Elaine Rosenthal, as of the Estate of Martin C. Rosenthal, Deceased v. Kenneth W. Warren, and New England Baptist Hospital

This appeal in a diversity case raises the question whether New York would apply a Massachusetts damage limitation to the death of a New York domiciliary occurring in Massachusetts. The appeal, taken before final judgment pursuant to 28 U.S.C. Sec. 1292(b), is from an order of the district court granting partial summary judgment in favor of the plaintiff in an action for wrongful death, 342 F.Supp. 246. The partial summary judgment struck the affirmative defense based upon the Massachusetts wrongful death statute limiting recoverable damages to ". . . not less than five thousand nor more than fifty thousand dollars, to be assessed with reference to the degree of [the tortfeasor's] culpability . . . ."1 The district court held that New York law was applicable. That law places no fixed value on wrongful death or limitation upon the damages in a wrongful death action. N.Y.Estates, Powers & Trust Law, McKinney's Consol.Laws, c. 17-b, Sec. 5-4.3; N.Y.Const. art. 1, sec. 16. We affirm.

The relevant facts are simple, the legal issue difficult. The decedent, Dr. Martin C. Rosenthal, was a citizen of New York. Decedent and his wife, who as executrix is plaintiff here, went to Boston where he was examined and diagnosed by Dr. Warren, whom the plaintiff describes as a world-renowned physician and surgeon treating patients from all over the world. On March 27, 1969, eight days after an operation performed by Dr. Warren at the New England Baptist Hospital, decedent died in the hospital while under the care of the defendant Warren.

Suit, alleging malpractice and asking for $1,250,000 in damages, was brought in New York state court. Jurisdiction of Dr. Warren to the extent of his insurance coverage was obtained by attachment levied on the St. Paul Fire & Marine Insurance Company, a Minnesota corporation doing business in New York, the malpractice insurer of a clinic where Dr. Warren is employed.2 Jurisdiction of New England Baptist Hospital, of which Dr. Warren is surgeon in chief, a trustee, a member of the planning committee and an officer of the corporation, was obtained by service upon another officer of the hospital while soliciting funds in New York City. Defendants removed the suit to the federal district court on the basis of diversity of citizenship.

It is undisputed that although the hospital is a Massachusetts corporation, approximately one-third of its patients in 1969 came from outside Massachusetts and approximately 8 per cent of its patients in the same year were from New York. Indeed, the hospital claimed in its 1969 annual report that it was "not a local or community hospital in the usual sense because its patients come from literally everywhere." An affidavit of the head of the casualty underwriting department of the Boston office of St. Paul Fire & Marine, which issued the liability policy under which defendant Warren was covered, indicates that a general surgeon's liability policy in Massachusetts has a basic limit premium of $192, while a New York City surgeon pays a basic limit premium of $1,139, and that one factor contributing to the difference is the "dollar exposure" in New York, which has no wrongful death limitation. Dr. Warren's policy, however, makes no reference to coverage limitation in wrongful death cases.

This being a diversity case, it is, of course, elemental that we must look to the choice of law rules of the forum state, that is, to New York law. Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941); Patch v. Stanley Works, 448 F.2d 483, 487 (2d Cir. 1971). Formerly New York probably would have applied the law of Massachusetts under the simplistic rule of lex loci delicti. Baldwin v. Powell, 294 N.Y. 130, 61 N.E.2d 412 (1945); Whitford v. Panama Railroad Co., 23 N.Y. 465 (1861). But cf. Conklin v. Canadian-Colonial Airways, Inc., 266 N.Y. 244, 194 N.E. 692, Id., 242 App.Div. 625, 271 N.Y.S. 1107 (1935) (New Jersey death limitation inapplicable to a New Jersey plane crash because the validity of a ticket stipulation for limiting the airline's damages is to be determined by New York law, where the ticket was purchased).

In Kilberg v. Northeast Airlines, Inc., 9 N.Y.2d 34, 172 N.E.2d 526, 211 N.Y. S.2d 133 (1961), however, the New York Court of Appeals characterized the Massachusetts wrongful death limitation as "procedural" and refused to apply it in a suit brought in New York by a New York decedent's estate arising from the crash of an airplane flight originating in New York but fatally ending at Nantucket, Massachusetts. The court said that "[m]odern conditions make it unjust and anomalous to subject the traveling citizen of this State to the varying laws of other States through and over which they move," and pointed out that there were only 14 states limiting death case damages as of that time. 9 N.Y.2d at 39, 211 N.Y.S.2d at 135, 172 N.E.2d at 527. The court also characterized wrongful death recovery limitations as "absurb and unjust"3 and emphasized the strong New York policy against such limitations, at least as to its domiciliaries, enshrined in a constitutional prohibition against them. Said the court, "The absurdity and injustice have become increasingly apparent in the six decades that have followed [the adoption of the New York constitutional prohibition]. For our courts to be limited by [the Massachusetts] damage ceiling (at least as to our own domiciliaries) is so completely contrary to our public policy that we should refuse to apply that part of the Massachusetts law . . . ." 9 N.Y.2d at 40, 211 N.Y.S.2d at 136, 172 N.E.2d at 528.

Kilberg foreshadowed New York's total break with the wooden rule that the law of the place of the tort inevitably governed. The break became complete in the landmark Babcock v. Jackson, 12 N.Y.2d 473, 240 N.Y.S.2d 743, 191 N.E.2d 279 (1963), where the Court of Appeals chose to apply New York law even though a statute of the place of the tort foreclosed rather than merely limited liability. Babcock refused to apply an Ontario statute barring recovery by an automobile guest in the case of an automobile accident in Ontario in which the driver and passenger were New Yorkers. The opinion laid the foundation for an "interest analysis" approach to choice of law problems, looking to "the law of the jurisdiction which, because of its relationship or contact with the occurrence or the parties has the greatest concern with the specific issue raised in the litigation." 12 N.Y.2d at 481, 240 N.Y.S.2d at 749, 191 N.E.2d at 283. Carefully distinguishing what the court then considered was Ontario's legislative concern over guest-driver collusion against insurers from its interest in regulating the manner in which a driver operates his car, 12 N.Y.2d at 482-483, 240 N.Y.S.2d 750, 751, 191 N.E.2d at 284, and examining the relative importance of the relationships and contacts of the respective jurisdictions in light of "the relevant purposes of the tort rules involved,"' 12 N.Y.2d at 482, 240 N.Y.S.2d at 750, 191 N.E.2d at 284,4 the Babcock court concluded that application of the inflexible rule of lex loci delicti could lead to "unjust and anomalous results." 12 N.Y.2d at 484, 240 N.Y.S.2d at 751, 191 N.E.2d at 285.

Analysis of the respective interests underlying the choice of law applicable in tort cases was soon explicitly extended to actions for wrongful death. See Long v. Pan American World Airways, Inc., 16 N.Y.2d 337, 266 N.Y.S.2d 513, 213 N.E.2d 796 (1965) (applying Pennsylvania law to an air crash where decedents were Pennsylvania residents but wreckage landed in Maryland). In Miller v. Miller, 22 N.Y.2d 12, 290 N.Y.S.2d 734, 237 N.E.2d 877 (1968), the New York Court of Appeals faced the question whether to apply a Maine $20,000 limit on wrongful death recovery in the case of a New York resident killed in Maine while a passenger in an automobile driven by a Maine resident. Again the court emphasized the strong New York policy against wrongful death limitations and saw "no substantial countervailing considerations" which would warrant the rejection of New York law, pointing out that the Maine statute did not "regulate conduct" and that "the only justifiable reliance which could be present here would involve the purchase of liability insurance in light of the remedies available to an injured person." 22 N.Y.2d at 19, 290 N.Y.S.2d at 740, 237 N.E.2d at 881. But the court pointed out that standard automobile liability policies issued in Maine drew no distinction between liability coverage for wrongful death and personal injuries, 22 N.Y.2d at 20, 290 N.Y.S.2d at 740, 237 N.E.2d at 881, so that it could not have been purchased in reliance on the Maine wrongful death limitation.

Similarly, in Tooker v. Lopez, 24 N.Y.2d 569, 301 N.Y.S.2d 519, 249 N.E.2d 394 (1969), the New York Court of Appeals refused to apply a Michigan guest statute in the case of an automobile accident which occurred on an intra-Michigan trip taken by two New York coeds at Michigan State, one the driver and the other the decedent passenger. Relying upon Miller v. Miller, supra, the court "rejected unequivocally" "[t]he argument that the choice of law in tort cases should be governed by the fictional expectation of the parties." 24 N.Y.2d at 577, 301 N.Y.S.2d at 526, 249 N.E.2d at 399. Tooker not merely questioned, it for all practical purposes overruled, Dym v. Gordon, 16 N.Y.2d 120, 125, 262 N.Y.S.2d 463, 467, 209 N.E.2d 792, 794 (1965), insofar as Dym (purporting to rely on Babcock) had held that the law of the state with the "most significant relationship to the parties" was to govern. Tooker rather looked to the law of the state with the "superior interest" in having its policy or law applied. See 24 N.Y.2d at 574, 301 N.Y.S.2d at 523, 194 N.E.2d at 397. Tooker also criticized Macey v. Rozbicki, 18 N.Y.2d 289, 274 N.Y.S.2d 591, 221 N.E.2d 380 (1966), which, relying on other language of Babcock, had seemingly adopted a "contact counting" rather than an "interest analysis" approach to choice of law problems. 24 N.Y.2d at 575, 301 N.Y.S.2d at 524, 194 N.E.2d at 398.

The most recent conflict of laws tort case to reach the New York Court of Appeals, Neumeier v. Keuhner, 31 N.Y.2d 121, 335 N.Y.S.2d 64, 286 N.E.2d 454, (1972), did hold the Ontario guest law applicable in a suit by an Ontario decedent's executrix against a New York driver's estate arising from an accident in Ontario, the court saying that New York has "no legitimate interest in ignoring the public policy of [the] foreign jurisdiction . . . and in protecting the plaintiff guest domiciled and injured there from legislation obviously addressed, at the very least, to a resident riding in a vehicle traveling within its borders." 31 N.Y.2d at 125-126, 335 N.Y.S.2d at 68, 286 N.E.2d at 456. In no way, however, did the court retreat from the position it had staked out in Kilberg and Miller, refusing to apply other states' wrongful death limitations in the case of the death of a New York domiciliary.5

Seeking to divine New York conflicts law, the federal courts of New York have not always been totally consistent in refusing to apply damage limitations of other states against New York decedents. Two federal cases which did refuse to do so arose out of the same Nantucket crash involved in Kilberg. Pearson v. Northeast Airlines, Inc., 309 F.2d 553 (2d Cir. 1962) (en banc), cert. denied, 372 U.S. 912, 83 S.Ct. 726, 9 L.Ed.2d 720 (1963), held that the Kilberg rule was "a proper exercise of [New York's] power to develop conflict of laws doctrine" and not contrary to the full faith and credit clause, U.S.Const. art. IV, Sec. 1, or the due process clause.

Gore v. Northeast Airlines, Inc., 373 F.2d 717 (2d Cir. 1967), followed the Kilberg holding even though the widow and infant children survivors of a New York decedent moved to Maryland a month after the accident and the decedent's adult children lived at all times in California.

In Ciprari v. Servicos Aereos Cruzeiro, 245 F.Supp. 819 (S.D.N.Y.1965), aff'd per curiam, 359 F.2d 855 (2d Cir. 1966), however, a Brazilian limitation of damages for personal injuries was held to control in the case of a New York domiciliary who bought his ticket in Brazil for an intra-Brazilian trip in a Brazilian airliner. Both the district court, 245 F.Supp. at 824-825, and the court of appeals, which affirmed on the district court's opinion, see also 359 F.2d at 856 (Waterman, J., concurring), relied heavily on Dym v. Gordon, supra, since questioned and in substance overruled in Tooker v. Lopez, supra, and held Brazil to be the jurisdiction most significantly concerned with the law suit.6

This review of the relevant case law7 leaves us with the overwhelming conclusion that, except for a federal case which relied heavily on a discredited state case, the strong New York public policy against damage limitations has triumphed over the contrary policies of sister states in every case where a New York domiciliary has brought suit. This conclusion is particularly striking in wrongful death actions where the New York policy, embedded in a state constitutional prohibition against damage limitations, has without exception been applied in suits brought for New York decedents since Kilberg. One might well inquire whether it would be anomalous to permit Dr. Rosenthal's heirs to recover without damage limitation if he died in a plane crash en route to Boston's Logan International Airport (Kilberg) or in a taxicab from Logan to New England Baptist (Miller) but not once he stepped into the hospital itself. But to do so would substitute "a domiciliary conceptualism that rested on a vested right accruing from the fact of domicile," Miller v. Miller, supra, 22 N.Y.2d at 29, 290 N.Y.S.2d at 748, 237 N.E.2d at 887 (dissenting opinion), for New York's sophisticated "interest analysis" approach to choice of law problems. The New York precedents require more.

Appellants contend that Massachusetts is the situs of the events leading to this law suit and, in effect, that the intent, either actual or constructive, of the parties was for the Massachusetts limitation on damages to govern in the event of a malpractice claim. This argument fails for many reasons. Quite probably it never occurred to Dr. Rosenthal, Dr. Warren or to the New England Baptist Hospital that a choice of law problem would arise; at least one does not ordinarily think of wrongful death limitations even when undertaking surgery. This is not a case where the conduct of the Massachusetts doctor or hospital vis a vis the decedent was patterned upon the Massachusetts death limitation. It is therefore not unfair to apply New York's compensatory policy to them. Cf. Babcock v. Jackson, supra, 12 N.Y.2d at 483, 240 N.Y.S.2d at 750-751, 191 N.E.2d at 284. Additionally, it cannot be said that the defendants purchased insurance with the expectation Massachusetts law would govern damage recovery in this case. As in Miller v. Miller, supra, the specific insurance policy here does not distinguish between liability coverage for wrongful death and personal injuries, nor does it distinguish between medical practice on Massachusetts and out of state citizens. Finally, neither the hospital not the doctor named here as defendants operate provincially; the doctor has a world-wide following and the hospital actively solicits funds from outside the Commonwealth of Massachusetts (including New York) and treats patients from "literally everywhere." It is thus impossible to say with any certainty what the parties' actual "expectations" as to choice of law were.

Even if expectations, real or constructive, could be hypothesized, they would be legally irrelevant. Despite the argument that looking to the expectations of the parties to solve choice of law problems promotes "'an unconscious acceptance of legality and [the] legal order,"' Miller v. Miller, supra, 22 N.Y.2d at 28, 290 N.Y.S.2d at 747, 237 N.E.2d at 886 (dissenting opinion), this contractual type of approach to multistate tort problems has been "summarily rejected" by the New York Court of Appeals. Tooker v. Lopez, supra, 24 N.Y.2d at 577, 301 N.Y.S.2d at 526, 249 N.E.2d at 399; Miller v. Miller, supra, 22 N.Y.2d at 20, 290 N.Y.S.2d at 741, 237 N.E.2d at 881; see also D. Cavers, The Choice of Law Process 119, 302 (1965); Traynor, Conflicts of Law in Time, 1967 Duke L.J. 713, 715. It is not without significance in this regard that the "adventitious" element in airline crash cases, mentioned in Kilberg and other New York airline crash cases, was given little or no weight in Miller and Tooker. Looking to the supposed expectations of the parties smacks heavily of the "counting of contacts" approach to conflicts applied in Macey v. Rozbicki, supra, but disavowed in Tooker.

Rather, as we view it, the New York courts would balance against the New York interest in protecting its domiciliaries against wrongful death limitations the interests of Massachusetts in limiting damages for wrongful deaths allegedly caused by Massachusetts citizens or occurring in Massachusetts. Consideration of Massachusetts' interests in this case should, however, be from the perspective that the damage limitation is not confined to wrongful deaths resulting from medical malpractice but applies to all wrongful deaths however caused. Thus, any interest Massachusetts has in keeping medical liability insurance premiums down so as to avoid passing the increased costs on to Massachusetts citizens in the form of higher medical fees is simply one facet of whatever larger interest it may have in limiting in death as distinguished from personal injury cases the size of damage recovery against its citizens generally.8 See Tiernan v. Westext Transport, Inc., 295 F.Supp. 1256, 1264 (D.R.I.1969).

That interest we think the New York courts would say is one not based upon logic, reason or social policy, but is really the vestigial remains of the mistaken view that there was no common law action for wrongful death. We say "mistaken," for Massachusetts has only recently held precisely that, as of now, "the right to recovery for wrongful death is of common law origin . . .," Gaudette v. Webb, Mass., 284 N.E.2d 222, 229 (1972), relying upon the late Mr. Justice Harlan's landmark opinion in Moragne v. States Marine Lines, Inc., 398 U.S. 375, 90 S.Ct. 1772, 26 L.Ed.2d 339 (1970) (wrongful death action lies under general maritime law for death caused by violation of maritime duties). In any event, it is our considered view that the New York Court of Appeals would view the Massachusetts limitation, in the words of Justice Hatch (note 3 supra), as so "absurd and unjust" that the New York policy of fully compensating the harm from wrongful death would outweigh any interest Massachusetts has in keeping down in this limited type of situation the size of verdicts (and in some cases insurance premiums). If as Kilberg pointed out, "The absurdity and injustice [of wrongful death recovery limitations] have become increasingly apparent [since 1894] . . . .," 9 N.Y.2d at 40, 211 N.Y.S.2d at 136, 172 N.E.2d at 528, since Kilberg they have become even more so. Since Kilberg, a number of states have repealed their wrongful death limitations or increased the amounts so that at the present time there are only seven which have an outright limit,9 although some jurisdictions place a limit on a component of the damages10 and various states impose a limit in suits against certain governmental bodies.11 Indeed, Massachusetts itself recently increased its limits.12 Our examination indicates that Massachusetts is unique, moreover, in both imposing minimum and maximum damage limitations and assessing damages in proportion to the degree of the wrongdoer's culpability.13 Thus, the "absurdity and injustice" of death recovery limitations in general is heightened insofar as Massachusetts is concerned, because it relates damages recoverable not to the damages sustained, but to the degree of culpability, however that can be measured, on the part of the defendant.14 A respected, famous surgeon like Dr. Warren might well be held liable, were the Massachusetts statute applicable, for only $5,000 in damages, regardless of the damages sustained by the decedent's survivors. Thus the anachronistic concept15 embodied in the Massachusetts act is hardly one that the New York courts can be expected to embrace in the case of the death of a New York domiciliary with whose wife and children New York is "vitally concerned . . ." Miller v. Miller, supra, 22 N.Y.2d at 18, 290 N.Y.S.2d at 739, 237 N.E.2d at 880. The New York policy favors "a just recovery" and "principles of fair play," MacKendrick v. Newport News Shipbuilding & Dry Dock Co., 59 Misc.2d 994, 1011, 302 N.Y.S.2d 124, 140-141 (S.Ct.1969), that is to say, the "just, fair and practical result." Neumeier v. Kuehner, supra, 31 N.Y.2d at 127, 335 N.Y.S.2d at 69, 286 N.E.2d at 457, which would not be furthered by applying the idiosyncratic Massachusetts law here. Our educated guess as to what the New York courts would do is to follow Kilberg and Miller and the teachings of Long, and apply the New York law of damages.

The constitutional argument, skillfully set forth in the dissent, was not raised by the parties below or on this appeal. We believe that in this case, like Pearson v. Northeast Airlines, Inc., 309 F.2d 553 (2d Cir. 1962) (en banc), cert. denied, 372 U.S. 912, 83 S.Ct. 726, 9 L.Ed.2d 720 (1963), New York has a significant interest-its domiciliary is the one who died and his next of kin are New York's charges-and the "incident" in Massachusetts is not purely "a local one," id. at 561, since the decedent was from out of state, and the defendant hospital is a national one in terms of its patients, its staff, its reputation and its efforts to obtain out-of-state contributions. In these circumstances, the refusal by New York to apply the Massachusetts death act's qualitative and quantitative limitations, even as it applies the remainder of the death act, is not so unreasonable as to violate the full faith and credit clause, 309 F.2d at 561; see Currie, The Constitution and the Choice of Law: Governmental Interests and the Judicial Function, 26 U.Chi.L.Rev. 9, 13-15, 75 (1958); 63 Colum.L.Rev. 133, 141-44 (1963). Compare Home Insurance Co. v. Dick, 281 U.S. 397, 50 S.Ct. 338, 74 L.Ed. 926 (1930). The fact that Massachusetts was the situs of the tort and the residence of the defendant would not be sufficient to require as a matter of full faith and credit that the limitations in the Massachusetts law control, in light of the very strong New York policy against wrongful death limitations in connection with its citizens and next of kin and in light of the interstate aspects of the transaction. Pearson established that the Massachusetts death statute could be constitutionally sued upon in New York absent its penal quality and its damage limitations. Given a legitimate forum state interest-as is here present-we see no constitutional difference between death on the Pearson airplane, death in a taxicab on the way from the airport and death on the operating table.

We agree with the court below and affirm the judgment.

The majority has concluded that the New York courts, on the facts of this case, would refuse to apply the Massachusetts wrongful death damage limitation. Accordingly, it has held that the federal district court, sitting in diversity, correctly refused to apply the Massachusetts damage limitation. From this holding I must dissent both because I do not agree that this a proper appraisal of applicable New York law and because I believe that the full faith and credit clause of the United States Constitution bars the New York courts, and federal district courts sitting in diversity, from refusing to apply the Massachusetts limitation on the facts of this case.

In effect, the majority has concluded that, as a matter of policy, the New York courts would decline to apply such a damage limitation when the plaintiff, or the decedent, is a New York resident. Although such a per se rule would be consistent with the dictum of the New York Court of Appeals in Kilberg v. Northeast Airlines, 9 N.Y.2d 34, 211 N.Y.S.2d 133, 172 N.E.2d 526 (1961), it flies in the face of the interest-analysis approach to conflict of laws issues later embraced by that court in Babcock v. Jackson, 12 N.Y.2d 473, 240 N.Y.S.2d 743, 191 N.E.2d 279 (1966), and subsequent decisions. As this court noted in Gore v. Northeast Airlines, 373 F.2d 717, 723 (1967), these later decisions "have created doubts as to the continued validity of the Kilberg doctrine in New York despite citations approving its vitality in the opinions in these cases." Indeed, these subsequent cases have sought to cast Kilberg in an interest-analysis light, and have cited the minimal interest that Massachusetts, in that case, had in the application of its law, in light of the mere fortuity that the airplane there happened t