW2d 479 (1991).
That being so, it logically
follows that the Legislature can also take the less drastic
step of leaving the cause of action intact, but limiting
the damages recoverable for a particular cause of action
13
Art 3, § 7 of the Michigan Constitution states:
The common law and the statute laws now in
force, not repugnant to this constitution, shall
remain in force until they expire by their own
limitations, or are changed, amended or repealed.
16
from a particular defendant.14
See Karl, supra at 577;
Shavers v Attorney General, 402 Mich 554, 623; 267 NW2d 72
(1978).
Like
the
congressionally
imposed
civil
penalties
discussed in Tull, supra at 426, the Michigan Legislature’s
limits
on
defendant’s
liability
do
not
involve
the
“‘substance of a common-law right to a trial by jury,’” or
a
“‘fundamental
deleted.)
element
of
a
jury
trial.’”
(Citations
These are things that are not under the umbrella
of the right.
In other words, MCL 257.401(3) only limits
the legal consequences of the jury’s finding regarding the
liability.
implicated.
Plaintiff’s
She
has
right
had
a
to
jury
determined the facts of her case.
complete.
a
jury
trial
trial
and
is
the
not
jury
The jury’s function is
It is up to the court to determine the legal
effect of those findings, whether it be that her damages
14
We note that the Legislature has limited a
plaintiff’s ability to fully recover his assessed damages
in other circumstances, such as where he is more than fifty
percent at fault, MCL 600.2955a (constitutionality upheld
in Wysocki v Kivi, 248 Mich App 346; 639 NW2d 572 [2001])
and 500.3135; if he was operating his own vehicle while
uninsured, MCL 500.3135(2)(c); if a judgment in his favor
was discharged in bankruptcy, MCL 600.2914; if his claim
involves noneconomic damages in a products liability
action, MCL 600.2946a (constitutionality upheld in Kenkel v
Stanley Works, 256 Mich App 548; 665 NW2d 490 [2003]).
17
are capped, reduced, increased, tripled, reduced to present
value, or completely unavailable.
IV
Plaintiff also asserts that MCL 257.401(3) violates
our Constitution’s Equal Protection Clause, which provides
in part, “No person shall be denied the equal protection of
the laws . . . .”
Const 1963, art 1, § 2.
argument
unlike
that
she,
plaintiffs
in
It is her
litigation
not
concerning rental cars, cannot recover what the jury has
decided are her damages.
the
equal
protection
Thus, she argues, she is denied
of
the
law
under
the
Michigan
different
treatment
Constitution.
At
given
issue,
to
then,
is
plaintiffs
constitutional.
As
whether
in
is
the
cases
apparent,
of
this
sort
is
when
any
statute
is
passed, the Legislature is almost invariably deciding to
treat certain individuals differently from others.
exercise
of
discrimination
between
citizens
means,
This
for
example, that some pay taxes at one rate, while others pay
at another rate.
Or some get a tax or social service
benefit that others do not, and so on.
Line drawing of
this sort is inherent in all governments and in ours it is
done at the state level by the Legislature, Const 1963, art
4,
§
1,
and
locally
by
local
18
legislative
bodies.
The
Constitution of Michigan was, in fact, written in large
part to institutionalize this method of decision-making.
Thus, it is apparent that when the Legislature acts, it
cannot be that the mere occurrence of different outcomes
between two citizens is in itself sufficient to make an act
unconstitutional.
Otherwise, what the Constitution gives
with
right
one
hand—the
to
representative
government—it
would have taken away with the other—the equal protection
guarantee.
Accordingly, courts here and elsewhere in the
United States have been very guarded about overruling the
legislatures’ decisions by declaring unconstitutional the
classifications that a legislature defined.
Indeed, the
undesirability of courts entering into this area prompted
United States Supreme Court Justice Oliver Wendell Holmes
to deride all arguments of this sort as “the usual last
resort of constitutional arguments.”
Buck v Bell, 274 US
200, 208; 47 S Ct 584; 71 L Ed 1000 (1927).
Yet, even with
this reluctance, the courts have been willing to intervene
in a narrow class of cases.
As the law has developed, the first category of such
cases
is
where
“strict
scrutiny,”
as
the
courts
have
described it, has been applied to the legislative decision.
For a decision to be subject to such scrutiny, it must be a
classification that is based on “suspect” factors such as
19
race, national origin, ethnicity, or a “fundamental right.”
Harvey v Michigan, 469 Mich 1, 6-7; 664 NW2d 767 (2003);
Plyler v Doe, 457 US 202, 216-217; 102 S Ct 2382; 72 L Ed
2d 786 (1982).
When such review is called for, the courts
require “the State to demonstrate that its classification
has
been
precisely
tailored”
compelling
governmental
DeRose
DeRose,
v
(2003)(“narrowly
and
interest.”
469
Mich
If
must
Plyler,
320,
tailored”).
it
353;
this
“serve
at
666
a
216-217;
636
missing,
is
NW2d
the
statute falls to the Constitution.
The second type of case in which courts will intervene
are those described as cases that implicate intermediate
level
scrutiny.
Here,
the
court,
using
“heightened
scrutiny,” reviews legislation creating classifications on
such bases as illegitimacy and gender.
Harvey, supra at 8.
Under this standard, a challenged statutory classification
will be upheld only if it is substantially related to an
important governmental objective.
Id.
The third level is “rational basis” review.
Under
this test, “courts will uphold legislation as long as that
legislation
is
rationally
related
to
a
legitimate
government purpose.”
Crego v Coleman, 463 Mich 248, 259;
615 NW2d 218 (2000).
This highly deferential standard of
review requires a challenger to show that the legislation
20
is “‘arbitrary and wholly unrelated in a rational way to
the
objective
of
the
statute.’”
Id.,
quoting
Smith
v
Employment Security Comm, 410 Mich 231, 271; 301 NW2d 285
(1981).
In
the
present
case,
plaintiff
claims
that
the
discrimination imposed on her should be evaluated on the
basis of strict scrutiny.
She characterizes the right at
issue as the right to a jury trial.
However, rights are
always to be identified at “the most specific level at
which
a
protection
relevant
tradition
to,
asserted
the
protecting,
right
can
be
or
denying
identified.”
Michael H v Gerald D, 491 US 110, 127 n 6; 109 S Ct 2333;
105
L
Ed
2d
91
(1989).
This
means
that,
rather
than
describing the right sweepingly, we are to define it with
the most precision possible.
In this case, we conclude
that the right at issue here is not the overarching right
to have a jury trial but, more precisely, a claimed right
to have a jury’s assessment of damages be unmodifiable as a
matter of law.
With the right properly understood, we turn to whether
it is of the sort to which strict scrutiny applies.
The
United States Supreme Court has developed a test for strict
scrutiny that this Court has followed when interpreting our
own Constitution.
See, e.g., DeRose, supra.
21
Because this
case clearly does not result in discrimination by race,
national origin, or ethnicity, nor affect an interest that
is
fundamental,
that
is,
“an
interest
traditionally
protected by our society,” Michael H, supra at 122, this
statute does not warrant strict scrutiny review.
While
rights such as this may be “important and valuable,” they
are
not
encompassed
by
strict
scrutiny
unless
they
“implicit in ‘the concept of ordered liberty.’”
are
People v
Gonzales, 356 Mich 247, 260; 97 NW2d 16 (1959), citing
Palko v Connecticut, 302 US 319; 58 S Ct 149; 82 L Ed 288
(1937).
The right to full recovery in tort is not only not
a fundamental right, it is not a right at all, as the
discussion above makes clear.
Therefore, strict scrutiny
does not apply.
Concerning
intermediate
scrutiny,
this
legislative
action has nothing to do with allegations of gender or
illegitimacy and thus heightened scrutiny is inappropriate.
This
leaves
the
rational
foundation for analysis.
and
economic
basis
test
as
the
proper
Rational basis applies to social
legislation,
of
which
this
is
an
example.
Romein v Gen Motors Corp, 436 Mich 515, 525; 462 NW2d 555
(1990).
The
“classification
rational
itself
basis
is
test
considers
rationally
legitimate governmental interest.”
22
whether
related
to
the
a
Shavers, supra at 554,
quoting United States Dep’t of Agriculture v Moreno, 413 US
528, 533; 93 S Ct 2821; 37 L Ed 2d 782 (1973).
But the
rational basis test does not test “the wisdom, need, or
appropriateness of the legislation . . . .”
at 260.
was
We examine the purpose with which the legislation
enacted,
struck
Crego, supra
may
not
have
its
effects:
profound
and
“That
the
far-reaching
accommodation
consequences
. . . provides all the more reason for this Court to defer
to
the
congressional
judgment
arbitrary or irrational.”
unless
it
is
demonstrably
Duke Power Co v Carolina Envir
Study Group, 438 US 59, 83-84; 98 S Ct 2620, 57 L Ed 2d 595
(1978).
In discerning the purpose, we look to “any set of
facts, either known or which could reasonably be assumed,
even if such facts may be debatable.”
Harvey, supra at 7.
Applying this law, we conclude that this statute, obviously
designed to reduce insurance costs for automobile lessors,
could have been seen as a measure that, because costs of
operations are reduced, increases the number of providers
from which Michigan consumers may choose, or even just to
enhance automobile sales for our leading domestic industry
as more lessors transact business in the state.
Moreover,
as we are informed by a brief amicus curiae, the amendment
of
MCL
257.401,
limiting
lessor’s
liability
removed
Michigan from the small remaining minority of states that
23
still
impose
unlimited
liability
on
automobile
lessors.
This could be seen as joining with other states in viewing
vicarious liability as unwise public policy, at least in
these circumstances.
Thus, the legislation is rationally
related to legitimate governmental interest.
Because MCL 257.401(3) satisfies the rational basis
test, it does not violate the rights granted by the Equal
Protection Clause of the Michigan Constitution.
V
Plaintiff also argues that MCL 257.401(3) violates her
substantive
due
Constitution,
process
which
rights
provides
in
under
the
pertinent
Michigan
part
that
no
person shall “be deprived of life, liberty or property,
without due process of law . . . .”
17.
Const 1963, art 1, §
To analyze whether a plaintiff’s due process rights
have been violated, we determine “whether the legislation
bears a reasonable relation to a permissible legislative
objective.”
Detroit v Qualls, 434 Mich 340, 366-367 n 49;
454 NW2d 374 (1990).
This is, in essence, the same test
employed in the equal protection analysis, and we reach the
same
result.
257.401(3)
does
Therefore,
not
because
violate
we
find
plaintiff’s
that
rights
MCL
under
Michigan’s Equal Protection Clause, we also find it does
not violate her rights under Michigan’s Due Process Clause.
24
VI
By holding that damage caps legislation is permissible
and inoffensive to the Constitution, we join many other
states in reaching this conclusion.
Some of the more well
written opinions include the Supreme Court of California,
which stated in Fein v Permanente Med Group, 38 Cal 3d 137,
161; 695 P2d 665; 211 Cal Rptr 368 (1985), “[W]e know of no
principle of California—or federal—constitutional law which
prohibits
damages
the
in
a
Legislature
particular
from
limiting
setting
legitimate state interest.”
in
the
order
recovery
to
of
further
a
The Supreme Judicial Court of
Massachusetts, in English v New England Med Ctr, Inc, 405
Mass 423, 427; 541 NE2d 329 (1989), held, “the personal,
substantive right of a tort victim to recover damages is
not a fundamental interest.”
(Quotation marks deleted.)
The Supreme Court of Appeals of West Virginia similarly
upheld damages caps in Robinson v Charleston Area Med Ctr,
Inc, 186 W Va 720, 729; 414 SE2d 877 (1991), saying, “the
‘rational
basis’
test
for
state
constitutional
equal
protection purposes is applicable in this jurisdiction to
. . . statutory limitation on remedies in certain common
law
causes
recoverable
of
action,
amount
of
such
as
damages.”
statutory
The
‘caps’
Supreme
on
Court
the
of
Indiana, in Johnson v St Vincent Hosp, Inc, 237 Ind 374,
25
396;
404
NE2d
585
(1980),
stated,
concerning
a
similar
statutory cap on damages, “It is not a presumption which
prevents recovery of more than that amount, but the policy
of the law in the statute.
of
due
process
on
this
The limitation is not a denial
basis.”
The
Supreme
Court
of
Virginia, in Etheridge, 237 Va 95, 96, noted, “[A] remedy
is a matter of law, not a matter of fact,” and “although a
party has the right to have a jury assess his damages, he
has no right to have a jury dictate through an award the
legal consequences of its assessment.”
Reinforcing
the
findings
of
a
majority
of
state
supreme courts on this issue is the analysis of the United
States Supreme Court that “statutes limiting liability are
relatively commonplace and have consistently been enforced
by the courts.”
Duke Power, 438 US 88-89 n 32 (citations
deleted).
What these courts have been unwilling to do is to
usher in a new Lochner15 era.
It was during that era when,
for a time after the industrial expansion of the United
States
began
in
the
mid-nineteenth
century
and,
on
the
basis of strained constitutional interpretation, the United
15
Lochner v New York, 198 US 45; 25 S Ct 539; 49 L Ed
937 (1905).
26
States Supreme Court threw out economic regulations that
had been won in the political process.
The central theme
of the Lochner jurisprudence was, as Justice Peckham wrote
of the ill-fated New York state effort to regulate the
hours of bakers, “[A]re we all
legislative majorities?”
. . . at the mercy of
Id. at 59.
the Court concluded, “No.”16
He and a majority of
Yet, by the mid-1930s, in
Nebbia v New York, 291 US 502, 537; 54 S Ct 505; 78 L Ed
940 (1934), Justice Owen Roberts’s majority opinion for the
Court
stated
that
“a
state
is
free
to
adopt
whatever
economic policy may reasonably be deemed to promote public
welfare . . . . With the wisdom of the policy adopted,
. . . the courts are both incompetent and unauthorized to
deal.”
From that time, economic regulation, such as the
16
This case is taken as the signature case of this
era, without doubt, because of the striking dissent of
Justice Oliver Wendell Holmes, in which, regarding economic
regulation, he famously said:
This case is decided upon an economic theory
which a large part of the country does not
entertain. If it were a question whether I agreed
with that theory I should desire to study it
further and long before making up my mind. But I
do not conceive that to be my duty, because I
strongly
believe
that
my
agreement
or
disagreement has nothing to do with the right of
a majority to embody their [sic] opinions in law.
[Lochner v New York, 198 US 75 (Holmes, J.,
dissenting).]
27
measure we deal with today, has consistently been held to
be an issue for the political process, not for the courts.
Along with the noted jurisdictions, we are unwilling to
turn our backs on this law.
It is into this mainstream
that we again steer our economic regulation jurisprudence.
We hold that the damages cap in MCL 257.401(3) is
constitutional and does not violate plaintiff’s rights to a
jury
trial,
equal
protection,
Michigan Constitution.
or
due
process
under
the
Therefore, we affirm the decision
of the Court of Appeals.
Clifford W. Taylor
Maura D. Corrigan
Robert P. Young, Jr.
Stephen J. Markman
28
S T A T E
O F
M I C H I G A N
SUPREME COURT
MARGARET PHILLIPS, PERSONAL REPRESENTATIVE
OF THE ESTATE OF REGEANA DIANE HERVEY,
Deceased,
Plaintiff-Appellant,
v
No. 121831
MIRAC, INC.,
Defendant-Appellee.
_______________________________
WEAVER, J. (concurring in part and dissenting in part).
I
concur
in
the
majority’s
conclusion
that
MCL
257.401(3), which caps the amount of a lessor’s liability
in motor vehicle leases of thirty days or less, does not
violate plaintiff’s constitutional rights to a jury trial,1
equal protection,2 or due process.3
But I do so pursuant to
my own reasoning, which is set forth below.
I
dissent
from
the
majority’s
conclusion
that
the
right to trial by jury must be interpreted according to the
meaning that those “learned in the law” would give the
1
Const 1963, art 1, § 14.
2
Const 1963, art 1, § 2.
3
Const 1963, art 1, § 17.
phrase.
Our primary rule of constitutional interpretation
must be the common understanding that the people would have
given
the
constitutional
provision
at
the
time
of
ratification, not the meaning that those “learned in the
law” would give it.
Facts and Proceedings Below
Plaintiff’s decedent, Regeana Hervey, was killed in a
car accident on October 27, 1997, when Da-Fel Reed, the
driver of the car in which Ms. Hervey was a passenger, lost
control of her vehicle and struck another vehicle.
Ms.
Reed had leased the car that she was driving from defendant
Mirac, Inc., which does business as Enterprise Rent-A-Car.
The parties stipulated that the lease was for a period of
thirty days or less.
Decedent’s mother, plaintiff Margaret
Phillips, sued Ms. Reed, as well as defendant.
against
defendant
was
premised
on
the
owner’s
The suit
liability
statute, MCL 257.401.4
Before trial, the parties entered into an agreement
that
collection
of
a
judgment
against
defendant
Mirac,
Inc., would exceed $20,000 only if MCL 257.401(3), which
imposes a $20,000 cap on defendant’s liability, were deemed
unconstitutional.
4
The parties further agreed that even if
Ms. Reed is not a party to this appeal.
2
the cap were deemed unconstitutional, the maximum judgment
to be entered on the verdict would be $250,000 and the
minimum judgment to be entered on the verdict would be
$150,000.
Additionally, the agreement recognized that Ms.
Reed was uncollectible, and plaintiff agreed that she would
not
seek
entry
of
a
judgment
against
Ms.
Reed
on
any
verdict.
Following
a
jury
trial
in
November
1999,
the
jury
found Ms. Reed negligent and awarded plaintiff $900,000 in
damages.
Plaintiff
then
requested
that
a
judgment
of
$250,000 be entered against defendant Mirac, Inc., on the
verdict,
while
defendant
requested
$20,000 be entered on the verdict.
judgment
to
257.401(3)
enter,
was
the
trial
court
unconstitutional
and
that
a
judgment
of
In determining which
concluded
entered
that
MCL
a
judgment
the
statute
against defendant for $250,000.
First,
the
trial
court
determined
that
violated plaintiff’s right to a jury trial.
The trial
court stated that the 1963 Constitution, court rule, and
case law all provide for the right to a jury’s assessment
of
damages
and
that
this
right
must
be
preserved.
Consequently, the Legislature could not impose a cap on the
jury’s assessment of damages and its attempt to do so in
MCL 257.401(3) violated the constitutional right to have a
3
jury assess damages, as that right existed in 1929, before
the
ratification
1963.
of
Michigan’s
current
Constitution
in
The trial court found more persuasive decisions from
those states that had similarly concluded that damage caps
violate the right to a jury trial.
acknowledge
that
the
But the trial court did
Legislature
could
eliminate
the
owner’s liability statute altogether.
Second, the trial court determined that the statute
violated plaintiff’s rights to equal protection under the
law.
The trial court reasoned that the right to a jury
trial was a fundamental right and, therefore, required a
strict scrutiny review.
The trial court concluded that,
because there was no compelling governmental interest in
regulating
Michigan’s
car
rental
industry,
the
statute
the
statute
failed the strict scrutiny test.
Third,
the
trial
court
concluded
that
violated the constitutional right to due process for the
same reasons that the statute violated the right to equal
protection.5
5
The trial court also concluded that the statute did
not violate the separation of powers doctrine. That issue
is not before this Court.
4
Defendant appealed, and the Court of Appeals reversed
in a two-to-one published opinion.6
Addressing the right to
a jury trial, the Court of Appeals majority held that the
cap did not infringe plaintiff’s right to trial by jury for
two reasons.
modify
First, because the Legislature can abolish or
common-law
necessarily
and
follows
statutory
that
it
rights
can
recoverable for a cause of action.
and
limit
remedies,
the
it
damages
Second, the statute
does not infringe the jury’s right to decide cases because
the
damages
cap
does
not
remove
from
the
determination of facts and amount of damages.
jury
the
The statute
simply limits the amount of damages that can be recovered
from a lessor of vehicles.
Thus, the cap only limits the
legal consequences of the jury’s finding.
251 Mich App
590-595.
Next, the majority addressed whether the cap violates
plaintiff’s
Because
the
right
to
statute
equal
at
protection
issue
is
under
social
or
the
law.
economic
legislation, the majority examined it under the rational
basis test.
The majority concluded that it was reasonable
to assume that Michigan has a legitimate interest in the
continued
6
operation
of
automobile
rental
251 Mich App 586; 651 NW2d 437 (2002).
5
businesses
and
that protecting these businesses from large damage awards
was rationally related to that purpose.
not
violate
plaintiff’s
Therefore, the
statute
did
equal
protection
rights.
Similarly, because the tests for due process and
equal protection are essentially the same, the cap also did
not violate plaintiff’s due process rights.
Id. at 595
598.
The Court of Appeals dissenter would have held that
the damages cap is unconstitutional because it violates the
right
to
a
jury
trial.
The
dissenter
explained
that
“[b]ecause our constitution confers a right to trial by
jury, and because the right to trial by jury in Michigan
extends to a determination of damages, the damages cap in
the instant case is unconstitutional.”
statutory
damages
cap
renders
the
Id. at 599.
jury’s
role
The
illusory.
While the Legislature may be free to abolish a cause of
action,
it
may
Constitution.
Plaintiff
not
abolish
a
right
mandated
Court
granted
by
the
leave
to
Id. at 600.
appealed
and
this
appeal, “limited to whether MCL 257.401(3) constitutes an
unconstitutional
denial
of
plaintiff’s
trial, equal protection, or due process.”7
7
468 Mich 941 (2003).
6
right
to
a
jury
Standard of Review
The constitutionality of a statute is a question of
law that is reviewed de novo.
Tolksdorf v Griffith, 464
Mich 1, 5; 626 NW2d 163 (2001).
constitutional.
Statutes are presumed
This Court has stated:
No rule of construction is better settled in
this country, both upon principle and authority,
than that the acts of a state legislature are to
be presumed constitutional unless the contrary is
shown; and it is only when they manifestly
infringe some provision of the constitution that
they can be declared void for that reason.
In
cases of doubt, every possible presumption, not
clearly inconsistent with the language and the
subject matter, is to be made in favor of the
constitutionality of the act.
The power in declaring laws unconstitutional
should be exercised with extreme caution, and
never where serious doubt exists as to the
conflict . . . . These rules are founded in the
best reasons; because, as suggested by my brother
Manning, while the supreme judicial power may
interfere to prevent the legislative and other
departments from exceeding their powers, no
tribunal has yet been devised to check the
encroachments of that judicial power itself.
[Sears
v
Cottrell,
5
Mich
251,
259-260
(1858)(emphasis in original).]
Analysis
The
statute
at
issue
in
this
case,
MCL
257.401,
provides in part:
(3) Notwithstanding subsection (1), a person
engaged in the business of leasing motor vehicles
who is the lessor of a motor vehicle under a
lease providing for the use of the motor vehicle
by the lessee for a period of 30 days or less is
liable for an injury caused by the negligent
7
operation of the leased motor vehicle only if the
injury occurred while the leased motor vehicle
was being operated by an authorized driver under
the lease agreement or by the lessee's spouse,
father, mother, brother, sister, son, daughter,
or other immediate family member. Unless the
lessor, or his or her agent, was negligent in the
leasing of the motor vehicle, the lessor's
liability under this subsection is limited to
$20,000.00 because of bodily injury to or death
of 1 person in any 1 accident and $40,000.00
because of bodily injury to or death of 2 or more
persons in any 1 accident. [Emphasis added.] [8]
Right to a Jury Trial
Plaintiff asserts that MCL 257.401(3) violates art 1,
§ 14 of the Michigan Constitution, which provides:
The right
shall be
8
of trial by jury shall remain, but
waived in all civil cases unless
Subsection 1 of the statute provides:
This section shall not be construed to limit
the right of a person to bring a civil action for
damages for injuries to either person or property
resulting from a violation of this act by the
owner or operator of a motor vehicle or his or
her agent or servant. The owner of a motor
vehicle is liable for an injury caused by the
negligent operation of the motor vehicle whether
the negligence consists of a violation of a
statute of this state or the ordinary care
standard required by common law. The owner is not
liable unless the motor vehicle is being driven
with his or her express or implied consent or
knowledge. It is presumed that the motor vehicle
is being driven with the knowledge and consent of
the owner if it is driven at the time of the
injury by his or her spouse, father, mother,
brother,
sister,
son,
daughter,
or
other
immediate member of the family. [MCL 257.401(1).]
8
demanded by one of the parties in the manner
prescribed by law.
In all civil cases tried by
12 jurors a verdict shall be received when 10
jurors agree.
I disagree that the statute violates the right to a jury
trial and find the Court of Appeals analysis on this point
persuasive.
But
before
explaining
my
rationale
for
concluding that the statute is constitutional, I wish to
note my continued disagreement with rules of constitutional
interpretation
set
forth
in
the
majority
opinion.
Our
primary rule of constitutional interpretation must be the
common understanding that the people would have given the
constitutional provision at the time of ratification, not
the meaning that those “learned in the law” would give it.
See, e.g., Adair v Michigan, 470 Mich 105, 143; ___ NW2d
___ (2004) (Weaver, J., dissenting in part and concurring
in part);
Silver Creek Drain Dist v Extrusions Division,
Inc, 468 Mich 367, 382; 663 NW2d 436 (2003) (Weaver, J.,
concurring in part and dissenting in part).
Therefore, on
this important point, I dissent from the majority opinion.
First, as the Court of Appeals noted, the damages cap
contained in MCL 257.401(3) does not violate plaintiff’s
right to a jury trial because the Legislature has the power
under our Constitution to abolish or modify common-law and
statutory rights and remedies.
9
Donajkowski v Alpena Power
Co,
460 Mich 243, 256 n 14; 596 NW2d 574 (1999).
Art 3, §
7 of the Michigan Constitution states:
The common law and the statute laws now in
force, not repugnant to this constitution, shall
remain in force until they expire by their own
limitations, or are changed, amended or repealed.
Where the Legislature can completely eliminate a cause of
action, it logically follows that the Legislature can also
take
the
less
drastic
step
of
limiting
recoverable for a particular cause of action.
the
damages
See Kirkland
v Blaine Co Med Ctr, 134 Idaho 464, 468; 4 P3d 1115 (2000);
Murphy v Edmonds, 325 Md 342, 373; 601 A2d 102 (1992).
In
other words, if the Legislature can completely eliminate an
owner’s liability, it follows that it may take the less
drastic step of limiting an owner’s liability.9
9
The dissent acknowledges that the Legislature can
repeal a statute, but then concludes that it cannot take
the less drastic step of limiting the remedy provided by
the statute because to do so abrogates a citizen’s
constitutional rights. Post at 4.
This makes no sense.
Before the enactment of MCL 257.401, an “owner of a motor
vehicle was not liable for the negligence of a person to
whom he had loaned it” unless the vehicle was used in
operation of the owner’s business.
Moore v Palmer, 350
Mich 363, 392; 86 NW2d 585 (1957). It was only through the
Legislature’s enactment of MCL 257.401 that a cause of
action against motor vehicle owners was created.
If the
Legislature can completely eliminate this cause of action
that it created against the owner of a motor vehicle
without violating the Constitution, it certainly may take
the less drastic step of limiting the remedy for the cause
of action it created.
10
Second, as the Court of Appeals also explained, MCL
257.401(3) does not violate plaintiff’s right to a jury
trial because the provision does not infringe the jury’s
right to decide the case.
The jury still determines the
facts and the damages incurred by plaintiff.
It is only
after the jury has done so that the cap is applied to limit
liability.
Thus,
MCL
257.401(3)
only
limits
the
legal
consequences of the jury’s finding regarding the liability.
As the Maryland Court explained in Murphy, supra at 373:
The General Assembly, however, did not
attempt to transfer what is traditionally a jury
function to the trial judge.
Instead, the
General Assembly abrogated any cause of action
for noneconomic tort damages in excess of
$350,000; it removed the issue from the judicial
arena. No question exists concerning the role of
the judge versus the jury with respect to
noneconomic
damages
in
excess
of
$350,000.
Therefore,
no
question
concerning
the
constitutional
right
to
a
jury
trial
is
presented.
I find it noteworthy that the limitation on damages in
this case applies only to limit the lessor’s liability.
There is no cap on the damages that limits the liability of
the lessee or operator of the vehicle.
This distinction is
recognized in MCL 257.401(4), which provides:
A person engaged in the business of leasing
motor vehicles as provided under subsection (3)
shall notify a lessee that the lessor is liable
only up to the maximum amounts provided for in
subsection (3), and only if the leased motor
vehicle was being operated by the lessee or other
11
authorized driver or by the lessee's spouse,
father, mother, brother, sister, son, daughter,
or other immediate family member, and that the
lessee may be liable to the lessor up to amounts
provided for in subsection (3), and to an injured
person for amounts awarded in excess of the
maximum amounts provided for in subsection (3).
[Emphasis added.]
Thus,
a
plaintiff
has
the
opportunity
for
a
complete
recovery against the party whom the jury has determined to
be negligent—the lessee or operator of the vehicle, and
this opportunity makes plaintiff’s argument that the cap
violates the right to a jury trial even less convincing.10
10
The recognition of this possibility of recovery was
relied on in a recent Florida case upholding the
constitutionality of a similar Florida statute.
The
Florida Court explained:
[Fla
Stat
324.021,
which
limits
the
liability of short-term motor vehicle lessors]
does not violate this section of the Florida
Constitution by limiting plaintiff’s right to
trial by jury. Under this statute, a jury still
retains the ability to fully assess all damages
against those at fault.
Section 324.021 merely
limits a plaintiff’s available damages from the
owner of the vehicle.
A plaintiff retains the
ability to recover fully from the lessee or
operator of the vehicle.
[Enterprise Leasing Co
South Central, Inc v Hughes, 833 So 2d 832, 838
(Fla App, 2002).]
I note that I do not consider the possibility of
complete recovery from the negligent party to be a
constitutional prerequisite for upholding a damages cap.
12
For these reasons, I conclude that MCL 257.401(3) does
not violate plaintiff’s right to a jury trial.
Equal Protection
Plaintiff also asserts that MCL 257.401(3) violates
her right to equal protection under the law.
Michigan’s
Equal Protection Clause provides in part, “No person shall
be denied the equal protection of the laws . . . .”
1963, art 1, § 2.
Const
Equal protection challenges are reviewed
using one of three levels of scrutiny:
rational basis,
heightened or intermediate scrutiny, and strict scrutiny.
Harvey v Michigan, 469 Mich 1, 6-7; 664 NW2d 767 (2003).
I
disagree with plaintiff’s contention that the statute at
issue in the present case should be reviewed under a strict
scrutiny standard because the right to a jury trial is a
fundamental right.
The strict scrutiny standard of review
typically
applies
to
based
“suspect
factors”
on
national
origin.
laws
Id.
in
which
such
at
as
7.
classifications
race,
Social
ethnicity,
or
are
or
economic
legislation, on the other hand, is generally subject to
review under the rational basis test.
Mich
305,
332;
462
NW2d
310
People v Perlos, 436
(1990.
Tort
reform
legislation, such as the statute in the present case, is
typically
treated
as
socioeconomic
13
legislation
that
is
subject to rational basis review.
See Stevenson v Reese,
239 Mich App 513, 517-518; 609 NW2d 195 (2000).
The
rational
“classification
basis
itself
test
is
considers
rationally
legitimate governmental interest.”
test
“the
wisdom,
need,
or
Id.
whether
related
to
the
a
But it does not
appropriateness
of
the
legislation . . . .”
Crego v Coleman, 463 Mich 248, 260;
615 NW2d 218 (2000).
I agree with the Court of Appeals
that
this legislation passes that test because it can
reasonably be assumed that Michigan has a
legitimate interest in the continued operation of
automobile rental businesses, and protecting
those businesses from large damage awards in jury
trials bears a rational relationship to that end.
[251 Mich App 598.][11]
Because the statute satisfies the rational basis test, it
does not violate the rights granted by the Equal Protection
Clause.12
11
The dissent makes much of the other measures that
might have been taken by the Legislature to address the
concerns of car rental companies. Post at 5-6, 8-9. In my
opinion, such analysis usurps the Legislature’s role to
weigh interests and policy considerations when enacting a
statute.
12
I note that had a majority of this Court in Harvey,
not overruled the heightened scrutiny articulated in
Manistee Bank & Trust Co v McGowan, 394 Mich 655; 232 NW2d
636 (1975),
consistently with my dissent in Harvey, I
would have employed the “fair-and-substantial-relation-to
the-object-of-the-legislation” test from Manistee Bank when
(continued…)
14
Due Process
Lastly, plaintiff argues that MCL 257.401(3) violates
her due process rights.
The Michigan Constitution provides
in pertinent part that no person shall “be deprived of
life,
liberty
or
property
Const 1963, art 1, § 17.
without
due
process
of
law.”
The test for due process is
“whether the legislation bears a reasonable relation to a
permissible
legislative
objective.”
Shavers
v
Attorney
General, 402 Mich 554, 612; 267 NW2d 72 (1978).
This is
essentially the same test employed in the equal protection
analysis.
Doe v Dep’t of Social Services, 439 Mich 650,
682 n 36; 487 NW2d 166 (1992).
Therefore, for the same
reasons that MCL 257.401(3) does not violate the rights
secured by the Equal Protection Clause, it also does not
violate those secured by the Due Process Clause.
Conclusion
I agree that the damages cap is constitutional and
does not violate plaintiff’s rights to a jury trial, equal
(…continued)
analyzing plaintiff’s equal protection claim in this case.
See Harvey, supra at 16-19 (Weaver, J., dissenting).
However, even under this heightened scrutiny, I would have
concluded that the statute is constitutional and does not
violate plaintiff’s equal protection rights.
15
protection, or due process.
Therefore, I concur in the
result of the majority opinion, but under my own reasoning.
I dissent from the majority’s conclusion that the right to
a jury trial must be interpreted according to the meaning
that those “learned in the law” would give the phrase.
Rather, our primary rule of constitutional interpretation
must be the common understanding that the people would have
given
the
constitutional
provision
at
the
time
ratification.
Elizabeth A. Weaver
16
of
its
S T A T E
O F
M I C H I G A N
SUPREME COURT
MARGARET PHILLIPS, PERSONAL REPRESENTATIVE
OF THE ESTATE OF REGEANA DIANE HARVEY,
DECEASED,
Plaintiff-Appellant,
v
No. 121831
MIRAC, INC,
Defendant-Appellee.
_______________________________
CAVANAGH, J. (dissenting).
Michigan’s Constitution provides our citizens with the
right to trial by jury.
Const 1963, art 1, § 14.
Because
I believe the right to a jury trial is a fundamental right
that encompasses the right to have our citizens awarded
damages based on the jury’s determination and because I
believe
1
MCL
257.401(3),1
MCL 257.401(3),
liability of a lessor
following:
the
damages
cap
in
this
case,
covering civil actions and
of a motor vehicle, states
the
the
Notwithstanding subsection (1), a person
engaged in the business of leasing motor vehicles
who is the lessor of a motor vehicle under a
lease providing for the use of the motor vehicle
by the lessee for a period of 30 days or less is
liable for an injury caused by the negligent
operation of the leased motor vehicle only if the
injury occurred while the leased motor vehicle
(continued…)
violates plaintiff’s right to a jury trial, as well as
plaintiff’s equal protection and substantive due process
rights, I respectfully dissent.
I. THE CONSTITUTIONAL RIGHT TO A TRIAL BY JURY
“The right of trial by jury shall remain, but shall be
waived in all civil cases unless demanded by one of the
parties in the manner prescribed by law.”
1, § 14.
Const 1963, art
“The right to jury trial in civil litigation is
of constitutional dimension.”
Wood v Detroit Automobile
Inter-Ins Exchange, 413 Mich 573, 581; 321 NW2d 653 (1982).
The right to a jury trial is a fundamental right, “regarded
as the great bulwark of the liberty of the citizen.”
McRae
v Grand Rapids, L & D R Co, 93 Mich 399, 401; 53 NW 561
(1892); see also People v Smith, 383 Mich 576, 578; 177
NW2d 164 (1970) (“Trial by jury is a basic constitutional
right.”).
(…continued)
was being operated by an authorized driver under
the lease agreement or by the lessee's spouse,
father, mother, brother, sister, son, daughter,
or other immediate family member. Unless the
lessor, or his or her agent, was negligent in the
leasing of the motor vehicle, the lessor's
liability under this subsection is limited to
$20,000.00 because of bodily injury to or death
of 1 person in any 1 accident and $40,000.00
because of bodily injury to or death of 2 or more
persons in any 1 accident.
2
The right to a jury trial also encompasses the right
to have the jury determine damages.
Mich 574, 578; 227 NW 767 (1929).
Leary v Fisher, 248
In Aho v Conda, 347 Mich
450, 455; 79 NW2d 917 (1956), this Court stated that “the
question of damages is fundamentally a jury question.”
In
Rouse v Gross, 357 Mich 475, 481; 98 NW2d 562 (1959), this
Court stated, “The right of trial by jury ordinarily refers
to a right to present or defend an actionable claim to 1
jury to the point of jury verdict and judgment.”
See also
Rich v Daily Creamery Co, 303 Mich 344, 349; 6 NW2d 539
(1942); Sweeney v Hartman, 296 Mich 343, 347; 296 NW 282
(1941).2
It
is
perplexing,
to
say
the
least,
that
the
2
While the majority uses a scholarly article written
in the Harvard Law Review to support its position, I
believe that cases decided by justices from this Court are
more persuasive in determining the rights of Michigan
citizens. The majority does cite two Michigan cases—May v
Goulding, 365 Mich 143, 148-149; 111 NW2d 862 (1961), and
McClelland v Scholz, 366 Mich 423, 426; 115 NW2d 120
(1962)—for the unremarkable proposition that a jury cannot
decide an issue of law.
However, the cases cited have
nothing to do with the issue of the jury determining
damages.
None of the questions submitted to the jury in
May and McClelland that were deemed improper by this Court
had anything to do with damages.
I also vehemently disagree with the majority that “the
right of trial by jury” is a “technical legal phrase” that
is to be determined “as understood by those learned in the
law at the time.”
Ante at 10.
The primary rule of
constitutional interpretation is “common understanding.”
Macomb Co Taxpayers Ass’n v L’Anse Creuse Pub Schools, 455
Mich 1, 6; 564 NW2d 457 (1997).
“A constitution is made
(continued…)
3
majority argues that the damages cap does not implicate
plaintiff’s right to a jury trial.
The majority argues
that damages were “never within those things a jury can
decide.”
Ante at 15.
But a jury does decide damages.
Merely because the majority deems a damages determination
to
be
part
of
the
“great
mass
of
procedural
forms
and
details,” ante at 12, and not within the jury’s purview,
does not change the fact that part of the jury’s historic
role has been to determine damages.
invades the jury’s role.
Thus, the damages cap
Because of the $20,000 damages
cap, when the amount of damages determined by the jury is
over
$20,000,
consequence.
the
jury’s
determination
is
of
no
The right to a jury trial is illusory in the
most severe cases, those in which the amount of damages
exceeds $20,000.
Surely, this illusory “right” does not
comport with our citizens’ constitutional right to trial by
jury.
The
right
to
a
jury
trial
is
not
satisfied
by
providing jurors the opportunity to announce an award and
then have it arbitrarily ignored with no regard for the
(…continued)
for the people and by the people. The interpretation that
should be given it is that which reasonable minds, the
great mass of the people themselves, would give it.” Id.,
quoting Livingston Co v Dep’t of Management & Budget, 430
Mich 635, 642; 425 NW2d 65 (1988) (quoting Cooley’s Const
Lim 81) (quotation marks deleted).
4
facts of the case.
Our constitutional mandates certainly
must be afforded more than mere lip service.
Legislature
can
change,
amend,
or
repeal
a
While the
statute,
it
cannot abrogate a citizen’s constitutional right to trial
by jury.
Because the damages cap is applied automatically,
without regard to the jury’s assessment of damages, the
damages cap violates our citizens’ constitutional right to
trial by jury.
Because the right to a jury trial is a fundamental
right, the damages cap must withstand strict scrutiny to be
deemed constitutional.
Mich
650,
scrutiny
precisely
interest.
662;
487
analysis,
tailored
Id.
Doe v Dep’t of Social Services, 439
NW2d
a
166
statute
to
serve
(1992).
will
a
be
Under
upheld
compelling
a
if
strict
it
is
governmental
In this case, the alleged “compelling”
governmental interest that prompted the damages cap is the
continued viability of the automobile rental industry.
The
Legislature’s
the
response
to
the
alleged
crisis
in
automobile rental industry was to restrict recovery for the
most severely injured plaintiffs.
No matter the merits of
the claim, the Legislature restricted a victim’s damages,
resulting in an arbitrary limit on the amount of damages a
victim can recover.
This means that the victims who are
the most severely injured will have their damages reduced
5
the most, while less seriously injured victims can fully
recover.
Even if one were to agree that a crisis existed
and
such
that
governmental
a
crisis
interest,
precisely tailored.
may
the
be
considered
Legislature’s
a
compelling
action
was
not
There were numerous other measures the
Legislature could have taken, such as requiring automobile
rental drivers to be insured, that would have addressed the
alleged crisis while not making such a sweeping restriction
to our citizens’ fundamental right.
Notably,
amount
of
the
Legislature’s
recovery
from
the
decision
automobile
to
limit
rental
the
industry
makes the industry less accountable to the public, and it
is the public’s interests that are to be protected by the
statute.
Because of the damages cap, the industry has no
incentive to ensure that drivers are insured.
Assuming
that the automobile rental industry was being held liable
for damages that totaled such an amount as to threaten the
viability of the industry, then the industry necessarily
recognized
that
the
number
causing this problem.
mandate
that
drivers
of
uncollectible
drivers
was
The simple solution would be to
are
insured,
thereby
ensuring
that
victims would have a viable avenue by which to collect
damages.
6
The
concurrence
asserts
that
a
victim
still
has
a
cause of action to recover from the driver of the rented
automobile.
belies
However,
reality.
requiring
the
this
As
alternate
discussed,
automobile
rental
rental drivers are insured.
avenue
there
industry
of
recovery
is
no
mandate
to
ensure
that
An automobile rental company
can rent to an uninsured driver knowing that a severely
injured victim would likely have no way to recover from the
driver
for
any
damages
caused.
Therefore,
while
the
concurrence claims that this is an alternate avenue for
recovery, in reality, this avenue is often a dead end.
Thus, because even a cursory review of other available
measures
indicates
that
the
statute
is
not
precisely
tailored to serve a compelling governmental interest, it
cannot withstand strict scrutiny.
Therefore, the damages
cap at issue is unconstitutional.
II. EQUAL PROTECTION AND SUBSTANTIVE DUE PROCESS
Our Constitution states, “No person shall be denied
the equal protection of the laws . . . .”
1, § 2.
shall
.
Const 1963, art
Further, our Constitution provides, “No person
.
.
be
deprived
of
without due process of law.”
life,
liberty
or
property,
Const 1963, art 1, § 17.
The
test to determine if legislation comports with substantive
due process is essentially the same as the test used for
7
equal protection.
Shavers v Attorney General, 402 Mich
554, 612-613; 267 NW2d 72 (1978).
To resolve a due process
or equal protection challenge, this Court must identify the
objective
that
the
challenged
statute
seeks
to
achieve.
O’Brien v Hazelet & Erdal, 410 Mich 1, 13-14; 299 NW2d 336
(1980).
The claimed objective of implementing the damages
cap is to ensure the continued viability of the automobile
rental
industry.
objective
“is
prevention
of
However,
for
the
the
entire
benefit
unrecompensed
of
injury
statute’s
the
.
.
public
.
broader
and
.”
the
Miller
v
Manistee Co Bd of Rd Comm’rs, 297 Mich 487, 493; 298 NW 105
(1941), overruled in part by Mead v Michigan Pub Service
Comm, 303 Mich 168; 5 NW2d 740 (1942).
The
statute
classifications,
at
among
issue
them
establishes
distinguishes
it
several
between
victims who were injured by a motor vehicle and victims
injured by a rented motor vehicle.
classification,
the
statute
also
Within this latter
distinguishes
between
those with severe injuries and those with lesser injuries.
Because the classifications and the arbitrary damages cap
impermissibly interfere with a fundamental right–the right
to
trial
scrutiny.
(2003).
by
jury–the
legislation
is
reviewed
by
strict
Harvey v Michigan, 469 Mich 1, 12; 664 NW2d 767
As
explained
in
section
8
one,
the
legislation
cannot withstand strict scrutiny because, even assuming a
compelling
governmental
interest,
it
is
not
precisely
tailored.
Further,
even
evaluating
the
damages
rational-basis review, it is highly suspect.
under
rational-basis
legislation
is
review,
“‘arbitrary
it
must
and
be
wholly
cap
under
To prevail
shown
that
unrelated
rational way to the objective of the statute.’”
in
the
a
Id. at 7,
quoting Smith v Employment Security Comm, 410 Mich 231,
271; 301 NW2d 285 (1981).
A classification reviewed under
“[rational]
basis
constitutional
legislative
judgment
passes
is
supported
by
muster
any
set
of
if
the
facts,
either known or which could reasonably be assumed, even if
such facts may be debatable.”
Harvey, supra at 7.
While a plaintiff bears a heavy burden to rebut the
presumption that a statute is constitutional, it is not an
insurmountable hurdle.
Rational-basis review does not mean
that, merely because a crisis is alleged by representatives
of
an
industry,
any
action
taken
is
a
valid
and
constitutional one.
Regarding
the
damages
cap
at
issue,
there
is
no
indication that past damages awards were threatening the
automobile rental industry.
Further, a concern over future
damages awards and the viability of the automobile rental
9
industry
is
so
tenuous
rational-basis
scrutiny.
arbitrary
not
and
governmental
that
it
Because
rationally
objective,
is
unable
the
related
the
to
withstand
damages
to
damages
a
cap
is
legitimate
cap
violates
plaintiff’s equal protection and substantive due process
rights.
No matter the intentions of the Legislature, if a
statute
improperly
citizens
by
the
contravenes
Constitution,
the
we
rights
must
afforded
strike
down
our
that
legislation.
III. THE CONSTITUTIONALITY OF DAMAGES CAP IN GENERAL
The damages cap in this case differs from other forms
of remedies that affect damages awards, such as remittitur,
additur,
and
treble
damages.
Remittitur,
additur,
and
treble damages are based on the facts presented at trial.
See Moore v Spangler, 401 Mich 360, 371, 373; 258 NW2d 34
(1977); Shepard v Gates, 50 Mich 495, 497-498; 15 NW 878
(1883).
Remittitur or additur is used only after a court
has determined that a party has not received a fair trial
because
the
inadequate.
arbitrary
verdict
is
clearly
or
grossly
excessive
or
The damages cap in this case, however, is an
amount
that
limits
recovery
regardless
of
the
jury award or the facts presented at trial.
On a broader level, the impetus behind damages caps is
that they are necessary to ensure that certain defendants
10
are not driven out of business by runaway jury verdicts.
However,
ensure
our
that
justice
system
verdicts
are
has
numerous
just.
mechanisms
Summary
to
disposition,
directed verdict, judgment notwithstanding the verdict, and
remittitur
certain
are
that
all
readily
verdicts
are
available
fair.
mechanisms
And,
of
to
course,
make
our
nation’s centuries-old jury system was designed to ensure a
fair trial for all parties.
While I do not contend that a
damages
constitutional,
cap
can
never
be
we
must
not
blindly accept claims of a crisis made by those who have a
distinct interest in seeing liability limited.
Other jurisdictions have also held that damages caps
applied to various causes of actions are unconstitutional.
In Kansas Malpractice Victims Coalition v Bell, 243 Kan
333, 342, 345-346; 757 P2d 251 (1988), overruled in part by
Bair v Peck, 248 Kan 824; 811 P2d 1176 (1991), the Kansas
Supreme
Court
judgment
for
stated
less
that
than
when
the
the
jury
trial
court
verdict,
it
enters
“is
an
infringement on the jury’s determination of the facts, and,
thus, is an infringement on the right to a jury trial.”
The court further stated:
Pain and suffering have no known dimensions,
mathematical or financial.
There is no exact
relationship between money and physical or mental
injury or suffering, and the various factors
involved are not capable of proof in dollars and
11
cents.
For this very practical reason the only
standard for evaluation is such amount as
reasonable
persons
estimate
to
be
fair
compensation for the injuries suffered, and the
law has entrusted the administration of this
criterion
to
the
impartial
conscience
and
judgment of jurors, who may be expected to act
reasonably, intelligently and in harmony with the
evidence. [Bell at 346, quoting Domann v Pence,
183 Kan 135, 141; 325 P2d 321 (1958).]
In Morris v Savoy, 61 Ohio St 3d 684, 690; 576 NE2d
765
(1991),
the
Ohio
Supreme
Court
found
no
rational
relationship between a medical malpractice damages cap and
public health or welfare, and further held that the cap was
unreasonable and arbitrary.
Numerous other cases have also
held that damages caps are unconstitutional.
See also Best
v Taylor Machine Works, 179 Ill 2d 367, 409; 689 NE2d 1057
(1997) (for a list of jurisdictions); Tenold v Weyerhaeuser
Co, 127 Ore App 511, 524-525; 873 P2d 413 (1994); Henderson
v
Alabama
Power
Co,
627
So
2d
878,
891
(Ala,
1993),
overruled in part Ex parte Apicella, 809 So 2d 865 (Ala,
2001) (“[I]t is improper for the legislature to substitute
itself for the jury and to fix an arbitrary, predetermined
limit” on the jury’s award.); Brannigan v Usitalo, 134 NH
50, 57; 587 A2d 1232 (1991); Sofie v Fibreboard Corp, 112
Wash 2d 636, 638; 771 P2d 711 (1989); Condemarin v Univ
Hosp,
775
P2d
348,
364
(opinion
by
Durham,
J.),
367
(Zimmerman, J., dissenting in part and concurring in part)
12
(Utah, 1989); Lucas v United States, 757 SW2d 687, 690-691
(Tex, 1988); Coburn v Agustin, 627 F Supp 983, 996-997 (D
Kan, 1985); Carson v Maurer, 120 NH 925, 940-941, 943-944;
424 A2d 825 (1980) (“It is simply unfair and unreasonable
to
impose
the
burden
of
supporting
the
medical
care
industry solely upon those persons who are most severely
injured
and
therefore
most
in
need
of
compensation.”);
Arneson v Olson, 270 NW2d 125, 126, 135 (ND, 1978); Wright
v Central DuPage Hosp Ass’n, 63 Ill 2d 313, 329-330; 347
NE2d 736 (1976).3
The breadth of decisions from jurisdictions around our
nation
should
give
us
pause
before
we
allow
dubious
allegations to erode our citizens’ constitutional rights.
No
industry
should
be
allowed
to
shift
its
burden
of
responsibility and accountability to the shoulders of the
severely injured merely because it claims to be in crisis.
3
Although many of these deal with damages caps in
medical malpractice cases, the fact that the caps have been
deemed unconstitutional is relevant to the issue in this
case.
The medical “crisis” that has led to medical
malpractice damages caps being enacted has received much
more study than the alleged crisis in the automobile rental
industry.
Yet, as the above cases indicate, numerous
jurisdictions have rejected the arguments that the damages
caps are constitutional or necessary.
13
IV. CONCLUSION
Thomas Jefferson considered trial by jury to be “the
only anchor ever yet imagined by man, by which government
can be held to the principles of its constitution.”4
Today,
the majority casts our citizens adrift by finding their
constitutional rights are expendable merely because of an
alleged “crisis” in the automobile rental industry.
majority
merrily
jurisprudence,”
“steer[s]
ante
at
our
28,
into
economic
the
The
regulation
mainstream,
while
ignoring the citizens who are severely injured along the
way.
Therefore, I must respectfully dissent.
I would
reverse the decision of the Court of Appeals because the
damages
cap
violates
plaintiff’s
fundamental
right
to
a
jury trial, as well as plaintiff’s equal protection and
substantive due process rights.
Michael F. Cavanagh
Marilyn Kelly
4
Thomas Jefferson, Letter to Thomas Paine, July 11,
1789. Wulffrith’s Quotations,
<http://geocities.com/wulffrith_47/Quotes_tj.html>
(accessed May 20, 2004).
14
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