Klippel v. U-Haul Co. of Northeastern Michigan

• Decision Date: 25 April 1985
• Docket Number: No. 84-1149,U-HAUL,84-1149
• Citation: 759 F.2d 1176
• Parties: Glenn P. KLIPPEL, Appellant, v.COMPANY OF NORTHEASTERN MICHIGAN, Appellee. In re Glenn P. KLIPPEL, v.COMPANY OF NORTHEASTERN MICHIGAN, and In re Glenn P. KLIPPEL, v.COMPANY, et al.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1176

759 F.2d 1176

Glenn P. KLIPPEL, Appellant, v. U-HAUL COMPANY OF NORTHEASTERN MICHIGAN, Appellee.

In re Glenn P. KLIPPEL, v. U-HAUL COMPANY OF NORTHEASTERN MICHIGAN, and In re Glenn P. KLIPPEL, v. U-HAUL COMPANY, et al.

No. 84-1149.

United States Court of Appeals Fourth Circuit.

Argued Oct. 5, 1984.

Decided April 25, 1985.

W. Bromley Hall, Greenlawn, N.Y. (Flanagan, Hall, Kelly, Ronan & Spollen, Greenlawn, N.Y., on brief), for appellant.

Richard B. Watson, Columbia, S.C. (Edward W. Mullins, Jr., Robert W. Foster, Jr., Nelson, Mullins, Grier & Scarborough, Columbia, S.C., on brief), for appellee.

Before WINTER, Chief Judge, SPROUSE, Circuit Judge and HAYNSWORTH, Senior Circuit Judge.

HAYNSWORTH, Senior Circuit Judge:

About five o'clock on a November afternoon a U-Haul truck was proceeding in the northbound lanes of Interstate 85 in Cherokee County, South Carolina. It passed a trucker who observed the driver of the U-Haul vehicle leaning against the steering wheel and the passenger slumped largely under the truck's dashboard. The trucker observed the U-Haul vehicle in front of him weaving from lane to lane. It moved to its right on to the paved shoulder and beyond to the grass. It then turned abruptly to its left, crossed the northbound lanes and the median and slammed into the side of a southbound truck. Both occupants of the U-Haul vehicle were thrown out. The thoroughly inebriated driver of the U-Haul vehicle was killed and the passenger, the plaintiff Klippel, seriously injured.

Klippel, who was a resident of New York, filed an action in New York against U-Haul claiming damages for the injuries he had sustained in South Carolina under the New York Vehicle and Traffic Law Sec. 388, the first paragraph of which provides:

Every owner of a vehicle used or operated in this state shall be liable and responsible for death or injuries to person or property resulting from negligence in the use or operation of such vehicle, in the business of such owner, or otherwise, by any person using or operating the same with the permission, express or implied, of such owner.

It also requires that every registered owner of a motor vehicle in New York provide liability insurance covering the risk of vicarious liability under Sec. 388. The plaintiff's contention is that, because he was a resident of New York, Sec. 388 was applicable to the U-Haul vehicle when he sustained his injuries in South Carolina and that U-Haul, by virtue of the New York statute, must compensate him for the injuries he sustained as a result of the negligence of the driver of the vehicle, who also was a resident of New York.

The U-Haul vehicle was registered in Michigan. It had been rented by the driver's sister in Florida for the purpose of transporting some of her personal belongings from Florida to Spartanburg, South Carolina where she had rented an apartment into which she intended to move.

The case was removed from a state trial court in New York to the United States District Court for the Southern District of New York, which transferred it to the United States District Court for the District of South Carolina under the provisions of 28 U.S.C.A. Sec. 1404(a). Upon the ground that the substantive law of South Carolina governed and that South Carolina law did not hold a non-negligent owner of a vehicle vicariously liable for the negligence of a permittee operator, the district court entered summary judgment for U-Haul.

We affirm, for we conclude that the New York Court of Appeals would resolve the choice of law question by holding that Sec. 388 had no application in the circumstances of this case and that U-Haul's substantive liability should be resolved under the law of South Carolina.

I.

The plaintiff, Klippel, and his friend, Petroccia, left New York City for a visit to Florida. They were hitch hikers. They arrived in Fort Lauderdale, Florida where they visited Petroccia's sister and Smith, the man with whom she lived. Smith and Petroccia's sister planned to move to Spartanburg, South Carolina, where they had rented an apartment. It was agreed that Klippel and Petroccia would drive a U-Haul truck loaded with the sister's belongings to her new apartment in Spartanburg, South Carolina. A few days later, the sister rented the U-Haul truck for a journey commencing in Fort Lauderdale and ending in Spartanburg. Sometime the next day, Petroccia and Klippel left Fort Lauderdale in the loaded vehicle. Twice they stopped for the night to visit other relatives, but in due time arrived in Spartanburg.

They moved the contents of the truck into the apartment to be occupied by Petroccia's sister and Smith. They then began to drink, or at least Petroccia did, for, after his death, his blood was found to have a very high alcohol content. The blood analysis also showed that he had used Quaaludes. In a deposition, the plaintiff denied that he had used either alcohol or any drug. He remembered being told by Petroccia that Petroccia had had a Quaalude, but the plaintiff remembered little else of the occurrences at the time, for he said that he had completely lost control of himself. In any event, for some inexplicable reason, in the late afternoon they were heading north in the then unloaded truck. Though the contract called for the surrender of the truck in Spartanburg the next day, the plaintiff suggests that they had resumed their return trip to New York in the rental truck. They did not get far, for Gaffney, South Carolina, the scene of the accident, is only approximately twenty miles from Spartanburg.

II.

Because this case was transferred from the Southern District of New York to the District of South Carolina, we must treat New York as the forum state and resolve the conflicts of laws question with which we are presented as it would be resolved in the New York Court of Appeals. See Van Dusen v. Barrack, 376 U.S. 612, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964). That court has been a leader in giving extra-territorial effect to New York law to avoid procedural and substantive limitations upon recoveries by New York plaintiffs injured, or whose decedents were killed, in other jurisdictions.

We may begin with Kilberg v. Northeast Air Lines, 9 N.Y.2d 34, 211 N.Y.S.2d 133, 172 N.E.2d 526 (1961). There a New Yorker had purchased an airline ticket in New York and boarded an airplane for a flight commencing in New York. The plane crashed in Massachusetts. Massachusetts had a statute which limited recoveries in wrongful death actions, while New York had a provision in its Constitution forbidding any such limitation of liability. The court regarded the site of the crash as fortuitous and adventitious. It might have been in a state other than the passenger's intended destination and over which he may have had no intention of even flying. In the context of modern travel by air, the court thought it outrageous that New Yorkers might be subjected to varying restrictive state laws when they had not chosen to subject themselves to the laws of those other jurisdictions and when New York's policy against statutory restrictions upon the amounts of recovery in wrongful death actions was so forcefully embodied in its Constitution.

The rule of Kilberg was extended in Miller v. Miller, 22 N.Y.2d 12, 290 N.Y.S.2d 734, 237 N.E.2d 877 (1968). In Miller, a New Yorker had been killed in Maine while riding in an automobile owned by his sister-in-law and driven by his brother, both of whom were residents of Maine. The New York Court of Appeals refused to apply Maine's statutory limitation upon the amount of damages recoverable in a wrongful death action brought in New York. A divided United States Court of Appeals for the Second Circuit reached a similar conclusion in Rosenthal v. Warren, 475 F.2d 438 (1973). In that case, the personal representative of a deceased New Yorker, by attachment upon the defendant's liability insurance contract, pressed a claim in New York for malpractice against a Boston physician who had operated upon and treated the New York decedent just before his death. The Massachusetts surgeon treated many New York patients, and the defendant hospital solicited funds in New York, but the essence of the holding seems to have been that New York's constitutional prohibition against limitations upon recoveries in wrongful death actions follows a New Yorker everywhere, provided he can get jurisdiction of an appropriate defendant in New York.

Meanwhile, after Kilberg, the New York Court of Appeals developed its "center of gravity," or "grouping of contacts," or "interest analysis" approach to the resolution of conflicts questions in tort cases.

The complete break with the past came with Babcock v. Jackson, 12 N.Y.2d 473, 240 N.Y.S.2d 743, 191 N.E.2d 279 (1963). In that case, New Yorkers traveled from New York into Ontario, from which they intended to return to New York. A New York passenger was injured in Ontario, allegedly as a result of the negligence of the New York driver. The defendant raised the defense of Ontario's "guest statute" which, in the circumstances of the case, would have denied all recovery to the plaintiff. The New York Court of Appeals held the defense unavailable, since New York had no such statute. Ontario's interest in the controversy was thought to be insubstantial since both plaintiff and defendant were New Yorkers. The excursion originated in New York and was intended to terminate there. It was thought that if the Ontario statute was applied, the result would be anomalous, and it does seem something of a happenstance that the wreck occurred in Ontario rather than in New York, in which case New York law indisputably would have controlled.

Initially the new rule was not applied to outlaw guest statute defenses in trips of substantial duration during which the New York residents had developed substantial contacts with the state in which the accident occurred. Dym v. Gordon, 16 N.Y.2d 120, 262 N.Y.S.2d 463, 209 N.E.2d 792 (1965), but...