Court Opinion

ID: 9566283
Source: CourtListenerOpinion
Date Created: 2023-08-21 19:36:06.629066+00
Date Added: 2024-06-11T09:35:33.334802
License: Public Domain

ALMA WILSON, Justice,
dissenting:
I respectfully dissent to the majority opinion in this cause for two reasons. First, even with today’s restriction on the tort theory of manufacturers’ products liability to claims for loss of “other property” or injury to persons, in my opinion, the entire record convincingly supports the jury verdict in favor of the plaintiffs and the harmless error doctrine is applicable. Second, neither Kirkland v. General Motors Corporation, 521 P.2d 1353 (Okla.1974) nor our subsequent decisions require a specific kind of damages as a prerequisite to a claim of manufacturers’ products liability nor limit damages recoverable under the theory of manufacturers’ products liability.
*657In June, 1979, plaintiffs purchased the subject mobile home for $22,800.00. Subsequent to the purchase, chronic and continuous internal condensation of liquid vapor accumulated into pools of water within the structure and leaked into the interior of the mobile home. Upon notifying the retail dealer of the leaks, the manufacturer attempted several unsuccessful “cures.” The energy saving design caused the condensation, which could not be corrected. The manufacturer’s last attempted cure and the continuous condensation over time rendered the mobile home uninhabitable. Neither the dealer nor the manufacturer would replace the mobile home.
After enduring more than four years of difficulties caused by the defectively designed mobile home, this suit was initiated against the dealer and the manufacturer. Plaintiffs’ amended petition alleged defective design, breach of implied warranty of habitability, misrepresentation and harassment. Plaintiffs sought damages in the amount of $30,000.00 for replacement of the defective mobile home and exemplary damages in the amount of $50,000.00. The ease was tried to the jury. The jury was instructed on the elements of manufacturers’ products liability. The jury returned a verdict in favor of plaintiffs and against the manufacturer for $22,800.00 actual damages and $7,200.00 punitive damages.
In my opinion, the overwhelming evidence supports plaintiffs’ claim of $30,-000.00 damages for replacement of the uninhabitable, defectively designed mobile home. The evidence established that the manufacturer’s design was defective and that the defect could not be corrected by the manufacturer. Deterioration in the mobile home was certain under these circumstances, but the evidence demonstrates more than mere deterioration. There is evidence which supports a finding by the jury that the defectively designed mobile home was “unreasonably dangerous”, as well as a finding that it was uninhabitable: the defective design caused pools of water to accumulate about the electrical wiring of the mobile home. The evidence establishes the manufacturer’s defective design and the plaintiffs’ right to replacement damages from the manufacturer, whether the evidence as a whole is examined for necessary elements of manufacturers’ products liability, the manufacturer’s negligence, or the manufacturer’s implied warranty of habitability.
This Court has consistently held that a judgment must be affirmed if it is sustainable on any legal or equitable theory, regardless of the reasons given by the trial court in support of the pronouncement, Utica National Bank & Trust v. Assoc. Prod, and City of Lawton, 622 P.2d 1061, 1062 (Okla.1981), and, if there is any competent evidence or reasonable inferences from the evidence tending to support the verdict. Kelley-Webb Realty Co. v. Allen, 199 Okl. 503, 187 P.2d 986, 987 (1948). The judgment in this cause is supported by the evidence and it is sustainable on the theory of manufacturers’ products liability.
The harmless error doctrine, codified at 20 O.S.1981, § 3001.1, requires an appellate court to affirm a jury verdict challenged on the ground of misdirection, unless the erroneous jury instruction has resulted in a miscarriage of justice or constitutes a substantial violation of a fundamental constitutional or statutory rights of the adverse party. Where the instruction directs the jury on legal theories not applicable to the cause, the error will be deemed harmless unless from the record as a whole the instruction resulted in a miscarriage of justice. Erroneous instructions on contributory negligence and assumption of risk were harmless where the entire record revealed no miscarriage of justice in Kirkland, 521 P.2d at 1367. Res ipsa loquitor instruction was harmless upon examination of the entire record in Seay v. General Elevator Company, 522 P.2d 1022, 1028 (Okla.1974). And, proximate cause instruction did not constitute reversible error unless it is reasonably certain that the jury was misled thereby, Fields v. Volkswagen of America, Inc., 555 P.2d 48, 57 (Okla.1976). The harmless error doctrine should be applied to preserve the jury verdict notwithstanding the instruction, particularly where, as in this case, this Court pronounc*658es a new rule of law governing the correctness of that instruction.
In Fields v. Volkswagen of America, Inc., this Court approved bifurcation of the issues of liability and damages in a manufacturers’ products liability action, implicitly recognizing that liability did not hinge on allegation or proof of a particular kind of damage. In Thiry v. Armstrong World Industries, 661 P.2d 515 (Okla.1983), this Court held that exemplary and punitive damages may be alleged and proved as an element of damages in a manufacturers’ products liability case because products liability is clearly within the statutory scope of a tort action. Damages recoverable in a tort action are the amount which will compensate for all detriment proximately caused by the breach of an obligation not arising out of contract. 23 O.S.1981, § 61,.
In fashioning the manufacturers’ products liability theory of recovery of damages caused by defective products, in Kirkland v. General Motors Corporation, 521 P.2d 1353, 1362 (Okla.1974), this Court did not limit the recovery of damages under the new common law tort theory. Rather, we said that a products liability action is a tort action for injury to personal property or injury to rights of another, Kirkland, 521 P.2d at 1361, and that manufacturers’ products liability theory retains the broad protection from defective products previously adopted by the Court, Kirkland, 521 P.2d at 1366. Following the rationale in the concurring opinion in Escola v. Coca-Cola Bottling Co., 24 Cal.2d 453, 150 P.2d 436 (1944), Kirkland held that it is no longer necessary to rely upon theories of negligence or warranty for recovery of damages caused by defective products, Kirkland, 521 P.2d at 1362, and that breach of implied warranty is no longer appropriate for products liability except as provided by the U.C.C., citing the concurrent opinion in Moss v. Polyco, Inc., 522 P.2d 622, 626 (Okla.1974). In Moss we said that under the theory of manufacturers’ products liability a plaintiff may recover all damages which were the reasonable consequence of the defective article to the same extent allowed in a negligence action. The Escola concurring opinion rationale quoted in Kirkland, in summary, is that the marketing of defective products is a constant and general risk to the public no matter how intermittent or haphazard injury therefrom may occur; public interest compels deterrence of marketing of defective products; and, the manufacturer should be responsible for whatever injury may occur because of the marketing of defective products. Kirkland, 521 P.2d at 1361.
Nowhere in our prior manufacturers’ products liability decisional law has this Court limited the right to maintain a claim of manufacturers’ products liability by the kind of damages sought. The underlying public policy and the theory focus on the duty of the manufacturer not to market defective products. Personal harm or other property harm is not a required element of the theory. However, where fortuitously the defective product has only caused harm to itself, today’s pronouncement denies the plaintiff the right to maintain a manufacturers’ products liability action, requiring the plaintiff to return to the breach of implied warranty fiction for recovery of damages under the U.C.C.
Declaring the implied warranty theory inappropriate in Kirkland, this Court in Moss discussed U.C.C. restriction on the damages for whatever injury may be claimed in the manufacturers’ products liability action:
Assuming the non-existence of a valid contract between the plaintiff and a defendant which could possibly, under the terms of the UCC, affect the right of the plaintiff to recover for certain losses, we are of the view that a plaintiff who has suffered damages by reason of a defectively manufactured article may recover under the doctrine of Manufacturers’ Product Liability all of the damages which were the reasonable consequences of the defective article to the same extent as if the plaintiff’s action was based upon negligence. Should a contract, valid under the UCC limiting plaintiff’s right to recover damages for certain items of damage exist however, we know of no reason why such contract could not be given consideration in the same action *659in which plaintiff seeks recovery under the doctrine of Manufacturers’ Product Liability when the two matters are clearly distinguished by proper instructions. Moss, 522 P.2d at 626.
There is no contract between the manufacturer and the plaintiffs in this cause. In the pretrial proceedings, the manufacturer denied any implied warranty of habitability. The single jury instruction on manufacturers’ products liability in this cause is appropriate under the “broad protection” expressed in Kirkland and the U.C.C. damages limitation defense set out in Moss.
Neither allegation nor proof of injury to person or other property is a prerequisite to assertion of the theory of manufacturers’ product liability. The delineated elements to be alleged and established by the evidence of the plaintiff do not include any specific kind of injury or loss:
First of all Plaintiff must prove that the product was the cause of the injury: the mere possibility that it may have caused the injury is not enough.
Secondly, Plaintiff must prove that the defect existed in the product, if the action is against the manufacturer, at the time the product left the manufacturer’s possession and control....
Thirdly, Plaintiff must prove that the defect made the article unreasonably dangerous to him or to his property as the term “unreasonably dangerous” is above defined.
And,
We adopt the standard of proof for Oklahoma set forth by the Restatement Second § 402A comment g and define “unreasonably dangerous” as follows:
“The article sold must be dangerous to an extent beyond that which would be contemplated by the ordinary consumer who purchases it, with the ordinary knowledge common to the community as to its characteristics.”
We specifically disapprove of the standard of proof adopted by Cronin v. J.B.E. Olson Corporation, 8 Cal.3d 121, 104 Cal.Rptr. 433, 501 P.2d 1153 (1972). Kirkland, 521 P.2d at 1362-1363.
Satisfying these elements, but without allegation or proof of damage to person or property other than the defectively designed mobile home, such as a sinus ailment aggravated by the mold in the damp infrastructure or water marks on a piece of furniture inside the mobile home, the majority opinion denies the plaintiffs any right to a manufacturers’ products liability tort remedy. In so doing, the majority opinion characterizes plaintiffs’ injury or loss to be only deterioration of the product or diminution in bargained for expectations or “economic loss” damages.
The majority relies upon the reasoning in the recent opinion of the United States Supreme Court in East River Steamship Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 106 S.Ct. 2295, 90 L.Ed.2d 865 (1986) in denying plaintiffs’ right to recover in tort. In East River, the Court held that an admiralty common law products liability action may not be maintained for recovery of economic loss caused by a defective product. The Court noted that protection of fishermen is the underlying policy of the admiralty common law strict liability action, which is not implicated in the action. The Court further noted that the defective rings were corrected by the manufacturer and that the loss of business or loss of profit during the time the ships were down is more appropriately settled under the commercial code of the applicable state having jurisdiction over the involved commercial contracts. East River did not proscribe recovery of the damages to a defective product in an admiralty strict liability action. It refused to recognize such a right under the pretrial proceedings before it.
The issue of whether economic loss damages may be recovered in a manufacturers’ products liability action has been considered under the laws of at least thirty-one state jurisdictions. In deciding the issue, the courts have considered the nature and circumstance of the injury to the defective product; the underlying policy for strict liability; the setting and status of the parties, individual or commercial; and, kind of damages, direct damage to the defective product and indirect damages such as loss *660of profits, salaries, or customers. Most of these cases are appeals from pretrial motions; most involve commercial parties and commercial transactions between commercial parties of equal bargaining power; and, most involve damages for loss of business profits as well as injury to the defective product. Review of these cases clearly indicates that this case is inappropriate for a determination of the recoverability of economic loss damages in a manufacturers’ products liability claim, especially where the jury verdict is supported by the record.
Nine states allow recovery of damages to the defective product under a tort theory of strict liability. The most similar fact situation is in Thompson v. Nebraska Mobile Homes Co., 198 Mont. 461, 647 P.2d 384 (1982), wherein plaintiff sought damages to a mobile home allegedly rendered unsuitable for living by the use of inferior building materials. Emphasizing policy considerations of the pronounced inequality in bargaining position, the doctrine of strict liability is extended to recovery of the damage for the loss of the defective product itself.
Two other states emphasize policy considerations for allowing recovery: Hiigel v. GM Co., 190 Colo. 57, 544 P.2d 983 (1975). Plaintiff sought recovery of damages to a motor home caused by allegedly defective wheel studs. The court found that limiting a manufacturer’s responsibility to property other than the product sold is inconsistent with the language of § 402A. C & S Fuel Inc. v. Clark Equipment Co., 524 F.Supp. 949 (E.D.Ky.1981). Plaintiff sought damages for loss of a tractor due to an alleged engine defect. Under Kentucky law, elements of a cause of action in tort for property damage loss differ from elements in contract and plaintiff may recover for damage to the defective product itself under tort law.
Three states allow tort recovery for economic loss if the defect in the product is considered dangerous: Northern Power & Engineering Co. v. Caterpillar Tractor Co., 623 P.2d 324 (Alaska 1981). Plaintiff sought damages to electrical generator caused by defective low oil pressure shutdown mechanism. Recovery allowed in strict liability in tort when the product creates a situation potentially dangerous to people or other property, even though damage is confined to the product itself. Russell v. Ford Motor Co., 281 Or. 587, 575 P.2d 1383 (1978). Plaintiff sought damages for allegedly defective axle on a truck. The loss that occurs must be a consequence of the kind of danger and must occur under circumstances that make the condition of the product a basis for strict liability, which does not include economic loss due to poor performance or reduced resale value of a dangerously defective product. And, Corporate Air Fleet of Tennessee, Inc. v. Gates Learjet, Inc., 589 F.Supp. 1076 (M.D.Tenn.1984). Plaintiff sought loss of use, reasonable rental value of replacement, and damages to a learjet which crash-landed. Under Tennessee law, if a defect makes the product unreasonably dangerous and the only damage is to the product itself then recovery may be allowed under strict liability.
Three states allow economic loss recovery upon a showing that the defect caused a sudden and calamitous occurrence, rather than deterioration, internal breakdown or nonaccidental harm to the product: Salt River Project Agricultural Improvement and Power District v. Westinghouse Electric Co., 143 Ariz. 368, 694 P.2d 198 (1984). Plaintiff sought $1.9 million for damage to turbine blades and $50,000 in lost profits and expenses. Recovery in strict liability for damage to the product itself is allowed if it occurs in a sudden, accidental manner and the defect is unreasonably dangerous to persons and other property. Moorman MFG. Co. v. National Tank Co., 91 Ill.2d 69, 61 Ill.Dec. 746, 435 N.E.2d 443 (1982). Plaintiff sought economic loss from a crack in a grain storage tank. Recovery of personal injury or property damage resulting from a sudden or dangerous occurrence is allowed in tort, but economic loss from nonaccidental causes is recoverable only under contract theories. And, Star Furniture Co. v. Pulaski Furniture Co., 297 S.E.2d 854 (W.Va.1982). Property damage to a defective product resulting from a *661sudden and calamitous event is recoverable in tort.
Twenty-two states deny recovery. Six of those states declare that tort recovery of economic loss has no place in a commercial setting and between commercial buyers and sellers: Spring Motors Distributors, Inc. v. Ford Motor Co., 98 N.J. 555, 489 A.2d 660 (1985). Plaintiff sought damages for defects in transmissions of commercial trucks resulting in needed repairs, towing, replacement parts, lost profits, and decreased value of the trucks. As far as commercial buyers are concerned, strict liability is not an appropriate basis for economic loss, such recovery is limited to individual consumers. See also Scandinavian Airlines System v. United Aircraft Co., 601 F.2d 425 (9th Cir.1979), applying California law that recovery under products liability does not apply between parties who are in a commercial setting, have similar economic strengths, bargain the specifications of a product and negotiate concerning the risk of loss; Dairyland Insurance Co. v. GM Co., 549 So.2d 44 (Ala.1989); McCarthy Well Co., Inc. v. St. Peter Creamery, Inc., 410 N.W.2d 312 (Minn.1987), finding economic loss arising out of a commercial transaction, except those involving personal injury or damage to other property are not recoverable under strict products liability; Chemtrol Adhesives, Inc. v. American Manufacturers Mutual Insurance Co., 42 Ohio St.3d 40, 537 N.E.2d 624 (1989); and, Rem Coal Co., Inc. v. Clark Equipment Co., 386 Pa.Super.Ct. 401, 563 A.2d 128 (1989).
Thirteen states refuse to extend the tort doctrine to economic loss where the damage is only to the defective product. Colonial Park Country Club v. Joan of Arc, 746 F.2d 1425 (10th Cir.1984) applying New Mexico law; Frey Dairy v. A.O. Smith Harvestore Products, Inc., 680 F.Supp. 253 (E.D.Mich.1988); County of Westchester v. General Motors Co., 555 F.Supp. 290 (S.D.N.Y.1983); Agristor Leasing v. Spindler, 656 F.Supp. 653 (D.S.D.1987); Wisconsin Power and Light v. Westinghouse Electric, 645 F.Supp. 1129 (W.D.Wis.1986); Florida Power and Light v. Westinghouse Electric Co., 510 So.2d 899 (Fla.1987); Clark v. International Harvester Co., 99 Idaho 326, 581 P.2d 784 (1978); Bay State-Spray & Provincetown Steamship, Inc., v. Caterpillar Tractor Co., 404 Mass. 103, 533 N.E.2d 1350 (1989); Sharp Brothers Contracting Co. v. American Hoist & Derrick Co., 703 S.W.2d 901 (Mo.1986); National Crane Co. v. Ohio Steel Tube Co., 213 Neb. 782, 332 N.W.2d 39 (1983); Local Joint Exec. Bd. of Las Vegas v. Stem, 98 Nev. 409, 651 P.2d 637 (1982); Ellis v. Morris, Inc., 128 N.H. 358, 513 A.2d 951 (1986); Hagert v. Hatton Commodities, Inc., 350 N.W.2d 591 (N.D.1984); Nobility Homes of Texas, Inc. v. Shivers, 557 S.W.2d 77 (Tex.1977); Washington Water Power v. Graybar Electric, 112 Wash.2d 847, 774 P.2d 1199 (1989); and, Continental Insurance v. Page Engineering Co., 783 P.2d 641 (Wyo.1989).
Because our precedential jurisprudence has not limited manufacturers’ products liability theory to recovery of injury to person or property other than the defective product and because this cause has been tried to a jury and the jury verdict is supported by the record as a whole, I respectfully dissent.
I am authorized to state that DOOLIN, J. joins in this dissent.