Opinion ID: 3135381
Heading Depth: 2
Heading Rank: 3

Heading: Ill 2d at 384-416, reasoned as follows:

Text: “We recognize that plaintiffs, as Michigan residents, are not subject to Illinois’s constitutional protections and, therefore, Illinois would have little or no interest in protecting plaintiffs -20- from caps on noneconomic damages. Nevertheless, we must also consider that Illinois, as the forum state where the case will be tried, has a very strong interest in its constitutional protection of separation of powers within its borders and, therefore, has a strong interest in protecting against another state’s legislative encroachment on the inherent power of its judiciary to determine whether a jury verdict is excessive. Thus, Illinois has a compelling public policy interest in applying Illinois law with respect to caps on noneconomic damages.” 368 Ill. App. 3d at 912. We cannot accept this reasoning. We agree with Sears that enforcement by an Illinois court of the Michigan cap on noneconomic damages does not constitute an encroachment of separation of powers in Illinois. Rather, such enforcement simply applies a Michigan statute against a Michigan resident that has been upheld as constitutional in Michigan. 3. Punitive Damages The last conflict is between the availability of punitive damages in product liability cases when appropriate, in Illinois, and the general unavailability of punitive damages in Michigan. The appellate court observed that the purposes of punitive damages are to punish the defendant and deter future wrongdoing. Based on this unremarkable premise (see Kelsay, 74 Ill. 2d at 186), the appellate court again posited that punitive damages reflect “a corporate regulatory policy,” while the disallowance of punitive damages “reflects a corporate protection policy.” 368 Ill. App. 3d at 911, The appellate court then determined that “Illinois, where the alleged design defects and corporate knowledge of previous accidents occurred, has a definite interest in punishment, deterrence of future wrongdoing, and corporate accountability.” 368 Ill. App. 3d at 911, citing Restatement (Second) of Conflict of Laws §146, Comments c, e, at 430, 432 (1971). The appellate court concluded: “Michigan, the place of plaintiffs’ residence and the place of injury, has an interest in assuring that plaintiffs are compensated for their injuries. Nevertheless, where the purpose of disallowing punitive damages is not related to -21- redressing the plaintiffs’ injury, once the plaintiffs are made whole by recovery of the compensatory damages to which they are entitled, the interests of Michigan law are satisfied. [Citation.] Accordingly, Illinois, as Sears’ principal place of business and the place where the alleged corporate misconduct occurred, has the most significant relationship to the issue of punitive damages.” 368 Ill. App. 3d at 911. We disagree. Again, the purpose of the section 145 analysis is to test our strong presumption that the law of Michigan, where plaintiffs reside and the place of injury, should govern the substantive issues in this case. Restatement (Second) of Conflict of Laws §146, Comment e, at 432 (1971). The appellate court characterization that Michigan “has an interest” in this conflict is an understatement that fails to recognize the strong presumption in favor of applying Michigan law. Also, although the appellate court cited to comments c and e of section 146, the court misapprehended their full meaning. Certainly, comment c instructs: “The extent of the interest of each of the potentially interested states should be determined on the basis, among other things, of the purpose sought to be achieved by their relevant local law rules and of the particular issue.” Restatement (Second) of Conflict of Laws §146, Comment c, at 430 (1971). However, the comment continues on the same page to advise: “The likelihood that some state other than that where the injury occurred is the state of most significant relationship is greater in those relatively rare situations where, with respect to the particular issue, the state of injury bears little relation to the occurrence and the parties.”(Emphasis added.) Restatement (Second) of Conflict of Laws §146, Comment c, at 430-31 (1971). Likewise, the passage in comment e, to which the appellate court cited, actually states in full: “[A]n important factor in determining which is the state of most significant relationship is the purpose sought to be achieved by the rule of tort law involved. If this purpose is to punish the tortfeasor and thus to deter others from following his example, there is better reason to say that the state where the conduct occurred is the state of dominant interest and that -22- its local law should control than if the tort rule is designed primarily to compensate the victim for his injuries  . In the latter situation, the state where the injury occurred would seem to have a greater interest than the state of conduct. This factor must not be over-emphasized. To some extent, at least, every tort rule is designed both to deter other wrongdoers and to compensate the injured person. Undoubtedly, the relative weight of these two objectives varies somewhat from rule to rule, but in the case of a given rule it will frequently be difficult to determine which of these objectives is the more important.” (Emphases added.) Restatement (Second) of Conflict of Laws §146, Comment e, at 432-33 (1971). Despite this explicit caution, the appellate court not only undervalued the strong presumption in favor of Michigan law, but overemphasized its perception of the interests Illinois and Michigan have in their different concepts of tort damages. Illinois certainly has a legitimate interest in the liability to be imposed on Illinois-based defendants under strict liability or negligence principles. However, Michigan has an equally legitimate interest in the remedies to be afforded its residents who suffer such tort injuries. And if the substantive law of these two states looks in different directions, each state would seem to have an equal interest in having its tort rule applied in the determination of the conflicting issues presented in this case. See Hardly Able Coal Co. v. International Harvester Co., 494 F. Supp. 249, 251 (N.D. Ill. 1980) (applying Illinois law, concluding that law of Kentucky, where injury occurred, governs). We conclude that a section 145 analysis does not override our strong presumption that the law of Michigan, as the state where plaintiffs reside and where the injury occurred, governs the conflicting issues presented in this case. In sum, a court begins a choice-of-law analysis in a tort case by ascertaining whether a specific presumptive rule, such as section 146 in a personal injury action, applies to the disputed conflict. Next, if the presumptive rule points to a specific jurisdiction, then the court must test this presumptive choice against the principles embodied in section 6 in light of the relevant contacts identified by the general tort principle in section 145. The presumptive choice controls unless overridden by the section 145 analysis. -23-