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Beul v. Asse Int'l. - 233 F.3d 441 (7th Cir. 2000)

Rule:

Rules of general applicability and purely managerial character governing the jury, such as the form in which a civil jury is instructed, are quintessentially procedural for purposes of the Erie rule. They are therefore supplied by federal law in diversity as in all other federal cases.

Facts:

Defendant ASSE International is a nonprofit corporation that operates international student exchange programs. For a fee of $2,000 it placed Plaintiff Kristin Beul, a 16-year-old German girl who wanted to spend a year in the United States, with the Bruce family of Fort Atkinson, Wisconsin. Some months into the placement, Richard Bruce came into Plaintiff's room and raped her. This began a protracted sexual relationship between the two. After noting some irregularities, the placement volunteer coordinator for ASSE removed Kristin from the home, but Kristen and Bruce continued to correspond and talk on the phone. Kristin had decided that she was in love with Bruce and considered herself engaged to him. When Mrs. Bruce discovered some of Kristin's love letters and alerted the authorities, a sheriff's deputy interviewed Bruce, who had committed a misdemeanor by having sex with a 16-year-old, Wis. Stat. § 948.09, and the next day, Bruce killed himself, leaving a note expressing fear of jail. It was undisputed that the events culminating in Bruce's suicide inflicted serious psychological harm on Kristin.

Plaintiff Kristen Beul sued defendant ASSE for negligence in the performance of a contract by failing to keep closer tabs on Plaintiff. The jury returned a verdict finding that Plaintiff's damages were $1,100,000 and that she was 41 percent responsible for them, thus the federal district court entered a judgment against ASSE for $649,000. On appeal, ASSE argued that Plaintiff's action was not actionable under tort law and alleged the judge erred in instructing the jury.

Issue:

Was there a causal relation between the ASSE's negligence and the plaintiff's harm?

Answer:

Yes

Conclusion:

The appellate court held negligence in the performance of a contract that foreseeably results in personal injury, including emotional distress, was actionable under tort law. Defendant was not excused by the doctrine of "superseding cause;"  Plaintiff’s high school would not have been liable for the consequences of Bruce's sexual activity with Kristin even if the school should have reported her frequent absences to the ASSE’s volunteer placement representative; the criminal activities with their bizarre suicide sequel were not foreseeable by the school. But part of ASSE's duty and the representative's function was to protect foreign girls and boys from inappropriate sexual activity initiated by members of host families. The Court held that any errors in the jury instructions were harmless.

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