Ageloff v. Delta Airlines Inc.
| Citation | 860 F.2d 379 |
| Decision Date | 18 November 1988 |
| Docket Number | No. 86-6022,86-6022 |
| Parties | Harold AGELOFF and Carol M. Ageloff, as Personal Representatives of the Estate of Scott Alan Ageloff, Deceased, Plaintiffs-Appellees, v. DELTA AIRLINES INC., Defendant-Appellant. |
| Court | United States Courts of Appeals. United States Court of Appeals (11th Circuit) |
Barwick & Dillian, P.A., Lyndall M. Lambert, Howard E. Barwick, Thomas E. Ice, Miami Shores, Fla., for defendant-appellant.
Robert M. Montgomery, Jr., Montgomery Searcy and Denney, Edna L. Caruso, West Palm Beach, Fla., for plaintiffs-appellees.
Appeal from the United States District Court for the Southern District of Florida.
Before VANCE and ANDERSON, Circuit Judges, and BROWN *, Senior Circuit Judge.
Scott Alan Ageloff was killed in the crash of Delta Airlines Flight 191 at the Dallas-Ft. Worth Regional Airport on August 2, 1985. In January 1986 Ageloff's parents--as personal representatives of his estate--brought this diversity wrongful death action against Delta Airlines. Delta conceded liability, and the case went to trial only for the determination of damages. Unlike the typical wrongful death case, damages sought by the parents are not the pecuniary loss sustained by their being deprived of contributions to them by their son. Rather it is a claim by his estate of the accumulations which the decedent would have generated had he continued to live. It comes about by Sec. 768.21 of the Florida Wrongful Death Act 1 and the statutory definition of "net accumulations." 2 Delta appeals, contending that the trial court erred by (i) permitting the calculation of Ageloff's projected annual saved net income by a method which contravenes the Express Exclusion 4 contained in Fla.Stat. Sec. 768.18(5), (ii) allowing an improperly speculative, multiple recovery 5 by admitting evidence concerning the effects of inflation upon the dollar amounts of Ageloff's expected future "net accumulations," (iii) declining to give Delta's requested instruction that any damage award would not be subject to federal income tax, and (iv) awarding as costs expert witness fees in excess of the $30 amount expressly authorized in 28 U.S.C. Sec. 1821(b). We certify the basic questions of law to the Supreme Court of Florida and defer decision on several subsidiary issues until receipt of its opinion.
The jury returned a verdict of $1 million in favor of Ageloff's 3 estate.
At the time of his death, Scott Ageloff was an unmarried twenty-nine year old Florida resident with no dependents and was employed by the Ageloff family-owned toy business, Harry's Kidsworld, Inc. (Kidsworld), in which he owned a 25% share. Ageloff's parents, as personal representatives of his estate, brought this diversity wrongful death action against Delta. Delta conceded liability for compensatory damages. The estate agreed to waive all other claims for damages, including any claim for punitive or exemplary damages. The case went to trial for the determination of damages only, under the Florida Wrongful Death Act, Fla.Stat. Secs. 768.16--768.27 (notes 1 and 2, supra ).
Before trial, Delta made a Motion in Limine to exclude all evidence relating to the value of Kidsworld and its subsidiaries. That motion was not opposed by the estate, and was granted. 6 At trial, Delta made a second Motion in Limine, to exclude--on the basis of Sec. 768.18(5) (n. 2, supra )--evidence of Ageloff's reinvestment into Kidsworld of a portion of his share of its profits. After an initial deferral, that motion was denied.
Two expert witnesses, Drs. Cunitz and Goffman, testified for the estate concerning the dollar value of the loss of net accumulations sustained by the estate and also submitted written reports of their respective Dr. Goffman began by postulating that in fiscal 1985 the amount of remuneration Ageloff earned (as opposed to the amount he actually received ) 9 as an officer of the business had been $40,000 (Table I, line 1, col. (b)). 10 He then estimated the annual Dr. Cunitz' calculations appear to have been performed in substantially the same manner as Dr. Goffman's. 17 Dr. Cunitz estimated (i) Ageloff's annual earnings from Kidsworld at the time of his death at $41,250 (line 1, col. (c)), 18 (ii) the annual nominal growth rate of Ageloff's annual earnings from Kidsworld at 11.5% (line 2 Both Goffman and Cunitz used a 6.5% rate of inflation over the remainder of Ageloff's life expectancy, 23 and discounted the prospective net accumulations to present Testifying for Delta, Dr. Mellish based his calculation of Ageloff's net accumulations on Ageloff's actual remuneration received from Kidsworld during the period from 1981 to 1985--i.e., Ageloff's income shown on his federal income tax returns. 25 Unlike Doctors Goffman and Cunitz he made no adjustment to reflect any difference between remuneration received and a greater amount earned. Dr. Mellish annualized the income figure for incomplete calendar year 1985, then accounted for inflation by adjusting all figures to 1986 dollars. Finally, he averaged those adjusted figures to yield an estimated 1986 income of $29,688 (Table I, line 1, col. (d)). He then "took into account probable future increases in [Ageloff's] income, in real terms." 26 Mellish did not specify what growth rate he applied to Ageloff's income in making his calculations. His testimony quoted here does indicate, however, that that growth rate did not include a component due to inflation. Dr. Mellish predicted that Ageloff's "net accumulation rate" would have been 25% over the remainder of his life expectancy. 27 Dr. Mellish testified that he The jury returned a verdict of $1 million in favor of the estate. In addition, the District Court awarded as costs witness fees 31 in excess of the $30 amount expressly authorized in 28 U.S.C. Sec. 1821(b). 32 Delta's motion for a new trial was denied.
calculations. 7 Dr. Mellish testified on the dollar value of the loss, as Delta's expert. 8 The essence of each expert's analysis is set forth in Table 1 for ease of reference, and then elaborated upon in the text
nominal growth rate of Ageloff's earnings at 10% (Table I, line 2, col. (b)). 11 That growth rate included components due to (i) inflation (line 2A) and (ii) increase in Ageloff's personal "productivity (line 2B)." 12 Dr. Goffman also predicted that Ageloff would have saved 25% (line 3, col. (b)) of his income and that he would have reinvested all of these savings into Kidsworld. 13 Based on his analysis of the company's earnings, Dr. Goffman calculated that these reinvested savings would yield an annual return of 12.5% (line 4, col. (b)). 14 Dr. Goffman also assumed that the return on reinvested savings is properly a part of "net accumulations" as defined in Fla.Stat. Sec. 768.18(5). 15 Starting from these assumptions, Dr. Goffman calculated that the prospective net accumulations of the estate, unreduced to present value, were $36,171,212 (line 5, col. (b)). 16
col. (c)), 19 (iii) Ageloff's savings rate at 10% for 1986 and increasing gradually and steadily thereafter to 25% for A.D. 2016 and thereafter (line 3, col. (c)), 20 and (iv) predicted that Ageloff would have left these savings in Kidsworld, receiving an annual return of 18% (line 4, col. (c)). 21 Dr. Cunitz also assumed that the return on reinvested savings is properly a part of "net accumulations" as defined in Sec. 768.18(5). Starting from these assumptions, Dr. Cunitz calculated that the prospective net accumulations of the estate, unreduced to present value, were $55,540,850 (line 5 col. (c)). 22
value using a discount rate of 7%. 24 The Goffman $36,171,212 thus reduced to present value becomes $1,842,794 (line 7, col. (b)), and the Cunitz $55,540,850 becomes $2,829,688 (Table I, line 7, col. (c))
next considered the possibility that Ageloff's earnings at Kidsworld might be greater than the remuneration he actually received, but concluded that any funds Ageloff earned but left in Kidsworld would yield a negative rate of return (i.e., would gradually be lost through unprofitable operations). 28 Starting from these assumptions, Dr. Mellish calculated the prospective net accumulations of the estate at Ageloff's expected retirement at age 65 in A.D. 2021, reduced to present value, as $305,026. Finally, Dr. Mellish predicted that Ageloff's cost-of-living consumption during the years between his projected retirement and the completion of his life expectancy, nine years later in AD 2030, then would have diminished his net accumulations. 29 The
present value of the net accumulations remaining at the completion of Ageloff's life expectancy would have been $279,878 (Table I, line 7, col. (d)). 30
Delta appeals, contending that the District Court erred by (i) permitting the augmentation of Ageloff's projected savings from his remuneration as an officer of Kidsworld 33 by the addition of projected income--for the balance of Ageloff's life expectancy--from the investments into which Ageloff hypothetically would have put those savings had he lived to the end of his life expectancy. The error, in Delta's view, is that such a course contravenes the language of Fla.Stat. Sec. 768.18(5), which expressly excludes "income from investments continuing beyond death" from the computation of net accumulations. Delta further contends (ii) that even if the course followed below did not contravene Sec. 768.18(5), then "[i]nterest income earned after the decedent's death ... on investments ... hypothetically made after the decedent's death" still "must clearly be excluded from calculations of the [estate's] lost net accumulations" because to do otherwise "provides [multiple] recovery for the [estate] and results in jury speculation and uncertainty in the law." Further, Delta contends that the District Court also erred by (iii) admitting evidence concerning the effects of inflation...
To continue reading
Request your trial
-
Blue Cross & Blue Shield of N.J. v. Philip Morris
..."exposure" element of liability), aff'd sub nom Hilao v. Estate of Marcos, 103 F.3d 767 (9th Cir. 1996); Ageloff v. Delta Airlines, Inc., 860 F.2d 379 (11th Cir.1988) (using evidence of life-expectancy tables to determine damages); G.M. Brod & Co., Inc. v. U.S. Home Corp., 759 F.2d 1526, 15......
-
Schwab v. Philip Morris USA, Inc.
...compensatory damages by extrapolation), aff'd sub nom Hilao v. Estate of Marcos, 103 F.3d 767 (9th Cir.1996); Ageloff v. Delta Airlines, Inc., 860 F.2d 379, 383-84 (11th Cir.1988) (in wrongful death suit by estate, evidence of decedent's life expectancy, in conjunction with projected earnin......
-
Transco Leasing Corp. v. U.S., 88-1823
...Culver II, and noted that the government had cited no Texas law rejecting the total offset approach. In Ageloff v. Delta Airlines Inc., 860 F.2d 379, 389 (11th Cir.1988), the Eleventh Circuit held that Culver II did not apply to damage recoveries in diversity We conclude that the district c......
-
Cimino v. Raymark Industries, Inc.
...(1972). Courts frequently permit evidence of life-expectancy or mortality tables when determining damages. See Ageloff v. Delta Airlines, Inc., 860 F.2d 379 (11th Cir.1988); Espana v. United States, 616 F.2d 41 (2nd Cir.1980); Larsen v. International Business Machines Corp., 87 F.R.D. 602 (......
-
Untangling taxes from personal injury damages.
...422, 425 (Fla. 1990); H & H Elec., Inc. v. Lopez, 967 So. 2d 345, 347 (Fla. 3d D.C.A. 2007). (7) See Ageloff v. Delta Airlines, Inc., 860 F.2d 379, 390 (11th Cir. 1988) (concluding that Florida law permits the instruction to be given, but does not require it; rather, it is left to the d......