Jackson v. Chandler

• Decision Date: 17 January 2003
• Docket Number: No. CV-02-0060-PR.,CV-02-0060-PR.
• Citation: 61 P.3d 17,204 Ariz. 135
• Parties: Robert JACKSON, Jr., an unmarried man, Plaintiff-Appellant, v. Donald Frank CHANDLER and Jane Doe Chandler, husband and wife; Purita Z. Sicat and John Doe Sicat, wife and husband, Defendants-Appellees.
• Court: Arizona Supreme Court

61 P.3d 17

204 Ariz. 135

Robert JACKSON, Jr., an unmarried man, Plaintiff-Appellant, v. Donald Frank CHANDLER and Jane Doe Chandler, husband and wife; Purita Z. Sicat and John Doe Sicat, wife and husband, Defendants-Appellees.

No. CV-02-0060-PR.

Supreme Court of Arizona, En Banc.

January 17, 2003.

Churchill & Frame By: John C. Churchill, Parker, and Toby Zimbalist, Phoenix, Attorneys for Plaintiff-Appellant.

Law Offices of Denise L. Siegenthaler & Associates By: Jan-Georg Roesch, Phoenix, Attorneys for Defendants-Appellees Chandler.

Boyle Pecharich Cline & Whittington By: Robert C. Kozak, Anna C. Young, Prescott, Attorneys for Defendants-Appellees Sicat.

OPINION

FELDMAN, Justice (Retired).

¶ 1 The automobile accident from which this case arose occurred in Arizona, but everyone involved was a California resident. The tort action that followed was filed in Arizona; it is timely if the Arizona statute of limitations applies but barred if California's applies. We granted review to examine choice-of-law principles and determine whether the Arizona or California statute of limitations governs. Rule 23(c)(3), Ariz. R.Civ.App.P. We have jurisdiction under Article VI, § 37 of the Arizona Constitution.

FACTS AND PROCEDURAL BACKGROUND

¶ 2 In August 1997, Robert Jackson left his home in Long Beach, California, and headed east on Interstate 10 to Louisiana, where he had a new job and intended to make his home. He had his possessions with him because had no intent to return to California. In La Paz County, some miles east of the Arizona-California border, a dust storm struck, markedly reducing visibility. Jackson pulled into the highway's emergency lane and parked. Two California residents, Donald Frank Chandler and Purita Z. Sicat (collectively Defendants), were driving their separate vehicles on Interstate 10. Because of the poor visibility, they collided with each other and then crashed into Jackson's vehicle, demolishing it.

¶ 3 Jackson suffered serious spinal injuries. On his release from the hospital, he returned to Long Beach and resumed residency there because the delay had cost him the job that was waiting for him in Louisiana. Jackson retained Arizona counsel, who negotiated with Defendants' insurance carriers in an attempt to reach a settlement. None was reached, and in August 1999 Jackson filed a tort action in La Paz County Superior Court. The action was timely under Arizona's two-year statute of limitations, A.R.S. § 12-542. It was untimely, however, under California's one-year statute, Cal.Code Civ. Proc. § 583.210.

¶ 4 Defendants moved for summary judgment, claiming the action was barred because California's statute of limitations was the proper choice of law. Jackson argued, to the contrary, both that the Arizona statute was to be applied and that the course of negotiations estopped Defendants from raising the California statute. The trial judge granted summary judgment to Defendants, holding that the California statute barred the action. The court of appeals affirmed, concluding that Arizona "has no particular interest" in providing a forum for recovery to a California resident for harm sustained in Arizona and that while Arizona "does have an interest in assuring that victims of accidents on Arizona highways are compensated," its "interest does not supercede California's interests in protecting defendants from stale claims and in assuring recovery for its own residents." Jackson v. Chandler, No. 1 CA-CV 00-0532, mem. dec. at ¶ 14 and n. 9 (filed Dec. 11, 2001). Believing the court of appeals has misapplied the controlling law because Arizona does have a substantial interest in the litigation even if it does not supersede California's, we vacate the court of appeals' memorandum decision and reverse the trial court's judgment. We address only the choice of law issue.

DISCUSSION

A. The RESTATEMENT

¶ 5 We have previously discussed various approaches to determining which statute of limitations should apply. See DeLoach v. Alfred, 192 Ariz. 28, 29

¶ 4, 960 P.2d 628, 629 ¶ 4 (1998). In DeLoach, we applied the construct adopted by the RESTATEMENT(SECOND) OF CONFLICT OF LAWS (hereinafter RESTATEMENT), as revised by the 1988 amendments. Id. at 29-31 ¶¶ 4-9, 960 P.2d at 629-31 ¶¶ 4-9. We see no reason to depart from the RESTATEMENT analysis, nor do the parties suggest that we should.

¶ 6 The RESTATEMENT'S conflict rules are based on an interests analysis. The RESTATEMENT sets forth the factors "relevant to the choice of the applicable rule of law where the law" of different states may be applied. RESTATEMENT § 6(2) (1971). But the RESTATEMENT contains specific provisions applying section 6 choice-of-law principles to statute of limitations questions. The 1971 version prohibited maintenance of a cause of action "if it is barred by the statute of limitations of the forum" but required that the action "will be maintained if it is not barred by the statute of limitations of the forum, even though it would be barred by the statute of limitations of another state." Id. § 142(1) and (2). This mechanistic and procedural approach was amended in 1988. The revised section, which we applied in DeLoach, reads:

Whether a claim will be maintained against the defense of the statute of limitations is determined under the principles stated in § 6. In general, unless the exceptional circumstances of the case make such a result unreasonable:

(1) The forum will apply its own statute of limitations barring the claim.

(2) The forum will apply its own statute of limitations permitting the claim unless:

(a) maintenance of the claim would serve no substantial interest of the forum; and

(b) the claim would be barred under the statute of limitations of a state having a more significant relationship to the parties and the occurrence.

RESTATEMENT § 142 (1988) (emphasis added).¹

¶ 7 In DeLoach we dealt with an accident in Tennessee in which one defendant was an Arizona resident and the other defendant and the plaintiff were not. We followed section 142, applying the statute of the forum— Arizona's two-year statute of limitations—to the Arizona action against the Arizona defendant. 192 Ariz. at 33 ¶ 19, 960 P.2d at 633 ¶ 19. We concluded "that the basic policies underlying tort law—to deter wrongful conduct and compensate victims" were best satisfied in this manner. Id.

¶ 8 Thus, as we said in DeLoach, under the revised section 142, the general rule "is very clear: as a starting point, the forum's statute of limitations applies." Id. at 30 ¶ 7, 960 P.2d at 630 ¶ 7. If a claim is barred in the forum it is rejected, but if it is not barred by the forum's limitations period, it is rejected only when the state has no substantial interest and the action is barred in another state with a closer relationship to the claim.² RESTATEMENT § 142 (1988).

¶ 9 The statute of limitation on this cause of action has run in California but not in Arizona. Thus, the issue before us is whether Arizona has a substantial interest in the action that would be served by maintaining the claim here. If there is no such substantial interest and if California had a more significant relationship to the parties and the accident, we would apply the California statute of limitations, which would bar the action in both states.³

B. The emerging trend and the new RESTATEMENT

¶ 10 We noted in DeLoach that the 1988 revisions to the RESTATEMENT were implemented "to employ a type of interest analysis approach recognized by the drafters as the `emerging trend' among courts." DeLoach, 192 Ariz. at 29 ¶ 4, 960 P.2d at 629 ¶ 4. There was a recognition that in recent cases "the courts select the state whose law will be applied to the issue of limitations by a process essentially similar to that used in the case of other issues of choice of law." RESTATEMENT § 142 cmt. e (1988). Thus, the new section 142 contained the two-step analysis we utilized in DeLoach and will employ here.

¶ 11 Before that analysis, however, it is instructive to look at two pre-revision cases that may well have been among the emerging trend discussed by the drafters of the RESTATEMENT. They are particularly relevant because both deal with Arizona automobile accidents and the interests served by the Arizona and California statutes of limitations.

1. Ledesma v. Jack Stewart Produce, Inc., 816 F.2d 482 (9th Cir.1987)

¶ 12 This diversity action began when a van occupied by California residents was struck on an Arizona highway by a truck owned by an Oklahoma company and operated by an Arkansas driver. The district court dismissed, based on California's limitations period, and the Ninth Circuit reversed, saying, "California has adopted a `governmental interest' approach to resolve choice-of-law problems." Ledesma v. Jack Stewart Produce, Inc., 816 F.2d 482, 484 (9th Cir.1987). In analyzing the interests of California and Arizona, the court reached several conclusions. California's interest in protecting its courts from stale claims is "at least equally balanced by its interest in allowing its residents to recover for injuries sustained in a state that would recognize their claim as timely." Id. at 485. Further, because the Arizona legislature has set a two-year limitations period, "Arizona's interest would be significantly impaired by a failure to apply its statute of limitations." Id. at 486. Quoting the Supreme Court of California, the Ninth Circuit held that "one of the primary purposes of a state in creating a cause of action... is to deter the kind of conduct within its borders which wrongfully [causes injury]." Id. (quoting Hurtado v. Superior Court, 11 Cal.3d 574, 114 Cal.Rptr. 106, 522 P.2d 666, 672 (1974)).

¶ 13 Before finally concluding that the Arizona statute of limitations should apply, the Ninth Circuit said, "Insofar as drivers tend to be more careful when their chances of incurring liability are more substantial, Arizona does have an interest in ensuring that its statute of...