Dell v. Heard, 75-1147
| Decision Date | 30 March 1976 |
| Docket Number | No. 75-1147,75-1147 |
| Citation | 532 F.2d 1330 |
| Parties | Craig A. DELL, Plaintiff-Appellant, v. William A. HEARD, Jr., Defendant-Appellee. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Zenon F. Myszkowski, Albuquerque, N. M., for plaintiff-appellant.
Eugene E. Klecan, Albuquerque, N. M., for defendant-appellee.
Before BREITENSTEIN, HILL and BARRETT, Circuit Judges.
This is a diversity case originating in the District of New Mexico. Appellant, a New Mexico resident, filed a complaint containing two counts. Count I alleged appellee, a resident of Arkansas, was married to Edna Heard at all times mentioned therein. Further allegations were that Edna Heard, on or about February 12, 1971, was driving a car within the scope and purpose of the family purpose doctrine, that a judgment was entered in appellant's favor against Edna Heard in a New Mexico state court as a result of her negligent actions while driving on the aforementioned date, and that only $10,000 of the $65,000 judgment had been paid. Appellant sought $55,000 plus costs from appellee. Count II alleged the specific negligent actions Edna Heard committed, described appellant's resulting injuries, claimed applicability of the family purpose doctrine and prayed for.$597,500 actual damages and costs.
Appellee answered and, for affirmative defenses as to Count I, said no cause of action was stated and appellant's contributory negligence barred recovery. As to Count II, appellee answered that no cause of action was stated, contributory negligence barred relief, and the "(f)ailure to bring an action against this defendant at the time Edna Heard was served bars a recovery."
The court sustained a motion to dismiss as to Count I " . . . because the defendant was not a party to the state court action which produced the judgment sought to be enforced against the defendant." The court denied a motion to dismiss Count II " . . . because the New Mexico law of family purpose doctrine applies to a vehicle driven by a spouse." Following this order, appellee filed an additional memorandum in support of his motion to dismiss Count II. Appellee sought to rely on " . . . diverse legal theories which could all be categorized broadly under the principles of equitable estoppel." The legal theories mentioned included res judicata, doctrine of election of remedies, public policy considerations, collateral estoppel, extinguishment of cause of action, and doctrine of merger. The court entered another order dismissing the complaint and action with prejudice. The court said:
Defendant's position that the plaintiff is barred from bringing this claim by the rule of election of remedies is well taken. Where an injured plaintiff, with full knowledge of all the facts, has recovered a valid judgment against the implied agent, the judgment is a bar to a subsequent action against the implied principal whose liability arises solely by virtue of the doctrine of respondeat superior, and without fault of his own, where the subsequent action is for the identical act of negligence of the implied agent.
Appellant filed a motion for rehearing with supporting affidavit. Appellant pointed to two attempts in the state action to have appellee joined on the ground the automobile was used within the family purpose doctrine. Both motions were apparently denied by the state judge. Appellee responded with an affidavit indicating the reason the motions were denied in state court was that they were not timely. The trial court denied the motion for rehearing.
The briefs on appeal deal most extensively with application of the doctrine of election of remedies. Although denominated an "election of remedies," the rule quoted by the trial court in dismissing Count II is really a statement of an "election of parties." Consequently, the applicability of the trial court's rule is not to be determined by a strict "election of remedies" analysis.
Appellant initially attacks the use of this election defense on a procedural ground. Appellant says the defense was not properly raised in the answer when appellee listed the following as an affirmative defense: "Failure to bring an action against this defendant at the time Edna Heard was served bars a recovery." Although it might be argued under the liberalized construction given pleadings, see, e. g., Mutual Creamery Ins. Co. v. Iowa Nat'l Mut. Ins. Co., 427 F.2d 504 (8th Cir. 1970), that the defense was properly and sufficiently raised, the stronger ground for decision here rests on F.R.Civ.P. 15(b). That rule provides in pertinent part: "When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings." Appellant did not object to the raising of the election defense as it was later amplified by appellee; appellant responded to the defense in a memorandum submitted to the court. Consequently, we hold the issue was tried by the implied consent of the parties. See 3 Moore's Federal Practice P 15.13(2) at 987 (2d ed. 1974).
From the many attacks made on applicability of the doctrine of election of remedies, we distill two major assaults relevant to the "election of parties" doctrine: (1) was the doctrine applicable in this case, and (2) was appellee estopped to plead an election because of his successful attempt to resist joinder in the state action?
This is a diversity case and the governing law is that of New Mexico. New Mexico recognizes the family purpose doctrine. A New Mexico jury instruction defining the doctrine read:
If a motor vehicle is maintained by the owner for the general use and convenience of his family, then the owner is liable for the negligence of a member of the family (whether he be a minor or an adult), having authority to drive the motor vehicle and while it is being used for the pleasure or convenience of the family or a member of it.
Peters v. LeDoux, 83 N.M. 307, 491 P.2d 524 (1971). The trial judge determined this doctrine was applicable when the spouse was the car's driver. The trial court, utilizing the family purpose doctrine, described the relationship of appellee and his wife as that of implied master and servant. Principles of master-servant law govern liability of the motor vehicle owner when the family purpose doctrine is invoked. 8 Am.Jur.2d Automobiles and Highway Traffic § 588 (1963). Consequently, the trial court had to determine the legal propriety of a subsequent suit against an implied master when a judgment had previously been secured against and partially satisfied by the implied servant.
As mentioned above, the trial court held the judgment in the prior action against the "servant" barred this subsequent action against the " master". Cases were cited where an election of the parties rationale was discussed in master-servant situations. We have not been cited to any controlling New Mexico law on the subject and we have not located any. Consequently, this is a case where we give great weight and credence to the view of the district judge concerning the unsettled law of the state in which that district judge sits. Sade v. Northern Natural Gas. Co., 501 F.2d 1003 (10th Cir. 1974); United States v. Hershberger, 475 F.2d 677 (10th Cir. 1973). Applying this salutary rule of appellate review to this case, we cannot say the trial court erred in its legal determination. 1
Appellant contends, even if the election would normally operate as a bar, no bar should be allowed here because appellee successfully resisted joinder in the state court. Appellant, thus, contends that action operates to estop appellee from claiming the bar of election. As support for appellant's argument, Ross v. T. C. Bateson Constr. Co., 270 F.2d 796 (5th Cir. 1959), is cited. In Ross, a materialman had filed a Miller Act suit against a prime contractor. A subcontractor, Ross, who had suffered financial loss because of the prime contractor's delay, had intervened, as had the subcontractor's surety. By counterclaim, Ross had sought his earnings under the subcontract. Other creditors had settled but the counterclaim cause of action had proceeded. An amendment to the counterclaim had sought damages caused by the delay in performance and delay in payment of an adjusted contract price. The trial judge had refused to allow the amendment. The action reported in Ross was the subsequent suit containing the allegations of the refused amendment to the counterclaim. The trial judge had granted a directed verdict against Ross, holding the former suit barred this action. The Fifth Circuit reversed and held that res judicata did not bar this...
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