22 Cal. 3d 157, 148 Cal. Rptr. 867, 583 P.2d 721 (1978)
Offshore Rental Company is a California corporation with its principal place of business in California.1 It derives its revenues in large part from leasing oil drilling equipment in Louisiana's Gulf Coast area.2 Continental Oil Company is a Delaware corporation headquartered in New York.3 It does business in California, Louisiana, and other states.4
In November 1967, Offshore opened an office in Houston, Texas, to establish a base closer to the Gulf Coast.5 In June 1968, Offshore's vice-president Howard C. Kaylor traveled from that office to Louisiana to confer with Continental's representatives.6 During that trip, Continental negligently injured Kaylor on its premises in Louisiana.7 At the time, Kaylor was responsible for obtaining contracts for Offshore's increased business in Louisiana.8
Continental compensated Kaylor for his injuries.9 Offshore then filed suit in California seeking $5 million in damages for the loss of Kaylor's services.10 In a bifurcated trial on choice of law, the trial court found that all significant contacts were in Louisiana except for Offshore's California residency.11 The court determined that Louisiana law governed whether a corporation could maintain an action for damages from personal injuries to its employee.12 Finding that Louisiana law barred the action, the court entered judgment for Continental.13 Offshore appealed from the judgment.14
Whether California law or Louisiana law governs the plaintiff's claim for damages arising from negligent injury to its vice president in Louisiana?15
Under the governmental interest analysis, when the laws of California and Louisiana conflict on whether a corporation may maintain an action for loss of services of a key employee, the court first identifies a true conflict.16 The court then resolves it by applying the law of the state whose interest would be more impaired if its policy were subordinated to the policy of the other state.17
Yes. The established facts show that Offshore Rental Company is a California corporation with its principal place of business in California.18 Continental Oil Company is a Delaware corporation that does business in Louisiana.19 The negligent injury to vice-president Kaylor occurred on Continental's premises in Louisiana.20 Louisiana law, as interpreted in Bonfanti Industries, Inc. v. Teke, Inc., refuses to recognize the corporate employer's cause of action to protect resident tortfeasors from excessive liability.21 California law, assuming it grants a cause of action under Civil Code section 49, seeks to protect California employers from economic harm regardless of the place of injury.22
Louisiana's interest is comparatively stronger because its policy is current and directly advances freedom of investment and enterprise within its borders.23 California's statute is archaic, isolated within the federal union, and infrequently applied even domestically.24 The availability of key-employee insurance further supports limiting the reach of California law to domestic occurrences.25
Louisiana law governs the plaintiff's claim.26
Whether the trial court properly dismissed the complaint after determining that all significant contacts existed in Louisiana?27
Although the trial court applied the incorrect most significant contacts theory rather than governmental interest analysis, the judgment of dismissal must be affirmed.28 This is because the correct comparative impairment analysis leads to the same conclusion that Louisiana law governs and provides no cause of action.29
Yes. The established facts establish that the trial court found all significant contacts operative in the case were in Louisiana except for the plaintiff's California residency, applied Louisiana law, and granted judgment for Continental because Louisiana does not permit the action.30 Under the proper governmental interest analysis the same result follows because Louisiana's interest in protecting its resident tortfeasor would be more impaired if California law were applied, so the dismissal of the complaint is correct.31
The trial court properly dismissed the complaint.32