A Complicated, Egg-Head, Politically Incorrect Argument to Apply Mexican Law to Derivative Claims Arising from Accident In the United States
The derivative loss of consortium claims arose from an occurrence that took place in Louisiana when Florencio, Evangelio, Samuel, and Alfredo were involved in a motor vehicle accident on Interstate 49 when their 1996 Dodge 1500 pick-up truck rear-ended a 1996 International tractor-trailer driven by John.
At all pertinent times, John was an agent acting within the scope of his authority with D.T., L.L.C.
Florencio, Evangelio, Samuel, and Alfredo were in America illegally. Alfredo died as a result of the accident. Should Alfredo’s family, who had never been to the United States, benefit from the state laws of consortium?
The Louisiana Supreme Court defined the elements of damage for a wrongful death action in Hill v. Shelter Mutual Insurance Company. The Supreme Court stated, “The elements of damage for a wrongful death action are loss of love, affection, companionship, services, support, medical expenses and funeral expenses. Additionally, the courts have allowed damages in wrongful death actions for mental pain, suffering, and distress resulting from the death of the victim.”
The laws of Mexico would allow the five wrongful death beneficiaries and the thirteen personal injury beneficiaries in this case more limited recovery.
Mexican law expert, Roberto Calvo Ponton, asserts that, under Mexican law, the Plaintiffs would have a strict liability claim which allows recovery of compensatory damages up to certain amounts (“caps”) fixed in Mexican Federal Labor Law.
Pursuant to Article 1773 of the [Michoacan] Civil Code the remedy in strict liability cases, as well as other causes of action, shall consist in the re-instatement of the situation prior to such damage, and when that is impossible, it shall consist in the payment of damages. Pursuant to Article 32 of the Criminal Code of Michoacan, when the damage is caused to the individuals and produces the death or the total or partial disability, temporary of permanent, the amount of the indemnity shall be fixed applying the provisions and the tariffs established in the Federal Labor Law [of the Republic of Mexico].
Applicable provisions of the Mexican Federal Labor Laws that state the caps on damages for the derivative claims of the Plaintiffs. In addition to these “material damages”, the laws of the State of Michoacan and Mexico allow for recovery of “moral damages”.
Pursuant to Article 1774 of the Civil Code for Michoacan, the Court may grant in favor of the victim an indemnity for moral damages, which in no event it may be greater than one third of the indemnity for material damages. It must be noted that a Court may only grant a compensation for moral damages when there has been an illicit conduct, which not necessarily occurs in the strict liability cases.
The United States Court of Appeals for the Fifth Circuit discussed damages for derivative claims under Mexican law in Ramirez v. Autobuses Blancos Flecha Roja, S.A. De C.V.
The Court of Appeals stated, “The law of Mexico does not allow damages for pain and suffering or physical injury in the common tort suit but rather provides compensation for lost wages calculated through a formula based on the injured party’s former wages and the Mexican federal labor wage standards.
Damages known as ‘moral reparations’ are also available.” “Moral reparations” under Mexican law are “designed to compensate for humiliation, injury to reputation, and mental anguish”.
The substantially different recoveries allowed for derivative claims in tort under the law of Louisiana and the law of Michoacan, Mexico present a conflict-of- laws issue regarding damages. The Court must resolve this conflict according to the rules set forth in Book IV, Title VII of the Louisiana Civil Code. These rules direct the Court to apply the damages law of the State of Michoacan, Mexico to determine the Plaintiffs’ recovery for their derivative claims in tort.
The United States Fifth Circuit Court of Appeal has also used issue-by-issue choice-of-law analysis to apply, in a single case, the law of one state to the merits a wrongful death claim and the law of another state to issues concerning damages. For example, in Transco Leasing Corporation v. United States of America, the U.S. Fifth Circuit Court of Appeals held that the law of Texas, the place of the alleged negligent conduct and injury, applied to the merits of a wrongful death action instituted under the Federal Torts Claims Act in a Texas court , and the law of Louisiana, the domicile of the decedent and his beneficiaries, applied to issues of damages in the case.
The merits of the Plaintiffs’ derivative claims should be governed by the law of Louisiana. However, the Court must engage in a separate and different choice of law analysis to determine whether Louisiana or Mexican law governs the damages to be awarded to the derivative claimants in this case should they prove the merits of their claims. The applicable choice-of-law analysis pertains to issues of loss distribution and financial protection and, as is discussed extensively below, directs the Court to apply the law of damages of Mexico to the Plaintiffs’ derivative claims.
In this tort case, the Court must choose a rule of decision from two differing laws regulating damages. Laws regulating damages pertain to issues of loss distribution and financial protection. Loss distribution and financial protection rules “prohibit, assign, or limit liability after the tort occurs.”
Louisiana Civil Code Article 3544 specifies the law that should generally be applied in cases involving conflicts of loss distribution laws. Louisiana Civil Code Article 3544 states:
Issues pertaining to loss distribution and financial protection are governed, as between a person injured by an offense or quasi-offense and the person who caused the injury, by the law designated in the following order:
(1) If, at the time of the injury, the injured person and the person who caused the injury were domiciled in the same state, by the law of that state. Persons domiciled in states whose law on the particular issue is substantially identical shall be treated as if domiciled in the same state.
(2) If, at the time of the injury, the injured person and the person who caused the injury were domiciled in different states: (a) when both the injury and the conduct that caused it occurred in one of those states, by the law of that state; and (b) when the injury and the conduct that caused it occurred in different states, by the law of the state in which the injury occurred, provided that (i) the injured person was domiciled in that state, (ii) the person who caused the injury should have foreseen its occurrence in that state, and (iii) the law of that state provided for a higher standard of financial protection for the injured person than did the law of the state in which the injurious conduct occurred.
Such rules focus less on territorial factors such as the place of conduct and more on the parties’ contacts with the involved states, particularly the domicile of the parties.
Importantly, in this case, the Plaintiffs asserting derivative claims were domiciled in the Michoacan, Mexico at the time of, and since, the accident. They had never set foot in the United States. Defendant John, the alleged tortfeasor and driver of the 18-wheeler tractor-trailer that collided with the truck occupied by the Plaintiffs asserting direct personal injury claims, was domiciled in Louisiana at the time of the accident and continues to be a Louisiana domiciliary. Consequently, paragraph (2) of Article 3544 applies since the Plaintiffs asserting derivative claims and Matthew were domiciled in different states at the time of the accident.
Laws regulating damages express a state’s policies concerning the distribution of loss resulting from tortious acts and what financial protection or limits on liability should be afforded. Domicile is the primary factor in issues relating to loss distribution and financial protection.
In this case, the Plaintiffs asserting derivative claims were domiciled in Michaocan, Mexico and have no connection to Louisiana. The alleged tortfeasor, Mr. Matthew, and his employer, DT, are Louisiana domiciliaries. Thus, no legitimate interest or policy of the state of Louisiana would be served by the application of its unlimited damages rule.
Moreover, application of its law in this case would impair Louisiana’s interest in protecting Louisiana tortfeasors from unfair and burdensome damage awards. In contrast, Mexico has a interest in applying its law of damages to the derivative claims in this case because the claimants are Michaocan domiciliaries and should be afforded the protections of Mexican law. This was the holding of the United States Fifth Circuit Court of Appeal in Vasquez v. Bridgestone/Firestone, Inc.
Louisiana has no legitimate interest in applying its law on damages so as to provide the plaintiffs with a higher recovery than that allowed by the law of the plaintiffs’ domicile.
In Transco Leasing Corporation, the U.S. Fifth Circuit Court of Appeals held that the law of the plaintiff’s domicile, rather than the law of the state of conduct and injury, applied to determine the proper amount of nonpecuniary damages awarded to the plaintiff in a wrongful death action.
In Transco Leasing, the plaintiff was a Louisiana citizen who filed a Federal Torts Claim Act wrongful death suit in a Texas federal court for the death of her husband and daughter (both Louisiana citizens) in a collision of two private planes over Texas. The district court held that Louisiana law should be applied to the issue of damages suffered by the plaintiff. The plaintiff urged the Court of Appeals to reevaluate the amount of the damages awarded to her under Louisiana law in light of the higher nonpecuniary damage awards affirmed under Texas law for similar losses. The Court of Appeals rejected the plaintiff’s argument that Texas law should govern the issue of damages since Louisiana’s interest in ensuring the adequate compensation for its citizens would be satisfied if the higher standard of protection afforded by Texas law were applied. The Court of Appeals stated, “Texas, however, has no interest in the amount of wrongful death damages awarded to Louisiana residents.”
Article 1773 of the Michoacan Civil Code which provides the remedy available to tort victims expresses this same policy. It says that such remedy “shall consist in the re-instatement of the situation prior to such damage, and when that is impossible, it shall consist in the payment of damages.”
While the recoveries allowed under the damages law of Louisiana and Michoacan, Mexico are different, the policies on which they are based are the same. Therefore, Louisiana’s policies are not impaired by the application of Michoacan’s law on damages.
A state’s law on damages is designed to protect its citizens. That is, the purpose of a state’s law on damages is twofold:
First, through its law regulating damages, a state seeks to ensure that its citizens who are injured by the tort of another are adequately compensated and do not become public charges.
Second, a state’s law on damages seek to ensure that its citizens who commit torts are protected either from liability altogether (e.g. workers’ compensation immunity for employers) or from excessive or burdensome damage awards.
Like this case, the issue in Vasquez was whether the law of Mexico or Texas should govern damages in a suit filed in Texas state court by Mexican plaintiffs against American citizens for the wrongful death of Mexican citizens. The decedents died in an automobile accident in Mexico. In Vasquez, the U.S. Fifth Circuit Court of Appeal held that Mexican law, not Texas law, should govern issues of damages. The court stated, “We are mindful of the disparate levels of wrongful death damages provided under Texas and Mexican law and the incentive for plaintiffs to sue in the United States. Given that all decedents and plaintiffs are Mexican, however, there is little justification for applying Texas law, which seeks to protect the rights of its citizens to adequate compensation.”
In this present case, the plaintiffs asserting direct personal injury claims were present in the U.S. illegally at the time of the motor vehicle collision from which their claims, and those of the plaintiffs asserting derivative claims, arise. Also, the direct claimants were unauthorized to work in the U.S. Thus, the direct claimants were directly contravening explicit congressional policies and committing criminal fraud at the time of the accident. The United States has a direct interest in not contravening its own immigration policies. Applying Louisiana law in this case, rather than the required Mexican law and awarding damages based at least in part on illegal workers’ future wages in the United States which could only be obtained by criminal fraud, would not only “trivialize federal immigration laws.”
Michaocan, Mexico has an interest in applying its law on damages to the derivative claims in this case because the claimants are domiciled in Michaocan, Mexico. Mexico has both a right and a duty to be concerned about the welfare of its citizens.
It has an interest in ensuring adequate recovery for the plaintiffs because it has the duty to bear the burden of their care if their recovery is inadequate and they become public charges. The U.S. Fifth Circuit Court of Appeals used this reasoning as a basis for its decision in Guillory v. United States.
In Guillory, a Federal Torts Claim Act wrongful death suit, the Court of Appeals held that the death of the plaintiff’s husband was caused by the negligence of the Veterans’ Administration personnel in giving prescriptions to the plaintiff in Texas and sending the decedent and his family from Texas back to their home state of Louisiana without the necessary knowledge to safely administer the prescribed drugs to the decedent.
The derivative claims at issue, as well as the claims of the plaintiffs asserting direct personal injury claims, arise from the collision in Louisiana. Thus, Louisiana is the place of conduct and the place of injury to Alfredo, who died in the accident and the plaintiffs asserting direct personal injury claims.
In Allstate Insurance Co. v. Hague, a wrongful death case concerning a conflict of loss distribution rules, the United States Supreme Court affirmed the application of the law of the plaintiff’s domicile even though the decedent’s death, and the conduct that caused it , occurred in another state.
The Supreme Court stated, “While the place of the accident is a factor to be considered in choice-of-law analysis, to apply blindly the traditional, but now largely abandoned doctrine, would fail to distinguish between the relative importance of various legal issues involved in a lawsuit as well as the relationship of other jurisdictions to the parties and to the occurrence or transaction.”
In cases concerning conflicts of loss distribution laws, the “primary connecting factor” is the domicile of the parties, particularly the domicile of the injured party or parties.
As stated above, the domicile of the injured parties is given more weight than the other connecting factors because domicile “connotes a permanent, factual, consensual, and formal bond between a person and a given society. Because of this bond, the person participates, however indirectly, in the shaping of that society’s values and may reasonably expect the protection of its laws. Correspondingly, that society has both a right and a duty to be concerned about that person’s welfare.”
Comment (c) to Article 3515 states, “[T]he parties should not be subjected to the law of a state that they had no reason to anticipate would be applied to their case.”
It is not unfair to apply Mexico’s law on damages to the plaintiffs’ claims merely because the recovery allowed under Mexican law is less than the recovery allowed under Louisiana law. Thus, the domicile of the injured parties carries greater weight in the conflict of laws process of analysis then the place of conduct and the place in which the relationship between the parties was centered.
In this case, the plaintiffs asserting derivative claims are domiciliaries of Michaocan, Mexico and have never stepped foot in the United States. Therefore, these plaintiffs may reasonably expect the protection of Mexico’s law on damages, not Louisiana law. Michaocan, Mexico, not Louisiana, has a right and duty to be concerned for their welfare.
It is hardly unfair to subject the Mexican plaintiffs to Mexico’s law on damages. They should have reasonably anticipated that the law of Mexico would apply since all of them are Mexican domiciliaries and the plaintiffs asserting derivative claims have never stepped foot into the United States.
Moreover, the plaintiffs should have reasonably anticipated the application of Mexican law on damages because it is Mexico that will bear the burden if they do not receive adequate compensation.
Most importantly, the plaintiffs should have reasonably anticipated the application of Mexican law because the direct claimants were in the U.S. illegally and were not authorized to work in the U.S. at the time of the accident on which the claims of all plaintiffs are based.a strict liability theory, and although their potential damages may be smaller, there is no danger that they will be deprived of any remedy or treated unfairly.”
Respecting the Sovereignty of the Mexico and the United States
Mexico’s law of damages represents the policy choices of its elected lawmakers made for the benefit of the citizens of Mexico. Thus, Mexico’s law of damages should be applied to the Mexican plaintiffs on the basis of “basic principles of comity.”
Mexico as a sovereign nation, has made a deliberate policy choice in providing a specific remedy for this tort cause of action. In making this policy choice, the Mexican government has resolved a trade-off among the competing objectives and costs of tort law, involving interests of victims, of consumers, of manufacturers, and of various exican government with our own view of what is a good policy for the citizens of Mexico.
The damages law of Michaocan, Mexico applies to the plaintiffs’ derivative claims in this case because the policies of Mexico would be most seriously impaired if its law were not applied to the issue of damages. The policies contained in Mexico’s laws of damages should apply to the claims of the plaintiffs asserting derivative claims because they are Mexican citizens. Mexico has a duty to care for its citizens. Furthermore, Mexico has an interest in the plaintiffs receiving adequate compensation under Mexican law because it will bear the consequences if the plaintiffs are not adequately compensated.
In contrast, Louisiana has no interest in applying its law of damages to the Mexican plaintiffs. Moreover, application of Louisiana law of damages to the derivative claims in this case is unfair and directly contravenes the polies of the United States as stated in its immigration and labor laws because all of the the plaintiffs in this case are citizens of Mexico and all of their claims are arise from a motor vehicle accident that would not have occurred but for the direct claimants’ illegal presence in the United States.
Mexico has the more substantive relationship to the parties and the dispute in this case because it is the domicile of the plaintiffs. In cases like this one, involving a conflict of loss distribution rules, domicile is the primary connecting factor.
Mexico’s law of damages should be applied to the derivative claims in this case because the plaintiffs should have reasonably expected that the law of their domicile would be applied to their claims. Also, because Mexico’s sovereignty would be disrespected if it were denied the right to advance its policies as reflected in its laws of damages to its own citizens.
Lastly, Mexico’s law of damages should be applied to the derivative claims in this case because the applicationunfair, disrespect the sovereignty of the United States, and encourage forum shopping. It is unfair to apply Louisiana’s law on damages to allow the plaintiffs greater recovery because the plaintiffs asserting derivative claims are Mexican citizens who have never even stepped foot into the United States.