486 F. 2d 493 - Ramirez v. Autobuses Blancos Flecha Roja Sa De Cv

Ana Maria S. De Ramirez, purchased a one way bus ticket from Autobuses Blancos Flecha Roja, a Mexican corporation, in Laredo, Texas for transportation from Laredo to Saltillo Coahuila, Mexico. While in Mexico enroute to Saltillo, the bus was involved in a serious collision resulting in the death of Mrs. Ramirez.

The administrators of the estate and next best friend of the minor children instituted this diversity action in the District Court for the Southern District of Texas seeking to recover damages for loss of support, and loss of earnings as well as for pain and suffering and funeral expenses. The District Court dismissed the claims for loss of support and earnings on the grounds that this type of recovery would be governed by the applicable wrongful death act and the Texas Wrongful Death Act1 was clearly inapplicable because it does not have any extraterritorial effect and the courts of Texas would not apply the applicable law of Mexico due to its dissimilarity to the law of Texas.

The District Court also dismissed the claim for damages for pain and suffering and funeral expenses based on a breach of contract theory due to Appellant's failure to amend its complaint or offer affidavits2 specifying what amount of the aggregate damages were attributable to pain, suffering3 and funeral expenses in order that the court could determine whether the facts as alleged satisfied the requisite jurisdictional amount in absence of the wrongful death claim. Appellant challenges the dismissal of the wrongful death claim. Having determined that this claim is precluded by Texas statute and precedent we affirm.

In Marmon v. Mustang Aviation, Inc., 1968, 430 S.W.2d 182 the Supreme Court of Texas has recently reaffirmed the principle that for choice of law purposes the "place of the injury" rule determines whether the Texas Wrongful Death Act applies.4 In Marmon the Court held that where Texas residents were killed when an airplane chartered in Texas crashed in Colorado because of the negligence of a Texas pilot while returning to Texas, the Wrongful Death Act of Colorado rather than Texas provided the appropriate remedy. Marmon would appear to preclude the application of the Texas Wrongful Death Act to the instant case where a Mexican national having purchased her ticket in Texas died as the result of a bus collision in Mexico.

Appellant attempts to circumvent this result by alleging that appellee breached its implied contractual duty of safe carriage5 thereby invoking the "place of the execution" rule as the choice of law determinant in contract cases, distinguishing Marmon as a mere tort case.

In support of its breach of contract theory appellant relies on Hudson v. Continental Bus System, Inc., Tex.Civ.App., 1958, 317 S.W.2d 584 and Garza v. Greyhound Lines, Inc., Tex.Civ.App. 1967, 418 S.W.2d 595 each of which is binding on us. See Ford Motor Co. v. Mathis, 5 Cir., 1963, 322 F.2d 267, 269. In Hudson, a Texas resident who had purchased a round trip guided tour ticket from an American bus company was injured while being transported by automobile in Mexico by a connecting carrier. The Texas court allowed the plaintiff to state a personal injury claim against the bus company based on the company's breach of its implicit contractual duty of safe carriage. By allowing the plaintiff to phrase its claim in terms of contract, the Court was able to invoke the place of execution rule for conflicts purposes thereby avoiding the preclusive effect of the place of injury rule. The Court employed the same rationale in Garza v. Greyhound Lines, Inc. on substantially similar facts.

Appellant's attempt to avoid Marmon founders, however, on the very real distinction between personal injury and wrongful death actions. "A cause of action for wrongful death is not simply a more severe personal injury case."6 Rather it is a separate statutorily created cause of action unknown to the common law. In Marmon, the Supreme Court of Texas attempted to divine the legislative intent underlying the Texas Wrongful Death Act and concluded that it was clear that the statute was not intended to have any extraterritorial effect-that is it was not intended to apply to deaths resulting from injuries occurring outside the physical boundaries of the state of Texas. Whether a claim is phrased in terms of contract or tort the result must be the same-the Texas Wrongful Death Act as recently and authoritatively construed is not an available remedy where the injury causing death did not occur on Texas soil.

Eubanks v. Schwalbe, 1933, Tex.Civ.App., 55 S.W.2d 906, modified on other grounds, 126 Tex. 405, 87 S.W.2d 248 is not authority for the proposition that a plaintiff may base recovery under the Texas Wrongful Death Act on a breach of contract claim. In Eubanks, a contractor involved in excavation near a state highway breached its agreement with the state to place a barrier and warning lights near the excavation. The Court held that the wife of an individual who was killed as a result of the negligent excavation could maintain a wrongful death action even though the defendant's duty to provide adequate precautions had arisen out of a contract (with a third party). The Court found, however, that the contractor's negligence constituted a tortious breach of its duty to travelers and it was this breach of duty which gave rise to the wrongful death action.7

The more recent case of Goelz v. J. K. & Susie L. Wadley Research Institute and Blood Bank, Tex.Civ.App., 1961, 350 S.W.2d 573 strongly suggests that the Texas Wrongful Death Act will not support a claim for recovery arising under a breach of contract theory. In Goelz, the husband of decedent brought a wrongful death action against a blood bank which had caused decedent's death by furnishing blood of the incorrect type for a transfusion. The plaintiff based claims for relief on contract as well as tort theories. After dismissing the tort theory on the basis of charitable immunity the Court observed that a theory based on breach of an implied warranty was not cognizable under the Wrongful Death Act. Rather where a breach of contract also constitutes a tort, "[the] cause of action may ordinarily arise under our death statute on grounds of tort not breach of contract as such."8

Texas recognizes that a breach of the contractual duty of safe carriage is a type of tortious conduct for which the law provides a remedy. But we are convinced that the Texas courts would follow Marmon and apply the "place of the injury" rule to resolve choice of law questions concerning the application of the Wrongful Death Act to a breach of this duty regardless of whether the duty arose out of a contract-the purchase of a bus ticket. Applying the place of the injury rule, the law of Texas is inapplicable since the injury arose out of a bus collision in Mexico allegedly attributable to the gross negligence of the bus driver.

It is far from clear that appellant would fare any better under the Texas choice of law rules even if the death action could be based on a contract theory. In Texas, the law of the place where the contract is made generally governs. Austin Building Company v. National Union Fire Insurance Company, Tex.1968, 432 S.W.2d 697. When a contract is made in one state to be performed in another, the place of performance governs. Castilleja v. Camero, Tex.1967, 414 S.W.2d 424. And where a contract is to be performed in more than one place, the place of making governs unless the parties intended otherwise. Hatchett v. Williams, Tex.Civ.App., 1968, 437 S.W.2d 334, cert. denied, 396 U.S. 963, 90 S.Ct. 437, 24 L.Ed.2d 427.

In attempting to invoke the law of Texas appellant relies on Hudson v. Continental Bus System, Inc., Tex.Civ.App., 1958, 317 S.W.2d 584 at 589 where the Court stated "'it has been held that a contract cannot be construed with reference to a foreign law, unless the intent of the parties to be governed by such law is evidence from the instrument itself without the aid, of extrinsic evidence.' There is nothing in this record to indicate any intention on the part of the parties that the law of the foreign country of Mexico would apply" quoting 17 C.J.S. Contracts Sec. 330. In Hudson an American citizen had purchased a round trip tour ticket to Mexico from an American bus company. The present case, however, involves a Mexican National who purchased a one way bus ticket to Mexico printed in Spanish, in a Texas border town from a Mexican bus company which did not operate between cities in the United States. While the contract was made in Texas it was to be performed almost entirely in Mexico.9

Unlike Hudson the facts of this case lend more support to the inference that the parties may have assumed that the laws of Mexico rather than Texas governed this transaction and its incidents. We need not resolve this question, however, since we are convinced that the Texas courts would not allow a plaintiff to avoid the "place of the injury rule" under the Wrongful Death Act by phrasing the claim in terms of contract.

Of course the plaintiff is not immediately out of court once it is determined that the substantive law of the forum state is inapplicable. The Texas Wrongful Death Act specifically provides that:

"Whenever the death or personal injury of a citizen of this state or of the United States, or any foreign country having equal treaty rights with the United States on behalf of its citizens, has been or may be caused by the wrongful act, neglect or default of another in any foreign state or country for which a right to maintain an action and recover damages thereof is given by the statute or a law of such foreign state or a country, such right of action may be enforced in the courts of this State within the time prescribed for the commencement of such actions by the statutes of [the] State."10

This would appear to grant the courts of Texas a clear mandate to apply the law of Mexico where applicable. Nevertheless, as the District Court noted, the Texas courts have consistently refused to apply the tort laws of the Republic of Mexico and its political subdivisions where it has been determined that those laws are applicable on the ground that they are too dissimilar to the laws of Texas. See Carter v. Tillery, Tex.Civ.App., 1957, 257 S.W.2d 465; El Paso and Juarez Traction Co. v. Carruth, Tex.Com.App., 1923, 255 S.W. 159. See also Mexican National Railway Company v. Jackson, 89 Tex. 107, 33 S.W. 857 (decided prior to the enactment of Article 4678).

Appellee has offered proof of the applicable laws of the Republic of Mexico and of the state of Nuevo Leon where the accident occurred.11

The fact of the dissimilarity is not challenged. The Appellee asserts without any contradiction a number of dissimilarities which we credit with no independent research into Mexican law. 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.12 Damages known as "moral reparations" are also available.13 In addition, "imprudent" actions may also constitute a criminal offense and an individual convicted of such an offense may be required to provide restitution to the injured victim or his family either through a fine imposed or by means of the proceeds earned through prison labor.14

We are confident that despite the existence of article 4678, the Texas courts under the judicially recognized doctrine of dissimilarity would refuse to attempt to apply the unfamiliar remedial provisions of the Mexican tort law.

Having determined that the Wrongful Death Act of Texas is inapplicable and that the law of Mexico would appear to provide the only other available remedy, we must follow the law of Texas and affirm the District Court's dismissal of the appellant's claim15 without prejudice to any future attempt to bring this action in a different and more appropriate forum.

Affirmed.