Masonry Magazine October 1986 Page. 43
Product Liability Legislation
A defense and no liability would attach where there is an unreasonable or unforeseeable use or alteration of the product. Furthermore, a manufacturer's potential liability for defective products extends only to the "state of the art" technology known at the time the product was manufactured.
The bill adopts the collateral source rule, which permits a judgment to be reduced to reflect compensation from sources other than the defendant so that there will be no double recovery. This legislation also takes direct aim at excessive transaction costs of the tort system, allowing a greater percentage of the tort judgment to flow to the victim.
Presently, almost two-thirds of every dollar paid out through the system goes to attorney's fees or litigation expenses. Attorneys' contingency fees would decrease somewhat as awards increase. The schedule will allow a 25% attorney fee for the first $100,000, 20% for the next $100,000, 15% for the next $100,000, and 10% for the remainder.
Under the measure, non-economic damages such as pain and suffering and mental anguish, as well as punitive damages, are limited to no more than $100,000. This limitation, however, does not apply to economic damages such as medical care, rehabilitation costs, and lost earnings. Awards for such future economic damages as lost earnings or medical care which are greater than $100,000 will be paid periodically rather than in a single lump-sum payment. The courts will have discretion to fix the level and schedule of payments at the time of judgment. Defendants, in certain circumstances, may be required to purchase an annuity to guarantee payments to the plaintiff.
Award ceilings proposed. The $100,000 limitation on damages for pain and suffering, and mental anguish, has already come in for considerable criticism. Frankly, this aspect of the bill does give me some pause-based upon a concern that an arbitrary ceiling could work a serious unfairness in individual cases. It would mean, for example, that a 17-year-old girl who contracted cancer and had to undergo a total hysterectomy because her mother took the cancer-causing drug DES could recover no more than $100,000 for her inability to have children or have normal sexual relations. Such a result in that type of case, simply would be unfair.
To me, this new product liability proposal goes to the real core of the problem by greatly limiting the strict liability doctrine and by doing away with joint and several liability.
Setting too low a ceiling on noneconomic damages could prompt opposition to the bill as a whole, and allow critics of any reform to cite this aspect as a sign of heartlessness and callousness on the part of proponents. The deletion or modification of this single provision would enhance prospects for passage, without undermining the very substantial reforms this legislation would otherwise put in place.
Prospects for Congressional action have been greatly enhanced now that the White House has become an "active player." I look for action first in Senator Kasten's Consumer Subcommittee. Should the Senate take positive action in this session, grass roots efforts by business groups could force a recalcitrant House to act. Unfortunately, to date, the trial lawyers' arguments have quietly persuaded many House members to sit back. But the insurance crisis has penetrated the national consciousness to a point where this finally could be the year we see a Federal product liability law. As pro football coach George Allen once proclaimed for his team "the future is now." The "future" for product liability legislation appears to be "now" as well!
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MASONRY-SEPTEMBER/OCTOBER, 1986 41