The Supreme Court on Wednesday barred air travelers from using an international treaty to sue airlines for emotional distress suffered in near-crashes that cause passengers no physical harm.
The justices unanimously ruled that Eastern Airlines - now owned by Texas Air - cannot be forced to pay passengers aboard a flight that landed safely in Miami after all of the plane's engines failed for a time in the air.Justice Thurgood Marshall, writing for the court, said the Warsaw Convention international air travel treaty does not permit airlines to be sued in such cases by passengers who suffer only psychic trauma.
Wednesday's ruling applies only to international flights. The court did not address the issue of state court lawsuits for emotional distress by passengers on domestic flights.
In other action, the court:
- Said S&Ls and other financial institutions may claim tax deductions for "reciprocal sales" of mortgage loans. That 7-2 decision, a defeat for the Internal Revenue Service, will save S&Ls at least $419 million in disputed tax assessments.
The court ruled unanimously in another case that the money S&Ls receive from depositors who pay penalties for early withdrawals is taxable. That decision will cost some S&Ls at least $128 million plus interest, government lawyers said.
- Allowed businesses to specify in contracts with their customers where they can, or cannot, be sued.
By a 7-2 vote, the justices barred a Washington state woman from suing in federal court in her home state a cruise ship line based in Miami.
In the airline case, lawyers for Eastern told the high court that in most states passengers on domestic flights who can prove negligence - but not willful misconduct - are barred from recovering damages for mental anguish unaccompanied by physical injury.
The Warsaw Convention requires airlines to pay up to $75,000 per person depending on the severity of the injuries in air accidents. That ceiling is lifted only if an airline is shown to have committed willful misconduct.
The high court Wednesday reversed a ruling by the 11th U.S. Circuit Court of Appeals, which permitted money damages in the case of Eastern flight 855, which left Miami on May 5, 1983, for Nassau, Bahamas.