Carrion v. Linzey

KARWACKI, Judge. We are once again asked to construe the statutory presumption of correctness that attaches to the finding of a health claims arbitration panel decision in a subsequent circuit court “judicial review.” Maryland Code (1974, 1995 Repl.Vol.), § 3-2A-06(d) of the Courts & Judicial Proceedings Article. 1 Twice previously we have interpreted this provision. In Attorney General v. Johnson, 282 Md. 274 , 385 A.2d 57 (1978), appeal dismissed, 439 U.S. 805 , 99 S.Ct. 60 , 58 L.Ed.2d 97 (1978), we held that the statutory presumption of correctness did not violate constitutional guarantees of a fair trial. In Newell v. Richards, 323 Md. 717 , 594 A.2d 1152 (1991), we held that the presumption did not shift the ultimate burden of proof of negligence from plaintiff to defendant in the trial of a case where the panel’s decision was adverse to the defendant.

In the case sub judice we look again at the statutory presumption of correctness, this time to explore what a jury should be told about an arbitration panel’s membership and vote. Implicit within this inquiry is a more fundamental question about how a party, aggrieved by a decision of an arbitration panel, may attack that decision to overcome the presumption of correctness. I. This appeal arises out of Robert P. Linzey’s claim of dental malpractice against Dr. Timothy J. Carrion, Dr. Donald B. ²⁷⁰ Lurie, 2 and their employer, Donald B. Lurie, D.D.S., P.A. [hereinafter, the appellants will be referred to collectively as “Carrion”]. On May 18,1987, Carrion performed oral surgery on Linzey.

This procedure, called a bilateral sagittal split osteotomy, was intended to correct an “open bite” by moving Linzey’s lower jaw into proper alignment with his upper jaw. As part of the procedure, Carrion applied fixation devices to secure the lower jaw during healing. When the fixation devices were removed five weeks later, all signs indicated that the surgery had been successful. Two weeks later, however, a follow-up examination revealed that his lower jaw was not properly healing, allowing the jaw to slip back into its previous position.

Carrion then performed a second operation to reposition the lower jaw. By November of 1987, unsatisfied with Carrion’s care, Linzey found a new orthodontist who performed a third surgery to correct Linzey’s “open bite.” In May of 1990, Linzey filed a claim of dental malpractice with the Director of the Health Claims Arbitration Office in accordance with the procedures set forth in the Health Claims Arbitration [“HCA”] Act, § 3-2A-01, et seq. An arbitration panel was assembled which included John F. Burgan, Esq., panel chair, Dr. Carl J. Oppenheim, a dentist, and Dr. Edward Beach, a Ph.D in Education and the lay member of the panel. On March 5, 1992, at the conclusion of a four-day arbitration hearing, the panel found Carrion liable for malpractice and awarded damages of $167,600.

Counsel for Carrion contacted the arbitration panel members, and on March 21, 1992, procured an affidavit from Dr. Oppenheim who swore that he had dissented from the decision of the panel. Carrion then attempted to make use of the revisory power of the panel chair, granted by § 3-2A-05, to have the panel’s award reflect the split decision. Chairperson Burgan by order dated April 17, 1992, declined to modify the ²⁷¹ award to reflect Dr. Oppenheim’s dissenting vote. Carrion then filed an action to reject the arbitration award in the Circuit Court for Baltimore City, where the case was scheduled for a jury trial.

At the beginning of trial Carrion filed a motion in limine to clarify what the jury could be told about the arbitration panel’s membership and decision. At issue were three general facts: 1. that the panel was composed of a lawyer, a dentist, and a lay person; 2. that the decision of a panel need not be unanimous; and 3. that the dentist member of the panel (Dr. Oppenheim) had dissented. Carrion would have preferred that all three of these facts be brought to the jury’s attention because he hoped that the jury might tend to give less weight to a split decision than to a unanimous decision, and because an impartial dentist’s opinion might be very persuasive in convincing the jury that Carrion had not breached the standard of care. Short of the jury being told all three facts, Carrion hoped to avoid a circumstance in which the jury would learn about the panel membership, but not learn that a panel decision need not be unanimous and was not unanimous in this case.

Carrion’s concern was that the jurors, knowing that their decision must be unanimous, would assume that the arbitration panel’s decision also had to be unanimous, and knowing the composition of the panel, would conclude that the dentist-panel member had found Carrion liable. Carrion feared that this erroneous conclusion would weigh heavily with the jury as the panel-dentist would be perceived as an expert on dental care offering an impartial opinion that Carrion was liable. The trial judge ruled that evidence of the panel’s membership and vote would be inadmissible at trial and issued an order in limine to exclude references to these facts. “When counsel remarked (prophetically) that the jury was going to wonder about the composition of the panel, the trial judge responded, ‘And I am going to tell them it is none of their ²⁷² business.’ ” Linzey v. Carrion, 103 Md.App. 116, 121 , 652 A.2d 1154, 1156 (1995). The case was tried on June 16-23, 1993, and the trial judge described it as “a vigorously contested case, well-tried on both sides----” Late in the proceedings, counsel for both parties read into evidence portions of Linzey’s testimony at the arbitration panel hearing.

Linzey’s counsel, who may have been simply attempting to give the jury some context for the testimony, mentioned that a question from the panel was asked by “Dr. Oppenheim.” Counsel did not identify Dr. Oppenheim either as a panel member or as a dentist. After the jury was excused, Carrion’s counsel objected, but the trial judge ruled that no irreparable harm had come from the mention of “Dr. Oppenheim.” After they began deliberating, however, the jurors sent out a question: “Who sat on the Arbitration Panel? Were they health professionals and/or lay people?” Although Linzey denies that counsel’s mention of “Dr. Oppenheim” caused the jury to ask the question, the trial transcript reveals that the trial judge believed that the mention of “Dr. Oppenheim” led directly to the jury question. While the jury’s desire for this information would not be surprising under any circumstances, we do not fault the trial judge’s assumption that there was a causal connection between the mention of “Dr. Oppenheim” and the jury’s question.

After consulting with counsel, the trial judge re-instructed the jury. This time he told the jury both of the composition of the panel and that its decision had not been unanimous: “The law in Maryland provides that the Health Claims Arbitration Boards consist of one layperson, one lawyer and one health care professional. In this case those were the three categories of persons who sat on the Health Claims Arbitration Board, and that board ruled, as you know, in favor of Mr. Linzey, the Plaintiff, by a two-to-one vote. Unlike the jury system in Court, the verdict of the Health Claims Arbitration Board need not be unanimous.” ²⁷³ The jury retired again to consider the instruction.

Eventually they returned a verdict nullifying the arbitration panel’s decision, and finding Carrion not liable to Linzey for his injuries. Linzey’s motion for new trial was denied and he appealed to our intermediate appellate court. The Court of Special Appeals, in Linzey v. Carrion, supra, held that it is always proper for a trial judge to inform the jury about certain statutory facts, including the standard membership of an arbitration panel and that a decision by the panel need not be unanimous. The court held, however, that informing the jury of the split decision of the panel in a specific case served to weaken the statutory presumption of correctness impermissibly.

As a result, the court reversed the judgment and remanded the case for a new trial. We granted Carrion’s petition for a writ of certiorari to review that decision.

II

Carrion’s argument in this Court is based on two contentions. First, he suggests that unless otherwise instructed, a jury would assume that an arbitration panel decision, like the jury’s own decision, must be unanimous. Thus, when an arbitration panel finds in favor of the plaintiff, the jury will infer that the panel’s health-care provider, a neutral expert, found the defendant’s conduct to be negligent. Second, Carrion argues, the jury will likely place considerable weight on the determination of a neutral expert, and so the jury’s erroneous assumptions will be particularly damaging to the defendant.

Carrion points out that this string of inferences is most damaging in cases such as his, where the arbitration panel’s health-care provider actually dissented from the finding of liability but the jury is not informed of the dissent. Alternatively, Carrion argues that even if it is not ordinarily permissible to tell a jury that an award was not unanimous, the instruction given by the trial court in this case was appropriate to remedy the damage caused by opposing counsel’s mention of “Dr. Oppenheim.” ²⁷⁴ Linzey argues that any mention of the panel’s vote weakens the legal presumption of correctness of the panel’s decision. He stresses that the presumption of correctness advances the important policy goal of reducing medical malpractice litigation by forcing potential malpractice litigants to marshal a complete evidentiary showing in the arbitration hearing, and thereby increasing the number of cases that are resolved at the arbitration hearing stage.

III

A. The History of the Health Claims Arbitration Act. The history of the medical malpractice insurance crisis that occurred in Maryland in the mid-1970s has been documented extensively elsewhere, so here we merely sketch the history. See, e.g., Harry J. McGuirk & F. Thomas Rafferty, Medical Malpractice and the Maryland Legislature, 6 Md.L.Forum 9 (1976); James Kevin MacAlister & Alfred L. Scanlon, Jr., Health Claims Arbitration in Maryland: The Experiment Has Failed, 14 U.Balt.L.Rev. 481, 487-90 (1985). Despite being granted a large rate increase in 1974, St. Paul Fire & Marine Insurance Company [“St. Paul”], then Maryland’s largest malpractice insurance carrier, gave notice in 1975 that it intended to withdraw from the market as St. Paul considered it no longer profitable.

The State Insurance Commissioner issued an order prohibiting St. Paul’s withdrawal and requiring it to continue to provide insurance coverage. The Baltimore City Court affirmed the Insurance Commissioner’s order. This Court reversed, holding that the Insurance Commissioner could not require St. Paul to remain in the medical malpractice liability insurance market. Our order, issued immediately after oral argument, did not become valid until several months later when the opinion was issued.

The delay between our order and its effective date permitted the General Assembly sufficient time to act to avert a crisis. St. Paul Fire & Marine Ins. Co. v. Insurance Comm’r, 275 Md. 130 , 339 A.2d 291 (1975). ²⁷⁵ The General Assembly responded by creating the Medical Mutual Liability Society of Maryland. Ch. 544 of the Acts of 1975 codified as Md.Code (1957, 1972 Repl.Vol., 1977 Cum.

Supp.), Art. 48A, §§ 548-556. This non-profit insurance company quickly became the primary insurer of Maryland’s physicians. Attorney General v. Johnson, 282 Md. 274, 280-81 , 385 A. 2d 57, 61 (1978). The Legislature also shortened the statute of limitations for instituting medical malpractice claims, ch. 545 of the Acts of 1975, codified as § 5-109, and passed a law to promote peer review for physicians, ch. 423 of the Acts of 1975, codified as Md.Code (1981, 1994 Repl.Vol., 1995 Cum.

Supp.), § 14-501 et seq. of the Health Occupations Article. Most importantly, the General Assembly created a committee to study methods of reforming the manner in which the legal system responds to claims of medical malpractice. The Medical Malpractice Study Committee was appointed on July 23,1975, and on January 6,1976, issued its report. The Committee proposed adoption of a mandatory medical malpractice arbitration system in Maryland, contending that such a system would improve on the traditional tort system in several ways.

First, effective arbitration would discourage litigation of non-meritorious claims, because, in part, evidentiary weaknesses would become apparent during the arbitration stage. Second, arbitration would encourage the early settlement of meritorious claims, because a panel finding of liability would encourage health care professionals and their insurance carriers to settle. Third, the Committee believed that the expertise of the panel members, as opposed to jurors, would lead to accurate decisions in more cases as well as reasonable and predictable damage awards. Accompanying the text of the committee report was proposed legislation, which ultimately was adopted as ch. 235 of the Acts of 1976, and codified as § 3-2A-01, et seq.

B. Features of the Health Claims Arbitration Act. In Attorney General v. Johnson, 282 Md. 274 , 385 A.2d 57 (1978), we reviewed the salient features of the Health Claims ²⁷⁶ Arbitration Act. We emphasized that the primary feature of the new system was to “require the submission of certain [medical malpractice] claims to an arbitration panel for initial ascertainment of liability and damages before resort may be had to a court of law for final determination,” i.e., mandatory arbitration. 3 Id. at 277 , 385 A.2d at 59 . We went on to discuss the specific features of the system: “All malpractice claims against health care providers seeking damages of more than $5,000 are subject to the provisions of the Act, and must be initially filed, as must the responses to them, with the Health Claims Arbitration Office, created by the statute ‘as a unit in the Executive Department.’ The office, acting through its director, refers all issues raised to a three-member arbitration panel, chosen at random from lists of qualified persons prepared and maintained by the director; the panel for each claim is to be composed of an attorney, a health care provider, and a member of the general public.

The arbitration panel determines whether the health care provider is liable to the claimant and if so the extent of the damages, and incorporates in its award an assessment of costs, including arbitrators’ fees; if no party rejects the award, it becomes final and binding, is filed by the director -with the appropriate circuit court, and when confirmed by that court constitutes a final judgment. Neither party, however, is in any way bound to accept the award; it may be rejected for any reason within ninety days. If a party desires to contest the decision of the panel, he must file an action in the appropriate court during the ninety-day period to nullify the award, and jury trial may be elected by either party. Any contention that an award should be vacated on the ground of corruption, fraud, partiality or the like is to be decided by the court prior to trial.

Unless the award is thus vacated, it is admissible as evidence at the trial and presumed to be ²⁷⁷ correct, with the burden of proving the contrary falling on the party rejecting it; should the award be vacated, ‘trial of the case shall proceed as if there had been no award.’ In addition, attorneys’ fees are subjected to the approval respectively of the arbitration panel and the court.” Id. at 279-80 , 385 A.2d at 60-61 (citations and footnotes omitted). See also James Kevin MacAlister & Alfred L. Scanlon, Jr., Health Claims Arbitration in Maryland: The Experiment Has Failed, 14 U.Balt.L.Rev. 481, 493-97 (1985). Of particular significance to the case sub judice is the statutory presumption of correctness that attaches to the decision of an arbitration panel in a subsequent circuit court judicial review. C. The Presumption of Correctness.

We begin with an analysis of the statutory presumption of correctness for two related reasons. First, the admissibility of the arbitration panel’s membership and voting is, at its center, a question concerning how a party that lost at the arbitration stage may attack the presumption of correctness. Determining the “strength” of that presumption is thus vital to an understanding of the methods that may be employed to attack the presumption. Second, there are several theories regarding the effect of presumptions generally.

Each of these theories carries with it correlative principles about instructing a jury about the effect of the presumption. For us to determine what a jury can be told about the panel membership and vote, we must understand the theories of presumptions that may apply. Although many states have adopted systems of arbitration for medical malpractice claims, the statutory presumption of correctness given a panel decision in subsequent litigation is a feature unique to Maryland’s system. Comment, The Constitutionality of Medical Malpractice Mediation Panels: A Maryland Perspective, 9 U.Balt.L.Rev. 75, 76 n. 7 (1979).

In the arbitration schemes adopted by other states, the panel deci ²⁷⁸ sion may or may not even be admissible. 4 Our sister states can thus provide no guidance. Instead we will make a three part inquiry, looking at presumptions under general Maryland law, examining the legislative history of the presumption of correctness contained in this statute, and by reviewing our decisions regarding this presumption. 1. Presumptions Generally. Effective July 1, 1994, this Court for the first time adopted an evidence code for the courts of Maryland.

Among the rules adopted was Rule 5-301(a), which provides: “Effect [of Presumptions in Civil Actions].—Unless otherwise provided by statute or by these rules, in all civil actions a presumption imposes on the party against whom it is directed the burden of producing evidence to rebut the presumption. If that party introduces evidence tending to disprove the presumed fact, the presumption will retain the effect of creating a question to be decided by the trier of fact unless the court concludes that such evidence is legally insufficient or is so conclusive that it rebuts the presumption as a matter of law.” The comments of the Court of Appeals Standing Committee on Practice and Procedure indicate that this rule is intended to codify the approach of this Court in Grier v. Rosenberg, 213 Md. 248 , 131 A.2d 737 (1957), and rejects both the “Thayer-Wigmore bursting bubble” approach found in Fed.R.Evid. 301 and the “Morgan-type” presumption of Unif.R.Evid. 301 (1986). Under the “bursting bubble” theory of presumptions, “a presumption operates in favor of a party who has the burden of proof by shifting to the other party the duty of going forward with the evidence on the issue. In effect, this ²⁷⁹ means that the party relying on the presumption can get past a motion for a directed verdict made at the close of his case without any direct proof of the presumed fact, and may succeed with respect to that issue if the other party does not come forward with evidence....

Once the other party produces evidence on the issue sufficient to support a finding contrary to the presumed fact, the bubble is burst and the presumption no longer exists in the case.” Note, Presumptions in Civil Cases: Procedural Effects Under Maryland, Law in State and Federal Forums, 5 U.Balt.L.Rev. 301, 305-06 (1976) (footnotes omitted). In a “bursting bubble” presumption, the jury is never told about the presumption. Id. at 306 . Alternatively, a Morgan-type presumption shifts the burden of persuasion on a given issue.

Graham C. Lilly, An Introduction to the Law of Evidence 54 (1978) (citing Edmund Morgan, Some Problems of Proof 74-81 (1956)). 5 In a Morgan-type presumption there is no need to inform the jury of the presumption, only of the allocations of the burden of persuasion. Instead of either of these approaches, we adopted Md.Rule 5-301. Although Md.Rule 5-301 was not itself in effect when the instant case was tried in June of 1993, it merely codified the existing common law of Maryland, and so the same principle applied. As Professor Alan Hornstein of the University of Maryland, School of Law explains it: “Under Rule 5-301 [and the common law rule that preceded the rule’s adoption], presumptions do not affect the burden of persuasion.

A presumption merely satisfies the burden of production on the fact presumed and, in the absence of rebutting evidence, may satisfy the burden of persuasion. If there is rebutting evidence, the presumption retains only ²⁸⁰ enough vitality to create a jury question on the issue, and the jury is instructed on the presumption.” Alan D. Hornstein, The New Maryland Rules of Evidence: Survey, Analysis and Critique, 54 Md.L.Rev. 1032, 1049 (1995). Maryland Rule 5-301, therefore, describes the effect that a presumption should have unless a specific presumption is given more or less weight by rule, statute, or judicial interpretation. Alone among the three theoretical models, the Md.Rule 5-301 presumption requires informing the jury of the existence of the presumption.

As our predecessors said in Grier v. Rosenberg, 213 Md. 248 , 131 A.2d 737 (1957), “if the instruction [on the existence of a presumption] be not granted, how is the jury to know of the presumption?” Id. at 253 , 131 A.2d at 739 . See also Note, Presumptions in Civil Cases: Procedural Effects Under Maryland Law in State and Federal Forums, 5 U.Balt.L.Rev. 301, 310-11 (1976). 2. Legislative History of Presumption of Correctness in the Health Claims Arbitration Act. The Medical Malpractice Study Committee’s proposal to adopt mandatory medical malpractice arbitration included a description of the following feature of the proposed system: “5.

Any party shall have the right to reject an award and file an action in court, with the right of de novo trial before judge or jury. However, the award is admissible in evidence and given a presumption of correctness, in the same manner as Workmen’s Compensation Commission awards.[ 6 ] Moreover, if the rejecting party (appellant) does not receive a verdict more favorable to him than the award he rejected, he will pay the costs of the judicial proceedings.” Accompanying the text of the report is proposed legislation, which became the genesis of the HCA Act, adopted as ch. 235 of the Acts of 1976. Each version, from the Committee’s ²⁸¹ initial proposal to that enacted in 1976 contained similar language: “Unless vacated by the court pursuant to subsection (c), the arbitration award is admissible as evidence in the judicial proceeding. The award shall be presumed to be correct, and the burden is on the party rejecting it to prove that it is not correct.” Ch. 235 of the Acts of 1976.

With the single exception of the addition of the adjective “unmodified” before the word “arbitration” by ch. 596 of the Acts of 1987, the provision has remained unchanged since adoption. Section 3-2A-06(d). Similar language is found in the Md.Rules: “Unless the arbitration award is vacated pursuant to Code, § 3-2A-06(c), Courts Article, it is admissible as evidence and the burden of proof is on the party rejecting the award to show that it is not correct.” Md.Rule BY5. While the Medical Malpractice Study Committee was doing its research in the fall of 1975, the Maryland State Bar Association [“MSBA”] apparently became concerned about the proposals being discussed.

In August of 1975, MSBA president, Wilbur D. Preston, Jr., Esq. appointed a “Special Committee to Study Problems Related to Medical Malpractice in Maryland.” The MSBA Special Committee’s report was adopted in a series of resolutions by the Board of Governors of the MSBA. Those resolutions proposed a non-binding, screening panel as well as a lesser weight to be assigned the arbitrators’ decision in a subsequent trial: “5. The [arbitration] panel would issue a brief written decision as to liability and damages, if any, stating also the facts upon which its determinations are based. The panel’s written decision and any dissenting opinion would be admissible at any subsequent trial, if in conformity with applicable law and not arbitrary or capricious.

Panel members themselves would not be subject to subsequent subpoena. In the event that the decision of the screening [arbitra ²⁸² tion] panel is in favor of the plaintiff, the defendant could offer to settle the dispute for the amount of damages awarded by the panel. If the plaintiff rejects this offer, then the decision of the panel ... should not be admissible over that defendant’s objection at a subsequent trial of the case.” (Emphasis added). The proposals of the MSBA special committee were explained to “three standing Committees of the Maryland General Assembly,” by Kenneth S. Abraham, Esq., Vice Chairman of the Special Committee, and an Assistant Professor of Law at the University of Maryland. 7 Looking back, we can say with some assurance that the General Assembly was aware of the broad range of legislative choices it faced in creating the Health Claims