Lead Opinion
Jill Nesladek, as trustee for the heirs and next of kin of her son Jeremy, appeals the decision of the District Court
I.
On April 18, 1990, near West Point, Nebraska, Jeremy’s father Ken Nesladek started the family’s Ford pickup truck, preparing to take three-year-old Jeremy and Jeremy’s younger brother Dustin to day care. With Dustin in the truck, Ken Nesladek realized Jeremy and his toy wagon were behind the truck and left the vehicle to move the wagon and retrieve his son. As he proceeded to do so, the truck moved backward and rolled over Jeremy, severely injuring him. Jeremy died from his injuries about two years later on February 20, 1992, at the family farm in Nebrаska.
After Jeremy’s death, the Nesladeks moved to Minnesota. Jill Nesladek brought this wrongful death suit in Minnesota state court. Ford removed the case to federal court and moved for summary judgment, arguing that Nesladek’s claim was barred by Nebraska’s ten-year statute of repose applicable to products liability actions. The Dis
II.
All agree that this is a conflict of laws case. Under Nebraska law, which the District Court applied in dismissing the claim, “any product liability action,” with some exceptions not relevant here, “shall be commenced within ten years after the date when the product which allegedly caused the personal injury, death, or damage was first sold or leased for use or consumption.” Neb.Rev.Stat. § 25-224(2) (1989). The truck at issue was a composite of two vehicles, combined in 1989 by Ken Nesladek and Harvey Kreikemeirer: a 1976 Ford model F-250 cab on a 1973 Ford model F-350 chassis. Thus, under Nebraska law, Nesladek cannot maintain this action, as it was precluded by the statute of repose in 1986 (ten years after the 1976 model was first sold) at the latest. Because ten years elapsed before the accident occurred, a cause of action never accrued.
Minnesota’s approach to the issue of liability for injury, death, or damage allegedly caused by aged products is its “useful life” statute. Under that statute, “it is a defense to a [products liability] claim against a designer, manufacturer, distributоr or seller of the product or a part thereof, that the injury was sustained following the expiration of the ordinary useful life of the product.” Minn.Stat. § 604.03 subd. 1 (1992). “The useful life of a product ... is the period during which with reasonable safety the product should be useful to the user.” Id. § 604.03 subd. 2. The fact-finder considers, inter alia, wear and tear, subsequent industry developments, conditions of use, the manufacturer’s stated useful life, and user modification of the product. Id. Minnesota’s useful life statute would not necessarily be disposi-tive of Nesladek’s claim; rather, it would be for the jury to decide whether the truck’s useful life had expired before the accident in question occurred. See Hodder v. Goodyear Tire & Rubber Co.,
There being no question that this case presents a true conflict of laws, see Lommen v. City of East Grand Forks,
III.
Federal courts sitting in diversity apply the forum state’s conflict of laws rules. Klaxon Co. v. Stentor Elec. Mfg. Co.,
In Minnesota “ ‘[i]t has long been recognized that substantive law is that part of law which creates, defines, and regulates rights, as opposed to “adjective or remedial” law, which prescribes method [sic] of enforcing the rights or obtaining redress for their invasion.’ ” Zaretsky v. Molecular Biosystems, Inc.,
Under Minnesota law, “statutes of limitations relate to remedy” and therefore are procedural, so that the period of time
Nebraska’s characterization of its own statute, while not dispositive because we are applying Minnesota law, is to be considered under the choice-of-law analysis used by the Minnesota courts. See Myers v. Government Employees Ins. Co.,
Finally, we note that the Minnesota Court of Appeals on at least one occasion has noted its disinclination “to classify anything аs procedural because of the potential that doing so will encourage forum shopping.” Zaretsky,
Having determined that the Minnesota courts would characterize the statutes in question as substantive does not end our inquiry; it means only that we do not automatically apply Minnesota law. We must now go forward and, applying Minnesota’s choice-of-law rules, determine whether Nebraska or Minnesota law applies.
IV.
In 1973, the Minnesota Supreme Court adopted Professor Robert A. Leflar’s choice-influencing considerations for choice of law analysis. Milkovich v. Saari,
A. Predictability of Result
As in most tort cases, predictability of result is of little relevance here. See Lommen,
B. Maintenance of Interstate Order
Nesladek would have us ignore this factor as irrelevant in tort cases.
In the circumstances of this case, this consideration becomes quite relevant. “[M]ain-tenance of interstate order [in tort cases] is generally satisfied as long as the state whose laws are purportedly in conflict has sufficient contacts with and interest in the facts and issues being litigated.” Myers, 225 N.W.2d at 242. The record here does not support the choice of Minnesotа law on this ground.
Although not so limited so as to precipitate a constitutional challenge from Ford (Ford does do business in Minnesota), Minnesota’s contacts with this litigation nevertheless are tenuous, essentially limited to two: (1) Nesla-dek now lives and serves as trustee of Jeremy’s estate in Minnesota, and (2) the allegedly defective automatic transmission gear selection system, while manufactured and assembled in Indiana, was installed into the 1976 truck in Ford’s St. Paul, Minnesota, assembly plant. The composite truck owned by the Nesladeks was not purchased, licensed, modified, or maintained in Minnesota. The accident did not occur in Minnesota, none of Jeremy’s medical treatment took place in Minnesota, and no medical expenses were incurred in Minnesota. All of the foregoing events took place in Nebraska, except for a brief period of rehabilitation treatment for Jeremy in Texas. Minnesota thus has little “interest in the facts and issues being litigated.” Id.
In determining the relevance of the maintenance-of-interstate-order factor in a given case, “the court may also consider whether or not application of Minnesota law will encourage forum shopping.” Hague v. Allstate Ins. Co.,
We conclude that the maintenance-of-interstate-order factor favors the choice of Nebraska law. Nebraska is the state in which almost all the events that gave rise to this lawsuit occurred. In contrast, Minnesota has only the remotest connection with the subject matter of the case. Moreover, the Nesladeks have admitted to forum shopping in this case, a practice that undercuts the maintenance of interstate order.
C. Simplification of the Judicial Task
This consideration would seem to have little relevance here. The District Court is capable of determining, interpreting, and applying either the law of Nebraska or the law of Minnesota, since both are straightforward and there is no indication that the plain language of the statutes and the courts’ interpretations of them are inadequate to provide the guidance a trial court might wish to have. See Jepson v. General Casualty Co.,
D. Advancement of the Forum’s Governmental Interests
As a matter of Minnesota law, this factor requires analysis not only of Minnesota’s governmental interests, but also of Nebraska’s public policy. See Gate City,
In considering the relative policy interests of Nebraska and Minnesota, we note that both the Nebraska statute of repose and the Minnesota useful life statute advance the
The opinion in Hodder, an en banc decision of the Minnesota Supreme Court, suggests that useful life statutes “seem incoherent both theoretically and operationally.” Id. at 832 (quoted authority omitted). The authoring justice “wonders if it is possible to devise a workable repose statute that measures the time period by a useful life concept.” Id. Hodder had no other justices writing, so we feel justified in concluding that repose statutes are not an aberration in the eyes of the Minnesota Supreme Court.
As Nеsladek points out, Minnesota does have an interest in “providing access to its courts for its citizens,” Myers,
Further, we conclude that the Nebraska statute of repose does not go so far as to offend another of Minnesota’s interests upon which Nesladek relies on, compensating tort victims. See Jepson,
We believe that on balance this factor favors the choice of Nebraska law.'
E. The Better Rule of Law
“Concern for the ‘better law’ is part of a comprehensive test and is to be exercised only when other choice-influencing considerations leave the choice of law uncertain.” Myers,
V.
For the reasons discussed above, we hold that this ease is subject to the Nebraska statute of repose. Accordingly, the judgment of the District Court is affirmed.
Notes
. The Honorable Richard H. Kyle, United States District Judge for the District of Minnesota.
. Most courts that have been faced with the question have found statutes of repose to be substantive law for conflict of law purposes. See 4 American Law of Products Liability 3d § 47:55 at 89 & n. 22 and cases cited therein (1990).
. At oral argument, the Court engaged counsel in a colloquy concerning the possibility of equitable tolling of a statute of repose, for reasons such as infancy or fraud. The Court questioned whether a statute of repose can be tolled, and, if so, whether it still can be substantive law. We do not decide those questions because they are of no consequence to this case. The accident at issue here occurred outside the ten-year repose period, long after the statute of repose barred the accrual of any cause of action based on injury, death, or damage caused by the truck. The elements of fraud could never be met so as to toll the ten years because there could be no reliance on fraudulent statements that might cause Nesladek to sleep on her rights — because, by the time of the accident, she had no such rights. Further, if Jeremy had survived and brought his own action, again there would be no tolling for his infancy because the ten-year period was long past when the accident occurred — in fact, it may well have expired before Jeremy was even born. A statute of repose is different from a statute of limitations in this regard because a tort limitations statute does not begin to run until the injury, death, or damage occurs — or until the cause of action accrues. On the other hand, a statute of repose prevents the cause of action from accruing in the first place. It may be that, if an action accruеs within Nebraska’s ten-year products liability repose period, the barring of a suit brought outside the ten years is in effect a procedural bar, and the repose statute would be subject to tolling. But such is not the case here, and that possibility does not change our decision that the statute of repose, as applied to the facts of this case, is substantive law.
. Indeed, Nesladek does not even suggest that the Minnesota useful life statute is a procedural law. It thus appears to be conceded that it is substantive for purposes of Minnesota's choice-of-law analysis.
. The other reasons given were Nesladek's desire to attend school at St. Scholastica in Duluth, which, according to Ford's brief at 23 (and unchallenged by Nesladek), she never has done, and the family’s desire to move away from the site of the accident and of Jeremy’s eventual death.
. Nesladek's main brief and her reply brief include this quotation: ”[T]he Milkovich line of cases involving foreign torts makes the advancement of the forum’s governmental interest and better rule of law the only relevant considerations.” Appellant’s Brief at 9; Appellant's Reply Brief at 6 (minor misquote in Reply Brief) (emphasis added by Nesladek in Reply Brief). The briefs cite DeRemer v. Pacific Intermountain Express Co.,
. The Hodder court's discussion of other states' statutes of repose that contain a presumptive period of useful life was neutral, except for a question about constitutionality. See Hodder,
. The Minnesota Court of Appeals recently noted "that the Minnesota Supreme Court has given the 'better law’ consideration no significant weight in a case for more than a decade.” Lom-
Dissenting Opinion
dissenting.
I respectfully dissent.
Although this is a diversity action and is not binding authority beyond this, case, at least as far as Minnesota law is concerned, I nevertheless feel compelled to dissent as to the majority’s choice-of-law analysis.
More importantly, the Minnesota Supreme Court has been quite clear that in tort situations, only the last two items of Professor Leflar’s choice-influencing considerations are relevant. The majority fails to provide a careful analysis of existing Minnesota law. In Schwartz v. Consolidated Freightways Corp.,
Moreover, the Schwartz court clearly discounted the relevance of forum shopping in Minnesota’s choice-of-law analysis. The court stated:
Defendants argue that plaintiff was forum shopping. Suffice it to say that the courts of this state are open to those residents and nonresidents alike who properly invoke, within constitutional limitations, the jurisdiction of these courts. In the case at bar, plaintiff is a Minnesota resident who is currently suffering from extensive and severe injuries. It would be аt least plausible to presume that Minnesota courts would be plaintiffs logical choice. Further, it is noteworthy that plaintiff did not first bring his action in another state and then later bring suit in this state.
Furthermore, to support its use of forum shopping, the majority quotes Lommen v. City of East Grand Forks,
The City asserts that Lommen might have filed suit in Minnesota to avoid North Dakota’s seat belt defense and because North Dakota does not provide for joint and several liability; the City argues that Minnesota law should thus apply simply because Lommen voluntarily chose the Minnesota forum. To the extent Lommen may have been forum shopping, we note that we do not prefer Minnesоta law on any substantive issue simply because Minnesota is the forum. See Robert A. Leflar, American Conflicts Law § 90, at 182 (3d ed. 1977) (“Mere forum preference, as such and by itself, is not a valid reason for any choice-of-law result.” (emphasis in original)). Choice of forum ought not determine choice of law.
The majority also places reliance upon Jepson v. General Casualty Co.,
where we would be sending a message to those people living on our borders to take advantage of the benefits our neighboring states offer in terms of lower insurance rаtes, lower vehicle registration fees, and sales taxes, and then, if they are injured, to take advantage of Minnesota’s greater willingness to compensate tort victims. Minnesota does not have an interest in encouraging that conduct.
Similarly, I point out that in Hague v. Allstate Insurance Co.,
Thus, I think the majority misstates the conflict of law analysis that exists in Minnesota, and its approach is clearly contrary to the beacon cases of Schwartz, Bigelow, and Milkovich. These cases first make clear that because this is a tort action, the majority should have considered only the advancement of the forum’s governmental interest and the better rule of law. In addition, I think the policy in Minnesota is that which the Schwartz case has previously announced; namely, the Minnesota courts are open to those residents and nonresidents alike who properly invoke their jurisdiction. See
In analyzing the advancement of the forum’s governmental interest, we look to both factual contacts and poliсy considerations. See, e.g., Schwartz,
In addition, Minnesota also has substantial contacts with the alleged wrongdoing; that is, Ford assembled and then placed in the stream of commerce the actual vehicle in question. The allegedly defective vehicle which brought about the wrongful death was sold commercially by Ford in the state of Minnesota. The fortuitous fact that the wrongful death happened to occur in Nebraska or that the plaintiff lived in Nebraska at the time of the occurrence is not of any greater weight than Minnesota’s contacts. At the time the lawsuit was filed, Minnesota’s interest in this litigation is at least as great as, and probably greater than, Nebraska’s.
Turning to policy considerations, the laws in question — Minnesota’s useful-life statute and Nebraska’s statute of repose — both further the interest of placing some time limit on the bringing of products liability actions. Yet Minnesota clearly has an additional policy interest in deterring Ford from putting a defective product into the stream of commerce within its borders. See, e.g., Mitchell,
Thus, the advancement of the forum’s government interest, both terms of factual contacts and policy considerations, weighs in favor of applying Minnesota law. Even assuming, arguendo, that this factor points equally to Minnesota and Nebraska, Minnesota’s useful-life statute is the better rule of law under the circumstances existing in this particular case. The imposition of a repose period in this factual context would not serve a worthwhile purpose. A statute of repose is based on the idea that a defect does not really exist if the product has been in use for longer than the repose period. Yet here, at least according to the plaintiff’s allegations, Ford has known for many years of this defect and failed to recall the vehicle or properly warn of its dangers. To now allow Ford to escape the possibility of liability merely because the repose period has passed, even though Ford may have known of the existence of the defect long before the statute’s running, serves no purpose but to arbitrarily punish the plaintiff. Thus, Nebraska’s inflexible statute of repose is not well suited for these circumstances.
Rather, because this case involves a known defective product, the equities favor allowing the plaintiff to bring the cause of action and then letting a jury decide whether the product has run the course of its useful life. I contend, thereforе, that Minnesota’s law should be applied under Minnesota’s choice-of-law methodology.
For the foregoing reasons, I respectfully dissent.
. I do not quarrel with the majority’s ultimate finding that Nebraska's statute of repose is substantive law. However, I do think the question is much closer than the majority acknowledges. I believe it is significant that the statute of repose appears under the civil procedure section of Nebraska's code. See Neb.Rev.Stat. § 25-224. I also feel the majority misses the emphasis of the court's colloquy at oral argument relating to the equitable tolling of the statute of repose for reasons of infancy or incapacity. Lawson v. Ford Motor Co.,
Section 25-224(4) provides that notwithstanding the 10-year ban imposed by § 25-224(2), “any cause of action or claim which any person may have on July 22, 1978, may be brought not later than two years following such date.”
The foregоing 2-year period of limitations, however, is extended by [Nebraska’s tolling provision].
The fact that tolling provisions are not at issue in this case is not material. The point is that substantive law and substantive rights cannot be tolled as has been done with Nebraska’s statute of repose. However, I leave this to the Nebraska Supreme Court to more definitively resolve in the event that they need to do so, and simply recognize that our opinion is only controlling in this case. Thus, I do not necessarily agree with the analysis made by the majority opinion on the substantive aspect of the statute of repose, but I assume that it is a substantive provision for purposes of this dissent.
. Courts frequently apply the law of the jurisdiction where an allegedly defective product was assembled or placed into the stream of commerce, or where the plaintiff is domiciled, rather than the law of the state where the accident or injury occurred. See, e.g., Mitchell v. Lone Star Ammunition, Inc.,
