but rather upon the remedy and is therefore procedural in nature; and that in such case the statute of limitations of the forum should be applied, which in Pennsylvania in matters affecting damage to property is 6 years. 12 P.S.Pa. § 31.
Defendant's argument is that the action involved in this suit is a derivative action for personal injuries and therefore subject to the Pennsylvania statute relating to actions for personal injuries, 2 years, 12 P.S.Pa. § 34. Moreover, it argues that even under California law it is not an action for property damage and that even if it is, it is barred by the California statute of limitations of 3 years.
Since this case is in the United States District Court on diversity grounds only and we are dealing with a cause of action arising in California, the Pennsylvania rule on conflict of laws must be adopted as the law of this case. Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 85 L. Ed. 1477. The Pennsylvania rule is that its courts will refer to the place of the wrong for the legal effect to be given facts and events involved in the particular action, if the cause of action is created at the place of the wrong. Diesbourg v. Hazel-Atlas Glass Co., 3 Cir., 176 F.2d 410, Curtis v. Campbell, 3 Cir., 76 F.2d 84. The law of Pennsylvania recognizes a cause of action created at the place of the alleged wrongdoing. See Summer v. Brown, 312 Pa. 124, 167 A. 315; Restatement Conflict of Laws, Section 384(1), and this is so despite the fact that the foreign statute would result in a decision directly opposite to that which would result in the operation of the law of the forum. Mackey v. Robertson, 328 Pa. 504, 195 A. 870.
The first point to be settled is what is the nature of this cause of action. Applying the principles set forth in the above decided cases and the Restatement, we must look to the Courts of California for the interpretation of the nature of the cause of action. It would appear that this question was fairly presented to the District Court of Appeals, Second District, Division 3 of the Courts of California, in the case of the City of Los Angeles v. Howard, 80 Cal.App.2d 728, 182 P.2d 278. While the facts of that case are not strictly analogous to the facts of the instant case, the Court of Appeals was called upon to determine the nature of the right given to an employer under the statute above referred to, Section 3852 of the Labor Code. The Court of Appeals there specifically decided that the payments of money by the Plaintiff for medical attention and compensation to injured employees pursuant to obligation imposed upon it by the provisions of the Labor Code caused a property injury to the plaintiff within the meaning of the section of its probate code permitting claims against decedent's estate for property damage occasioned by the deceased in his lifetime. The language of the opinion in the case of Morris v. Standard Oil Co. in the Supreme Court of California, 200 Cal. 210, 214, 252 . 605, went to some pains to point out that the cause of action created by statute was a property injury to the employer and not one arising in favor of the employee by reason of injury. That case decided that the claim of the employer for payments made under the compensation statute was assignable within the meaning of the California law which permits the assignment of property claims but not the assignment of tort claims. It appears, therefore, that applying California law, the action in this case is to redress injury to property.
That brings us then to the point as to which statute of limitations to apply- the California statute or the Pennsylvania statute. The plaintiff here concedes that if the statute creating the right also contained a limitation, such limitation would be upon the right and at the termination of the period of limitation the right would be forever extinguished. The statute creating the right contains no limitation. It is, however, subject to the general statute of limitations of three years upon causes of actions created by California statute. That, therefore, is a limitation upon the remedy and is procedural. Consequently, courts sitting in Pennsylvania are free to disregard the California statute of limitations and apply the Pennsylvania statute of limitations, which in cases of causes of action for damage to property is 6 years. Pennsylvania statutes, however, have one further limitation. Title 12 Purdon Statutes, Section 39, Act of June 26, 1895, P.L. 375, Section 1, provides: 'When a cause of action has been fully barred by the laws of the state or country in which it arose, such bar shall be complete defense to an action thereon brought in any of the courts of this commonwealth.'
The court must ascertain whether the action is fully barred in the state of its origin. The California Code of Civil Procedure, Section 338(1), limits an action to enforce a liability created by statute to 3 years. That section, however, is subject to the provisions of Section 351 of the Code which provides, as follows: 'If when the cause of action accrues against a person, he is out of the state, the action may be commenced within the term herein limited, after his return to the state, and if, after the cause of action accrues, he departs from the state, the time of his absence is not part of the time limited for the commencement of the action.'
The defendant here is subject to that tolling statute and it clearly appears from the affidavit of W. E. Sedgwick, Esquire, attorney for defendant, in the case of John C. Turner, Plaintiff, v. Proctor and Schwartz, Defendant, No. 49209, Superior Court of the State of California in and for the County of San Mateo (a part of the record of this case), that Proctor and Schwartz, Defendant, was not subject to service of process in the State of California. The provisions of Section 351, therefore, apply and the action has not been fully barred in California. Therefore, the Pennsylvania statute of limitations is applicable. The present action is well within the six year period of limitations of Pennsylvania law.
Plaintiff's motion to strike the third defense must, therefore, be granted, and defendant's motion to dismiss must be denied.
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