Farrell v. Ford Motor Co.

• Decision Date: 05 April 1993
• Docket Number: Docket No. 132635
• Citation: Farrell v. Ford Motor Co., 199 Mich.App. 81, 501 N.W.2d 567 (Mich. App. 1993)
• Parties: , Prod.Liab.Rep. (CCH) P 13,590 David FARRELL, administrator of the Estate of Theresa Farrell, deceased, Plaintiff-Appellee, v. FORD MOTOR COMPANY, a Delaware corporation, Defendant-Appellant.
• Court: Court of Appeal of Michigan

Page 567

501 N.W.2d 567

199 Mich.App. 81, Prod.Liab.Rep. (CCH) P 13,590

David FARRELL, administrator of the Estate of Theresa Farrell, deceased, Plaintiff-Appellee, v. FORD MOTOR COMPANY, a Delaware corporation, Defendant-Appellant.

Docket No. 132635.

Court of Appeals of Michigan.

Submitted December 9, 1992, at Detroit.

Decided April 5, 1993, at 9:25 a.m.

Released for Publication June 24, 1993.

Goodman, Lister, Seikaly & Peters, P.C., by Richard M. Goodman, Darrel Peters, and Thomas W. Stephens, Detroit (Robert A. Sedler, of counsel), for plaintiff-appellee.

John M. Thomas, Dearborn, and Dickinson, Wright, Moon, Van Dusen & Freeman, by John E.S. Scott and Jerry L. Johnson, Detroit, for defendant-appellant.

Before MARK J. CAVANAGH, P.J., and MacKENZIE and RICHARD ALLEN GRIFFIN, JJ.

RICHARD ALLEN GRIFFIN, Judge.

This appeal stems from a products liability action filed in the Wayne Circuit Court. Plaintiff, an administrator of a North Carolina decedent's estate, seeks to recover wrongful-death damages arising from an accident involving an allegedly defective Ford automobile purchased and registered in North Carolina. The accident occurred in Winston-Salem, North Carolina, and took the life of a North Carolina resident. Ford Motor Company is a Delaware corporation whose world headquarters are located in Michigan. The issue before us is whether Michigan law or North Carolina law governs this lawsuit. We apply Michigan's interest-analysis rule regarding choice of law, and hold that North Carolina law applies. Accordingly, we reverse the decision of the circuit court, which held that Michigan law applied.

I

On December 5, 1988, plaintiff's decedent, Theresa Farrell, a resident of North Carolina, was killed in an automobile accident in North Carolina. According to plaintiff's complaint, decedent was crushed to death when the transmission of her 1980 Ford LTD station wagon slipped out of park and into reverse gear, backing over her.

The instant lawsuit against Ford was filed in the Wayne Circuit Court on February 1, 1990. In his complaint, plaintiff asserted liability against Ford on various theories, including negligence, gross negligence, and breach of warranty. Ford answered the complaint, and on June 27 1990, filed a motion for summary disposition. Ford argued in part that North Carolina law governed this case and that plaintiff's claim was time-barred pursuant to North Carolina's six-year statute of repose applicable to products liability actions. N.C. Gen.Stat. § 1-50(6).

Following a hearing, the circuit court denied defendant's motion. The circuit court held that Michigan law, rather than North Carolina, law would apply to plaintiff's claim. The court's ruling was based on the recent decision of the United States Court of Appeals for the Sixth Circuit in Mahne v. Ford Motor Co., 900 F.2d 83 (C.A.6 1990), which, on similar facts, held that Michigan law would apply. By order dated November 30, 1990, we granted defendant's application for leave to appeal.

II

On appeal, defendant contends that the circuit court's ruling was in error. Defendant argues that Michigan's choice-of-law rule compels the conclusion that North Carolina law rather than Michigan law governs this lawsuit. Specifically, defendant contends that North Carolina has a significant interest in having its law applied to the facts of this case, whereas Michigan has no comparable interest in applying its law. In addition, defendant submits that Mahne, supra, the case relied on by the trial court, was wrongly decided. After thorough review, we agree with defendant's argument.

III

The history of Michigan's choice-of-law rule was outlined by Justice Williams in his plurality opinion in Sexton v. Ryder Truck Rental, Inc., 413 Mich. 406, 419-423, 320 N.W.2d 843 (1982):

For a great many years, Michigan embraced the Bealeian conflict-of-laws notion that when a cause of action is maintained for injury sustained in a foreign jurisdiction, the substantive rights of the parties are to be automatically fixed and governed by the law of the place where the wrong occurred ³--the lex loci delicti. In support of this rule, courts in Michigan as well as other jurisdictions have largely relied on the teachings of the original Restatement Conflict of Laws, and particularly § 378 of that treatise which states: "The law of the place of wrong determines whether a person has sustained a legal injury." "The place of wrong is in the state where the last event necessary to make an actor liable for an alleged tort takes place." Id., § 377.

The traditional advantages advanced on behalf of the lex loci rule have included discouraging forum shopping and furthering the goals of certainty and predictability through its ease of application, thus simplifying the task of both lawyers and the courts.

Despite these reputed advantages, modern scholars and about half or more of the states have rejected its rigidity since the rule often produced obvious rather than just results through its failure to consider the interests of other jurisdictions in the litigated matter.

The retreat by the Supreme Court from its lex loci delicti approach began in Sweeney v. Sweeney, 402 Mich. 234, 262 N.W.2d 625 (1978). In Sweeney, the Court established an exception to lex loci delicti for reasons of public policy. The narrow issue resolved in Sweeney was whether two Michigan family members involved in a single-car accident in Ohio should be bound by Ohio law with regard to intrafamily immunity or whether Michigan's law should apply. In deciding in favor of the application of Michigan law to the Michigan litigants, the Supreme Court held:

The state of residence has a substantial interest in the parent-child legal relationship. Michigan's announced public policy is to permit a child "to maintain a lawsuit against his parent for injuries suffered as a result of the alleged ordinary negligence of the parent". That public policy should apply to Michigan residents suing in Michigan courts even though the alleged negligence occurred in Ohio.

Automatic application of lex loci delicti in this daughter against father suit would frustrate an announced Michigan public policy. Whether lex loci delicti should be applied in other situations is not decided here. [Id. at 242, 262 N.W.2d 625.]

The next choice-of-law case decided by the Supreme Court was Sexton, supra. Although no opinion of the Court was rendered, a majority of the justices in separate opinions by Justices Williams, T.G. Kavanagh, and Levin agreed to abandon the rule of lex loci delicti and to overrule Abendschein v. Farrell, 382 Mich. 510, 170 N.W.2d 137 (1969). However, the Sexton Court did not establish a new rule for choice of law.

The most recent pronouncement by the Supreme Court on choice of law is Olmstead v. Anderson, 428 Mich. 1, 400 N.W.2d 292 (1987). In Olmstead, the Court continued to decide issues of choice of law case by case and again failed to adopt a comprehensive choice-of-law methodology. See In re Disaster at Detroit Metro Airport, 750 F.Supp. 793, 797 (E.D.Mich.1989). The holding of Olmstead is that the law of the forum (lex fori) should be applied unless there is a "rational reason" to displace it. Finding no such reason in Olmstead, the Supreme Court found it unnecessary to take the next step, which would be to resolve the conflict of laws.

Professor Robert Allen Sedler, who serves as co-counsel for the plaintiff in this appeal, has summarized the modern choice-of-law methodologies as follows:

While academic commentators have long agreed that the traditional approach [lex loci delicti] should be abandoned, they have sharply disagreed over what approach should be adopted in its stead. The same disagreement was reflected in judicial decisions when Abendschein was decided. As inAbendschein, lawyers arguing for the abandonment of the traditional approach tended to urge replacement by the "state of the most significant relationship" approach of the Restatement (Second) of Conflict of Laws; this approach had been explicitly adopted by a number of courts at that time. The most influential academic approach, however, appeared to be Currie's interest analysis, which based the choice of law decision on the policies reflected in the laws of the involved states and the interest of each state, in light of those policies in having its law applied on the point in issue. ²² Some courts expressly followed Currie's approach; ²³ some followed Leflar's approach of choice-influencing considerations, ²⁴ some were more eclectic, looking to different approaches which would support the particular result they desired to reach. ²⁵

[Sedler, Choice of Law In Michigan: A Time to Go Modern, 24 Wayne LR 829, 833 (1978).]

Although the Supreme Court has neither accepted nor rejected the various modern approaches, it has discussed with apparent approval the interest-analysis approach adopted by this Court. See Olmstead, supra, 428 Mich. at 21-23, 400 N.W.2d 292. Further, the Court has expressed its disfavor of result-oriented forum shopping:

The concern surrounding forum shopping stems from the fear that a plaintiff will be able to determine the outcome of a case simply by choosing the forum in which to bring the suit. Presumably, plaintiffs will bring suit in the forum whose law is the most advantageous. In so doing, the plaintiff may be attempting to obtain a favorable result simply by choosing the right forum.... [Olmstead, supra at 26, 400 N.W.2d 292.]

IV

This brings us to our decision in Hampshire v. Ford Motor Co., 155 Mich.App. 143, 399 N.W.2d 36 (1986), which we find dispositive. In Hampshire, a California resident, while driving in California, sustained severe injuries when he was struck head-on by an automobile manufactured by Ford Motor Company. At the time of the accident, the Ford automobile was stolen. The plaintiff brought an action against Ford in Michigan, alleging that Ford had negligently designed the...