Reinan v. Pacific Motor Trucking Co.

• Decision Date: 17 October 1974
• Citation: 270 Or. 208,527 P.2d 256
• Parties: Tommy L. REINAN, Appellant, v. PACIFIC MOTOR TRUCKING COMPANY, a California corporation, Respondent.
• Court: Oregon Supreme Court

Page 256

527 P.2d 256

270 Or. 208

Tommy L. REINAN, Appellant, v. PACIFIC MOTOR TRUCKING COMPANY, a California corporation, Respondent.

Supreme Court of Oregon.

Argued and Submitted Sept. 9, 1974.

Decided Oct. 17, 1974.

Donald A. Buss, Portland, argued the cause for appellant. With him on the briefs were Buss, Leichner, Lindstedt, Barker & Buono, Portland.

James H. Clarke, Portland, argued the cause for respondent. With him on the brief were Dezendorf, Spears, Lubersky & Campbell and Laurence F. Janssen, Portland.

Before O'CONNELL, C.J., and McALLISTER, HOLMAN, TONGUE, HOWELL and SLOPER, JJ.

SLOPER, Justice (Pro Tem.).

This is an ction for personal injuries sustained in an automobile-truck collision in which plaintiff's car was struck by defendant's truck as it was passing on the truck's right-hand side and as the car was overtaking and passing the truck. At the time of the impact defendant's truck was negotiating a right-hand turn into a private driveway. The accident occurred on Northwest Nicholai Street, a highly industrialized area, in Portland, Oregon. The case was tried before a jury which returned a verdict for plaintiff in the sum of $1,500. Plaintiff appeals from the judgment, contending: that the court erred in admitting evidence of collateral benefits received by plaintiff during his disability; that the court erred in failing to admit evidence of an alleged admission against the interest of the corporate defendant; and that the court erred in failing to grant plaintiff's motion to strike from defendant's affirmative defense an allegation of plaintiff's failure to keep a proper lookout, an allegation of traveling at an excessive rate of speed, and an allegation of plaintiff's failure to keep his vehicle under proper control.

We must determine under what circumstances, if at all, defendant in a tort action may introduce evidence that plaintiff received collateral benefits compensating him for time lost from work as the result of an alleged injury. The disability income which plaintiff received consisted of 12 monthly payments of $500 each for a total of $6,000 from the Modern Woodman of America, and 26 weekly payments of $50 each for a total of $1,300 from a Teamster Health and Welfare policy. In addition, for nine months preceding the time of trial plaintiff was enrolled as a student at Mt. Hood Community College and was drawing GI benefits of $315 per month for a total of $2,835. This evidence concerning plaintiff's GI benefits was introduced by plaintiff in his case in chief.

An exhaustive Annotation in 47 A.L.R.3d 234 (1973), which supersedes an Annotation in 88 A.L.R.2d 483 (1963), reveals that the courts in this country are hopelessly divided on the question of admissibility of evidence that an injured plaintiff received benefits from a collateral source when offered to prove malingering, exaggeration of injuries, or motivation to extend the period of disability.

Some courts have held that the prejudicial effect of evidence of collateral source benefits so far outweights its probative value upon the issue of malingering, which is the issue in this case, that they have applied a strict exclusionary rule and regard the evidence to be inadmissible even when offered for a very limited purpose and hold that its admission constitutes an abuse of the trial court's discretion and is error. See Louisville & N.R. Co. v. Utz, 299 Ky. 765, 187 S.W.2d 439 (1945); Vest v. Gay, 275 Ala. 286, 154 So.2d 297 (1963); Moyer v. Merrick, 155 Colo. 73, 392 P.2d 653 (1964); Richmond County Hospital Authority v. Haynes, 121 Ga.App. 537, 174 S.E.2d 364 (1970).

Although earlier federal court cases held that evidence of collateral source benefits from Railroad Retirement Board in a FELA action was proper on issue of malingering, Reiner v. Northern Pacific Terminal Co. of Oregon, 259 F.2d 438 (9th Cir. 1958), and Page v. St. Louis Southwestern Railway Company, 312 F.2d 84 (5th Cir. 1963), the United States Supreme Court in Eichel v. New York Central R. Co., 375 U.S. 253, 84 S.Ct. 316, 11 L.Ed.2d 307 (1963), in reversing a decision of the Court of Appeals for the Second Circuit, which held that the exclusion of such evidence was error, stated:

'* * * In our view the likelihood of misuse by the jury clearly outweighs the value of this evidence. Insofar as the evidence bears on the issue of malingering, there will generally be other evidence having more probative value and involving less likelihood of prejudice than the receipt of a disability pension. * * *. It has long been recognized that evidence showing that the defendant is insured creates a substantial likelihood of misuse. Similarly, we must recognize that the petitioner's receipt of collateral social insurance benefits involves a substantial likelihood of prejudicial impact. * * *.' 375 U.S. at 255, 84 S.Ct. at 317.

This rationale was applied in a later case, Caughman v. Washington Terminal Company, 120 U.S.App.D.C. 217, 345 F.2d 434 (1965), in which that court held that evidence admitted over objection that plaintiff had received some benefits from the Railroad Retirement Board and at time of trial was receiving public assistance constituted reversible error.

At the other end of the judicial spectrum are those courts that have adopted a liberal view that evidence of the receipt by plaintiff of collateral source benefits is, in and of itself of sufficient probative value to render it admissible for the purpose of demonstrating a disposition to malinger. See Wentworth v. Butler, 134 Minn. 382, 159 N.W. 828 (1916); Perry v. Public Service Coordinated Transport, 136 N.J.L. 398, 56 A.2d 617 (1948); Ridilla v. Kerns, 155 A.2d 517 (Mun.Ct.App.D.C.1959); Lewis v. Fidelity & Casualty Company of New York, 230 So.2d 636 (La.App.1970). The Perry case was criticized in another New Jersey case, Clark v. Piccillo, 75 N.J.Super. 123, 182 A.2d 381 (1962), which suggested that the rule in Perry ought to be discarded.

In between these two views are those courts which have, instead, in decisions interpreting a multitude of different factual situations, held, that the admissibility of such evidence is within the discretion of the trial judge. The confusion in these reported...