Title: Delta Air Lines, Inc. v. Ageloff

State: florida

Issuer: Florida Supreme Court

Document:

552 So. 2d 1089 (1989)
DELTA AIR LINES, INC., Defendant-Appellant,
v.
Harold AGELOFF, et al., Plaintiffs-Appellees.
No. 73729.

Supreme Court of Florida.
October 26, 1989.
Rehearing Denied December 26, 1989.
Thomas E. Ice of Barwick, Dillian, Lambert & Angel, P.A., Miami Shores, for defendant-appellant.
Philip M. Burlington of Edna L. Caruso, P.A., and Robert M. Montgomery, Jr. of Montgomery and Larmoyeux, West Palm Beach, for plaintiffs-appellees.
GRIMES, Justice.
Pursuant to section 25.031, Florida Statutes (1987), and Florida Rule of Appellate Procedure 9.150, the United States Court of Appeals for the Eleventh Circuit has certified to this Court certain questions concerning the Florida Wrongful Death Act. We have jurisdiction. Art. V, § 3(b)(6), Fla. Const.
The joint statement of facts which was submitted together with the certified questions states:
Ageloff v. Delta Air Lines, Inc., 867 F.2d 1268, 1269-71 (11th Cir.1989) (footnote omitted).
The court of appeals certified the following questions:
Id. at 1271 (footnote omitted).
As worded, the answer to question 1(a) appears to be answered by the explicit language of the Wrongful Death Act. Section 768.18(5) provides:
(Emphasis added.) As we recently explained in Wilcox v. Leverock, 548 So. 2d 1116 (Fla. 1989), income from investments in which the decedent had an interest at his death is passive income which continues to accrue regardless of his skill or efforts. The untimely death deprives neither the decedent's estate nor his survivors of the income from these investments. Thus, we answer question 1(a) in the negative.
Whereas we presupposed that question 1(a) involves investments that the decedent made before his death, question 1(b) involves a wholly different proposition: income from investments that the decedent would have made with his anticipated savings, had he lived. Ageloff contends that by excluding income on "investments continuing beyond death," the statute only intended to prevent the recovery of interest on the decedent's actual investments, and not those which could have been made had he not died. Delta argues that by excluding "income from investments continuing beyond death," the legislature meant to exclude income derived from acts of investing which continue beyond death. Delta further contends that if anticipated future investment income is computed in net accumulations, *1092 the survivors not only would receive the money the decedent would have earned by investing savings but would also have the ability to earn interest on those funds.
The logic of excluding from net accumulations the income from investments in which the decedent had an interest at the time of his death is evident. The income will continue to accumulate regardless of the decedent's efforts. Therefore, there has been no loss to the decedent's estate or his survivors. On the assumed facts of this case, however, the absence of the decedent makes a great deal of difference. Because of his death, there are no earnings from which funds can be saved with which to buy investments that would generate additional income. If the decedent had lived and acquired investments from savings on his earnings, the income from these investments would have enhanced the value of his estate had he lived his normal life span. Under these circumstances, the estate and the survivors are deprived of the income on these investments.
In keeping with the legislative admonition that the Wrongful Death Act is remedial and shall be liberally construed, section 768.17, Florida Statutes (1987), we hold that the investment return on future savings of a decedent is not excluded from net accumulations. Delta's argument relies on the faulty premise that the present value of net accumulations should be computed in the same manner as determining an award for impaired earning capacity on an annual basis. However, the recovery of net accumulations does not occur on an annual basis, but only once at the end of the decedent's life expectancy. Net accumulations are more than replacement salary. They are supposed to represent what the decedent's estate would have been worth at death. This sum is reduced to present value so that it can be reinvested by the survivors, with the intention that when the estimated natural death of the decedent occurs the estate will equal what it would have been worth had he not died. If it can be proved that the decedent would have earned income from savings, it is not a double recovery for the survivors to recover this lost income. We answer question 1(b) in the negative.
The second certified question asks how inflation should be taken into account for purposes of determining the present value of net accumulations under the Wrongful Death Act. Courts have long recognized that future inflation can substantially affect the determination of the present value of damage awards. There are three recognized methods for taking into account the effect of inflation. These were described in Culver v. Slater Boat Co., 722 F.2d 114, 118 (5th Cir.1983), cert. denied, 469 U.S. 819, 105 S. Ct. 90, 83 L. Ed. 2d 37 (1984), as follows:
(Footnotes omitted.) In order to simplify matters and to provide more certainty, the Culver majority determined that federal courts within its jurisdiction should thereafter employ the below-market-discount method. Recognizing, however, that this litigation is a diversity case in which state law controls, the Eleventh Circuit Court of Appeals has now chosen to request this Court's advice concerning Florida law.
The only prior Florida decision bearing on this issue is Seaboard Coast Line Railroad v. Garrison, 336 So. 2d 423 (Fla.2d DCA 1976). That decision posed the question of whether expert testimony concerning future inflationary trends was admissible as the basis to determine the estimated value of loss of future support for a decedent's survivor. In holding that the expert's testimony was admissible, the court reasoned that to require the finder of fact to ignore evidence of reasonably predictable inflationary trends was inconsistent with the realities of present-day economics. The court concluded:
Id. at 425 (footnote omitted).
In Jones & Laughlin Steel Corp. v. Pfeifer, 462 U.S. 523, 103 S. Ct. 2541, 76 L. Ed. 2d 768 (1983), the United States Supreme Court discussed at length the several methods by which the effect of future inflation is considered. After pointing out the advantages and shortcomings of each of the methods, the Court stated:
Id. at 546-47, 103 S. Ct.  at 2555.
Likewise, we decline to adopt a particular method for taking into account the effect of inflation upon the determination of prospective net accumulations. If economists are unable to agree on the subject, we doubt that this Court has the expertise to select one method over another. However, we leave open the possibility that at some future date this Court may adopt a particular method after receiving the expert advice of appropriate committees and other interested persons. We answer certified question number 2 by stating that at the present time no particular method for determining future inflationary effects on prospective net accumulations is required under Florida's Wrongful Death Act. Though not required to do so, the parties are at liberty to present expert testimony which employs any recognized method.
*1094 Having answered the certified questions, we return the record to the United States Court of Appeals for the Eleventh Circuit.
It is so ordered.
OVERTON, Acting C.J., and McDONALD, SHAW and KOGAN, JJ., concur.
EHRLICH, C.J., and BARKETT, J., did not participate in this case.