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April 22, 1982


The opinion of the court was delivered by: Shadur, District Judge.


This diversity action is in part a garden-variety personal injury case arising out of an automobile accident in which plaintiffs Paul Zawadzki ("Zawadzki") and Kenneth Cantor ("Cantor") were passengers in a taxicab owned by Checker Taxi Company ("Checker"). What distinguishes it from the run of the mill is that Counts III, IV and V are brought by three corporations that employ Zawadzki and Cantor, claiming that the negligence of Checker and its driver have injured the employers by depriving them of the Zawadzki-Cantor services, sales and hence profits. Checker has moved to dismiss those counts for failure to state a cause of action.

Initially this Court, provided with no real assistance in briefing or research by either side, denied Checker's motion. It stated:

  Because neither side has provided the Court with
  thoughtful analysis or controlling authority, it
  will simply refer to the rule as stated in
  Prosser, Handbook of the Law of Torts § 129, at 938
  (4th ed. 1971):
  . . . in general, liability has not been extended
  to the various forms of negligence by which
  performance of a contract may be prevented or
  rendered more burdensome. There is one
  conspicuous exception. The earlier rule under
  which one who negligently injured a servant
  became liable to his master for loss of his
  services, apparently is still alive and good law;
  and to the extent that there are services lost,
  of value, the employer can recover damages.

Although Prosser says the rule "has, however, been under considerable attack of late" (citing among other law review articles one by Professor Seavey, Liability to Master for Negligent Harm to Servant, 1956 Wn.U.L.Q. 309), defendants have adduced nothing to show that the anciently-rooted common law rule does not still apply in Illinois (the jurisdiction to which this Court looks under Erie v. Tompkins principles).*fn2

*fn2 This case illustrates once again the deficiencies in the Erie doctrine to which this Court has addressed itself on a number of occasions. Were this Court in the state court system and convinced that Professor Seavey's arguments are sound, it could dismiss the employers' actions in full confidence that the Illinois appellate courts would then speak to the issue in definitive terms. But neither that assurance nor its equivalent — the ability to certify a question to the state Supreme Court — is available. This Court must therefore engage in the predictive process with no input other than the existence of an ancient common law rule and the fact that Illinois is a common-law state.

Now Checker, apparently taking the matter with greater seriousness, has renewed the motion. Each side has provided further briefing.

Research by plaintiffs' counsel has still not turned up any cases that allow an action in favor of a corporation for the loss incurred as a result of the negligent injury of its employees. Indeed Prosser is to some extent balanced by 1 Harper & James, Law of Torts § 6.10, at 506 (1956), which states such an action cannot lie where defendant has acted only negligently rather than intentionally.

As the earlier opinion indicated there is no Illinois case in point, and under Erie Illinois law provides the substantive rule of decision. But every recent case referred to in the parties' rebriefing refuses to recognize the action the plaintiff corporations seek to ground in Counts III, IV and V. This Court's own research has disclosed additional authority favorable to defendants and none to the plaintiff corporations. Thus the following recent decisions, relying on either common law or a related statute, have refused to allow corporations to recover for losses occasioned by negligent injuries to their employees: Phoenix Professional Hockey Club, Inc. v. Hirmer, 108 Ariz. 482, 502 P.2d 164 (1972); Nemo Foundations, Inc. v. New River Co., 155 W. Va. 149, 181 S.E.2d 687 (1971); Snow v. West, 250 Or. 114, 440 P.2d 864 (1968); Frank Horton & Co. v. Diggs, 544 S.W.2d 313, 316-17 (Mo.App. 1976); Baughman Surgical Associates, Ltd. v. Aetna Cas. & Surety Co., 302 So.2d 316 (La.App. 1974); Ferguson v. Green Island Contracting Corp., 44 A.D.2d 358, 355 N.Y.S.2d 196 (App. Div. 1974); Steele v. J & S Metals, Inc., 32 Conn. Sup. 17, 335 A.2d 629 (Super.Ct. 1974); Preiser Scientific, Inc. v. Piedmont Aviation, Inc., 432 F.2d 1002 (4th Cir. 1970) (West Virginia law); Standard Oil Co. v. United States, 153 F.2d 958, 961-62 (9th Cir. 1946) (California law).

Absent any significant Illinois precedent, this Court's duty under Erie is to engage in an Illinois-Supreme-Court-predictive process that must look to the best available sources of law.*fn1 It has no difficulty in predicting that Illinois courts, faced with the issue, would follow the unanimous recent trend of the cases elsewhere. There is no recent authority to the contrary.*fn2

Plaintiff corporations can respond only that Illinois courts have never explicitly overruled the common law rule as stated by Prosser.*fn3 That argument is not persuasive. It only demonstrates that (simply because no such actions have reached the appellate level) Illinois law has not had the opportunity or occasion to do so.


For the reasons stated in this memorandum opinion and order, Checker's motion to dismiss Complaint Counts III, IV and V is granted. This action will proceed solely on behalf ...

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