Opinion ID: 1786265
Heading Depth: 1
Heading Rank: 3

Heading: Judicial Estoppel and Lex Loci Delicti

Text: Our review of the summary judgment in this case is based upon the principle of lex loci delicti, under which the courts of this state will determine the substantive rights of an injured party according to the law of the state where the injury occurred. Fitts v. Minnesota Mining & Mfg. Co., 581 So.2d 819, 820 (Ala.1991). For 115 years, the principle of lex loci delicti has governed cases such as this one in Alabama courts. Fitts, 581 So.2d 819 (reaffirming the doctrine of lex loci delicti and declining to adopt the most significant relationship approach of the Restatement (Second) of Conflict of Laws (1971)); Alabama Great Southern R.R. v. Carroll, 97 Ala. 126, 11 So. 803 (1892). Although lex loci delicti governs substantive law, lex fori the law of the forumgoverns procedural matters. `The distinction between substance and procedure has medieval origins: a court will apply foreign law only to the extent it deals with the substance of the case, i.e., affects the outcome of the litigation, but will rely on the forum law to deal with the procedural aspects of the litigation.' Etheredge v. Genie Indus., Inc., 632 So.2d 1324, 1326-27 (Ala. 1994) (quoting Eugene F. Scoles & Peter Hay, Conflict of Laws 57 (1992)). In its order granting Caterpillar's summary-judgment motion, the trial court determined that the doctrine of judicial estoppel is procedural in nature and, thus, Alabama law applies in this case. On appeal, Middleton argues that the doctrine of judicial estoppel is substantive in nature and that the trial court therefore should have applied the laws of South Carolina relating to the doctrine of judicial estoppel. `The court before which the question arises is the one that has to decide whether any rule of law, domestic or foreign, will be characterized as substantive or as procedural for choice-of-law purposes.' Etheredge, 632 So.2d at 1326 (quoting Robert A. Leflar et al., American Conflicts Law 333 (1986)). The question of whether the doctrine of judicial estoppel sounds in substantive or procedural law is one of first impression for this Court. This Court has defined judicial estoppel in the following manner: `The doctrine of judicial estoppel applies to preclude a party from assuming a position in a legal proceeding inconsistent with one previously asserted. Judicial estoppel looks to the connection between the litigant and the judicial system[,] while equitable estoppel focuses on the relationship between the parties to the prior litigation.' Jinright v. Paulk, 758 So.2d 553, 555 (Ala.2000) (quoting Selma Foundry & Supply Co. v. Peoples Bank & Trust Co., 598 So.2d 844, 846 (Ala.1992), quoting in turn Oneida Motor Freight, Inc. v. United Jersey Bank, 848 F.2d 414 (3d Cir. 1988)). Ex parte First Alabama Bank, 883 So.2d 1236, 1241 (Ala.2003). The United States Court of Appeals for the Seventh Circuit has described the doctrine of judicial estoppel as a hybrid between substance and process that on occasion affects the outcome. Astor Chauffeured Limousine Co. v. Runnfeldt Inv. Corp., 910 F.2d 1540, 1551 (7th Cir.1990). `The substance versus procedure issue arises in four contexts: (1) in application of the conflicts of laws rule that the procedural law of the forum must be applied; (2) in determining whether a retrospective criminal statute is substantive and, therefore, an invalid ex post facto law; (3) under the Erie Doctrine when a federal court is asked to apply a state law; and (4) when the power of a court or legislature to makes rules is in issue.' Schoenvogel v. Venator Group Retail, Inc., 895 So.2d 225, 247 (Ala.2004) (quoting Terry A. Moore, Does the Alabama Supreme Court Have the Power to Make Rules of Evidence?, 25 Cumb. L.Rev. 331, 346 n. 96 (1994-1995)). The issue whether the doctrine of judicial estoppel is substantive or procedural in nature has arisen most often in cases where federal courts have applied state law under the Erie doctrine. However, no consensus exists among the federal circuits as to whether the doctrine of judicial estoppel should be considered substantive or procedural. Some circuits in diversity actions, in which federal procedural law and state substantive law are applied, have held judicial estoppel to be substantive: see, e.g., Original Appalachian Artworks, Inc. v. S. Diamond Assocs., 44 F.3d 925, 930 (11th Cir.1995) (Because this is a diversity case, the application of the doctrine of judicial estoppel is governed by state law.); Follette v. Wal-Mart Stores, Inc., 41 F.3d 1234, 1237 (8th Cir.1994) (When a federal court is sitting in diversity, the preclusive effect of a prior judgment is determined by the preclusion rules of the forum which provided the substantive law underlying the prior judgment.); and Tri-State Generation & Transmission Ass'n, Inc. v. Shoshone River Power, Inc., 874 F.2d 1346, 1363 (10th Cir.1989) (Inasmuch as the application of judicial estoppel in this diversity action goes to the adequacy of Tri-State's legal remedy, we look to the appropriate state law to determine whether judicial estoppel is recognized.). Other circuits have held that the doctrine of judicial estoppel is procedural in nature: see, e.g., Jarrard v. CDI Telecomms., Inc., 408 F.3d 905, 914 (7th Cir.2005) (Although Jarrard's complaint was founded on diversity jurisdiction, we apply federal (not Indiana) caselaw with respect to judicial estoppel.); Johnson v. Oregon Dep't of Human Res., 141 F.3d 1361, 1364 (9th Cir.1998) (Federal law governs the application of judicial estoppel in federal courts.); Pennycuff v. Fentress County Bd. of Educ., 404 F.3d 447, 452 (6th Cir. 2005) (`Federal standards govern the application of judicial estoppel in federal court.' (quoting Warda v. C.I.R., 15 F.3d 533, 538 (6th Cir.1994))); and Allen v. Zurich Ins. Co., 667 F.2d 1162, 1167 n. 4 (4th Cir.1982) (Although this is a diversity case, we consider that federal law controls the application of judicial estoppel, since it relates to protection of the integrity of the federal judicial process.). The issue is so unclear that the United States Court of Appeals for the First Circuit has expressed relief when it has had the opportunity to pretermit the issue: There is a potential choice of law problem lurking in the interstices of this case. A federal court sitting in diversity jurisdiction is obliged to apply federal procedural law and state substantive law. . . . As judicial estoppel appears neither clearly procedural nor clearly substantive, there may be a legitimate question as to whether federal or state law . . . should supply the rule of decision. Having noted this question, we swiftly lay it to the side. Alternative Sys. Concepts, Inc. v. Synopsys, Inc., 374 F.3d at 32. Although there is no consensus among the federal appellate courts as to whether the doctrine of judicial estoppel is substantive or procedural in nature, we find the argument that judicial estoppel is procedural in nature to be the more persuasive argument. The purpose of judicial estoppel is `to protect the integrity of the judicial process' by `prohibiting parties from deliberately changing positions according to the exigencies of the moment.' New Hampshire v. Maine, 532 U.S. 742, 749-50, 121 S.Ct. 1808, 149 L.Ed.2d 968 (2001) (quoting Edwards v. Aetna Life Ins. Co., 690 F.2d 595, 598 (6th Cir.1982), and United States v. McCaskey, 9 F.3d 368, 378 (5th Cir.1993)). Simply stated, judicial estoppel prevents parties from `playing fast and loose with the courts,' New Hampshire, 532 U.S. at 750, 121 S.Ct. 1808 (quoting Scarano v. Central R.R., 203 F.2d 510, 513 (3d Cir.1953), quoting in turn Stretch v. Watson, 6 N.J.Super. 456, 469, 69 A.2d 596, 603 (1949)), and prevents the system from being manipulated by `chameleonic litigants.' Blanton v. Inco Alloys Int'l, Inc., 108 F.3d 104, 108 (6th Cir.1997). This Court has observed: `Judicial estoppel . . . strives to preserve the sanctity of the oath and protect the integrity of the judicial process. Reliance is not a factor because any inconsistent statement violates the sanctity of the oath and injures the integrity of the judicial process, whether or not some party relied on the first statement. The inconsistency itself damages public confidence in the purity . . . of judicial proceedings.' Ex parte First Alabama Bank, 883 So.2d at 1244 (quoting Rand G. Boyers, Precluding Inconsistent Statements: the Doctrine of Judicial Estoppel, 80 Nw. U.L.Rev. 1244, 1249-50 (1986)). Other courts have noted that [j]udicial estoppel is a rule of procedure under which a party is estopped from taking a position contrary to that taken in prior proceedings. Heller v. Plave, 743 F.Supp. 1553, 1571 (S.D.Fla. 1990) (emphasis added); see also Oscar Mayer Foods Corp. v. ConAgra, Inc., (No. 94-1247, Dec. 22, 1994) (Fed.Cir.1994) (not reported in F.3d) (Judicial estoppel is a procedural matter, reviewed under the law of the regional circuit in which the trial court sits. (emphasis added)). Middleton argues that judicial estoppel is substantive in nature because, he says, it affects the outcome of the litigation in that its application would extinguish his right to pursue this litigation. However, this Court has noted: `[I]t is simplistic to assume that all law is divided neatly between substance and procedure. A rule of procedure may have an impact upon the substantive result and be no less a rule of procedure on that account. . . . As said in Hanna v. Plumer, 380 U.S. 460, 471, 85 S.Ct. 1136, 1144, 14 L.Ed.2d 8, 16-17 (1965), The line between `substance' and `procedure' shifts as the legal context changes. `Each implies different variables depending upon the particular problem for which it is used.' . . . ' Schoenvogel, 895 So.2d at 250 (quoting Busik v. Levine, 63 N.J. 351, 364-65, 307 A.2d 571, 578 (1973)). Although the doctrine of judicial estoppel had an impact upon the substantive result in Middleton's case, it is no less a rule of procedure on that account. Schoenvogel, 895 So.2d at 250. The primary purpose of the doctrine of judicial estoppel is to protect the integrity of our judicial system from those who may play `fast and loose with the courts.' Consolidated Stores, Inc. v. Gargis, 686 So.2d 268, 276 (Ala.Civ.App.1996) (quoting Muellner v. Mars, Inc., 714 F.Supp. 351, 356 (N.D.Ill.1989)). Therefore, we conclude that judicial estoppel is procedural in nature, and the rule of lex fori shall apply. Thus, the trial court was correct to apply Alabama caselaw regarding the doctrine of judicial estoppel.