Monessen v. Southwestern R. Co. v. Morgan, 486 U.S. 330 (1988)

Monessen v. Southwestern Railway Co. v. Morgan

No. 86-1743

Argued February 22, 1988
Decided June 6, 1988
486 U.S. 330

APPEAL FROM THE SUPREME COURT OF PENNSYLVANIA

Syllabus

Appellee suffered a permanent back injury while working as a brakeman and conductor for appellant railroad. After returning to work in a less physically demanding position, appellee brought an action under the Federal Employers’ Liability Act (FELA) in a Pennsylvania state court, alleging that his injury was attributable to appellant’s negligence and that his future earning power had been impaired as a result of his injury. The trial judge refused to instruct the jury that any damages award for loss of future earnings should be reduced to present value, but instead informed the jury that the law (apparently referring to Pennsylvania case law) "now provides that there need not be such a reduction." After the jury found for appellee and awarded damages, the trial judge assessed an additional amount as prejudgment interest pursuant to Pennsylvania Rule of Civil Procedure 238, which requires state courts in personal injury actions to add to compensatory damages 10 percent per year, as "damages for delay," from the date the complaint was filed or from the date one year after the cause of action accrued, whichever was later, to the date of the verdict. The Pennsylvania Superior Court affirmed. The Pennsylvania Supreme Court also affirmed, characterizing Rule 238 as a mere "rule of procedure," and holding that it was not inconsistent with FELA. It also held that whether the trial judge properly refused to instruct the jury to discount future damages to present value and instead applied the "total offset" method, under which future inflation is presumed equal to future interest rates, was a question of federal law, and that the judge’s use of the total offset rule was not inconsistent with St. Louis Southwestern R. Co. v. Dickerson, 470 U.S. 409.

Held:

1. State courts may not award prejudgment interest pursuant to local practice in FELA actions. Pp. 334-339.

(a) The proper measure of damages under FELA -- including the question whether prejudgment interest may be awarded to a prevailing plaintiff -- is inseparably connected with the right of action, and therefore is an issue of substance that must be settled according to federal law, rather than state law. The Pennsylvania courts cannot avoid the application of federal law by characterizing Rule 238 as nothing more than a procedural device to encourage settlements and relieve court congestion. Pp. 335-336.

(b) Federal law does not authorize awards of prejudgment interest in FELA actions. Although neither FELA nor the general federal interest statute, 28 U.S.C. § 1961, mentions prejudgment interest, when Congress enacted FELA in 1908, the common law did not allow prejudgment interest in suits for personal injury or wrongful death, and that was the rule in the federal courts. In enacting FELA, Congress expressly dispensed with other common law doctrines of that era, and there is no indication that Congress intended to abrogate the doctrine barring prejudgment interest sub silentio. Moreover, the lower federal courts and the state courts have held with virtual unanimity that prejudgment interest is not available under FELA. Congress’ failure to disturb such a longstanding, consistent judicial interpretation of a statute indicates that Congress at least acquiesces in, and apparently affirms, that interpretation. Pp. 336-339.

2. The trial court did not act consistently with federal law in instructing the jury not to discount appellee’s future lost earnings to present value. St. Louis Southwestern R. Co. v. Dickerson, supra. The jury has the task of making the present value determination in FELA cases, but it is permissible for the judge to recommend to the jury one or more methods of calculating present value so long as the judge does not, in effect, preempt the jury’s function. In the present case, however, the trial judge instructed the jury that a zero discount rate was to be applied as a matter of law to appellee’s future damages. The instruction improperly took from the jury the essentially factual question of the appropriate rate at which to discount appellee’s FELA award to present value. Pp. 339-342.

513 Pa. 86, 518 A.2d 1171, reversed and remanded.

WHITE, J., delivered the opinion of the Court, in which BRENNAN, STEVENS, SCALIA, and KENNEDY, JJ., joined, in Parts I, II-A, and III of which MARSHALL and BLACKMUN, JJ., joined, and in Parts I and II of which REHNQUIST, C.J., and O’CONNOR, J., joined. BLACKMUN, J., filed an opinion concurring in part and dissenting in part, in which MARSHALL, J., joined, post, p. 342. O’CONNOR, J., filed an opinion concurring in part and dissenting in part, in which REHNQUIST, C.J., joined, post, p. 350.