Hyde v. Reynoldsville Casket Co.

• Decision Date: 09 February 1994
• Docket Number: No. 92-1682,92-1682
• Citation: 626 N.E.2d 75,68 Ohio St.3d 240
• Parties: HYDE, Appellant, v. REYNOLDSVILLE CASKET COMPANY et al., Appellees.
• Court: Ohio Supreme Court

Page 240

68 Ohio St.3d 240

626 N.E.2d 75

HYDE, Appellant, v. REYNOLDSVILLE CASKET COMPANY et al., Appellees.

No. 92-1682.

Supreme Court of Ohio.

Submitted Sept. 28, 1993.

Decided Feb. 9, 1994.

SYLLABUS BY THE COURT

Bendix Autolite Corp. v. Midwesco Enterprises, Inc. (1988), 486 U.S. 888, 108 S.Ct. 2218, 100 L.Ed.2d 896, may not be retroactively applied to bar claims in state courts which had accrued prior to the announcement of that decision. (Section 16, Article I, Ohio Constitution, applied.)

On March 5, 1984, appellant Carol L. Hyde was injured in a traffic accident in Ashtabula County, Ohio, allegedly caused by the negligence of John M. Blosh while he was operating a vehicle owned by the Reynoldsville Casket Company ("RCC").

It is not disputed that RCC is a Pennsylvania corporation which is not licensed to do business in Ohio and has not appointed an agent to receive service of process in the state.

On August 11, 1987, Hyde filed a complaint in the Court of Common Pleas of Ashtabula County. The complaint alleged that Blosh had negligently caused Hyde's injuries and contended that because "Blosh's actions were in the scope and course of his employment with the [Reynoldsville] Casket Co.," RCC was also liable for those injuries.

On February 8, 1988, RCC and Blosh then filed a motion to dismiss, claiming that the complaint was barred by Ohio's statute of limitations. The trial court granted the motion, and the court of appeals affirmed the trial court's decision.

This cause is now before this court pursuant to the allowance of a motion to certify the record, 65 Ohio St.3d 1456, 602 N.E.2d 252.

David J. Eardley, Chardon, for appellant.

William E. Riedel, Ashtabula, for appellees.

Williams, Jilek, Lafferty & Gallagher Co., L.P.A., and Dale M. Grocki, Toledo, urging reversal for amicus curiae, Ohio Academy of Trial Lawyers.

Brown & Szaller Co., L.P.A., and James F. Szaller, Cleveland, urging reversal for amicus curiae, Brown & Szaller Co., L.P.A.

Spangenberg, Shibley, Traci, Lancione & Liber, Robert A. Marcis and Cathleen M. Bolek, Cleveland, urging reversal for amicus curiae, Spangenberg, Shibley, Traci, Lancione & Liber.

Arter & Hadden, Irene C. Keyse-Walker and Robert C. Tucker, Cleveland, urging affirmance for amicus curiae, Dalkon Shield Claimants Trust. ¹

PFEIFER, Justice.

This court is asked to determine whether the United States Supreme Court decision in Bendix Autolite Corp. v. Midwesco Enterprises, Inc. (1988), 486 U.S. 888, 108 S.Ct. 2218, 100 L.Ed.2d 896, holding the Ohio tolling statute, R.C. 2305.15(A), to be unconstitutional, should be retroactively applied to Hyde's complaint filed against RCC and Blosh. For the following reasons, we determine that Bendix may not be retroactively applied.

Unless Hyde may utilize the tolling provision in R.C. 2305.15(A), her claim is precluded by the applicable statute of limitations. In Ohio, the period of limitations for a personal injury negligence action is two years. R.C. 2305.10. Hyde filed her complaint seventeen months after this two-year period had expired. At the time of the accident, R.C. 2305.15, now 2305.15(A), tolled the limitations period for claims against out-of-state defendants by providing:

"When a cause of action accrues against a person, if he is out of the state, or has absconded, or conceals himself, the period of limitation for the commencement of the action as provided in sections 2305.04 to 2305.14 * * * of the Revised Code, does not begin to run until he comes into the state or while he is so absconded or concealed. After the cause of action accrues if he departs from the state, or absconds or conceals himself, the time of his absence or concealment shall not be computed as any part of a period within which the action must be brought." 129 Ohio Laws 177.

It is not alleged that RCC re-entered the state of Ohio after the accident of March 5, 1984. Pursuant to R.C. 2305.15, the limitations period for Hyde to bring an action against RCC was tolled, and had not elapsed when Hyde filed her complaint. See Seeley v. Expert, Inc. (1971), 26 Ohio St.2d 61, 55 O.O.2d 120, 269 N.E.2d 121.

Nearly one year after Hyde filed her complaint, the United States Supreme Court determined that the tolling provision in R.C. 2305.15 violated the Commerce Clause of the United States Constitution when applied to out-of-state entities. Bendix, supra. In its opinion, the Bendix court specifically declined to determine whether its ruling should be applied prospectively only. Id., 486 U.S. at 895, 108 S.Ct. at 2222-2223, 100 L.Ed.2d at 905.

We are now confronted with the task of determining whether the Bendix decision is to be applied retroactively. Until recently, Chevron Oil Co. v. Huson (1971), 404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296, provided the three-part test to determine whether courts should retroactively apply a decision of the United States Supreme Court when the result is to shorten limitations periods of cases accrued before the decision was announced. However, in Harper v. Virginia Dept. of Taxation (1993), 509 U.S. ----, 113 S.Ct. 2510, 125 L.Ed.2d 74, the United States Supreme Court announced a new test concerning the retroactive application of decisions. It is unclear whether Harper was intended to replace Chevron, or to supplement it.

I

If Chevron remains good law today, then that case--and not Harper--provides the proper test to apply to the present case. The present case is closer to Chevron than to Harper. Harper determined that a United States Supreme Court decision striking down a Michigan taxing practice as unconstitutional must be retroactively applied to Virginia taxpayers taxed under a similar statute. Chevron discusses whether a ruling which shortens a limitations period should be retroactively applied.

Chevron sets forth the following three-pronged test to determine when a holding of the United States Supreme Court should not be retroactively applied:

"First, the decision to be applied nonretroactively must establish a new principle of law, either by overruling clear past precedent on which litigants may have relied, * * * or by deciding an issue of first impression whose resolution was not clearly foreshadowed * * *. Second, it has been stressed that 'we must * * * weigh the merits and demerits in each case by looking to the prior history of the rule in question, its purpose and effect, and whether retrospective operation will further or retard its operation.' * * * Finally, we have weighed the inequity imposed by retroactive application, for '[w]here a decision of this Court could produce substantial inequitable results if applied retroactively, there is ample basis in our cases for avoiding the "injustice or hardship" by a holding of nonretroactivity.' " 404 U.S. at 106-107, 92 S.Ct. at 355, 30 L.Ed.2d at 306.

The facts in the present case pass the three-pronged Chevron test for nonretroactivity. The United States Supreme Court's opinion in Bendix, supra, was the first time that any court of binding authority in Ohio's state courts had ruled R.C. 2305.15 unconstitutional. When Hyde was injured, she could not have foreseen that R.C. 2305.15 would be struck down four years later. "The most [s]he could do was to rely on the law as it then was." Chevron, 404 U.S. at 107, 92 S.Ct. at 356, 30 L.Ed.2d at 306.

Because of the factual similarities between the present case and Chevron, it is unnecessary to discuss the other two prongs of the Chevron test. The Chevron court held that the retroactive application of a rule shortening the limitations period in a tort case fulfilled the last two requirements of the test for nonretroactivity. Because all three requirements of the Chevron test are likewise fulfilled in this case, we determine that Bendix cannot be retroactively applied.

II

Even if the Chevron test has been replaced by Harper, the retroactive application of Bendix remains impermissible.

In Harper, the United States Supreme Court determined that its prior decision in Davis v. Michigan Dept. of Treasury (1989), 489 U.S. 803, 109 S.Ct. 1500, 103 L.Ed.2d 891, should be retroactively applied. The Davis decision declared that it was unconstitutional for the state of Michigan to tax retirement benefits paid by the federal government when that state exempts retirement benefits paid by the state or its political subdivisions. The state of Virginia, in Harper, argued that Davis should not be retroactively applied.

The United States Supreme Court rejected Virginia's argument, holding that Davis must be retroactively applied. However, the Supreme Court declined to enter judgment for the taxpayers "because federal law does not necessarily entitle them to a refund." Harper, supra, 509 U.S. at ----, 113 S.Ct. at 2519, 125 L.Ed.2d at 88. The Harper court went on to note that a state, when retroactively applying a Supreme Court decision, " 'retains flexibility' " in fashioning appropriate relief. Id. at ----, 113 S.Ct. at 2518, 125 L.Ed.2d at 89, quoting McKesson Corp. v. Div. of Alcoholic Beverages & Tobacco (1990), 496 U.S. 18, 39-40, 110 S.Ct. 2238, 2252, 110 L.Ed.2d 17, 38. Harper allows state courts to tailor their own remedies as they determine the manner in which a Supreme Court opinion is to be retroactively applied.

The Ohio Constitution prohibits us from applying Bendix to those claims already accrued when that decision was announced by the United States Supreme Court. If we were to retroactively apply the holding in Bendix, we would extinguish the claims of injured persons who had justifiably relied on R.C. 2305.15, because of a subsequent determination by the United States Supreme Court that they could not have foreseen. Such an application would clearly violate the rights of Ohioans to obtain a meaningful opportunity to bring their claims in Ohio's courts. The retroactive application of Bendix would violate the rights afforded by Section 16, Article I of the Ohio Constitution, which provides in part:...