Court Opinion

ID: 9738862
Source: CourtListenerOpinion
Date Created: 2023-08-26 20:04:40.198303+00
Date Added: 2024-06-11T07:24:08.874671
License: Public Domain

*206Concurring Opinion
Sharp, J.
Although I concur in the result reached by the majority opinion, I believe it necessary to discuss arguments raised by the brief and oral arguments in this case. I do this in view of the importance of this case in the so-called products liability area.
The arguments of both sides generally polarize around their respective characterizations of the legal status of Appel-lee.
Basically, Appellant would classify Appellee as a manufacturer and would object to Defendant’s Instruction Number 19, set out in the majority opinion, for the reason that it requires privity, which requirement, Appellant argues, was abrogated in Indiana by J. I. Case v. Sandefur, 245 Ind. 213, 197 N.E. 2d 519 (1964).
Appellee’s argument as it pertains to Defendant’s Instruction Number 19 is that Appellee is and should be considered an independent contractor and thus the case of Davis v. Henderlong Lumber Co., 221 F. Supp. 129 (N. D. Ind. 1963), is relevant. The Davis case, while recognizing that Indiana would follow the rule of MacPhersen v. Buick Motor Co., 217 N. Y. 382, 111 N. E. 1050 (1916), in products liability cases, retains an exception to that rule in cases involving independent contractors.
The facts of this case, as the arguments indicate, do not lend themselves to a simple classification of the Appellee either as a manufacturer or an independent contractor. I do not believe that the applicable law requires such an automatic labeling or categorization.
The important question is not whether the Appellee is a “manufacturer” or an “independent contractor.” The proper question presented here is: What is the liability to third persons of a party who constructs or manufactures chattels for another party for injuries sustained by the third party because of a defect in the product?
*207In what have been traditionally labeled as “products liability” cases, Indiana finally formally adopted the rule of MacPhersen v. Buick Motor Co., supra, in the J. I. Case decision. The Indiana Supreme Court held that the manufacturer of a product would be liable to third persons for the negligent manufacture of the product with hidden defects. The Court stated that the manufacturer does not thereby become an insurer. It is not necessary in this opinion to examine in more detail the well established ramifications of this general rule.
It is necessary, however, to examine the law as it applies to those cases which cannot so easily be labeled as “products liability” cases; that is, cases in which the Defendant does not individually and separately plan, design, produce and sell a product on the “open market.”
Traditionally, the other class of cases which was recognized as being significantly different and warranting the application of' different principles of law was that class involving building contractors. The liability to third persons of one who constructs a building or structure for another has not kept pace with that of a “manufacturer.” In many jurisdictions, including Indiana, the requirement of privity lingered. See Anno, at 58 A. L. R. 2d 869, 870. See also, Travis v. Rochester Bridge Co., 188 Ind. 79, 122 N. E. 1 (1919). The Travis case held that the acceptance of the work by the other party to the contract operates as the intervention of an independent human agency which breaks the claim of causation so as to preclude a third party from maintaining an action against the contractor. The Court held that in cases involving products not “inherently dangerous” there could be no liability for hidden defects unless the builder knew of the defects and failed to warn the user or if he fraudulently concealed the defects. Davis v. Henderlong Dumber Co., supra, dispensed with the privity requirement in construction cases but retained one proper exception. That case held that a building contractor is held to the same general standard of reasonable care for the protection of anyone who may fore-*208seeably be endangered by his negligence, even after completion and acceptance of the work or structure, unless the contractor has merely carried out plans and specifications and directions given him. The Court held that a builder is not held responsible for accidents resulting from inadequacies in plans or specifications, unless the plans are so obviously dangerous that no reasonable man would follow them. Davis inherently would hold a contractor liable for hidden defects, without requiring that he fraudulently concealed them. See also the leading case of Hanna v. Fletcher, 231 F. 2d 469 (D. C. Cir. 1956).
This is the proper law. There is no logical reason for holding a manufacturer and contractor to different standards of care with respect to hidden defects. The rule and reasoning of MacPhersen v. Buick Motor Co. should be applicable to both.
Finally, it is necessary to consider that group of cases, like the instant one, which do not easily fit neatly in one category or the other, i.e., in neither the “products liability” group nor building contractor group.
The duty and standard of care should be no different. The rule stated in Davis need not be arbitrarily restricted only to the classes of cases which can be labeled as independent building contractor cases. The rules of Davis and J. I. Case are not mutually exclusive. One who constructs a chattel or building for another is liable to third persons who are injured as a result of a hidden defect in the product. For a builder, contractor, or manufacturer to be liable to a third person for an injury sustained by that person after the completion and acceptance of the work, the defendant must have been guilty of negligence, the plaintiff must be one of a class as to whom the consequences of negligence may be foreseen, the injury must be the proximate result of the negligence, and the plaintiff must be free of contributory negligence. If the contractor or builder is acting upon plans and specifi*209cations furnished by the other contracting party, the contractor is justified in relying upon those plans and specifications, unless they are so obviously defective that an ordinary contractor of ordinary prudence would not follow them.
To the extent that Defendant’s Instruction Number 19 states the Appellee’s liability to third persons for hidden defects would be cut off by acceptance of the work unless the Appellee “knew of the existence of the defects and fraudulently concealed them”, it is erroneous.
An important distinction of the Davis case should be noted here. It is possible for defect to be inherent in the plans and specifications furnished to the builder or contractor. In the Davis case, for example, the defect resulting in the injury was in a chemical fume hood and exhaust apparatus constructed by the defendant and installed in a newly constructed chemical laboratory. The defect was inherent in the plans and specifications given to the defendant and were without the bounds of the expertise of the defendant. In such a situation the defendant is not held responsible unless, as has already been stated, the plans are so obviously defective no reasonable builder would follow them. If, however, the defect is in the construction itself, the principles of MacPhersen v. Buick Motor Co. apply.
The great emphasis which counsel for both sides place upon the determination of who supplied the plans, designs, and specifications for the trailer in question is not only reduced by the anomolous answers to interrogatories given by the jury in which they found neither Harley Coster nor Beck Welding designed the trailer, but also by the principle stated above; i.e., that the builder or contractor is liable to third persons if the defect resulting in the injury is in the construction itself and not a defect inherent in the plans and specifications. Here the evidence is clear the defect was in a weld, in the construction itself. Only if the injury to Hobson resulted from a defect in the design of the trailer would the *210question of who furnished those designs and specifications have the relevance that counsels would have us give it.
Although Defendant’s Instruction Number 19 constitutes reversible error, thé foregoing discussion is relevant also to Defendant’s Instruction Number 31, objected to by Appellant and herein set out:
“Before a manufacturer can be held to respond in damages to an injured third party who is not in privity of contract with the manufacturer and in circumstances where the manufacturer so constructed the product as to make it imminently dangerous when put to the use for which it was intended, it must be shown that the article is imminently dangerous when put to the use and serving the very purpose for which it is bought and sold.”
This instruction is also erroneous in that it establishes a different standard of liability for those persons “not in privity” with a manufacturer. J. I. Case v. Sandefur, supra, has abolished this difference in Indiana as has been stated.
Both instructions are erroneous. For this reason and the reasons set out above I concur in the result reached by the majority opinion.
Note. — Reported in 245 N. E. 2d 344.