Jaqua v. Canadian Nat. R.R., Inc.

• Decision Date: 06 March 2007
• Docket Number: Docket No. 268506.
• Citation: 274 Mich. App. 540,734 N.W.2d 228
• Court: Court of Appeal of Michigan — District of US
• Parties: Therese A. JAQUA, as personal representative of the Estate of John D. Jaqua, Plaintiff-Appellee, v. CANADIAN NATIONAL RAILROAD, INC., d/b/a Grand Trunk Western Railroad, Inc., Defendant-Appellant.

734 N.W.2d 228

274 Mich. App. 540

Therese A. JAQUA, as personal representative of the Estate of John D. Jaqua, Plaintiff-Appellee, v. CANADIAN NATIONAL RAILROAD, INC., d/b/a Grand Trunk Western Railroad, Inc., Defendant-Appellant.

Docket No. 268506.

Court of Appeals of Michigan.

Submitted January 9, 2007 at Detroit.

Decided March 6, 2007 at 9:10 a.m.

Released for Publication June 21, 2007.

Doran & Murphy, L.L.P. (by Michael H. Doran, George S. Adamson, and Scott J. Whitbeck), Buffalo, NY, for the plaintiff.

Gallagher Sharp (by Kevin C. Alexandersen, Sheila A. McKeon, Holly M. Olarczuk-Smith, Colleen A. Mountcastle, and Anna S. Fister) Cleveland, OH, for the defendant.

Before: SAAD, P.J., and MARK J. CAVANAGH and SCHUETTE, JJ.

SAAD, P.J.

I. Nature of the Case

The railroad employer's appeal of the trial court's denial of summary disposition on plaintiff's claim under the Federal Employers' Liability Act (FELA), 45 U.S.C. 51 et seq., raises a question of the permissible scope of releases under FELA. Section 5 of FELA prohibits a railroad from requiring employees to sign agreements that allow the railroad to escape liability imposed under the act. But the United States Supreme Court has also ruled that § 5 does not prevent an employer from settling a specific claim and controversy with an employee. The narrow question here is whether § 5 permits a release of only known injuries or conditions that exist at the time of the release, as the Court of Appeals for the Sixth Circuit has ruled, or whether § 5 also permits the release of known risks of future injuries or conditions, as the Court of Appeals for the Third Circuit has ruled.

In this case, the employee released his employer from liability for asbestos exposure and asbestosis, which was a condition he had at the time of the release, but he also released his employer for liability for cancer, a condition he knew he was at risk of developing in the future. The trial court relied on the Sixth Circuit's decision in Babbitt v. Norfolk & W. R. Co., 104 F.3d 89 (C.A.6, 1997), and denied the railroad's claim that the lawsuit is barred by the release. We reverse because we adopt the ruling of the Third Circuit in Wicker v. Consolidated Rail Corp., 142 F.3d 690 (C.A.3, 1998), which offers the better reasoned result. The rationale in Wicker allows the employer and the employee the freedom to negotiate and settle claims, but protects the employee from releasing the employer for unknown liability that was not considered and resolved in an informed manner. Here, the employee's doctor advised him that he was at risk of developing lung cancer and the employee negotiated, with the help of counsel, to settle that known risk, as well as existing injuries. Thus, pursuant to Wicker, the employee or his estate may not sue to recover for cancer because it was the very same risk for which the employee received settlement proceeds. Accordingly, we reverse the trial court's denial of summary disposition.

II. Facts

On August 9, 2004, John Jaqua filed a complaint under FELA for injuries he allegedly sustained while working for the defendant railroad. Jaqua specifically alleged that he contracted cancer because, during his 38 years as a railroad employee, he was exposed to asbestos and asbestos dust. Jaqua died of lung cancer on September 15, 2004, and the personal representative for his estate amended the complaint to assert a claim for wrongful death.¹

Defendant filed a motion for summary disposition and argued that plaintiff's claim is barred because, on December 4, 2002, Jaqua signed an agreement that released defendant from personal injury claims for occupational illnesses, including cancer. In response, plaintiff argued that the agreement is only valid to the extent it released claims for illnesses Jaqua suffered at the time he signed the agreement, which only included asbestosis, not cancer. The trial court agreed with plaintiff and denied defendant's motion.

The release provides, in relevant part:

WHEREAS, the Undersigned alleges that the Releasees were negligent and/or violated the Federal Employers Liability Act, among other things, in allowing an allegedly unsafe work condition to exist that the Undersigned alleges created an exposure or exposures to asbestos . . . or other agent. The Undersigned asserts that such exposure caused a condition, injury, disease and/or deficiency in the Undersigned including, but not limited to plaques, calcifications, thickening, asbestosis, silicosis, severe and permanent injuries to the lungs, respiratory system, nerves and/or nervous system, cancer, and any and all other conditions, diseases or injuries existing prior to the date of this Release Agreement which are known to the Undersigned or reasonably could have been known prior to the date of this Release Agreement and which may further develop in the future as a result of what now exists, arising from or as a result of the alleged exposures or which may further develop as a result of the Undersigned's current known conditions, which allegedly developed over time while working in the Grand Trunk Western Railroad Incorporated's employ.

* * *

The Undersigned declares and represents that the injuries and illnesses which have been sustained, including mental conditions, resulting from exposure to any substance, condition or environment or a belief that Undersigned was exposed to any substance, condition or environment are, or may be permanent, and that recovery therefrom is uncertain and indefinite and that they may cause or lead to other deleterious conditions. In making this Release, it is understood and agreed that the Undersigned relies wholly upon the Undersigned's own judgment, belief, and knowledge of the nature, extent, effect, duration, and other possible results of said illnesses, conditions, exposures, and liability therefore, and that this Release is made without reliance upon any statement or representation by Releasees or their representatives, the making of any such statements or representations being specifically denied.

* * *

WHEREAS, the Undersigned and Releasees wish to finally compromise all claims, demands, and liabilities which are known against each other for the above-referenced pulmonary conditions of Undersigned involving the alleged negligence and/or violation of the Federal Employers Liability Act of Releasees in their alleged failure to provide a reasonably safe workplace.

* * *

For the good and valuable consideration received under this Release and Settlement Agreement, receipt of which is hereby acknowledged, the Undersigned releases and forever discharges Releasees from any and all claims, demands, causes of action, obligations, damages and liabilities, arising in tort and/or under the Federal Employers Liability Act . . . .

* * *

IT IS FURTHER UNDERSTOOD AND AGREED that the pulmonary and/or respiratory injuries from which Undersigned allegedly suffers are of a kind and nature that the underlying pathology and/or symptoms might worsen in the future as the natural progression of this pathology or with normal aging, and the Undersigned is voluntarily accepting the risk of future worsening of his conditions and knowingly waives and releases any and all claims of the same. . . .

IT IS FURTHER UNDERSTOOD AND AGREED that this Release and Settlement Agreement is intended by the parties to release any and all existing claims for the injuries or conditions suffered or alleged to have been suffered as a result of the above-referenced exposures by the Undersigned as a result of the Undersigned's years of service with the Grand Trunk Western Railroad Incorporated, including any aggravation of any pre-existing condition or progression of any condition, known or which reasonably could have been known by the Undersigned.

Defendant contends, and we hold, that the release is enforceable as written and it bars plaintiff's claim for damages for Jaqua's cancer.

III. Analysis

A. Applicable Law: Federal Law Controls Under FELA

This case arises under FELA, and the validity of the release is controlled by federal law. As this Court explained in Boyt v. Grand Trunk W. R., 233 Mich. App. 179, 183, 592 N.W.2d 426 (1998):

In state courts, a review of a claim arising under the FELA is to be made in accordance with federal law. Norfolk & W. R. Co. v. Liepelt, 444 U.S. 490, 492, 100 S.Ct. 755, 62 L.Ed.2d 689 (1980); Blake v. Consolidated Rail Corp., 176 Mich.App. 506, 517, 439 N.W.2d 914 (1989). However, such a case is subject to state procedural rules.² Gortney v. Norfolk & W. R. Co., 216 Mich.App. 535, 538, 549 N.W.2d 612 (1996).

The parties dispute which federal circuit court decision governs this action. Specifically, the parties question whether this Court is required to follow the Sixth Circuit's opinion in Babbitt or whether it may follow a decision from another federal circuit. Our Supreme Court answered this question in Abela v. Gen. Motors Corp., 469 Mich. 603, 606, 677 N.W.2d 325 (2004):

Although state courts are bound by the decisions of the United States Supreme Court construing federal law Chesapeake & O R Co v. Martin, 283 U.S. 209, 220-221, 51 S.Ct. 453, 75 L.Ed. 983 (1931), there is no similar obligation with respect to decisions of the lower federal courts. Winget v. Grand Trunk W. R. Co., 210 Mich. 100, 117, 177 N.W. 273 177 NW2d [sic] 273 (1920).. See generally 21 CJS, Courts, § 159, pp. 195-197; 20 Am. Jur. 2d, Courts, § 171, pp. 454-455.

In other words, "[a]lthough lower federal court decisions may be persuasive, they are not binding on state courts." Abela, supra at 607, 677 N.W.2d 325.

Here, there are United States Supreme Court cases that address the legal issues presented by the parties, including the scope of FELA's § 5. Accordingly, this Court is bound to follow those rulings. However, this Court is not bound to follow a particular circuit's decision and may choose the view it determines to be most appropriate as long as it comports with...