Date of Examination: May 14, 1993
Professor
J.R. PIELEMEIER
CODE OF CONDUCT
Violations of the Code of Conduct include: (1) unauthorized con- versation among students concerning the examination; (2) giving, receiving, or soliciting unauthorized aid; (3) using materials which are not specifically permitted by the written examination instruction; (4) exceeding the examination time limit; or (5) any other dishonest conduct in connection with the examination.
INSTRUCTIONS
1. This examination consists of three questions. The suggested amount of time for each is 45 minutes, leaving you an extra fifteen minutes to allocate as you see fit. I suspect, but am not certain, that you will be more inclined to use extra time on question I than on the other two questions.
2. Questions I and II are slightly modified facts from cases that were decided by appellate courts during this semester. (Question I reflects facts from the first conflicts case decided by the New York Court of Appeals since Schultz (page 210 of your casebook)). If you would like the citations to these cases, feel free to ask me at any time after the exam.
In 1975, Acme Co., a company incorporated and with its principal place of business in State A, manufactured a 16-foot wide "Pyramid Form Bending Roll," a machine used to shape large pieces of metal. Acme sold the device to American Standard, Inc. (also incorporated and with its principal place of business in State A). American Standard closed its plant in State A around 1980, and sold the machine to Crouse, Inc., a company incorporated and with its principal place of business in State B. In 1990, Crouse sold the machine to Paul, Inc., which is incorporated and with its principal place of business in State C.
Paul, Inc. installed the bending roll in its plant in State C, and subsequently made some modifications to the machine. In 1992, Dennis Cooley, a resident of State C working at the plant, was injured while cleaning the machine.
Cooley filed for and received workers' compensation benefits from Paul, Inc. in State C. Because under State C law an employer providing such benefits "shall be released from all other liability whatsoever, whether to the employee or any other person," he could not additionally sue his employer, Paul, Inc., in tort. Cooley did, however, bring a products liability action against Acme--the original manufacturer, in State A. (Assume that this claim was permitted by the laws of both State A and State C).
In this action, Acme asserted a third party claim against Paul, Inc., seeking contribution in the event it was found liable to Cooley. Assume that State A could assert personal jurisdiction over Paul, Inc., based on the extensive business it did and the branch office it had in State A (although assume it had no manufacturing facilities in State A).
Paul, Inc. made a motion to dismiss the contribution claim against it, invoking the State C statute quoted two paragraphs ago, shielding employers from both direct claims by employees and contribution claims made by others. In response to the motion, Acme noted that State A's law would permit such a claim.
Research revealed that State C's Supreme Court had rejected constitutional challenges to its laws providing complete immunity to the employer, stating that the immunity "is the heart and soul of this legislation which has, over the years, been of highly significant social and economic benefit to the working person, the employer, and the State." State C's Supreme Court had also stated, "to deny an employer the immunity granted by our workers compensation statute would frustrate the efforts of the legislature to restrict the cost of industrial accidents and to afford a fair basis for predicting what those costs will be."
Statements from opinions of State A's Supreme Court, on the other hand, stressed that the reason for its law permitting a contribution claim against the employer was "basic fairness to the litigants." One opinion stated, "Under traditional joint and several liability rules, when more than one tortfeasor was responsible for the plaintiff's injury, each was potentially liable for the entire judgment, irrespective of relative culpability. Indeed, plaintiffs are not required to sue all wrongdoers, but can recover the entire judgment from the "deep pocket" they choose to sue. This inequity is mitigated by our rule permitting claims for contribution, allowing a defendant that pays more than its fair share of a judgment, as apportioned by the factfinder in terms of relative fault, to recover the difference from other tort-feasors. Stated simply, the goal of contribution is fairness to tortfeasors."
State A's position on the issue of contribution against an employer who has paid a workers' compensation award is clearly a minority view in the United States. The "trend" is against permitting such claims.
Assume that State A's Supreme Court has announced that it will resolve choice of law issues by using Interest Analysis, and that it will be willing to consider, as persuasive authority, principles from other jurisdictions that have adopted this approach, including California and New York.
Discuss whether the Court in State A should apply State A's or State C's law to Acme's contribution claim against Paul, Inc. (You need not discuss any constitutional issues).
In May of 1991, Brian Over was driving his father's car, with Julie and Christina Moore as passengers. The three teenagers were killed when the car collided with a Soo Line Train in Indiana. All three were Indiana residents. Soo Line is a Minnesota corporation with its principal place of business in Minnesota. It maintains an extensive network of railroad services in Minnesota, in addition to maintaining services in several other states.
David Over, who was Brian's father, was appointed personal representative and administrator of his son's estate in Indiana. Brian's mother, Bonita Over, and the Moores' father, John, were appointed trustees for the teenagers' next-of-kin for the purpose of asserting wrongful death claims arising from the accident.
Indiana's wrongful death statute only provides for the recovery of funeral expenses. Minnesota law is far more generous, allowing recovery for loss of contributions and services, including advice, comfort, assistance and protection. Because of this, Bonita and John (the trustees for the next-of-kin) were advised to and did bring wrongful death actions against Soo Line in a Minnesota state court.
Shortly after the suit was filed, Soo Line noticed the deposition of Bonita to be taken in Minnesota. During the deposition, Soo Line's attorneys learned that her husband, David, had accompanied her to the state. Having learned where they were staying, Soo Line's attorneys quickly drafted a third party complaint against David, as representative of his son's estate, alleging the estate was liable for contribution for any judgment obtained by the Moores, because of alleged negligence of Brian that led to the accident. This third party complaint, along with a summons, was served on David at his hotel in Minnesota.
Under Minnesota law, tortfeasors can be jointly and severally liable for the entire amount of damages awarded to a plaintiff (i.e., one defendant can be required to pay an entire judgment, even though more than one tortfeasor was involved), but can seek contribution or indemnity from joint tortfeasors. Thus, under Minnesota law, Soo Line's third party claim was viable.
Under Indiana law, however, there is no joint and several liability, and it does not permit actions for contribution. Thus, under Indiana law, Soo Line's contribution claim against David should be dismissed.
Soo Line moved to dismiss all claims against it except to the extent they sought recovery of funeral expenses, on the ground that Indiana law governed plaintiffs' claims. David moved to dismiss Soo Line's contribution claim against him, on the ground that Indiana law governed it.
Assume that the court, following Minnesota's Better Rule approach, would hold that Minnesota law is applicable to both claims. Discuss, for each of the claims, whether application of Minnesota law would be constitutionally permissible.
Stephens and Thomas, both citizens of Arizona, visited the country of New Zealand with their families in August of 1992. When going through customs, they saw a sign reading "Welcome to New Zealand. Upon Entering, You Are Agreeing to Abide by Our Laws. We Hope You Have a Pleasant Stay."
During this visit, while they were climbing a stairway adjacent to some waterfalls, Stephens and Thomas got into an argument. During this argument, Thomas accidentally hit Stephens, who lost his balance and fell over the railing to the ground below. Stephens broke both of his legs and was hospitalized for two weeks.
New Zealand has abolished virtually all traditional tort liability, replacing it with the New Zealand Compensation Act. Under this act, which covers all persons injured by accident in New Zealand, the injured person may not make a claim against whom we would normally define as a tortfeasor. Instead, the injured person files a claim with the New Zealand Accident Commission. The Commission will make payments for all needed medical expenses and will make certain other payments according to various schedules in the legislation and regulations. The Commission does not make any determination of fault, as the Act establishes a no-fault compensation system for all accidents in the country. The primary focus of the Commission is on the severity of the injury. The system is funded by taxes on employers, taxes on motor vehicles, and taxes from the general treasury. The Act also specifically provides:
Where any person suffers personal injury by accident in New Zealand ... no proceedings for damages arising directly or indirectly out of the injury shall be brought in any Court independently of this Act, whether by that person or any other person, and whether under any rule of law or any enactment.
When he was hospitalized, Stephens filed the forms to make a claim with the Commission. Based upon a review of these forms, the Commission paid all of his medical expenses, and also paid an additional "judgment" of the equivalent in American dollars of $10,000, which represented the "standard" compensation for broken legs ($5,000 for each) under the Act. Stephens did not appeal the Commission's determination, although he did have a right to appeal under the Act.
Upon his return to Arizona, Stephens consulted an attorney and filed suit against Thomas for his personal injuries in an Arizona state court. His complaint included allegations of negligence and reckless conduct, and sought compensatory and punitive damages in a total amount of $500,000. (Assume that under Arizona law, punitive damages may be awarded for "reckless" conduct).
Thomas made a motion for summary judgment to dismiss Stephens' complaint. In support of the motion he submitted the judgment of the New Zealand Commission and appropriate proof of New Zealand Law as it is stated in this question. Thomas argued that the Uniform Foreign Country Money-Judgments Recognition Act (discussed in class and reprinted after this question), required that Stephens' suit be dismissed.
Discuss how the motion should be resolved. Assume that the Uniform Act had just been passed into law in Arizona, and that there are no reported Arizona decisions construing it. Also assume that if Thomas' motion is not granted, the court will apply Arizona law to determine the issues of liability and damages.
Subdivision 1. Definitions. As used in this section:
(1) "foreign state" means any governmental unit other than the United States or any state, district, commonwealth, territory, or insular possession of the United States;
(2) "foreign judgment" means any judgment of a foreign state granting or denying recovery of a sum of money, other than a judgment for (a) taxes, or (b) a fine or other penalty, or (c) in matrimonial or family matters.
Subd. 2. Applicability. This section applies to any foreign judgment that is final and conclusive and enforceable where rendered even though an appeal is pending or it is subject to appeal.
Subd. 3. Recognition and enforcement. Except as provided in subdivision 4, a foreign judgment meeting the requirements of subdivision 2 is conclusive between the parties to the extent that it grants or denies recovery of a sum of money. The foreign judgment is enforceable in the same manner as the judgment of another state which is entitled to full faith and credit.
Subd. 4. Grounds for nonrecognition. (a) A foreign judgment is not conclusive if:
(1) the judgment was rendered under a system which does not provide impartial tribunals or procedures compatible with the requirements of due process of law;
(2) the foreign court did not have personal jurisdiction over the defendant; or
(3) the foreign court did not have jurisdiction over the subject matter.
(b) A foreign judgment need not be recognized if:
(1) the defendant in the proceedings in the foreign court did not receive notice of the proceedings in sufficient time to prepare a defense;
(2) the judgment was obtained by fraud;
(3) the claim for relief on which the judgment is based is repugnant to the public policy of this state;
(4) the judgment conflicts with another final and conclusive judgment;
(5) the proceeding in the foreign court was contrary to an agreement between the parties under which the dispute in question was to be settled otherwise than by proceedings in that court; or
(6) in the case of jurisdiction based only on personal service, the foreign court was a seriously inconvenient forum for the trial of the action.
Subd. 5. Personal jurisdiction. (a) The foreign judgment shall not be refused recognition for lack of personal jurisdiction if:
(1) the defendant was served personally in the foreign state;
(2) the defendant voluntarily appeared in the proceedings, other than for the purpose of protecting property seized or threatened with seizure in the proceedings or of contesting the jurisdiction of the court over the defendant;
(3) the defendant prior to the commencement of the proceedings had agreed to submit to the jurisdiction of the foreign court with respect to the subject matter involved;
(4) the defendant was domiciled in the foreign state when the proceedings were instituted, or, being a body corporate had its principal place of business, was incorporated, or had otherwise acquired corporate status, in the foreign state;
(5) the defendant had a business office in the foreign state and the proceedings in the foreign court involved a claim for relief arising out of business done by the defendant through that office in the foreign state; or
(6) the defendant operated a motor vehicle or airplane in the foreign state and the proceedings involved a claim for relief arising out of the operation.
(b) The courts of this state may recognize additional bases of jurisdiction.
Subd. 6. Stay in case of appeal. If the defendant satisfies the court either that an appeal is pending or that the defendant is entitled and intends to appeal from the foreign judgment, the court may stay the proceedings, with or without bond at the court's discretion, until the appeal has been determined or until the expiration of a period of time sufficient to enable the defendant to prosecute the appeal.
Subd. 7. Saving clause. This section does not prevent the recognition of a foreign judgment in situations not covered by this act.
Subd. 8. Short title. This section may be cited as the Uniform Foreign Country Money-Judgments Recognition Act.