Bits & Pieces

Johnston v. Sappi Fine Paper North America

United States District Court,E.D. Michigan,Southern Division.

John JOHNSTON and Dawn Johnston, Plaintiffs,


SAPPI FINE PAPER NORTH AMERICA, a Pennsylvania Corporation, S.D. Warren Company, a Pennsylvania Corporation, d/b/a Sappi Fine Paper North America, Defendant.


March 29, 2007.





LAWRENCE P. ZATKOFF, United States District Judge.




This matter is before the Court on Defendant’s motion for summary judgment [dkt 11]. Plaintiff has responded, and Defendant has replied to the response. The Court finds that the facts and legal arguments are adequately presented in the parties’ papers and the decision process would not be significantly aided by oral argument. Therefore, pursuant to E.D. Mich. LR 7.1(e)(2), it is hereby ORDERED that the motions be resolved on the briefs submitted. For the reasons set forth below, Defendant’s motion is DENIED.





Plaintiff is a 58-year old resident of Adrian, Michigan, who drives trucks on a part-time basis for L & M Trucking. Plaintiff has no formal training as a truck driver. Defendant is a paper manufacturer, with paper mills located in Maine, Michigan, and Minnesota.


On August 10, 2005, Plaintiff drove his truck to Defendant’s paper mill located in Muskegon, Michigan, to pick up a load of cylindrical paper rolls weighing approximately 41,000 pounds. Pursuant to Defendant’s policy, Plaintiff went to the driver’s lounge while his trailer was being loaded. Plaintiff’s trailer was loaded by Dexter Clanton. Clanton does not remember loading Plaintiff’s particular trailer, but testified that he always uses friction matting to secure rolls of paper in a trailer.


After Clanton had finished the loading, Plaintiff was given an opportunity to inspect the trailer. Plaintiff looked in the trailer to determine if the correct number of rolls had been loaded, and to make sure his load bar was still inside. Plaintiff did not enter the trailer, and did not attempt to determine if the rolls had been properly loaded. Johnston Dep. at 39.


After leaving the mill, Plaintiff prepared to merge onto I-94 from I-127 in Blackman Township, Michigan, via a C-shaped ramp. Plaintiff testified that he was driving at a normal speed. A third-party witness also testified that Plaintiff was not driving at an excessive speed. Paxson Dep. at 9. As he navigated the ramp, Plaintiff felt the truck shake, and it began to tip. At the top of the ramp the truck rolled over on the driver’s side. Plaintiff suffered fractures and tendon separation, and his treatment required the insertion of pins and screws in his arm.


Michigan State Trooper Mark Brown responded to the accident. Brown’s report did not indicate that there was friction matting in the trailer. Brown testified that if there had been friction matting, he would have noted it in the report. Brown Dep. at 30. Daniel Lee, a professor at Michigan State University with experience in accident reconstruction and truck rollovers, inspected the truck approximately two weeks after the accident. Lee did not find friction matting in the truck. Lee Dep. at 28. Lee testified that the rollover was most likely due to load shift.


Plaintiff filed suit in this Court on April 4, 2006, on the basis of diversity jurisdiction.





Summary judgment is proper where “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). Them moving party bears the initial burden of demonstrating the absence of any genuine issue of material fact, and all inferences should be made in favor of the non-moving party. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986).


To support its motion, the moving party may show “that there is an absence of evidence to support the nonmoving party’s case.” Id. at 325. While all inferences must be drawn in favor of the nonmoving party, this Court is under no obligation to imagine favorable facts where the nonmoving party has alleged none. “[T]he mere existence of a scintilla of evidence in support of the plaintiff’s position will be insufficient [to defeat a motion for summary judgment]; there must be evidence on which the jury could reasonably find for the plaintiff.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).





A. Applicable Rule



Plaintiff and Defendant disagree as to which rule should govern Defendant’s duty to Plaintiff in this case. Because jurisdiction is based on diversity, Michigan law applies. Westfield Ins. Co. v. Tech Dry Inc., 336 F.3d 503, 506 (6th Cir.2003).


Plaintiff argues that standard negligence law should apply to this situation. Thus, Defendant had a duty to use reasonable care in the loading of Plaintiff’s truck.


Defendant argues that the rule established by the Fourth Circuit in United States v. Savage Truck Line, Inc. should apply. The Savage rule states that:

The primary duty as to the safe loading of property is therefore upon the carrier. When the shipper assumes the responsibility of loading, the general rule is that he becomes liable for the defects which are latent and concealed and cannot be discerned by ordinary observation by the agents of the carrier; but if the improper loading is apparent, the carrier will be liable notwithstanding the negligence of the shipper.


United States v. Savage Truck Line, Inc., 209 F.2d 442, 445 (4th Cir.1953). In 2000, the Supreme Judicial Court of Maine reaffirmed the Savage rule, noting that the policy behind it is “well founded.” Decker v. New England Public Warehouse, Inc., 749 A.2d 762, 766 (Me.2000). The Decker court also noted that the Savage rule has been adopted by the majority of modern courts. Id. at 767. See also Smart v. Am. Welding & Tank Co., 149 N.H. 536, 826 A.2d 570 (N.H.2003); Brashear v. Liebert Corp., 2007 Ohio 296 (Ohio Ct.App.2007); W.J. Casey Trucking & Rigging Co. v. General Electric Co., 151 N.J.Super. 151, 376 A.2d 603, (N.J.Super. Ct. Law Div.1977). Pursuant to the Savage rule, even if Defendant was negligent in the loading of Plaintiff’s truck, Defendant would not be liable if the improper loading was apparent.


There are no decisions from Michigan courts regarding the Savage rule. In the absence of controlling state law:

A federal district court sitting in diversity of citizenship jurisdiction may consider all of the available legal sources. This principle embraces … judicial decisions from other jurisdictions whose doctrinal approach to legal matters is substantially the same as that of the forum state, [and] the majority rule on the point in issue as reflected in a canvas of the prevailing law on the point throughout the county ….


Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction 2d §  4507, 191-99 (1996). As noted above, a majority of modern courts have accepted the Savage rule, and Plaintiff has not produced any opinions rejecting it. The Sixth Circuit has also quoted Savage favorably. Pierce v. Cub Cadet Corp., No. 87-5936, 875 F.2d 866, (6th Cir.1989). Furthermore, the Sixth Circuit has held that carriers, not shippers, are liable for injuries sustained during the unloading of cargo, unless the shipper had exclusive control over the loading of the cargo. Rector v. General Motors Corp., 963 F.2d 144, 147 (6th Cir.1992). The Sixth Circuit noted that “federal regulations state that ‘the driver of a truck or truck tractor must … assure himself that’ his vehicle’s cargo is properly distributed and adequately secured.” Id. (quoting 49 C.F.R. §  392.9(b)). The Sixth Circuit held that “[w]hile not dispositive, this regulation is indicative of the proper allocation of duty as between a common carrier and a shipper for the proper loading of goods.” Id. Thus, the ultimate responsibility for ensuring that a load is safely loaded generally lies with the carrier.


Likewise, in its recent affirmation of the Savage rule, the Ohio Court of Appeals relied in part on federal regulations for support of the proposition that the carrier bears the duty to ensure that cargo has been properly loaded.  Brashear, 2007 Ohio 296 at *8. The Brashear court held that “the shipper is liable for defects that are latent and concealed and cannot be discerned by ordinary observation by the agents of the carrier; if the improper loading is apparent, however, the carrier will be liable notwithstanding that the shipper was negligent.” Id. at *8-*9.


Michigan has adopted as state law the federal regulation cited by the Sixth Circuit in Rector. See M.C.L. §  480.11a. As noted by the Sixth Circuit, this regulation is not dispositive, but tends to indicate that the responsibility for safe loading lies with the carrier. Furthermore, as noted above, the Savage rule is the majority rule. Thus, the Court will analyze this case using the Savage rule.



A. Issues of Material Fact


Defendant concedes that there are genuine issues of material fact regarding whether friction matting was used, and whether the absence of friction matting caused the accident. However, Defendant argues that the alleged lack of friction matting was not a latent defect, and Plaintiff did not inspect the load. Pursuant to the Savage rule, shippers are liable for negligent loading only if the “negligence was undiscoverable through a reasonable safety inspection.” Decker, 749 A.2d at 767. However, the Savage rule “does not demand abnormal scrutiny from carriers. It matters little if an extensive carrier inspection would have uncovered the shipper’s negligent loading if a reasonable inspection by the carrier did not disclose the problem.” Id. Defendant notes that Plaintiff remained on the ground while inspecting the trailer, and did not climb into it.


In response, Plaintiff argues that the friction matting was narrower than the paper rolls, and would have been completely covered by the rolls. Thus, the lack of friction matting would not have been apparent to Plaintiff even had he climbed into the trailer to inspect the load.


Defendant has not provided any evidence that a reasonable inspection would have detected a lack of friction matting, other than its conclusory assertions. Viewing the evidence in the light most favorable to Plaintiff, the Court finds that there is a genuine issue of material fact regarding whether a lack of friction matting would have been detectable through a reasonable inspection. Thus, Defendant’s motion for summary judgment is denied.





For the above reasons, Defendant’s motion for summary judgment is DENIED.



Great West Casualty v. State of La

Court of Appeal of Louisiana,First Circuit.

GREAT WEST CASUALTY CO., Kokesch Trucking, Inc., and Stan Koch & Sons, Inc.



Ralph Geier


State of Louisiana through the Development of Transportation and Development.


March 28, 2007.




On March 31, 1991, Ralph Geier, a resident of Minnesota, was injured when the semi-tractor trailer truck he was operating on I-12 in Slidell, Louisiana, overturned as he attempted to exit onto the I-59 exit ramp. At the time of the accident, Mr. Geier was operating a truck owned by his employer, Kokesch Trucking, Inc. (“Kokesch”) and/or Stan Koch & Sons, Inc. (“Stan Koch”), and insured by Great West Casualty Company (“Great West”). As a result of the injuries sustained by Mr. Geier in the accident, Great West paid damages to Mr. Geier on behalf of Kokesch and Stan Koch. Great West, Kokesch, and Stan Koch subsequently filed suit against the State of Louisiana through the Department of Transportation and Development (“DOTD”) seeking reimbursement for the damages paid to Mr. Geier.


In a separate action, Mr. Geier filed suit against DOTD, alleging negligence and strict liability and seeking damages for past, present, and future mental and physical pain and suffering, past and future medicals, past and future lost wages, and permanent impairment of physical function and disability. Thereafter, the suits were consolidated, and a bench trial was conducted on June 28-29, 2005. After hearing the evidence, the trial court took the matter under advisement and, on September 28, 2005, issued reasons for judgment finding in favor of Mr. Geier. The trial court found that DOTD was fully responsible for the accident and awarded damages as follows: past medical expenses in the amount of $77,298.60; past lost wages in the amount of $222,282.72; and past pain and suffering in the amount of $300,000.00. The court also found in favor of Great West in the amount of $33,423.50 and in favor of Kokesch and Stan Koch in the amount of $47,792.60. Judgments in accordance with the court’s findings were signed on January 17, 2006, and January 18, 2006, respectively.


DOTD has appealed, assigning the following specifications of error:

1. The trial court erred in allowing plaintiff’s recovery of damages subrogated to The Minnesota Department of Labor and Industry; the collateral source rule of damages has no application given the existence of a subrogation clause;

2. The trial court erred in apportioning fault to the DOTD and none to Plaintiff.


For the reasons that follow, we affirm.





On appeal, DOTD argues that the trial court erred as a matter of law in its application of the collateral source rule in the face of a subrogation clause and in awarding damages to Mr. Geier that belonged to the subrogee, the Minnesota Department of Labor and Industry (“MDOL”). DOTD alleges that this award not only unjustly enriches Mr. Geier but also inures to the benefit of the wrongdoer, Kokesch, who should have paid the sums.


In response, Mr. Geier contends that the State of Minnesota chose to confer a gratuitous benefit upon him by paying his medical bills, lost wages, and disability benefits from the MDOL’s Special Compensation Fund. Moreover, Mr. Geier asserts that in a letter dated April 25, 2002, MDOL evidenced its intent to waive any right to subrogation, stating “This letter is confirming that the [MDOL’s] Special Compensation Fund, which has paid worker’s compensation benefits to [Mr.] Geier related to this injury, will not be seeking reimbursement for benefits it has paid.” Thus, Mr. Geier maintains, the collateral source rule is applicable in this case, and the trial court’s judgment should be affirmed. We agree.


The collateral source rule is of common law origin yet it is well-established in the jurisprudence of this state. Louisiana Dep’t of Transp. and Dev. v. Kansas City Southern Ry. Co., 2002-2349, p. 6 (La.5/20/03), 846 So.2d 734, 739. Under the collateral source rule, a tortfeasor may not benefit, and an injured plaintiff’s tort recovery may not be diminished, because of benefits received by the plaintiff from sources independent of the tortfeasor’s procuration or contribution. Sutton v. Lambert, 94-2301, p. 14 (La.App. 1 Cir. 6/23/95), 657 So.2d 697, 706, writ denied, 95-1859 (La.11/3/95), 661 So.2d 1384.


According to Restatement (Second) of Torts §  920A (1979):

(1) A payment made by a tortfeasor or by a person acting for him to a person whom he has injured is credited against his tort liability, as are payments made by another who is, or believes he is, subject to the same tort liability.

(2) Payments made to or benefits conferred on the injured party from other sources are not credited against the tortfeasor’s liability, although they cover all or a part of the harm for which the tortfeasor is liable.



Thus, a benefit that is directed to the injured party should not be shifted so as to become a windfall for the tortfeasor, and if the plaintiff was himself responsible for the benefit, as by maintaining his own insurance or by making advantageous employment arrangements, the law allows him to keep it for himself. See Restatement (Second) of Torts §  920A comment b.


Subrogation is an exception to the collateral source rule. See Sutton, 94-2301 at 15, 657 So.2d at 706-707. Thus, the collateral source rule is inapplicable where the right of subrogation is involved, even if the party subrogated does not appear to assert its subrogation rights and the defendants do not timely object to the nonjoinder of the necessary party. Id. Where subrogation is proven, the plaintiff may recover only his remaining interest in the partially subrogated claim. Southern Farm Bureau Cas. Ins. Co. v. Sonnier, 406 So.2d 178, 180 (La.1981); see also La.Code Civ. Proc. art. 697. Moreover, a subrogation can be assigned to the insured, who then has a right of action to enforce it. Sutton, 94-2301 at 16, 657 So.2d at 707.


After hearing from the witnesses and considering the documentary evidence in the record, the trial court made the following findings concerning the application of the collateral source rule:

Damages. Mr. Geier did not have personal health insurance nor did he have coverage provided by his employer. As a resident of Minnesota, he [benefited] from the Minnesota Dept. Of Labor and Industry’s Special Compensation Fund which paid his medical expenses, lost wages and a lump sum for partial permanent disability. The Minnesota Department of Labor and Industry by letter dated April 25, 2003 declined to seek reimbursement for the benefits it paid to Mr. Geier.

The Supreme Court in La. DOTD v. Kansas City Southern Railway Co., 846 So.2d 734 (La.2003) and Bozeman v. State, 879 So.2d 692 (La.2004) discussed the Louisiana collateral source rule at length. Both cases deal with the ability of plaintiffs to receive amounts “written off” in the case of Medicaid payments (Bozeman ) or Federal reimbursement for environmental cleanup (La.DOTD ). The Court clearly describes the history of the collateral source rule and its goal that the tortfeasor not benefit as a result of payment by another source. In Bozeman, the court put limits on the amount which can be claimed under the rule but allowed collection of the full amount (including “write offs”) where the plaintiff was forced to reduce his patrimony in order to obtain the collateral source benefit. In the present case, Minnesota declined to seek reimbursement for amounts paid to Mr. Geier after initially reserving its rights to subrogation in a settlement dated October 2, 1991. Minnesota paid all Mr. Geier’s medical and lost wage expenses and Mr. Geier’s income tax returns reflect only that income and income from his part-time trucking work. Clearly, from the evidence presented and the Court’s observance of Mr. Geier during his testimony, the collateral source rule is applicable in light of the Bozeman ruling.



Following a thorough review of the record and applicable law, we find no error in the trial court’s findings in this regard. The MDOL Special Compensation Fund clearly had a statutory right of subrogation as set forth in Minn.Stat. Ann. §  176.061. However, as correctly noted by Mr. Geier in brief to this court, the MDOL Special Compensation Fund opted to waive this right as evidenced by its letter to Mr. Geier’s counsel on April 25, 2002. Accordingly, as the right of subrogation was waived herein, the trial court was correct in its application of the collateral source rule. This assignment of error is without merit.





In its second assignment of error, DOTD argues the trial court was clearly wrong in assessing 100 percent of the fault against it. DOTD contends that Mr. Geier had a duty to exercise due diligence and keep a sharp and attentive lookout. Mr. Geier counters, noting that the evidence of DOTD’s fault is overwhelming and that based on the manifest error standard of review, the trial court’s findings should not be disturbed.


It is well settled that the allocation of fault is a factual matter within the sound discretion of the trier of fact and will not be disturbed on appeal in the absence of manifest error. Birdsall v. Regional Electric & Construction, Inc., 97-0712, p. 4 (La.App. 1 Cir. 4/8/98), 710 So.2d 1164, 1168. If an appellate court finds a clearly wrong apportionment of fault, it should adjust the award, but then only to the extent of lowering or raising it to the highest or lowest point respectively that is reasonably within the trial court’s discretion. Clement v. Frey, 95-1119, 95-1163, pp. 7-8 (La.1/16/96), 666 So.2d 607, 611. However, when there is evidence before the trial court that, upon its reasonable evaluation of credibility, furnishes a reasonable factual basis for the trial court’s finding, the appellate court should not disturb this finding absent manifest error. Adams v. Parish of East Baton Rouge, 2000-0424, p. 23 (La.App. 1 Cir. 11/14/01), 804 So.2d 679, 698, writ denied, 2002-0448 (La.4/19/02), 813 So.2d 1090. The manifest error standard demands great deference to the trier of fact’s findings; for only the fact finder can be aware of the variations in demeanor and tone of voice that bear so heavily on the listener’s understanding and belief in what is said.  Rosell v. ESCO, 549 So.2d 840, 844 (La.1989). Thus, where two permissible views of the evidence exist, the fact finder’s choice between them cannot be manifestly erroneous or clearly wrong. Id.


After hearing the testimony of the witnesses and considering the applicable law, the court offered the following reasons for judgment concerning the allocation of fault:

This case rests largely on the credibility of one of the plaintiffs, Ralph Geier, and his account of the accident. The fact that this was an incredibly dangerous ramp from I-12 to I-59 cannot be seriously questioned. It failed to comply with the guidelines of AASHO and was notoriously dangerous to the knowledge of DOTD. The cloverleaf-style ramp had a compound curve with a much too sharp radius, made even more dangerous by a shoulder on which a rollover was almost a certainty once a truck drove onto its surface. Making the condition even more dangerous, the ramp had inadequate signage, and DOTD knew of the danger the posed to truckers. Though there was a slightly larger-than-usual ramp advisory speed sign for 25 mph, but that was it! There was no tipping-truck warning, no Warning Curve sign, no chevrons, and no special painting. The proper signage was most important to truckers who, like Mr. Geier, were unfamiliar with the ramp and the danger it posed.

The Court finds the testimony of Mr. Geier was extremely credible and worthy of belief. Mr. Geier acted properly, braking to or very near the advisory speed. When confronted with the sharpness of the compound curve, he traveled onto the paved shoulder and at that point the rollover became inevitable.

This accident was easily and very feasibly preventable by the mere placement of adequate signage and provision of an adequate and safe shoulder. DOTD did not choose these actions, though they could have done so for next-to-nothing in the case of signage and for relatively little as to the shoulder. Instead, it took the personal tragedy suffered by Mr. Geier in order for DOTD to do what should have been done earlier. The Court finds DOTD to be fully responsible for this accident and the injuries suffered by the plaintiffs.



Having thoroughly reviewed the testimony concerning the accident, and mindful of the great deference we must afford the trier of fact, we cannot say the trial court’s assessment of fault was in error. Considering the record in its entirety, we are satisfied that it reasonably supports the court’s conclusion that DOTD was 100 percent at fault in causing this accident.





For the above and foregoing reasons, we affirm the judgment of the trial court and assess appeal costs in the amount of $2,184.72 against DOTD. We issue this memorandum opinion in accordance with Uniform Rules-Courts of Appeal, Rule 2-16.1B.





Kokesch and Stan Koch subsequently filed a motion for new trial seeking an increase in damages and separate damage awards so that their damage awards would be $78,557.00 and $42,909.60, respectively. DOTD also filed a motion for new trial solely on the issue of the admissibility of the deposition of a representative from the Minnesota Department of Labor and Industry. On May 3 and May 8, 2006, respectively, the trial court signed judgments granting, in part, DOTD’s motion for new trial (solely for the purpose of reopening the record and admitting the deposition of Bruce Larson into evidence) and granting, in part, Kokesch and Stan Koch’s motion for new trial. The May 8, 2006 judgment awarded Kokesch $5,702.00 in damages and awarded Stan Koch $42,090.60 in damages.


We note the appeal motions filed by DOTD refer only to the judgments of May 3 and May 8, 2006. The denial of a motion for new trial is not an appealable judgment, absent a showing of irreparable injury. However, the Louisiana Supreme Court has directed us to consider an appeal of the denial of a motion for new trial as an appeal of the judgment on the merits, when it is clear from the appellant’s brief that the intent was to appeal the merits of the case. Smith v. Hartford Acc. & Indem. Co., 254 La. 341, 347-49, 223 So.2d 826, 828-29 (La.1969); Day v. Day, 2002-0431, p. 4 n. 4 (La.App. 1 Cir. 5/28/03), 858 So.2d 483, 486 n. 4, writ denied, 2003-1845 (La.11/7/03), 857 So.2d 492. In the instant case, it is clear from the record and from DOTD’s brief that DOTD intended to appeal the substantive issues decided by the trial court. Therefore, we will treat this as an appeal of the January 17 and 18, 2006 judgments on the merits.


Mr. Geier answered the appeal, arguing that the trial court erred in admitting the deposition of Bruce Larson into evidence as it was in violation of the collateral source rule of evidence. Generally, the trial court is granted broad discretion on its evidentiary rulings and its determinations will not be disturbed on appeal absent a clear abuse of that discretion. Smith v. Smith, 2004-2168, p. 14 (La.App. 1 Cir. 9/28/05), 923 So.2d 732, 742. Except as otherwise provided by law, all relevant evidence is admissible. La.Code Evid. art. 402. Based on our review of the record herein, we find no abuse of the trial court’s discretion in admitting Mr. Larson’s deposition into evidence and, thus, find no merit to Mr. Geier’s argument to the contrary. Mr. Geier also raised issues in his answer concerning (1) the trial court’s failure to award damages for future medical expenses; (2) the trial court’s failure to award adequate general damages; and (3) the frivolous nature of DOTD’s appeal. However, in brief to this court, Mr. Geier indicated that “upon further reflection,” he had decided not to pursue these issues on appeal. Thus, we need not address these assignments of error.

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