1997 -NMCA- 120, Gabaldon v. Erisa Mortg. Co.

• Decision Date: 17 October 1997
• Docket Number: No. 17038,17038
• Parties: , 1997 -NMCA- 120 Christine GABALDON, individually and as next friend of her minor children Victor Baldizan and Charlene Baldizan, Plaintiffs-Appellants. v. ERISA MORTGAGE COMPANY, Jointly and Severally, Defendant-Appellee.
• Court: Court of Appeals of New Mexico

Page 1193

949 P.2d 1193

124 N.M. 296, 1997 -NMCA- 120

Christine GABALDON, individually and as next friend of her minor children Victor Baldizan and Charlene Baldizan, Plaintiffs-Appellants. v. ERISA MORTGAGE COMPANY, Jointly and Severally, Defendant-Appellee.

No. 17038.

Court of Appeals of New Mexico.

Oct. 17, 1997.

Certiorari Granted Nov. 21, 1997.

[124 N.M. 299] Albert B. Lassen, Lassen & Jaffe, Albuquerque, for Plaintiffs-Appellants.

J.E. Casados, Robert L. Hlady, Gallagher, Casados & Mann, P.C., Albuquerque, for Defendant-Appellee.

OPINION

BUSTAMANTE, Judge.

¶1 Young Victor Baldizan was injured in a near-drowning incident in the wave machine at The Beach Waterpark (The Beach) in Albuquerque. Victor, acting by and through his mother, filed suit against the owner of the property, Erisa Mortgage Company (Erisa), the lessee/operator of the property, Jay-Bi Property Management, Inc., and the City of Albuquerque. Victor appeals from an order dismissing his claims against Erisa, asserting that (1) operation of a wave pool is an inherently dangerous activity, thus imposing a non-delegable duty on the owner of the property for the safety of waterpark patrons; and (2) Erisa negligently entrusted operation of the park to Jay-Bi. We hold that operation of a wave pool is not an inherently dangerous activity and that there are questions of fact precluding summary judgment on Victor's negligent entrustment theory. We therefore reverse in part and affirm in part.

INHERENTLY DANGEROUS ACTIVITY

¶2 The procedural posture of this case requires us to explore two preliminary considerations before we deal with the core substantive issue. First, we must identify the substantive issues we will address. Second, we examine and define the standard of review we should apply. The latter discussion is necessary because of the potential conflict between the normal standards we use in summary judgment cases and the standard applied when we are dealing with questions of law. See Sarracino v. Martinez, 117 N.M. 193, 194-95, 870 P.2d 155, 156-57 (Ct.App.1994).

¶3 Plaintiff's theory of inherently dangerous activity presents two distinct questions of law: (1) whether wave pools are inherently dangerous, and (2) whether the principle of non-delegable duty flowing from a determination of inherently dangerous activity applies to impose potential liability on a non-possessory landlord. The first is the narrower issue, and, in keeping with our general desire to decide cases on narrow rather than broad grounds, we address it first. Because our decision on the first issue resolves this case, the second issue remains unanswered.

STANDARD OF REVIEW

¶4 Whether an activity should be deemed inherently dangerous--thus imposing a non-delegable duty of care on the person on whose behest the activity is undertaken--is a question of law. Saiz v. Belen Sch. Dist., 113 N.M. 387, 395-96, 398, 827 P.2d 102, 110-11, 113 (1992). We, of course, accept this proposition, but we harbor some concern about its application on appeal from a grant of summary judgment. While characterization of an activity as inherently dangerous is the responsibility of the courts, the determination can rarely be made in the absence of facts concerning the nature of the danger posed by the activity. While some activities may be deemed inherently dangerous simply as a matter of common experience (for example, as in Saiz, 113 N.M. at 398, 827 P.2d at 113, construction and maintenance of high voltage lines in areas where the general public is likely to come in contact with them), it is likely that in most instances the court will need a factual record underpinning its decision. The party seeking determination of an inherently dangerous activity bears the burden of making an adequate factual showing. The adequacy of the showing is to be assessed by the court, not by the jury. Id. at 396, 827 P.2d at 111. Thus, even in a case in which a jury has been demanded, the ultimate decision on this issue is made by the court.

¶5 The procedural tool used by the trial court to make its decision has the potential to complicate review on appeal, and this case is a good example of that potential coming to fruition. The trial court dismissed the claim against Erisa, and decided the legal issue of inherently dangerous activity, in response to Erisa's "Motion To Dismiss Or In The Alternative for Summary Judgment." Since both parties submitted affidavits, exhibits and other material outside the pleadings, the matter was properly treated as a motion for summary judgment. Normally, when reviewing a grant of summary judgment, appellate courts view the evidence in the light most favorable to the party opposing the motion, that is, in support of the right to a trial on the merits. Sarracino, 117 N.M. at 194, 870 P.2d at 156. When there is conflicting evidence, or the evidence supports conflicting inferences, summary judgment is improper. Id. The final requirement of the review rubric is that summary judgment should be granted only "when a party is entitled to judgment as a matter of law." Id.

¶6 A different standard is applied when reviewing a trial court decision on a question of law. In that instance the appellate court reviews the legal issues on a de novo basis. That is, the appellate court decides the legal issue with no formal deference paid to the trial court decision. See State v. Attaway, 117 N.M. 141, 144-45, 870 P.2d 103, 106-07 (1994); Ledbetter v. Webb, 103 N.M. 597, 602-03, 711 P.2d 874, 879-80, (1985) ("An appellate court is not bound by a trial court's erroneous conclusion of law.").

¶7 When the decision presents a mixed question of fact and law, review is altered to the extent that the appellate court should defer to the trial court's findings as to the "historical facts that animate the transaction to be evaluated" to the extent they are supported by substantial evidence in the record. Attaway, 117 N.M. at 144, 870 P.2d at 106. However, the legal consequences flowing from the historical facts will be subject to de novo review if the question involves matters of public policy with broad precedential value beyond the confines of the particular case. Id. at 144-45, 870 P.2d at 106-07. This judgment has already been made in this arena by our Supreme Court in Saiz, 113 N.M. at 398, 827 P.2d at 113. Thus, we review the question of inherently dangerous activity de novo.

¶8 However, we are still faced with a question of which standard we should apply to the historical or underlying facts which were presented to the trial court and upon which it presumably based its decision. Should the summary judgment standard resolving all reasonable inferences in favor of trial be applied? Or, should we apply a standard more akin to an independent review of the record? The answer depends on whether there are factual issues which can reasonably be submitted to the jury. In Sarracino, 117 N.M. at 194, 870 P.2d at 156, for example, we reversed a summary judgment which had been "based in part on a determination that Defendant did not owe a duty to Plaintiff." In Sarracino, the plaintiff was attacked by a third person while waiting in defendant's automobile to be taken home. There was evidence plaintiff was intoxicated to the extent she could not take care of herself. Defendant apparently asserted the general rule that " 'absent a showing that a party has a special relationship with another, the party has no duty to protect the other from harm caused by criminal acts of third persons.' " Id. at 195, 870 P.2d at 157 (quoting Rummel v. Edgemont Realty Partners, Ltd. 116 N.M. 23, 26, 859 P.2d 491, 494 (Ct.App.1993)). We held there were questions of fact precluding summary judgment as to whether defendant had taken charge of a helpless person within the meaning of Restatement (Second) of Torts § 324 (1965). ¹

¶9 More pertinent to our concerns here, we determined there were questions of helplessness and taking charge which could and should be answered by the jury, probably in response to special interrogatories. If the jury answered in the affirmative, the existence of a duty under Section 324 of the Restatement would be determined. We agree that if existence of a duty under established principles can be informed by answering specific factual inquiries, the factual decision should be left to the jury. In that instance, application of the normal summary judgment standard of review is appropriate.

¶10 The case before us appears to be different. Characterizing an activity as inherently dangerous or as involving peculiar risk requires evaluation of the likelihood of harm occurring as a result of the activity. Saiz, 113 N.M. at 396, 827 P.2d at 111. In citing to a portion of the Restatement, Saiz described the necessary quantum of risk variously as: (1) the hazard must be substantial; (2) the work activity or the object sought to be obtained is very likely to cause harm if reasonable precautions are not taken; (3) the work is of such a nature that in the ordinary course of events its performance would probably, and not merely possibly, cause injury; and (4) the risk must be unusual, not a normal routine matter of customary human activity. Id.; Restatement § 413 cmt. b. None of these formulations of the test suggest discrete, factual questions which could be submitted to a jury without effectively asking the ultimate question: Is this activity inherently dangerous? Thus we do not believe this case is susceptible to the approach successfully used in Sarracino, 117 N.M. at 194, 870 P.2d at 156. ²

¶11 Victor has not provided us with, and we have not divined, a list of specific factual issues which are susceptible of submission to the jury and which would be helpful in deciding the ultimate issue of inherently dangerous activity. Given the public policy implications of a determination of inherently dangerous activity, we determine that an independent review of the record is more appropriate in this case. We are...