Lau v. Nelson, 46074

• Decision Date: 18 October 1979
• Docket Number: No. 46074,46074
• Parties: Lelan M. LAU, as Administrator of the Estate of Vivian Arlene Lau, Deceased, Appellant, v. Ray NELSON, and Jane Doe Nelson, his wife, d/b/a Nelson Brothers; and Eugene Magnochi and Jane Doe Magnochi, his wife, Respondents, Donald G. Casper and Jane Doe Casper, his wife, Defendants.
• Court: Washington Supreme Court

Page 823

92 Wn.2d 823

601 P.2d 527

Lelan M. LAU, as Administrator of the Estate of Vivian

Arlene Lau, Deceased, Appellant, v. Ray NELSON, and Jane Doe Nelson, his wife, d/b/a Nelson

Brothers; and Eugene Magnochi and Jane Doe

Magnochi, his wife, Respondents,

Donald G. Casper and Jane Doe Casper, his wife, Defendants.

No. 46074.

Supreme Court of Washington, En Banc.

Oct. 18, 1979.

Young, Cole, Gathe, Inc., P.S., Richard T. Cole, Nelvin W. Bettis, Seattle, for appellant.

Merrick, Hofstedt & Lindsey, H. J. Merrick, Sidney R. Snyder, Jr., Murray, Dunham & Waitt, Wayne Murray, Seattle, for respondents.

ROSELLINI, Justice.

This is a wrongful death action brought against the driver of a truck in which the deceased was a passenger, and against the alleged owner of the vehicle. The accident occurred before the repeal of the State's host-guest statute (Laws of 1974, 1st Ex. Sess., ch. 3, p. 2; former RCW 46.08.080) but had not gone to trial before the effective date of that repeal. On the day scheduled for trial, the plaintiff sought a declaration and order that the repeal was retroactive. The court's denial of that motion, based upon its holding that the law was not intended to apply retroactively, was brought to this court upon the granting of discretionary review, where it was affirmed upon a different ground. Lau v. Nelson, 89 Wash.2d 772, 575 P.2d 719 (1978). This court held that the law, being a repealing act, was intended to operate retroactively; that its effect was to reinstate the rule at common law with respect to the duties of a host driver, and that that rule required proof of gross negligence before a guest could recover. We stated that the rule might be unduly harsh but declined to abandon it, since the petitioner had not attempted to establish its invalidity, and full argument and presentation of relevant facts would be required if it was to be reconsidered. ¹ The case was remanded with directions to apply the rule of gross negligence, the common law in this state.

The trial was conducted accordingly. After the jury had returned its verdict in favor of both defendants and judgment had been entered, this court decided the case of Roberts v. Johnson, 91 Wash.2d 182, 588 P.2d 201 (1978), wherein we abandoned the rule requiring proof of gross negligence and held that the duty of a host driver is that of exercising ordinary care. In Roberts, the plaintiff had challenged the common law rule in the trial court, in opposing the defendant's motion for summary judgment. The trial court had quite properly refused to usurp the appellate function by changing the rule and therefore granted the motion for summary judgment, there being no evidence of gross negligence. In this court the question was vigorously argued, both by counsel and by amici curiae representing proponents on either side.

The question whether retroactive application should be given to the new rule was not raised in that case and was not decided, although the plaintiffs were given the benefit of the change in rule. It is the general practice to afford the benefits of a rule change to the party whose efforts have convinced the court that the change should take place, even though the decision may otherwise operate only prospectively. See Taskett v. KING Broadcasting Co., 86 Wash.2d 439, 546 P.2d 81 (1976), and the cases cited therein, and the annotation in 10 A.L.R.3d 1371 (1966), Comment Note. Prospective or Retroactive Operation of Overruling Decision. The term "retroactive application" was not delineated in the Taskett case, but the context, the decision, and the cited cases make it apparent that retroactivity with respect to the case before the court was the only issue under consideration. While retroactive application to the overruling case is the general rule, there are cases in which the equities of a party are so strong that the decision will not be applied in his case. An example is Cascade Security Bank v. Butler, 88 Wash.2d 777, 567 P.2d 631 (1977), wherein this court, changing the common law so as to make a vendee's interest in real property vulnerable to liens, held the change inapplicable in the case before it because of its inequitable impact on a purchaser who had acquired a vendee's interest in good faith and for value.

The question before us on this appeal is whether the change in the common law rule should apply to this case, in which event a new trial would be required.

In considering whether a statute shall be given prospective or retroactive effect, as in the earlier appeal of this case, the object of the court is to ascertain the legislative intent, and principles of statutory construction must guide the decision. But when the question is whether an overruling case should be applied to cases arising prior to the decision, the question is one which rests in the discretion of the court which renders that decision.

In exercising that discretion, the courts have taken into account various factors affecting the question. With regard to the application of a change in the law of tort liability, the significant factors to be considered are set forth in Vaughn v. Murray, 214 Kan. 456, 521 P.2d 262 (1974). In that case, the Kansas Supreme Court decided that a decision holding unconstitutional the state's host-guest statute should not apply to error-free cases which had gone to judgment prior to the date of the decision, unless the constitutional question had been timely presented to the trial court.

The factors to be considered are:

(1) Justifiable reliance on the earlier law; (2) The nature and purpose of the overruling decision; (3) Res judicata (4) Vested rights, if any, which may have accrued by reason of the earlier law; and (5) The effective retroactive application may have on the administration of justice in the courts.

Vaughn, at 464, 521 P.2d at 269.

The court also noted, citing sections 12, 13, 22 and 32 of the annotation in 10 A.L.R.3d 1420, 1423, 1434 and 1444, that the procedural and substantive aspects of an overruling decision are often so intertwined that most of the modern cases make no distinction between the two so far as retroactive or prospective application is concerned. As further pointed out in that case, where a decision with respect to retroactivity is made, there are several choices before the court. These are:

(1) Purely prospective application where the law declared will not even apply to the parties to the overruling case; (See cases collected in 10 A.L.R.3d, § 7, p. 1393 (State ex rel. Finance Comm. v. Martin, 62 Wash.2d 645, 384 P.2d 833 (1963); Cf., Cascade Security Bank v. Butler, 88 Wash.2d 777, 567 P.2d 631 (1977)). (2) Limited retroactive effect where the law declared will govern the rights of the parties to the overruling case but in all other cases will be applied prospectively; (See . . . cases collected in 10 A.L.R.3d, § 8(b), p. 1399.) (3) General retroactive effect governing the rights of the parties to the overruling case and to all pending and future cases unless further litigation is barred by statutes of limitation or jurisdictional rules of appellate procedure; (See cases collected in 10 A.L.R.3d, § 8(e), pp. 1407-1412 (Haines v. Anaconda Aluminum Co., 87 Wash.2d 28, 549 P.2d 13 (1976)).) and (4) Retroactive effect governing the rights of the parties to the overruling case and to other cases pending when the overruling case was decided and all future cases, but limited so the new law will not govern the rights of parties to cases terminated by a judgment or verdict before the overruling decision was announced. (See . . . cases collected in 10 A.L.R.3d, § 8(c, d), pp. 1401-1407.)

Vaughn, at 465-66, 521 P.2d at 270-71.

The Kansas court, and rightly we think, attached much significance to the impact of the new decision upon litigants and the trial courts, and to the desirability of giving finality to those cases which have gone to judgment in error-free trials under the existing law. We consider those factors determinative here. It is true that, as the appellant points out, it cannot realistically be said that a person behaving negligently does so in reliance upon a rule of law which protects him in that negligence, particularly when he is operating such a dangerous instrumentality as an automobile. On the other hand, when a negligence case goes to trial, the parties and the court have a reasonable expectation that the law as it exists at that time will apply to the proceedings, and they should be justified in governing their actions accordingly.

A second trial is an expensive and time-consuming undertaking, and the outcome is seldom certain. In the present case, the appellant makes only a slight showing of negligence on the part of the respondent driver, and it is problematic that a jury would find him guilty of even ordinary negligence. It would be unfair to the respondents, who have already been required to defend two appeals, to subject them to further litigation in this matter. We believe that, where retroactivity is at issue, interests involved in the administration of justice outweigh the interests of plaintiffs in enjoying the new rights accorded in Roberts v. Johnson, supra. Accordingly, the decision will be applicable to ...