## Facts

- In 1957, Terry McCann lived in Oklahoma and worked for a construction company installing a large boiler at an Oklahoma oil refinery.
- McCann allegedly was exposed to asbestos over a two-week period while observing an independent contractor apply asbestos insulation to the boiler.
- In 1975, McCann moved to California and remained a California resident.
- In 2005, McCann was diagnosed with mesothelioma and sued Foster Wheeler LLC in California, alleging the 1957 Oklahoma exposure caused his disease.
- The action was timely under California’s asbestos-related limitations rules.
- Foster Wheeler asserted Oklahoma’s 10-year statute of repose for claims against designers/constructors of improvements to real property, which would bar the claim decades before diagnosis.

## Issues

1. Under California’s governmental-interest choice-of-law test, should California apply Oklahoma’s statute of repose or California’s statute of limitations to an asbestos personal injury claim based on exposure in Oklahoma brought by a long-term California resident against a non-Oklahoma defendant?
2. Does Oklahoma have a sufficient interest in applying its statute of repose to improvements located in Oklahoma even when the defendant is not an Oklahoma domiciliary?

## Decision

- The California Supreme Court held Oklahoma law governed the timeliness issue and Oklahoma’s statute of repose barred the claim.
- The court reversed the Court of Appeal and directed affirmance of summary judgment for Foster Wheeler.
- The court treated the statute of repose as reflecting substantive Oklahoma policy, not merely a procedural filing rule.
- The court accepted the trial court’s determination that the boiler was an improvement to real property within the meaning of the Oklahoma statute.

## Legal Principles

- California applies a governmental-interest choice-of-law analysis: identify a conflict, determine each state’s interest, and apply the law of the state whose interest would be more impaired if not applied.
- A “true conflict” exists when each jurisdiction has a legitimate interest in applying its own law to the dispute.
- A statute of repose may embody substantive policy choices (finality and liability limits for specified defendants) and may be applied by a California forum when the regulated activity and improvement are centered in the foreign state.
- A state’s interest in applying a repose statute for improvements to real property is not limited to protecting in-state domiciliaries; it extends to regulating liability arising from improvements located within its borders.
- In comparative impairment, a forum state’s interest in compensating a resident for an out-of-state injury can yield when applying forum law would substantially defeat the other state’s liability-limiting regime tied to conduct and property within that state.

## Conclusion

California’s choice-of-law methodology required application of Oklahoma’s statute of repose because Oklahoma’s interest in providing finality for liability tied to improvements on Oklahoma real property would be more impaired by applying California limitations law than California’s interest in providing a remedy to a resident for a latent disease based on out-of-state exposure.


McCann v. Foster Wheeler LLC, 48 Cal. 4th 68, 105 Cal. Rptr. 3d 378, 225 P.3d 516 (Cal. 2010)