Report to the Congress from the Presidential Commission on Catastrophic Nuclear Accidents

APPENDIX D
Latent Illness Claims Under Present Law

The Act directs the federal district court having jurisdiction over a nuclear incident, including an ENO, to look to the law of the state in which the incident occurred for its substantive rules of decision (Subsections 11 [hh] and 170[n][2]). These rules of decision would include the substantive rules of tort law regarding (a) whether a legally cognizable injury has occurred, (b) causation in fact by the instrumentality, and (c) the nature and amount of damages. To illustrate, as to legally cognizable injury, a claimant may be able to recover under the law of some states (but not the majority of states) for emotional distress in the absence of any demonstrable physical injury. The measure and scope of damages may also vary. The Act, with one exception not pertinent here,1 derives from state law the substantive law on each of these central aspects of claims.

The questions of what should be considered legally cognizable injuries and the scope of damages are considered in the body of the Commission's Report. The subject of whether any injury has occurred is touched on in this section, in the case of present claims for emotional distress and for increased risk of incurring future disease, while problems of proof of causation are considered in this section at some length.

The issue of causation, it might be noted, is likely to be much more easily resolved in the case of immediate damages in the aftermath of a nuclear incident than in the case of latent illness claims. Evacuation costs, reasonable medical diagnostic measures, lost wages of nearby workers, property damages, and certain other kinds of economic loss can and should be resolved without extensive litigation over the issue of causation. Under the present system, latent illness claims are less likely to be resolved without dispute for the very reason that cancers that could be radiogenic also have other causes, and the precise cause cannot be isolated in a given case. Settlements are less likely when causation is so uncertain and also because there are no accepted alternative institutions for dispute resolution (as in the case, for example, of the voluntary system developed between BNFL and UKAEA on the one hand and their respective unions on the other, discussed later).

I.   Statutes of Limitations

Latent illness claims, where the latency period is potentially measured in decades, would have been barred by the traditional (mid-20th Century) statute of limitations on bringing tort claims if, as was typically the case, it was about 2 to 6 years from the event giving rise to the claim. A majority of states now have statutes of limitations that are measured from the time the illness is discovered and knowledge of the alleged source is obtained. Thus, since the applicable statute of limitations is derived from state law for claims for a nuclear incident that is not an ENO, in most states, a discovery-type statute will apply. In the case of ENOs, under the 1988 amendments, a minimum 3-year discovery rule will apply.2 Accordingly, this problem may be considered resolved.

II.   Proof of Causation

The academic literature is replete with competing theories and criticisms of theories regarding the societal and economic underpinnings of liability in tort in general and, in particular, the requirement that plaintiffs establish causation in fact in various product and environmental liability mass tort scenarios. Rather than becoming bogged down in a theoretical exercise, the problem will be addressed at the practical level evidently intended by Congress compensation of legitimate claims. Assume that John Smith is a resident of a community not far from a nuclear power plant. A severe accident occurs at the plant, and best estimates are that Mr. Smith may have been exposed to several rads, at any rate levels not associated with any prompt health effects but still well in excess of 10 CFR Part 20 normal operating limits on exposures to the offsite public. He is duly examined by competent physicians, bioassays are performed, and he shows no early symptoms of radiation exposure.

Many years later, Mr. Smith develops a kind of cancer that could have been caused by radiation exposure, but also, and with some frequency, appears “spontaneously” (that is, absent significant exposure to ionizing radiation other than natural background and medical and dental X rays). If, after discovering his illness, Mr. Smith makes a timely claim against the licensee, he faces the problem, under the traditional common law view of causation, of establishing by a preponderance of the evidence that his illness was caused by the radiation exposure at the time of the accident. To make a prima facie case, he (still under the traditional view) would have to produce expert medical testimony opining, “to a reasonable medical certainty,” that his disease was so caused.3 It is not sufficient, under the traditional view, that the expert opinion be that the chances of cancer induction by radiation exposure are greater than 50-50.4 The defendant and its insurers may well face the problem, at this level of exposure, that their experts, reflecting the prevailing scientific view, advise that it is very probable that the exposure did not cause the cancer but will admit to the possibility, however slight, that it did. In a jury trial, depending on the judge's instructions to the jury, it is possible (if the question is allowed to go to the jury) that the jury will find for Mr. Smith, despite the fact that the prevailing scientific view is very strongly against causation in the particular case. In a bench trial, it is possible that a judge would find plaintiff's experts credible and defendant's experts not so, regardless that the latter presented conclusions consistent with the consensus of informed scientific opinion. There could be a great many “Smiths” (i.e., persons who were exposed to radiation and develop a type of cancer that can be caused by such exposure), many more than the estimated excess cancers in the affected population.

Conversely, it is possible that while several excess cancers are predicted, fewer or none are compensated because of the difficulties of proving causation under the traditional rules. Considerations of fairness arising from this possibility are among the factors that underlie proposals for proportionate liability, discussed later.5

III.   When to Pay

To Mr. Smith in the previous example, suppose that, shortly after his radiation exposure, he becomes aware that his risk of some forms of cancer may have increased as a result. He becomes quite concerned and emotionally distressed by this prospect. If applicable law from which the rules of decision are derived recognizes as actionable and compensable (a) emotional distress because of the fear that he may develop cancer, or (b) the increased risk that he will develop cancer, Mr. Smith may be able to obtain a trial on the merits and an award.6 Further, Mr. Smith may seek to obtain additional recovery at such time, if ever, as he actually develops a cancer that could have been caused by radiation exposure during the nuclear incident, in addition to the compensation already received. While this may be appropriate in the case of an earlier recovery for emotional distress, it would seem inappropriate for increased risk claims where the measure of damages was full “future” damages times a risk factor. That is, it would seem to be logically inconsistent to pay again when the risk materializes.

IV.   When to Assemble Funds; Competition Between Present and Future (Latent) Claims

The next question is whether the court should estimate the amount required to compensate latent illnesses and require that amount to be pre-funded, or whether it should simply satisfy itself that the funds could be raised when needed. (This question arises not because of concerns with the future solvency of insurers, because the primary layer of insurance would almost certainly have been exhausted in any major accident, but is intended to focus instead on the degree of assurance that latent injury claims will be paid as they arise, given whatever uncertainty there may be about the future solvency of licensees who remain liable for retrospective premiums or the obligation of Congress to appropriate funds for indemnity or to fulfill approved Presidential compensation plans.)

An intermediate course would be to establish a registry of potential latent illness claimants, take and preserve blood samples (of at least those who were in areas of some risk) for later dose reconstruction, provide eligibility criteria for long-term medical monitoring funded by the proceeds of nuclear liability insurance (see Appendix H), perhaps offer settlements to those who develop diseases that have some significant causal association with the exposure, and keep an eye on the financial capabilities of those who are liable for future payments.

An alternative approach that has a certain theoretical appeal, but many practical problems, would be to offer potential claimants who met defined-eligibility criteria the choice between (a) a fixed amount “now”, calculated to yield a fixed “cancer insurance” benefit in the future, discounted by present-worthing and the ratio of the increased risk to the total risk, including the “background” risk of cancer, and (b) full recovery in the future to those who can establish causation by a preponderance of the evidence. While such an approach would lead to early resolution (and preclusion of future claims), the proportionate early recovery would be quite small under such an approach and would appear to be socially useful only if the benefit were an insurance policy rather than a cash payment.

The court may have discretion to choose between collecting funds and setting them aside and simply allocating (“earmarking”) possible future collections. Pre-funding is more secure and may be said to minimize intergenerational inequities for the customers of those who would pay retrospective premiums. That is, those who benefitted from the nuclear power generated in the same general time frame of the accident would pay for the liability insurance costs associated with the electricity they used, not their children and grandchildren.

The issue here may be viewed, as Congress did in 1966 and 1975, as one of the potential for competition between current claims and possible future latent illness claims.7 Assume a scenario where current claims will likely use up all of the insurance (primary and secondary) the system can produce. Should the Congress be asked to do anything at that time? Should the court reserve some of the insurance proceeds (whether collected or not) for future latent claims, and should the President ask the Congress for more money for present ones? Or should Congress be asked to provide at once some funds to be set aside and accumulate earnings to pay future claims for latent Illnesses? Or should (or would) the matter be postponed until latent claims start appearing?

It will be observed that the sections of the Act that deal with latent injuries (see Appendix C) are premised on a situation in which public liability may exceed the applicable liability limit. Under the law as it existed prior to the 1988 amendments, it was possible that claims would be pro-rated. The concern, then, was whether and how to prorate current claims payments in such a situation so as to leave sufficient funds to compensate for latent illnesses if and when they occur. This presumably would have involved estimating the latent illnesses and the time of their manifestation, and the value of the associated claims in future dollars. The question would have remained whether to collect and set aside the dollars expected to be needed (in which event the amount required could be valued using a present-worth methodology), or instead rely on the solvency of licensees obligated for retrospective premiums (or on action by a future Congress in the case of indemnity or where present claims have used up all available insurance) to fund claim payments as they mature. Under the 1988 amendments, however, it would appear that there may be a tendency to pay out whatever current claims merit, without regard to future claims for latent illnesses, because the Congress is committed to fun compensation and can provide it as needs arise if insurance funds have been exhausted (Subsection 170[e][2]).

V.   Current Treatment in U.S. Courts

Proof of causation, as explained above, is the principal problem that parties and courts have to grapple with in bringing, defending, and deciding latent illness claims where the illness is alleged to have been induced as a result of radiation exposure from a nuclear incident. What it comes down to is a battle of the experts. Given the complexity of the subject matter and the diversity of opinions being presented to courts today, some have questioned whether lay judges and juries are capable of fairly and consistently resolving disputes that involve contradictory expert opinions on dose or causation or both. While claims for cancer induction by radiation exposure may not be unique in this respect (similar problems arise in other toxic tort contexts), the problem is, nonetheless, a real one if the goal is to make use of the best of man's knowledge on a particular subject. The traditional view regarding proof of causation is (again) that, in order to prevail, the plaintiff must show that it is more likely than not that the toxic agent in question caused the particular disease.8 The present posture of Price-Anderson, because it allows state law to govern the causation issue, is to allow the law in this respect to evolve as it will, with the jurisprudence of each of the several states (from which rules of decision not governed by the waivers of defenses would be derived) free to insist on traditional proof, or to tilt the system toward recovery even when traditional standards are not met.

Some courts have dealt with the causation problem simply by allowing plaintiffs' experts broad latitude, both in regard to whether they are indeed experts qualified to give opinion evidence on the particular matter at hand and whether their conclusions were arrived at using the appropriate methods and standards of the discipline involved (in terms, for example, of the confidence level of any statistical data relied upon).9

The central causation issue is what degree of confidence do the experts need to assign to causation in order to satisfy the burden of going forward and the burden of proof? Some courts have indicated that the statistical measures that would be accepted in scientific circles should be required in law, that is, opinion as to causation should not be accepted unless it is statistically valid to the 95 percent confidence level.10 The difficulty that some have with this concept is that it creates the antipodal problem to compensating everyone: fewer will be compensated than are estimated to have been harmed Although it may be true that estimates of harm are more or less linear upper bound estimates derived from higher doses and higher dose rates, and that they assume no effective biological repair mechanism such that it should not be surprising to find fewer actual cases than the estimated upper bound, this scientifically satisfying answer has not been well-received at a popular or political level.

Thus, when presented with a class that was exposed to some radiation and has suffered significant (in a statistical sense or not) levels of ill effects compared to the population as a whole, courts tend to search for a way to compensate at least some members of the class.11 For example, the class could be divided into subclasses by disease, and among those having a disease or diseases that have the strongest association with radiation exposure, compensate each class member (or perhaps only those that were so positioned as to receive the greatest exposure, or perhaps in proportion to estimated exposure).

The approach of reversing burdens of proof has also been proposed, but so far has not been followed to any great extent.12 This approach tends, of course, to compensate more people, and relieves plaintiffs of a heavy burden, but it does nothing in a “search for truth” sense, since for defendants to prove noncausation or alternate causation, which amounts to proving a negative, is also a heavy burden.13 The theory behind this approach is that defendants are in a better position to prevent exposure, to create and preserve records from which doses can be reconstructed, and have the resources to locate witnesses and absorb losses in doubtful cases and spread risk in valid ones.

Another approach is to use special masters, court-appointed experts, science panels, or external standards either to inform and guide the factfinder or actually to control the decision on individual causation, all as discussed in other sections of this Report.


Footnotes

  1. One of the amendments enacted in 1988 precludes the award of punitive damages out of government indemnity. See Atomic Energy Act of 1954, as Amended [hereinafter Act] § 170(s).

  2. Act § 170(n)(1). Since the federal law operates as a waiver of, and not a substitute for, state law. any applicable longer state discovery period would apply.

  3. See, e.g., Johnston v. U.S., 597 F. Supp. 374, 412 (D. Kansas, 1984).

  4. Ibid.

  5. Similar considerations may motivate some experts to stretch a point in converting possible causation to probable causation, a phenomenon that might be less common in a proportionate liability regime.

  6. Conversely, the law of most states, which would be drawn upon under the choice-of-law provisions of Price-Anderson. probably would not recognize a claim based on increased risk but would require Mr. Smith to wait until a disease is manifest.

  7. The implied clear line between present and future claims is not necessarily what will occur because there will likely be some current claims for increased risk of disease.

  8. Part of that overall preponderance of the evidence showing is, again. traditionally, expert opinion evidence on causation “to a reasonable medical certainty.”

  9. Ferebee v. Chevron Chemical Corp. 736 F2d 1529 (D.C. Cir. 1984) is an example of a case in which an appellate court concluded that it was permissible to let a case go to the jury even without epidemiological evidence or other clear evidence of toxicity such as animal studies. Compare the case cited infra, n. 10.

  10. See, e.g., Koller v. Richardson-Merrel Inc., D.C.D.C., C.A. No. 80-1258. 11 Product Safety & Liability Reporter (BWA) at 186 (mem. op. Feb. 15,1983).

  11. See, for example, the Allen case infra, n. 12. “Clusters” of disease give rise to a stronger inference of causal relationship among lay persons than among those who work with epidemiological or other statistical data. Statistically. they are comparable to the same person winning a state lottery twice. (New York Tunes, February 27,1990, p.C-1). Such “clusters” can and do occur in the absence of a discernible toxic agent. or indeed any known agent. (In this connection. recent studies in Britain have found elevated rates of leukemias in the area surrounding proposed nuclear plants that were never constructed. Nucleonics Week. Feb. 1, 1990, p. 7.) Of course, establishing that a cluster was not necessarily caused by a toxic agent when such an agent was, in fact, present is not the same as ruling out that agent as the cause or a potential cause.

  12. However, in Allen v. U. S., 588 F. Supp. 247 (D. Utah 1984), rev'd on other grounds, 816 F. 2d 1417 (10th Cit. 1987). cert. den. 484 U.S. 1004 (1988), the district court did reverse the burden of proof once it was established that radiation exposure was a substantial factor in induction of certain plaintiffs' diseases. This burden-shifting should not be taken out of context, which included findings that warnings, monitoring, and protective measures for the public compared unfavorably to those for government and contractor personnel.

  13. The ancient common law rule was that losses remained where they fell unless the defendant breached a duty owed to plaintiff. The standard to which defendants are held has evolved to ever-more-stringent levels, from negligence to, in some cases, strict liability (liability without fault) and sometimes even to absolute liability (the liability of a first-party insurer). The traditional burden of proof on plaintiffs to establish causation is a product of this tradition, and is seen by many as essential to a system that seeks to do justice rather than merely redistribute wealth.


Appendix C « Index » Appendix E