Rehearing Denied Dec. 6, 1973.
Opinion on pages 176-185 omitted.
See 11 Cal.3d 574 for Supreme Court opinion.
Johnson, Davies, Greve & Clifford by Robert Lea, Sacramento, for petitioner.
Alfonso Z. Gonzales, Francis W. Robichaud, Rust & Mills by Thomas C. Westley, Sacramento, for real parties in interest.
JANES, Associate Justice.
Petitioner Manuel Cid Hurtado, one of two defendants in an action for wrongful death arising from an automobile accident in California, seeks a writ of mandate directing respondent court to vacate its decision, upon trial of the special issue, by which it held that the California unlimited measure of damages rule is applicable to this case rather than the limiting rule of plaintiff's and decent's domicile.
For the sake of clarity, petitioner will hereafter be referred to as 'defendant,' and the real parties in interest (plaintiffs in the wrongful death action) as 'plaintiffs.'
Defendant's central contention is that California's policy in such choice of law problems, as enunciated in the leading case of Reich v. Purcell (1967) 67 Cal.2d 551, 63 Cal.Rptr. 31, 432 P.2d 727, requires application of the limited liability rule of plaintiffs' domicile, the State of Zacatecas, Mexico, rather the law of California, the state in which defendant's conduct and the death occurred and which state is also the domicile of both defendants. Defendant urges that the 'governmental interest' analysis required by Reich v. Purcell, supra, compels giving effect to the Mexican rule and that the trial court failed to utilize that analysis in its determination of the issue, but simply held that the law most favorable to plaintiffs should be applied.
See, for characterization by this term, the excellent symposium, Comments on Reich v. Purcell (Hereinafter 'Comments'), 15 U.C.L.A. L. Rev. 551, 585 and passim (1968.)
SUMMARY OF THE FACTS
On January 19, 1969, in Sacramento County, California, plaintiffs' decedent, Antonio Hurtado--a resident and domiciliary of Zacatecas, Mexico--was riding as a guest in a vehicle owned and operated by defendant, Manuel Cid Hurtado, Antonio's cousin. Defendant's car, traveling on a two-lane paved road, struck a truck owned and operated by defendant Jack Rexius. The truck was parked partially on the pavement of the lane in which defendant [110 Cal.Rptr. 592] was driving. Upon impact of defendant's car with the truck, the truck was propelled forward, colliding with an automobile also owned by defendant Rexius and occupied by his son. All three vehicles were registered in California and all three operators were residents of California. Both defendants have denied liability.
Antonio Hurtado, plaintiff's decedent, was in California temporarily on a tourist visa. He was here only as a visitor and was not seeking employment in California. Plaintiffs, his widow and minor children were at the time of the accident and still are residents and domiciliaries of the State of Zacatecas, Mexico.
At trial of the special issue, the court took judicial notice Evidence Code sections 452 and 453, of the civil law of Zacatecas, Mexico, which limits the maximum recovery of damages for wrongful death. Under section 1889 of the Civil Code of the State of Zacatecas, Mexico, a decedent's survivors may receive a maximum of 25 pesos per day for a period of 730 days. The section expressly makes Federal (Mexican) Labor Law applicable in determining the amount of damages that may be recovered in wrongful death actions. Section 1890 provides that the court may, in its discretion, award an additional amount not to exceed one-third of the first amount as extra indemnity. Thus, the maximum amount recoverable under that law is 24,334 pesos or $1,964.72 at the applicable exchange rate of 12.5 pesos to the dollar.
Following trial of the special issue, respondent court held that the California law, not the limiting rule of plaintiff's and decedent's domicile, applies as to the measure of damages for wrongful death in the present action.
Our discussion of the parties' contentions necessarily starts with the opinion by former Chief Justice Traynor in Reich v. Purcell, supra, 67 Cal.2d 551, 63 Cal.Rptr. 31, 432 P.2d 727, a wrongful death action which arose from an automobile accident which occurred in Missouri. Defendant Purcell, the owner and operator of one of two vehicles which collided head-on, was a resident and domiciliary of the State of California. The other car, owned and operated by Mrs. Reich, was occupied also by the Reichs' two minor children. At the time of the accident the Reichs were residents of Ohio, but were on their way to California and contemplated setting here. Mrs. Reich and one of her children died in the accident. Plaintiffs, Mr. Reich and the surviving child, became residents of California and brought an action in this state for wrongful death. The estates of plaintiffs' decedents were being administered in Ohio.
The parties stipulated in Reich that judgment in a specified sum be entered for the death of the one child (and for the personal injuries suffered by the other child and the damage to Mrs. Reich's car). They further stipulated that judgment be entered for the death of Mrs. Reich in the amount of $25,000 if the Missouri law limiting recovery in such cases to that amount should be held applicable and in the amount of $55,000 otherwise. Neither California law nor Ohio law contains any provision limiting the amount of damages recoverable in a wrongful death action.
The court, in Reich, continued its rejection of the former rule that the law of the place of the tort necessarily governs in all such cases, pointing out that '[i]n a complex situation involving multi-state contacts, . . . [t]he forum must search to find the proper law to apply based upon the interests of the litigants and the involved states.' (67 Cal.2d at p. 553, 63 Cal.Rptr. at p. 33, 432 P.2d at p. 729.)
See Comments (Professor Gorman), supra, p. 607.
In Reich the court stated that '[w]hen application of the law of the place of the wrong would defeat the interests of the litigants and of the states concerned, we have [110 Cal.Rptr. 593] not applied that law. (Grant v. McAuliffe, supra, 41 Cal.2d 859, 867, 264 P.2d 944; Emery v. Emery, 45 Cal.2d 421, 428, 289 P.2d 218.) Grant was an action for personal injuries arising out of an automobile accident in Arizona between California residents. The driver whose negligence caused the accident died, and the court had to choose between the California rule that allowed an action against the personal representative and the Arizona rule that did not. We held that since 'all of the parties were residents of this state, and the estate of the deceased tortfeasor is being administered in this state, plaintiffs' right to prosecute their causes of action is governed by the laws of this state relating to administration of estates.' Under these circumstances application of the law of the place of the wrong would not only have defeated California's interest and that of its residents but would have advanced no interest of Arizona or its residents. (Grant v. McAuliffe, supra, 41 Cal.2d at 867, 264 P.2d 944.)' (Emphasis added.) (Id. at p. 554, 63 Cal.Rptr. at p. 33, 432 P.2d at p. 729.)
In arriving at its conclusion that the Missouri damages limitation was inapplicable, the Reich court reasoned: 'As the forum we must consider all of the foreign and domestic elements and interests involved in this case to determine the rule applicable. Three states are involved. Ohio is where plaintiffs and their decedents resided before the accident and where the decedents' estates are being administered. Missouri is the place of the wrong. California is the place where defendant resides and is the forum. Although plaintiffs now reside in California, their residence and domicile at the time of the accident are the relevant residence and domicile. At the time of the accident the plans to change the family domicile were not definite and fixed, and if the choice of law were made to turn on events happening after the accident, forum shopping would be encouraged. [Citation.] Accordingly, plaintiffs' present domicile in California does not give this state any interest in applying its law, and since California has no limitation of damages, it also has no interest in applying its law on behalf of defendant. As a forum that is therefore disinterested in the only issue in dispute, we must decide whether to adopt the Ohio or the Missouri rule as the rule of decision in this case.' (67 Cal.2d at pp. 555-556, 63 Cal.Rptr. at p. 34, 432 P.2d at p. 730.)
Recognizing that the State of Missouri is concerned with conduct within the borders of that state and that as to such conduct Missouri has the predominant interest of the three states involved, our Supreme Court pointed out that '[l]imitations of damages for wrongful death, however, have little or nothing to do with conduct. They are concerned not with how people should behave but with how survivors should be compensated. The state of the place of the wrong has little or no interest in such compensation when none of the parties reside there. Wrongful death statutes create causes of action in specified beneficiaries and distribute the proceeds to those beneficiaries. The proceeds in the hands of the beneficiaries are not distributed through the decedent's estate and, therefore, are not subject to the claims of the decedent's creditors and consequently do not provide a fund for local creditors. Accordingly, the interest of a state in a wrongful death action insofar as plaintiffs are concerned is in determining the distribution of proceeds to the beneficiaries and that interest extends only to local decedents and beneficiaries.' (Emphasis added.) (67 Cal.2d at p. 556, 63 Cal.Rptr. at p. 34, 432 P.2d at p. 730.)
The Reich court acknowledged that '[d]efendant's liability should not be limited when no party to the action is from a state limiting liability and when defendant, therefore, would have secured insurance, if any, without any such limit in mind' (id. at p. 556, 63 Cal.Rptr. at p. 35, 432 P.2d at p. 731), but the court further declared that '[a] defendant cannot reasonably complain when compensatory damages are assessed in accordance with the law of his domicile [110 Cal.Rptr. 594] and plaintiffs receive no more than they would had they been injured at home.' (Emphases added.) 67 Cal.2d at p. 556, 63 Cal.Rptr. at p. 35, 432 P.2d at p. 731.) Accordingly, under the circumstances in Reich, the court held that giving effect to the State of Ohio's interest in affording full recovery to the victims did not conflict with any substantial interest of the State of Missouri; refused to apply the Missouri limitation; and directed the trial court to enter judgment for plaintiffs, for the death of Mrs. Reich, in the sum of $55,000 in accordance with the stipulation of the parties. (67 Cal.2d at pp. 556-557, 63 Cal.Rptr. 31, 432 P.2d 727.)
In the case at bench we have involved only the State of California (the place of the accident and the domicile of defendant) and the foreign State of Zacatecas, Mexico (the domicile of plaintiffs and their decedent). Defendant recognizes that California, having no limitation on damages thus has no policy favoring restriction of the amount which can be assessed against a defendant for causing the wrongful death of another. The fact that California has no policy limiting recovery by survivors and instead provides for the recovery of full compensation (Code Civ.Proc., § 377; Civ.Code, § 3333) is urged, however, as having no impact on this case because plaintiffs are not California domiciliaries.
In support of the latter contention, defendant relies upon the statement in Reich v. Purcell, supra, that limitation of damages statutes, although irrelevant to conduct (the concern of the place of the wrong), are concerned with the compensation of survivors, and that that interest extends only to local decedents and beneficiaries (67 Cal.2d at p. 556, 63 Cal.Rptr. 31, 432 P.2d 727); and on the cases of Ryan v. Clark Equipment Co. (1969) 268 Cal.App.2d 679, 74 Cal.Rptr. 329, hear. den., and Howe v. Diversified Builders, Inc. (1968) 262 Cal.App.2d 741, 69 Cal.Rptr. 56.
The Ryan case involved an appeal from a summary judgment for defendant, the Michigan manufacturer of a front-end loader which plaintiffs' decedent, a resident and domiciliary of Oregon, had been operating at the time of his death in Oregon. Plaintiff, decedent's widow, and her minor daughters, all residents and domiciliaries of the State of Oregon at the time of the fatal accident and at the time suit was brought in California, received a total of $35,000 in settlement of their rights under the Employer's Liability Act of Oregon, and executed covenants not to sue decedent's employers. Plaintiff then commenced a California action for breach of warranty and for negligent design against defendant in its status as a Michigan corporation doing business in California. Oregon law at the time limited recovery for wrongful death to $20,000 and also provided that any settlement with a joint tortfeasor under the Employer's Liability Act could be set off against any claims arising under its Wrongful Death Act. Defendant was properly characterized as a joint tortfeasor with decedent's employers under Oregon law. Michigan, like California, imposed no limitation on recovery of damages for wrongful death.
The Court of Appeal applied the analysis required by Reich v. Purcell, concluded that Oregon, rather than Michigan or California law was applicable, and held that no triable issue existed on the matter of damages since the sum to be set off was greater than the maximum recovery available under Oregon law. In so ruling, the court referred to the above narrated discussion in Reich concerning the nature of limiting statutes, and stated: 'Here, Oregon is the only state which has any real interest in how the decedent's survivors are to be compensated. Accordingly, we conclude that under the test of Reich the interests of the involved states and the litigants compel the application of Oregon law to this case. Oregon's interest in the compensation of her residents for wrongful death overrides any possible concern of Michigan [110 Cal.Rptr. 595] in the regulation of the activities of manufacturers. Neither California nor Michigan has any interest in extending to Oregon residents any greater rights than are afforded by the state of residence. (See Howe v. Diversified Builders, Inc., 262 Cal.App.2d [741, 745-746,] 69 Cal.Rptr. 56.)' (268 Cal.App.2d at p. 683, 74 Cal.Rptr. at p. 332.)
Howe v. Diversified Builders, Inc., supra, 262 Cal.App.2d 741, 69 Cal.Rptr. 56, relied upon by the court in Ryan, supra, as well as by defendant here, was an action brought by a Nevada resident against two California corporations for injuries received in Nevada while plaintiff Howe was employed by defendants pursuant to a contract entered into in Nevada. At the time of the accident, Howe was covered by Nevada's Industrial Insurance Act. He accepted benefits under that act which--under Nevada law--provided his exclusive remedy. It was stipulated that under California law Howe would have been classified as an independent contractor, and thus would not have been barred from suing because he would not have been covered by workmen's compensation. The Court of Appeal affirmed a summary judgment granted defendants on the basis of their claim that Nevada law applied to the end that plaintiff had no right in California to maintain an action against his employers.
After alluding to the methodology of Reich v. Purcell, supra, the Howe court stated:
'This is not a complex situation involving multi-state contacts and California has no interest in extending to Nevada residents greater rights than are afforded them by the state of their domicile. At all relevant times appellant was, and now is, domiciled in Nevada; the contract under which he engaged to render services was entered into in Nevada; the services were performed exclusively in Nevada; the injury occurred in Nevada; and if appellant or his family were to become economic burdens by reason of his incapacity, such burden would fall upon the State of Nevada. (Cf. Travelers Ins. Co. v. Workmen's Comp. App. Bd., 68 Cal.2d 7, 12 et seq., 64 Cal.Rptr. 440, 434 P.2d 992.)
'California's sole 'contact' with the subject matter of the instant proceeding is the happenstance that respondents are California corporations. However, as previously indicated, no California 'interest' would be promoted by impairing the ability of California corporations to compete for business in other states by imposing upon them obligations to the residents of such states which those states do not impose upon foreign corporations or their own domestic corporations. Therefore, although 'California has rejected the traditional mechanical solutions to choice-of-law problems,' it is clear that the trial court correctly 'adopted foreign law' in granting respondents' motion for summary judgment because 'it is appropriate in light of the significant interests in the particular case.' (Travelers Ins. Co. v. Workmen's Comp. App. Bd., supra, p. 11, 64 Cal.Rptr. 440, 434 P.2d 992.)' (Emphasis added.) (262 Cal.App.2d at pp. 745-746, 69 Cal.Rptr. at p. 59.)
In regard to the impact of the 'exclusive' nature of Nevada's statutory remedy, the court noted:
'We are not called upon here to consider what rights a California resident working in Nevada as a subcontractor under a contract entered into in California might have in the courts of California against a general contractor. As noted earlier, California's decision to adopt or not to adopt the law of another state is not dependent upon whether or not the law of the other state purports by its terms to be 'exclusive.' In the instant action the trial court properly adopted Nevada law because California has no interest in the subject matter of the action which would warrant its extending to Nevada residents rights to which they are not entitled by the state of their domicile; particularly where to do so would discriminate invidiously against California employers engaged in business in Nevada.' (Id. at p. 747, 69 Cal.Rptr. at p. 60.)
[110 Cal.Rptr. 596]Based on the foregoing cases, defendant urges that California has no interests in the matter of the compensation of decedent's survivors which will be advanced by application of the California rule of unlimited damages. Defendant contrasts this absence of interest with the substantial interest the State of Zacatecas has in its own domiciliaries in regard to the manner in which plaintiffs should be compensated for the death of their decedent, also a domiciliary of Zacatecas.
Plaintiffs concede that as non-domiciliaries their welfare is not of paramount concern to California. They contend, however, that analysis of the governmental policies served by the two conflicting compensation statutes reveals the Zacatecas interest to be primarily the protection of defendants rather than a limitation upon recovery by survivors. They urge as highly significant the fact that defendant is a non-domiciliary of Zacatecas, and from this they conclude that the limiting rule of Zacatecas is inapplicable since no domiciliary of Zacatecas is a defendant in this case. The California interest--plaintiffs say--is one of concern for survivors in the sense that they should receive full compensation, to the exclusion of--or at least outweighing--any interest in protecting defendants from possible 'excessive' recoveries against them. Since there is no need here to protect a Zacatecan defendant, Zacatecas has no interest in limiting plaintiffs' recovery, and--plaintiffs continue--since neither California nor Zacatecas has any interest in limiting the amount recoverable from defendant, giving effect to the California rule favoring full recovery would defeat no interest of Zacatecas and would advance the interests of California.
Moved as we might be to look favorably upon plaintiffs' arguments if the question were an open one, we are bound--as an intermediate appellate court--by the guidelines set out in Reich v. Purcell, supra, distinguishing between a state's concern with conduct, on the one hand, and limitations of damages on the other, and we must rest our decision upon those principles. We have hereinabove emphasized those portions of the Reich opinion which demonstrate the lack of equation between a defendant's conduct and limitations of damages for wrongful death, and the court's conclusion that the interest of a state in a wrongful death action insofar as compensation of survivors is concerned extends only to its local decedents and beneficiaries. (67 Cal.2d at p. 556, 63 Cal.Rptr. 31, 432 P.2d 727.)
In our discussion of the issue we have not overlooked the public policy question touched upon by the court below. The trial court, in its memorandum opinion, concluded that to apply the restrictive Mexican rule would be violative of the public policy of California. In Victor v. Sperry (1958) 163 Cal.App.2d 518, 329 P.2d 728, a collision occurred in Mexico between two cars owned, operated and occupied by California domiciliaries. The Court of Appeal applied the law of the place of the tort (limiting damages), holding the measure of damage provision of a Mexican statute to be unseverable from the Mexican law creating the cause of action. The court further held that application of such limitation of damages was not repugnant [110 Cal.Rptr. 597] to the public policy of California. Plaintiffs in the instant proceeding contend that Victor was overruled, in effect, by Reich v. Purcell, supra, and urge the claimed repugnance in support of their position seeking application of the California rule of damages. The contention is without merit in view of the later cases of Ryan v. Clark Equipment Co., supra, and Howe v. Diversified Builders, Inc., supra, which upheld application of foreign limiting statutes.
As an example in support of its public policy conclusion, the court pointed out that Mexican nationals who are disabled while working on jobs in California are to be paid workmen's compensation benefits and that disability payments may be continued even after they return to Mexico. The two situations cannot be equated. The Workmen's Compensation Act constitutes a separate body of law designed to protect only those persons who are working in California; workmen's compensation benefits are accorded to nonresident aliens by virtue of the special status of employer and employee. (Lab.Code, § 3600 et esq.) Moreover, a statutory maximum on recovery of death and disability benefits is imposed by the Workmen's Compensation Act (Lab.Code, § 4702), whereas in California recovery in a wrongful death action is unlimited. Significantly, an action for wrongful death is founded on negligence of the defendant, while liability for an employee's injury or death is imposed on the employer regardless of negligence. (Lad.Code, § 3600.)
The trial court, in its memorandum opinion above-mentioned, and the parties to this proceeding, refer in their briefs to the case of Ramirez v. Wilshire Ins. Co. (1970) 13 Cal.App.3d 622, 91 Cal.Rptr. 895 [hear. den.,] in which the California measure of damages was applied. Plaintiffs in that case, residents of California, were guests in a car owned and operated by a Californian, which collided in Mexico with a briated and uninsured Mexican national. The owner of the cab had insurance which was ineffective while the car was being driven by an inebriated driver. Plaintiffs sought recovery under the uninsured motorist provision of their host's California insurance policy. The carrier sought declaratory relief in the form of a determination whether the Mexican limitation on damages was to be applied or whether damages were to be awarded under California's unlimited rule. Analysis of the decision discloses its basis to be the existence of substantially greater California contacts supporting the state interest articulated in Reich then are present in the case at bench.
That portion of the Ramirez opinion to which the trial court referred, and upon which plaintiffs rely, is sheer dictum consisting of the suggestion that in cases of this type 'comity would be better served if California extended to a Mexican resident and national equal treatment in its courts with its own residents and citizens.' (13 Cal.App.3d at p. 633, 91 Cal.Rptr. at p. 903.)
For an extreme example of a limited award, see Armiger v. Real S.A. Transportes Aereos (1967) 126 U.S.App.D.C. 304, 377 F.2d 943, 944; and Tramontana v. S.A. Empresa De Viacao Aerea Rio Grandense (1965), 121 U.S.App.D.C. 338, 350 F.2d 468, 471-473, cert. den., 383 U.S. 943, 86 S.Ct. 1195, 16 L.Ed.2d 206, upholding wrongful death recovery limited to 100,000 cruzeiros (approx. $170 U.S.) to survivors of U.S. Navy Band killed when their military aircraft collided with a Brazilian airliner. Brazil's aviation accident death statute imposed that limit. The interest of Brazil in protecting its airline industry took the form of a national policy which outweighs the interest of the survivors' domiciles.
Let the peremptory writ of mandate issue as prayed.
Retired Presiding Justice of the Court of Appeal sitting under assignment by the Judicial Council.