Title: Wireman v. Keneco Distributors, Inc.

State: ohio

Issuer: Ohio Supreme Court

Document:

Wireman, Administrator, et al., Appellants, v. Keneco Distributors, Inc., et 
1 
al.; Marathon Oil Company et al., Appellees. 
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[Cite as Wireman v. Keneco Distributors, Inc. (1996), ___ Ohio St.3d. ___.] 
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Torts -- Wrongful death -- Products liability -- “Product” as used in 
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R.C. 2307.71, construed and applied -- Failure to warn -- R.C. 
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2307.76, applied. 
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(No. 94-1448 -- Submitted October, 1995 -- Decided March 4, 1996.) 
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APPEAL from the Court of Appeals for Wood County,  No. 93WD 
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078. 
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Appellant, Peggy Wireman, is the administrator of the estate of her 
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late husband, Douglas E. Wireman.  On August 24, 1990, Douglas Wireman 
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was working in a bulk gasoline storage tank near Portage, Ohio, when the 
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tank exploded.  Douglas Wireman died two days later from the injuries he 
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sustained in this explosion. 
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Appellee Marathon Oil Company ("Marathon") originally installed 
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the storage tank in which Douglas Wireman suffered his fatal injuries.  The 
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tank was placed at the Portage site when Marathon converted one of its 
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service stations to a bulk plant. In 1980, Marathon designed and had 
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installed a vapor recovery system ("VRS") for gasoline storage tanks at the 
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2 
Portage site.  The purpose of this system was twofold.  The first purpose of 
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the VRS was that it allows petroleum vapor pressure to balance among 
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connected storage tanks -- thus, reducing the chances that fumes would be 
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released into the atmosphere due to high vapor pressure.  The second 
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purpose of the VRS was that it prevented gasoline vapors from entering the 
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environment during the loading and unloading of petroleum products. 
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In 1988, Marathon leased the Portage plant to Keneco Distributors, 
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Inc. ("Keneco").  The following year, Marathon sold the plant to Keneco's 
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land-holding corporation, KDI Properties, Inc.  Keneco contracted with 
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Marathon to continue to use the plant to distribute Marathon products. 
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During the late spring of 1990, Keneco sought to extend the life of its 
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above-ground storage tanks and reduce the possibility of a petroleum spill 
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into a branch of the nearby Portage River.  To this end, Keneco hired 
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Interdyne Corporation to clean the tanks and fiberglass the bottom and part 
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of the interior walls.  Interdyne, in turn, hired K-M Contracting, Inc.  ("K-
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M") to sandblast the tanks and to actually install the fiberglass material.  It 
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appears K-M, in turn, hired Aerco Sandblasting, Inc., to sandblast the tank's 
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interior walls.   
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3 
 
On the morning of August 24, 1990, a Northwest Enterprises, Inc. 
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transport truck delivered approximately eight thousand five hundred gallons 
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of gasoline to the Portage bulk plant.  The transport truck’s driver, Steve 
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Freymuth, did not utilize the vapor recovery system at the plant because he 
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had been told by Keneco employees that it was inoperative.   
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Shortly following the tanker's departure, K-M employees, brothers 
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Robert and Douglas Wireman, arrived at the plant for the purpose of 
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installing the fiberglass material in four of the plant's tanks.  These tanks 
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were to have previously been prepared for the installation.  They were to 
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have been powerwashed and sandblasted, and the resulting debris was to 
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have been removed by Interdyne and Aerco.  However, when Douglas 
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Wireman examined the interior of tank 101, he discovered sand on the floor.  
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Because the fiberglass material could not be installed over the sand, 
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Douglas Wireman borrowed a common Black and Decker shop vac and an 
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extension cord from Keneco employees.   
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When Douglas Wireman started the shop vac inside tank 101, an 
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explosion took place which separated the tank's lid from its sides at the 
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weld.  Douglas Wireman died of the injuries he received in the blast. 
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4 
 
Following Douglas Wireman's death, appellants, Peggy Wireman as 
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administrator of his estate and individually as his wife, brought this 
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wrongful death suit.  Appellants alleged that the failure of the transport 
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driver to utilize the vapor recovery system during the delivery of eight 
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thousand five hundred gallons of gasoline displaced gasoline vapors into the 
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VRS which relayed these explosive vapors into tank 101.  It was these 
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vapors that were ignited by the spark from Douglas Wireman's shop vac, 
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causing the explosion that killed him.  Appellants’ suit named ten 
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corporations and individuals as defendants alleging a variety of negligent 
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acts among them.  Included among these defendants were the petroleum 
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transport company, appellees Northwest Enterprises, Inc., d.b.a. Northwest 
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Oil Co., Northwest Enterprises’ president, appellee Harold Jackson, Jr., and 
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its driver, appellee Steve Freymuth.  Appellants also sued the decedent's 
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employer, appellee K-M Contracting, Inc. and its president and sole 
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stockholder, appellee Kevin L. Everhardt.  Appellee Marathon Oil Company 
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was another named defendant.   
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In the trial court, appellees Northwest Enterprises, Inc. (Northwest 
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Oil, Inc.), Jackson, Freymuth, Everhardt and Marathon Oil Company moved 
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5 
for and were granted summary judgment.  The trial court's determined that, 
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pursuant to Civ.R. 54(B), that there was no just cause for delay.  
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The Court of Appeals for Wood County affirmed the trial court’s 
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award of summary judgment. 
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This matter is now before this court upon the allowance of 
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discretionary appeal. 
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Mihlbaugh & Mihlbaugh, Michael P. Mihlbaugh and Robert H. 
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Mihlbaugh for appellants.  
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Shumaker, Loop & Kendrick, John C. Barron, Thomas P. Dillon and 
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Jeffrey S. Creamer, for appellee Marathon Oil Company. 
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Hammond Law Office and Frederick A. Sewards, for appellees 
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Northwest Enterprises, Inc., Freymuth and Jackson. 
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John K Fitch, urging reversal for amicus curiae, Ohio Academy of 
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Trial Lawyers. 
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PFEIFER, J.  Appellants contend that Wireman was fatally injured 
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when he was negligently instructed to use a shop vac to clean tank 101.  
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Appellants contend that the explosion of tank 101 was caused by a spark 
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from the shop vac igniting gasoline vapors in the tank.  Appellants claim 
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6 
that the gasoline vapors flowed into tank 101 through a pipe in the VRS that 
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connects tank 101 to an adjoining tank.  Appellants contend that Marathon’s 
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design of the VRS was defective because it allowed this flow of fumes.  On 
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the morning of Wireman’s fatal injury, an adjoining tank had been filled 
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with gasoline by an employee of Northwest.  Appellants contend that if the 
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VRS had been used as designed during the delivery of gasoline from the 
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Northwest truck into the adjoining tank, the fumes from the gasoline being 
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pumped into the tank would have been returned to the Northwest truck and 
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would not have gone into tank 101. 
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Appellants contest the trial court’s award of summary judgment to 
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Marathon, Freymuth, Northwest and Jackson.   
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I 
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Claims against Marathon 
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A 
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Products Liability 
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The court of appeals upheld the trial court’s award of summary 
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judgment for Marathon because it found that the VRS was not tangible 
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personal property as defined in R.C. 2307.71, and, thus, appellant could not 
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pursue a products liability claim against Marathon.  R.C. 2307.71 provides 
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in relevant part: 
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“As used in sections 2307.71 to 2307.80 of the Revised Code: 
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“* * * 
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“(L)(1) ‘Product’ means, subject to division (L)(2) of this section, any 
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object, substance, mixture, or raw material that constitutes tangible personal 
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property * * *.”  (Emphasis added.) 
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Under this definition, an item must be personal property before it can 
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fall within the realm of products liability.  The court of appeals found the 
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VRS to be a fixture.  Because we find that the VRS is not a fixture, we hold 
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that the VRS is personal property. 
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In Teaf v. Hewitt (1853), 1 Ohio St. 511, this court adopted the 
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following definition of fixtures: 
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“A fixture is an article which was a chattel, but which by being 
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physically annexed or affixed to the realty, became accessory to it and part 
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and parcel of it.  But the precise point in the connection with the realty, 
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where the article loses the legal qualities of a chattel and acquires those of 
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the realty, often presents a question of great nicety and sometimes difficult 
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determination.” Id. at 527.   
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“From the examination which I have been enabled to give to this 
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subject, and after a careful review of the authorities, I have reached the 
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conclusion that the united application of the following requisites will be 
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found the safest criterion of a fixture. 
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“1st. Actual annexation to the realty, or something appurtenant 
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thereto. 
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“2d. Appropriation to the use or purpose of that part of the realty with 
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which it is connected. 
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“3d. The intention of the party making the annexation, to make the 
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article a permanent accession to the freehold -- this intention being inferred 
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from the nature of the article affixed, the relation and situation of the party 
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making the annexation, the structure and mode of annexation, and the 
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purpose or use for which the annexation has been made.” Id. at 529-530. 
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Appellants contend that the VRS does not meet the third prong of this 
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definition.  Because we find that there was never an intention to make the 
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VRS a permanent accession to the freehold where it was being used, we 
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agree with appellants.   
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The record is clear that Marathon lacked the requisite intent to make 
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the VRS a permanent addition to the bulk plant.  The VRS was attached to 
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four aboveground storage tanks.  On October 3, 1989, Marathon sold the 
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tanks along with the VRS by a bill of sale, pursuant to an earlier agreement 
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to an offer to purchase.  It is a long-standing rule of law that when property 
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is sold by bill of sale, the property is presumed to be personalty.  See 
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Fortman v. Goepper (1863), 14 Ohio St. 558. 
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Also, in the offer to purchase agreed to by Marathon and Keneco, 
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there is a provision obligating Keneco to remove the aboveground storage 
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tanks if removal is required by law.  Thus, Marathon never intended that 
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those tanks and attached VRS be a permanent part of the premises where 
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they rested.  Finally, a bill of sale for similar, tanks on the premises, which 
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was agreed to by Marathon, classified those tanks as personal property.   
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For these reasons we find that the VRS was personal property when 
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Wireman was fatally injured.  Thus, the court of appeals erred when it 
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concluded that the VRS was a fixture, and its judgment concerning this 
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legal issue is reversed.   
2 
B 
3 
Failure to Warn 
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Appellants claim that the court of appeals erred when it upheld the 
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trial court’s award of summary judgment to Marathon on appellants’ failure-
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to-warn claim.  We agree with appellants that their failure-to-warn claim 
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should survive Marathon’s motion for summary judgment. 
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Appellant’s theory of liability is that Marathon failed to post a 
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warning for the benefit of those entering the tank.  Presumably, such a 
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warning would state that petroleum vapors might be present in the tank, due 
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to the connections between the four aboveground tanks, even if no fuel is 
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present in the tank being entered.  This claim was not addressed by the court 
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of appeals in its opinion.   
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R.C. 2307.76 regulates failure-to-warn claims.  The statute provides: 
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“(A) Subject to divisions (B) and (C) of this section, a product is 
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defective due to inadequate warning or instruction if either of the following 
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applies: 
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“(1) It is defective due to inadequate warning or instruction at the 
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time of marketing if, when it left the control of its manufacturer, both of the 
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following applied: 
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“(a) The manufacturer knew or, in the exercise of reasonable care, 
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should have known about a risk that is associated with the product and that 
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allegedly caused harm for which the claimant seeks to recover 
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compensatory damages; 
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“(b) The manufacturer failed to provide the warning or instruction 
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that a manufacturer exercising reasonable care would have provided 
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concerning that risk, in light of the likelihood that the product would cause 
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harm of the type for which the claimant seeks to recover compensatory 
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damages and in light of the likely seriousness of that harm.” 
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We find the record contains sufficient evidence supporting 
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appellants’ failure-to-warn claim.  It is undisputed that Marathon never 
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posted a warning on the side of tank 101 or on the VRS which indicated that 
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fumes may be present in the tank that DouglasWireman entered. 
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Marathon appears to argue that appellants are precluded from 
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bringing a failure-to-warn claim because Marathon claims that the VRS is 
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not a “product” under R.C. 2307.76.  Because R.C 2307.76 the uses the 
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definition of “product” in R.C. 2307.71, and because we have already 
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determined that the VRS is a product pursuant to R.C. 2307.71, we hold that 
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appellants’ failure-to-warn claim is sufficient to survive a motion for 
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summary judgment.  We reverse the judgment of the court of appeals on this 
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issue. 
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C 
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Premises Liability 
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Appellants also claim that the trial court erred when it granted 
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Marathon’s motion for summary judgment because the record contains 
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sufficient evidence that Marathon intentionally violated the terms of its 
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permit to operate. The permit provides in relevant part: 
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“Any malfunction of this source or any associated air pollution 
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control system(s) shall be reported immediately to the appropriate Ohio 
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EPA field office in accordance with OAC rule 3745-15-06.  Except as 
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provided in that rule, any scheduled maintenance or malfunction 
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necessitating the shut down or bypassing of any air pollution control 
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system(s) shall be accompanied by the shut down of this source.”  
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13 
 
Appellants contend that Marathon should have shut down the bulk 
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plant as soon as it discovered that loading arm of the VRS was not operating 
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correctly.  If the plant had been shut down by Marathon, appellants contend, 
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Wireman would have never been injured. 
4 
 
The problem with appellants’ argument is that Marathon was 
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powerless to shut down the bulk plant. It is a fundamental tenet of premises 
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tort law that to have a duty to keep premises safe for others one must be in 
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possession and control of the premises.  Wills v. Frank Hoover Supply 
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(1986), 26 Ohio St.3d 186, 26 OBR 160, 497 N.E.2d 1118.  Therefore, we 
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affirm the judgment of the court of appeals on this issue. 
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D 
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Agency 
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Appellants contend that the court of appeals erred when it upheld the 
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trial court’s award of summary judgment to Marathon for appellants’ agency 
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claim.  We disagree with appellants. 
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In essence, appellants argue that the employees of Keneco who 
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negligently directed Douglas Wireman to use a shop vac in tank 101 
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appeared to Wireman to be agents of Marathon.  Thus, Marathon should be 
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14 
liable for the Keneco employees’ negligence.  See Shaffer v. Maier (1994), 
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68 Ohio St.3d 416, 627 N.E.2d 986.  We decline to consider this issue, 
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however, because it was not raised by appellants in the court of appeals and 
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has been waived.   
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II 
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Claims against Northwest, Jackson and Freymuth 
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Appellants contend that the trial court erred when it granted the 
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motion for summary filed by Northwest, Jackson and Freymuth.  
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Appellant’s theory of liability is that Freymuth violated Ohio Adm. Code 
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3745-21-09 (V)(1)(i) when he failed to use the VRS as he was unloading his 
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tanker truck at the bulk plant.  The regulation provides: 
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“No gasoline tank truck is to be used for the transfer of gasoline at a 
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bulk gasoline terminal, bulk gasoline plant or gasoline dispensing facility 
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that employs a vapor balance system or vapor control system unless the 
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transfer is done in a manner that ensures the proper operation of the vapor 
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balance system or vapor control system.” 
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15 
 
Appellant contends that because Freymuth violated this section of the 
1 
code, he, his employer, Northwest, and the president and sole shareholder of 
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Northwest, Jackson, were all negligent per se.  We disagree. 
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Where an enactment imposes upon a person a specific duty for the 
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protection of others, his failure to observe that duty constitutes negligence 
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per se. Taylor v. Webster (1967), 12 Ohio St.2d 53, 56, 41 O.O.2d 274, 275, 
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231 N.E.2d 870, 872. 
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In order to determine whether a violation of Ohio Adm. Code 3745-
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21-09 constitutes negligence per se, we must first determine whether this 
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Administrative Code provision was intended to affect the duties owed for 
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the safety and protection of others.  See Hernandez v. Martin Chevrolet 
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Inc.(1995), 72 Ohio St.3d 302, 649 N.E.2d 1215. 
12 
 
An examination of the code provision reveals that it is an 
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environmental regulation intended to prevent the emissions of fumes into 
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the atmosphere.  The code provision is entitled, “Control of emissions of 
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volatile organic compounds from stationary sources.”  Thus, the 
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Administrative Code provision that Freymuth allegedly violated may 
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impose on Marathon a duty to refrain from releasing fumes into the 
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16 
atmosphere.  Appellants do not contend that Douglas Wireman was injured 
1 
by a release of fumes from the VRS into the atmosphere.  Therefore, 
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Douglas Wireman’s injury was not caused by any breach of any duty created 
3 
by the Administrative Code provision.  We affirm the judgment of the court 
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of appeals on this issue.  This cause is remanded to the trial court for further 
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proceedings not inconsistent with this opinion. 
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Judgment affirmed in part, 
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reversed in part and 
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cause remanded. 
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DOUGLAS, RESNICK and F.E. SWEENEY, JJ.,  
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MOYER, C.J., WRIGHT and COOK, JJ., dissent. 
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Cook, J., dissenting.  I respectfully dissent from that portion of the majority’s opinion that 
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reverses the summary judgment granted in favor of Marathon Oil Co. (“Marathon”) on 
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issues related to strict products liability and failure to warn.  In arriving at its conclusion 
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that summary judgment was improperly awarded to Marathon at the trial court level, the 
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majority appears to bypass the primary step of determining whether Marathon is a 
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manufacturer of vapor recovery systems (“VRS”) within the meaning of R.C. 2307.71(I).  
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Because the evidence placed before the trial court compels a conclusion that Marathon is 
18 
17 
not a manufacturer of VRS within the meaning of R.C. 2307.71(I), I would affirm the 
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appellate court’s opinion in all respects. 
2 
 
As defined in R.C. 2307.71(I), a “manufacturer” is “a person engaged in a 
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business to design, formulate, produce, create, make, construct, assemble or rebuild a 
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product or a component of a product.”  (Emphasis added.)  The language employed in  
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R.C. 2307.71(I) is directly imported from Section 402A of the Restatement of  Torts 2d 
6 
(1965) 347-348, and is consistent with the Restatement’s public policy designs. 
7 
 
In supplying the requirement that one must be “engaged in a business” in order to 
8 
be classified as a manufacturer and concomitantly to become subject to the particularized 
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liability scheme of R.C. 2307.71 through 2307.80, it is clear that the legislature intended 
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to exclude the occasional seller.  The public policy rationale that supports the imposition 
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of particularized burdens upon manufacturers of products evinces an intent to allocate the 
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costs of accidental injuries caused by defective products intended for resale upon those 
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who launch such products into the marketplace.  Such manufacturers are expected to 
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stand behind their product and may insure against this potential liability and treat the 
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same as a cost of production.  See Comments c and f to Section 402A of the Restatement 
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of Torts 2d, supra, at 349-351.  Such policy considerations are clearly inapplicable to an 
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occasional seller, by whom sale of a product is isolated and merely incidental to the 
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business in which it is engaged. 
19 
 
The unrebutted evidence placed before the trial court was that Marathon designed 
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the VRS unit in question solely for use at four bulk plants owned and operated by 
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Marathon.  No evidence was before the trial court that Marathon ever sold or offered the 
1 
VRS unit or VRS design for sale other than in connection with a sale or disposition of the 
2 
bulk plants wherein the VRS unit originally had been installed.  In the absence of any 
3 
evidence demonstrating that Marathon’s design, construction and eventual sale of the 
4 
VRS unit to Keneco was anything but incidental to an occasional bulk sale of one of its 
5 
plants, I believe that the majority’s further analysis related to Marathon’s asserted liability 
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under R.C.  2307.71 through 2307.80 is unwarranted. 
7 
 
Accordingly, I would affirm the appellate court’s opinion in all respects. 
8 
 
MOYER, C.J., and WRIGHT, J., concur in the foregoing dissenting 
9 
opinion. 
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