Marilyn W. Pearson, as Administratrix of the Goods, Chattels, and Credits of John S. Pearson, Deceased v. Northeast Airlines, Inc.

307 F.2d 131

• Court: Court of Appeals for the Second Circuit
• Decided: September 13, 1962
• Docket: 297, Docket 27350
• Status: Published

Opinions

SWAN, Circuit Judge.

This appeal involves litigation which resulted from the crash, on August 15, 1958, of appellant’s airplane on Nantucket Island. Mrs. Pearson as administra-trix of her deceased husband’s estate brought suit in the Southern District of New York, federal jurisdiction resting on diversity of citizenship, she being a citizen of New York and defendant a Massachusetts corporation. Her complaint alleged seven causes of action,¹ but there remains for consideration on the appeal only the cause of action based on the Massachusetts wrongful death act, which limits recovery to $15,000, and certain orders of the trial court denying defendant’s motions (a) to dismiss the complaint insofar as it sought damages for wrongful death in excess of $15,000, (b) for a directed verdict for plaintiff in the amount of $15,000, (c) for judgment non obstante veredicto in the limited amount of $15,000, and (d) for an order striking out that portion of the judgment which awarded plaintiff interest from the date of death, August 15, 1958, to the date of judgment, November 16, 1961, amounting to $26,106.88.

In denying defendant’s motions to limit recovery to the maximum permitted under the Massachusetts wrongful death act,² Judge McGohey ruled that he was obliged to apply a dictum of the New York Court of Appeals in Kilberg v. Northeast Airlines, Inc., 9 N.Y.2d 34, 211 N.Y.S.2d 133, 172 N.E.2d 526 to the effect that the Massachusetts limitation would not be enforced against a New York citizen suing in a New York court.³ He also ruled that the damages should be measured not by “the degree of culpability of defendant,” as required by the Massachusetts statute, but “by New York’s standard of the pecuniary damage resulting to the beneficiaries from the death.” Judge McGohey’s opinion is reported at 199 F.Supp. 539. Later, in denying defendant’s motion to strike prejudgment interest, he wrote a memorandum decision and order reported at D.C., 201 F.Supp. 45.

From these rulings of the trial court the defendant has appealed. It is not contended that in refusing to enforce the Massachusetts limitation of $15,000 Judge McGohey misconstrued the Kil-berg dictum. It is contended that such ruling violates the full faith and credit clause and the due process clause of the United States Constitution. With respect to the rulings on the measure of damages and on pre-judgment interest appellant contends that the trial court did misconstrue the New York law, or, if he correctly construed it, that the New York law is similarly unconstitutional. For reversal of the ruling as to pre-judgment interest reliance is also placed on a decision of the Appellate Division, First Department, made subsequent to Judge McGohey’s decision of December 15, 1961.

3a

Appellant devotes some ten pages of its brief to criticism of the Kilberg dictum in the endeavor to show that it “represents not only an ill-advised excursion into the field of advisory opinions, but a misconception (at least) of the earlier New York law and bad law in itself,” and notes that three judges of the Court of Appeals stated in vigorous terms that the majority had no “warrant or justification” for going beyond the issue decided. We think it inappropriate for this court to discuss the wisdom or the soundness of the majority’s dictum, and there is no necessity of our doing so. Consequently we pass at once to a discussion of the appeal.

Since federal jurisdiction rests on diversity, it is clear that Judge McGohey was obliged to apply the law of the State of New York, Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, including its conflict of laws doctrine, Klaxton Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477, unless some provision of the Constitution of the United States precludes its application. On the main issue, limitation of liability, appellant contends that application of the dictum violates the full faith and credit clause, while appellee contends that this provision does not preclude a State from applying its own conflict of laws rule.

A majority of the court holds, Judge Kaufman dissenting, that the trial court’s refusal to apply the $15,000 limitation of the Massachusetts statute violates the Full Faith and Credit Clause of the Constitution. (Art. IV, section l.)⁴ In denying the motion to strike out pre-judgment interest, we are all agreed that the trial court erred.

The purpose of the full faith and credit clause of the Constitution, as briefly explained in Sherrer v. Sherrer, 334 U.S. 343, 355, 68 S.Ct. 1087, 1097, 92 L.Ed. 1429, was to transform an aggregate of independent sovereign states into a nation. “If in its application local policy must at times be required to give way, ‘such is part of the price of our federal system.’ * * * ” [citation omitted]. To like effect is Estin v. Estin, 334 U.S. 541, 545-546, 68 S.Ct. 1213, 92 L.Ed. 1561. Neither of these cases was an action for wrongful death. The conflict between a foreign wrongful death action and a statute of the forum has been considered by the Supreme Court in three cases: Hughes v. Fetter, 341 U.S. 609, 71 S.Ct. 980, 95 L.Ed. 1212; First National Bank of Chicago v. United Air Lines, 342 U.S. 396, 72 S.Ct. 421, 96 L.Ed. 441; Wells v. Simonds Abrasive Co., 345 U.S. 514, 73 S.Ct. 856, 97 L.Ed. 1211. Appellant relies upon the first two; ap-pellee upon the last.

In Hughes the highest court of Wisconsin affirmed the dismissal of an action brought under the wrongful death statute of Illinois on the ground that a Wisconsin statute had been construed by its courts as establishing a local public policy against entertaining suits brought under wrongful death statutes of other States. This was reversed by the Supreme Court as a violation of the full faith and credit clause, Mr. Justice Black, who wrote the majority opinion, stating at pages 611-612 of 341 U.S., at page 982 of 71 S.Ct.:

“ * * * We have recognized, however, that full faith and credit does not automatically compel a forum state to subordinate its own statutory policy to a conflicting public act of another state; rather, it is for this Court to choose in each case between the competing public policies involved. The clash of interests in cases of this type has usually been described as a conflict between the public policies of two or more states. The more basic conflict -involved in the present appeal, however, is as follows: On the one hand is the strong unifying principle embodied in the Full Faith and Credit Clause looking toward maximum enforcement in each state of the obligations created or recognized by the statutes of sister states; on the other hand is the policy of Wisconsin, as interpreted by its highest court, against permitting Wisconsin courts to entertain this wrongful death action.

“We hold that Wisconsin’s policy must give way. That state has no real feeling of antagonism against wrongful death suits in general. * * *»

As in Hughes, the present appeal involves the same “more basic conflict” —a conflict between “the strong unifying principle embodied in the Full Faith and Credit Clause” and the public policy of New York expressed in the Kilberg dictum. It is likewise true that New York has no antagonism to wrongful death actions in general. Its antagonism is only to the limitation of liability. Its own statute has no limitation but the opinion recognizes that plaintiff’s rights arise under the Massachusetts statute, not the New York statute.⁵ The Supreme Court is the final authority to choose “between the competing public policies involved.” But on the present appeal this court must make the choice. This court believes that the “strong, unifying principle” of the full faith and credit clause should prevail.

In the First National Bank case the suit was brought in a federal district court in Illinois, on grounds of diversity of citizenship, to recover under the Utah wrongful death statute for a death which occurred in Utah. As required by an Illinois statute, the trial court dismissed the suit, and the Court of Appeals affirmed, 7 Cir., 190 F.2d 493. But the Supreme Court held the statute invalid under the full faith and credit clause of the Constitution. In a concurring opinion Mr. Justice Jackson wrote at page 400 of 342 U.S., at page 423 of 72 S.Ct.:

“For the essence of the Full Faith and Credit Clause is that certain transactions, wherever in the United States they may be litigated, shall have the same legal consequences as they would have in the place where they occurred. [Citations omitted.]

“There is undoubtedly some area of freedom for state conflicts law outside the requirements of the Full Faith and Credit Clause. In such matters, unreached by constitutional law, the state rule would prevail in a diversity court. Klaxon Co. v. Stentor [Electric Mfg.] Co., 313 U.S. 487 [61 S.Ct. 1020, 85 L.Ed. 1477]. But if a transaction is so associated with one jurisdiction that the Constitution compels any forum in which the transaction is litigated to apply the law of that jurisdiction, is it not the Constitution instead of state conflicts law which determines what law the federal court shall apply?”

That the answer to this question should be “yes” is the belief of a majority of this court.

In Wells v. Simonds Abrasive Co., 345 U.S. 514, 73 S.Ct. 856, 97 L.Ed. 1211, plaintiff’s decedent was killed in Alabama by a bursting emery wheel alleged to have been defective. The Alabama wrongful death act contained a “built in” two-year statute of limitations. Within two years, but more than one year, after decedent’s death, plaintiff sued the manufacturer of the emery wheel in a federal court in Pennsylvania, jurisdiction resting on diverse citizenship. The Pennsylvania statute of limitations was one year, and the issue was whether the court was compelled to give full faith and credit to the two-year limitation of Alabama. The Supreme Court held it was not. Mr. Chief Justice Vinson’s opinion distinguished Hughes and First National Bank on the ground that in those cases “the forum laid an uneven hand on causes of action arising within and without the forum state” whereas “Here Pennsylvania applies her one-year limitation to all wrongful death actions wherever they may arise.” The opinion explains that the court “long ago” had held that applying the statute of limitations of the forum to a foreign substantive right did not deny full faith and credit, and states that that clause “does not compel a state to adopt any particular set of rules of conflict of laws; it merely sets certain minimum requirements which each state must observe when asked to apply the law of a sister state.” ⁶

The appellant argues that the “minimum requirements” which New York must observe demand enforcement of the Massachusetts limitation, because, as stated by Mr. Justice Holmes in Slater v. Mexican National R. Co., 194 U.S. 120, 126, 24 S.Ct. 581, 48 L.Ed. 900: “It seems to us unjust to allow a plaintiff to come here absolutely depending on the foreign law for the foundation of his case, and yet to deny to the defendant the benefit of whatever limitations on his liability that law would impose.” In Davis v. Mills, 194 U.S. 451, at 454, 24 S.Ct. 692, at 693, the same Justice said: “* * * But, as the source of the obligation is the foreign law, the defendant, generally speaking, is entitled to the benefit of whatever conditions and limitations the foreign law creates.”

Appellant argues further that there is an obvious distinction between the Wells case and the case at bar. In Wells the plaintiff was not deprived of all remedy ; he could sue in any state where defendant could be found and which has a longer statute of limitations than Pennsylvania or follows a different conflicts rule. In our case defendant had no choice as to the forum. If deprived of the protection of the limitation imposed by the law which, as Kilberg recognizes, created the liability, he will be treated unjustly.

A defendant is in a different position from a plaintiff who seeks to enforce a cause of action conferred by the laws of another state, as Mr. Justice Brandéis pointed out in Bradford Electric Light Co. v. Clapper, 286 U.S. 145, 160, 52 S.Ct. 571, 76 L.Ed. 1026:

“ * * * A State may, on occasion, decline to enforce a foreign cause of action. In so doing, it merely denies a remedy, leaving unimpaired the plaintiff’s substantive right, so that he is free to enforce it elsewhere. But to refuse to give effect to a substantive defense under the applicable law of another State, as under the circumstances here presented, subjects the defendant to irremediable liability. This may not be done.” [Citations omitted.]

The Clapper case involved the workmen’s compensation laws of Vermont and New Hampshire. Appellant concedes that the decision has been diluted by subsequent cases dealing with workmen’s compensation but argues persuasively that nothing in the later cases gives support to the proposition that full faith and credit must give way to a local policy not embodied in a statute which directly governs the cause of action.⁷ As previously noted, Kilberg “still requires plaintiff to sue on the Massachusetts statute”; it does not claim extra-territorial effect for the New York wrongful death act. In our opinion the workmen’s compensation decisions are distinguishable from the case at bar.

So also are decisions involving the federal Tort Claims Act. Richards v. United States, 369 U.S. 1, 82 S.Ct. 585, 7 L.Ed. 2d 492, cited by appellee as favorable to it, is favorable to appellant, if it has any relevance. No constitutional question was there presented; Missouri was the place of the death, and Oklahoma the place of the negligence. Missouri, like Massachusetts, had a $15,000 limitation on wrongful death damages, and Oklahoma, like New York, had a constitutional limitation against such limitation. The final result of the litigation was to apply the Missouri statute, where the death occurred. See Richards v. United States, 10 Cir., 285 F.2d 521, which the Supreme Court affirmed.

There is no decision by the Supreme Court that the failure to enforce the limitation of a foreign wrongful death act is consistent with the full faith and credit clause of the Constitution. A majority of this court holds it is not. Consequently it is unnecessary to consider appellant’s other contentions, except the ruling as to pre-judgment interest.

The Kilberg dictum did not mention the subject of interest. Judge Mc-Gohey directed that pre-judgment interest be added because he thought it likely that if the question had been considered, the New York court would have ruled in accordance with the policy expressed in section 132 of the Decedent Estate Law. A few days subsequent to denial of the motion to strike out such interest, Davenport v. Webb, 15 App.Div.2d 42, 222 N.Y.S.2d 566 was decided.⁸ This decision was affirmed by the Court of Appeals in 11 N.Y.2d 392, 230 N.Y.S.2d 17, 183 N.E.2d 902. It will suffice to quote from that opinion the following:

“In New York, the prejudgment interest in a wrongful death action is ‘part of the damages’ (Cleghorn v. The Ocean Accident & Guarantee Corp., Ltd., 244 N.Y. 166, 167, 155 N.E. 87), the addition of which is governed by recourse to the usual conflicts of law rules, which we have consistently applied by not adding interest to the judgment unless lex loci delictus authorizes such an addition.” [Citations omitted.]

The Massachusetts statute provides for the addition of interest from the date of the writ. Chapter 229, section 11.

The judgment is reversed and the cause remanded for entry of judgment in conformity with this opinion.

1 . Four of the original causes of action were dismissed by Judge Weinfeld in a memorandum decision published at D.G., 180 F.Supp. 97. Another based on decedent’s pain and suffering prior to death, was dismissed at the close of the trial for lack of proof. The seventh count was for loss of personal property of the decedent. As to this, the court, on defendant’s motion, directed a verdict for $100, and plaintiff has not appealed.

Mrs. Pearson also filed a libel in admiralty which was dismissed for lack of jurisdiction at D.C., 199 F.Supp. 538.

2 . Chapter 229, section 2, Massachusetts General Laws:

“§ 2. Damages for death by negligence of common carrier. If the proprietor of a common carrier of passengers * * * causes the death of a passenger, he or it shall be liable in damages in the sum of not less than two thousand nor more than fifteen thousand dollar-s, to be assessed with reference to the degree of culpability of the defendant or of his or its servants or agents, and recovered and distributed as provided in section one, and to the use of the persons and in the proportions, therein specified.”

3 . Jack Kilberg sued as administrator of the estate of Edward J. Kilberg, a passenger on the plane who was killed in the same crash as Mrs. Pearson’s husband. The opinion states:

“ * * * Eor our courts to be limited by this damage ceiling (at least as to our own domiciliaries) is so completely contrary to our public policy that we should refuse to apply that part of the Massachusetts law. * * *

* s * & *

“We will still require plaintiff to sue on the Massachusetts statute but we refuse on public policy grounds to enforce one of its provisions as to damages.

* * * * *

“As to whether the measure of damages should be treated as a procedural or a substantive matter in wrongful death cases, there is authority both ways * *. It is open to us, therefore, particularly in view of our own strong public policy as to death action damages, to treat the measure of damages in this case as being a procedural or remedial question controlled by our own State policies.

* * * *

“Erom all of this it follows that while plaintiff’s second or contract cause of action is demurrable, his first count declaring under the Massachusetts wrongful death action is not only sustainable but can be enforced, if the proof so justifies, without regard to the $15,000 limit.”

Northeast’s brief in this court states that Mrs. Kilberg did not amend her complaint but accepted less than $15,000 in settlement, and discontinued her action.

. Davenport v. Webb, 15 A.D.2d 42, 222 N.Y.S.2d 566. This decision was affirmed on June 12, 1962, 11 N.Y.2d 392, 230 N.Y.S.2d 17, 183 N.E.2d 902.

4 . “Section 1. Full Faith and Credit shall be given in each State to the public Acts, Records, and Judicial Proceedings of every other State. And the Congress may by general Daws prescribe the Manner in which such Acts, Records and Proceedings shall be proved, and the Effect thereof.” (See also the implementing statute, 28 U.S.C.A. § 1738.)

5 . See note 3, supra; also the Court of Appeals discussion of Kilberg in Davenport v. Webb, 11 N.Y.2d 392, 230 N.Y.S.2d 17, 183 N.E.2d 902.

6 . Cf. dissenting opinion of Mr. Justice Jackson in which Mr. Justice Black and Mr. Justice Minton joined. 345 U.S. 519, 73 S.Ct. 856, 97 L.Ed. 1211.

7 . For example, in Alaska Packers Association v. Industrial Accident Commission, 294 U.S. 532, at 541, 55 S.Ct. 518, at 521, 79 L.Ed. 1044, it was pointed out tliat “while similar power to control the legal consequences of a tortious act committed elsewhere has been denied, * * * the liability under workmen’s compensation acts is not for a tort. * * * ’’ See also Pacific Employers Ins. Co. v. Industrial Accident Commission, 306 U.S. 493, 499, 59 S.Ct. 629, 83 L.Ed. 940; Carroll v. Lanza, 349 U.S. 408, 413-414, 75 S.Ct. 804, 99 L.Ed. 1183.

8 . This court came to the same conclusion as to the effect of the Kilberg dictum. St. Clair v. Eastern Air Lines, Inc., 2 Cir., 302 F.2d 477 (April 24, 1962).