Richard Nairn v. National Railroad Passenger Corporation

Citations: 837 F.2d 565; 97 A.L.R. Fed. 177; 1988 U.S. App. LEXIS 633; 1988 WL 3689Docket: 182

Court: Court of Appeals for the Second Circuit; January 19, 1988; Federal Appellate Court

SummaryOriginalCytator Case TreatmentBackward CitatorAnalysis

EnglishEspañolSimplified EnglishEspañol Fácil

The National Railroad Passenger Corporation (the Railroad) appeals a decision from the U.S. District Court for the District of Connecticut that denied its request for a new trial based on the claim that the jury's verdict was excessive. The plaintiff, Richard Nairn, sustained a permanent back injury while working as a construction foreman due to the Railroad's alleged negligence, resulting in a jury award of $765,000. Upon review, the appellate court determined that the verdict was excessive as a matter of law, leading to the judgment being vacated and the case remanded for a new trial limited to the issue of damages.

At the time of his injury on December 26, 1984, Nairn was 33 years old and had four children. He injured his back while lifting heavy equipment embedded in ice. After initially continuing to work, he sought medical attention when pain persisted. Various tests, including x-rays and a CAT scan, yielded normal results. Nairn was later diagnosed with a musculoligamentous strain and advised to return to work, which he did until he re-injured himself in June 1985. An MRI revealed mild disc degeneration, and by fall 1985, Nairn was informed of a permanent partial disability with a 15% impairment rating.

Following the determination of his permanent disability, Nairn pursued a Federal Employers' Liability Act (FELA) claim in October 1985, seeking $1 million in damages. He consulted multiple medical specialists, with one confirming the permanent impairment and suggesting employment limitations.

In February 1986, Nairn accepted a general maintenance position at an apartment complex as an independent contractor, working 32-40 hours weekly at $10.25 per hour, without benefits. Prior to this, he earned $11.85 per hour with excellent benefits while employed by the Railroad. Following a trip and fall incident, Dr. Taub advised him to limit his work to light duty, which aligned with his new job responsibilities. Nairn's lawsuit against the Railroad was tried from February 10-13, 1987, where medical experts provided conflicting assessments of his functional impairment: Dr. Taub indicated a greater impact on Nairn's health, while Dr. Goodman assessed only a 5% impairment. Witnesses, including Nairn, testified about the injury and its aftermath. The jury found the Railroad negligent and awarded Nairn $765,000. The Railroad's motion for a new trial, citing the verdict's excessiveness, was denied by Judge Eginton. 

On appeal, the Railroad contested only the verdict's amount. The appellate court noted that overturning a jury verdict for excessiveness requires demonstrating an abuse of discretion, and that a court may only order a new trial if the verdict is irrational or shocks the conscience. The court emphasized the need for a detailed evaluation of the damages evidence. Nairn's damages included lost income and pain and suffering, excluding medical expenses which the Railroad had covered. It was stipulated that the after-tax value of Nairn's Railroad position, including benefits, was approximately $32,277 annually, and he had $16,922 in lost wages before starting at the apartment complex, where his pay started at $8.50 and later increased to $10.25. Nairn expressed concerns about future wage increases but provided no supporting evidence. He did not seek comparable employment with benefits and initially worked limited hours, later increasing to a full schedule.

Nairn's average weekly income is calculated at approximately $337, leading to an estimated after-tax annual income of $16,300 from his apartment complex job, which is about $15,980 less than his previous Railroad job. He did not present expert testimony on his future lost earnings, nor did his counsel provide specific figures to the jury. The jury was instructed to use a 2% discount rate for its award. If they accepted Nairn's income estimate and a work-life expectancy of 26.5 years, the total for lost earnings would likely not exceed $350,000, leaving around $400,000 for pain and suffering.

Medical experts confirmed that Nairn suffered a lumbosacral strain with a maximum 15% impairment of back function. He had not been hospitalized or undergone surgery beyond an initial emergency room visit. Despite ongoing pain, his work capacity improved significantly in the year prior to trial, although he was restricted to light-duty work and could not sit for long periods.

Nairn and his wife testified that he enjoyed various athletic activities and engaging with his children before the injury. Post-injury, he could not participate in sports or perform household tasks, leading to a strained relationship with his family and feelings of depression. The degenerative disc condition is deemed incurable, with a prognosis of ongoing treatment expected for the next five to ten years.

To assess whether an award is excessive, courts often compare similar cases. Two relevant Third Circuit cases are highlighted: In Gumbs v. Pueblo International, the court found a $575,000 award excessive for a plaintiff with similar limitations and ordered a new trial unless damages were reduced to $235,000. In Williams v. Martin Marietta Alumina, a plaintiff with a less severe injury had a jury verdict of $600,000 deemed excessive, mandating a new trial unless pain and suffering damages were reduced to $100,000.

In Harper v. Zapata Off-Shore Co., a seaman named Harper sustained a severe back injury, necessitating two surgeries for ruptured discs and resulting in ongoing pain and functional impairment. The jury awarded Harper at least $485,000 for pain and suffering, which the Fifth Circuit deemed excessive, ordering a new trial unless Harper reduced the award by $200,000. Other cases cited include Borough v. Duluth Missabe, Iron Range Ry. Co., with a $309,024 award for a back injury, and Hintz v. Jamison, which received $250,000 for a back injury that caused neurological issues. The Third Circuit in Gumbs noted increasing appellate scrutiny of damage awards, reflecting concerns over excessive jury awards influenced by sympathy rather than factual analysis. Evaluating the case at hand, the court found Nairn's $400,000 award for pain and suffering excessive given a 15% functional impairment, leading to a judgment vacate and remand for a new damages trial.

Circuit Judge Kearse dissented, acknowledging the disparity between Nairn's award and other similar cases but arguing that the majority's assumptions on the breakdown of the award were unverifiable. Kearse suggested that if the jury followed the trial court's instructions regarding lost earnings and the discount rate, their calculations could justify a higher award, potentially leaving $400,000 for pain and suffering without fully accounting for the jury's discretion or favorable evidence for Nairn.

The trial court did not mandate that jurors assume Nairn would only work for an additional 26.5 years until the age of 61.5, but rather presented this figure as a statistical average while encouraging jurors to consider all evidence regarding his probable work life. Given Nairn's excellent physical condition before his injury, jurors could reasonably conclude he might work longer, resulting in greater lost future earnings. Additionally, the court characterized the 2% discount rate as a guideline rather than a requirement, allowing jurors to use their judgment in assessing an appropriate rate, which could be as low as 1.5%, potentially increasing the future earnings award significantly. Furthermore, the court's instructions did not compel the jury to assume Nairn would remain at his last salary for his entire career. Testimony indicated Nairn’s intention to make a long-term career at the Railroad, his history of wage increases, and his promotion, supporting the jury's potential finding that he would likely have continued to receive raises had he not been injured. This aligns with precedent allowing consideration of past wage trends to predict future earnings.

Three key variables were identified that the majority assumed the jury had to adopt: retirement age of 61.5, a 2% discount rate, and a stagnant salary. Adjusting any of these variables within reasonable limits, consistent with trial court instructions and evidence, could lead to significantly higher economic loss figures than the $350,000 estimated by the majority. For instance, if the jury considered a 26.5-year work-life expectancy and a 2% discount rate while assuming modest salary increases of 2-3% annually, the economic loss could be calculated at $479,000. If the jury assumed Nairn would work until age 65 with similar salary increases, the loss could be $531,000, and using a 1.5% discount rate with the same retirement assumption could yield $573,000. The jury's overall award of $765,000 could therefore be supported within the permissible ranges for economic loss and pain and suffering. According to the Seventh Amendment, the jury's award must be upheld if there is a reasonable basis for it. Given the potential justifications for the jury's findings, it cannot be concluded that the district court abused its discretion by not overturning the verdict for being excessive. The judgment should be affirmed.