Source: https://law.justia.com/cases/federal/appellate-courts/F2/960/754/349887/
Timestamp: 2020-08-05 23:04:57
Document Index: 267129244

Matched Legal Cases: ['§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 25', '§ 18', '§ 25']

Prod.liab.rep. (cch) P 13,144norwest Bank Nebraska, N.a., Appellant, v. W.r. Grace & Co.--conn., Appellee, 960 F.2d 754 (8th Cir. 1992) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Eighth Circuit › 1992 › Prod.liab.rep. (cch) P 13,144norwest Bank Nebraska, N.a., Appellant, v. W.r. Grace & Co.--conn., App...
Prod.liab.rep. (cch) P 13,144norwest Bank Nebraska, N.a., Appellant, v. W.r. Grace & Co.--conn., Appellee, 960 F.2d 754 (8th Cir. 1992)
US Court of Appeals for the Eighth Circuit - 960 F.2d 754 (8th Cir. 1992) Submitted Dec. 13, 1991. Decided April 6, 1992
In 1978, Nebraska enacted a statute governing numerous aspects of product liability actions, including time bars for bringing those actions. Neb.Rev.Stat. § 25-224 (Reissue 1989). Subsection 1 provides that " [a]ll product liability actions ... shall be commenced within four years next after the date on which the death, injury, or damage complained of occurs." Subsection (2) provides that " [n]otwithstanding subsection (1) ... any product liability action ... 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." § 25-224(2). The statute further provides that "any cause of action or claim which any person may have on July 22, 1978 [the effective date of the statute], may be brought not later than two years following such date." § 25-224(4).
In Daley v. Webb, 885 F.2d 486 (8th Cir. 1989), this court held that the appellant's claim "that he was not afforded adequate procedural due process" in the administrative proceedings through which his employment was terminated, "is not properly before us, as it was not raised in the District Court." Id. at 488. The court pointed out that "at no time was the trial judge or the jury given an opportunity to consider this claim." Id. The court stated:
Although in Daley the due process claim had not been raised at all in the district court, we think the same principle applies in the present case, where Norwest did not raise in the district court the federal due process constitutional claim it now asserts before us, but raised only a state due process contention. Different law governs the two constitutional claims: Federal law determines the federal claims and Nebraska law governs the state claims; moreover, although the language of the federal and state due process clauses may be identical, their substantive content and scope may be different. Cf. National Capital Naturists, Inc. v. Board of Supervisors, 878 F.2d 128, 133 (4th Cir. 1989) ("The fact that language in a state constitution may parallel that in the United States Constitution is no reason to suppose that the lines of decisional authority under those provisions will invariably be identical.").
The governing standard for determining the validity of a state statutory classification that does not create a suspect class is that a state statute does not violate the Equal Protection Clause if the classification has a "rational basis" or is "rationally related to a legitimate state interest." New Orleans v. Dukes, 427 U.S. 297, 303, 96 S. Ct. 2513, 2517, 49 L. Ed. 2d 511 (1976); Cornerstone Bible Church v. City of Hastings, 948 F.2d 464, 471 (8th Cir. 1991). Furthermore, a statutory classification
does not offend the Constitution simply because the classification "is not made with mathematical nicety or because in practice it results in some inequality." Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61, 78 [31 S. Ct. 337, 340, 55 L. Ed. 369 (1911) ]. "The problems of government are practical ones and may justify, if they do not require, rough accommodations--illogical it may be, and unscientific." Metropolis Theatre Co. v. City of Chicago, 228 U.S. 61, 69-70 [33 S. Ct. 441, 443, 57 L. Ed. 730 (1913) ]. "A statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it." McGowan v. Maryland, 366 U.S. 420, 426 [81 S. Ct. 1101, 1105, 6 L. Ed. 2d 393 (1961) ].
Dandridge v. Williams, 397 U.S. 471, 485, 90 S. Ct. 1153, 1161, 25 L. Ed. 2d 491 (1970).
Norwest identifies the legislative goal of § 25-225(2) as "assist [ing] consumers and industry through an attempt to hold down the very rapidly increasing premium rates for product liability insurance. L.B. 142, Hearings at 7." The Nebraska Legislature sought to achieve that goal by barring product liability actions commenced more than ten years after the product is first sold or leased. Another possible legislative purpose may have been to curb what the state viewed as an excessive number of product liability actions that might discourage sales or leases within the state. We cannot say that restricting the limitations period to suits against manufacturers, sellers and lessors has no rational basis or is not rationally related to the state's interests.
The Supreme Court has stated that, under rational basis review of state legislation, "the Equal Protection Clause allows the States wide latitude, ... and the Constitution presumes that even improvident decisions will be rectified by the democratic process." Cleburne v. Cleburne Living Center, Inc., 473 U.S. 432, 440, 105 S. Ct. 3249, 3254, 87 L. Ed. 2d 313 (1985) (citations omitted).
As we have held above, it was reasonable for the Nebraska legislature to conclude that placing a time bar on product liability actions would result in lower insurance premiums. Even if the Legislature knew that rates were calculated on a national basis, it might well have concluded that other states would enact similar statutes governing product liability suits, and that the presence of these statutes in multiple jurisdictions would have a cumulative impact on national insurance premiums. This is certainly a "state of facts [which] reasonably may be conceived to justify [the statute]." McGowan v. Maryland, 366 U.S. 420, 426, 81 S. Ct. 1101, 1105, 6 L. Ed. 2d 393 (1961).
In view of the "wide latitude" that the Equal Protection Clause allows the Nebraska Legislature, we cannot say it was irrational for the legislature to enact § 25-224. Norwest's challenge based on the national nature of insurance rates attacks the wisdom of the legislature in enacting the statute, and not the rationality of the relationship between the statute and its purpose. Whether this statute is the most effectual means for achieving the legitimate legislative goal of lower insurance rates is for the legislature, and not the courts, to determine. See Dandridge, 397 U.S. at 486-87, 90 S. Ct. at 1162.
A. The preliminary question in any due process analysis is whether the party challenging the statute has a property interest that that statute protects. Carolan v. City of Kansas City, 813 F.2d 178, 181 (8th Cir. 1987). Nebraska law determines the nature and extent of Norwest's cause of action as a right protected by the Nebraska due process clause. Id.; Bishop v. Wood, 426 U.S. 341, 344 n. 7, 96 S. Ct. 2074, 2077 n. 7, 48 L. Ed. 2d 684 (1976); Board of Regents v. Roth, 408 U.S. 564, 577, 92 S. Ct. 2701, 2709, 33 L. Ed. 2d 548 (1972).
Although the Nebraska Supreme Court has not specifically addressed the issue, it appears that under Nebraska law only a judgment, but not the underlying cause of action on which the judgment is based, is a property right that the state due process clause protects. In Karrer v. Karrer, 190 Neb. 610, 211 N.W.2d 116, 119 (1973), the Nebraska Supreme Court, holding that " [s]tatutes may not operate retroactively so as to impair vested rights," stated that " [p]rivate rights of parties which have vested by the judgment of a court cannot be taken away by subsequent legislation...." More recently, that Court stated that " [j]ust as a judgment is a vested right which cannot be impaired by a subsequent legislative act, ... so, too, is immunity granted by a completed statutory bar," and that " [t]he immunity afforded by a statute of repose is a right which is as valuable to a defendant as the right to recover on a judgment is to a plaintiff; the two are but different sides of the same coin.... These are substantive rights recognized by Nebraska law and protected by its Constitution." Givens v. Anchor Packing, 237 Neb. 565, 466 N.W.2d 771, 773-74 (1991). See also Spilker v. City of Lincoln, 238 Neb. 188, 469 N.W.2d 546, 548-49 (1991); State Sec. Co. v. Norfolk Livestock Sales Co., 187 Neb. 446, 191 N.W.2d 614, 617 (1971) ("A person has no property--no vested interest--in any rule of the common law.").
Section 25-224 did not impair existing substantive rights, but "merely affect [ed] the procedure by which such rights may be enforced." The statute requires that all product liability actions be commenced within four years after the date on which the injury occurs, § 25-224(1), but also requires such an action to be commenced within ten years after the date when the offending product was first sold or leased for use or consumption. § 25-224(2). The statute also provides a two-year period following its effective date during which persons having claims on the effective date could bring suit. § 25-224(4).
Even accepting Norwest's claim that it was unable to discover facts enabling it to bring suit until after the limitations period had run, § 25-224 survives constitutional scrutiny. As the Nebraska Supreme Court stated in Colton v. Dewey, 212 Neb. 126, 321 N.W.2d 913, 916 (1982), " [n]or does due process demand an awareness of a right of action before a period of limitations has run against it." While that Court has held that "the 4-year statute of limitations set forth in § 25-224(1) begins to run on the date on which the party holding the cause of action discovers, or in the exercise of reasonable diligence should have discovered, the existence of the injury or damage," Condon v. A.H. Robins Co., 217 Neb. 60, 349 N.W.2d 622, 627 (1984), nothing in the Nebraska cases indicates that this rule applies to the ten year statute of repose in § 25-224(2), which bars all actions commenced more than ten years after the product was first sold or leased for use or consumption.
The Nebraska Supreme Court has stated: "A party claiming a statute is unconstitutional has the burden to show and clearly demonstrate that the questioned statute is unconstitutional.... In every constitutional challenge there attaches the presumption that all acts of the Legislature are constitutional, with all reasonable doubts resolved in favor of constitutionality." Spilker, 469 N.W.2d at 548 (upholding § 25-224 against state constitutional challenges) (citation omitted). " [U]nder the provisions of Neb. Const.... art. III, § 18, the Legislature may make a reasonable classification of persons for purposes of legislation concerning them, but ... the classification must rest upon real difference of situation and circumstances surrounding the members of the class, relative to the subject of the legislation, which render the enactment appropriate." Colton, 321 N.W.2d at 916. (upholding Neb.Rev.Stat. § 25-222 against "special legislation" clause challenge).
The title announces that the statute "relat [es] to product liability actions" and indicates that the act provides immunity. As the Nebraska Supreme Court has held, "it is not necessary for the title to analyze the bill in detail and it is not necessary that the title inform the readers of the specific contents of the bill." State v. Levell, 181 Neb. 401, 149 N.W.2d 46, 51 (1967). Moreover, the purpose of a title is "to describe the subject, not to synopsize the contents or every conceivable consequence." Hall v. Simpson, 184 Neb. 762, 171 N.W.2d 805, 807 (1969).