Buckles v. BH Flowtest, Inc.
| Decision Date | 24 November 2020 |
| Docket Number | DA 19-0546 |
| Citation | 402 Mont. 145,2020 MT 291,476 P.3d 422 |
| Parties | Zachary Scott BUCKLES, Deceased, by and through his Personal Representative, Nicole R. Buckles, and Nicole R. Buckles, Personal Representative, on behalf of the heirs of Zachary Scott Buckles, Plaintiffs and Appellees, v. BH FLOWTEST, INC., a Montana Corporation, and Black Rock Testing, Inc., a Montana Corporation, Defendants and Appellants, Continental Resources, Inc., an Oklahoma Corporation, Janson Palmer, d/b/a/ Black Gold Testing, and John Does I-V, Defendants. |
| Court | Montana Supreme Court |
For Appellant Black Rock Testing, Inc.: Kelly J.C. Gallinger, Aaron M. Dunn, Brown Law Firm, P.C., Billings, Montana
For Appellant BH Flow Testing, Inc.: Christopher C. Stoneback, Leonard H. Smith, David F. Knobel, Crowley Fleck PLLP, Billings, Montana
For Appellees: A. Clifford Edwards, Edwards & Culver, Billings, Montana, Robert J. Savage, Savage Law Firm, Sidney, Montana
¶1 This is a consolidated appeal in which Defendants BH Flowtest, Inc. (BH Flowtest) and Black Rock Testing, Inc. (Black Rock) appeal the August 19, 2016 and February 8, 2019 orders of the Seventh Judicial District Court, Richland County, determining Montana law applies to the wrongful death action brought by Nicole R. Buckles (Buckles) on behalf of the estate of her deceased son, Zachary Scott Buckles (Zachary), whose death occurred in the State of North Dakota. Upon the District Court's certification as final for purposes of appeal pursuant to M. R. Civ. P. 54(b) and M. R. App. P. 6(6), we restate and address the following issue:
Did the District Court err in determining Montana law, not North Dakota law, governs Buckles’ claims against BH Flowtest and Black Rock?
¶2 We affirm.
¶3 In April 2014, Zachary died of exposure to high levels of hydrocarbon vapors while manually gauging crude oil production tanks on Continental Resources, Inc.’s Columbus Federal 2-16H well site located near Alexander, North Dakota. The Columbus Federal 2-16H well site is part of the Bakken Reservoir and is a tank battery consisting of twenty tanks that support five production oil wells, including the Tallahassee 2016H tank number three and Tallahassee 3-16H tank number one.
¶4 On April 17, 2014, Zachary was dispatched from his residence in Glasgow, Montana, to the Columbus Federal 2-16H well site by his employer, Janson Palmer, doing business as Black Gold Testing (Black Gold) to perform manual gauging of the well site's crude oil production tanks. Black Gold was contracted to perform manual tank gauging services for Continental pursuant to Continental's Master Service Contract with BH Flowtest, who subcontracted with Black Rock. Black Rock then subcontracted with Black Gold. BH Flowtest, Black Rock, and Black Gold are all Montana business entities. Continental is an Oklahoma corporation authorized to do business in Montana since 1990.
¶5 On March 2, 2015, Buckles, acting as personal representative of Zachary's estate, filed a complaint against Continental, BH Flowtest, Black Rock, and Black Gold in Montana's Seventh Judicial District Court, Richland County, alleging the Defendants are liable for Zachary's death.
¶6 On June 22, 2015, Black Rock filed a Motion for Declaration of Applicable Law requesting that the District Court apply North Dakota substantive law to Buckles’ tort claims. BH Flowtest joined Black Rock's motion. The District Court denied the motion and determined that Montana law applies.
¶7 On November 16, 2017, Black Rock requested the District Court reconsider its decision in light of this Court's reversal and remand of the District Court's dismissal of Continental on jurisdictional grounds, see Buckles v. Cont'l Res., Inc. , 2017 MT 235, 388 Mont. 517, 402 P.3d 1213 ( Buckles I ),1 and the issuance of an order in United States District Court for the District of Montana, Otto v. Newfield Exp. Co. , No. CV 15-66-BLG-SPW, 2016 U.S. Dist. LEXIS 195741, 2016 WL 9461791 (D. Mont., July 25, 2016). BH Flowtest joined the motion. On February 8, 2019, the District Court denied Black Rock's motion. This appeal followed.
¶8 A district court's determination of which state's substantive law governs an action is a question of law reviewed de novo. Hutchins v. Hutchins , 2018 MT 275, ¶ 6, 393 Mont. 283, 430 P.3d 502 (citing Masters Group Int'l, Inc. v. Comerica Bank , 2015 MT 192, ¶ 33, 380 Mont. 1, 352 P.3d 1101 ). See also HSBC Bank USA, N.A. v. Anderson , 2017 MT 257, ¶ 17, 389 Mont. 106, 406 P.3d 416 (). A district court's factual findings underlying its choice of law determination are reviewed for clear error. Mazza v. Am. Honda Motor Co. , 666 F.3d 581, 14-15 (9th Cir. 2012).
¶9 Did the District Court err in determining Montana law, not North Dakota law, governs Buckles’ claims against BH Flowtest and Black Rock?
¶10 Where a conflict arises regarding which state's substantive law applies to a particular action, we apply the approach from the Restatement (Second) on Conflict of Laws. Phillips v. GMC , 2000 MT 55, ¶ 23, 298 Mont. 438, 995 P.2d 1002. The Restatement's conflict of laws analysis is two-part, beginning with § 6. Talbot v. WMK-Davis, LLC , 2016 MT 247, ¶ 23, 385 Mont. 109, 380 P.3d 823. "Section 6 first asks whether the forum state has a statutory directive concerning choice of law applicable to the underlying cause of action." Talbot , ¶ 23 (citing Restatement (Second) Conflict of Laws § 6(1) ). If a statutory directive exists, we apply the statute and no further inquiry is necessary. Talbot , ¶ 23.
¶11 Where no statutory directive exists, the Court considers the principles outlined in § 6(2) with the specific section of the Restatement that is applicable to the case. Talbot , ¶ 23 (citing Phillips , ¶¶ 28-30 ). Section 6(2) provides:
Talbot , ¶ 23. We have noted that the § 6(2) factors "provide[ ] a more flexible approach which permits analysis of the policies and interests underlying the particular issue before the court, and ... that any analysis under the Restatement approach is necessarily driven by the unique facts, issues, applicable law, and jurisdictions implicated in a particular case." Talbot , ¶ 23 (quotations and alterations omitted). See also Oberson v. Federated Mut. Ins. Co. , 2005 MT 329, ¶ 13, 330 Mont. 1, 126 P.3d 459 (citations omitted) ("[I]n choice of law cases, this Court has consistently rejected rigid rules, favoring the modern trend toward a ‘more flexible approach which permits analysis of the policies and interests underlying the particular issue before the court.’ ").
¶12 There is no statutory directive regarding choice of law in Montana for issues sounding in tort. Phillips , ¶ 23. Therefore, we consider the § 6(2) factors, along with §§ 145, 146, and 175 of the Restatement, all of which specifically apply to tort and personal injury actions. Phillips , ¶ 29. In doing so, we begin with the initial presumption stated in § 145(1), and reiterated in §§ 146 and 175, which "provide[s] that the rights and liabilities of the parties are to be determined in accordance with the law of the state where the injury occurred ...." Restatement (Second) on Conflict of Laws, § 145.
¶13 This presumption is not irrefutable. The place of injury is simply one of the forums whose public policies and interests in the litigation the court must consider under the factors of § 6(2). See Phillips , ¶ 30. The law of the state of the injury will not control if, "with respect to a particular issue, another state has a more significant relationship." Phillips , ¶ 32. To determine which state has the most significant relationship, we look to the factors listed in § 145(2):
Phillips , ¶ 29. The contacts referenced in § 145(2) "are to be evaluated according to their relative importance with respect to the particular issue." Phillips , ¶ 29.
¶14 We are also mindful of Comment e to § 146, which explains that when the injury and the conduct causing the injury occur in different states:
The local law of the state where the personal injury occurred is most likely to be applied when the injured person has a settled relationship to that state, either because he is domiciled or resides there or because he does business there. When, however, the injured person is domiciled or resides or does business in the state where the conduct occurred, there is a greater likelihood that this state is to be the state of most significant relationship and therefore the state of the applicable law with respect to issues that would usually be determined by the local law of the state of injury.
The comment goes on to explain that the state where the conduct occurred "is even more likely to be the state of most significant relationship" when the relationship between the parties is centered in that state and the parties are domiciled,...
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