Georgia Supreme Court Strikes Down Asbestos Litigation Reform

The Supreme Court of Georgia, in DaimlerChrysler Corp. et al v. Ferrante et al,¹ unanimously struck down recently enacted asbestos litigation reform.² The court affirmed two trial court rulings that held the new asbestos litigation reform unconstitutional as applied to the appellees claims. 

With the goal of requiring a greater level of causation for asbestos related tort claims, the 2005 Georgia General Assembly enacted House Bill 416 (the “Act”), legislation which required among other things that a plaintiff show that asbestos was a “substantial contributing factor” to the exposed person’s medical condition.³ The Act essentially increased the evidentiary requirements for maintaining an asbestos-related claim under Georgia law, requiring a stronger connection between the exposure to asbestos and the alleged injury. The Act required that the increased evidentiary requirements be applied to asbestos claims pending in Georgia on April 12, 2005. 

The Supreme Court of Georgia accepted the appellees' argument that this newly enacted legislation made changes to asbestos-related claims that affected “substantive rights” and therefore could not be applied retroactively to the appellees’ cases. The court also rejected the appellants’ argument that, at the very least, the court should sever the unconstitutional language from the Act and allow the remaining provisions to govern appellees’ and future asbestos claims. 

Statutory Scheme

As alluded to above, the 2005 Georgia General Assembly passed an asbestos litigation reform bill (“Act”) based at least in part on significant concerns that plaintiffs who had no physical manifestation of an asbestos-related injury were filing claims solely on having been exposed to asbestos.⁴ The Act implemented a specific, comprehensive scheme for asbestos-related claims. Among other changes, the Act added very specific evidentiary requirements for maintaining an asbestos-related claim. 

For example, O.C.G.A. § 51-14-3 provided that prima facie evidence of physical impairment of the exposed person as defined in paragraph (15) O.C.G.A § 51-14-2 shall be an essential element of an asbestos claim, and that no person shall bring or maintain a civil action alleging an asbestos claim in the absence of prima facie evidence of physical impairment resulting from a medical condition for which exposure to asbestos was a “substantial contributing factor.” Any person bringing an asbestos claim would be required to file certain specific forms and information from verified sources to substantiate their claim that exposure to asbestos was a “substantial contributing factor to the person’s medical condition.⁵

In an effort to leave open the option of filing an asbestos claim in the future if exposure to asbestos manifests into an injury, the General Assembly clarified that the limitations period on an any asbestos claim not barred as of April 12, 2005 would not begin to run until the exposed person discovers, or “through the exercise of reasonable diligence should have discovered” that he or she was physically impaired as defined above.⁶

As discussed in more depth below, at the heart of the Ferrante decision was the provision of the Act providing for dismissal of any asbestos claim pending on April 12, 2005, unless within 180 days from that date the plaintiff in a pending asbestos claim establishes “prima-facie evidence of physical impairment with respect to the asbestos claim.⁷

Constitutional Challenges 

The Ferrante case arose out of multiple asbestos actions pending in the Cobb County Superior Court and Cobb County State Court. The Supreme Court of Georgia consolidated the appeals of various “virtually identical orders ruling that because the Act required plaintiffs to provide proof that exposure to asbestos was a substantial contributing factor in their medical condition, it unconstitutionally affected appellee’s substantive rights by establishing a new element to [their] claim, one that did not exist when the original cause of action accrued.”⁸

In its decision, the court noted that, “[p]rior to the passage of the Act, in order to establish a claim for asbestos related injuries, a plaintiff was required to show only that exposure to asbestos was a contributing factor in his or her medical condition.”⁹ The court concluded that the “substantial contributing factor” requirement added by the Act imposes upon the appellees a “greater evidentiary burden than was required under the law in effect at the time their actions were filed.” In considering the constitutionality of this “greater evidentiary burden,” the court pointed to the Georgia Constitution’s ban on retroactive laws.¹⁰ The court recognized its prior precedent on that constitutional provision, quoting from Enger v. Erwin¹¹ as follows: “Although legislation which involves mere procedural or evidentiary changes may operate retrospectively, legislation which affects substantive rights may operate prospectively only.”¹² 

The basic question put before the court was whether the retroactive application of the “greater evidentiary burden” was a procedural or evidentiary change or a change that affected the appellees’ substantive rights. The court rejected appellants argument that the change was only procedural or evidentiary, concluding that “requiring appellees to produce evidence establishing that exposure to asbestos was a substantial contributing factor to their medical conditions affect appellee’s substantive rights and cannot retroactively be applied to their claims.”¹³

The court’s method for distinguishing between procedural or evidentiary changes and changes that are substantive lied in the ultimate result in this case. The court rejected the notion that retroactive application of the “prima facie evidence of physical impairment” requirement could be procedural given that plaintiff s cannot make the prima facie showing of causation under the new legislation; whereas, before passage of the Act, their claims would survive.¹⁴ It was important to the court’s reasoning that the substantial contributing factor showing is an “essential element” of the newly defined asbestos claim.¹⁵ Thus, under the court’s expressed logic, if the Legislature’s change would not affect the plaintiffs’ ability to maintain their asbestos claims then it is conceivable that the Act would not have been deemed substantive. 

The appellants also argued that even if the new “prima facie evidence of physical impairment” requirement could not be applied to these particular appellees, the trial court should have just severed the unconstitutional language from the Act as applied to appellees without striking down the entire Act. The court noted its power to sever an unconstitutional portion of a statute and allow the remaining portion to survive; however, it stated that if “the objectionable part is so connected with the general scope of the statute that, should it be stricken out, effect cannot be given to the legislative intent, the rest of the statute must fall with it.”¹⁶ 

Although the Act provided for a comprehensive scheme for handling asbestos claims going forward that appeared to be independent of the retroactive application piece provided for in O.C.G.A. § 51-14-5(a), the court concluded that the entire Act must fall, given that the prima facie evidence requirements, particularly the “substantial contributing factor” element, lie at the heart of the legislation and “severance from the Act would result in a statute that fails to correspond to the main legislative purpose, or give effect to that purpose.”¹⁷ It is important to recognize that the court, in the first part of its decision, held the retroactive application of the Act unconstitutional, not the requirement that plaintiff s establish “prima facie evidence of physical impairment” as that term is defined in the Act. Nonetheless, rather than determining whether the retroactive application of the Act was “so connected with the general scope” of the Act for severance purposes, the court appears to have focused on the prima facie evidentiary requirements in seeking to determine whether the unconstitutional portions of the Act were severable. It is not entirely clear whether the court merely failed to sever the unconstitutional portions of O.C.G.A. § 51-14-5 from that provision or refused to sever the unconstitutional portions of § 51- 14-5 from the entire Act.¹⁸ It would appear that there could be various arguments as to the exact scope of the court’s decision on the issue of severability; thus, it would appear to be entirely possible that the court will have to address the scope of its decision on severability in a subsequent case. 

 

Endnotes

1 281 Ga. 273, 637 S.E.2d 659 (2006). 

2 Justice Harold Melton did not participate in the decision. 

3 O.C.G.A. § 51-14-2(15); O.C.G.A. § 51-14-3(b). 

4 Codified at O.C.G.A. §51-14-1 et seq. 

5 This medical condition includes pleural or peritoneal mesothelioma, cancer or a nonmalignant disease related to asbestos. O.C.G.A. § 51-14-2(15). 

6 O.C.G.A. § 51-14-4. 

7 O.C.G.A. § 51-14-5(a). 

8 Quotations from the trial court orders omitted. Id. at 273, 637 S.E.2d at 661. The court heard these appeals based on the trial courts having issued certificates of immediate review and having granted the appellee’s applications for interlocutory appeal. O.C.G.A § 6- 5-34(b). 

9 Citing John Crane, Inc. v. Jones, 278 Ga. 747, 604 S.E.2d 822 (2004). 

10 Ga. Const., Art. I, § I, Par. X. 

11 345 Ga. 753, 754, 267 S.E.2d 25 (1980). 

12 Id. at 274, 637 S.E.2d at 661. 

13 Id. 

14 Id. at 274 fn. 1, 637 S.E.2d at 661. 

15 Id. at 274, 637 S.E.2d at 661. 

16 Citing City Council of Augusta v. Magelly, 243 Ga. 358, 363(2), 354 S.E.2d 315 (1979). 

17 Id. at 275, 637 S.E.2d at 662 (citations and quotations omitted). 

18 It is worth noting that the Act had a severability clause. The Court discussed this point, noting that “[t]he presence of a severability clause reverses the usual presumption that the legislature intends the Act to be an entirety, and creates an opposite presumption of severability. However, the severability clause does not change the rule that in order for one part of a statute to be upheld as severable when another is stricken as unconstitutional, they must not be mutually dependent on one another.” Id. at 275, 637 S.E.2d at 662 (quoting City Council of Augusta v. Mangelly, 243 Ga. 358, 363- 64, 254 S.E.2d 315 (1979).

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