Pearson v. Northeast Airlines, Inc., 297

Citation307 F.2d 131
Decision Date11 July 1962
Docket NumberDocket 27350.,No. 297,297
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, for appellant. William J. Junkerman and Douglas B. Bowring, New York City, of counsel.

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.

Before LUMBARD, Chief Judge, and SWAN and KAUFMAN, Circuit Judges.

SWAN, Circuit Judge.

This appeal involves litigation which resulted from the crash, on August 15, 1958, of appellant's airplane on Nantucket Island. Mrs. Pearson as administratrix of her deceased husband's estate brought suit in the Southern District of New York, federal jurisdiction resting on diversity of citizenship, she being a citizen of New York and defendant a Massachusetts corporation. Her complaint alleged seven causes of action,1 but there remains for consideration on the appeal only the cause of action based on the Massachusetts wrongful death act, which limits recovery to $15,000, and certain orders of the trial court denying defendant's motions (a) to dismiss the complaint insofar as it sought damages for wrongful death in excess of $15,000, (b) for a directed verdict for plaintiff in the amount of $15,000, (c) for judgment non obstante veredicto in the limited amount of $15,000, and (d) for an order striking out that portion of the judgment which awarded plaintiff interest from the date of death, August 15, 1958, to the date of judgment, November 16, 1961, amounting to $26,106.88.

In denying defendant's motions to limit recovery to the maximum permitted under the Massachusetts wrongful death act,2 Judge McGohey ruled that he was obliged to apply a dictum 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 to the effect that the Massachusetts limitation would not be enforced against a New York citizen suing in a New York court.3 He also ruled that the damages should be measured not by "the degree of culpability of defendant," as required by the Massachusetts statute, but "by New York's standard of the pecuniary damage resulting to the beneficiaries from the death." Judge McGohey's opinion is reported at 199 F.Supp. 539. Later, in denying defendant's motion to strike prejudgment interest, he wrote a memorandum decision and order reported at D.C., 201 F.Supp. 45.

From these rulings of the trial court the defendant has appealed. It is not contended that in refusing to enforce the Massachusetts limitation of $15,000 Judge McGohey misconstrued the Kilberg dictum. It is contended that such ruling violates the full faith and credit clause and the due process clause of the United States Constitution. With respect to the rulings on the measure of damages and on pre-judgment interest appellant contends that the trial court did misconstrue the New York law, or, if he correctly construed it, that the New York law is similarly unconstitutional. For reversal of the ruling as to pre-judgment interest reliance is also placed on a decision of the Appellate Division, First Department, made subsequent to Judge McGohey's decision of December 15, 1961.3a

Appellant devotes some ten pages of its brief to criticism of the Kilberg dictum in the endeavor to show that it "represents not only an ill-advised excursion into the field of advisory opinions, but a misconception (at least) of the earlier New York law and bad law in itself," and notes that three judges of the Court of Appeals stated in vigorous terms that the majority had no "warrant or justification" for going beyond the issue decided. We think it inappropriate for this court to discuss the wisdom or the soundness of the majority's dictum, and there is no necessity of our doing so. Consequently we pass at once to a discussion of the appeal.

Since federal jurisdiction rests on diversity, it is clear that Judge McGohey was obliged to apply the law of the State of New York, Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, including its conflict of laws doctrine, Klaxton Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477, unless some provision of the Constitution of the United States precludes its application. On the main issue, limitation of liability, appellant contends that application of the dictum violates the full faith and credit clause, while appellee contends that this provision does not preclude a State from applying its own conflict of laws rule.

A majority of the court holds, Judge Kaufman dissenting, that the trial court's refusal to apply the $15,000 limitation of the Massachusetts statute violates the Full Faith and Credit Clause of the Constitution. (Art. IV, section 1.)4 In denying the motion to strike out pre-judgment interest, we are all agreed that the trial court erred.

The purpose of the full faith and credit clause of the Constitution, as briefly explained in Sherrer v. Sherrer, 334 U.S. 343, 355, 68 S.Ct. 1087, 1097, 92 L. Ed. 1429, was to transform an aggregate of independent sovereign states into a nation. "If in its application local policy must at times be required to give way, `such is part of the price of our federal system.' * * *" citation omitted. To like effect is Estin v. Estin, 334 U.S. 541, 545-546, 68 S.Ct. 1213, 92 L.Ed. 1561. Neither of these cases was an action for wrongful death. The conflict between a foreign wrongful death action and a statute of the forum has been considered by the Supreme Court in three cases: Hughes v. Fetter, 341 U.S. 609, 71 S.Ct. 980, 95 L.Ed. 1212; First National Bank of Chicago v. United Air Lines, 342 U.S. 396, 72 S.Ct. 421, 96 L. Ed. 441; Wells v. Simonds Abrasive Co., 345 U.S. 514, 73 S.Ct. 856, 97 L.Ed. 1211. Appellant relies upon the first two; appellee upon the last.

In Hughes the highest court of Wisconsin affirmed the dismissal of an action brought under the wrongful death statute of Illinois on the ground that a Wisconsin statute had been construed by its courts as establishing a local public policy against entertaining suits brought under wrongful death statutes of other States. This was reversed by the Supreme Court as a violation of the full faith and credit clause, Mr. Justice Black, who wrote the majority opinion, stating at pages 611-612 of 341 U.S., at page 982 of 71 S.Ct.:

"* * * We have recognized, however, that full faith and credit does not automatically compel a forum state to subordinate its own statutory policy to a conflicting public act of another state; rather, it is for this Court to choose in each case between the competing public policies involved. The clash of interests in cases of this type has usually been described as a conflict between the public policies of two or more states. The more basic conflict involved in the present appeal, however, is as follows: On the one hand is the strong unifying principle embodied in the Full Faith and Credit Clause looking toward maximum enforcement in each state of the obligations created or recognized by the statutes of sister states; on the other hand is the policy of Wisconsin, as interpreted by its highest court, against permitting Wisconsin courts to entertain this wrongful death action.
"We hold that Wisconsin\'s policy must give way. That state has no real feeling of antagonism against wrongful death suits in general. * * *"

As in Hughes, the present appeal involves the same "more basic conflict" — a conflict between "the strong unifying principle embodied in the Full Faith and Credit Clause" and the public policy of New York expressed in the Kilberg dictum. It is likewise true that New York has no antagonism to wrongful death actions in general. Its antagonism is only to the limitation of liability. Its own statute has no limitation but the opinion recognizes that plaintiff's rights arise under the Massachusetts statute, not the New York statute.5 The Supreme Court is the final authority to choose "between the competing public policies involved." But on the present appeal this court must make the choice. This court believes that the "strong, unifying principle" of the full faith and credit clause should prevail.

In the First National Bank case the suit was brought in a federal district court in Illinois, on grounds of diversity of citizenship, to recover under the Utah wrongful death statute for a death which occurred in Utah. As required by an Illinois statute, the trial court dismissed the suit, and the Court of Appeals affirmed, 7 Cir., 190 F.2d 493. But the Supreme Court held the statute invalid under the full faith and credit clause of the Constitution. In a concurring opinion Mr. Justice Jackson wrote at page 400 of 342 U.S., at page 423 of 72 S.Ct.:

"For the essence of the Full Faith and Credit Clause is that certain transactions, wherever in the United States they may be litigated, shall have the same legal consequences as they would have in the place where they occurred. Citations omitted.
"There is undoubtedly some area of freedom for state conflicts law outside the requirements of the Full Faith and Credit Clause. In such matters, unreached by constitutional law, the state rule would prevail in a diversity court. Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487 61 S.Ct. 1020, 85 L.Ed. 1477. But if a transaction is so associated with one jurisdiction that the Constitution compels any forum in which the transaction is litigated to apply the law of that jurisdiction, is it not the Constitution instead of state conflicts law which determines what law the federal court shall apply?"

That the answer to this question should be "yes" is the belief of a majority of this court.

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