N-500L Cases, In re, N-500L

Citation691 F.2d 15
Decision Date28 September 1982
Docket NumberNo. 81-1446,N-500L,81-1446
PartiesIn reCASES. Cornhill Insurance Company Ltd., and Corporacion Insular De Seguros, Defendants-Third Party Defendants-Appellants. Eastern Airlines, Inc., Defendant-Third Party Plaintiff-Cross Claimant- Appellee. United States of America, Defendant-Appellee.
CourtUnited States Courts of Appeals. United States Court of Appeals (1st Circuit)

John M. Harrington, Jr., with whom Kenneth W. Erickson, Thomas H. Hannigan, Jr., Ropes & Gray, Boston, Mass., Francisco Agrait Oliveras, and Agrait & Oliveras, Hato Rey, P. R., were on brief, for defendants-third party defendants appellants.

Carolyn A. Pickard, with whom Richard J. Thornton, Calvin F. David, and Thornton, David & Murray, P. A., Miami, Fla., were on brief, for Eastern Airlines, Inc., defendant-third party plaintiff-cross claimant-appellee.

Phillip J. Kolczynski, Aviation Trial Atty., Torts Branch, Civil Division, United States Dept. of Justice, Washington, D. C., with whom J. Paul McGrath, Asst. Atty. Gen., Washington, D. C., and William F. Weld, U. S. Atty., Boston, were on brief for the United States of America, defendant-appellee.

Before CAMPBELL and BOWNES, Circuit Judges and PETTINE, * District Judge.

BOWNES, Circuit Judge.

This case arises out of a 1978 crash in San Juan, Puerto Rico. A twin-propeller aircraft, bearing the identification number N-500L (N-500L), was on approach for landing at San Juan International Airport when it was overtaken by an Eastern Airlines L-1011 jumbo jet (L-1011) which was also in the process of landing. It was stipulated that wake turbulence generated by the L-1011 caused the N-500L to crash, killing all six persons aboard and causing substantial injury to persons and property on the ground.

In all, twenty-six tort actions and several third-party claims for contribution 1 were filed and thereafter consolidated. The defendants were Eastern Airlines (Eastern); Federal Aviation Administration air traffic controllers (Government); Air Caribbean, operator of the N-500L; Francisco Cruz, owner of the N-500L; Cornhill Insurance Company Ltd., representing underwriters in the London market and liability insurers for Air Caribbean (Cornhill); and Corporacion Insular De Seguros, liability insurer for Cruz (Corporacion). 2

Plaintiffs had requested a jury trial in all cases. 3 On the eve of trial, after settlement negotiations with the plaintiffs, Eastern and Government agreed to assume all liability, reserving their rights to seek contribution from N-500L, Air Caribbean, Cornhill and Corporacion. Eastern and the Government agreed on a settlement of $5,690,000 with the plaintiffs and an order of settlement was entered by the court in that amount. Cornhill and Corporacion, although agreeing not to dispute the reasonableness of the amount, did not admit liability or participate in the settlement negotiations.

Eastern and the Government then moved for a nonjury trial on their contribution claims. Cornhill and Corporacion objected, claiming that they had justifiably relied on the original plaintiffs' jury demands. 4 In a written decision the district court granted the motion and ordered a nonjury trial on the proportionate liability of N-500L, the Government and Eastern, holding that appellants had waived their rights to a jury trial. In re N-500L Cases, 517 F.Supp. 821 (D.P.R.1981).

After a fourteen-day trial, the district court found that the pilot of N-500L was negligent and his negligence was a proximate and contributing cause of the plaintiffs' injuries and assessed proportionate liability at 60% to N-500L, 20% to the Government and 20% to Eastern. Judgment was entered against Cornhill and Corporacion jointly and severally. In re N-500L Cases, 517 F.Supp. 825 (D.P.R.1981).

There are two basic issues: whether appellants had a right to a jury trial and whether the district court erred in its findings of fault and allocation of liability.

I. RIGHT TO JURY TRIAL

The seventh amendment provides in relevant part, "In suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved(.)"

The phrase "common law," found in this clause is used in contradistinction to equity, and admiralty, and maritime jurisprudence.... By common law they meant what the Constitution denominated in the third article "law;" not merely suits, which the common law recognized among its old and settled proceedings, but suits in which legal rights were to be ascertained and determined, in contradistinction to those where equitable rights alone were recognized, and equitable remedies were administered .... In a just sense, the amendment, then, may be construed to embrace all suits which are not of equity and admiralty jurisdiction, whatever may be the peculiar form which they may assume to settle legal rights.

Parsons v. Bedford, 28 U.S. (3 Pet.) 433, 446, 7 L.Ed. 732 (1830).

Although the amendment has historically been held to preserve the right to jury trial as it existed in England when the amendment was adopted in 1791, Baltimore & Carolina Line, Inc. v. Redman, 295 U.S. 654, 657, 55 S.Ct. 890, 891, 79 L.Ed. 1636 (1935); 5 Moore's Federal Practice P 38.08(5) (2d ed. 1980), "it has long been settled that the right extends beyond the common law forms of action recognized at that time." Curtis v. Loether, 415 U.S. 189, 193, 94 S.Ct. 1005, 1007, 39 L.Ed.2d 260 (1974).

Whether or not a close equivalent (to a modern cause of action) existed in England in 1791 is irrelevant for Seventh Amendment purposes, for that Amendment requires trial by jury in actions unheard of at common law, provided that the action involves rights and remedies of the sort traditionally enforced in an action at law, rather than in an action in equity or admiralty.

Pernell v. Southall Realty, 416 U.S. 363, 375, 94 S.Ct. 1723, 1729, 40 L.Ed.2d 198 (1974).

In Ross v. Bernhard, 396 U.S. 531, 90 S.Ct. 733, 24 L.Ed.2d 729 (1970), the Supreme Court held that the right to a jury trial is not dependent on the character of the overall action but rather is to be determined by looking to the nature of the issue to be tried. Id. at 538, 90 S.Ct. at 738. There is thus a right to jury trial on an issue if that issue involves the adjudication of traditional legal rights and remedies. See Pernell, 416 U.S. at 375, 94 S.Ct. at 1729.

Appellees argue that the only issue remaining in the case is contribution, which they claim is a right in equity, not law. Appellants characterize the remaining cause of action as contribution but claim that the issues to be tried are the negligence of their insureds, their proportionate fault, if any, relative to appellees and their resultant liability in damages. They also dispute the contention that contribution is an equitable rather than a legal cause of action.

Where, as here, a state-created claim is involved, the characterization of an issue as "legal" and thus entitling a party to a jury trial is determined as a matter of federal law. Simler v. Conner, 372 U.S. 221, 222, 83 S.Ct. 609, 610, 9 L.Ed.2d 691 (1963). 5 We have found wide disagreement among the federal courts that have considered whether contribution is a legal or equitable claim. The only court of appeals to specifically hold that contribution is a right enforceable only in equity is the D. C. Circuit. See Dawson v. Contractors Transport Corp., 467 F.2d 727 (D.C.Cir.1972); 6 Jones v. Schramm, 436 F.2d 899 (D.C.Cir.1970). Other courts, including this court, that call contribution an equitable doctrine use the term in its sense of fairness and justice and do not address the jury trial question. See Professional Beauty Supply, Inc. v. National Beauty Supply, Inc., 594 F.2d 1179, 1185 (8th Cir. 1979); Newport Air Park, Inc. v. United States, 419 F.2d 342, 344 (1st Cir. 1969); Huggins v. Graves, 337 F.2d 486, 489 (6th Cir. 1964); Vickers Petroleum Co. v. Biffle, 239 F.2d 602, 606 (10th Cir. 1956); Kittleson v. American Dist. Telegraph Co., 81 F.Supp. 25, 30 (N.D.Iowa 1948), rev'd on other grounds, 179 F.2d 946 (8th Cir. 1950). And still other federal cases expressly hold that contribution, although deriving from equitable principles of fairness, is a legal right arising out of the tort and enforceable in an action at law. Brandt v. Olson, 190 F.Supp. 683, 686-87 (N.D.Iowa 1961); Globig v. Greene & Gust Co., 184 F.Supp. 530, 534 (E.D.Wis.1960). 7

The most recent decision directly addressing the question whether a claim for contribution gives rise to a right to jury trial is Palmer v. United States, 652 F.2d 893 (9th Cir. 1981). Palmer was injured as a result of being struck by a car driven by a government employee. Fisher, whose car had previously collided with another car, had left the scene of the accident and Palmer was standing in the road directing traffic around Fisher's disabled vehicle when he was hit. Palmer sued the government seeking damages for negligence and the government impleaded Fisher as a third-party defendant, claiming a right of contribution under the California doctrine of partial comparative indemnity. Despite jury demands of the plaintiff and third-party defendant, trial was to the court, and Fisher appealed after being held 70% liable in contribution.

The court of appeals held that the third-party defendant had a right to a jury trial on the issue of his liability to the third-party plaintiff for contribution. 8 The government had argued, as appellees do here, that contribution is an equitable doctrine with no right to a jury. But the court, drawing on the Supreme Court's analysis in Ross v. Bernhard, 396 U.S. 531, 90 S.Ct. 733, 24 L.Ed.2d 729, looked to the "nature of the issue to be tried" to determine its character and noted that an issue is legal "when its resolution involves the ascertainment and determination of legal rights or justifies a remedy traditionally granted by common law courts." 652 F.2d at 895 (citations omitted). Following Ross and apparently...

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