Opinion ID: 2544284
Heading Depth: 1
Heading Rank: 3

Heading: Strict Products Liability of Component Manufacturers

Text: Citing La Jolla Village, supra, 212 Cal.App.3d 1131, 261 Cal.Rptr. 146, defendant window manufacturers contend that because they merely supplied component parts (the windows) of mass-produced homes, not the completed homes themselves, they should not be subject to strict products liability. They argue that extending strict products liability to component manufacturers would not serve the purposes of strict products liability. We disagree. The policies underlying strict products liability in tort, restated in our decision in Vandermark, supra, 61 Cal.2d 256, 37 Cal. Rptr. 896, 391 P.2d 168, are equally applicable to component manufacturers and suppliers. Like manufacturers, suppliers, and retailers of complete products, component manufacturers and suppliers are an integral part of the overall producing and marketing enterprise, may in a particular case be the only member of that enterprise reasonably available to the injured plaintiff, and may be in the best position to ensure product safety. ( Id. at p. 262, 37 Cal.Rptr. 896, 391 P.2d 168.) And component manufacturers and suppliers, like manufacturers, suppliers, and retailers of complete products, can adjust the costs of liability in the course of their continuing business relationship with other participants in the overall manufacture and marketing enterprise. ( Id. at pp. 262-263, 37 Cal.Rptr. 896, 391 P.2d 168.) For purposes of strict products liability, there are no meaningful distinctions between, on the one hand, component manufacturers and suppliers and, on the other hand, manufacturers and distributors of complete products; for both groups, the overriding policy considerations are the same. ( Kriegler v. Eichler Homes, Inc., supra, 269 Cal.App.2d at p. 227, 74 Cal.Rptr. 749.) Defendant window manufacturers here argue that subjecting them to strict liability would be improper because they had no physical control over the windows at the time of the alleged harm. In support, they cite Preston v. Goldman (1986) 42 Cal.3d 108, 227 Cal.Rptr. 817, 720 P.2d 476. But that case is distinguishable. At issue there was the negligence liability of a former landowner for a dangerous property condition that caused injury after the land was sold. ( Id. at p. 110, 227 Cal.Rptr. 817, 720 P.2d 476.) It did not involve strict liability for defects in mass-produced homes ( id. at p. 117, 227 Cal.Rptr. 817, 720 P.2d 476), which is at issue here. In any event, we have never held or implied that strict products liability applies only to those injuries that defective products cause while still under the manufacturer's ownership or control. Rarely, if ever, are defective products still in the control of a manufacturer, distributor, or retailer at the time of injury to the consumer. What matters is whether the windows were defective when they left the factory, and whether these defects caused the alleged injuries. (See Wiler v. Firestone Tire & Rubber Co. (1979) 95 Cal.App.3d 621, 629, 157 Cal.Rptr. 248; Rest.3d Torts, Products Liability, § 5; id., § 19, com. b, p. 268.) Insisting that they should not be held strictly liable, defendant window manufacturers point out that their windows are shipped in parts, assembled by others, and installed by others. They rely on language in subdivision (l)(b) of section 402A of the Restatement Second of Torts. That subdivision says that the seller of a defective product is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if [¶] ... [¶] (b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.  (Italics added.) The mere assembly of a product that is sold in parts is not a substantial change in the product within the meaning of the Restatement. The issue is not whether the product was sold fully assembled or in parts, but rather whether the defect that resulted in the alleged damage existed when the windows left the manufacturers' control. To the extent defendants argue that any defect in their windows resulted from improper assembly or installation, their argument is not properly before us here. A motion for summary adjudication may be granted only if there is no triable issue of material fact. (Code Civ. Proc., § 437c, subd. ( o )(1).) Defendants' motion for summary adjudication did not rely on a claim of improper assembly or installation. Defendant window manufacturers argue that to subject them to strict liability would nullify the California Legislature's intent when it enacted Code of Civil Procedure section 337.15. This statute requires that an action for damages based on latent deficiencies against any person who develops real property or performs or furnishes the design, specifications, surveying, planning, supervision, testing, or observation of construction be brought within 10-years after substantial completion of the development. ( Ibid. ) Defendants acknowledge that, as they are not developers, do not furnish designs or specifications, and do not supervise construction, the statute does not apply to them. Nevertheless, they assert that if they (or other component manufacturers in other lawsuits) are ultimately held strictly liable for defects in component parts of mass-produced homes, they might then seek equitable indemnity from developers or designers of the homes, thereby subjecting those developers or designers to liability for defects in their homes in suits brought after expiration of the 10 year statutory limitation period. We do not consider this argument because defendants did not raise it in the trial court, in the Court of Appeal, or in their petitions for review by this court. Finally, defendant window manufacturers contend that applying strict liability to them would open the litigation floodgates. They predict a massive increase in litigation as manufacturers and distributors of component products used in the mass production of homes bring actions and cross actions against each other for indemnity and other claims. We are not convinced. The same dire predictions were made in response to the original development of strict products liability. As we have explained, the policy reasons favoring strict products liability for component manufacturers are the same as for other participants in the general enterprise of manufacturing and marketing consumer goods, and these interests, including the incentives for improved product safety, outweigh the burden imposed by increased litigation. Accordingly, we hold that the manufacturers of component parts, here windows, that are installed in mass-produced homes can be subject to strict products liability in tort when their defective products cause harm. [1] We now consider defendants' contention that the particular injuries for which plaintiffs here seek recovery are barred by the economic loss rule.