August 11, 2010

Justice Cantil-Sakauye decides Supreme Court issue

Presumptive future Chief Justice of the California Supreme Court Tani Cantil-Sakauye issued an opinion Monday on one of the most important issues pending before that court. How can she be deciding the court’s most important issues before she has even been confirmed? Because she’s still a sitting justice on the California Court of Appeal. In that capacity, she issued an opinion in King v. Willmett, deciding the precise issue that is pending before the Supreme Court in Howell v. Hamilton Meats.

The issue is whether a personal injury plaintiff’s recoverable medical expense damages can include not only what she and her health insurance company paid for her medical services, but also larger amounts “billed” by her healthcare providers, even if the providers agreed to accept the paid amounts as payment in full and neither plaintiff nor her insurer will ever pay any larger amounts. In other words, if you are injured in a car accident and you receive a hospital bill for $1 million, but your health insurer pays the hospital only $100,000 as payment in full, can you recover $1 million in medical expense damages in a lawsuit against the other driver, or are you limited to a recovery of $100,000? This is literally a billion dollar issue, affecting virtually every personal injury action in California.

Justice Cantil-Sakauye’s opinion in King adopts the position advocated by the Consumer Attorneys of California: the plaintiff can recover more than the actual amount that the healthcare actually gets paid for its services. Undoubtedly, the defendant will ask the Supreme Court to grant review in this case, since the same issue is already before the court in Howell.

Justice Cantil-Sakauye won’t join the Supreme Court until after it rules on the petition in King. If King is a grant-and-hold case, as is likely, Chief Justice Cantil-Sakauye will not be able to participate in the non-controversial decision of how to dispose of that case once the court issues its opinion in Howell. Canon 3E(5)(f) of the California Code of Judicial Ethics provides that an appellate justice is disqualified if “[t]he justice (i) served as the judge before whom the proceeding was tried or heard in the lower court.”

FULL DISCLOSURE: Horvitz & Levy has briefed the Howell issue in several matters. In Howell itself we filed an amicus curiae brief supporting the defendant in the Court of Appeal proceedings, and we intend to seek leave to file an amicus brief in the Supreme Court as well. We have also briefed this issue on behalf of the defendants in Yanez v. Soma Environmental Engineering, Inc. and our petition for review in that case is currently pending before the Supreme Court.

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