Alaska Airlines, Inc. v. Sweat
| Decision Date | 22 July 1977 |
| Docket Number | Nos. 2912,3103,s. 2912 |
| Citation | 568 P.2d 916 |
| Parties | ALASKA AIRLINES, INC., Appellant, v. Milford Douglas SWEAT and Diane M. Sweat, Appellees. Milford Douglas SWEAT and Diane M. Sweat, Cross-Appellants, v. ALASKA AIRLINES, INC., an Alaska Corporation, and Chitina Air Service, Inc., an Alaska Corporation, Cross-Appellees. |
| Court | Alaska Supreme Court |
Sanford M. Gibbs, Charles W. Hagans, Hagans, Smith & Brown, Anchorage, for appellant and cross-appellees.
Kenneth D. Jensen, Jeffrey H. Roth, Jensen, Harris & Roth, Anchorage, for appellees and cross-appellants.
Before BOOCHEVER, C. J., RABINOWITZ, CONNOR and BURKE, JJ., and DIMOND, J. Pro Tem.
This appeal arises out of a judgment in favor of Milford Douglas Sweat against Alaska Airlines for injuries sustained in an airplane crash. Sweat was a passenger aboard a Chitina Air Service plane which encountered a "whiteout" and crashed on the Bering Glacier. Chitina is licensed as an air taxi by the State of Alaska, but at the time in question, was engaged under a contract with Alaska Airlines, Inc. in servicing a portion of Alaska Airlines' regularly scheduled route. The crash was attributed to pilot error. The parties have raised numerous and often multi-faceted issues. Alaska Airlines (Alaska) claims that:
1. As a matter of law, it cannot be held vicariously liable for Chitina's negligence.
2. The trial court was precluded from entering summary judgment since federal regulations pre-empt the subject of air carriers and substituted service.
3. Sweat's settlement with Chitina released Alaska Airlines.
4. Summary judgment on liability was improperly granted since the question of whether Sweat was a passenger of Chitina's as an air taxi or under its contract with Alaska Airlines presented an issue of fact.
5. The trial court erroneously admitted and considered a new federal regulation ER-946, without adequate notice to counsel, and this regulation introduced a factual issue involving Chitina's financial responsibility which was incapable of resolution by summary judgment.
6. Cross-examination of Sweat's expert witness on damages was improperly limited.
7. Witnesses of Alaska were improperly excluded.
8. Alaska was denied a fair and impartial trial.
9. Damages were improperly assessed in that:
(a) Future retirement benefits were awarded without reduction to present value.
(b) Lost future earnings should have been reduced to present value.
(c) An award for loss of health, welfare and legal benefits should not have been allowed.
Sweat has cross-appealed contending that the trial court erred in:
1. Limiting pre-trial loss of health, welfare and legal benefits to $1,000.00.
2. Limiting future loss of such benefits to $10,000.00.
3. Finding that Sweat's earning capacity on post-accident employment was $10.00 an hour with an increase to $12.00 an hour within five years.
4. Finding that Sweat could earn alternative retirement benefits in his new job valued at $50,000.00 and deducting this amount from his lost retirement benefits.
5. Awarding only $50,000.00 attorney's fees and not supporting the deviation from Civil Rule 82(a)'s schedule with specific reasons.
We affirm the trial court's award of summary judgment on liability but hold that there was error in limiting cross-examination of Sweat's expert witness and in various aspects of the award of damages. Additionally, the court should have set forth reasons for its deviation from the attorney's fee schedule of Civil Rule 82(a).
At the time of the crash, Douglas Sweat was an electrical lineman employed by ITT Arctic Services. Dispatched through his union, he left Anchorage on January 14 1974 for Cordova on an Alaska Airlines flight. After performing work in Boswell Bay, Sweat returned to Cordova on Saturday, January 19 and then planned to proceed to Cape Yakataga on a Chitina plane on the same day. Sweat's ticket to Cordova, Boswell Bay and Cape Yakataga was written on Alaska Airlines ticket stock.
The Chitina plane encountered deteriorating weather conditions over the Bering Glacier, and the pilot attempted to turn and return to Cordova. During this turn, the pilot experienced "whiteout" conditions and crashed on the Bering Glacier.
As a result of the crash, Mr. Sweat suffered injuries requiring fusion of the fourth and fifth lumbar vertebra and the sacrum, a paralyzed left leg, severe muscular atrophy of various muscles and extensive nerve damage. Sweat and his wife sued both Chitina Airlines and Alaska Airlines on May 30, 1974 alleging causes of action in contract and tort.
Alaska Airlines is authorized by the federal Civil Aeronautics Board (C.A.B.) to fly scheduled routes. This C.A.B. authorization creates a franchise of Alaska for those scheduled routes. Alaska also has authority to deliver United States mail on its scheduled flights.
Chitina is a corporation independent of Alaska Airlines. It is licensed by the State of Alaska to perform charter operations. Chitina has no independent authority to fly scheduled routes in Alaska or to carry United States mail.
Alaska Airlines is permitted by the C.A.B. to contract with other companies to service a part of its scheduled route. In May 1968, Alaska entered into a service contract with Wayne Smith, d/b/a Chitina Air Service. Under this agreement, Chitina agreed to carry mail and passengers over various of Alaska's scheduled routes, including Cordova to Cape Yakataga. 1 Chitina also agreed to carry insurance in the amount of $50,000.00 per passenger, $50,000.00 property damage and $50,000.00 bodily injury. 2
There is no indication that Alaska Airlines controls the maintenance of the planes, the hiring of pilots or the day-to-day affairs of Chitina. However, Alaska Airlines provides the schedule, the tickets and rates, and Chitina then charges Alaska Airlines an hourly rate. It is undisputed that the ticket issued to Douglas Sweat was an Alaska Airlines ticket, and Alaska Airlines admits that Sweat paid the scheduled fare. It is further admitted by Alaska Airlines that:
The flight on which Cessna 180, N9035M crashed on January 20, 1975 with Milford Douglas Sweat aboard was deemed by Alaska Airlines as Alaska Airline Flight Number 54. 3 The flight also was carrying United States mail.
Chitina Air and the Sweats entered into a "covenant not to sue" and stipulation dismissing the claim against Chitina with prejudice. Both the stipulation and the covenant not to sue specifically stated that the settlement did not include a release of Alaska Airlines.
As the sole remaining defendant, Alaska Airlines moved for summary judgment on the following points: (1) Alaska could not be vicariously liable for Chitina's acts since Chitina was an independent contractor and public policy does not support vicarious liability; and (2) if Alaska could be vicariously liable, then as a matter of law, the release of Chitina automatically released Alaska. The Sweats filed an opposition to Alaska's motion and a cross-motion for partial summary judgment. They claimed that as a matter of law, Alaska was vicariously liable under Restatement (Second) of Torts § 428 (franchise holder) or, alternatively, under the Restatement (Second) of Agency § 314. In a written decision, Superior Court Judge Seaborn J. Buckalew, Jr. granted the Sweats' motion for summary judgment. The trial court further held that the settlement did not release Alaska.
In deciding the summary judgment motion on March 5, 1976, the trial court considered ER-946, a recently-passed federal regulation. 4 The regulation was brought to the attention of the court and opposing counsel for the first time during oral argument on the summary judgment motion. Alaska had claimed that the federal government's approval of the Chitina subcontract indicated its approval of Chitina's financial independence, and obviated any public policy for imposing vicarious liability. At the oral argument for summary judgment, the Sweats introduced the regulation to rebut that contention, and at that time, counsel for Alaska Airlines made no objection. 5
The case proceeded to trial before Judge Blair on the issues of negligence and damages. 6 At trial, an expert economist for the Sweats testified as to the basis for calculating lost past income and future income and labor benefits. As a result of the accident, Sweat was unable to return to his job as a journeyman lineman. He was able, however, to obtain work as a draftsman with an engineering firm. The new job, which was less physically demanding, paid less and had less benefits. The expert testimony centered around the difference between the projected lost income and benefits of Sweat's old job and the income and benefits of Sweat's new job.
The trial court limited Alaska's cross-examination of Sweat's expert economist. It found the cross-examination outside the scope of direct examination and stated that if counsel wanted to develop his contentions, he could do so with his own witnesses during his own case. The trial court's decision to limit cross-examination forms the basis for one point of appeal.
Later in trial, Alaska did try to introduce evidence of lost income and benefits through its own expert economist. Counsel for the Sweats made timely objection on the grounds that: (1) the expert was a surprise witness who was not on the witness list, and the opportunity for pretrial discovery had been denied; (2) counsel for Alaska had seen the Sweats' summary of damages well before trial and the Sweats' expert witness was on the witness list, so Alaska had had ample opportunity to depose the expert and to secure its own economist and (3) the Sweats relied to their detriment on a court conference the previous day where the scope of Alaska's case was discussed. Alaska had not mentioned its expert economist in the conference, counsel for the Sweats had released their expert to...
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