Ruth Culver, Cross-Appellees v. Slater Boat Co., Cross Europirates International, Inc., and Cross- Appellees-Appellants v. Odeco Drilling, Cross

TJOFLAT, Circuit Judge,

dissenting:

Appellants ask this court to abrogate the rule of Starnes & Johnson v. Penrod Drilling Company, 510 F.2d 234, 241 (5th Cir. 1975) (en banc) that “the influence on future damages of possible inflation or deflation is too speculative a matter for judicial determination.” Because appellants, in their case in chief, failed to proffer competent, admissible evidence of the impact of inflation on lost, future wages and because a jury cannot consider this issue without such evidence, appellants cannot benefit from a holding of this court overturning the decision in Penrod. Appellants are not entitled to the new trial on damages the majority prescribes, and therefore I must respectfully dissent.

I.

In Penrod Drilling Company , this court— in the face of competent expert testimony from two economists on the issue of inflation — adopted a rule that excluded any evidence or jury instructions concerning the impact of inflation on damage awards because “we still cannot so surely discern the shadow of inflation as a coming event to warrant requiring its inclusion in a present rule for calculating future damages.” Pen-rod, supra, 510 F.2d at 236 . Thus, regardless of the qualifications of an expert or the basis for his testimony, we proscribed any effort to factor in the impact of inflation on recoveries for future losses. As Judge Brown points out for the majority, the “Penrod rule” as subsequently interpreted by this circuit has amounted to a “flat prohibit[ion] [of] any consideration of inflation.” Majority Opinion, at 290.

In this case, the appellants sought, and .were refused, a jury instruction concerning the impact of inflation on damages awards. Record, vol. 4, at 865, 867-68. On appeal, they urge us to change the Penrod rule barring such an instruction and to hold that competent evidence of inflation may be considered by a fact-finder in calculating lost earnings. However, appellants established no foundation whatsoever in the record for such an instruction. Indeed, they did not proffer or even attempt to proffer a scintilla of evidence in their case in chief concerning inflation; for strategic reasons they did not want the jury to hear such evidence. They now have the audacity to claim in their brief to the court en banc that the trial judge “would not permit any proof, or even a bill or a proffer of proof (sic) concerning inflation or deflation, or the rapidly decreasing value of a dollar. He would not permit it for the record, for proof on this appeal, or for any other purpose.” Plaintiffs-Appellants Post-Submission Brief at 5. The record reveals that this claim is false. The Penrod issue is therefore not before us.

II.

The district court held a pretrial conference in this case and entered a comprehensive pretrial order which set forth, among other things, contested issues of fact and law. Nowhere in that order is there any indication that the plaintiffs wanted the jury to consider inflation in calculating damages. Record, vol. 2, at 333-49.

Although the plaintiffs listed “Dr. Seymour Goodman,” an economist, as a potential witness, they did not indicate that his testimony would bear on inflation. Id. at 346 . In fact, Dr. Goodman was not called, and plaintiffs called no witness to testify on inflation. Plaintiffs made no proffer of any kind on inflation during their ease in chief. Their claim that the trial judge would not permit them to do so is therefore *316 unfounded. This is made clear by a colloquy that occurred between the court and counsel during the plaintiffs’ cross-examination of a defense expert witness, Hattier. It was during the cross-examination of Hat-tier that plaintiffs first attempted to inject inflation into the case. Record, vol. 7, at 745-48.

By plaintiffs’ admission, their choice not to call their expert, Goodman, during their case in chief was purely tactical: “The reason that the Culvers did not call their ‘expert’ actuary was to avoid putting the high discount rate before the jury. ...” Plaintiffs-Appellants Post-Submission Brief at 5. Thus, plaintiffs deliberately did not make a proffer concerning inflation.

The defense called Hattier as a bond expert for the sole and narrow purpose of establishing an appropriate discount rate in accordance with Chesapeake & Ohio Railway v. Kelly, 241 U.S. 485 , 36 S.Ct. 630 , 60 L.Ed. 1117 (1916). When counsel for plaintiffs attempted to ask Hattier on cross-examination about “inflationary trends” and the value of the principal of a thirty-year government bond at maturity, the court sustained a general objection from defendants. Record, vol. 7, at 742.

Shortly thereafter, plaintiffs’ counsel approached the bench and sought to proffer the testimony he thought Hattier could give concerning inflation, a subject upon which he did not testify on direct nor for which he had been qualified by counsel. The court properly resisted plaintiffs’ attempt to make defendants’ expert its own:

Make whatever proffer you want. Let me tell you this. In the first place, you just make your proffer, make your statement here, but let me tell you this is excludable because he didn’t go into this on his direct examination. It is improper cross-examination. You rested your case and you can’t bring this witness back as part of your case in chief. You offered no evidence on that in the case in chief.

Record, vol. 7, at 745. Plaintiffs’ counsel then stated that he wished to ask Hattier about inflationary trends, the impact of inflation on bonds and other investments, etc. Record, vol. 7, at 746-48. Counsel offered no proof that Hattier would so testify, or, more fundamentally, that he was qualified to give such expert opinion testimony under the Federal Rules of Evidence. See Fed. R. Evid. 702.

At the conclusion of this brief proffer, the trial judge made it clear that such evidence would not be admitted for two, independent reasons: “you can’t use the cross-examination of this witness as part of your case in chief,” Record, vol. 7, at 747, and “I will not permit you to introduce any evidence before the jury relative to inflation in view of the present law that I am bound by which is the Penrod case.” Record, vol. 7, at 748.. It was “[f]or those two reasons [that] the attempt to elicit that testimony in the presence of the jury is denied.” Record, vol. 7, at 747.

The trial then ended without further testimony and without any attempt by plaintiffs to reopen their case to introduce inflation testimony. The issue of lost future earnings was thus presented to the jury on evidence concerning the life and work expectancies of plaintiffs’ decedent, and the hourly wage for a superintendent of pushers of an anchor pulling crew, the decedent’s job at the time of his death. There-was no evidence concerning the effect of. inflation on future earnings. A charge conference preceded counsel’s closing arguments to the jury. The record is unclear as to whether plaintiffs sought a jury instruction allowing the jury to take inflation into account in their damages award, but I assume one was requested because the court told counsel that it could not argue inflation to the jury. Record, vol. 8, at 764-65.

The net effect of plaintiffs’ trial strategy was that a party which made a tactical decision not to offer evidence on inflation nonetheless sought an inflation instruction asking the jury, I suppose, to call upon its genius, general knowledge and previous information to arrive at the inflation component of its damages award. The district court properly refused such an instruction. The refusal of the court to give it is the only error the appellants now present to this en banc court.

*317 III.

Whatever may be said about Penrod and the merits of the rule concerning inflation, one thing is clear: juries cannot be left in the wilderness to speculate about the future effects of inflation on lost wages where the record contains no evidence on that subject. To reach this conclusion we need not decide whether in a case that presents competent, probative evidence of inflation, Penrod should be overruled, thus permitting the jury to consider such evidence in calculating prospective wage losses.

The majority attempts to excuse the failure of appellants to preserve the Penrod issue by stating: “Given this flat prohibition against introducing testimony (or making argument) as to future inflationary trends on the basis of Penrod, it makes no sense to argue that Culver may not raise this issue on appeal simply because he (sic) did not proffer an expert on inflation.” Majority Opinion, at 285. (Emphasis added.) This implicitly acknowledges the appellants’ failure to take the necessary steps to preserve an issue for appeal, see Fed. R. Civ. P. 46, but asserts that because the trial court prevented Culver from making a record we must overlook this failure.

- The majority’s statement that the trial court prevented plaintiffs from “introducing testimony” is simply incorrect. As I have pointed out, the plaintiffs, for purely tactical reasons, rested their ease without even attempting to introduce inflation evidence. They made no attempt to preserve the Penrod issue for appeal. All they preserved for the Court of Appeals is the right to a jury instruction on the impact of inflation on future wages in a case where they deliberately refrained from introducing evidence on inflation. Such an instruction without any record evidence regarding inflation would invite the lawyers in closing argument to call upon the jury simply to invent an inflation figure out of thin air. I cannot countenance this result.

What the majority forgets — in its haste to reach the Penrod issue and change our rule concerning inflation — is the responsibility of this court to do justice for the litigants in the case before it. No one needs to be reminded that “The judicial power shall extend to all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made, or which shall be made, under their Authority”; U.S. Const, art. Ill, § 2. The requirement of a “case or controversy” pri- or to the exercise of the judicial power is designed precisely to prevent what has occurred here: abstract judicial law-making in the absence of facts and parties with a dispute requiring its exercise. Here, the Penrod issue is not properly before us, and to raise it without a proper foundation is both to run roughshod over the constitutional restraints on our power and to require the defendants to submit to the retrial of an issue properly laid to rest in the district court.

The district court acted well within its discretion in preventing the plaintiffs from making a defense expert their own witness on cross-examination, see Fed. R. Evid. 611(b), and it correctly denied a requested jury instruction that was plainly erroneous.

I would affirm the judgment of the district court.