Court: Hawaii Intermediate Court of Appeals; October 15, 1980; Hawaii; State Appellate Court
An appeal was filed by Robert W. Hall against American Airlines after a directed verdict was granted at the close of Hall's case. The issue at hand is whether the airline is liable for damages when a fare-paying passenger identifies an unsafe condition aboard the aircraft during a stopover, reports it, but the airline chooses not to rectify the issue, leaving the passenger to either continue with the unsafe situation or exit the flight. Hall, an experienced pilot, discovered improperly stowed cargo in passenger seats during a stopover in Dallas. He concluded that the unsecured cargo posed a risk to passengers and reported it to the flight crew, who took no action. Consequently, Hall opted to disembark, spending the night in Dallas and later flying with another airline. His complaints prompted an FAA inspection, which confirmed the cargo was improperly secured, leading to a fine for American Airlines that was partially settled without admission of liability. Hall sought general and punitive damages for emotional distress but did not present evidence of additional expenses incurred. The court directed a verdict for the airline, but the appellate court found that there was enough evidence for a jury to potentially rule in Hall's favor, including the existence of a contract of carriage and the airline's failure to address the reported unsafe condition.
Evidence indicates that instead of remedying an unsafe condition, the appellee offered the appellant the option to either continue flying on an unsafe airplane or disembark. This constitutes a breach of the implied contract of common carriage, which mandates that the vehicle used must be safe. The court asserts that a carrier cannot impose such a choice on a passenger once the carriage has begun, and damages for this breach are recoverable. Citing Ferreira v. Honolulu Star-Bulletin, the court holds that if evidence of breach exists, the jury should determine whether to award nominal damages, regardless of the sufficiency of evidence for actual damages. There was also sufficient evidence for a jury to infer wanton or willful conduct regarding emotional distress damages.
The appellee argues Texas law applies, which allegedly prohibits such damages without physical injury; however, the court is uncertain about this interpretation and whether Texas law governs the case. The origin of the contract of carriage is unclear, but the flight began in New York, suggesting that New York law on allowable damages may apply. The record lacks clarity on this legal issue, and no opportunity was provided for the lower court to address the governing law.
Given the complexities of the conflict of laws and the appellant's stated intent to focus on principle rather than damages, the court reverses the lower court's judgment and remands for a new trial. Alternatively, the appellee may consent to a judgment of One Dollar plus costs for the appellant within ten days. Following a motion for reconsideration, the court reviewed the argument tape and confirmed its prior decision.
Appellant's counsel indicated that the client would accept nominal damages if punitive damages were deemed inappropriate. The court reiterated that punitive damages are only recoverable for willful, wanton, or malicious acts, a standard that has not been met by the appellee's employees based on the record. This aligns with established case law in Hawaii, noting that no differing standards exist in other applicable jurisdictions. The court found the record insufficient for determining damages or resolving conflict-of-laws issues regarding the contract in question. During oral arguments, both parties agreed to accept a judgment for nominal damages, providing a resolution without necessitating a retrial. The court reaffirmed this decision and denied the Motion for Reconsideration without further discussion.
