By Bruce Merenstein
Special to the Legal
It is axiomatic that state trial courts are bound by precedential opinions of intermediate appellate courts and state supreme courts within their jurisdiction. But precedents change. Despite the force of stare decisis, courts frequently revisit prior rulings and either overrule or substantially modify established legal doctrines. It is equally well-established in Pennsylvania (as in most jurisdictions) that, as set forth in the appellate rules, “issues not raised in the lower court are waived and cannot be raised for the first time on appeal.” Thus, lawyers often face the dilemma of whether they should make arguments in a trial court that are foreclosed by precedent of a higher court.
In a recent decision, Schmidt v. Boardman Co., the Supreme Court clarified that in such circumstances, a litigant must raise the futile argument in the trial court (and presumably in the intermediate appellate court) in order to preserve it for later review by the court that has the authority to revisit its prior rulings.
In Schmidt, the trial court held that a corporation could be liable for injuries suffered as a result of an allegedly defective product made by a predecessor corporation under the so-called product-line exception to the general rule of successor non-liability. The trial court instructed the jury on the exception and, following a verdict for the plaintiffs, entered judgment and denied all of the defendant’s challenges to the verdict.
In the trial court — and on appeal to the Superior Court — the defendant never argued that Pennsylvania should reject the product-line exception in its entirety; rather, it simply mounted a number of challenges to the trial court’s jury instructions and the sufficiency of the evidence supporting the exception.
Before the Supreme Court, however, the defendant argued “the product-line exception to the established rule of successor non-liability [is] inconsistent with the rationale underlying strict products liability,” and should be rejected outright. The defendant contended that it failed to raise this broad challenge to the exception earlier because such a challenge was foreclosed by Superior Court precedent, which had adopted the product-line exception. But the defendant argued that, now that it was before the highest state court, which was not bound by Superior Court precedent, it should be free to raise the issue that it would have been fruitless to raise earlier. The Supreme Court disagreed.
The court initially recognized “that there are good reasons supporting an approach that does not require useless objections, and many courts have ascribed to such practice.” But the court held that the countervailing rationale for requiring parties to raise arguments in lower courts, even when those arguments are foreclosed by controlling precedent, was stronger.
As the court explained, the burden on courts of entertaining objections that are plainly meritless was slight, “particularly where the litigant acknowledges the binding nature of the prevailing precedent but merely indicates that it wishes to preserve a challenge for review on later appeal.” By contrast, “the salutary effect of narrowing the scope of appeals from an earlier stage of litigation is to put the court and all parties on appropriate notice and to facilitate informed decision making.”
Importantly, the court distinguished situations where a party fails to raise an issue in the trial court, but the law changes during the pendency of a case. In those situations, a litigant may not be foreclosed from relying on the new precedent, even if it had failed to raise the issue because of its “good faith reliance on the existing state of the law” during the trial proceedings.
The lesson from Schmidt is that lawyers seeking to avoid waiver problems on appeal should raise any and all arguments in the trial court that (to borrow a phrase from Pa.R.Civ.P. 1023.1), “are warranted by existing law or by a nonfrivolous argument for the extension, modification or reversal of existing law or the establishment of new law.”
Bruce P. Merenstein is a partner with Schnader Harrison Segal & Lewis, with a practice focused primarily on appellate litigation in state and federal courts. He can be reached by e-mailing firstname.lastname@example.org.
This posting is intended only to inform, not to provide legal advice; and readers should seek professional advice for specific applications of the information.