Court Opinion

ID: 1003864
Source: CourtListenerOpinion
Date Created: 2013-07-04 18:32:40.131933+00
Date Added: 2024-06-11T12:38:55.023117
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS
                FOR THE FOURTH CIRCUIT

FREDERICK A. LEWIS,                    
                Plaintiff-Appellant,
                 v.
WELDOTRON CORPORATION; KAISER                   No. 99-2216
ALUMINUM AND CHEMICAL
CORPORATION, d/b/a Kaiser
Refractories,
              Defendants-Appellees.
                                       
           Appeal from the United States District Court
            for the District of Maryland, at Baltimore.
             J. Frederick Motz, Chief District Judge.
                        (CA-98-1466-JFM)

                      Argued: November 3, 2000

                      Decided: March 12, 2001

       Before NIEMEYER and KING, Circuit Judges, and
   Margaret B. SEYMOUR, United States District Judge for the
        District of South Carolina, sitting by designation.

Affirmed by unpublished opinion. Judge Seymour wrote the opinion,
in which Judge Niemeyer and Judge King joined.

                            COUNSEL

ARGUED: John Robert Sutherland, SUTHERLAND & BRINSTER,
P.A., Baltimore, Maryland, for Appellant. Michael Thomas Wharton,
2                LEWIS v. WELDOTRON CORPORATION
WHARTON, LEVIN, EHRMANTRAUT, KLEIN & NASH, P.A.,
Annapolis, Maryland, for Appellee Kaiser; William N. Zifchak,
SASSCER, CLAGETT & BUCHER, Upper Marlboro, Maryland, for
Appellee Weldotron. ON BRIEF: Kristen A. Brinster, SUTHER-
LAND & BRINSTER, P.A., Baltimore, Maryland, for Appellant.

Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

                             OPINION

SEYMOUR, District Judge:

   Frederick A. Lewis brought this action against Weldotron Corpora-
tion ("Weldotron") and Kaiser Aluminum and Chemical Corporation
("Kaiser"). Lewis’ claims stem from an injury in which his leg was
caught between the conveyors of a Weldotron shrink wrap machine
and amputated. Lewis alleges negligence, strict liability, and breach
of express and implied warranties with respect to the design and man-
ufacture of Weldotron’s shrink wrap machine and its associated con-
veyors. The district court granted summary judgment in favor of
Weldotron and Kaiser after determining they were immune from lia-
bility under Maryland’s Statute of Repose, Md. Code Ann., Cts. &
Jud. Proc. § 5-108(a) (1974, 1998 Repl. Vol.). Finding no error, we
affirm.

                                 I.

   In 1965, Kaiser acquired a brick manufacturing plant located in
Frostburg, Maryland. Pallets of brick and other refractory materials
manufactured at Kaiser’s plant were packaged manually by wrapping
the pallets with corrugated paper and steel bands. In an effort to
reduce costs and increase output, Kaiser purchased an automated
shrink wrap system in 1969. The system, which is comprised of a
shrink wrap machine and its associated conveyors, was designed and
manufactured by Weldotron.
                  LEWIS v. WELDOTRON CORPORATION                      3
   Kaiser used the shrink wrap system from June 24, 1969, until it
closed its plant in August 1980. On May 22, 1986, Mount Savage
Firebrick Company ("Mount Savage") purchased Kaiser’s brick man-
ufacturing plant and all of its equipment, including the shrink wrap
system. The system has operated continuously from May 1986 until
the present.

   On May 11, 1995, Lewis, who was employed by Mount Savage,
was assigned to operate the shrink wrap system. Lewis observed a
pallet of bricks wedged between two different sets of conveyors and
attempted to dislodge the pallet by pushing it. Lewis slipped while
pushing, trapping his leg in an unguarded opening between the con-
veyors. Lewis was unable to free his leg or turn off the shrink wrap
system. The weight of approaching pallets eventually amputated
Lewis’ left leg.

   Lewis filed a complaint in the United States District Court for the
District of Maryland on May 7, 1998. Lewis alleged negligence, strict
liability, and breach of warranty. The district court granted summary
judgment on all claims in favor of Weldotron and Kaiser on August
23, 1999.

                                  II.

   Lewis appeals the district court’s grant of summary judgment. The
specific issue on appeal is whether the district court erred in conclud-
ing that the shrink wrap system designed and manufactured by Wel-
dotron was an improvement to real property under Maryland’s Statute
of Repose, Md. Code Ann., Cts. & Jud. Proc. § 5-108(a) (1974, 1998
Repl. Vol.). We review the district court’s grant of summary judg-
ment de novo, applying the same legal standards as the district court
and viewing facts and reasonable inferences in the light most favor-
able to the nonmoving party. Binakonsky v. Ford Motor Co., 133 F.3d
281, 284-85 (4th Cir. 1998). Summary judgment is appropriate when
there is no genuine issue of material fact and the movant is entitled
to judgment as a matter of law. Id. at 285.

  Maryland’s Statute of Repose provides, in pertinent part:
4                  LEWIS v. WELDOTRON CORPORATION
        (a) Injury occurring more than 20 years later. — Except
     as provided by this section, no cause of action for damages
     accrues and a person may not seek contribution or indem-
     nity for damages incurred when wrongful death, personal
     injury, or injury to real or personal property resulting from
     the defective and unsafe condition of an improvement to
     real property occurs more than 20 years after the date the
     entire improvement first becomes available for its intended
     use.

Md. Code Ann., Cts. & Jud. Proc. § 5-108(a). The statute of repose
precludes all actions that meet two requirements: "(1) the plaintiff’s
injuries must have resulted from the alleged defective and unsafe con-
dition of ‘an improvement to real property’; and (2) 20 years must
have passed since the ‘entire improvement first bec[ame] available for
its intended use.’" Rose v. Fox Pool Corp., 335 Md. 351, 360, 643
A.2d 906, 910 (1994) (quoting § 5-108(a)). Furthermore, Maryland’s
Statute of Repose applies to claims against manufacturers of any
product other than those containing asbestos. Id. at 374, 643 A.2d at
917; see also First United Methodist Church v. United States Gypsum
Co., 882 F.2d 862, 865 (4th Cir. 1989), cert. denied, 493 U.S. 1070
(1990).

   Because Weldotron manufactured the shrink wrap system at issue
in this case, § 5-108(a) is applicable. The parties agree that more than
twenty years have passed since the shrink wrap system first became
available for its intended use, June 24, 1969, and the date of Lewis’
injury, May 11, 1995. Accordingly, the dispositive issue is whether
the shrink wrap system is "an improvement to real property."

  The district court determined that, because the system was an
improvement to real property, Weldotron was entitled to protection
under the statute of repose. On appeal, Lewis argues that the district
court erred in failing to find that the shrink wrap system is personal
property, thereby falling outside the ambit of § 5-108(a). We dis-
agree.*

  *Because we conclude that Weldotron falls within the protection of
§ 5-108(a) and, therefore, cannot be held liable for Lewis’ injuries, Kai-
ser, as a former plant owner, also is protected by the statute of repose,
owing no duty to Lewis as the employee of a subsequent purchaser of the
plant and the shrink wrap system.
                  LEWIS v. WELDOTRON CORPORATION                      5
   Section 5-108 does not define "an improvement to real property."
Moreover, there is no legislative history explaining the term. In fact,
other than the present case, we are aware of only two Maryland cases
that have interpreted the meaning of § 5-108(a). These two cases are
Rose and Allentown Plaza Assoc. v. Suburban Propane Gas Corp., 43
Md. App. 337, 405 A.2d 326 (1979).

   The Rose court acknowledged that, for purposes of applying a stat-
ute of repose, there are two general approaches to determine whether
an object constitutes "an improvement to real property." Rose, 335
Md. at 375, 643 A.2d at 918; see also Allentown, 43 Md. App. at 344,
405 A.2d at 331. The first approach is a common law fixture analysis.
Rose, 335 Md. at 375, 643 A.2d at 918. Under a fixture analysis, a
court must look at the "degree of annexation and the physical size of
the object to determine whether a particular object qualifies as an
‘improvement to real property.’" Id. The second approach, which the
majority of courts utilize, is a "common sense" or "common usage"
analysis. Id. at 375-76, 643 A.2d at 918 (citing Allentown, 43 Md.
App. at 345, 405 A.2d at 331). The relevant inquiry under this analy-
sis "is whether the object is an improvement within the common, dic-
tionary meaning of that term." Id.

  Adopting the "common sense" approach, the Rose court turned to
Black’s Law Dictionary for a definition of "improvement." Id.
Black’s defines improvement as:

    A valuable addition made to property (usually real estate) or
    an amelioration in its condition, amounting to more than
    mere repairs or replacement, costing labor or capital, and
    intended to enhance its value, beauty or utility or to adapt
    it for new or further purposes. Generally has reference to
    buildings, but may also include any permanent structure or
    other development, such as a street, sidewalks, sewers, utili-
    ties, etc. An expenditure to extend the useful life of an asset
    or to improve its performance over that of the original asset.
    Such expenditures are capitalized as part of the asset’s cost.

Black’s Law Dictionary 757 (6th ed. 1990). In addition to the com-
mon usage of the term "improvement," the Rose court noted that com-
mon sense dictates the following factors also should be considered
6                 LEWIS v. WELDOTRON CORPORATION
when making a case by case determination as to whether an object is
"an improvement to real property" within the purview of § 5-108(a):
(1) the nature of the addition or betterment; (2) its permanence and
relationship to the land and its occupants; and (3) its effect on the
value and use of the real property. Id. at 376-77, 643 A.2d at 918; see
also Allentown, 43 Md. App. at 346, 405 A.2d at 332.

   In the present case, little doubt exists that the shrink wrap system
was a valuable addition to the Kaiser plant. The deposition testimony
of Lawrence Kessler, Kaiser’s Chief Industrial Engineer, and John
Stevens, Kaiser’s General Foreman, indicates that the system was
purchased to reduce the costs of packaging and shipping refractory
products. Similarly, the system significantly increased production.
The addition of the system in 1969 was not made to repair or replace
an existing shrink wrap system, but instead represented a cheaper,
faster method of packaging bricks at Kaiser. Moreover, the shrink
wrap system required labor to be assembled and was capitalized.
Employees from both Kaiser and Weldotron spent weeks assembling
the system that cost several thousands of dollars to purchase. Because
the system offered a number of benefits to Kaiser, including a more
cost-effective and better packaged product, the system clearly
enhanced the value and utility of the real property on which it was
located. Overall, the system embodied a new and innovative means
to further the purposes of Kaiser, i.e., the manufacture of refractory
products. Thus, the shrink wrap system meets the definition of "im-
provement" found in Black’s Law Dictionary.

   We next turn our attention to the additional three factors set forth
in Rose. In this case, the system is attached to the real property, and
the facts establish that Kaiser intended the system to become a part
of its everyday manufacturing process. Even today, the two conveyor
belts, the oven assembly, and the component motors are bolted to the
concrete floor of the plant. Stabilizing angle irons are welded to the
conveyors and bolted to the floor. Steel guards are mounted in the
floor to protect the drive motors from being struck by forklift trucks.
The oven control panel is hard wired into the plant’s electrical system.
Attached pipes deliver natural gas necessary for the operation of the
system from the plant to the shrink wrap machine.

   Lewis argues that the shrink wrap system is not permanent because
a trained individual could remove the system from its location within
                  LEWIS v. WELDOTRON CORPORATION                     7
three days. However, if the system were removed, there would be
numerous holes left in the concrete floor from the anchoring bolts.
Similarly, the three-inch diameter gas lines would need to be capped
off where they had been connected to the system.

   Mount Savage continues to use the shrink wrap system as it was
originally installed over thirty years ago. The system enhances the
value of the premises. According to Robert Rost, President of Mount
Savage, the system is an integral part of the brick manufacturing pro-
cess. Thus, the system satisfies the criteria enunciated in Rose. We
conclude that the shrink wrap system constitutes an "improvement to
real property" within the meaning of § 5-108.

   Lewis asserts that the Agreement of Sale between Kaiser and
Mount Savage is important in our analysis of whether the shrink wrap
system is an improvement within the scope of § 5-108(a). Specifi-
cally, paragraph 17 of the Agreement of Sale states: "It is agreed that
this Sale includes all machinery and all other personal property owned
by [Kaiser] on the Premises. . . ." Lewis construes this contractual
language to mean that Kaiser considered the shrink wrap system to be
merely personal property and not an improvement to real property.
However, the classification of the shrink wrap system as personal
property in the Agreement of Sale is inconsequential. It is for the
court to decide as a matter of law whether the system is an improve-
ment to real property. Accord Adair v. Koppers Co., 741 F.2d 111,
114 (6th Cir. 1984) (testimony of plaintiff’s expert that a product was
not an "improvement to real property" was irrelevant since only a
court can make that determination as a matter of law); Stone v. United
Eng’g, 197 W. Va. 347, 357, 475 S.E.2d 439, 449 (1996) (classifica-
tion of a product as either personal property or real property in an
asset purchase agreement is irrelevant since the determination as to
whether a particular product is an "improvement to real property" for
purposes of the statute of repose is a question of law for the court);
Krull v. Thermogas Co., 522 N.W.2d 607, 611 (Iowa 1994) (liquid
propane furnace gas control valve was "improvement to real property"
within the meaning of the statute of repose despite contentions that
the valve fell within the definition of goods under Iowa’s Uniform
Commercial Code); Rose, 335 Md. at 375, 643 A.2d at 917-18 (classi-
fication of a product as a consumer good is not dispositive with
respect to the question of whether a product may be considered an
8                  LEWIS v. WELDOTRON CORPORATION
"improvement to real property" within the meaning of the statute of
repose). The language contained in the Agreement of Sale does not
persuade us to alter our conclusion that the shrink wrap system is an
improvement to real property.

    Lewis also directs our attention to four cases, each from a different
jurisdiction, which he argues support his position that the system
should not be classified as an improvement to real property. However,
as the district court aptly pointed out, each of the cases cited by Lewis
is distinguishable from the case at bar. In Ritter v. Abbey-Etna Mach.
Co., 483 N.W.2d 91, 93-94 (Minn. Ct. App. 1992), the Minnesota
Court of Appeals determined that the state’s statute of repose did not
"include manufacturers of production machinery where the machinery
. . . is not integral to and incorporated into the design of the building."
Similarly, in Condit v. Lewis Refrigeration Co., 101 Wash. 2d 106,
111, 676 P.2d 466, 468 (1984), the Supreme Court of Washington
concluded that Washington’s Statute of Repose was not so broad as
to include "manufacturers of heavy equipment or nonintegral systems
within [a] building." Both the Minnesota and Washington Statutes of
Repose are distinguishable from Maryland’s statute, which expressly
includes manufacturers. The Rose court acknowledged this difference.
Lewis’ reliance on Ritter and Condit is misplaced.

   Lewis further argues that Beals v. Superior Welding Co., 273 Ill.
App. 3d 655, 653 N.E.2d 430, appeal denied, 164 Ill. 2d 558, 660
N.E.2d 1265 (1995), is persuasive. In Beals, however, the court
defined an "improvement" as an object which does not have "an iden-
tity separate from the overall system or building in which it is
located." Id. at 662, 653 N.E.2d at 435. While the Beals court listed
several of the same factors as those articulated in Rose for determin-
ing whether an object is an improvement to real property, the underly-
ing notion of what constitutes an improvement in Maryland greatly
differs from that of Illinois. Maryland case law makes no distinction
as to the identity of a putative improvement. The object is either an
improvement or it is not. We have found no indication that the courts
of Maryland are concerned with whether an object has "an identity
separate from the overall system or building in which it is located."
Therefore, Beals is distinguishable.

  Finally, Lewis refers to Ilich v. John E. Smith Sons Co., 145 N.J.
Super. 415, 367 A.2d 1216 (1976). In Ilich, the court utilized a fixture
                  LEWIS v. WELDOTRON CORPORATION                     9
analysis when determining that the manufacturer of a machine was
not protected by New Jersey’s Statute of Repose. Id. at 418-19, 367
A.2d at 1218. However, as discussed above, the Rose court explicitly
rejected a fixture analysis and opted for a common sense approach,
which is now the test in Maryland. Thus, Ilich also is distinguishable.

                                 III.

   For the reasons stated above, we conclude that the shrink wrap sys-
tem at issue in this case is "an improvement to real property" within
the meaning of Maryland’s Statute of Repose, Md. Code Ann., Cts.
& Jud. Proc. § 5-108(a). Accordingly, we affirm the decision of the
district court.

                                                          AFFIRMED