Denman Ex Rel. Denman v. Snapper Division

United States Court of Appeals,

Fifth Circuit.

No. 97-60301.

Hunter W.P. DENMAN, a minor by and through W.T. DENMAN, Jr., Next
Friend, Plaintiff-Appellant,

v.

SNAPPER DIVISION; Actava Group, Inc.; Jim Andrews, doing
business as McComb Appliance & Equipment and/or Andrews Firestone;
Andrews Firestone, Andrews Firestone, Inc., Defendants-Appellees.

Jan. 6, 1998.

Appeal from the United States District Court for the Southern
District of Mississippi.

Before WIENER, EMILIO M. GARZA and BENAVIDES, Circuit Judges.

BENAVIDES, Circuit Judge:

Plaintiff Hunter W.P. Denman ("Hunter") appeals the district

court's summary judgment that North Carolina's products liability

statute of repose bars his claims. We AFFIRM.

I.

On April 21, 1987, Hunter, a minor, severed his left foot

while mowing a lawn with his grandfather's Snapper riding

lawnmower. Although his foot was surgically replaced, he has not

regained its full use. Hunter alleges that the mower was defective

because it was not equipped with a deadman's switch or another

safety device that might have prevented his injury and because it

was accompanied by inadequate warnings.

Hunter's grandfather, W.T. Denman ("Denman"), a Mississippi

resident, purchased the mower in 1980 from Jim Andrews d/b/a McComb

Appliances and Equipment and/or Andrews Firestone or Andrews

1
Firestone, Inc. (collectively "Andrews") in Mississippi. The mower

was manufactured in Georgia by Snapper Division of The Actava

Group, Inc. ("Snapper"), a Delaware corporation with its principal

place of business in Georgia. Denman loaned the mower to his son,

Hunter's father, who at that time lived in North Carolina with

Hunter. The accident occurred in North Carolina. Hunter has since

moved to New Hampshire with his mother; his father continues to

reside in North Carolina.

On May 10, 1996, Denman, the guardian of Hunter's estate,

brought suit on Hunter's behalf in Mississippi state court,

asserting products liability and negligence claims against Andrews,

Snapper, and The Actava Group's successor corporation Multimedia

International Group, Inc. Defendants removed the suit to federal

district court. Hunter moved to remand on the sole ground that the

district court lacked jurisdiction because one of the defendants

was a non-diverse party. The district court concluded that there

was complete diversity of citizenship between the parties and

denied the motion to remand. The district court declined to

address whether removal was improper because Andrews was an

in-state defendant, concluding that the plaintiff had waived this

objection by failing to raise it.

The district court granted summary judgment to defendants on

the ground that Hunter's claim was barred by North Carolina's

six-year statute of repose, which governs all tort claims arising

from the use of an allegedly defective product. See N.C.GEN.STAT.

§ 99B-1(3) (1993). Hunter contends on appeal, as below, that

2
Mississippi law should govern his claim.

II.

We turn first to Hunter's claim that the district court

should have remanded this suit to Mississippi state court. Hunter

moved to remand on the ground that the district court lacked

jurisdiction because of the presence of a non-diverse defendant.

Contrary to Hunter's assertion, however, there was complete

diversity of citizenship between the parties: Hunter was a

resident of New Hampshire at the time he filed suit;1 the

defendants were residents of Mississippi, Georgia, or Delaware.

See 28 U.S.C. § 1332. Hunter should have objected instead that the

presence of Andrews, a resident of Mississippi, violated the

statutory prohibition on the removal of diversity suits if any

defendant is a citizen of the state in which the action was

brought. 28 U.S.C. § 1441(b). Under the law of this circuit,

however, the presence of an in-state defendant is a procedural

defect that is waived unless raised within thirty days of removal.

28 U.S.C. § 1447(c); In re Shell Oil Co., 932 F.2d 1518, 1521,

1523 (5th Cir.1991); see also Williams v. AC Spark Plugs Div. of

GM Corp., 985 F.2d 783, 786 (5th Cir.1993); In re Digicon Marine,

Inc., 966 F.2d 158, 160 (5th Cir.1992) (both explaining that any

defects other than lack of subject matter jurisdiction are waivable

procedural defects).

1
For the purposes of determining whether diversity of
citizenship existed, the citizenship of Denman, Hunter's guardian,
was not relevant. 28 U.S.C. § 1332(c)(2) ("the legal
representative of an infant ... shall be deemed to be a citizen
only of the same State as the infant....").

3
 In short, Hunter failed to make the proper objection to

removal.2 Had Hunter moved to remand on the ground that removal

was improper because Andrews was an in-state defendant, remand

would have been required. Because he did not, the district court

did not err in denying the motion to remand.

III.

We next address Hunter's argument that the district court

erred in holding that North Carolina's six-year statute of repose

for products liability claims bars Hunter's claims. He contends

that the district court should have instead applied Mississippi's

statute of limitations.

We review the district court's conflict-of-law determination

de novo. Allison v. ITE Imperial Corp., 928 F.2d 137, 138 (5th

Cir.1991). It is well established that in diversity cases, a

federal court must apply the conflict-of-law rules of the state in

which it sits. Klaxon v. Stentor Elec. Mfg. Co., 313 U.S. 487,

496, 61 S.Ct. 1020, 1021-22, 85 L.Ed. 1477 (1941); Allison, 928

F.2d at 138; Mitchell v. Lone Star Ammunition, Inc., 913 F.2d 242,

249 (5th Cir.1990).3

Mississippi follows the "most significant relationship" or

"center of gravity" test for determining the applicable law. See

2
Hunter's argument in the district court that, contrary to the
defendants' assertions in their notice of removal, the Mississippi
defendants were not "fraudulently joined" was insufficient to
preserve his objection based on the in-state defendant rule.
3
To the extent that Hunter argues that this court should apply
North Carolina conflict-of-law principles, he is clearly incorrect.

4
McDaniel v. Ritter, 556 So.2d 303, 310 (Miss.1989) (en banc);

Mitchell v. Craft, 211 So.2d 509, 515 (Miss.1968) (adopting the

most significant relationship test as set out in the then-official

draft of the Restatement (Second) of Conflict of Laws); see

RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145(1) (1980) ("The rights and

liabilities of the parties with respect to an issue in tort are

determined by the local law of the state which, with respect to

that issue, has the most significant relationship to the occurrence

and the parties under the principles stated in § 6."). Under

Mississippi law, the substantive law of the place of injury

controls unless another state has a more significant relationship

to the occurrence and the parties. Allison, 928 F.2d at 141-42 &

n. 4.4

Under the Restatement approach adopted by Mississippi, the

court examines the contacts of the relevant states, as set forth in

§ 145, in light of the policy considerations in § 6. See Mitchell,

913 F.2d at 249.5 The Mississippi Supreme Court has noted that

4
North Carolina's products liability statute of repose is
substantive rather than procedural. See Bonti v. Ford Motor Co.,
898 F.Supp. 391, 397 (S.D.Miss.1995), aff'd, 85 F.3d 625 (5th
Cir.1996); Crouch v. General Elec. Co., 699 F.Supp. 585, 590-91
(S.D.Miss.1988); Siroonian v. Textron, Inc., 844 F.2d 289 (5th
Cir.1988) ("Mississippi honors the construction of a statute placed
on it by the courts of the state whose legislature enacted it.")
(citations omitted). If the statute were procedural, Mississippi
would not be bound to apply it. See Allison, 928 F.2d at 144.
5
Section 6 sets forth the following factors:

(a) the needs of the interstate and international
systems,

(b) the relevant policies of the forum,

5
"The principles of Sections 6 and 145 of the Restatement (Second)

defy mechanical application-they are less "rules of law' than

generally-stated guideposts." McDaniel, 556 So.2d at 310, quoted

in Gann v. Fruehauf Corp., 52 F.3d 1320, 1325 (5th Cir.1995). The

contacts taken into consideration under § 145 are: (a) the place

where the injury occurred; (b) the place where the conduct causing

the injury occurred; (c) the domicile, residence, nationality,

place of incorporation, and place of business of the parties; and

(d) the place where the relationship, if any, between the parties

is centered. RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145. In this

case, the parties agree that the law of either Mississippi or North

Carolina controls.

The injury occurred in North Carolina. In some cases, such

those involving an automobile accident in which the parties are not

residents of the state where the accident occurred, the location of

the injury is discounted as merely fortuitous. See, e.g.,

Mitchell, 211 So.2d at 513. As the district court correctly

(c) the relevant policies of other interested states and
the relative interests of those states in the
determination of the particular issue,

(d) the protection of justified expectations,

(e) the basic policies underlying the particular field of
law,

(f) certainty, predictability and uniformity of result,
and

(g) ease in the determination and application of the law
to be applied.

RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 6.

6
explained, this is not such a case. See Allison, 928 F.2d at 143.

Hunter was not passing through North Carolina, but actually resided

there at the time of the injury.

Hunter's residency in North Carolina at the time of the

accident is also a relevant contact under § 145(2)(c), which

directs the consideration of "the domicile, residence, nationality,

place of incorporation and place of business of the parties."

RESTATEMENT (SECOND) OF CONFLICT OF LAWS § 145(2)(c). Defendant Andrews,

on the other hand, is a resident of Mississippi.6

The other two § 145 factors also shed little light on what law

should be applied. Although the parties agree that under §

145(2)(b), the conduct giving rise to the injury took place in

Georgia because the product was manufactured there, no party argues

that Georgia law should be applied. Nor does § 145(2)(d), the

place where the relationship between the parties is centered, aid

our inquiry. See Allison, 928 F.2d at 142. Although the product

was sold in Mississippi by a Mississippi defendant to a Mississippi

resident, the parties to this litigation (i.e., Hunter and the

defendants) had no pre-existing relationship. Thus, the place

where the relationship between the parties, if any, is centered is

duplicative of the place of injury. See Allison, 928 F.2d at 142

n. 5.

6
Denman, the guardian of Hunter's estate and the purchaser of
the mower, is also a Mississippi resident. Because Denman is not
a party to this litigation, however, his residency is not relevant
to our analysis. Cf. 28 U.S.C. § 1332(c)(2) (providing that the
residency of the legal guardian of an infant is not relevant to
determining citizenship for diversity purposes).

7
 On two previous occasions, we have addressed the application

of the Restatement factors in products liability cases where the

issue was which state's statute of repose or limitation should be

applied. See Allison, 928 F.2d at 138-44; Mitchell, 913 F.2d at

249-50. Although both decisions inform our decision in this case,

neither is dispositive.

In Allison v. ITE Imperial Corp., we applied Mississippi

conflict-of-law rules to determine whether Tennessee or Mississippi

law applied. 928 F.2d at 138-44. In that case, James Allison, a

Mississippi resident, was injured on the job in Tennessee by a

circuit breaker manufactured in Pennsylvania by a Delaware

corporation with its principal place of business in Pennsylvania

corporation. Id at 138. The court concluded that Allison's claims

were barred by Tennessee's statute of repose. Id. at 144. We

emphasized that under Mississippi's conflict-of-law rules, the law

of the state where the injury occurs controls unless another state

is shown to have a more significant relationship to the occurrence

and parties. Id. at 141-42 & n. 4.

In Mitchell v. Lone Star Ammunition, the court considered

whether Texas or North Carolina law applied to the plaintiffs'

products liability claims. 913 F.2d at 249. The claims in

Mitchell arose out of an accident that occurred in North Carolina

when a defective mortar shell that was manufactured and distributed

in Texas exploded prematurely. Id. Applying Texas conflict-of-law

principles, we held that Texas law applied. Id at 250. We

explained that because the defendants were not from North Carolina,

8
there was "[n]o compelling reason ... why the North Carolina

legislature would have an interest in the application of its

statute of repose to eliminate the claims of foreign plaintiffs

against foreign defendants." Id. at 250. Conversely, we found

that Texas had a substantial interest in the resolution of the

dispute, an interest that was "particularly strong when the

defective product in question was manufactured and placed in the

stream of commerce in the State of Texas." Id. (citation omitted).

Balancing these interests, we concluded that the law of the State

of Texas should apply. Id.

Although this case is similar to Mitchell, it also differs in

three crucial respects. First, Mitchell involved a product that

was manufactured, in part, in Texas, 913 F.2d at 249; here,

although the mower was sold in Mississippi, it was manufactured in

Georgia. Second, the plaintiffs in the Mitchell case were not

residents of state where the injury occurred, id.; in this case,

Hunter was a North Carolina resident as the time of the accident.

Third, and perhaps most importantly, in Mississippi, unlike Texas,

the law of the place of injury is presumed to apply unless another

state has a more significant relationship. Compare Allison, 928

F.2d at 141-42 & n. 4, with Baird v. Bell Helicopter Textron, Inc.,

491 F.Supp. 1129, 1139 (N.D.Tex.1980) (noting that under Texas law

the location of the injury is merely a factor to be considered when

determining the applicable law). Consequently, under the

Restatement factors, Texas had a more significant relationship with

the parties and occurrence than Mississippi has in this case.

9
 In light of Mississippi law, the Restatement, and precedent of

this court, we conclude that the sale of the mower in Mississippi

by a Mississippi defendant provides an insufficient basis for

finding that Mississippi has a more significant relationship than

North Carolina. Simply put, Mississippi would have very little

interest in applying its law to litigation arising out of an

accident in North Carolina involving a resident of North Carolina

and caused by a product manufactured in Georgia. Under the

circumstances of this case, the fact that the mower entered the

stream of commerce in Mississippi does not tip the balance in favor

of applying Mississippi law when the Mississippi choice-of-law

rules counsel that the law of the state of injury controls unless

another state has a more significant relationship.

IV.

For these reasons, we AFFIRM the judgment of the district

court.

10