Pearson v. Northeast Airlines, Inc.

Decision Date11 July 1962
Docket NumberNo. 297,Docket 27350.,297
PartiesMarilyn W. PEARSON, as Administratrix of the Goods, Chattels and Credits of John S. Pearson, Deceased, Plaintiff-Appellee, v. NORTHEAST AIRLINES, INC., Defendant-Appellant.
CourtU.S. Court of Appeals — Second Circuit


Haight, Gardner, Poor & Havens, New York City (William J. Junkerman and Douglas B. Bowring, New York City, of counsel) for defendant-appellant.

Frank G. Sterritte, and Speiser, Shumate, Geoghan & Law, New York City (Stuart M. Speiser and Florindo M. DeRosa, New York City, of counsel) for plaintiff-appellee.


Argued before the Panel April 11, 1962.

Panel Decision July 11, 1962.

Rehearing en Banc Ordered September 13, 1962.

Rehearing en Banc Decided November 8, 1962.

KAUFMAN, Circuit Judge, with whom CLARK, WATERMAN, SMITH, HAYS and MARSHALL, Circuit Judges, concur.

The principal question considered by this Court en banc is whether a federal court sitting in the state of New York may constitutionally "apply" a Massachusetts statute giving a cause of action for wrongful death and refuse, for reasons of state policy, to follow a provision of that statute which would limit the plaintiff's recovery to $15,000. The question arises in an action for wrongful death occasioned by a plane crash in Massachusetts. The action was brought in the United States District Court for the Southern District of New York, and was tried before Judge McGohey. The judge ruled that plaintiff's recovery was not bound by the arbitrary limit of $15,000 provided by Chapter 229, section 2, of the Massachusetts General Laws.1 In so doing he relied on the holding of the New York Court of Appeals, in Kilberg v. Northeast Airlines, Inc., 9 N.Y.2d 34, 211 N.Y.S.2d 133, 172 N.E.2d 526 (1961). The jury thereafter awarded damages well in excess of the statutory maximum and judgment was entered accordingly.2 From this adverse judgment, the defendant airline appealed to this Court, claiming, inter alia, that the recovery should have been limited, as a matter of law, in accordance with the Massachusetts statute. The appeal was first heard by a panel of this Court consisting of Chief Judge Lumbard, Judge Swan and this writer. A majority of that panel held, over my dissent, that the Full Faith and Credit Clause of the United States Constitution3 barred New York courts, and a federal court hearing an action brought in New York by virtue of diversity jurisdiction, from awarding unlimited recovery in a lawsuit "based" upon the Massachusetts statute.4 The issue being one of great significance — the constitutional power of the states to develop conflict of laws doctrine — it was ordered, upon application by the plaintiff-appellee and the affirmative vote of a majority of the active judges of this circuit, that the appeal be reheard en banc.5

As a consequence of this rehearing and extensive reconsideration of the issues and pertinent authorities, six active judges of this Court have reached a conclusion contrary to that of the majority of the original panel, and adopt this writer's dissent from the opinion of the panel, appearing at 307 F.2d 136 (1962). We hold that the ruling of the New York Court of Appeals in Kilberg was a proper exercise of the state's power to develop conflict of laws doctrine; and the court's refusal to apply the limitation of recovery provision in the Massachusetts statute a constitutional exercise of such power. The judgment of the District Court is therefore affirmed, as modified in accordance with the panel's unanimous holding on the issue of prejudgment interest. This issue requires no further discussion.6

Several additional considerations which we shall discuss, convince us that the conclusion we have reached is compelled.

The essential facts are not in dispute. Marilyn W. Pearson, widow and administratrix of the estate of John S. Pearson, and a citizen and domiciliary of New York, commenced the present action against Northeast Airlines, Inc. to recover damages for the death of her husband, allegedly caused by the defendant's negligence. Northeast Airlines is a Massachusetts corporation authorized to do business in New York. Pursuant to that authorization, it maintains ticket offices throughout the state, and actively promotes the use of its transportation facilities by New York citizens by means of widespread advertising. It operates a full schedule of flights from New York airports and earns a substantial amount of revenue from New York citizens. The decedent, a New York citizen and domiciliary, purchased his flight ticket at the New York offices of Northeast Airlines. He boarded the Northeast plane at La Guardia Airport, in the City of New York, bound for Nantucket Island, Massachusetts, and on the evening of August 15, 1958, the decedent's plane crashed in the vicinity of Nantucket.

Another action, having no connection with the Pearson family, had already been maintained in the courts of the State of New York by the administrator of Edward J. Kilberg, also a passenger on the same ill-fated flight to Nantucket.7 The highest court in New York ruled in that case that the action, by virtue of New York choice of law rules, was properly founded upon the liability created by the Massachusetts Wrongful Death Act. It stated, however, that New York courts should, if appropriate, award damages in excess of the statutory $15,000 maximum recovery required by the Massachusetts statute. Fundamental New York policy, given expression by a state constitutional provision prohibiting the New York legislature from enacting any such limitation, was held to prevent New York courts from applying the limitation by means of court-made law. The court emphasized that the limitation was deemed by the 1894 drafters of the state constitution to be "absurd and unjust, in measuring the pecuniary value of all lives, to the next of kin, by the same arbitrary standard."8 In effect, the Court of Appeals of the State of New York, in Kilberg, fashioned a rule of law allowing recovery of damages without arbitrary limit, modeled on the New York Wrongful Death Statute,9 although the Massachusetts statute still served as the foundation for plaintiff's cause of action for wrongful death. Judge McGohey, constrained by the edict of Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941), and Erie R. R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), properly applied the principles of New York conflict of laws enunciated in Kilberg and declined to recognize the Massachusetts limitation upon liability.

This writer has already criticized the argument apparently adopted by the panel opinion, that New York was constitutionally disabled from applying its own substantive rules of law to a cause of action arising out of a plane crash in Massachusetts. See dissent, 307 F.2d at 136. Although Judge Swan did not expressly approve this proposition of constitutional law, the inference seemed inescapable that, in effect, the panel majority had exalted the lex loci delictus to constitutional status with the consequence that New York was barred from applying the whole or any part of its own wrongful death policy to the events occurring in Nantucket.10 If this is indeed the rationale of the panel's opinion, then it is the first decision to "freeze" into constitutional mandate a choice-of-law rule derived from what may be described as the Ice Age of conflict of laws jurisprudence — at a time when that jurisprudence is in an advanced stage of thaw.11 A majority of this Court rejects this rationale for the same reasons which prompted this writer to reject it in his dissenting opinion.

It is suggested, however, that a different constitutional analysis supports the result reached by the panel. The proponents of this analysis are willing to assume that New York's "contacts" with the transaction are sufficient to support an application of New York's entire wrongful death statute to this accident although it occurred outside the territory of New York. In adopting this approach they would concede that the facts of this case — i. e., (a) Mr. Pearson's purchase of his airplane ticket at a New York office of a foreign corporation doing a large part of its business in New York; (b) his attempt to travel from New York, where he was domiciled, on a regularly scheduled flight most of which was conducted over New York; and (c) the New York domicile of his wife, administratrix and beneficiary under the Wrongful Death Act — are so closely related to the State of New York that it would have the constitutional power to apply its own wrongful death law to this litigation. However, the proponents of this constitutional analysis would deem it contrary to the mandate of the Full Faith and Credit Clause if New York were to entertain a claim for wrongful death "under" the Massachusetts act but apply New York principles governing the exent of permitted recovery. In summary, they urge that once a New York court recognizes a claim for wrongful death based on Massachusetts law, that law must control every incident of the claim. They argue that New York is not required to give any faith or credit to the Massachusetts act, but once it gives Massachusetts law some faith and credit it must also give it full faith and credit.

We find this construction of the constitutional mandate untenable. Despite the resourceful arguments put forth in its behalf, we are not persuaded that a statutory limitation upon the amount of money that may be recovered should merit any greater obeisance than statutory limitations addressed to the length of time during which the action may be brought, or to the parties who are empowered to bring that suit, or to...

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