Merit Decision: The Constitutionality of the Mandatory Bifurcation Provision of R.C. 2315.21(B). Havel v. Villa St. Joseph.

On February 15, 2012, the Supreme Court of Ohio issued a decision in Havel v. Villa St. Joseph, 2012-Ohio-552. In a 5-2 decision (Chief Justice O’Connor concurred in judgment only) written by Justice O’Donnell, the Court upheld the constitutionality of R.C. 2315.21(B), the mandatory bifurcation provision of the punitive damages statute. This statute, as amended, was part of a larger set of tort reform measures that went into effect in April of 2005. In Arbino v. Johnson & Johnson, the Court upheld the constitutionality of 2315.21(D), the cap on punitive damages. But the bifurcation provision was not challenged in that case.

Under R.C. 2315.21(B), upon motion of any party, any tort action tried to a jury in which the plaintiff seeks both compensatory and punitive damages must be bifurcated. In the first phase, no evidence of plaintiff’s entitlement to punitive damages is permitted. If the plaintiff wins compensatory damages in that phase, a second trial is held on the question of punitive damages. Civ. R. 42(B) also deals with bifurcation. The rule gives trial judges discretion to order separate trials of any claims or issues to avoid prejudice or in the interest of judicial economy.

The Court accepted the case on conflict certification, to address this question: whether R.C. 2315.21(B) as amended by S.B. 80, effective April 7, 2005, is unconstitutional, in violation of Section 5(B), Article IV of the Ohio Constitution because it is a procedural rule that conflicts with Civ. R. 42(B).

The 1968 Modern Courts amendment gives the Supreme Court the power to create rules of practice and procedure. Article IV, Section 5(B) states that such rules shall not “abridge, enlarge, or modify any substantive right.”

When a conflict arises between a rule and a statute, the court’s rule will control for procedural matters; the legislature’s statute will control for matters of substantive law. So a two part determination is necessary. First, does a conflict exist between the rule and the statute? If so, is the statute substantive or procedural?

The plaintiff had argued that there was a conflict between the rule and the statute, and that the statute was procedural, and must yield to the rule. The defendant argued that there was no conflict between the rule and the statute, but if the Court found that there were, the statute created a substantive right which trumped the rule.

On the issue of the conflict between the rule and the statute, the majority found that while there were some instances in which the two could be applied without conflict, there was clearly a direct conflict in tort claims. Thus, it went on to consider the substantive/procedural question. To answer, the Court had to determine whether the statute created a right, concluding that it did create a mandatory right to bifurcation in tort actions (which admittedly had not existed before R.C. 2315.12 was amended by S.B. 80.) “We have previously recognized that a statute may create a right when it contains mandatory language and restricts judicial or agency discretion,” wrote O’Donnell.

The Court also looked to the language of the statute to determine whether it was substantive or procedural, and concluded that it could not tell either way from the codified portion. So Justice O’Donnell looked to the uncodified statutory language, specifically the statements of findings and intent in S.B. 80. These are the most pertinent quoted by Justice O’Donnell:

The General Assembly further declared that “[r]eform to the punitive damages law in Ohio[was] urgently needed to restore balance, fairness, and predictability to the civil justice system.” [Section 3(A)(4)(a)] and …[(f)] in cases in which punitive damages are requested, defendants should have the right to request bifurcation of a trial to ensure that evidence of misconduct is not inappropriately considered by the jury in its determination of liability and compensatory damages.” Thus, the substantive right created by this statute, according to O’Donnell, is the “right to ensure that evidence of misconduct is not inappropriately considered by the jury in its assessment of liability and its award of compensatory damages.” Interestingly, at the oral argument of the case, Justices Cupp and O’Donnell both asked, in slightly different ways, if this was the substantive right involved here.

Justice McGee Brown wrote a very strong dissent, joined by Justice Pfeifer. She agrees that the rule is clearly in conflict with the statute. But she finds that the statute is clearly about courtroom procedure—the domain of the Supreme Court—not about substantive rights. She is particularly critical of the majority for relying on what she calls “uncodified commentary” to create a substantive right. She also makes clear that just because the General Assembly intends for something to be constitutional doesn’t make it so. “Only the courts may rule on a statute’s constitutionality,” she wrote.

Case Syllabus

R.C. 2315.21(B) creates, defines, and regulates a substantive, enforceable right to separate stages of trial relating to the presentation of evidence for compensatory and punitive damages in tort actions and therefore takes precedence over Civ.R. 42(B) and does not violate the Ohio Constitution, Article IV, Section 5(B).

Concluding Observations

I correctly saw this as a split decision, but was wrong that a majority appeared ready to strike down the statute. A majority of this Court is particularly legislative-deferent, particularly Justices O’Donnell and Cupp—the two who asked the key questions in this case. I find the use of uncodified statutory language to determine legislative intent troubling. Like many states, Ohio has no formal legislative history of statutes in the way Congress does. In recent years the legislature has increasingly used what Justice McGee Brown called “uncodified commentary” as the formal statement of its intent. In State ex rel. Ohio Academy of Trial Lawyers v. Sheward, 86 Ohio St.3d 451, 1999-Ohio-123, a seminal case striking down many tort reform measures, the majority was very critical of a number of instances where the legislature used those kinds of statements of intent “proclaiming to respectfully disagree” with the court’s constitutional interpretations. To underscore the fact that it is a new day, one of the arguments that the plaintiff had made in this case was that certain dicta in the Sheward case describing a former version of R.C. 2315.21(B) as procedural should control in this case. Justice O’Donnell gave that the back of his hand—“despite the similarity, Sheward never considered the bifurcation question we confront in this case. Thus we are not required to follow out-of-context dicta as precedent.”

One last thing, albeit with the caveat that I haven’t practiced in a very long time. The bifurcation requirement that the Court has just upheld seems very impractical. In the vast majority of tort cases in which compensatory damages are awarded, there are absolutely no grounds for punitive damages, and that is apparent in the underlying action. Now, though, a second trial or phase of the first trial will be necessary to consider that issue separately. But, as another old saw tells us, the wisdom (or lack) of any piece of legislation is not the Court’s concern.