Bankers Life & Cas. Co. v. Crenshaw, 486 U.S. 71 (1988)

Bankers Life & Casualty Co. v. Crenshaw

No. 85-1765

Argued November 30, 1987
Decided May 16, 1988
486 U.S. 71

APPEAL FROM THE SUPREME COURT OF MISSISSIPPI

Syllabus

In a state court suit upon an insurance claim for loss of a limb, the jury awarded appellee the $20,000 provided by his policy and punitive damages of $1.6 million based on appellant’s bad-faith refusal to pay the claim. Concluding that the punitive damages award was not excessive in light of appellant’s financial worth and the degree of its wrongdoing, the Mississippi Supreme Court affirmed the verdict without modification, and assessed an additional 15% penalty against appellant in accordance with a state statute imposing such a penalty on parties who appeal unsuccessfully from money judgments or other categories of judgments whose value may be readily determined. Although the appeal had not raised a federal constitutional challenge to the size of the punitive damages award, appellant argued, in its petition for rehearing, that the award "was clearly excessive, not reasonably related to any legitimate purpose, constitutes excessive fine, and violates constitutional principles." Appellant’s Motion to Correct Judgment also alleged that the statutory penalty violated its equal protection rights under the Federal and State Constitutions. Without opinion, the State Supreme Court denied the petition for rehearing and the Motion to Correct Judgment.

Held:

1. This Court will not reach appellant’s claims that the punitive damages award violated the Due Process, Contract, and Excessive Fines Clauses of the Federal Constitution, since those claims were not raised and passed upon in state court. Hathorn v. Lovorn, 457 U.S. 255, distinguished. The petition for rehearing’s vague and general appeal to constitutional principles was insufficient to adequately raise the Contract Clause or due process claims. Similarly, the petition’s reference to the award’s excessiveness is too oblique to have properly raised the Federal Excessive Fines Clause claim, since no mention was made of the Clause, the Federal Constitution, or federal law, and the Mississippi Constitution contains its own Excessive Fines Clause, which the State Supreme Court could have taken to underlie the excessiveness challenge if it understood appellant to be offering a constitutional challenge. Assuming that this Court’s "not pressed or passed upon below" rule is not jurisdictional, but is merely a prudential restriction, the more prudent course here is to decline review of the important and difficult Federal Excessive Fines Clause issue. This course will permit a number of less intrusive, and possibly more appropriate, resolutions by the state legislature or courts, while any ultimate review of the question in this Court will gain the benefit of a well developed record and a reasoned opinion on the merits by the State Supreme Court. Pp. 76-80.

2. Mississippi’s penalty statute does not violate the Equal Protection Clause of the Fourteenth Amendment, since it is reasonably tailored to achieve the State’s legitimate objectives of discouraging frivolous appeals, compensating appellees for the intangible costs of litigation, and conserving judicial resources. The statute does not discriminate against a particular class of appellants in an arbitrary and irrational fashion, since it broadly applies to both plaintiffs and defendants, as well as to a variety of specified types of readily determined judgments, and since its limitation to appellants from such judgments represents a rational, if partial, attempt to deter frivolous appeals without the substantial judicial intervention that the inclusion of other types of claims would require. Moreover, the statute poses little danger of discouraging meritorious appeals along with insubstantial ones, since the 15% penalty operates only after a judgment has been affirmed without modification, and represents a relatively modest additional assessment. Lindsey v. Normet, 405 U.S. 56, distinguished. Although the State might have enacted a statute that more precisely served the intended goals, perfection is not required under the rational basis test. Pp. 80-85.

483 So.2d 254, affirmed.

MARSHALL, J., delivered the opinion of the Court, in which REHNQUIST, C.J., and BRENNAN, J., joined, in all but Part II of which WHITE, J, joined, in all but Part II and n. 1 of which O’CONNOR and SCALIA, JJ., joined, and in all but Part III of which BLACKMUN, J., joined. WHITE, J., filed a concurring opinion, in which SCALIA, J., joined, post, p. 85. O’CONNOR, J., filed an opinion concurring in part and concurring in the judgment, in which SCALIA, J., joined, post, p. 86. SCALIA, J., filed an opinion concurring in part and concurring in the judgment, post, p. 89. BLACKMUN, J., filed an opinion concurring in part and dissenting in part, post, p. 89. STEVENS and KENNEDY, JJ., took no part in the consideration or decision of the case.