Turnbull v. USAir, Inc., 243
| Decision Date | 06 January 1998 |
| Docket Number | No. 243,D,243 |
| Citation | 133 F.3d 184 |
| Parties | James TURNBULL and Karen Turnbull, Plaintiffs-Appellees, v. USAIR, INC., Defendant-Appellant. ocket 97-7148. |
| Court | U.S. Court of Appeals — Second Circuit |
Richard F. Griffin, Buffalo, NY (Donna M. Lanham, Phillips, Lytle, Hitchcock, Blaine & Huber, Buffalo, NY, on the brief), for Defendant-Appellant.
Dan D. Kohane, Buffalo, NY (Vincent G. Saccomando, Hurwitz & Fine, P.C., Buffalo, NY, on the brief), for Plaintiffs-Appellees.
Before: MESKILL, JACOBS, Circuit Judges, and KORMAN, * District Judge.
The sole appellate issue presented in this diversity tort case is the applicability of the New York statute allowing an offset for economic loss that will be recovered from a collateral source. The district court ruled that the jury award for lost future earnings is not subject to offset in the amount of future Social Security disability payments, because the record does not demonstrate that the particular disorders that supported the jury award are the same disorders that supported the Social Security payments. We vacate and remand.
James Turnbull was a passenger aboard an airplane that was taxiing for take-off from the Greater Buffalo International Airport on December 5, 1989, when an overhead console (containing air nozzles, call buttons, and reading lights) swung loose and struck Turnbull on the head. According to Turnbull, the traumatic closed-head injury has caused headaches and a variety of other disorders, including difficulties in maintaining sustained attention, in carrying out orderly sequences of activities, and in coping with novel situations, as well as impaired balance, motor function problems, insomnia and erratic sleep cycles, anxiety, nervousness, and depression.
Turnbull sued USAir, Inc. in New York State Supreme Court, alleging that these disorders permanently disabled him from working. USAir removed the action to the United States District Court for the Western District of New York (Skretny, J.) on the basis of diversity jurisdiction. At trial, USAir argued that Turnbull suffered no more than a mild head injury and that Turnbull's USAir moved post-trial, pursuant to Fed.R.Civ.P. 59(e), to amend the final judgment to reflect an offset for past and future Social Security disability payments in the annual amount of approximately $12,000. In support of its motion, USAir offered to produce Turnbull's signed statement to the Social Security Administration ("SSA"), which specified the disabling condition as "[h]ead injury; traumatic brain injury; post concussion syndrome," and which specified the onset date as December 5, 1989 (the date of the USAir accident). Turnbull's statement to the SSA recounted "[i]ncapacitating headaches; fatigue; inability to tolerate stress; memory loss problems; impaired concentration; loss of coordination; [and] difficulty with balance." Turnbull claimed total disability, and the SSA granted benefits on that basis. USAir's post-trial motion argued that Turnbull's jury award should be reduced because the Social Security disability payments are a collateral source of income that would replace much of the award for Turnbull's past and future lost wages.
disability, if any, pre-dated the accident. The jury disagreed, and awarded Turnbull damages including $165,000 for past lost earnings and $70,000 for ten years of future lost earnings.
New York's common-law collateral source rule generally precludes a defendant from offering evidence that a plaintiff is being reimbursed by another source (to which the defendant has not contributed), or from seeking an offset on that basis. But the collateral source rule has been modified by a statute, N.Y. C.P.L.R. § 4545(c), which applies to any claim for personal injury seeking to recover economic loss, and which provides (inter alia ) that evidence shall be admissible to prove that any such economic loss "was or will ... be replaced or indemnified, in whole or in part, from any collateral source," including Social Security benefits. If the court finds that the plaintiff's economic loss "was or will, with reasonable certainty, be replaced or indemnified from any collateral source, it shall reduce the amount of the award by such finding" less premiums paid by the plaintiff. N.Y. C.P.L.R. § 4545(c) (McKinney 1992).
The district court denied USAir's motion in an unpublished decision and order:
Mr. Turnbull testified as to a variety of ailments, any of which or any combination of which, could have been the basis for the jury's finding of past and future lost earnings. Thus, although the basis for the Social Security award may be ascertained, it is impossible to find that the necessary "direct correspondence between the item of loss and the type of collateral reimbursement" exists in this case without speculating as to the specific rationale for the jury's award. Oden v. Chemung County I.D.A. [Industrial Development Agency], 87 N.Y.2d 81, 637 N.Y.S.2d 670, 673-74, 661 N.E.2d 142, 145-46 (Ct. of App. 1995). Since the "necessary correspondence between [the] essential elements [of the item of loss and the collateral source payment] is lacking, the purposes of the statute would not be served by applying the mandatory offset." Id., at 674. Additionally, [USAir] cannot sustain its burden of proof of reasonable certainty because any attempt to correspond an item of loss to a type of collateral source would involve speculation as to the basis of the jury's award of the type that Defendant's counsel was forced to engage in at the oral argument of the Motion.
Decision and Order at 6 (final alteration added).
This appeal is governed by the decision of the New York Court of Appeals in Oden v. Chemung County Indus. Dev. Agency, 87 N.Y.2d 81, 637 N.Y.S.2d 670, 661 N.E.2d 142 (1995). The plaintiff's judgment for economic loss in that case included (i) an award for lost pension benefits, and (ii) an award for future lost earnings. The trial court had applied an offset for the payments under an employer's disability pension program, which the plaintiff expected to receive in his lifetime, and thereby reduced almost to zero the total award for future economic loss.
After considering the language and purpose of § 4545(c), the Court of Appeals held that "the economic loss portion of an award should be reduced ... only when the collateral Here, the district court read Oden to preclude an offset unless USAir has demonstrated (1) that the jury based its award of lost earnings upon the itemized finding as to which of the specific disorders claimed by Turnbull caused him to be unable to work, and (2) that Turnbull's Social Security disability payments directly corresponded to that specific disorder or combination of disorders. In support of the district court's ruling, Turnbull makes the following argument: USAir at trial disputed that Turnbull suffered any ill-effects as a result of the USAir accident and suggested that Turnbull's disorders (if any) pre-dated the accident. If the jury believed USAir, then those disorders that pre-dated the accident were not reflected in the jury's award. Therefore, because the Social Security disability payments are based on a finding of "total disability," it is theoretically possible that many of the disorders that underlie the disability award from Social Security do not correspond to the disorders that underlie the jury award.
source payment represents reimbursement for a particular category of loss that corresponds to a category of loss for which damages were awarded." Id. at 84, 637 N.Y.S.2d at 671, 661 N.E.2d 142 (emphasis added). Applying that principle, the court upheld the offset of disability payments against the award for lost pension benefits because the disability payments were "paid in lieu of," and thus corresponded to, the lost pension benefits. Id. at 88, 637 N.Y.S.2d at 674, 661 N.E.2d 142. But the court held there could be no offset against the award for lost earnings because it was evident that the disability payments at issue in that case were contractually payable regardless of the plaintiff's future earnings. The disability payments therefore did not replace or correspond to lost future earnings. Id. at 89, 637 N.Y.S.2d at 674
We conclude that Oden does not require USAir to prove a correspondence between the specific disorders on which the jury based its award of...
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