High court's ruling usurps legislature's authority.
In 2003 the Legislature passed the Civil Justice Reform Act, a reasonable attempt to curb excessive punitive damage awards and to level the field between plaintiffs and defendants. It limited punitive damages to $250,000 or three times the compensatory damages but no more than $1 million.
In 2009 the Arkansas Supreme Court held provisions in the act to be unconstitutional, ruling that under Amendment 80 to the Arkansas Constitution procedural rules are within the purview of the court and not the Legislature. According to the court, the Legislature is limited to substantive changes in law.
The ruling was widely criticized as an attempt by the court to regulate policy decisions that should be left to the Legislature. In its ruling, the court had to explain how lawsuit reform is not substantive but merely procedural, obviously a judicial stretch.
The case decided on Dec. 8 arose from a suit by Arkansas rice farmers who received genetically altered seeds. They claimed that the provider of the seeds should have known a majority of Arkansas rice is exported and many countries will not import genetically altered rice.
A jury awarded the farmers almost $6 million in actual damages and $42 million in punitive damages, despite a finding that there was no intentionally harmful conduct on the part of the supplier of the seeds.
The state Supreme Court held that limits on punitive damages violated Article 5, Section 32 of the Arkansas Constitution, which says "no act of the General Assembly shall limit the amount to be recovered for injuries ... to persons or property."
The court's ruling is incompatible with previous decisions in which it restricted the General Assembly's power to limit damages for "physical injuries to property," in other words, for compensation for actual damages to property. But punitive damages are not compensation; they are penalties for grossly negligent conduct. The Constitution's prohibition against limiting recovery for actual injuries does not apply to punitive damages.
The Supreme Court clearly has an anti-lawsuit reform policy agenda. The court ignored its own precedent that presumes acts of the Legislature to be constitutional and that "before an act will be held unconstitutional, the incompatibility between it and the constitution must be clear."
It is unclear how limits on punitive damage are not substantive. It is anything but clear how punitive damages are now compensatory for injuries, as this ruling asserts.
The court is attempting to become a policymaking body that can ignore the will of the people, the separation of powers doctrine and the constitutional role of the Arkansas Legislature. The Supreme Court overstepped its authority and has assumed the role of chief policymaker in Arkansas.
The court's position will cost the state new business, which locates where costs are reasonable and risks are manageable. By undermining lawsuit reform and the will of the people through their Legislature, the court has hurt the state's ability to attract industry and jobs.
Arkansas has two choices for lawsuit reform. The first is to change the Constitution to specifically state that Article 5, Section 32 does not include punitive damages and to remove the procedural power given to the judiciary in Amendment 80. The second choice is to elect justices to the Arkansas Supreme Court who believe in the separation of powers doctrine and who realize their role is not to legislate.
Judicial activism, often seen as relating to national issues, has no place in Arkansas. It hurts the economy and is a job killer.
State Sen. Gilbert Baker, R-Conway, can be reached at Gilbert.Baker@Senate.Ar.gov or at (501) 327-8653.
Guest Commentary Gilbert Baker Gilbert.Baker@Senate.Ar.gov
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|Title Annotation:||Guest Commentary|
|Comment:||High court's ruling usurps legislature's authority.(Guest Commentary)|
|Date:||Dec 19, 2011|
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