Tuesday, February 24, 2009

Mo. Alliance for Retired Ams. v. Dep’t of Labor & Indus. Relations

Opinion handed down February 24, 2009
Link to Mo. Sup. Ct. Opinion

The Supreme Court of Missouri held that eight counts of a nine-count petition challenging the constitutional validity of the 2005 amendments to Missouri’s workers’ compensation statutes were neither justiciable nor ripe for review. Regarding the remaining count, the Court held that the amendments removed certain injuries previously covered by workers’ compensation from the scope of the workers’ compensation system, and workers suffering such injuries may now seek compensation for those injuries from their employers at common law.

I. Facts and Holding[1]

In 2005, the Missouri General Assembly significantly amended Missouri’s workers’ compensation laws. As a result of the amendments, seventy-one organizations, consisting mainly of labor organizations, filed a nine-count petition against the state challenging the constitutional validity of the amendments. The Supreme Court of Missouri held that eight of the counts, those either challenging the validity of the statute as a whole or challenging the specific statutory provisions, were not justiciable. The Court ruled that the final count, seeking a declaratory judgment as to the rights of injured workers whose injuries no longer fell within the scope of the law, was justiciable. On that count, the Supreme Court of Missouri, noting that the amendments narrowed the scope of what injuries fall within and are compensable under the worker’s compensation system, held that individuals suffering injuries that now fall outside the scope of the system can instead seek redress under the common law.

II. Legal Background

A. Justiciability and Ripeness

In Missouri, a declaratory judgment action requires a justiciable controversy,[2] and a justiciable controversy exists if: “(1) the plaintiff has a legally protectable interest at stake; (2) a substantial controversy exists with genuinely adverse interests; and (3) the controversy is ripe for judicial determination.”[3]

i. Legally Protectable Interest

Plaintiffs have a legally protectable interest at stake if they can show “a pecuniary or personal interest directly at issue and subject to immediate or prospective consequential relief.”[4] Missouri courts then use case-by-case analyses to determine whether plaintiffs demonstrate such pecuniary or personal interest in the action.[5] “[W]here a dispute as to legal rights is otherwise shown [in a declaratory judgment suit], a violation of those rights is not a precondition to the availability of declaratory adjudication.”[6] For most counts in the present case, the Supreme Court of Missouri held that the plaintiffs established that they had a legally protected interest at stake in the suit. For the counts that the plaintiffs asked the Court to declare specific provisions of the amendments unconstitutional – the amendments, plaintiffs claimed, provided no adequate remedy for an injured worker – the Court held these claims non-justiciable. The Court reasoned that no individual workers’ compensation claims were before the Court supporting such assertions, leaving only hypothetical situations for the Court.[7]

ii. Substantial Controversy

The Court, without significant analysis, agreed with the plaintiff labor organizations that a substantial controversy with genuinely adverse interests existed.[8]

iii. Ripeness

“A ripe controversy exists if the parties’ dispute is developed sufficiently to allow the court to make an accurate determination of the facts, to resolve a conflict that is presently existing, and to grant specific relief of a conclusive character.”[9] Where the state has not attempted to enforce the statute, as is the case here, a ripe controversy can still exist “when the facts necessary to adjudicate the underlying claims [a]re fully developed and the laws at issue [a]re affecting the plaintiff in a manner that g[i]ve[s] rise to an immediate, concrete dispute.”[10] The Supreme Court of Missouri noted that the record did not contain any information or facts illustrating how the new law is being interpreted or applied. The Court held as to all but one of the remaining counts that the issues presented in the counts were not ripe for judicial review. The Court did hold that the count seeking declaratory judgment as to the rights of injured workers whose accidents no longer fall within the scope of the act was an issue ripe for judicial review.[11]

B. Request for Declaratory Judgment

The basic premise behind the workers’ compensation system is that workers “surrender[] the right to sue their employers at common law in exchange for lower but certain compensation, without regard to fault, in all cases of accidental work-related injury.”[12] Mo. Rev. Stat. § 287.120 codifies this principle.[13] The plaintiff labor organization sued the state to determine whether the exclusivity clause in Mo. Rev. Stat. § 287.120, which prevents employees from suing their employers under the common law for accidental injuries, prevents injured workers from suing their employers since certain injuries now fall outside the scope of the statute. The Court, based on a straightforward reading of the exclusivity provision, held that if workers’ injuries fall outside of the statutory definition of injury, then the workers’ compensation system did not apply to them and the workers are free to pursue any remedy at law. [14]

C. Concurring and Dissenting Opinions[15]

Judge Wolff, joined by Judges Russell and Price, concurred in the plurality opinion. Judge Wolff asserted that he would have also held that the count relating to the scope of the exclusivity clause was hypothetical and not ripe for review.

Judge Teitelman dissented in the opinion and argued that the amendments to the workers’ compensation statutes violated article I, section 14 of the Missouri Constitution. Article I, section 14 contains the “open courts” provision. Judge Teitelman emphasized that the open courts provision requires an adequate substitute remedy when “the legislature abrogates a common law cause of action for personal injury.”[16] Since a substitute remedy is required, Judge Teitelman next examined “whether the amendments at issue in this case so restrict compensation for workplace injuries that they violate article I, section 14.”[17] Judge Teitelman believes that the 2005 amendments dramatically alter the workers’ compensation bargain[18] between employers and employees by reducing the compensation for injured workers and excluding large classes of workers from any remedy. Judge Teitelman underscored that this shift in the bargain, without substitute remedies, “effectively bars injured workers from realizing the constitutional guarantee of a ‘certain remedy . . . for every injury to person, property, or character . . . .’”[19]

III. Commentary

Although Missouri Alliance does not provide any new legal tests or analysis regarding the justiciability and ripeness of claims, this case could have important consequences for persons employed in Missouri. This case appears to open the door for more litigation surrounding workplace injury. Workers that once turned to the workers’ compensation system to recover monetarily for their injuries might now have to turn to civil litigation to receive any redress. This could increase costs for businesses that now have to litigate worker injury claims that previously were paid for through the workers’ compensation system. Additionally, this could prevent workers injured at their jobs who don’t qualify for workers’ compensation from receiving any compensation. If the injury is not substantial, workers might not receive enough compensation to warrant bringing suit against their employer.

- Joseph E. Bredehoft

[1] Mo. Alliance for Retired Ams. v. Dep’t of Labor & Indus. Relations, No. SC 88368, 2009 WL 454282, at *1-2 (Mo. 2009).
[2] Akin v. Dir. of Revenue, 934 S.W.2d 295, 298 (Mo. 1996).
[3] Mo. Alliance, 2009 WL 454282, at *4; see also State ex rel. Chilcutt v. Thatch, 221 S.W.2d 172, 176 (Mo. 1949).
[4] Lane v. Lensmeyer, 158 S.W.3d 218, 222 (Mo. 2005).
[5] Mager v. City of St. Louis, 699 S.W.2d 68, 70 (Mo. Ct. App. 1985).
[6] Higday v. Nickolaus, 469 S.W.2d 859, 863 (Mo. Ct. App. 1971).
[7] Mo. Alliance, 2009 WL 454282, at *4.
[8] Id. at *5.
[9] Mo. Health Care Ass’n v. Attorney Gen., 953 S.W.2d 617, 621 (Mo. 1997).
[10] Id.
[11] Mo. Alliance, 2009 WL 454282, at *5.
[12] Mo. Alliance, 2009 WL 454282, at *2.
[13] Mo. Rev. Stat. § 287.120 (Supp. 2008).
[14] Mo. Alliance, 2009 WL 454282, at *6-7.
[15] Judge Wolff’s concurrence is located at id. at *8 and Judge Teitelman’s dissent at id. at *8-12.
[16] Id. at *10.
[17] Id.
[18] The bargain is that the employer assumes automatic liability and the employee forfeits any action at common law.
[19] Id. at *12 (quoting the open courts provision of Mo. Const. art I, § 14).