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October/November
2005
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Lawyer Teacher Provocateur Advocate Challenger Mentor Friend Scholar Husband Father Churchman Counselor Reliable ally |
Fierce opponent Grandfather Son Hunter Fisherman Outdoorsman Analyst Raconteur Companion Exemplar Pro Bono Servant Community Servant Storyteller
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Sly humorist
A man’s man
A woman’s delight
Friend to the downtrodden
Civil libertarian
Constitutionalist
Champion of prisoners and the accused
And from my personal perspective, as Executive of the Bar Association,
Staunch Leader of the organized bar.
He worked with many bar groups but none so faithfully as he did with The Virginia Bar Association.
As you must know, the VBA has led many causes in the interest of law reform and the administration of justice over the years, but Roger Groot personally changed the emphasis of the VBA in modern times to prioritize the interest of the constitutional conduct of the criminal defense system so long neglected and underfunded in Virginia.
He chaired the legislative committee of the VBA Criminal Law Section; he served as the most effective Section Chair in memory. You here know he was intensely involved in establishing the current credibility of this annual workshop which is in its 13th edition, the third largest VBA-related meeting each year.
Roger came on the Board of the VBA four years ago as our Law Faculty representative and served in that key role longer than has anyone else.
But the critical thing was not positions held, but the leadership made effective. He has led the VBA advocacy on indigent defense both as to public defenders and appointed counsel—as to compensation and as to the substantive law of such representations. These are now the unquestioned first priority of our Association as we enter the 2006 General Assembly session. We hope for success. If there is, we need to realize Roger was the indispensable man in this calling. We cannot let our efforts flag or fail despite his loss.
Returning to the Bard, we can say:
Roger Groot was a man. Take him for all in all. We shall not look upon his like again.
Amen.
To the 13th Annual Capital Defense Workshop
November 17, 2005
Breck Arrington
Executive Vice President, The Virginia Bar Association
Hurricane Katrina Response:
Legal community donates dollars, steps forward
in volunteering services to storm-ravaged areas
On August 31, The Virginia Bar Association announced the
creation of a fund, through the VBA Foundation, to rebuild the legal infrastructure
of the Gulf Coast states hit by Hurricane Katrina.
Within hours, Virginia’s legal community began an unprecedented outpouring
of generosity of monetary gifts and volunteer time, resulting in the largest
relief fund in VBA history which far surpassed previous assistance efforts.
Buoyed by strong support from the Virginia State Bar, well-placed articles
in the Richmond Times-Dispatch and Virginia Lawyers Weekly,
and tireless behind-the-scenes work to promote the fund and facilitate
contributions, the VBA Foundation’s Hurricane Katrina Legal Assistance
Fund has received more than $96,000 to date.
While past VBA legal relief fund drives had achieved measurable levels of success, this fundraising effort was driven by the enormity of the Katrina disaster, as reported round-the-clock by news media, and the effects of the devastation on relatives, friends and colleagues of VBA members and staff.
The ability of the VBA to communicate electronically
with members, unavailable in earlier fundraising efforts, also played
an important role. An online donation form, set up on the VBA website
in the fund’s first week of existence, brought in several hundred
dollars within minutes.
One of the largest contributions, of more than $28,000, came from the
Williams Mullen Foundation, through the efforts of VBA President Jim Meath,
a partner in the law firm.
Donations of $36,000 each were sent to the Mississippi Bar Foundation and the Baton Rouge Bar Foundation (home of the Louisiana State Bar Association’s legal relief fund, as the LSBA offices were in flooded-out downtown New Orleans) in early October. The Alabama bar, while affected by the hurricane in several areas of the state, directed contributions to the efforts in the more heavily damaged neighboring states.
Contributions continued to roll in through October, thanks
to follow-up articles in such media as The Free Lance-Star and
Richmond.com. The Lewis Law Firm and Glenn Lewis family made a generous
contribution to the secondary phase of the fund. Additional donations
will be shared, with the concurrence of Mississippi, with the Louisiana
bar fund as the most hard-hit state legal system.
Support for provision of legal services in the Gulf Coast
states went beyond the financial. As in past crises, the VBA Young Lawyers
Division Disaster Legal Assistance Committee joined with the VSB Young
Lawyers Conference Emergency Legal Services Committee to assess the situation
and recruit lawyer-volunteers for legal assistance efforts.
By mid-October, more than 400 Virginia lawyers had signed
on as providers of pro bono publico legal services to Hurricane Katrina
survivors, and the VBA and VSB committees, working together, had held
three volunteer training sessions.
The Virginia Bar Association Foundation is organized as
a Section 501(c)(3) entity within the Internal Revenue Code to conduct
and support charitable and educational purposes of the VBA.
In addition to the VBA Foundation Patron Program, which recognizes contributors
at three giving levels, the Foundation welcomes gifts in memory of deceased
family, friends and colleagues, or in honor of a
special person or event, are also welcomed by the VBA Foundation. All
gifts are fully deductible as provided by IRS guidelines.
For more details, visit www.vba.org or call the VBA office at (804) 644-0041. VBA
See below for a list of contributors as of November 15, 2005. Additional gifts will be noted in future issues of the VBA News Journal.
| C.W. Adler Hon. Rossie D. Alston Jr. Phillip Anderson Briggs W. Andrews Anonymous Marjorie L. Arnheim Anna H. & Breck Arrington Robert J. Barry Kieran H. Bartley Robin W. Baxter Ruth S. Bergin Lisa A. Bertini D.E. Boehling Rhonda D. Bond-Collins Carolyn A. H. Bourdow Leigh Anne Bowling Hon. William G. Broaddus Burke, Graybeal & Hammer Jack W. Burtch Jr. Caroline B. Cardwell Elizabeth B. Carroll Carter, Osborne & Miller Tara L. Casey Amy B. Cathey R. Paul Childress Jr. Childress, Gould & Russell, PC Donna S. Clark R. Clinton Clary Jr. James K. Cluverius Barbara Rose Cohen Edwin S. Cohen Cranwell & Moore, PLC Ann K. Crenshaw Steven L. Dalle Mura John N. Dalton, Jr., PC Donna R. Deloria Rajan A. Desai Alan Dockterman Ann S. Dodson William D. Dolan III Melissa A. Dowd Carroll E. Dubuc W. Jeffrey Edwards E. Tazewell Ellett Heather H. Embrey, LLC Patricia Epps John Epps Karen C. Fagelson Jory H. Fisher Frankl Miller & Webb, LLP Jeanne F. Franklin Mary S. Frayser Robert L. Freed Michael V. Frett Frith, Anderson & Peake Gentry Locke Rakes & Moore LLP Jackson B. Gilbert Marvin S. Gittes Joseph W. Gorrell Barbara W. Goshorn, PC Karen A. Gould Robert S. Greenlief Phillip S. Griffin, PC Carolyn Grimes Richard E. Hagerty Michelle Halasz Amy L. Harman Harman, Claytor, Corrigan & Wellman, PC Therese K. Hathaway Mark S. Hedberg Hefty & Wiley, P.C. Lucy P. Homiller Dennis M. Hottell & Assocs. Michael L. Houliston, P.C. A.E. Dick Howard Barry W. Hunter Eppa Hunton Hunton & Williams LLP Phillip L. Husband John Paul Jones Kaufman & Canoles Anne Leigh Kerr Eric G. King C. Shireen Kirk Tracy S. Kissler, PC Stephen K. Kitchen A. L. Knighton Jr. Charles E. Land The Lewis Family and The Lewis Law Firm, PC Thomson Lipscomb Ralph Lohmann Audrey Marcello |
Sandra S. Marchenko |
Legal Focus/Civil
Litigation:
Getting a Handle on the Basics of ‘Hybrid’ Witnesses in Virginia
Federal and State Practice
Jon M. Talotta and Michael M. Smith
In many cases, a client’s employee (or ongoing professional
services provider, such as a treating physician) will possess the specialized
knowledge, skill or experience to provide opinion testimony as well as
be able to testify about relevant facts based on first-hand knowledge.
The use of a so-called “hybrid” (i.e., fact and expert) witness
can enhance the effectiveness of opinion testimony where the opinion was
formed from first-hand knowledge rather than a subsequent review of the
relevant facts. Hybrid witnesses also can reduce both the costs otherwise
associated with retaining a litigation expert and the time required to
bring the hybrid witness up to speed on the relevant facts and issues.
With such attractive benefits, it is little wonder that the use of hybrid
witnesses is growing.
Yet the decision to designate an employee (or professional services provider) as a hybrid witness raises issues for both counsel and opposing counsel. For example, how do state and federal courts in Virginia treat hybrid witnesses? How should a witness be designated during pre-trial discovery (i.e., as a hybrid witness or a retained expert) if at all? What discovery should opposing counsel conduct? Answering these and other questions often involves some tricky forecasting.
Hybrid or Expert?
A “hybrid” witness is a fact witness who also happens to have
the requisite knowledge, skill or expertise to provide opinion testimony,
and whose opinion is formed as a result of the witness’s involvement
in the underlying relevant events. For example, a treating physician who
proffers an opinion based on her/his personal observations as a participant
in the treatment of a patient is the stereotypical hybrid witness. Businesses
are relying more frequently on their own employees to provide opinion
testimony as well as factual testimony. Common examples are engineers,
software developers, and accountants with specialized knowledge, skill
or expertise who are employed or retained by a litigant in the normal
course of business.
The Federal Rules Require That Counsel Commit Early
to a Specific Designation
In federal practice, there is a relatively clear distinction drawn between
discovery of a retained expert and a hybrid witness. The admissibility
of opinion testimony is governed by Federal Rule of Evidence 702. But,
in pre-trial discovery, retained experts are subject to mandatory disclosure
under Rule 26(a)(2), and must disclose specified information as well as
a written report detailing the substance of and bases for an expert’s
proposed opinion testimony. Hybrid witnesses are not subject to these
same disclosure requirements, and must only be identified as witnesses
who may provide opinion testimony at trial.
Yet the distinction between retained expert and hybrid
witness is not always easy to discern. Opinions formed in the course of
a witness’s employment (or, for example, in the course of treatment
in the context of a treating physician) usually will not be deemed to
require designation as a retained expert. Opinions formed in the context
of litigation (i.e., outside the employment context or after treatment
or other services have been provided) usually will be deemed to require
designation as a retained expert and be subject to Rule 26(a)(2)’s
disclosure requirements. Thus, the failure to appreciate the differences
between a retained expert and a hybrid witness can be, as one district
court observed, “a trap for the unwary.”1
Because of the different disclosure requirements, it is
important for counsel to determine in advance whether a proposed witness
can qualify as a hybrid rather than a retained expert. This is particularly
important where counsel does not want the witness to be bound by Rule
26(a)(2)’s disclosure requirements. If counsel concludes that a witness
qualifies as a hybrid, he/she may choose not to follow the mandatory disclosure
requirements for retained experts. If, however, the witness subsequently
cannot qualify as a hybrid, but rather is deemed to be a retained expert,
the witness may be barred from providing any opinion testimony.2
Opposing counsel also must be mindful of the hybrid/retained expert witness distinction. If opposing counsel fails to realize that the witness is a hybrid, and sits back waiting for mandatory disclosures, she/he may lose the opportunity to discover the witness’s proposed opinions prior to trial.3
Virginia State Practice Appears to Require Similar
Diligence
In Virginia state practice, the admissibility of opinion testimony is
guided by §§ 8.01-401.1 and 401.3 of the Virginia Code. Unlike
the Federal Rules, however, Virginia law does not require disclosures
for retained experts.4 Absent a court order, discovery
of a retained expert is conducted much like discovery of a hybrid witness
in federal practice (i.e., through deposition and interrogatories to obtain
the identity of the expert, the subject matter of the proposed testimony,
the facts and opinions to be offered, and a summary of the grounds for
those opinions).5
Nevertheless, a party who fails to identify an expert
upon request during pre-trial discovery will usually be precluded from
presenting that expert at trial.6 Thus, counsel must
decide up front whether the witness can qualify as a hybrid rather than
a retained expert.
The same factors determining whether a witness can qualify
as a hybrid rather than a retained expert in federal practice appear to
apply in Virginia state practice. One recent Supreme Court of Virginia
case seems to provide some guidance. In Pettus, a medical malpractice
case, the defendant physician offered into evidence the deposition of
another physician witness who had treated the plaintiff. The plaintiff
objected, arguing that the deposition testimony was inadmissible because
it was expert testimony. The Court disagreed, holding that the deposition
was not expert testimony because it served only to explain impressions
and conclusions reached while treating the plaintiff, rather than stating
the physician witness’s present opinions.7
Although Pettus dealt directly with a different
set of issues regarding expert testimony, the Court’s reasoning seems
to acknowledge the distinction between a hybrid witness and a retained
expert usually followed under the Federal Rules. A recent Virginia state
circuit court case suggests that this is the accepted view in Virginia
practice. The issue in Villar-Gonsalvez was whether a treating
physician was a retained expert and therefore entitled to expert witness
compensation. The court held that the physician was a retained expert
rather than a hybrid witness (and thus entitled to payment), because the
witness was asked to opine on issues not considered while the witness
was actually treating the patient.8
Thus, whether in state or federal practice, counsel must consider carefully the type of opinion a witness will be offering in order to assess whether the witness can be deemed a hybrid.
Practical Considerations Concerning Pre-Trial Disclosure
and Discovery
The decisions in Pettus and Villar-Gonsalvez are instructive
because the courts distinguished between an expert witness effectively
“retained” to provide opinion testimony and a witness who proffered
opinion testimony based on first-hand experience as an actor in the underlying
events. Yet, neither case resolves the issues of (a) whether a hybrid
witness must be identified as an expert, and (b) the type of discovery
applicable to a hybrid witness in Virginia state practice. Guidance on
these issues may be found in cases construing Federal Rule 26(b)(4) prior
to its amendment in 1993, which mirrored Virginia’s current Rule
4:1(b)(4), as well as case law from states that have adopted expert witness
rules with identical or very similar language.9
Pre-Trial Disclosure of Hybrid Witnesses
Several federal and state courts have addressed the issue of whether the
language in or similar to Virginia’s Rule 4:1(b)(4) requires the
identification of hybrid witnesses during pre-trial discovery. Unfortunately,
there appears to be no clear consensus. In one case, a Georgia federal
district court held that a plaintiff’s failure to identify her treating
physicians as expert witnesses during pre-trial discovery precluded her
from offering the physicians’ opinion testimony at trial.10
The Supreme Court of Alaska, however, reached the opposite conclusion
in construing a rule with language similar to Rule 4:1(b)(4). In that
case, the court held that a defendant was not required to identify as
an expert witness the police officer who investigated a traffic accident
and later offered opinion testimony at trial, because the policeman was
“intimately involved” in the underlying facts giving rise to
the litigation, and would reasonably be expected to form an opinion through
that involvement.11
This lack of guidance makes it difficult for counsel to predict how a Virginia court will rule on pre-trial identification requirements for hybrid witnesses, and should caution counsel in most instances to take the safer route and elect to disclose.
Pre-Trial Discovery of Hybrid Witnesses
Fortunately, there appears to be a bit more guidance available on
defining the contours of hybrid witness discovery. As noted, discovery
of expert witnesses in Virginia state practice is limited to deposition
and interrogatories requesting the identity of the expert, the subject
matter of the proposed testimony, the facts and opinions to be offered,
and a summary of the grounds for the proposed opinions. These limitations
likely do not apply to hybrid witnesses. Several federal courts interpreting
the pre-1993 Federal Rule 26 (which, as noted, was virtually identical
to Virginia’s current Rule 4:1) have concluded that hybrid witnesses
are to be treated as ordinary fact witnesses for discovery purposes to
the extent that the discovery pertains to facts acquired and opinions
formed by the witness as an actor in connection with the subject matter
of the litigation.12
For example, in Duke Gardens, a federal district
court case in New York, the defendant sought to depose three employees
of a company the plaintiff had hired before the commencement of the litigation
to inspect structures at issue in the lawsuit. The plaintiff objected
to the defendant’s attempts to discover what the employees learned
during their pre-litigation inspections, arguing that the employees were
being called as expert witnesses and thus could not be deposed on those
findings absent a court order. The court held that the pre-litigation
inspections were discoverable by ordinary means, because the information
requested was obtained by the employees in connection with the underlying
subject matter of the litigation, rather than as experts retained for
litigation purposes.13
The decision in Duke Gardens and other similar holdings appear aimed at preventing parties from using the label of expert to shield from ordinary discovery a witness with first-hand knowledge of underlying facts. It seems likely that a Virginia court faced with the same situation would follow such reasoning when assessing the scope of discovery on a hybrid witness.
Conclusion: Putting Your Designation Determination
Into Context
The strategic considerations involved in handling a hybrid witness can
have far-reaching consequences in Virginia federal and state practice.
In federal practice, the motivations to treat a witness as a hybrid can
be significant, because designation as a retained expert will trigger
mandatory disclosure requirements (including the filing of a report).
Yet, although counsel may be inclined to treat a witness as a hybrid in
order to limit the amount of information disclosed and the costs of preparing
an expert report, the nature of the witness’s opinions may require
that the witness be designated as a retained expert. Because Virginia
state practice does not require written disclosures, and because treating
a witness as a hybrid rather than a retained expert may affect the extent
of discovery opposing counsel may obtain from the witness, there appear
to be incentives to disclose an opinion witness as a retained expert,
particularly because failing to disclose a retained expert can result
in the exclusion of her/his testimony.
Thus, whether in federal or state practice, it is usually safer to designate an opinion witness as a retained expert rather than attempt to treat the witness as a hybrid. VBA
NOTES
1. Sullivan v. Glock, 175 F.R.D. 497, 501 (D. Md.
1997).
2. For an illustrative discussion of these potential quandaries,
and the parameters for assessing whether a witness can qualify as a hybrid,
see Sullivan, 175 F.R.D. at 500-508.
3. Id.
4. Virginia courts do issue scheduling orders requiring
disclosure of the identities of expert witnesses and information about
experts otherwise available through interrogatories and depositions under
Rule 4:1(b)(4).
5. See, e.g., Flora v. Shulmister, 546 S.E.2d 427,
430 (Va. 2001).
6. See, e.g., City of Hopewell v. County of Prince
George, 397 S.E.2d 793, 797 (Va. 1990).
7. Pettus v. Gottfried, 606 S.E.2d 819, 824-25
(Va. 2005). Note, however, that the Court did not discuss in its opinion
whether the physician witness was identified as an expert by the defendant.
8. Villar-Gonsalvez v. Villar-Gonsalvez, 65 Va.
Cir. 96, 100-01 (2004).
9. The Virginia courts themselves have looked to such
outside authorities for assistance. See, e.g., Flora, 546 S.E.2d
at 430; Villar-Gonsalvez, 65 Va. Cir. 96.
10. Chakales v. Hertz, 152 F.R.D. 240, 242 (N.D.
Ga. 1993); see also Smith v. Paiz, 84 P.3d 1272 (Wy. 2004) (similar
reasoning and outcome).
11. Getchell v. Lodge, 65 P.3d 50, 55-56 (Ak.
2003); see also, Kehr v. Knapp, 136 S.W.3d 118 (Mo. Ct. App. 2004)
(similar reasoning and outcome).
12. See, e.g., Duke Gardens Found. v. Universal Restoration,
52 F.R.D. 365 (S.D. N.Y. 1971); Nelco Corp. v. Slater Electric,
80 F.R.D. 411 (E.D. N.Y. 1978); Keith v. Van Dorn Plastic Machinery
Co., 86 F.R.D. 458 (E.D. Pa. 1980).
13. Duke Gardens, 52 F.R.D. at 366-67.
Legal Focus/Civil
Litigation:
Preserving Your Client’s Claim for Attorneys’
Fees: Recognizing When a Simple Claim for Attorneys’ Fees Is Not
So Simple
Robert A. Angle and Michael E. Lacy
The ability for your client to recover its attorney’s
fees is often a very powerful tool in the course of litigation. In some
instances, the fees are worth more that the underlying claim. While it
is simple enough to request an award of attorney’s fees, two recent
cases — Lee v. Mulford, 269 Va. 562, 611 S.E.2d 349 (April 22, 2005),
and Safrin v. Travani Pumps USA, Inc., 269 Va. 412, 611 S.E.2d 352 (April
22, 2005) — show the pitfalls that can arise in preserving such claims.
Similarly, a third recent case, Carolina Power and Light Co. v. Dynegy
Marketing and Trade, 415 F.3d 354 (4th Cir. July 20, 2005), underlines
the importance of recognizing the nature of one’s claim for attorneys’
fees, i.e., by contract or statute, and whether it is part of the underlying
substantive claim or an element of damages. In short, these three recent
cases show that making a simple claim for attorneys’ fees may not
be so simple.
In Lee v. Mulford, Wayne M. Lee sued to enforce a promissory
note. The note allowed recovery of his attorney’s fees and costs
as an expense of collection under the note. During the jury trial, Lee
did not present evidence of attorney’s fees, instead relying on the
customary practice of handling the claim through “post-trial motion
where [parties can] put on an expert if necessary.”1 After the jury
returned a verdict in Lee’s favor, Lee asked the court for a post-trial
hearing on fees, but the trial court denied Lee’s request for fees.
On appeal, Lee argued that “‘it is customary to argue the issue
of fees post-trial.’”2 While the Supreme Court acknowledged
that parties commonly agree to bifurcate the trial (with the concurrence
of the court) and deal with attorney’s fees after a determination
of liability, it found no such agreement in Lee’s case. The Court
noted that “neither party cites any authority for the proposition
that custom and practice, if proved, may alter the substantive rights
of the parties otherwise provided by case law, statute, or pursuant to
the Rules of Court.”3 Finding that Lee’s argument “would,
in effect, raise custom and practice to the status of local rule,”
the Court rejected Lee’s argument and affirmed the trial court’s
ruling.4
On the same day that it issued its opinion in Lee, the
Supreme Court decided Safrin v. Travani Pumps USA, Inc. In Safrin, Travani
Pumps USA (Travani) filed a confession of judgment to collect on a promissory
note. The confession of judgment allowed recovery of attorney’s fees,
but Travani did not submit evidence of attorneys’ fees when it confessed
judgment against Safrin. Eight months after obtaining the confession of
judgment, Travani moved to reinstate the case and asked the trial court
to award the attorneys’ fees Travani incurred while trying to collect
on the confession on judgment. The trial court, rejecting Safrin’s
argument that the confession of judgment was a final judgment under Rule
1:1 of the Rules of the Supreme Court of Virginia, modified its prior
judgment and awarded Travani’s fees.
On appeal, Travani argued that the confession of judgment
form incorporated language in the underlying promissory note allowing
recovery of fees incurred in collecting under the note, thus giving the
trial court continuing jurisdiction to award fees for collection as they
were incurred after the confession of judgment. The Supreme Court rejected
this argument, stating that “when an instrument forms the basis of
a debt and authorizes an award of attorney’s fees, but does not provide
a formula for liquidating the amount of those fees at the time of entry
of a judgment, no award of fees may be made except for fees actually incurred.”5
The Court concluded that, under Virginia Code § 8.01-432,6 a confession
of judgment was a final judgment under Rule 1:1, and the trial court thus
lacked jurisdiction to reinstate the case and award fees to Travani.
The holdings in Lee and Safrin show the potential procedural
pitfalls that can arise in recovering attorneys’ fees under the terms
of a contract. Taken together, these cases suggest that, absent an agreement
with opposing counsel (and concurrence of the court), a party must offer
evidence of its fees in its case-in-chief to recover them. But the Fourth
Circuit’s recent decision in Carolina Power & Light Co. v. Dynegy
Marketing & Trade raises additional questions about this issue. In
that case, Carolina Power & Light Co. (Carolina) breached a contact
to purchase certain amounts of coal from Dynegy Marketing & Trade
(Dynegy) at predetermined prices. The district court awarded Dynegy approximately
$10 million under the contract’s liquidated damages provision and
reserved “‘for a later date’” Dynegy’s claim
for attorney’s fees under the contract’s “legal costs”
provision.7 Carolina thereafter filed a notice of appeal, but Dynegy moved
to dismiss the appeal as untimely under Fed. R. App. P. 4(a)(1)(A) because
it was filed 31 (rather than 30) days after entry of the judgment. In
response, Carolina quickly changed its tune and argued that its appeal
of the judgment was premature because the district court had not resolved
the “legal costs” issue and was not yet “final.”
Before the Fourth Circuit, Dynegy argued that the trial
court’s judgment was “final” under Budinich v. Becton Dickinson
& Co., 486 U.S. 196 (1988), which held that a decision on the merits
of an employment discrimination claim was final even though the district
court had not resolved a motion for attorney’s fees under a fee-shifting
statute. Carolina argued that the holding in Budinich was distinguishable
because (1) its request for attorneys’ fees was pursuant to a contract,
not a statute, and (2) the fee-shifting statute in Budinich only awarded
fees to the prevailing party, whereas the legal costs provision in the
contract did not require a determination of the prevailing party. In resolving
this dispute, the Fourth Circuit (Niemeyer, J.) looked to Fed. R. Civ.
Pro. 54(d)(2), which was amended in response to the Budinich decision.
Rule 54(d)(2) provides that:
Claims for attorneys’ fees and related nontaxable
expenses shall be made by motion unless the substantive law governing
the action provides for the recovery of such fees as an element of damages
to be proved at trial.
The court held that Rule 54(d)(2) “creates a division
in the handling of attorneys fees claims between claims that are not part
of the underlying substantive claim, which must be made by motion, and
claims that are an element of damages, which presumably must be made by
complaint.”8 Thus, a “district court decision that leaves unresolved
a claim for attorneys fees that are sought as an element of damages under
the substantive law is not a final decision within the meaning of 28 U.S.C.
§ 1291.”9
Applying these principles, the Fourth Circuit held that
Dynegy’s recovery of legal costs under the contract was an element
of damages that had to be proved at trial, rather than raised by post-trial
motion.10 The court found that, under the contract, legal costs were recoverable
“as a remedy for the buyer’s failure ‘to accept all or
any part of the quantity of Coal to be delivered under [the contract].’”11
Hence, Dynegy’s right to recover legal costs accrued upon Carolina’s
rejection of Dynegy’s delivery of coal, not when the case was filed
or after prevailing in the litigation.12 In essence, Dynegy’s claim
for legal costs was a “stand-alone” claim that could “be
brought as an independent claim.”13 Thus, “[w]hen a stand-alone
claim for attorney’s fees remains unresolved, a district court decision
is not final for purposes of appeal.”14
In reaching this conclusion, the Fourth Circuit noted
that other circuits have implemented “bright-line” rules by
treating “contractual awards of attorney’s fees as collateral,
without considering whether the contract at issue provided such awards
as an element of damages or as costs to the prevailing party.”15
Judge Niemeyer rejected such a bright-line approach, concluding that the
benefits of such a bright-line rule are outweighed by the “well-established
rule that a judgment is not final until damages are fixed.”16 Judges
Wilkinson and Widener, however, each authored concurring opinions to provide
further commentary on this issue. In Judge Widener’s concurring opinion,
he expressed approval for a bright-line approach and quoted Brandon, Jones,
Sandall, Zeide, Kohn, Chalal & Musso, P.A. v. Medpartners, Inc., 312
F.3d 1349, 1355 (11th Cir. 2002) (“In [the Eleventh Circuit], a request
for attorneys fees pursuant to a contractual clause is considered a substantive
issue; and an order that leaves a substantive fees issue pending cannot
be ‘final.’”).17 In Judge Wilkinson’s concurrence,
he noted that some contracts may not be clear on whether recovery of attorney’s
fees are part of the substantive claim, and suggested that in such “ambiguous
or hybrid cases, an appeal should be immediately allowed.”18
As evidenced by the three opinions issued in Carolina
Power, there are subtle differences in the rules that courts may apply
to contractual claims for attorneys’ fees. The Supreme Court of Virginia,
however, has not indicated what rule it would apply. Thus, in light of
Lee, Safrin, and Carolina Power, counsel are advised to take care in preparing
and preserving a claim for attorneys’ fees pursuant to contract.
Counsel must be proactive and cannot rely on any “customary practice”
to argue issues of attorneys’ fees post-trial. Counsel should determine
whether a claim for fees is an element of damages in the underlying claim,
and if so, take the necessary steps to prove that claim, including designating
an expert on fees by the designation deadline and putting on evidence
of fees in his case-in-chief. Even when the attorneys’ fee claim
is not part underlying claim, counsel would be well served to obtain clarity
from the court on how and when a claim for attorneys’ fees must be
proved. In short, a simple claim for attorneys’ fees may not be as
simple as it first appears, a fact that counsel in Lee and Safrin learned
the hard way.
NOTES
1. Id. at 564, 611 S.E.2d at 350.
2. Id. at 565, 611 S.E.2d at 350.
3. Id. at 566, 611 S.E.2d at 351.
4. See Va. Code Ann. § 8.01-4 (allowing
district and circuit courts to prescribe local rules).
5. Id. at 418; 611 S.E.2d at 356.
6. Section 8.01-432 states:
Any person being indebted to another person, or any attorney-in-fact pursuant
to a power of attorney, may at any time confess judgment in the clerk’s
office of any circuit court in this Commonwealth, whether a suit, motion
or action be pending therefor or not, for only such principal and interest
as his creditor may be willing to accept a judgment for, which judgment,
when so confessed, shall be forthwith entered of record by the clerk in
whose office it is confessed, in the proper order book of his court. Such
judgment shall be as final and as binding as though confessed in open
court or rendered by the court, subject to the control of the court in
the clerk’s office of which the same shall have been confessed.
7. 415 F.3d at 355.
8. 354 F.3d at 358. See also Rule 58(c): “[E]ntry
of judgment may not be delayed, nor the time for appeal extended, in order
to tax costs or award fees, except” that “when a timely motion
for attorney fees is made under Rule 54(d)(2), the court may act before
a notice of appeal has been filed and has become effective to order that
the motion [delay the time for appeal].”
9. Id. at 359.
10. Id. at 360.
11. Id.
12. Id. “Unlike the circumstances in
Budinich, where the attorney’s [sic] fees award depended on
whether the claimant was a prevailing party in an underlying cause of
action, the attorney’s fees here would be awarded as part of the
damages for Dynegy’s breach of contract claim. The resolution of
such a claim is not collateral to the action, but part of it to be resolved
under the substantive law governing the outcome of the action.”
Id. at 360.
13. Id.
14. Id.
15. Id. at 362. See, e.g., U.S. ex rel.
Familian Northwest, Inc. v. RG&B Contractors, Inc., 21 F.3d 952,
955 (9th Cir. 1994) (finding that the “need for a bright-line rule”
justifies treating contractual attorneys fees as collateral); First Nationwide
Bank v. Summer House Joint Venture, 902 F.2d 1197, 1199 (5th Cir. 1990)
(adopting a “bright line” rule that attorneys fees sought under
a contract are collateral). But see, e.g., Brandon, Jones, Sandall,
Zeide, Kohn, Chalal & Musso, P.A. v. Medpartners, Inc., 312 F.3d
1349, 1355 (11th Cir. 2002) (holding that “a request for attorneys’
fees pursuant to a contractual clause” is substantive and must be
resolved before a judgment becomes final); Justine Realty Co. v. Am.
Nat’l Can Co., 945 F.2d 1044, 1048-49 (8th Cir. 1991) (holding
that, when a party seeks to recover attorneys fees as “a portion
of the contractual benefits in issue,” the judgment is not final
before the court resolves the issue of attorneys fees).
16. Id.
17. Id. at 363.
18. Id.
Legal Focus/Civil
Litigation:
Social Compact as Law: The Workers’ Compensation Act
& the Wicked Sisters of the Common Law
Hon. D. Arthur Kelsey
Editor’s Note: Judge Kelsey delivered this speech, which has been edited and annotated for publication, at the 2004 Virginia CLE Conference on Workers’ Compensation Law.
I. The Un-Common Law Response to the Industrial Revolution
In the agrarian economy preceding the industrial revolution, laborers
enjoyed a form of workplace autonomy that has since been lost to history.
By and large, they fashioned their own tools and determined the precise
methods of accomplishing their work. As long as the crops came in on time,
the landowning class took little interest in dictating exactly how the
work got done. The industrial revolution that swept through the West during
the late 1800s, however, radically withdrew any semblance of worker autonomy.
Laborers began to work in factories using machines built by others having
only marginal, if any, interest in worker safety. The self-directed nature
of working with the soil gave way to the highly regimented nature of working
with machines.
In theory, but hardly in practice, employees in 19th-century factories
were protected by their employer’s duty “to provide employees
with a reasonably safe place in which to work.”1
Whatever succor this duty provided to employees, it soon surrendered to
the “unholy trinity” of employer defenses: contributory negligence,
assumption of risk, and the fellow servant rule.2 They
became the “wicked sisters” of the common law because, working
together, they effectively nullified any realistic possibility of holding
an employer liable for the great majority of on-the-job injuries.3
Dean Prosser explained the underlying rationale of the common law approach
this way:
The cornerstone of the common law edifice was the economic theory that there was complete mobility of labor, that the supply of work was unlimited, and that the worker was an entirely free agent, under no compulsion to enter into the employment. He was expected therefore to accept and take upon himself all of the usual risks of the trade, together with any unusual risks of which he had knowledge, and to relieve the employer of any duty to protect him.4
The common law suffered its first defeat at the hands
of a continental civil law jurisdiction. In 1884, Germany enacted the
first worker compensation system.5 Thirteen years later,
Britain enacted a similar statute reciting the now universally famous
coverage formula: “arising out of and in the course of employment.”6
This statute adopted an “intermediate position that imposed upon
the employer a qualified form of negligence liability.”7
Shortly after the English parliament passed its compensation
statute, the concept moved across the Atlantic.8 States
rushed to enact worker compensation systems after the United States Supreme
Court upheld the constitutionality of New York’s system in 1917.9
By 1949, every state had enacted some form of workers’ compensation
statute.10 Among the principal reasons for the spreading
interest in the compensation statute, Professor Larson explained, was
the efficiency that would result from placing the enforcement of the statute
“in the hands of administrative commissions” using relaxed procedural
and evidentiary requirements.11
The idea first surfaced in Virginia during the 1914 legislative session. In his inaugural address to the legislature, Governor Henry Carter Stuart strongly endorsed the concept as one worthy of “a time when the spirit of human brotherhood influences the conduct of government and society in an unprecedented degree.”12 The spirit did not move the legislators, however, for another four years. In 1918, the General Assembly enacted Virginia’s first workers’ compensation legislation.
Modeled after Indiana’s statute, the Virginia Act
intended to:
• create “the certainty that compensation will be paid”
and thus contribute to the “contentment of the worker,”
• give the employer the confidence that “the sums paid by him,
or by his insurer, [will] go directly and in full to his injured workman,”
• produce “efficiency” and result in the “elimination
of waste in the litigation of claims,”
• provide “definite and timely relief without the uncertainty
and expense of a law suit,”
• relieve civil courts of the “time and expense” of “negligence
cases” which have “crowded their dockets,” and
• reduce “poverty and destitution” by increasing “the
number of awards granted by abolishing the common law defenses available
to employers.”13
The idealism animating the legislation served more as
an anodyne for past frustrations than a blueprint for realistic future
goals. The Virginia Supreme Court summarized the widespread discontent
with the status quo this way:
Both had suffered under the old system, the employers by heavy judgments, of which half was opposing lawyer’s booty, the workmen through the old defenses or exhaustion in wasteful litigation. Both wanted peace. The master, in exchange for limited liability, was willing to pay on some claims in [the] future, where in the past there had been no liability at all. The servant was willing not only to give up trial by jury, but to accept far less then he had often won in court; provided he was sure to get the small sum without having to fight for it. All agreed that the blood of the workman was the cost of production, that the industry should bear the charge.... To win only after litigation, to collect only after the employment of lawyers, to receive the sum only after months or years of delay, was to the comparatively indigent claimant little better than to get nothing. The workmen wanted a system entirely new. It is but fair to admit that they had become impatient with the courts of law.14
Given this antipathy with the tort-based legal system,
the architects of workers’ compensation statutes intended them, where
applicable, to supplant entirely the tort-based legal system. So, with
some exceptions (willful misconduct, violation of statutes, and the like),15
compensation statutes generally dispense with concepts of legal or moral
fault inherent in tort law.16 The test for providing
statutory compensation “is not the relation of an individual’s
personal quality (fault) to an event.” It is, instead, “the
relationship of an event to an employment.”17
“The essence of applying the test is not a matter of assessing blame,
but of marking out boundaries.”18
Workers’ compensation statutes likewise changed the
basic ground rules for compensation. No recovery would be allowed for
pain and suffering. Nor could a claimant, absent a settlement, recover
a net-present value lump sum award for lost future earning capacity. Loss
of actual wages would be compensated, but only incrementally and at a
level less than the true loss. The lower recovery, the statutory draftsmen
thought, would give employees a direct stake in promoting workplace safety.19
The draftsmen also wanted to make clear that it was “never intended
that compensation payments should equal actual loss, for the reason, if
no other, that such a scale would encourage malingering and trumped-up
claims.”20 The statutory remedy, they asserted,
was meant to “ensure that the claimant continue to receive the bare
minimum income and medical care to keep him from destitution.”21
On the other hand, it would be equally wrong to think
of the workers’ compensation statute as a mere expedient of the social
welfare state, where the government merely redistributes wealth by taxing
some for the benefit of others. Instead, the statutory model assumes that
most employers will purchase private insurance on the open market. Though
the premiums serve as a kind of self-administered, indirect tax, the insurance
market nonetheless adjusts the premium rates in a way that tailors costs
to industrial risks. In doing so, the market provides a rough risk/cost
correspondence — something a crude tax code could never do and, if
it could, not quite so well. Employers ultimately pass the premiums to
the consumers, who pay their share of the liability as a hidden cost-of-goods-sold.22
Unlike a social welfare program where the cost is spread across the entire
public, only the “particular class of consumers” purchasing
the specific product pays for the transferred premium.23
From an economic perspective, the statutory compensation system provides
a form of risk disincentive superior to a welfare entitlement program
but, admittedly, inferior to the direct accountability of a judicially
enforced tort liability system.
If the workers’ compensation statute is not a tort-based
system designed to punish the negligent and to exonerate the careful,
if it is not a social welfare system that taxes the negligent and careful
alike and redistributes the wealth to the employees of both, what then
is it? Most commentators agree it can be best described as a three-party
societal compact — one which, like a treaty, has the force of law.
The compact exists between capital, labor, and government. Seeking a peace
of sorts, each gave up something and got something in return. This “societal
exchange,” the Virginia Supreme Court has observed, underlies the
“quid pro quo” of the statute.24
Industry received immunity from tort suits in exchange
for providing no-fault statutory compensation. Employees got the certitude
of some compensation in most cases of work-place injuries,25
but gave up the lotto-like opportunities of high tort recoveries in cases
of employer fault.26 “From this it follows that
the great secret for success of the workers’ compensation system
lay not in its vaunted, coercive original compulsion, but in the fact
that it followed the very pattern of risk distribution that both historical
experience and general theory of contract law indicated would best minimize
the risks in question.”27
The third and often ignored member of the compact, government, walked away from the bargaining table with a more efficient method of dispute resolution (thereby relieving the mounting pressure on judicial resources), but in the process gave up the ancient ad judicare role of its citizens. In employment injury and death cases, citizens forever lost their right to participate in civil juries—a core aspect of their popular sovereignty—thus forfeiting any continuing opportunity to pass judgment in specific tort cases on the reasonableness of industrial risks associated with the ever-evolving economy. From a historical perspective, this was no small sacrifice. “To many of the Framers’ generation, the jury was the lower judicial bench in a bicameral judiciary and the democratic branch of the judiciary power—more necessary than representatives in the legislature.”28 To them, the jury was “no mere procedural formality, but a fundamental reservation of power in our constitutional structure. Just as suffrage ensures the people’s ultimate control in the legislative and executive branches, jury trial is meant to ensure their control in the judiciary.”29 Having paid such a steep price to ensure its success, government (serving as the negotiating agent of the polity at large) earned a high stake in this societal compact and an enduring expectation that the promises of the compact justify the sacrifice.
II. Judicial Supervision of the Social Compact
The contractual character of the worker compensation legislation—well-recognized
in Virginia law30 —involves a dynamic compact,
one that evolves as economic conditions change. The underlying principles
of the statutory quid pro quo should remain immutable, but their application
will vary when applied to unforeseen circumstances. To ensure this is
done faithfully, the statute appointed representatives of each of the
three parties to the commission tasked with administering the compact.
The 1918 Virginia Workers’ Compensation Act provided, as it still
does today, that only one commissioner shall be classified “as a
representative of employees” while another “shall be classified
as a representative of employers.”31 The third
member, appointed by a joint vote of both houses of the General Assembly,
represents the public interests of the polity at large.32
Like any complex contract, the workers’ compensation
statute assumes unanticipated circumstances may disrupt the consensual
quid pro quo enough to warrant a renegotiation of certain aspects of the
original deal—permitting a change order of sorts to adjust the literal
contractual performance obligations to better match the unwritten assumptions
shared by the contractual parties. The importance of this reexamination
effort should not be overlooked. “If legislatures and courts forget
the historical origins and economic structure of the compensation statutes,
they may bring about an institutional disarray that works against the
interests of both the employer and the employee.”33
It seems a great many change order requests are now on
the negotiating table. Some argue that, given the “present distress
of the system,” perhaps the “levels of benefits and the extent
of coverage have simply become too lavish to satisfy the elaborate set
of constraints upon any compensation system, voluntary or compulsory.”34
Others reach the opposite conclusion, arguing that “increased compensability
standards and other reforms to workers’ compensation systems, which
have diminished the employee end of the quid pro quo, should also correspondingly
increase employer exposure to tort liability.”35
This debate appears to be ongoing in many states.36
Given its unique role, the judiciary should take no sides
in this contest. The primary task of the courts is to provide stable,
predictable precedents—ones so clear and reliable that both the employee
and employer classes can calculate the cost/benefit equation with some
degree of confidence. When that equation unreasonably favors one or the
other party, either would then be able to present his case to the legislature
and seek a remedy for the imbalance. Rebalancing the scales, however,
should be a purely legislative function.
Two reasons lead me to this conclusion. The first is structural.
“Owing to its composition and character, the judiciary is the least
democratic branch of our tripartite government.”37
When it goes beyond its charter, the judiciary “inoculates the political
class from having to deal with the hard realities of governing a diverse,
pluralistic society” and thereby relieves the legislative branch
of government of the “responsibility for articulating public policy
with any degree of specificity. This has the effect of anesthetizing some
citizens and alienating others.”38
The second reason is more practical, for “even if the courts had
plenary authority to make law, they are certainly ill equipped to do it.
Truth be told, the institution of the judiciary is not at all nimble enough
to engage the kind of social experimentation necessary to make good law.
Once a court issues a ruling, the doctrine of stare decisis immediately
encamps around it to stifle any later change or repudiation. That is not
at all the situation with legislation, which can come and go as political
power migrates from one set of interest groups to another. The systemic
capacity for inertia that characterizes the judicial system makes it a
poor laboratory for improvising on social policy.”39
The quality of the judiciary’s work, therefore, should
not be judged on the basis of the sagacity of its broad policy pronouncements.
Nor should the judiciary be graded on its capacity to recalibrate the
specific quid pro quo on a case-by-case basis—driven not by neutral
principles of law, but by the desire to achieve some form of ad hoc fairness
for every litigant in every case.
Instead, on each specific line of judicial precedent, the primary question
is this: Has the judiciary provided the degree of doctrinal clarity necessary
for its precedents to produce predictable results? If so, the parties
to the compact can calculate the cost/benefit equation of any given legal
principle—at least enough so to confirm the principle as consistent
or to condemn it as inconsistent with the parity of interests underlying
the original compact.
In the main, I think the answer is yes. But several stress points remain. Let me mention here just a few.
III. Stress Points in the Application of the Virginia Act
A . Actual, Peculiar and Enhanced Risks: What Are
the Comparators?
At the heart of the Virginia Act is the coverage formula. The test we
use—“arising out of and in the course of employment”—parallels
the language used in most states and in the Longshore and Harbor Workers’
Compensation Act.40 The phrase originated in the British
Compensation Act of 1897.41 As Larson has observed:
“Few groups of statutory words in the history of law have had to
bear the weight of such a mountain of interpretation as has been heaped
upon this slender foundation.”42
Four distinct interpretations of this phrase predominate
in American law: the “peculiar risk,” “increased risk,”
“actual risk,” and “positional risk” tests.43
Under the first interpretation, the peculiar risk doctrine,
“which in the early dawn of American compensation law was actually
the dominant rule, the claimant had to show that the source of the harm
was in its nature peculiar to his occupation.”44
This test focused on the nature and quality of the risk, asking how the
risk differed from the kind of risk everyone else faced. Thus, even if
the work exposed the employee to an “increased quantitative risk
of injury by heat, or cold, or lightning, the claimant might be turned
away with the comment that ‘everyone is subject to the same weather.’”45
The specific degree of risk was of no moment to the peculiar risk doctrine.
The doctrine originated in Massachusetts in the early 1900s. As Larson
points out, however, the peculiar risk theory “gradually achieved
a well-deserved oblivion and was replaced by the increased-risk test.”46
The increased risk test is different “in that the
distinctiveness of the employment risk can be contributed by the increased
quantity of a risk that is qualitatively not peculiar to the employment.”47
So, for example, even though everyone may be subject to the same kind
of weather risks (lightning, hail, rain, etc.), an employee may be still
covered if his work subjected him to a greater degree of risk from dangerous
weather.
In contrast, the actual risk doctrine ignores whether
the risk is either peculiar in quality or enhanced in quantity, so long
as it is in fact a risk of employment. “Under this doctrine, a substantial
number of courts are saying, in effect, ‘We do not care whether this
risk was also common to the public, if in fact it was a risk of this employment.’”48
The most generous of tests, the positional risk model,
goes further still. Coverage under this view applies to any injury during
employment that would not have necessarily happened absent employment.
The only injuries excluded from coverage would be those the employee would
have suffered had he simply stayed home from work that day.49
Where exactly does Virginia stand? The most recent Virginia
Supreme Court case states that we apply the “actual risk” test.50
To prove the point, the case observes that the Court has “repeatedly
quoted with approval the test enunciated in In re Employers’ Liab.
Assur. Corp., 102 N.E. 697 (Mass. 1913),” which held that the “causative
danger must be peculiar to the work and not common to the neighborhood”—a
statement of the peculiar risk test.51 The Virginia
Court of Appeals similarly conjoins the peculiar and actual risk tests
as if they were restatements of each other.52 Earlier
Virginia cases also appear to employ a variant of the increased-risk test.
As one case put it: “Excluded is an injury which comes from a hazard
to which the employee would have been equally exposed apart from the employment.”53
More recent cases also use this formulation.54
Perhaps the best examples of how these seemingly semantic
distinctions make a big difference are the lightning cases. Consider an
employee, while on the job, getting struck by lightning. Nothing particularly
peculiar about that. Lightning strikes happen to workers and non-workers
alike. Using its conventional formulation, the peculiar risk doctrine
would probably deny coverage.55 The increased-risk
doctrine would question whether the employee’s quantitative risk
of being struck had been enhanced by his employment. Was he repairing
a radio tower during a storm? If so, he would be covered. If, on the other
hand, no condition of employment heightened the risk of being struck,
coverage would probably be denied. Under the actual risk doctrine (as
it has been conventionally understood), the only issue would be whether
the employment actually exposed the employee to the risk. So if the employee
had to walk a block down the street during a thunderstorm to perform some
work task, the lightning strike during the walk would qualify as an actual
risk of employment. Under the positional risk model, any random lightning
strike would be covered if it occurred while on the job.
The only safe synthesis of Virginia cases is a fairly modest one: Virginia does not apply the positional risk test, despite our ostensible fidelity to Indiana law.56 Instead, we appear to apply variants of the remaining three tests (peculiar, increased, and actual risk doctrines) on an ad hoc basis, subordinating conceptual subtleties to unique facts of each case. Of these three, most fact patterns in the decision law suggest that the increased-risk test takes the laboring oar in Virginia law.
B. Compensable Consequences
From time to time, common law tort concepts get smuggled into the statutory
compensation framework. That is particularly true with causation principles.57
As originally understood, compensation depended not on whether a workplace
event proximately caused an injury. The threshold issue was simply “the
relationship of an event to an employment.”58
Causation played a role, but it was limited to medical, not legal, causation.59
If the original injury (from a medical point of view) caused a later consequent
injury, which itself caused an injury, and so on, then all medically caused
consequential injuries would be covered. Under this approach, only intervening
causes outside the chain of medical causation would disrupt causality.
Even so, courts began to insert attenuation limits into this pure medical causation principle. The compensable consequences doctrine restates the general rule: Compensation should be allowed for every injury stemming, as a natural consequence, from the original injury.60 Thus, if A causes B, B causes C, and C causes D, then it can be reliably said that A causes D — both as a matter of syllogistic logic and medical science. Nevertheless, at some point, courts refuse to recognize these sequential causes and require a direct showing of causation between the original injury and the consequent injury.61 Without saying as much, these courts appear to be using proximate cause principles to break the otherwise limitless but-for causal chain. Whether such a tort-based attenuation principle should be imported into workers’ compensation law remains an open question, but there can be little doubt that variations of it already have been.
C. Intentional Torts: Resurrection of the ‘Fellow
Servant’ Wicked Sister
Virginia courts have long held that, under some circumstances, the compensation
statute may apply to intentional torts committed by employers or fellow
employees.62 Two boundary lines have been marked off
on this topic. The first focuses on whether the tortious conduct against
the employee was “personal to the employee and not directed against
him as an employee or because of his employment.”63
If personal to the claimant, “the injury does not arise out of the
employment.”64 The second boundary line excludes
coverage where the intentional tort causes a gradual injury.65
A gradual pattern of harassment by co-employees or an employer, under
this approach, would not cause a covered injury.66
Neither boundary line, however, can be easily seen in the dense underbrush
of most litigable fact patterns.67
Applying the compensation statute to intentional torts
resurrects one of the three wicked sisters in a new, but equally potent,
way. The fellow servant doctrine no longer exists under modern law. And
even when the doctrine applied, it had no effect on a suit against the
co-employee personally. Thus, an employee with a viable common law claim
against an employer may rely on fellow-servant negligence to trigger respondeat
superior liability and also sue the co-employee. In contrast, where the
compensation statute applies, it immunizes co-employees from any tort
liability just as it does employers.68 The fellow-servant
doctrine thus reappears as the co-employee immunity bar. To some, this
wicked sister throws off the balance of equities inherent in the original
social compact—making the modern bargain far too pricey for the employee.69
Covering intentional torts under the compensation statute also raises
two other problems.
First, the original quid pro quo balanced the certainty of nominal statutory
benefits based on strict liability principles against the uncertainty
of a tort recovery based on negligence principles. This made sense because
proving negligence in court was often problematic and almost always laborious.
In contrast, a claimant need not litigate vague notions of reasonable
care to assert an intentional tort. Proof of the tortious conduct and
damages is enough.
Second, the concept of moral “just deserts” plays a limited
role in the original quid pro quo. Deterring employers from either creating
or acquiescing in unsafe working conditions, it was thought, could be
best accomplished on an indirect and broad basis through the incremental
cost of insurance. The societal interest in voicing moral outrage at intentional
tortfeasing by employers, however, demands a more direct and specific
application. The availability of punitive damages in tort law,70
coupled with the unavailability of contributory negligence bars or comparative
negligence discounts, enforces this public interest.
D. Standard of Review: When the Court of Appeals
Reviews the Commission
Virginia Code § 65.2-706(A) requires Virginia courts to accept an
award of the commission as “conclusive and binding as to all questions
of fact.” This deference is not a “mere legal custom, subject
to a flexible application, but a statutory command.”71
Factual findings become questions of law (subject to de novo appellate
review) only when the factfinder abuses its role by acting irrationally.
When appellate judges say they will not overturn a factual finding if
“any credible evidence” supports it,72 they
do not mean to imply that they personally have weighed the testimony and
found this or that bit of evidence credible.73
They are simply passing on whether a rational factfinder could find it
sufficiently credible to satisfy the burden of persuasion.74
Given this standard of review, only the rarest of cases can push far enough
beyond the bell-shaped curve of rationality to justify an appellate reversal
of commission factfinding.75
On questions of statutory law, it is often said the commission’s
“construction of the Act is entitled to great weight on appeal.”76
No matter how great it is, however, the commission’s legal reasoning
does not receive binding deference on appeal. This caveat, which all but
subsumes the basic rule, parallels the maxim that “pure statutory
interpretation is the prerogative of the judiciary.”77
The commission’s interpretations of its own rules, on the other hand,
receive far greater respect on appeal.78 But even this
deference dissipates — disappearing altogether, I think — if
the commission employs inconsistent interpretations of the same rule in
different cases.79
E. Standard of Review: When the Commission Reviews
its Deputies
As far as I can tell, there appears to be no consistently applied neutral
principle of law governing the commission’s review of its deputies’
factfinding. When the commission affirms the deputy, it often begins the
analysis with the proposition that the full commission defers to a deputy’s
factual findings based upon credibility assessments.80
When the commission reverses on the facts, it either makes no mention
of the deference principle or admittedly refuses to follow it.81
The inconsistency stems from the statutory anomaly of treating the commission
simultaneously as an appellate body and a factfinding tribunal.
Bound by the “conclusive and binding” nature of the commission’s factfinding, Virginia Code § 65.2-706(A), the Virginia Court of Appeals has not sought to impose a uniform standard for intra-commission review of factfinding, except simply to say the commission should not “arbitrarily” disregard its deputies who hear ore tenus testimonial evidence.82
F. Equity & Imposition
In the Anglo-American tradition, the equity powers of a chancellor acted
as a check against the “universality of the common law precedents
and their unbending quality” which the chancellor occasionally found
“unjust when applied to a specific set of circumstances.”83
“In ‘these and like cases,’ St. Thomas Aquinas counseled,
‘it is bad to follow the law, and it is good to set aside the letter
of the law and to follow the dictates of justice and the common good.’”84
In Virginia, the doctrine of imposition imported these flexible equitable
principles into the commission’s decisionmaking power.85
As a general rule, the doctrine applies “in cases where the evidence
shows the occurrence of some mistake or unfair conduct that would render
a strict application of the Act unjust in a particular case.”86
Given its open-ended appeal to “full and complete justice in each
case,”87 however, the doctrine of imposition seems
to turn up when and where it chooses.
In one case, an employer stopped paying wage benefits to an employee who had gone back to work.88 The employer, however, did so without first filing an application to terminate. The doctrine of imposition intervened and relieved the employer of the consequences of its mistake. The “purpose of the Act,” the court stated, “is to compensate injured workers for lost wages, not to enrich them unjustly.”89 This unjust-enrichment theme, however, proved to be short lived. Two later cases found it inadequate, as a freestanding principle, to preclude an employee from obtaining a double recovery as a result of similar technical defaults by employers.90 These two cases weakened the unjust-enrichment principle enough that it could not excuse an employer’s technical violation of a commission rule, even though a strict application of the rule resulted in the payment of compensation payments to an employee during his period of incarceration.91
G. The “Jurisdictional” Two-Year Statute
of Limitations
Virginia law has long viewed the statute of limitations for filing a workers’
compensation claim as “jurisdictional.”92
In this context, the term describes the kind of jurisdiction that (unlike
other varieties) “cannot be conferred on the Commission by consent.”93
Most forms of non-subject matter jurisdiction—like, for example,
personal and notice jurisdiction—can be both conferred and waived
by consent. Following that logic, unpublished opinions of the Virginia
Court of Appeals and the commission have held that the statute of limitations
for filing claims implicates “subject matter jurisdiction.”94
Non-compliance with a jurisdictional statute of this kind deprives the
tribunal of power to hear the case,95 thereby annulling
equitable doctrines like res judicata and other means of collaterally
attacking an ultra vires decision.96
Despite this, the operation of other equitable doctrines—estoppel, waiver, and imposition—may arguably preclude an employer from asserting the statute of limitations as a defense.97 Not yet explained, however, is how subject matter jurisdiction can be conferred by such de facto consent grounds.98 Nor has any explanation been given for recognizing the availability of some equitable doctrines (like estoppel), but not others (like res judicata). For these reasons, one commissioner has criticized the characterization of the limitations statute as a measure of the commission’s subject matter jurisdiction.99
H. Liberal Construction of the Act
Liberal construction operates to expand the Workers’ Compensation
Act to embrace cases within its coverage that would otherwise be on the
fence.100 The liberality principle, however, does
not authorize an “unusual or tortured” interpretation.101
Virginia has frequently applied the liberality principle, albeit subject
to various caveats.102
The concept of liberal construction, however, appears to be only one-dimensional. When the statute applies to an injury solely due to a liberal construction (that is, in cases where an illiberal construction could exclude coverage), two consequences occur: Benefits are awarded to the employee, and tort immunity is awarded to the employer.103 But when an employer files a plea of immunity in circuit court asserting the applicability of the statute to the employee’s injury (thus entitling the employee to statutory benefits and the employer to statutory immunity), the courts do not typically begin their legal analysis with the observation that the statute will be liberally construed to apply to the injury. The liberality principle, therefore, is a fickle doctrine that depends entirely on the employee’s election of remedies.104
IV. The Quest for Predictability and Efficiency
The original architects of the workers’ compensation system complained
in the early 1900s about the “waste and uncertainty of the present
state of the law” and saw it as “essential that the act should
be so drawn as to be as far as possible automatically applicable to any
given state of fact, and, as far as may be, to prevent the right to compensation
from becoming a subject of antagonistic litigation.”105
The idealistic hopes of these early reformers were high indeed:
This [statutory] language has been adopted upon the assumption that it has acquired by judicial construction, during the years which have elapsed since these acts were passed, so fixed and certain a meaning that a resort to the English decisions will, in a great majority of cases, render further interpretation and construction unnecessary and so avoid that vast amount of litigation generally required for this purpose.106
Needless to say, that assumption (expressed as early as
1911) proved to be overly optimistic. Judicial opinions from a year ago
sometimes confound me every bit as much as House of Lords decisions from
the last century.
I concede that highly predictable judicial precedent may
also appear to some to be highly erroneous as well, making its clarity
all the more repugnant to those that think so. But as Justice Scalia has
said, “in simpler times uncertainty has been regarded as incompatible
with the Rule of Law.”107 It necessarily, albeit
reluctantly, follows that there are “times when even a bad rule is
better than no rule at all.”108
Even so, each descending step from juristic virtue to vice—prospering with a good rule, suffering under a bad rule, barely surviving with no rule at all—exacts a high human and economic toll. In Virginia, the workers’ compensation statute covers more than three million workers and embraces over 90% of the statewide workforce.109 Last year alone, 157,607 accidents were reported to the Virginia Workers’ Compensation Commission.110 Nationwide, the cost to employers of maintaining the system exceeds $80 billion dollars annually.111 Its magnitude alone warrants the observation, made by the Virginia Supreme Court in 1946, that the workers’ compensation statute “comprises one of the most important branches of law” and is as “essential to industry as it is to labor.”112 “Upon its effectiveness depends the potential welfare of a large number of employees and their families.”113 Preserving and, perhaps, even enhancing that effectiveness would be a fair tribute to Governor Stuart’s noble “spirit of human brotherhood.”114
NOTES
*The views advanced in this outline represent commentary "concerning
the law, the legal system, [and] the administration of justice" as
authorized by Virginia Canon of Judicial Conduct 4(B) (permitting judges
to "speak, write, lecture, teach" and otherwise participate
in extra-judicial efforts to improve the legal system). These remarks,
therefore, should not be mistaken for any official view of the Court of
Appeals or my opinion as an appellate judge in the context of any specific
case.
1. See Fields v. Virginian Ry. Co., 114 Va. 558, 561,
77 S.E. 501, 502 (1913) (“It is the duty of the master to use ordinary
care and diligence to provide a reasonably safe place in which his servant
is to work . . . .”); 2 Dan B. Dobbs, The Law
of Torts § 392 (2001).
2. See W. Page Keeton, et al., Prosser and eeton on The
Law of Torts § 80, at 568 (5th ed. 1984); Lawrence M. Friedman &
Jack Ladinsky, Social Change & the Law of Industrial Accidents, 67
Colum. L. Rev. 50, 52-53 (1967). An early advocate of worker compensation
statutes, Arthur Larson, cited a 1907 German study to illustrate how the
law provided no recovery in the great majority of industrial accidents:
Classification of Causes of Accidents:
1. Negligence or fault of employer: 16.81%
2. Joint negligence of employer and injured employee: 4.66%
3. Negligence of fellow servant: 5.28
4. Acts of God: 2.31%
5. Fault or negligence of injured employee: 28.89
6. Inevitable accidents connected with the employment: 42.05
Only category number 1, “negligence or fault of employer,” would
provide a legal basis for employees to receive compensation for an injury
suffered in the common law workplace. Arthur Larson, The Nature &
Origins of Workmen’s Compensation, 37 Cornell L.Q. 206, 224 (1951-52).
But even then, Larson points out, “the defense of assumption of risk
might still apply.” Id. at 225. American statistics showed a similar
rate of uncompensated work-place injuries. Keeton, et al., supra note
2, § 80 at 572 n. 43.
3. Keeton, et al., supra note 2, § 80 at 573.
Later common law courts injected the “vice principal” doctrine
(excluding from the fellow-servant category all employees in supervisory
positions) to mitigate against the effect of the fellow servant rule.
See Richard A. Epstein, The Historical Origins and Economic Structure
of Workers’ Compensation Law, 16 Ga. L. Rev. 775, 778 n.10 (1982);
Larson, supra note 2, at 225-26.
4. See Keeton, et al., supra note 2, § 80 at
568 (“The background of these statutes lay in the very limited tort
liability of the master to his servant at common law. The extent of the
employer’s responsibility, although it was said to rest upon the
understanding of the parties, undoubtedly was fixed by the courts upon
the basis of old industrial conditions, and a social philosophy and an
attitude toward labor, which are long since outmoded.”).
5. See Larson, supra note 2, at 230-32; Lawrence J. Pascal,
Virginia Workers’ Compensation: Law & Practice, at 1-1 (3d ed.
2000) (“Historically, the origin of the modern workers’ compensation
system can be traced to Germany. In 1884, Germany enacted the first modern
compensation system. Both philosophers and politicians played a role in
the birth of the compensation idea. Frederick the Great believed it was
the duty of the state to provide for those who could not provide for themselves.
The philosopher Johann Fichte advanced this idea by expounding the view
that ‘the misfortunes, disabilities and accidents are ultimately
social and not individual in origin.’...A significant feature of
the German workers’ compensation system was that the employee had
to contribute to the cost of the insurance coverage.”) (footnote
omitted).
6. See Pascal, supra note 5, at 1-1, 1-2. The 1897 act
removed negligence “as a condition of liability,” but retained
“the common law of tort against the employer” for cases in which
“the negligence or wilful act of the employer” caused the injury.
Epstein, supra note 3, at 797-98(analyzing the Workmen’s Compensation
Act of 1897, 60 & 61 Vict., ch. 37 § 1(2)(b)).
7. Epstein, supra note 3, at 787. Britain’s system
displaced the common law rules of liability, stating that employees “‘shall
have the same right of compensation and remedies against the employer
as if the workman had not been a workman of nor in the service of the
employer, nor engaged in his work.’” Id. at 788 (quoting English
Employers’ Liability Act of 1880, 43 & 44 Vict., ch. 42 §
1). Though relieving employees of the burden of employer defenses, the
act retained the element of fault, thereby allowing recovery only where
the employer acted negligently.
8. See Pascal, supra note 5, at 1-2 (“In America,
the compensation principle underwent widespread study and exhaustive investigation.
The first compensation act in the United States was a modest cooperative
accident fund for miners which passed in Maryland in 1902. In 1908, Massachusetts
passed a law which permitted employers and employees to voluntarily agree
to compensation arrangements. Maryland passed a similar statute in 1910.
Both state laws were doomed from the outset because of apathy on the part
of employers and employees. However, the idea of a no-fault system of
compensation designed to serve the public good, avoid lengthy litigation
and protect the interest of employees and employers had taken root.”).
9. See N.Y. Cent. R.R. v. White, 243 U.S. 188, 197 (1917)
(holding New York’s act constitutional, the Supreme Court declared,
“In support of the legislation, it is said that the whole common-law
doctrine of employer’s liability for negligence, with its defenses
of contributory negligence, fellow-servant’s negligence, and assumption
of risk, is based upon fictions, and is inapplicable to modern conditions
of employment; that in the highly organized and hazardous industries of
the present day the causes of accident are often so obscure and complex
that in a material proportion of cases it is impossible by any method
correctly to ascertain the facts necessary to form an accurate judgment,
and in a still larger proportion the expense and delay required for such
ascertainment amount in effect to a defeat of justice; that under the
present system the injured workman is left to bear the greater part of
industrial accident loss, which because of his limited income he is unable
to sustain, so that he and those dependent upon him are overcome by poverty
and frequently become a burden upon public or private charity; and that
litigation is unduly costly and tedious, encouraging corrupt practices
and arousing antagonisms between employers and employees.”).
10. Larson, supra note 2, at 233.
11. Id. at 206.
12. Parke P. Deans, Workmen’s Compensation in Virginia
4 (1938) (quoting Governor Stuart’s address on February 2, 1914).
13. Richmond Cedar Works v. Harper, 129 Va. 481, 488,
106 S.E. 516, 519 (1921) (“The Virginia act has features which are
common to nearly if not quite all such laws, and has for its humane purpose
the providing for all workmen coming within its provisions who are injured
during the course of their employment of compensation therefor which is
certain in amount without deduction.”).
14. Humphrees v. Boxley Bros. Co., 146 Va. 91, 96, 135
S.E. 890, 891 (1926) (quoting Stertz v. Indus. Ins. Comm’n, 91 Wash.
588, 590, 91, 158 P. 256, 258 (1916)) (emphasis added).
15. This too had its antecedents in English and German
law. “The English Act of 1897 provided that no compensation should
be allowed if the injury to the workman was attributable to willful and
serious misconduct, and under the German law the workman is still barred
by his own gross carelessness.” Francis H. Bohlen, A Problem in the
Drafting of Workmen’s Compensation Acts, 25 Harv. L. Rev. 328, 334
(1911-12); see also Va. Code Ann. § 65.2-306(A) (2005) (“No
compensation shall be awarded to the employee or his dependents for an
injury or death caused by... [t]he employee’s willful misconduct
or intentional self-inflicted injury....”).
16. See Keeton, et al., supra note 2, § 80
at 573 (“The employer is charged with the injuries arising out of
his business, without regard to any question of his negligence, or that
of the injured employee. He is liable for injuries caused by pure unavoidable
accident, or by the negligence of the worker.”); Larson, supra note
2, at 208 (“Let the employer’s conduct be flawless in its perfection,
and let the employee’s be abysmal in its clumsiness, rashness and
ineptitude: if the accident arises out of and in the course of the employment,
the employee receives the award. Reverse the positions, with a careless
and stupid employer and a wholly innocent employee: the same award issues.”).
Workers’ compensation systems, Larson argued, differed from a tort
regime because of its “social philosophy, its relation of awards
to disability rather than loss, and its distribution of the cost to the
consumer.” Id. at 216.
17. Larson, supra note 2, at 208.
18. Id.
19. See Fauver v. Bell, 192 Va. 518, 523, 65 S.E.2d
575, 578 (1951) (“Workmen’s compensation acts bring the employee’s
recovery against the employer to a lower level of compensation than that
of damages recoverable at common law. The divergence arises from the different
purposes of the two recoveries.”). The minimal nature of awards serves
three purposes: (i) to “keep down the overall costs of the plan,
which will induce employers to continue to hire labor,” (ii) to “prevent
fraud against the plan, as there is less to gain by pretending that an
injury, or its consequences, is work-related,” and (iii) to “create
additional incentives upon the worker for self-protection and therefore
act as an implicit substitute for assumption of risk and contributory
negligence.” Epstein, supra note 3, at 800-01.
20. Larson, supra note 2, at 214.
21. Id. at 210. Allowing full recovery and restoration
for workplace injuries, Larson cautioned, would “encourage malingering
and trumped-up claims.” Id. at 214. It is for this reason that “the
amount of compensation awarded may be expected to go not much higher than
is necessary to keep the worker from destitution.” Id. at 213. Professor
Epstein echoed this sentiment: “In exchange for the broad coverage
formula, the workman received a level of compensation that, by design,
left him worse off than if the injury itself had never taken place.”
Epstein, supra note 3, at 800 (emphasis in original). And by not bestowing
“ownership” of the award on the recipient, the workers’
compensation system “goes no further in nature, amount or duration
than the necessities of that protection require.” Larson, supra note
2, at 214.
22. See Larson, supra note 2, at 217 (“The real
clue to the character of each system is the source of financing: in the
American it is typically premiums paid by the employer and passed on to
a particular consuming group.”).
23. Id. at 218 (observing that this framework “retains
a relation between the hazardousness of particular industries and the
cost of the system to that industry and consumers of its product”).
24. Roller v. Basic Constr. Co., 238 Va. 321, 327, 382
S.E.2d 323, 325 (1989) (“As frequently stated, the Workers’
Compensation Act (the Act) is based upon a quid pro quo, a societal exchange
wherein employees are provided a purely statutory form of compensation
for industrial injuries.”).
25. See N.Y. Cent. R.R., 243 U.S. at 201 (“If the
employee is no longer able to recover as much as before in case of being
injured through the employer’s negligence, he is entitled to moderate
compensation in all cases of injury, and has a certain and speedy remedy
without the difficulty and expense of establishing negligence or proving
the amount of the damages.”).
26. See Potomac Elec. Power Co. v. Dir., 449 U.S. 268,
282 n.24 (1980) (“Workmen’s compensation acts are in the nature
of a compromise or quid pro quo between employer and employee.... Employees,
on the other hand, ordinarily give up the right of suit for damages for
personal injuries against employers in return for the certainty of compensation
payments as recompense for those injuries.” (quoting 1 M. Norris,
The Law of Maritime Personal Injuries § 55, at 102 (3d ed. 1975)));
N.Y. Cent. R.R., 243 U.S. at 204 (“Nor can it be deemed arbitrary
and unreasonable, from the standpoint of the employee’s interest,
to supplant a system under which he assumed the entire risk of injury
in ordinary cases, and in others had a right to recover an amount more
or less speculative upon proving facts of negligence that often were difficult
to prove, and substitute a system under which in all ordinary cases of
accidental injury he is sure of a definite and easily ascertained compensation,
not being obliged to assume the entire loss in any case but in all cases
assuming any loss beyond the prescribed scale.”); see also Jason
M. Solomon, Fulfilling The Bargain: How The Science Of Ergonomics Can
Inform The Laws Of Workers’ Compensation, 101 Colum. L. Rev. 1140,
1145-46 (2001) (“The workers’ compensation ‘bargain’
between employers and employees was intended to be simple: In exchange
for immunity from tort actions, employers would provide employees with
swift, though limited, compensation.... This balancing embraced the original
bargain.”); Eston W. Orr Jr., Note, The Bargain is No Longer Equal:
State Legislative Efforts To Reduce Workers’ Compensation Costs Have
Impermissibly Shifted The Balance Of The Quid Pro Quo In Favor Of Employers,
37 Ga. L. Rev. 325, 326 (2002) (recognizing that the “quid pro quo,
known as the ‘workers’ compensation bargain,’” formed
a “statutory compromise between employer and employee” that
became “the cornerstone of the entire workers’ compensation
framework”); Theodore F. Haas, On Reintegrating Workers’ Compensation
and Employers’ Liability, 21 Ga. L. Rev. 843, 858 (1987) (“Employers
give up the limited scope of tort liability in return for the limited
amount of liability under workers’ compensation. Employees give up
the possibility of the greater recovery under tort law in return for a
speedy and certain payment that fully covers their medical expenses and
partially replaces their lost wages.”).
27. Epstein, supra note 3, at 805.
28. D. Arthur Kelsey, The Architecture of Judicial Power:
Appellate Review & Stare Decisis, 53 Va. Lawyer, No. 3, at 13, 14-15
(Oct. 2004) (citations omitted), available at http://www.vsb.org/publications/valawyer/oct04/index.html.
29. Id.
30. See Roller, 238 Va. at 327, 382 S.E.2d at 325-26
(“As frequently stated, the Workers’ Compensation Act (the Act)
is based upon a quid pro quo, a societal exchange wherein employees are
provided a purely statutory form of compensation for industrial injuries.”);
Fauver, 192 Va. at 522, 65 S.E.2d at 577 (“Rights granted and obligations
imposed are limited as granted or imposed by the Act and are in their
nature contractual.”); Humphrees, 146 Va. at 95, 135 S.E. at 891
(“It is said to be in the nature of a compromise between employer
and employee to settle their differences arising out of personal injuries,
but it is a compromise greatly to the advantage of the employee.”);
see also Pascal, supra note 5, at 2-28, 2-29 (“The law, in effect,
represents a compromise.”).
31. Va. Code Ann. § 65.2-200(D) (2005).
32. Va. Code Ann. § 65.2-200(B) (2005).
33. Epstein, supra note 3, at 819.
34. Id. at 809.
35. Orr, supra note 26, at 332.
36. See, e.g., Editorial, Workers’ Comp System
is Broke, So Fix It, Dallas Morning News, June 1, 2004, at 10A (citing
an advisory commission’s “staff report on the Texas Workers’
Compensation Commission” that “offers some useful ideas for
overhauling a system that fails workers and employers”); Opinion,
Haste Makes . . . Legislature Rushing a Workers’ Comp Fix, San Diego
Union-Tribune, April 16, 2004, at B-8 (noting that the California “Legislature
is poised to approve a workers’ compensation proposal aimed at wringing
waste out of the $29 billion system”); Jerome R. Stockfisch, Year-Old
Workers’ Comp Law Leaves Mark, Tampa Tribune, April 13, 2004, at
1 (“Lawmakers tackled workers’ compensation last year after
employers, doctors, lawyers and workers convinced them that the state
was in crisis. A 2001 survey showed Florida with the second-highest workers’
compensation premiums in the country. Yet benefits to injured workers
were among the lowest.”); Tom Abate, Workers’ Compensation Crisis;
System Seen as Ripe for Overhaul; Lawmakers Tackle Reforms; Ballot Measure
Threatened, S. F. Chron., March 29, 2004, at A1 (noting that “California
employers say they’re being crushed by the nation’s highest
insurance premiums and want reforms to curb soaring medical and disability
costs”); Peter Nicholas, et al., Governor Turns His Attention to
Troubled Workers’ Comp; Schwarzenegger, Fresh from Victory on Two
Propositions, Readies for His Next Challenge, L.A. Times, March 4, 2004,
at B-1 (noting that the California workers’ comp system “is
widely blamed for chasing business to states where insurance costs are
stable”); Bob Gary Jr., Georgia, Tennessee Businesses Crave Insurance
Reform, Chattanooga Times Free Press, Jan. 18, 2004, at G1 (quoting “state
Chamber of Commerce head Deb Woolley” who observed that “overhauling
workers’ compensation is ‘an absolute must,’ because it
“‘gives (judges) a lot of latitude to impose their will,’”
and is “‘not fair to employees because it’s not consistent
and employers are getting astronomical costs’”); Charles Stein,
Hoping for Mine Gold from the Golden State Romney, Other Governors See
Chance to Woo Firms Away, Boston Globe, Nov. 20, 2003, at C-1 (writing
that Massachusetts hopes to lure businesses from California where “workers’
compensation costs . . . have almost tripled in four years”).
37. D. Arthur Kelsey, supra note 28, at 17 (citations
omitted).
38. D. Arthur Kelsey, Law & Politics: The Imperative
of Judicial Self-Restraint, 28 VBA News Journal No. 6, at 8 (Sept. 2002),
available at www.vba.org/sept02.htm.
39. Id.
40. 1 Arthur Larson & Lex K. Larson, Larson’s
Workers’ Compensation Law § 3.01, at 3-2 (2003).
41. Id.
