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KELLY v. JOHNS-MANVILLE CORP.

August 7, 1984

John V. KELLY
v.
JOHNS-MANVILLE CORP., et al.



The opinion of the court was delivered by: POLLAK

 Plaintiff commenced this action against several manufacturers and distributors of asbestos products on December 21, 1981. Plaintiff alleges that defendants are liable to him for injuries that he sustained as a result of his exposure to asbestos over his working life as an insulator. Mr. Kelly initially claimed only that he had contracted asbestosis. He now claims that he suffers from epidermoid carcinoma caused by exposure to asbestos fibers. Plaintiff's counsel represented to the court at a conference on July 5, 1984, that at that time plaintiff had settled or voluntarily dismissed his claims against all but five defendants: Pittsburgh-Corning Corporation, Delaware Insulation Company, Porter Hayden Company, National Gypsum Company, and United States Gypsum Company. Since July 5, counsel have represented to the court that plaintiff has settled his claim against Pittsburgh-Corning, leaving only four defendants. *fn1"

 This court has adopted a procedure under which asbestos cases are initially assigned to one judge and then reassigned to another judge for trial. This case was originally assigned to Judge Troutman. It was reassigned to me for a trial which was to commence on July 9, 1984. During the first week of July, however, it became painfully clear that this matter was a long way from trial readiness.

 In the weeks preceding trial, the parties filed a flurry of motions. Surprisingly, two and one-half years after the commencement of this action, the parties had not resolved their discovery disputes to the point of satisfying each other as to the sufficiency of answers to interrogatories. On June 15, 1984, United States Gypsum filed a motion to compel plaintiff to make more specific answers to its interrogatories. Plaintiff responded to that motion on June 28 and, at the same time, filed his own motion to compel United States Gypsum to answer interrogatories. United States Gypsum filed its response to plaintiff's motion to compel on July 5 and also filed a supplemental memorandum in support of its own motion to compel at the same time. Meanwhile, plaintiff filed a second motion to compel answers to interrogatories on July 6, this time addressed to National Gypsum Company. Plaintiff had served National Gypsum with this motion before filing it with this court. National Gypsum responded to plaintiff's July 6 motion on July 5. Plaintiff filed a supplemental memorandum replying to National Gypsum's response on July 16. Thus, on the scheduled day of trial, the court would have faced three outstanding discovery motions.

 It was not merely discovery disputes that awaited resolution during the first week of July. On June 22, National Gypsum filed a motion for summary judgment based principally upon plaintiff's inability to adduce evidence that he was exposed to National Gypsum products. *fn2" Plaintiff provided the court with a response to that motion on July 5 and filed the response on July 6. *fn3"

 On June 28, Porter Hayden filed a motion for summary judgment principally based upon plaintiff's failure to adduce any evidence of exposure to products distributed by Porter Hayden during any period when plaintiff was not employed by Porter Hayden. Porter Hayden asserted the New Jersey workers' compensation statute as a bar to plaintiff's recovery. See N.J.Stat.Ann. 34:15-8 (West Supp.1984). Plaintiff responded to this motion on July 5, filing the response on July 6.

 On June 29, National Gypsum filed a second motion for summary judgment based upon the statute of limitations. All other defendants have since joined in this motion. Plaintiff responded to National Gypsum's second motion on July 5, filing the response on July 6.

 On July 5, Delaware Insulation Company filed a motion for summary judgment asserting the Pennsylvania workers' compensation statute as a defense to plaintiff's claim. See Pa.Stat.Ann. tit. 77, § 481 (Purdon Supp.1983). Plaintiff has never responded to Delaware Insulation's motion.

 Finally, on July 6, United States Gypsum filed a motion for summary judgment based upon plaintiff's inability to adduce evidence of his exposure to United States Gypsum's products. Plaintiff responded to this motion on July 16.

 Obviously, on July 3, this court was not aware of all of the motions that the parties would file. However, by that day I faced an unjoined motion to compel answers from United States Gypsum. Moreover, I faced two unjoined motions for summary judgment filed by National Gypsum and one filed by Porter Hayden. I therefore decided to schedule oral argument on the pending motions for July 5 at 2:00 p.m.

 At 1:58 p.m. on July 5 my law clerk first received a copy of Delaware Insulation's motion for summary judgment. At 2:12 p.m. counsel for plaintiff arrived with responses to National Gypsum's motions for summary judgment and to Porter Hayden's motion, and with an additional motion to compel answers to interrogatories from National Gypsum. I thereupon decided to forego oral argument on the pending motions and to engage the parties in settlement discussions. These discussions proved fruitless, as did further discussions that afternoon conducted by Judge Weiner. Accordingly, on Friday, July 6, I asked my law clerk to inform counsel that I would postpone trial and that they could have until July 12 to supplement any of their submissions. Following this chamber's usual practice, my law clerk called counsel for one party, in this case National Gypsum, and advised her of the new timetable and requested her to inform all other counsel. National Gypsum's counsel apparently misunderstood this request and failed to inform plaintiff's counsel of the July 12 deadline for supplemental submissions. Plaintiff's counsel did not learn of this deadline until July 11, when she requested an extension until Monday, July 16, which I granted.

 On July 12, Porter Hayden, United States Gypsum, and National Gypsum filed supplemental memoranda. On July 16, plaintiff filed four supplemental memoranda addressed to various of the pending motions. This Memorandum and the accompanying Order resolve the pending motions.

 1. Choice of Law

 The parties disagree over which state's substantive law should govern this diversity action. Plaintiff takes the position that New Jersey law governs all claims in this case and all defenses except Delaware Insulation's defense based upon the Pennsylvania Workmen's Compensation Act. On the other hand, all defendants except Porter Hayden take the position that Pennsylvania law governs plaintiff's claims and all defenses. Porter Hayden takes what would seem to be somewhat inconsistent positions. On the other hand, Porter Hayden contends that New Jersey substantive law governs plaintiff's claim against it, but on the other hand Porter Hayden has adopted National Gypsum's motion for summary judgment on the statute of limitations ground, a motion which argues for the application of Pennsylvania substantive law.

 Plaintiff cites no authority for the application of New Jersey law other than Klaxon v. Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1940), and Griffith v. United Airlines, Inc., 416 Pa. 1, 203 A.2d 796 (1964). Klaxon, of course, merely requires a district court in a diversity action to apply the choice of law rule of the state in which it sits. Griffith states, in general fashion, the Pennsylvania choice of law rule. Griffith announced the Pennsylvania Supreme Court's abandonment of "the strict lex loci delicti rule . . . in favor of a more flexible rule which permits analysis of the policies and interests underlying the particular issue before the court." 416 Pa. at 21, 203 A.2d at 806 (footnote omitted). This "more flexible rule" combines Professor Currie's "interest analysis" and the approach taken by the Restatement (Second) of Conflict of Laws. Brown v. Santonella, Civil Action No. 83-4016, slip op. at 4-5(E.D.Pa. May 22, 1984).

 As framed by counsel, plaintiff's argument as to why Griffith mandates the application of New Jersey law is unenlightening:

 
Plaintiff, a New Jersey resident alleges exposure to asbestos products supplied by the remaining defendants while employed at job locations in New Jersey. There are sufficient [sic] connections with Pennsylvania since the release of other defendants to this action. Thus, the substantive law of the State of New Jersey is to be applied.

 Plaintiff's Supplemental Memorandum of Law in Opposition to National Gypsum Company's Motion for Summary Judgment Based on the Statute of Limitations at 2.

 I read this argument as a contention that both the Second Restatement approach and "interest analysis" dictate the application of New Jersey substantive law to this action. Plaintiff asserts that he is a resident and citizen of New Jersey. He claims that all of his exposure to the remaining defendants' products occurred in New Jersey. *fn4" Plaintiff's complaint also alleges that none of the remaining defendants is a Pennsylvania corporation nor does any of the remaining defendants have a principal place of business in Pennsylvania.

 This analysis is complicated, however, by the question whether a Pennsylvania court would apply Pennsylvania's choice of law rules separately to plaintiff's claim against each defendant. Plaintiff's injury is not easily divisible. Mr. Kelly has allegedly suffered two diseases as the result of a lifetime of exposure to asbestos in New Jersey, Pennsylvania, and other states. *fn5" A Pennsylvania court applying Pennsylvania's choice of law rule to plaintiff's claim on the basis of the totality of his exposures to asbestos might conceivably opt for Pennsylvania substantive law. *fn6"

 It appears, however, that the Court of Common Pleas for Philadelphia County has taken the position that in a multi-defendant asbestos case, the plaintiff's separate claims are to be treated as discrete causes of action. This is the lesson to be learned from that court's action in severing all asbestos claims against defendants petitioning under the Bankruptcy Act. See Matthews v. Johns-Manville Corp., 307 Pa. Super. 300, 453 A.2d 362 (1982) (quashing appeal). Our court has followed that lead. See Order of Judge Troutman (March 2, 1984); see also Gold v. Johns-Manville Corp., 723 F.2d 1068 (3d Cir.1983)(dismissing appeal).

 The separation of one defendant, or set of defendants, from the rest of an asbestos action shows that an asbestos claim does not form an indivisible whole. Therefore, the claims presented here relate only to the exposure of plaintiff in New Jersey to asbestos products manufactured or distributed outside of Pennsylvania by the four remaining defendants, none of which has its principal place of business in Pennsylvania. Accordingly, it would seem that a Pennsylvania court would apply New Jersey law to plaintiff's claims against each of the four remaining defendants.

 2. Statute of Limitations

 a. Applicable Standards

 National Gypsum has moved for summary judgment on the ground that this action is barred by Pennsylvania's two-year statute of limitations for personal injury actions, 42 Pa.Cons.Stat.Ann. § 5524 (Purdon Supp.1983). In the alternative, National Gypsum takes the position that this action would similarly be barred by New Jersey's two-year statute of limitations for like actions, N.J.Stat.Ann. 2A:14-2 (West 1952). All other remaining defendants have joined in National Gypsum's motion.

 Both Pennsylvania and New Jersey have adopted the "discovery rule" for the beginning of the limitation period. In either state, the limitation period runs from the time that "the plaintiff has discovered his injury, or, in the exercise of reasonable diligence, should have discovered his injury." Cathcart v. Keene Industrial Insulation, 324 Pa.Super. 123, 471 A.2d 493, 500 (1984) (asbestos case); accord Jarusewicz v. Johns-Manville Products Corp., 188 N.J.Super. 638, 458 A.2d 156, 158 (Law Div.1983) (asbestos case).

 The difference between the two states' rules lies in their application of the limitation bar. "In Pennsylvania a plaintiff's claims for all injuries arising out of the same tortious conduct of a defendant must be brought within two years of the time that the plaintiff knows, or in the exercise of reasonable diligence should know, of his initial injury and that the injury was caused by someone's wrongful conduct." Cathcart, 471 A.2d at 507 (emphasis in original). Under this rule, if plaintiff discovers that he has asbestosis more than two years before he commences an action and then later develops cancer which he attributes to exposure to asbestos, both plaintiff's asbestosis claim and his cancer claim are barred. On the other hand, our Court of Appeals has held that New Jersey follows the opposite rule, precluding the asbestosis but admitting the cancer claim. Goodman v. Mead Johnson & Co., 534 F.2d 566, 574 (3d Cir.1976). Since the decision in Goodman, no reported opinion of a New Jersey court has questioned Goodman's holding.

 Because I have held that New Jersey substantive law applies to plaintiff's claims against the remaining defendants, New Jersey's definitions of those claims for the purpose of applying its statute of limitations apply as well. Thus, Goodman, and not Cathcart, provides the rule in this case. *fn7"

 As discussed more fully below, defendants contend that Mr. Kelly, in the exercise of reasonable diligence, should have known of his asbestosis more than two years before he commenced this action on December 21, 1981. Plaintiff, however, asserts claims for two allegedly asbestos-related diseases: asbestosis and epidermoid carcinoma. Defendants do not contend that Mr. Kelly should have known of his cancer's relation to asbestos exposure more than two years before Mr. Kelly commenced this action. Accordingly, under New Jersey law, Mr. Kelly's cancer claim cannot be barred by the statute of limitations.

 In support of their claim that Mr. Kelly's asbestosis claim is barred by the statute of limitations, defendants adduce two forms of evidence. The first is a letter from Jeffrey A. April to Dr. Robert L. Krasney dated October 15, 1975. The second is plaintiff's deposition testimony of July 2, 1984. For reasons elaborated below, Mr. April's letter does not support defendants' contentions. However, Mr. Kelly's deposition testimony could not leave a reasonable jury in doubt that Mr. Kelly, in the exercise of reasonable diligence, should have known of his injury from exposure to asbestos in 1975 and that Mr. Kelly knew in 1975 that his injury was actionable.

 b. April Letter

 Jeffrey April, who plaintiff claims was not an attorney, worked for an Atlantic City law firm that Mr. Kelly had consulted concerning his divorce. Kelly Deposition at 196. *fn8" Dr. Krasney, now deceased, was an internist at the Hospital of the University of Pennsylvania who treated Mr. Kelly for heart ailments. Kelly Deposition at 197. National Gypsum has submitted a letter from Mr. April to Dr. Krasney which reads as follows:

 
October 15, 1975
 
Dr. Robert L. Krasney
 
4127 Atlantic Ave.
 
Atlantic City, NJ
 
John V. Kelly
 
Dear Dr. Krasney:
 
We represent John D. [sic] Kelly, who was treated by you approximately three months ago and in the course of x-raying John, you discovered what is known as White Lung or Asbestosis.
 
Mr. Kelly has informed us that you told him that the Asbestosis is job-induced, because of his work with Asbestos. Please send to us a report on John's condition as to the Asbestosis. If it is possible at this time, please inform us whether the Asbestosis constitutes a permanent partial disability and if it does, what the percentage [sic] would be. Also, what the progression of the Asbestosis is and whether or not it has at least abated, would be greatly appreciated.
 
Enclosed is an Authorization for this report, executed by Mr. Kelly. If there is any charge for this, kindly notify us and a check will be issued.
 
Thank you for your attention in this matter.
 
Kindest personal regards,
 
/s/ Jeffrey A. April
 
Jeffrey A. April, for
 
GOLDSMITH, LAND
 
& FINIFTER
 
JAA:db
 
cc: Mr. Kelly

 Supplemental Memorandum of Defendant National Gypsum, exh. A

 Defendants offer this letter for two purposes. First, the letter asserts that Mr. Kelly informed Mr. April that Dr. Krasney had told Mr. Kelly that Mr. Kelly's x-rays showed job-induced asbestosis. Second, the letter shows that Mr. Kelly was to have received a copy; this copy would have given Mr. Kelly notice of the matters asserted in the letter.

 Federal Rule of Civil Procedure 56(e) permits a party to support a motion for summary judgment with affidavits "made on personal knowledge [which] shall set forth such facts as would be admissible in evidence [and which] shall show affirmatively that the affiant is competent to testify to the matters stated therein." Mr. April's letter does not qualify as an affidavit. Moreover, defendants have not authenticated Mr. April's letter with Mr. April's affidavit or some substitute affidavit.

 Plaintiff has not, however, challenged the authenticity of Mr. April's letter. Treating Mr. April's letter as if Mr. April had provided defendants with an affidavit authenticating the letter, Mr. April's letter is still not admissible to show that Mr. Kelly stated that Dr. Krasney had told him that Dr. Krasney had discovered asbestosis in Mr. Kelly's x-rays. The contents of the letter constitute an out-of-court statement by Mr. April offered for the truth of the matter asserted: what Mr. Kelly told Mr. April. The contents of the letter are therefore classic hearsay not within any exception. *fn9" Accordingly, defendants may not offer Mr. April's letter for its first purpose; Mr. April's letter does not show that Mr. Kelly told Mr. April that Dr. Krasney had found traces of asbestosis in Mr. Kelly's x-rays.

 For purposes of this motion for summary judgment, I cannot consider Mr. April's letter's "cc: Mr. Kelly" as evidence that Mr. Kelly in fact received a copy. Not only is this also hearsay, but Mr. Kelly denied seeing the letter until a few days before his July 2, 1984, deposition: "I seen this letter for the first time the other day. I never seen it before." Kelly Deposition at 198. At the very most, a material issue of fact exists as to whether Mr. Kelly received a copy of Mr. April's letter.

 c. Kelly Deposition

 Mr. Kelly's statements at his deposition, however, would not permit a reasonable jury to conclude that Mr. Kelly should not in the exercise of reasonable diligence have known that he suffered from asbestosis in 1975. Mr. Ryan, counsel ...


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