David Pals v. Schepel Buick & GMC Truck, Inc.

In the
United States Court of Appeals
For the Seventh Circuit
No. 99-3551
David Pals,
Plaintiff-Appellee,
v.
Schepel Buick & GMC Truck, Inc.,
Defendant-Appellant.
Appeal from the United States District Court for the
Northern District of Indiana, Hammond Division.
No. 2:97-CV-246-AR--Andrew P. Rodovich, Magistrate Judge.
Argued May 16, 2000--Decided July 14, 2000
Before Easterbrook, Ripple, and Rovner, Circuit
Judges.
Easterbrook, Circuit Judge. Afflicted with
muscular dystrophy, David Pals worked for 26
years as the used car manager of Schepel Buick.
Pals appraised cars offered for trade-in, decided
whether to resell used cars to other dealers or
at retail, arranged for the cars to be cleaned up
and repaired, managed inventory and personnel,
and handled related matters. All of these he was
able to do despite decreasing mobility as the
years passed. During the early 1990s Pals began
to delegate some inspection functions to
Schepel’s cleanup and repair personnel. Instead
of test-driving cars and sometimes crawling under
(or over) them to assess their condition, Pals
had other employees perform these tasks, making
appraisals on the basis of their reports. In July
1996 Pals had an accident at home that curtailed
circulation to his left leg for several hours and
left him unable to walk. When Pals sought to
return to work in February 1997, Schepel
declined, telling him that his limitations
precluded doing the used car manager’s job. In
this suit under Title I of the Americans with
Disabilities Act, 42 U.S.C. sec.sec. 12111-17, a
jury disagreed with Schepel’s assessment and
awarded Pals $1,050,000 in damages.
Schepel contends that the evidence did not
permit a rational jury to find for Pals, but

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because we must view all inferences in the light
most favorable to the verdict this position is
untenable. For example, Schepel contends that
Pals cannot perform all essential functions of
the job and therefore is not a "qualified
individual with a disability" under the ADA. 42
U.S.C. sec.sec. 12111(8), 12112(a). The only
function he can’t handle, however, is inspecting
cars personally. A rational jury could conclude
that this is not an essential, or even an
important, aspect of the used car manager’s
position, given that Pals had delegated this task
for years before the accident. Schepel has not
suggested that appraisals were less accurate as
a result or that it cost the firm even a penny
extra for other employees to devote some of their
time to this endeavor. Perhaps relieving Pals of
the inspection duty counts as an accommodation
under the ADA, but if so it was no less available
as an accommodation after Pals became wheelchair-
bound than before his accident.
Appealing to the principle that the ADA does not
require an employer to displace another person
already in a position, see Gile v. United
Airlines, Inc., 95 F.3d 492, 499 (7th Cir. 1996),
Schepel contends that it had no vacancy for Pals
to fill early in 1997. But the jury could have
determined that Wayne Wiarda, who performed
Pals’s functions during his absence, had not
taken over the job but was instead filling in
just as he had done for years during Pals’s
vacations and illnesses. Nor does Pals’s request
to return initially on a part-time basis
disqualify him under the ADA. Employees who have
experienced serious medical problems often return
to work part-time and increase their hours until
they are working full time. This is what Pals
proposed to do. If (as the jury could have found)
Wiarda was available to fill in for whatever
hours Pals did not cover at the outset, gradual
return to full-time work would have been a
reasonable accommodation that the ADA required
Schepel to provide. 42 U.S.C. sec.sec.
12111(9)(B), 12112(b)(5).
That Pals filed applications for benefits under
Schepel’s disability plan likewise does not
foreclose recovery. See Cleveland v. Policy
Management Systems Corp., 526 U.S. 795 (1999).
Pals was indeed disabled for the second half of
1996 and early in 1997, but during these months
he underwent physical therapy to regain mobility.
By February 1997 he could get out of his
wheelchair (though with difficulty) and drive his
car to the dealership. His physical therapist
testified that Pals could perform the required
tasks. Schepel responds that even as late as
February, however, when filling out an
application for long-term disability benefits,

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Pals answered "all of them" to the question what
tasks he was unable to perform. Cleveland holds
that an employee making claims under the ADA must
give a satisfactory explanation for such
inconsistency. One possible explanation might
have been that Pals completed this form two days
after meeting with Schepel’s managers and
learning that he would not be welcomed back. If
his employer treated him as permanently disabled,
then he was entitled to collect on his employer’s
disability-benefits program. But this is not the
explanation Pals gave at trial, where he
testified that he had misread the form and
thought that he was being asked what tasks he was
able to perform. That strikes us as weak--
insurance law holds applicants to their answers
and does not permit lame excuses for falsehoods,
and if Pals thought he was able to perform all
tasks why was he applying for benefits?--but not
so weak that a jury was obliged to disbelieve it
for purposes of a claim under the ADA, which
(Cleveland holds) does not treat general
assertions of disability as conclusive against
applicants. None of Schepel’s claims of trial
error is persuasive, so the jury’s verdict on
liability stands.
Damages are another matter, considerably more
difficult. Pals contended that he suffered three
kinds of harm: lost back wages, lost future
income, and mental distress. Pals himself
supplied most information and computations;
Schepel neither cross-examined him on these
subjects nor presented evidence (or calculations)
of its own. Pals sought approximately $350,000
for past financial loss, $1,700,000 for future
financial loss, and an unspecified amount for
noneconomic loss. A magistrate judge, presiding
by consent under 28 U.S.C. sec.636(c), gave the
jury a general-verdict form telling it to
determine the amount of "compensatory damages" to
which Pals was entitled. After the verdict fixed
these at $1,050,000, Schepel asked the court to
reduce the award to $100,000 under 42 U.S.C.
sec.1981a(b)(3)(B). This statute, part of the
Civil Rights Act of 1991, applies to ADA cases,
see sec.1981a(a)(2). Section 1981a(b)(3) reads:
The sum of the amount of compensatory damages
awarded under this section for future pecuniary
losses, emotional pain, suffering, inconvenience,
mental anguish, loss of enjoyment of life, and
other nonpecuniary losses, and the amount of
punitive damages awarded under this section,
shall not exceed, for each complaining party . .
. (B) in the case of a respondent who has more
than 100 and fewer than 201 employees in each of
20 or more calendar weeks in the current or
preceding calendar year, $100,000[.]

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Schepel, which has more than 100 and fewer than
201 employees, believes that its exposure cannot
exceed $100,000. After all, the verdict form and
the instructions called the award "compensatory
damages."
Yet sec.1981a(b)(3) does not set a limit on
"compensatory damages" as that term may be used
colloquially, or even "compensatory damages" as
lawyers normally employ that term. The cap limits
"the amount of compensatory damages awarded under
this section for future pecuniary losses,
emotional pain, suffering, inconvenience, mental
anguish, loss of enjoyment of life, and other
nonpecuniary losses" (emphasis added). Are back
and front pay in an ADA action awarded under
sec.1981a? Section 1981a(b)(2) tells us that
"Compensatory damages awarded under this section
shall not include backpay, interest on backpay,
or any other type of relief authorized under
section 706(g) of the Civil Rights Act of 1964",
42 U.S.C. 2000e-5(g). So back pay falls outside
the cap. Section 706(g)(1) does not mention front
pay, but it does permit a court to order
"reinstatement or hiring of employees, with or
without back pay . . ., or any other equitable
relief as the court deems appropriate." Front pay
is in lieu of reinstatement, and as a substitute
for a remedy under sec.706(g)(1) "front pay falls
squarely within the statutory language
authorizing ’any other equitable relief [as the
court deems appropriate].’" Williams v.
Pharmacia, Inc., 137 F.3d 944, 952 (7th Cir.
1998). We did not consider in Williams the effect
of this conclusion on sec.1981a; all Williams
holds is that sec.706(g)(1) authorizes front pay
as an equitable remedy. Section 1981a(b)(2) gives
this another effect, however, and we now put two
and two together. Neither back nor front pay
counts against a maximum award of compensatory
damages under sec.1981a(b)(3). Accord, EEOC v.
W&O, Inc., 2000 U.S. App. Lexis 11935 at *40-43 &
n.10 (11th Cir. May 30, 2000); Gotthardt v.
National R.R. Passenger Corp., 191 F.3d 1148,
1153-54 (9th Cir. 1999); Martini v. Federal
National Mortgage Ass’n, 178 F.3d 1336, 1348-49
(D.C. Cir. 1999); Medlock v. Ortho Biotech, Inc.,
164 F.3d 545, 556 (10th Cir. 1999); Kramer v.
Logan County School District, 157 F.3d 620, 626
(8th Cir. 1998).
One court has gone the other way. Hudson v.
Reno, 130 F.3d 1193, 1202-03 (6th Cir. 1997),
criticized but followed by Pollard v. E.I. DuPont
de Nemours Co., 2000 U.S. App. Lexis 11750 at *29-
31 (6th Cir. May 26, 2000). Hudson reasoned that
unless front pay were charged against the cap,
the words "future pecuniary losses" would be
empty. What kind of "future pecuniary losses"
other than front pay might be covered by

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sec.1981a(b)(3)?, the court wondered. One answer
is future medical expenses (often for mental-
health matters), a kind of financial loss that
comes up now and again in civil rights actions.
See, e.g., Williamson v. Handy Button Machine
Co., 817 F.2d 1290, 1293 (7th Cir. 1987). The
maxim that statutes should be read to give
meaning to every phrase does not mean that they
should be read to make every phrase important;
many a provision covers unusual circumstances.
Section 1981a(b), read in conjunction with
sec.706(g)(1) to exclude front pay from the cap,
has plenty of work still to do, and every word
can be given some effect.
Because the jury did not separate compensatory
damages under sec.1981a from other monetary
relief, it is impossible to know whether the
verdict includes more than $100,000 in
"compensatory damages awarded under this
section". Like the magistrate judge, we think
that Schepel has only itself to blame. Pals’s
lawyer and the magistrate judge obviously had not
focused on sec.1981a(b)(3). Schepel’s lawyer sat
quietly as the jury instructions and verdict
forms were approved and did nothing to avert the
problem. (Schepel does not contend on appeal that
its trial lawyer was clueless about sec.1981a
until after the verdict.) When lawyers fail to
draw the court’s attention to a preventable
problem, they must bear the consequences of
forfeiture. At oral argument Schepel’s lawyer
protested that there was no problem to prevent,
no error requiring objection. All this shows,
however, is that Schepel’s lawyer does not
understand the nature of the difficulty: the
difference between a generic reference to
"compensatory damages" and the more limited scope
of sec.1981a(b)(3), which affects only
"compensatory damages awarded under this
section". Having stood silent when it was
possible to frame questions so that the jury
could reveal which of the damages had been
awarded under sec.1981a, Schepel has forfeited
any benefit of sec.1981a(b)(3)(B).
Before affirming on the basis of this
forfeiture, however, we must consider the
possibility that even with the parties’
acquiescence a jury may not determine the amounts
of back and front pay. Section 1981a(c) provides:
"If a complaining party seeks compensatory or
punitive damages under this section--(1) any
party may demand a trial by jury; and (2) the
court shall not inform the jury of the
limitations described in subsection (b)(3) of
this section." Pals demanded and was entitled to
a jury trial--but on what issues? The parties and
the magistrate judge assumed (without giving the
matter detailed attention) that the answer is

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"every issue," but that can’t be right. "The
issue, not the action, is the basic unit for
determining jury-triability . . . and the rules
contemplate that in the one action some issues
will be tried to the court and others will be
tried to the jury." Charles Alan Wright & Arthur
R. Miller, 9 Federal Practice and Procedure
sec.2331 (2d ed. 1994). Suppose Pals and Schepel
disagreed about whether reinstatement was
superior to front pay. Choosing between
reinstatement and front pay and, if the latter,
the amount of front pay, would have been subjects
for the judge under sec.706(g)(1). Likewise, one
supposes, with other equitable remedies: juries
don’t draft injunctions. Back pay and front pay
are equitable remedies under sec.706(g)(1) and
therefore matters for the judge even after
sec.1981a(c), as the only published appellate
decisions on point conclude. EEOC v. W&O, supra
at *43; Allison v. Citgo Petroleum Corp., 151
F.3d 402, 423 n.19 (5th Cir. 1998). When
assessing back pay, or awarding front pay in lieu
of reinstatement, the judge must respect the
findings implied by the jury’s verdict. See Dairy
Queen, Inc. v. Wood, 369 U.S. 469 (1962); Beacon
Theatres, Inc. v. Westover, 359 U.S. 500 (1959);
Dranchak v. Akzo Nobel Inc., 88 F.3d 457, 458-59
(7th Cir. 1996); McKnight v. General Motors
Corp., 908 F.2d 104, 113 (7th Cir. 1990). But
whatever discretion the facts allow with respect
to back pay and front pay belongs to the judge
rather than the jury.
To say that sec.1981a(c) does not entitle
either side to a jury trial on back or front pay
does not mean, however, that a jury trial is
forbidden even if the parties are content.
In all actions not triable of right by a jury the
court upon motion or of its own initiative may
try any issue with an advisory jury or, except in
actions against the United States when a statute
of the United States provides for trial without
a jury, the court, with the consent of both
parties, may order a trial with a jury whose
verdict has the same effect as if trial by jury
had been a matter of right.
Fed. R. Civ. P. 39(c). Thus an issue may be tried
to the jury "with the consent of both parties"
even if the issue is "not triable of right by a
jury". Front pay and back pay under Title VII and
the ADA are "equitable" matters, but they still
are dollar values; allowing a jury to liquidate
these sums is a far cry from allowing a jury to
draft an injunction. After all, "back pay" under
the ADA is very similar to "lost wages" in a tort
or contract suit under state law, and "front pay"
is like lost future income. Juries routinely
determine lost wages and discount future income

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loss to present value. If hundreds of juries
render verdicts on these subjects every day
across the country, they can’t be beyond the
scope of consent under Rule 39(c). E.g., Place v.
Abbott Laboratories, No. 99-2418 (7th Cir. June
1, 2000), slip op. 5 (recounting that in a case
under sec.1981a the jury had awarded back pay
while the judge denied front pay).
Well, then, did these parties consent to have
the jury decide both back pay and front pay? Not
in so many terms, but neither did either party
object--and Schepel’s answer to Pals’s complaint
does "demand trial by jury as to all issues
herein" (emphasis added). "If one party demands
a jury, the other parties do not object, and the
court orders trial to a jury, this will be
regarded as jury trial by consent" under Rule
39(c). Wright & Miller at sec.2333. See Alcatel
USA, Inc. v. DGI Technologies, Inc., 166 F.3d
772, 795 n.101 (5th Cir. 1999). For purposes such
as this, implied consent is as good as express
consent--for pleadings may be amended by implied
consent, see Fed. R. Civ. P. 15(b), which means
that when both sides are content to have an issue
decided by the jury, the pleadings are deemed
amended to give permission.
Schepel did not introduce any evidence to
undercut Pals’s estimates of his financial loss
and therefore is in no position to contest the
million-dollar award, apart from its reliance on
sec.1981a(b)(3). Because that contention has been
forfeited, and because mutual implied consent
supports the jury’s authority to resolve issues
that normally would be decided by the court, the
judgment is
affirmed.

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