The opinion of the court was delivered by: JAMES B. MORAN
Plaintiff Andrew Thomas (Thomas) brought this diversity action against defendants Bombadier-Rotax Motorenfabrik, GmbH (Rotax), an Austrian corporation, and Decker Aero Power, Inc. (Decker Aero), alleging that defendants were negligent, had breached an implied warranty of safety, and are strictly liable for the injuries sustained by him when his experimental ultra-light aircraft crashed during a test flight. The aircraft was equipped with an engine manufactured by defendant Rotax, and was sold to him by defendant Decker Aero. Before us now is defendants' motion to bar evidence relating to the engine and the ultra-light aircraft, alleging that Thomas has failed to preserve the material evidence in this case, specifically the engine and the ultra-light aircraft. For the following reasons defendants' motion is denied.
Before 1991 Thomas piloted planes on only a recreational basis. Of particular interest to him was a type of aircraft called "ultra light" aircraft (Thomas Dep. at 15). Thomas decided that he could design a better ultra-light aircraft than was currently offered on the market,
and in 1991 he formed a corporation, Desert Hawk Flight Works, Inc. (Flight Works), through which he intended to design, build, and ultimately sell his creations. (Id. at 7.) After working in the design business full-time, Thomas developed an ultra-light aircraft he called the "Prairie Hawk." (Id. at 9.) He equipped the prairie Hawk with an engine manufactured by Rotax and sold to him by Decker Aero.
On May 7, 1992, Thomas took the Prairie Hawk on a test flight. According to Thomas, the engine suddenly stopped at an altitude of approximately 300 feet and crashed into the ground. Allegedly, Thomas was severely injured in the accident. Six weeks later Thomas returned to the hangar and inspected the Prairie Hawk to determine the cause of the crash. Id. at 40. He was unable to determine the cause for the engine failure himself, so he turned to Decker Aero for assistance. Id. at 39-40. Over the phone Steve Decker, president of Decker Aero, walked Thomas through different checks of the engine. Id. After this phone consultation revealed that one of the pistons was damaged, Decker suggested that Thomas send the engine back to Decker Aero so that it could be taken apart to determine the cause and to make repairs. Id. Decker Aero took the engine apart and discovered the magneto side cylinder head had been installed backwards (Mielke Dep. at 31). It replaced the damaged parts and sent the engine back to Thomas (Decker Dep. at 52). At no time did Thomas reveal that he was injured or was contemplating litigation. The Prairie Hawk aircraft itself did not make out so well. Aside from a few salvageable parts, the aircraft was destroyed. Thomas salvaged what he could and then sold the rest for scrap.
Thomas filed a diversity action against Decker Aero and Rotax, alleging that they are liable for the injuries he suffered during the crash. Thomas brings three counts, one alleging negligence, one alleging strict liability, and one alleging breach of implied warranty. Decker Aero filed a motion to dismiss on jurisdictional grounds, which this court denied on August 5, 1993. Rotax then filed this present motion, in which Decker Aero joins, alleging that by sending the engine off to be repaired, and by disposing of the Prairie Hawk, Thomas has failed to preserve the material evidence in this case, and asks this court to bar any evidence relating to the condition of the aircraft or the engine. Defendants also seek summary judgment on the grounds that, if they are successful in barring the evidence, Thomas could not make out a prima facie case without the barred evidence.
A. Illinois or Federal Law
As an initial matter we must determine whether defendants' motion is governed by Illinois or federal law. Since this court is sitting in diversity we must apply the substantive rules of Illinois, Erie v. Tompkins, 304 U.S. 64, 82 L. Ed. 1188, 58 S. Ct. 817 (1938), and the procedural rules of the federal courts. Hanna v. Plumer, 380 U.S. 460, 465, 14 L. Ed. 2d 8, 85 S. Ct. 1136 (1965). The question arises whether the preservation of material evidence is a matter of procedure or substance. Judge Aspen has concluded that under the "outcome determinative" test employed in Guaranty Trust Co. of New York v. York, 326 U.S. 99, 109, 89 L. Ed. 2079, 65 S. Ct. 1464 (1945), "[the] pre-suit duty to preserve material evidence is substantive and, as such, Illinois law governs." State Farm Fire & Casualty v. Frigidaire, 146 F.R.D. 160, 162 (N.D. Ill. 1992). We agree with Judge Aspen and look to Illinois law to examine defendants' claim.
B. Motion to Bar Evidence
Illinois Supreme Court Rule 219(c) gives trial courts the discretion to bar evidence or dismiss an action for unreasonable noncompliance with discovery rules. Shelbyville Mut. Ins. Co. v. Sunbeam Leisure Products Co., 262 Ill. App. 3d 636, 634 N.E.2d 1319, 1323, 199 Ill. Dec. 965 (5th Dist. 1994). Given that "the preservation of an allegedly defective product is of utmost importance in both proving and defending against a strict liability action," Graves v. Daley, 172 Ill. App. 3d 35, 526 N.E.2d 679, 681, 122 Ill. Dec. 420 (3d Dist. 1988), a number of Illinois appellate courts
have concluded that the destruction of material evidence, such as the defective product in a strict liability action, is a violation of discovery rules appropriate for sanctions. See Shelbyville Mut. Ins. Co. v. Sunbeam Leisure Products Co., 262 Ill. App. 3d 636, 634 N.E.2d 1319, 199 Ill. Dec. 965 (5th Dist. 1994); H & H Sand & Gravel Haulers Co. v. Coyne Cylinder Co., 260 Ill. App. 3d 235, 632 N.E.2d 697, 198 Ill. Dec. 367 (2d Dist. 1994); American Family Ins. Co. v. Village Pontiac GMC Inc., 223 Ill. App. 3d 624, 585 N.E.2d 1115, 166 Ill. Dec. 93 (2d Dist. 1992); Graves v. Daley, 172 Ill. App. 3d 35, 526 N.E.2d 679, 122 Ill. Dec. 420 (3d Dist. 1988); State Farm Fire & Casualty v. Frigidaire, 146 F.R.D. 160 (N.D. Ill. 1992). Furthermore, sanctions may be imposed "despite the absence of a court order barring destruction." Village Pontiac, 585 N.E.2d at 1118. As a result of these cases it is a substantive requirement of each potential litigant in Illinois to preserve the integrity of material evidence. This duty is one of reasonableness and "in determining unreasonable noncompliance, a court may focus on the importance of the information a party is seeking to have produced." Id. Even if noncompliance was shown, sanctions are not appropriate, however, unless the movant can establish prejudice by his inability to examine the spoliated evidence. H & H Sand & Gravel, 632 N.E.2d at 704-05.
If a litigant's conduct is sanctionable, the trial court must also determine what the appropriate sanction should be. H & H Sand & Gravel Haulers, 632 N.E.2d at 701. In this analysis "a court must consider the conduct that gave rise to the sanctions [motion] and the effect of that conduct on the parties." Id. The Second District Appellate Court of Illinois has suggested various factors that should influence a court's determination as to what sanction to impose. These factors include the good faith of the parties, the surprise and prejudicial effect of the evidence, and the diligence of the parties. Id. at 701-02. Finally, all courts recognize that "courts should be reluctant to grant the extreme sanction of barring evidence when that ruling effectively resolves the case against the proponent of the evidence." Shelbyville Mut., 634 N.E.2d at 1324.
With these principles in mind, we now turn to defendants' claim that because Thomas sent the engine back to Decker Aero to be repaired and sent the Prairie Hawk to the scrap yard, he has failed to preserve the material evidence in this case. We will examine the two pieces of evidence, the engine and the plane, separately.
First, we decline to exercise our discretion to bar evidence relating to the engine. The issue presented by the repair of the engine is one of first impression in Illinois. Since it is uncontroverted that Decker Aero was the party who actually repaired the engine (and thus altered it from its post-accident condition), defendants are seeking to bar evidence that was spoliated when they controlled the evidence. Defendants fail to cite a single Illinois case in which the trial court barred a plaintiff's evidence that the defendant spoliated. Rather, the courts note that the plaintiff had exclusive control over the material ...