BAACT Corp. v. Executive Aero, Inc.
| Decision Date | 10 February 1977 |
| Docket Number | No. 46624,46624 |
| Citation | 251 N.W.2d 107,312 Minn. 143 |
| Parties | BAACT CORPORATION, Respondent, v. EXECUTIVE AERO, INC., Appellant. |
| Court | Minnesota Supreme Court |
Syllabus by the Court
1. One joint tortfeasor is entitled to contribution from the other where the issues of liability were tried under Wisconsin law and each was found negligent, and where the negligence of defendant, against whom contribution is sought, was independent of the negligence of plaintiff.
2. A judicial sale in bankruptcy vesting a chose in action is not subject to collateral attack.
Meagher, Geer, Markham, Anderson, Adamson, Flaskamp & Brennan, and O. C. Adamson, II, R. D. Blanchard and John Hally Riley, Thomson, Lovett, Wahlfors & Moran and Thomas G. Lovett, Jr., Minneapolis, for appellant.
Richards, Montgomery, Cobb & Bassford, Nathan A. Cobb and Jerome C. Briggs, Minneapolis, for respondent.
Considered and decided by the court en banc.
BAACT CORP. commenced this action against Executive Aero, Inc., seeking indemnity or contribution. The trial court ordered judgment for BAACT in the sum of $72,155.25. Executive Aero appeals from the judgment and the denial of its post-trial motion. We affirm.
The following issues are presented by this appeal:
(1) Does Wisconsin or Minnesota law govern the issue of contribution?
(2) Does a purchaser of assets in bankruptcy succeed to a bankrupt's right of contribution?
On March 21, 1965, an aircraft owned by Tayam, a partnership, crashed in Wisconsin. Seven passengers were killed and five were injured. Tayam sued the manufacturer of the plane, Mooney Aircraft, Inc. (Mooney), and the retailer, Executive Aero, Inc. A second suit on behalf of the passengers was brought against the same defendants.
Both cases were venued in Hennepin County and consolidated for trial. The issue of negligence was submitted to the jury under the Wisconsin comparative negligence statute. The jury found Executive Aero 55 percent and Mooney 45 percent causally negligent. Damages totaled $160,345 $131,845 for various personal injuries and $28,500 for damage to Tayam's aircraft. Judgment was entered against both defendants with each being jointly and severally liable. 1 To secure the collection of their judgment against Mooney the successful plaintiffs brought an action on the judgment in Texas, where Mooney owned real estate. They secured a Texas judgment in the sum of $160,345 on May 10, 1968.
On February 17, 1969, Mooney filed a petition for voluntary bankruptcy and the bankruptcy court authorized the receiver to sell Mooney's assets to American Electronic Laboratories, Inc. (AEL). AEL formed a new corporation, BAACT CORP., 2 to receive the assets of the bankrupt and to continue its business operations. A bill of sale was issued to BAACT on March 25, 1969.
On May 10, 1969, BAACT paid $144,310.50 toward the Texas judgment entered against Mooney with checks drawn on AEL. Executive Aero's insurer, Ohio Casualty Insurance Company, satisfied the balance of the judgment.
In 1970, BAACT and AEL brought this action in Hennepin County District Court to compel contribution or indemnity from Executive Aero. The court required BAACT and AEL to decide which of them, if either, owned Mooney's alleged cause of action for contribution. The parties chose BAACT. The court ordered a bifurcated trial of the case to sever the issues as to the plaintiff's claim for contribution from the issues as to the plaintiff's claim for indemnity and so as to provide for a hearing to take up the legal questions as to contribution. The other issues were to be decided in separate trial by jury at a later date. In addition, the court ordered the parties to prepare a stipulated set of facts and to brief three issues:
(1) Has plaintiff acquired, by assignment or otherwise, a viable cause of action for contribution against defendant?
(2) Are the contribution rights governed by the law of Wisconsin or the law of Minnesota?
(3) Are the determinations made in the jury's verdict in the original actions res judicata?
The court held that BAACT was entitled to contribution as a matter of law and made the following conclusions of law:
a. Mooney Aircraft, Inc. and Executive Aero, Inc. were joint tort-feasors.
b. Mooney Aircraft, Inc. was negligent, its negligence was a direct cause of plaintiffs' injuries and damages, and the percentage of negligence attributable to Mooney Aircraft, Inc. arising out of the accident of March 25, 1965, was 45 per cent.
c. Executive Aero, Inc. was negligent, its negligence was...
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...application of the doctrine of res judicata is a question of law that we review de novo. See, e.g., BAACT Corp. v. Executive Aero, Inc., 312 Minn. 143, 145-46, 251 N.W.2d 107, 109 (1977); First & Am. Nat'l Bank v. Higgins, 208 Minn. 295, 319, 293 N.W. 585, 597 (1940). The determination of w......
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