Edwards v. Erie Coach Lines Co. - 2011 NY Slip Op 5583, 17 N.Y.3d 306, 929 N.Y.S.2d 41, 952 N.E.2d 1033

Rule:

Neumeier v Kuehner has set up a three-rule framework for resolving choice of law in conflicts settings involving guest statutes, which by definition allocate losses after the tort occurs rather than regulate primary conduct. Under the first Neumeier rule, when the driver and passenger are domiciled in the same state, and the vehicle is registered there, the law of their shared jurisdiction controls. The second rule addresses the situation where the driver and the passenger are domiciled in different states, and the law of the place where the accident occurred favors its domiciliary. When the driver's conduct occurs in the state where he is domiciled, which would not impose liability, that state's law applies. Conversely, if the law of the place where the accident occurred permits the injured passenger to recover, then the driver, in the absence of special circumstances, may not interpose a conflicting law of his state as a defense. In other situations, when the passenger and the driver are domiciled in different states, the rule is necessarily less categorical. Thus, under the third Neumeier rule, the law of the state where the accident occurred governs unless it can be shown that displacing that normally applicable rule will advance the relevant substantive law purposes without impairing the smooth working of the multistate system or producing great uncertainty for litigants.

Facts:

A bus hit a tractor-trailer on a New York highway. The injured and deceased bus passengers and the bus defendants were Ontario domiciliaries; the trailer defendants were Pennsylvania domiciliaries. Ontario law capped noneconomic damages where negligence caused catastrophic personal injury, while New York law did not. The trial court held that Ontario law applied to any award of noneconomic damages. Plaintiffs appealed; the Appellate Division of the New York Supreme Court affirmed. Plaintiffs sought further review.

Issue:

Did the trial court correctly hold that Ontario law applied to any award of noneconomic damages?

Answer:

Yes, with respect to the bus defendants. No, with respect to the trailer defendants.

Conclusion:

The high court held that defendants' failure to raise Ontario law in their answers as required by CPLR 3016(e) did not preclude the trial court from judicially noticing Ontario law under CPLR 4511(b) and in engaging in choice-of-law analysis, as defendants raised the issue in their pretrial motions and plaintiffs were not prejudiced. The Ontario cap controlled any award of noneconomic damages against the bus defendants because they shared an Ontario domicile with plaintiffs. However, as to the trailer defendants, under the third Neumeier v. Kuehner rule, the place of the tort--New York--was the proper choice because the domicile of plaintiffs, the domicile of the trailer defendants, and the place of the tort were all different. The trailer defendants did not ask the trial court to consider the trial court to consider the law of their domicile, and they had no contacts whatsoever with Ontario other than the happenstance that plaintiffs and the other defendants were domiciled there.