Leonard v. Johns-Manville Sales Corp., JOHNS-MANVILLE

• Decision Date: 09 August 1983
• Docket Number: JOHNS-MANVILLE,No. 697PA82,697PA82
• Citation: 309 N.C. 91,305 S.E.2d 528
• Court: North Carolina Supreme Court
• Parties: Marie R. LEONARD, Administratrix of the Estate of Samuel L. Leonard, Deceased v.SALES CORPORATION, et al.

Page 528

305 S.E.2d 528

309 N.C. 91

Marie R. LEONARD, Administratrix of the Estate of Samuel L Leonard, Deceased v. JOHNS-MANVILLE SALES CORPORATION, et al.

No. 697PA82.

Supreme Court of North Carolina.

Aug. 9, 1983.

Smith, Moore, Smith, Schell & Hunter by McNeill Smith and Gerard H. Davidson, Jr., Greensboro, Battle, Winslow, Scott & Wiley, P.A. by Marshall A. Gallop, Jr., Rocky Mount, Brown & Johnson by C.K. Brown, Jr., Raleigh, Wallace Barwick & Landis, P.A. by Fitzhugh E. Wallace, Kinston, Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan by James G. Billings and Thomas N. Barefoot, Raleigh, Bryant, Drew, Crill & Patterson, by Victor S. Bryant, Jr., Durham, and Poisson, Barnhill & Britt by Donald E. Britt, Jr., Wilmington, for defendants-appellants.

Young, Moore, Henderson & Alvis, P.A. by Edward B. Clark and B.T. Henderson II, Raleigh, for Stone & Webster Engineering Corp.

Haywood, Denny & Miller by George W. Miller, Jr., Durham, and Michael W. Patrick, Chapel Hill, for plaintiff, amicus curiae.

MARTIN, Justice.

The issue we must decide is whether in this North Carolina wrongful death action defendant manufacturers are entitled to amend their answers to allege as a pro tanto defense the concurring negligence of decedent's employer who had paid a Virginia workers' compensation claim arising from the asbestosis which ultimately caused decedent's death. For reasons stated below, we hold that defendants in this case may allege as a defense the concurring negligence of decedent's employer.

Traditionally, this court has held that when the injury giving rise to a negligence claim occurs in another state, the law of that state will govern resolution of the substantive issues in the controversy. E.g., Thames v. Teer Co., 267 N.C. 565, 148 S.E.2d 527 (1966); McCombs v. Trucking Co. and Miller v. Trucking Company, 252 N.C. 699, 114 S.E.2d 683 (1960); Childress v. Motor Lines, 235 N.C. 522, 70 S.E.2d 558 (1952); Charnock v. Taylor, 223 N.C. 360, 26 S.E.2d 911 (1943); Chewning v. Chewning, 20 N.C.App. 283, 201 S.E.2d 353 (1973); Williams v. General Motors Corp., 19 N.C.App. 337, 198 S.E.2d 766, cert. denied, 284 N.C. 258, 200 S.E.2d 659 (1973). N.C.G.S. 8-4 authorizes our courts to "take notice of such law in the same manner as if the question arose under the law of this State." Thames v. Teer Co., supra. The party seeking to have the law of a foreign jurisdiction apply has the burden of bringing such law to the attention of the court. If the foreign jurisdiction has no law, either statutory or decisional, on the question involved, the courts of this state will not speculate what law such jurisdiction might adopt and will apply the law of North Carolina.

In the present case, Stone & Webster argues that because the place of decedent's injury was in Virginia, the law of Virginia should apply and Virginia law would not permit it to be brought into this litigation for any purpose. Virginia does not have a statute permitting or prohibiting a third party sued in tort by an employee to allege as a pro tanto defense the negligence of an employer who has paid workers' compensation to the employee for the injury. Cf. N.C.Gen.Stat. § 97-10.2(e) (1979). Like North Carolina, however, Virginia does not permit defendants in an employee's tort suit to join an employer as a party defendant based on a claim that the employer is a joint tort-feasor if the employer has paid workers' compensation for the injury sued upon. Virginia Elec. & Power Co. v. Wilson, 221 Va. 979, 277 S.E.2d 149 (1981) (cited hereafter as "Vepco"). See, e.g., Hunsucker v. Chair Co., 237 N.C. 559, 75 S.E.2d 768 (1953). In Vepco, Virginia Electric and Power Company was sued in tort by employees of K.F. Wilson for damages for personal injuries allegedly caused by a gas main explosion. K.F. Wilson had paid workers' compensation to these employees, and the power company sought to implead Wilson in the personal injury suit for contribution or indemnity on the theory that Wilson was a joint tort-feasor. The Supreme Court of Virginia affirmed dismissal of Wilson as a third-party defendant, holding that because plaintiff had no right of action in tort against Wilson, the power company could not implead Wilson for contribution or indemnity. See Va.Code §§ 8.01-34, 65.1-40 (1980); Fauver v. Bell, 192 Va. 518, 65 S.E.2d 575 (1951). See also Jennings v. Franz Torwegge Machine Works, 347 F.Supp. 1288 (W.D.Va.1972).

However, neither our own research nor that of Stone & Webster has revealed any Virginia case either permitting or prohibiting third parties to raise the employer's negligence as a pro tanto defense in a suit such as the instant one. Stone & Webster urges this Court to read the Vepco decision, supra, as an indication that the Supreme Court of Virginia would not allow Stone & Webster to be brought into this suit for any purpose. We decline to engage in such speculation. If this case were before it, the Supreme Court of Virginia might very well allow Stone & Webster to be brought into this suit for the limited purpose argued by defendants, while refusing to allow it to be impleaded as a joint tort-feasor. Cf. Brown v. R.R., 204 N.C. 668, 169 S.E. 419 (1933) ("Brown II"). In the absence of any Virginia law one way or the other on this issue, the rule of lex loci delicti commissi does not apply. Instead, we hold that North Carolina law applies. ¹ We now explain what that law is.

If Mr. Leonard had been awarded workers' compensation under the North Carolina Workers' Compensation Act, then in this tort action defendants would have been able to bring decedent's employer into the suit for limited purposes by alleging that the employer's contributory negligence was a cause of decedent's injuries. N.C.G.S. 97-10.2 provides in pertinent part as follows:

(a) The right to compensation and other benefits under this Article for disability, disfigurement, or death shall not be affected by the fact that the injury or death was caused under circumstances creating a liability in some person other than the employer to pay damages therefor, such person hereinafter being referred to as the "third party." The respective rights and interests of the employee-beneficiary under this Article, the employer, and the employer's insurance carrier, if any, in respect of the common-law cause of action against such third party and the damages recovered shall be as set forth in this section.

(b) The employee, or his personal representative if he be dead, shall have the exclusive right to proceed to enforce the liability of the third party by appropriate proceedings if such proceedings are instituted not later than 12 months after the date of injury or death, whichever is later....

....

(e) The amount of compensation and other benefits paid or payable on account to [sic ] such injury or death shall not be admissible in evidence in any proceeding against the third party. If the third party defending such proceeding, by answer duly served on the employer, sufficiently alleges that actionable negligence of the employer joined and concurred with the negligence of the third party in producing the injury or death, then an issue shall be submitted to the jury in such case as to whether actionable negligence of the employer joined and concurred with the negligence of the third party in producing the injury or death. The employer shall have the right to appear, to be represented, to introduce evidence, to cross-examine adverse witnesses, and to argue to the jury as to this issue as fully as though he were a party although not named or joined as a party to the proceeding. Such issue shall be the last of the issues submitted to the jury. If the verdict shall be that actionable negligence of the employer did join and concur with that of the third party in producing the injury or death, then the court shall reduce the damages awarded by the jury against the third party by the amount which the employer would otherwise be entitled to receive therefrom by way of subrogation hereunder and the entire amount recovered, after such reduction, shall belong to the employee or his personal representative free of any claim by the employer and the third party shall have no further right by way of contribution or otherwise against the employer, except any right which may exist by reason of an express contract of indemnity between the employer and the third party, which was entered into prior to the injury to the employee.

N.C.Gen.Stat. § 97-10.2(a), (b), (e) (1979). However, because in this case neither decedent nor his administratrix recovered workers' compensation under the North Carolina act, N.C.G.S. 97-10.2(e) does not control. N.C.Gen.Stat. § 97-10.2(a) (1979). Nevertheless, we find that the policy and reasoning behind this statute apply equally to the facts in the present case and thus defendants may allege the contributory negligence of Stone & Webster as a defense for the same limited purposes and by the same procedure set forth in N.C.G.S. 97-10.2.

The procedure provided for in N.C.G.S. 97-10.2(e) was created judicially in Brown II, supra, 204 N.C. 668, 169 S.E. 419. In that case plaintiff's intestate was driving a truck in the employ of Chero-Cola Bottling Company ("Chero-Cola") when he was struck and killed by a train owned by defendant, Southern Railway Company ("Railway"). Chero-Cola paid decedent's administrator workers' compensation and this administrator then instituted a wrongful death action against Southern Railway. Under the workers' compensation statute in effect at the time, an employer who had paid workers' compensation was entitled to be subrogated pro tanto to the employee's right to recover damages from a third party whose negligence caused the employee's injury:

The acceptance of an award under [the Workmen's Compensation Act] against an employer for compensation for the injury or death of an employee shall operate as an assignment to the employer of any right to...