Southern Pac. Co. v. Guthrie

186 F.2d 926
CourtCourt of Appeals for the Ninth Circuit
DecidedApril 9, 1951
Docket12164
StatusPublished
Cited by85 cases

This text of 186 F.2d 926 (Southern Pac. Co. v. Guthrie) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Southern Pac. Co. v. Guthrie, 186 F.2d 926 (9th Cir. 1951).

Opinions

POPE, Circuit Judge.

After our decision in Southern Pacific Company v. Guthrie, 9 Cir., 180 F.2d 295, we granted a rehearing limited to the questions “whether the damages are excessive, and if so, what the action of the court should be.” The argument upon rehearing was before the court sitting in bank.

The facts relating to the character and extent of Guthrie’s injuries, and his loss of prospective earnings, are stated in the former opinion. There the court attempted to arrive at a conclusion as to the limit of permissible award for the loss of expected earnings. It is apparent that this item of pecuniary loss is much more susceptible of calculation than those items of damages coming within the description of pain, suf[927]*927fering, inconvenience and disfigurement. In order properly to appraise the verdict, the court, in the earlier opinion, undertook to discover the maximum possible allowance for the loss of earnings, assuming that the balance of the total verdict must be charged to the non-pecuniary losses, pain, suffering, etc.

In attempting to evaluate the evidence as to the damage resulting from lost earnings we found ourselves compelled to deal with a record devoid of evidence as to the probable present worth of the lost earnings. Thus, there was no evidence such as the cost of an annuity which would be a substantial equivalent of the lost earnings. Hence the court was obliged, as we are now, to refer to matters which we may notice judicially, such as the probable rate of interest available from safe investments. It should be understood that none of the factors which are thus considered are absolute. The previous conclusions as to present worth of the prospective earnings, were necessarily arrived at by a consideration not only of Guthrie’s 'life expectancy but also of the earning power of money. There is of course no rule of law which determines the probable rate of interest obtainable upon investments in safe securities.

Both parties have pressed us with considerations which, they say, should alter these conclusions. Such are, whether expected gross earnings must be calculated without regard to probable tax deductions; whether we should assume an expectation of earning beyond the age of compulsory retirement enforced by this employer; and, whether we should assume that Guthrie is not totally disabled to earn money in the future. In the former opinion the court expressed the view that due regard for the principle of compensation required recognition that a plaintiff should not be in a better position financially than he would have been if he had continued to work and that, hence some consideration of tax deductions is proper; that the earning power of money should be calculated at not less-than 3 per cent;1 that there is no justification for speculating either that Guthrie would be able to earn money, or that his employment would have continued beyond age 70 had his injuries not occurred. It was thought that the evidence did not disclose a pecuniary loss in excess of the present worth, calculated at 3%, of $6000 a year for eleven years. Calculated exactly, this was $55,515.74. The members of the court agreed that the balance of the verdict amount, some $45,000, as an award for such items of damage as pain and suffering, inconvenience and disfigurement, was “too high”. They differed as to whether this court should direct a remittitur.

We are now persuaded that the figure $55,515.74 should be enlarged, somewhat, and in two respects. We previously assumed Guthrie a man “past 59”. Actually, he was two months less than 59, and therefore “past 58”. Our calculation of eleven-years’ earnings was somewhat less than it should have been, although the difference would extend to no more than two months” earnings. We also considered that calculation should be based on no more than $6000 a year, because of necessary tax deductions. We think the court’s view that the net take home pay, after taxes, would represent the actual loss, is correct; but we are now convinced that we cannot tell how much this would be. Under the tax law then in force, he could look forward to an additional exemption after age 65, and' because he was married, the split income-features of the law would give two additional exemptions when his wife reached' 65, -something about which we cannot tell. All we do know is that in 1946, his income tax on $5,165.92 was $724 less a “rebate’” of “around $200”.

In the nature of such a case there is bound to be some uncertainty, even as to-such pecuniary matters as future earnings.. What Guthrie’s ultimate earnings, net or [928]*928gross, would be, cannot be foretold. While it may be prophesied that during his lifetime income taxes will continue, there is not equal certainty as to their impact on him. In Chicago & N. W. Ry. Co. v. Curl, 8 Cir., 178 F.2d 497, 502, the court held it not prejudicial error to refuse evidence of the amount of income tax and other deductions, because of the inherent uncertainty in such matters, saying, “We may assume that the jury were aware of * * * the fact that the average earnings, net or gross, of the appellee for the future could not be definitely known”.

As was said in the former opinion, if no account were taken of an income tax deduction, the present worth of Guthrie’s lost earnings for eleven years would amount, under the method of calculation employed by the court, to $63,778.33. Because of the uncertainties mentioned, it can be said that the maximum present worth shown was somewhere between that figure, and the $55,515.74 previously mentioned. Under the circumstances, we cannot assume that the trial court was wrong in stating that the figure exceeded $60,000.

It thus appears that the jury must be held to have awarded some $40,000 for the non-pecuniary damages. With respect to that award the members of this court as now constituted are in agreement, as was the court on the former hearing, on two preliminary conclusions.

The first of these is that the verdict was too high.

The second is that there is no basis for any claim that the verdict was given under the influence of passion or prejudice. The record contains no proof of any appeals to passion and prejudice, which, under some authorities, would be essential before such a conclusion could be reached. Larsen v. Chicago & N. W. R. Co., 7 Cir., 171 F.2d 841, 845. And even if an imputation of passion and prejudice could arise from the mere size of a verdict, this one does not fall into any such category.

We are now confronted with two arguments with respect to our power and duty in these circumstances. On behalf of Guthrie it is argued that since showing of passion or prejudice is absent, even although we consider the verdict too high, regardless of what may be the rule in the state courts, we, as a federal appellate court, are without power to require a new trial even if we find the verdict excessive; and since we cannot direct a new trial, we cannot condition a denial of a new trial upon a remittitur. And, notwithstanding this court did just that in Cobb v. Lepisto, 9 Cir., 6 F.2d 128, an impressive list of cases is cited by appellee in support of his position. Among these cases is Scott v. Baltimore & O. R. Co., 3 Cir., 151 F.2d 61, at page 64, where the court said: “The members of the Court think the verdict is too high. But they also feel very clear that there is nothing the Court can do about it.

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Bluebook (online)
186 F.2d 926, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southern-pac-co-v-guthrie-ca9-1951.