007 - First National Bank in Fort Collins v. Rostek

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FIRST NATIONAL BANK IN FORT COLLINS v.

ROSTEK
512 P. 2d 314 (1974)

Doctrine: The rights and liabilities of the parties are governed by the law of the place of domicile.

Facts: The First National Bank in Fort Collins (petitioner herein), is the guardian of the natural children of Carol Hardin
Rostek. The respondent is the administratrix of the estate of John E. Rostek. Petitioner filed a wrongful death action in
Colorado district court alleging that negligent operation of the aircraft on the part of John E. Rostek caused the accident
and the ensuing death of his guest-passenger, Carol Hardin Rostek. The respondent filed a motion for summary
judgment alleging the rights of the parties are governed by the South Dakota Aircraft Guest Statute.

For purposes of the summary judgment motion the parties stipulated that at most the petitioner's evidence would show
simple negligence on the part of John Rostek. The parties also stipulated that John and Carol Rostek were both citizens
and residents of the state of Colorado, and that Carol Rostek's natural children, who are her sole heirs at law, resided
with her in Colorado.

The district court dismissed the case on the ground that lex loci delicti ( the law of the place of the wrong) or South
Dakota law, applied.

Issues: Whether South Dakota or Colorado law should be applied.

Held: Colorado law should be applied.


With the industrial revolution and the passage of time, it became clear that the mechanical application of lex loci delicti
to every multistate tort controversy often yield harsh, unjust results, unrelated to the controversy expectations of the
parties. A greater number of jurisdictions have abandoned or rejected lex loci delicti in favor of a more flexible and
rational choice of law approach in multistate tort cases.

A court in New York then proceeded to formulate a specific rule governing the application of guest statutes in multistate
tort controversies. This rule generally embodies the rational underpinnings of the newer approaches to choice of law
problems, emphasizing the expectations of the parties and the interests of the different jurisdictions involved. We are
persuaded that it is just and equitable and ought to be accepted in Colorado with respect to the first two sections thereof
and we now do so. As stated by the New York court, those sections provide:

"1. When the guest-passenger and the host-driver are domiciled in the same state, and the [vehicle] is there registered, the law of that state
should control and determine the standard of care which the host owes to his guest.
"2. When the driver's conduct occurred in the state of his domicile and that state does not cast him in liability for that conduct, he should
not be held liable by reason of the fact that liability would be imposed upon him under the tort law of the state of the victim's domicile.
Conversely, when the guest was injured in the state of his own domicile and its law permits recovery, the driver who has come into that
state should notin the absence of special circumstances be permitted to interpose the law of his state as a defense."

We must now apply the aforementioned choice of law rule to determine if the South Dakota guest statute should be
applied to the case at bar. Both the guest-passenger and the host-pilot were domiciled and residing in Colorado, and the
airplane was registered in Colorado. Thus, the facts in this case are governed by the first statement of the rule. Under
this statement, the rights and liabilities of the parties are governed by the law of the place of domicile which in this case
is Colorado. Moreover, the facts in the case at bar demonstrate the injustice and irrationality of the automatic application
of the lex loci delicti rule. South Dakota’s only interest in this controversy is the fortuitous occurrence of the accident
within its borders. Thus the trial court’s decision to apply South Dakota law to this case can be affirmed only if we are to
adhere to a mechanical and unfailing application of the place of wrong rule, regardless of the interest of the states
involved or the expectations of the parties. Accordingly, South Dakota law, including its Airplane Guest Statute, is not
the appropriate law to apply under this new rule.

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