Opinion ID: 1355684
Heading Depth: 1
Heading Rank: 2

Heading: strict liability and warranty

Text: By complaint and amended complaint, appellant asserted causes of action against appellees on the basis of strict liability in tort and upon the implied warranties of merchantability and fitness for a particular purpose. [5] The district court granted summary judgment in favor of appellees on both of these theories of recovery. [6] In granting summary judgment on the strict liability claims, the district court found that strict liability was applicable to lease transactions but that assumption of the risk was a complete and absolute defense to a cause of action premised on strict liability and that appellant's admitted knowledge of the alleged defect was sufficient to establish assumption of the risk. Regarding the implied warranties, the district court found that the warranties only attach to a sale transaction and they, therefore, were inapplicable to the nonsale transaction involved in this case. These determinations by the district court raise a number of issues of first impression in Wyoming, most of which emanate from our recent adoption of strict liability in tort as a valid cause of action, Ogle v. Caterpillar Tractor Co., 716 P.2d 334 (Wyo. 1986), and particularly in relation to the interplay of that doctrine, and actions founded on warranty, with Wyoming's comparative negligence statute. [7] We are not necessarily convinced that the district court properly resolved all of these issues. We conclude, however, that we need not reach them in this case and that the summary judgment should be affirmed because the findings regarding proximate cause made by the jury in the negligence action collaterally estop appellant from relitigating this critical question of fact, common to all appellant's theories of recovery, in a subsequent proceeding. A similar disposition was reached in the case of Hurley v. Beech Aircraft Corporation, 355 F.2d 517 (7th Cir.), cert. denied 385 U.S. 821, 87 S.Ct. 48, 17 L.Ed.2d 59 (1966), a case decided under Indiana law. In that case, the plaintiffs, as personal representatives of decedents killed in an airplane crash, brought an action against the aircraft manufacturer premised on negligence and breach of implied warranties. The district court dismissed the warranty claim for lack of privity of contract. The case was thereafter tried to the court solely on negligence, and the court entered judgment for the defendant, finding, inter alia, a lack of defect in the airplane. The plaintiffs appealed only the judgment dismissing their warranty claim. On appeal, the Seventh Circuit noted that, subsequent to the district court's ruling on the plaintiffs' warranty claim, it had held in another case that privity of contract was not essential to an implied warranty claim in Indiana. Thus, the district court's dismissal of the plaintiffs' warranty claim was error. The Seventh Circuit further observed, however, that proof of defect was essential to both of the plaintiffs' causes of action and that the district court had determined that question of fact adversely to the plaintiffs in the negligence judgment from which they did not appeal. The court held, therefore, that the plaintiffs were barred from proceeding under the warranty count under the doctrine of collateral estoppel by judgment. The court concluded that, although the dismissal of the warranty claim was erroneous, it was not prejudicial to the plaintiffs. Id. at 522. The Hurley court elaborated on the doctrine of estoppel by judgment in the following passage from that opinion: Yates v. United States, 354 U.S. 298, 335-336, 77 S.Ct. 1064, 1085-1086, 1 L.Ed.2d 1356 (1957) is also pertinent: We agree    that the nonexistence of a fact may be established by a judgment no less than its existence; that, in other words, a party may be precluded under the doctrine of collateral estoppel from attempting a second time to prove a fact that he sought unsuccessfully to prove in a prior action.      . That doctrine [collateral estoppel] makes conclusive in subsequent proceedings only determinations of fact, and mixed fact and law, that were essential to the decision. Later in the same opinion, the court makes the following statement: The normal rule is that a prior judgment need be given no conclusive effect at all unless it establishes one of the ultimate facts in issue in the subsequent proceeding. Id. at 338, 77 S.Ct. at 1087. We have held that even if a subsequent action is a different cause of action, a right, question, or fact determined in the prior action must, as between the same parties, be taken as conclusively established, so long as the judgment in the prior action remains unmodified. Id. at 522. In a more recent case, LaVay Corporation v. Dominion Federal Savings & Loan Association, 830 F.2d 522 (4th Cir.1987), cert. denied ___ U.S. ___, 108 S.Ct. 1027, 98 L.Ed.2d 991 (1988), the Fourth Circuit reached a similar result with respect to one of the issues raised by the plaintiffs' cross-appeal in that case. The plaintiffs in LaVay Corporation asserted several claims against the defendants, including actual and constructive fraud and violation of the Racketeer Influenced and Corrupt Organizations Act (RICO). The district court dismissed the RICO claim, and the fraud claims were resolved in favor of the various defendants by dismissal, jury verdict, and judgment notwithstanding the verdict. The fraud determinations were not appealed by the plaintiffs. One of the plaintiffs did prevail upon a claim of breach of fiduciary duty against one of the defendants. In reviewing the dismissal of the RICO claim, the Fourth Circuit cited Hurley and said that it did not need to reach the issue of whether the dismissal was appropriately granted on the ground relied upon by the district court, i.e., that predicate acts of mail fraud failed to establish a pattern of racketeering activity, because the plaintiffs were now precluded from asserting acts of fraud due to their resolution in the district court and, therefore, the plaintiffs' one surviving claim, a single breach of fiduciary duty, would not support a RICO claim requiring proof of a pattern of racketeering activity. See also Lewis v. Baker, 243 Or. 317, 413 P.2d 400 (1966) [8] (citing Hurley and holding that trial court's withdrawal of warranty issue was not reversible error where an element of the warranty claim was resolved against plaintiff by jury verdict on negligence claim, which verdict the court therein affirmed). In accordance with the aforementioned cases, we conclude that the doctrine of collateral estoppel by judgment is an appropriate basis upon which to affirm the district court's grant of summary judgment on appellant's strict liability and warranty claims. The jury, by its verdict in this case, clearly determined that Elizabeth Fiedler's negligent running through a stop sign was the entire proximate cause of the accident. [9] Proof of proximate cause is as necessary under warranty and strict liability causes of action as it is in a negligence action. 1 Am.Law Prod.Liab.3d, Proximate Causation § 4:3 (1987). Here, the fact question of proximate cause, or more precisely cause in fact, [10] was determined against appellant in the trial of his negligence claim. Although, as opposed to the Hurley case, appellant has appealed the negligence determination, we herein have affirmed the district court on that claim and that judgment is now just as conclusive as if it had not been appealed. Under the circumstances, therefore, we need not determine whether or not the district court properly granted summary judgment on appellant's warranty and strict liability claims because, even if the grant of summary judgment was erroneous, and we do not imply that it was, an essential element of those causes of action has been conclusively established adversely to appellant, and any error in granting summary judgment was not prejudicial to appellant due to the bar of collateral estoppel by judgment. Affirmed. BROWN, J. (Retired), files a specially concurring opinion.