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FENIELLO v. UNIVERSITY OF PENNSYLVANIA HOSP.

March 23, 1983

Remy FENIELLO and Anne Feniello, his wife, Plaintiffs,
v.
UNIVERSITY OF PENNSYLVANIA HOSPITAL, a corporation of the Commonwealth of Pennsylvania, Defendant



The opinion of the court was delivered by: COHEN

 This medical malpractice action is presently before this Court on defendant's motion for summary judgment, pursuant to Fed.R.Civ. 56, challenging the Court's jurisdiction over the matter.

 Plaintiffs, Remy and Anne Feniello, New Jersey residents, have instituted this action against the University of Pennsylvania Hospital (HUP), a Pennsylvania nonprofit institution, for damages for personal injuries suffered by Mr. Feniello allegedly as a result of the medical malpractice of the agents and employees of HUP. The hospital asserts that the New Jersey Charitable Immunity Act, N.J.Stat.Ann. §§ 2A:53A-7 and 8 (West Supp.1982) *fn1" applies to the instant action and limits plaintiffs' recovery against the hospital to $10,000.00. Since plaintiffs are unable to collect in excess of $10,000.00, HUP argues that the jurisdictional requirements of 28 U.S.C.A. § 1332(a) (West Supp.1982) *fn2" are not met. Oikarinen v. Alexian Brothers, 342 F.2d 155 (3d Cir.1965) (per curiam). Consequently, there exists no basis for jurisdiction in the federal courts.

 Plaintiffs maintain that the New Jersey Charitable Immunity Act applies only to New Jersey institutions and cannot limit the liability of a Pennsylvania hospital such as HUP. Moreover, plaintiffs contend that the instant motion is barred by the doctrine of collateral estoppel because the identical issue was decided against the defendant in Prince v. Trustees of University of Pennsylvania, 282 F. Supp. 832 (E.D.Pa. 1968).

 This Court has concluded, for the reasons set forth below, that although HUP is not barred by the doctrine of collateral estoppel from raising the instant motion, such motion must be denied.

 The Court applied Pennsylvania's conflict of law rules and held that because Pennsylvania had the greatest interest in the outcome of the suit, Pennsylvania law and not the law of New Jersey controlled. Id. at 836. In dicta, the Court added that even if New Jersey law was employed, the New Jersey Charitable Immunity Act could not be interpreted to extend protection to a Pennsylvania hospital. Id.

 
It cannot seriously be argued that the New Jersey statute was meant to limit recovery to one of its own domiciliaries from an out of state hospital having no real connection with New Jersey.
 
The New Jersey statute in question was obviously intended to protect New Jersey charities from verdicts in excess of $10,000.00. Although it is true that the statute speaks in terms of any charitable corporation, it is clear that New Jersey was only empowered to legislate with respect to New Jersey charities.

 Id. at 836-37.

 Plaintiff contends that the Court's finding in Prince that the New Jersey statute offered HUP no limitation on its liability collaterally estops HUP from raising that issue in this Court. Collateral estoppel has been defined as that branch of res judicata which bars relitigation of any issue which was actually determined in a prior action involving a different claim or cause of action. State v. Gonzalez, 75 N.J. 181, 186, 380 A.2d 1128, 1130 (1977). If a party is precluded from relitigating an issue with an opposing party, he is also precluded from doing so with another person unless the party lacked a full and fair opportunity to litigate the issue in the first action or unless other circumstances justify affording him the opportunity to relitigate the issue. United Rental Equip. Co. v. Aetna Life & Cas. Ins. Co., 74 N.J. 92, 101, 376 A.2d 1183, 1188 (1977). At least four elements must be satisfied before an order in a former action can be given collateral estoppel effect in a later proceeding: (1) the issue sought to be precluded must be the same as that involved in the prior action; (2) the issue must have been actually litigated; (3) it must have been determined by a valid and final judgment; and (4) the determination must have been essential to the prior judgment. Haize v. Hanover Ins. Co., 536 F.2d 576, 579 (3d Cir.1976).

 In Prince, the district court initially held that under Pennsylvania's conflict of law rules, the substantive law of that state applied to the action. 282 F. Supp. at 836. Any conflict of law question decided by this Court, however, must be analyzed under the New Jersey conflict of law rules. Klaxon Co. v. Stentor Co., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1941). Therefore, in terms of choice of law, the issue presented to this Court is necessarily different from the one decided in Prince.

 In addition, the Prince court only addressed the question of whether the New Jersey Charitable Immunity Act applied to HUP after finding that Pennsylvania law controlled. Since the latter determination was not essential to the ultimate judgment in Prince, it cannot now be asserted to preclude HUP from raising the issue of the statute's applicability in this proceeding.

 Unlike the District Court in Prince, this Court finds it unnecessary to resolve the conflict of law question because we hold that even assuming, for the purposes of this motion, that the substantive law of New Jersey controls the outcome of this litigation, the limitation on recovery against ...


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