Case Title: HIGHTOWER v. KANSAS CITY SOUTHERN RAILWAY CO.

Citation: 

Docket Number: 94011

State: oklahoma

Court: Oklahoma Supreme Court

Date: 2003-05-06T00:00:00Z

Document:
HIGHTOWER v. KANSAS CITY SOUTHERN RAILWAY CO.  HIGHTOWER v. KANSAS CITY SOUTHERN RAILWAY CO. 2003 OK 45 70 P.3d 835 Case Number: 94011 Decided: 05/06/2003 THE SUPREME COURT OF THE STATE OF OKLAHOMA JUANITA HIGHTOWER, as Guardian of the Person And Estate of WILLIAM FRANKLIN PEARL, An Incompetent Person, Plaintiff/Appellee, v. KANSAS CITY SOUTHERN RAILWAY CO., a Foreign Corporation, Defendant/Appellant. and J.T. LOCKE, and JERRY HINDS, Defendants. CERTIORARI TO THE COURT OF CIVIL APPEALS, DIVISION IV APPEAL FROM THE DISTRICT COURT OF LEFLORE COUNTY HONORABLE JOHN HENDERSON, TRIAL JUDGE ¶0 This case arises out of a train-motor vehicle collision at a railway crossing in Mena, Arkansas, which occurred on December 16, 1997 and resulted in serious personal injuries to the driver of the motor vehicle, William Franklin Pearl (hereinafter "Pearl"). Due to the significance of Pearl's injuries, this action was commenced on his behalf by Pearl's guardian, Plaintiff/Appellee Juanita Hightower. The action was filed in the District Court of LeFlore County against Defendant/Appellant Kansas City Southern Railway Co., (hereinafter "Railroad"), and Defendants, Engineer J.T. Locke, and Conductor Jerry Hinds. The cause was tried to a jury, which returned a verdict in favor of the engineer and conductor, but found that Pearl was 40 per cent negligent and the Railroad was 60 per cent negligent. The jury awarded compensatory damages in the amount of $1 million. Further, the jury found that the Railroad acted willfully, wantonly, and in reckless disregard for the rights of others and subsequent to a second-stage proceeding on punitive damages, the jury returned a verdict against Railroad for punitive damages in the amount of $100,000. Railroad appealed and the Court of Civil Appeals affirmed in part, reversed in part, and remanded for a new trial. Both parties filed Petitions for Writ of Certiorari. Upon certiorari previously granted as to both Petitions, THE COURT OF CIVIL APPEALS' OPINION IS VACATED; THE DISTRICT COURT'S JUDGMENT IS REVERSED; AND THE CAUSE IS REMANDED FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH TODAY'S PRONOUNCEMENT. Jerry L. McCombs and Jon Ed Brown of LeForce & McCombs, P.C., Idabel, Oklahoma, for plaintiff/appellee. Kirkman T. Dougherty and J. Rodney Mills of Hardin, Jesson & Terry, Fort Smith, Arkansas, for defendant/appellant. Lavender, J. ¶1 The issues in the present cause are as follows: (1) whether Pearl's state law negligence theories based upon adequacy of the warning devices, excessive train speed and "local hazard conditions" are preempted by federal law such that the trial court's instructions on these issues were improper and (2) if so, whether the scope of federal preemption extends to bar evidence of adequacy of warning devices, excessive train speed and "local hazard conditions," which is offered for purposes of comparative negligence and punitive damages; (3) whether the trial court erred in instructing the jury to analyze the negligence of the parties on the basis of Oklahoma law of comparative negligence; and (4) whether the trial court erred in denying Railroad's motion for a directed verdict on the issues of liability and punitive damages. I FACTS AND PROCEDURAL HISTORY ¶2 William Franklin Pearl, a resident of LeFlore County, Oklahoma, was driving his 1997 pickup truck home subsequent to a shopping trip at 1 p.m. on December 16, 1997, whereupon his truck was struck by a train owned by Railroad and operated by its employees/Defendants Locke and Hinds, as Pearl was driving over the Pickering Street railway grade crossing in Mena, Arkansas. The crossing in question was a one-lane crossing and signs at the crossing included two reflectorized crossbucks warning signs ¶3 This personal injury action was instituted on March 4, 1998 in the District Court of LeFlore County, in which Pearl sought compensatory damages for Defendants' negligence and punitive damages for "gross and especially egregious negligence." Pearl's negligence claims are as follows ¶4 On March 22, 1999, The Railroad filed a Motion for Partial Summary Judgment with respect to Plaintiff's negligence claims numbers 2 through 4, which were all negligence theories based upon issues of excessive train speed, the "ultra hazardous crossing" (adequacy of warning) claim, the audible warning signal claim and the "specific, individualized hazard" claim. The Railroad argued these theories of negligence were preempted by federal law. The trial court denied the Railroad's motion in part ¶5 This case was tried to a jury in October, 1999, which returned a verdict in favor of Defendants Locke and Hinds, but found that the Railroad was negligent in causing Pearl's injuries and awarded Pearl $1 million in compensatory damages. The jury determined that Pearl was also negligent, and apportioned the loss as 40 per cent attributable to him and 60 per cent attributable to the Railroad. Subsequent to a second-stage proceeding, the jury found the Railroad acted wilfully, wantonly and in reckless disregard for the rights of others and awarded Pearl $100,000 in punitive damages. Judgment was entered on the jury verdict and the Railroad appealed. ¶6 The Court of Civil Appeals, Division IV (COCA) affirmed in part, reversed in part, and remanded for a new trial, holding that the trial court erred in instructing the jury regarding the adequacy of the warning devices, excessive train speed and on "local hazard conditions," as these claims were preempted by federal law. However, the COCA concluded that preemption does not extend to bar evidentiary proof of these theories for purposes of comparative negligence and punitive damages. Additionally, the COCA determined that upon remand, the jury should be instructed on Arkansas comparative negligence law rather than Oklahoma law. Further, the COCA affirmed the trial court's denial of Railroad's Motion for Directed Verdict on the issues of liability and punitive damages. II THE JURY INSTRUCTIONS ¶7 Review of trial court instructions is governed by [n]o judgment shall be set aside or new trial granted by any appellate court of this state in any case . . . on the ground of misdirection of the jury or for error in any matter of pleading or procedure, unless it is the opinion of the reviewing court that the error complained of has probably resulted in a miscarriage of justice, or constitutes a substantial violation of a constitutional or statutory right. Id. ¶8 In this case, the jury was instructed on the abnormally dangerous nature of the crossing/adequacy of warning devices ¶9 The Railroad additionally argued, and the COCA agreed, that the trial court erred in instructing the jury on the issue of comparative negligence according to Oklahoma law instead of Arkansas law. ¶10 This Court has held "that the rights and liabilities of parties with respect to a particular issue in tort should be determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties." Brickner v. Gooden, ¶11 In Brickner, this Court expressly abandoned the lex loci delicti rule (the law of the place of the wrong), which previously determined the applicable substantive law for tort actions brought in Oklahoma. Id. To determine the state with the most significant relationship to the occurrence and the parties, the Brickner case identified four factors to be considered "according to their relative importance with respect to a particular issue" as follows: "(1) the place where the injury occurred, (2) the place where the conduct causing the injury occurred, (3) the domicile, residence, nationality, place of incorporation and place of business of the parties, and (4) the place where the relationship, if any, between the parties occurred." Id. ¶12 In this case, the motor vehicle-train collision occurred in Arkansas. However, both Mr. Pearl and his guardian, Juanita Hightower, as well as Defendants J.T. Locke and Jerry Hinds are all residents of LeFlore County, Oklahoma. Thus, all individual parties to this lawsuit reside in Oklahoma. At the time of the collision, Mr. Pearl was driving home from a shopping trip, which had begun in Oklahoma and was to end in Oklahoma. Although the Railroad owns property located in LeFlore County, Oklahoma, the Railroad's state of incorporation and its principal place of business is in a state other than Oklahoma or Arkansas. The train at issue in this case was stationed out of Heavener, Oklahoma. Further, at the time of the collision in this case, the train was traveling on a trip, which began in Oklahoma and was scheduled to return to Oklahoma. ¶13 The Railroad urges an application of the "most significant relationship test" that would result in resurrection of the lex loci delicti rule, as it argues there is no other significant relationship between the parties in this case other than the fact they were each involved in the accident in Arkansas. The Railroad urges a construction of the test that focuses upon the fact the collision occurred in Arkansas as the sole factor in the determination of which state's law has the most significant relationship to the occurrence and the parties. However, the proper consideration of the other Brickner factors indicates it is Oklahoma law, which clearly has the most significant relationship to the occurrence and the parties in this case with respect to negligence and comparative negligence. ¶14 The Brickner case arose out of an airplane crash, which occurred in Mexico. The injured passengers brought actions against the individual owner and operator of the airplane for personal injuries sustained in the crash. In its application and evaluation of the various factors in Brickner, this Court noted that "all the parties were and still are residents of Oklahoma; the aircraft was hangared and registered in Oklahoma; and the trip originated and was to end in Oklahoma." Id. at 638. While the Brickner Court acknowledged that the Republic of Mexico "would be concerned with the conduct of the parties while they were within its borders and the accident occurred in Mexico," it noted that "'it would seem rather undesirable that the rights and obligations of the parties should be subject to change as the aircraft crossed the boundary lines of each jurisdiction.'" Id. Thus, the Brickner Court determined that Oklahoma had the most significant relationship to the occurrence and the parties in that case and that Oklahoma law, rather than the law of Mexico, would therefore apply in that case. ¶15 The facts and application of the factors in Brickner are directly analogous in the instant case. Just as in Brickner, all individual parties in this case are residents of Oklahoma. Additionally, just as the aircraft in Brickner was hangared in Oklahoma, the train in this case was stationed out of Heavener, Oklahoma and both the train and Mr. Pearl were each originating their respective trips from Oklahoma and likewise, each were planning on ending their respective trips in Oklahoma on the day of the collision. In this case, it would likewise "seem rather undesirable that the rights and obligations of the parties should be subject to change as the [train] crossed the boundary lines of each jurisdiction." Id. Thus, pursuant to the rule in Brickner, the laws of Oklahoma have the most significant relationship to the occurrence and the parties and Oklahoma law of negligence and comparative negligence should therefore apply to determine the parties' rights and liabilities in this case. Upon remand, the trial court shall apply Oklahoma law on negligence and comparative negligence when it instructs the jury. III FEDERAL LAW PREEMPTS PEARL'S THEORIES OF NEGLIGENCE PREMISED UPON INADEQUATE WARNING DEVICES, EXCESSIVE TRAIN SPEED AND LOCAL HAZARD CONDITIONS Background on the Federal Law Relating to Railroad Safety ¶16 The Federal Railroad Safety Act of 1970 (FRSA), 45 U.S.C. §§421-447 (now codified at 49 U.S.C. § 20101 (2000), et seq.) was enacted for the express purpose of "promot[ing] safety in every area of railroad operations and reduc[ing] railroad-related accidents and incidents." 45 U.S.C. § 421 (49 U.S.C. § 20101). Additionally, the FRSA directed the Secretary of Transportation to address safety problems at grade crossings and was given broad powers to "prescribe regulations and issue orders for every area of railroad safety." 45 U.S.C. § 431(a) (49 U.S.C. § 20103(a)). This legislation expressly provides for the federal preemption of State law as follows: Laws, regulations, and orders related to railroad safety shall be nationally uniform to the extent practicable. A State may adopt or continue in force a law, regulation or order related to railroad safety until the Secretary of Transportation prescribes a regulation or issues an order covering the subject matter of the State requirement. 45 U.S.C. § 434 (49 U.S.C. § 20106). This Act also contains an express "savings clause," which provides as follows: A State may adopt or continue in force an additional or more stringent law, regulation, or order related to railroad safety when the law, regulation, or order- (1) is necessary to eliminate or reduce an essentially local safety hazard; (2) is not incompatible with a law, regulation, or order of the United States government; and (3) does not unreasonably burden interstate commerce. Id. ¶17 In 1973, the Highway Safety Act was enacted, which created the Federal Railway-Highway Crossings Program (The Crossings Program). 23 U.S.C. § 130 (2000). The Crossings Program makes federal funds available to the States for improvement and elimination of hazards at grade crossings on the condition of States' "maint[enance of] a survey of all highways to identify those railroad crossings which may require separation, relocation, or protective devices, and establish and implement a schedule of projects for this purpose." 23 U.S.C. § 130(d). A. Excessive Train Speed ¶18 Two of Pearl's four negligence theories are based upon the premise that the train in question was traveling at an excessive speed at the time of the accident. Pearl specifically claims that the train was exceeding the federally mandated speed limit at the crossing (hereinafter the "excessive speed claim") and the Railroad was exceeding a safe speed in light of the specific, individualized hazard the Railroad had created at the crossing. ¶19 It is undisputed that the train at issue in this case was traveling 40 miles per hour at the time of the accident. Further, the record reflects that at the time of the accident, the track was classified pursuant to federal regulation as a Class 3 track, which has a maximum allowable speed of 40 miles per hour. ¶20 Since the train was traveling within the speed limit established in the federal regulations, Pearl's common law negligence claims premised upon excessive train speed are therefore preempted by federal law. The Federal Railroad Safety Act of 1970 (FRSA), 45 U.S.C. §§421-447 expressly preempts all Pearl's claims based upon excessive train speed. Further, the U.S. Supreme Court has held that the maximum allowable speeds codified at 49 C.F.R. § 213.9(a) "cover[] the subject matter of train speed with respect to track conditions, including conditions posed by grade crossings," and therefore, preempt common law tort claims asserting the train traveled at an excessive rate of speed. CSX Transp., Inc. v. Easterwood, ¶21 Pearl has sought to circumvent federal preemption by arguing that the track should have been classified at a lower classification and therefore, a lower speed limit should have been applicable at the time of the accident. Pearl argued that the jury was entitled to determine the class of track and its corresponding speed limit. The trial court agreed and instructed the jury on this issue. The COCA held the trial court erred in giving this instruction and this Court agrees. The federal regulations explicitly place the responsibility of the determination whether to lower a track's classification (and the track's corresponding speed limit) upon either a Federal Railroad Administration Track Inspector or a State Track Inspector. 49 C.F.R. § 216.5(a). That regulation provides in pertinent part as follows: When an FRA Track Inspector or State Track Inspector determines that track does not comply with the requirements for the class at which the track is being operated . . . he notifies the railroad in writing that the track is being lowered in class and that operations over that track must comply with the speed limitations prescribed in part 213 of this chapter. 49 C.F.R. § 216.5(a). Pursuant to this federal authority, the determination of whether to lower the track classification and its corresponding speed limit is clearly for the FRA track inspector and/or State Track Inspector rather than a question of fact for the jury. "Federal law provides. . . the decision to downgrade a track belongs to the FRA track inspector." Stevenson v. Union Pac. R.R. Co., 110 F. Supp. 2d 1086 , 1092 (E.D. Ark. 2000). ¶22 In Stevenson, the plaintiffs argued that a track should have been downgraded and a corresponding lower speed limit should have been implemented prior to the motor vehicle-train accident at issue in that case due to "a number of track conditions found in the area including the specific local hazard." Id. at 1091. The Stevenson court rejected this argument, reasoning that "Plaintiffs are attempting to reclassify the track after the fact. This is an impermissible collateral attack on the regulatory process." Id. In this case, the record is absent any evidence of either a FRA Track Inspector and/or State Track Inspector's determination that the track in question did not meet the requirements of a class 3 track. Further, there is no evidence of any written notification to the Railroad of any federal or state inspector's determination in this case that a lowering in track classification was warranted. In fact, The Federal Railroad Administration inspection report of January 22, 1997 B. The "Local Hazard" Claim/Specific, Individual Hazard Exception ¶23 Pearl additionally argues that the crossing presented a "specific, individualized hazard" that required the train's speed to be reduced as it approached the crossing. As noted above, federal preemption under § 20106 of excessive train speed claims is not absolute, as the statute contains an express "savings clause." The U.S. Supreme Court has held that common law speed restrictions are not preserved by the "savings clause" within the federal statute, the terms of which allows States to "adopt or continue in force an additional or more stringent law. . . related to railroad safety when the law. . . is necessary to eliminate or reduce an essentially local safety hazard." CSX Transp., Inc. v. Easterwood, ¶24 Pursuant to Easterwood and upon consideration of "the various views espoused in its progeny," this Court in Myers held "that a specific, individual hazard is a person, vehicle, obstruction, object, or event which is not a fixed condition or feature of the crossing and which is not capable of being taken into account by the Secretary of Transportation in the promulgation of uniform, national speed regulations." Myers, Hazards posed by track conditions, including those existing at grade crossings, are capable of being taken into account by the Secretary and are covered by the federal speed regulations. Factors such as general knowledge that a crossing is dangerous, traffic conditions, a crossing's accident history, sight distances, multiple crossings in close proximity, sun glare, a railroad's internal policies regarding speed, and inadequate signal maintenance are not specific, individual hazards. Id. ¶25 In this case, Pearl argues the Railroad's alleged failure to "keep a promise" regarding its increase of train speeds and corresponding adjustment of warnings it would provide motorists driving over crossings in Mena, Arkansas amounts to a "specific, individualized hazard." ¶26 The record reveals that Pearl's "specific, individual hazard" theory is based entirely on the Railroad's internal speed regulations, which set a lower speed limit than the maximum allowable speed limit mandated by federal law, as referenced in a letter the Railroad's General Superintendent sent to the Mayor of Mena, Arkansas on November 11, 1997 regarding the Railroad's internal policies. C. The Inadequate Warning Device Theory ¶27 Pearl's fourth negligence theory is premised upon the Railroad's alleged failure to provide an adequate warning to motorists of the presence of an approaching train in light of the abnormally dangerous nature of the crossing (hereinafter "the inadequate warning" claim). As discussed supra in introduction to Part III of this opinion, federal regulations implementing the Crossings Program addressed the design of grade crossing improvements. 23 C.F.R. § 646.214 (b). These regulations specify what constitutes "adequate warning devices," which must be installed at crossings "where Federal-aid funds participate in the installation of the devices." §§ 646.214(b)(3) and (4). The U.S. Supreme Court has held that when federal funds participate in the crossing improvement project, these regulations "establish a standard of adequacy that 'determines the devices to be installed.'" Norfolk S. Ry. Co. v. Shanklin, ¶28 In Easterwood, the U.S. Supreme Court determined that the federal regulations were inapplicable in that case because although federal funds had been obtained for placement of warning devices at the crossing in question, those warning devices were never actually installed. Easterwood, ¶29 The record reflects that pursuant to an Arkansas Crossings Improvement Program in 1980, federal funds were used to install the crossbucks warning signs at the Pickering Street Crossing and that such warning signs remained present at the crossing at the time of the collision in the instant case. The record also reflects that this use of federal rail-highway monies for this project was approved by the Federal Highway Administration, thus satisfying the conditions of § 646.214 (b)(4). IV EVIDENCE PERTINENT TO PREEMPTED THEORIES OF NEGLIGENCE ¶30 Although the COCA correctly determined that Pearl's claims based on inadequate warnings, excessive train speed and "local hazard conditions"/"local safety hazard" ¶31 The express preemption provision contained in the FRSA calls for "nationally uniform" laws "related to railroad safety," but permits states to "adopt or continue in force a law, regulation or order related to railroad safety until the Secretary of Transportation prescribes a regulation or issues an order covering the subject matter of the State requirement." 49 U.S.C. § 20106 (emphasis added). The U.S. Supreme Court has held that where the federal regulations at 23 C.F.R. §§ 646.214(b)(3) and (4) and 49 C.F.R. § 213.9 apply, they cover "the subject matter of the relevant state law" relating to railroad safety. CSX Transp. Inc. v. Easterwood, ¶32 Specifically with respect to preemption of state law on the subject of adequacy of warning devices, the U.S. Supreme Court has held that "[w]hen the FHWA approves a crossing improvement project and the State installs the warning devices using federal funds, §§ 646.214(b)(3) and (4) establish a federal standard for the adequacy of those devices that displaces state tort law addressing the same subject." Norfolk S. Ry. Co. v. Shanklin, ¶33 Likewise, with respect to the evidence regarding excessive train speed, the provisions of 49 C.F.R. § 213.9 establish the maximum speeds trains are permitted to travel given the classification of the track on which they operate. The U.S. Supreme Court has held the federal "speed limits must be read as not only establishing a ceiling, but also precluding additional state [law] such as "the common-law duty to operate [a train at] a moderate and safe rate of speed." Easterwood, ¶ ¶35 Pursuant to these authorities, we hold that federal law preempts evidence regarding adequacy of warning devices, excessive train speed and/or the alleged "local hazard conditions,"31 which is offered for the purpose of proof of a state law tort claim for punitive damages and/or the issue of comparative negligence. Such evidence is part of the relevant state law substantially subsumed by federal regulations regarding railway safety and is thereby preempted. ¶36 If we were to permit Pearl to introduce evidence at trial regarding the adequacy of warning devices on the issue of the Railroad's comparative negligence defense and/or punitive damages claim, this would amount to an impermissible challenge of the federal standard of adequacy of warning devices.32 If Pearl were likewise allowed to challenge the federal maximum speed limit by submission of evidence regarding the train's alleged excessive speed on the issues of comparative negligence and/or punitive damages, the jury would be permitted to improperly supplant its determination of train speed limits for that of the Secretary of Transportation. Allowing the jury to apportion the parties' relative fault and/or determine the propriety of punitive damages on the basis that the train was traveling at an excessive rate of speed would "completely deprive the Secretary of the power to pre-empt state common law." Easterwood, 507 U.S. at 675. ¶37 To allow Pearl to admit evidence that would permit the jury to apportion the Railroad's fault on the basis of such a challenge is akin to allowing Pearl to improperly submit a claim for negligence based upon adequacy of warnings, excessive train speed and alleged dangerous conditions of the crossing.33 Where such negligence claims are preempted, evidence pertinent to such claims is likewise inadmissible when offered for purposes of proof of culpability.34 See Mickelson v. Montana Rail Link, Inc., 299 Mont. 348, 999 P.2d 985 (2000); See also Pitasi v. Stratton Corp., 968 F.2d 1558, 1561 (2d Cir. 1992) (holding that evidence regarding subsequent remedial measures inadmissible "to prove negligence or culpable conduct," but admissible to rebut contributory negligence defense where it would otherwise be "impossible for [plaintiff] to rebut defendant's argument that [plaintiff] was contributorily negligent."). This case is distinguishable from Pitasi, as the possibility remains for Pearl to rebut the Railroad's affirmative defense of comparative negligence despite the exclusion of evidence pertinent to warnings, train speed and alleged "local hazard" conditions. Pearl may still offer evidence pertinent to the vegetation claim in rebuttal to the Railroad's comparative negligence defense. ¶38 Finally, to allow Pearl to admit evidence regarding the adequacy of the warning devices and excessive train speed on the issue of punitive damages would permit the jury to punish a Railroad for complying with the applicable federal standards for warning devices at crossings and train speed. This not only offends logic, it is contrary to the law of federal preemption. V SUMMARY ¶39 While we recognize the COCA correctly determined that Pearl's state law negligence theories based upon adequacy of the warning devices, excessive train speed and "local hazard conditions" are preempted by federal law and that the trial court erred in instructing the jury on these issues, we vacate the COCA's opinion on other grounds. In accordance with federal law, U.S. Supreme Court case law and pursuant to precedent of this Court, we hold that the scope of federal preemption under the Federal Railroad Safety Act and regulations promulgated pursuant thereto, extends to bar evidence of adequacy of warning devices, excessive train speed and allegedly hazardous conditions existing at grade crossings when such evidence is offered for purposes of comparative negligence and punitive damages. Further, we uphold the trial court's instruction to the jury to analyze the negligence of the parties on the basis of Oklahoma law of negligence and comparative negligence in light of Oklahoma law's most significant relationship to the occurrence and the parties and remand for new trial to be held solely on Pearl's vegetation claim. Finally, we uphold the trial court's denial of the Railroad's motion for a directed verdict on the issues of liability and punitive damages. ¶40 Upon certiorari previously granted, THE COURT OF CIVIL APPEALS' OPINION IS VACATED; THE DISTRICT COURT'S JUDGMENT IS REVERSED; AND THE CAUSE IS REMANDED FOR FURTHER PROCEEDINGS NOT INCONSISTENT WITH TODAY'S PRONOUNCEMENT. ¶41 OPALA, V.C.J., HODGES, LAVENDER, HARGRAVE, KAUGER, SUMMERS, BOUDREAU and WINCHESTER, JJ., concur. ¶42 WATT, C.J., concurs in part; dissents in part. FOOT