Lane v. Barringer

• Decision Date: 24 July 1980
• Docket Number: No. 1-1079A268,1-1079A268
• Citation: 407 N.E.2d 1173
• Parties: 29 UCC Rep.Serv. 1273 Margaret A. LANE, Appellant, v. Gerald L. BARRINGER and Iva Barringer, d/b/a Handi Foods, Holloway House Industrial Products, a Division of Chemical Corporation of America, Owens- Illinois, Inc. and Venus Laboratories, Inc., Appellees.
• Court: Indiana Appellate Court

Page 1173

407 N.E.2d 1173

29 UCC Rep.Serv. 1273

Margaret A. LANE, Appellant, v. Gerald L. BARRINGER and Iva Barringer, d/b/a Handi Foods Holloway House Industrial Products, a Division of Chemical Corporation of America, Owens- Illinois, Inc. and Venus Laboratories, Inc., Appellees.

No. 1-1079A268.

Court of Appeals of Indiana, First District.

July 24, 1980.

William F. Marshall, Dalmbert & Marshall, Columbus, for appellant.

Don M. Robertson, Joseph D. O'Connor, III, Bunger, Harrell & Robertson, Bloomington, for appellees, Gerald L. Barringer and Iva Barringer, d/b/a Handi Foods.

John P. Price, Robert G. Weddle, Daniel R. Fagan, Bingham, Summers, Welsh & Spilman, Indianapolis, for Holloway House Industrial Products.

Leon D. Cline, Cline, King & Beck, Columbus, for appellee, Owens-Illinois, Inc.

Peter B. Stewart, Stewart, Irwin, Gilliom, Fuller & Meyer, Indianapolis, for appellee, Venus Laboratories, Inc.

ROBERTSON, Presiding Judge.

Margaret A. Lane brought a personal injury suit against multiple defendants who were involved with the manufacture, packaging, distribution and retail sale of a liquid drain cleaner, Industrial Drain Opener. The trial court granted a motion to dismiss, for failure to state a claim upon which relief could be granted, in favor of Venus Laboratories, Inc., the manufacturer of the cleaner. The trial court also granted motions for summary judgment in favor of Owens-Illinois, Inc., who supplied the container for the cleaner: Holloway House Industrial Products, the distributor of the cleaner: and Gerald and Iva Barringer, managers of the retail store, Handi Foods, which offered the cleaner for sale. Margaret A. Lane now appeals the granting of these various motions.

We affirm.

The relevant facts are that in the late evening of April 27, 1974, the appellant, Margaret A. Lane (Lane) accompanied her daughter to a Handi Foods store in Columbus, Indiana. The daughter intended to purchase a drain opener to unclog a toilet in her home. She was seeking a strong drain cleaner because the toilet was clogged with beef bones. After examining several products, the daughter took a container of Industrial Drain Opener from the shelf, placed it under her arm, and began to leave the display area. The container fell to the floor, broke open, and the cleaner splashed onto Lane's legs injuring her.

Lane initiated this suit on May 14, 1976. Her complaint, as amended, sought relief under three different legal theories. Two of the claims sounded in tort; one based upon negligence and one based upon strict liability in tort. The third theory sounded in contract for breach of implied warranty. As to the claims sounding in tort, the applicable two year statute of limitations had run when the complaint was filed thus barring any recovery. See Ind.Code 34-1-2-2. Therefore, the essential issue before the trial court in ruling on the various motions, which are now the subject of this appeal, was whether or not Lane could maintain a contract action for breach of implied warranty, pursuant to Ind.Code 26-1-2-314 and Ind.Code 26-1-2-318, against the various defendants.

IC 26-1-2-314 specifies that there is an implied warranty that goods are merchantable in a contract for sale of goods when the seller is a merchant who regularly sells such goods. IC 26-1-2-318 extends the protection of an implied warranty, pursuant to section 314, to third party beneficiaries in certain instances. Lane seeks to bring herself within the scope of the third party beneficiary provision. By doing so, she also seeks the benefit of the four year statute of limitations applicable to a breach of contract for sale of goods. Ind.Code 26-1-2-725.

Given this basis for review, we turn to the question of whether or not the trial court properly granted the motions for summary judgment in favor of Owens-Illinois, Inc., the container supplier, and Holloway House Industrial Products, the distributor.

The granting of a motion for summary judgment is of course only proper when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Ind.Rules of Procedure, Trial Rule 56(C); Stuteville v. Downing (1979) Ind.App., 391 N.E.2d 629. A fact is "material" if it tends to facilitate resolution of any of the issues for or against the party having the burden of proof on the issue. Stuteville v. Downing, supra; Brandon v. State, (1976) 264 Ind. 177, 340 N.E.2d 756. When entertaining a motion for summary judgment, the evidence before the court should be construed in a light most favorable to the nonmoving party. Tekulve v. Turner (1979) Ind.App., 391 N.E.2d 673; Smith v. P & B Corp., (1979) Ind.App., 386 N.E.2d 1232. "However, despite conflicting facts and inferences on some elements of a claim, summary judgment may be proper where there is no dispute or conflict regarding a fact that is dispositive of the litigation." Stuteville v. Downing, 391 N.E.2d at 629, citing Hayes v. Second Nat. Bank of Richmond (1978) Ind.App., 375 N.E.2d 647. This latter point is applicable to the situation in the case at bar.

Lane argues vigorously that the concept of a "sale" is broad enough to encompass the factual setting between her daughter and Handi Foods. She further argues that her relationship to her daughter was sufficient to bring her within the third party beneficiary provisions of IC 26-1-2-318. Nonetheless, even assuming Lane could prevail on these points, the trial court's decisions on the summary judgment motions for Owens-Illinois, Inc. and Holloway House Industrial Products are correct, because there was no privity of contract between Lane or her daughter and these remote defendants.

Clearly, privity of contract is no longer required if a personal injury action for a defective product sounds in tort; either on a negligence theory or on the theory of strict liability in tort. Neofes v. Robertshaw Controls Company, (S.D.Ind.1976) 409 F.Supp. 1376; Withers v. Sterling Drug, Inc., (S.D.Ind.1970) 319 F.Supp. 878; Dagley v. Armstrong Rubber Company, (7th Cir. 1965) 344 F.2d 245. However, the abrogation of the privity requirement in tort law has not eliminated the privity requirement when the cause of action sounds in contract for breach of warranty. Neofes v. Robertshaw Controls Company, supra; Withers v. Sterling Drug Inc., supra; Dagley v. Armstrong Rubber supra. Therefore, even after the trial court drew the proper inferences in favor of the nonmoving party, Lane, it was presented with an undisputed material fact which was dispositive of the litigation. Lane could not be a third party beneficiary as to Owens-Illinois, Inc. and Holloway House Industrial Products because there was no privity between Lane's daughter and these defendants, and therefore, no contract for her benefit. Neofes v. Robertshaw Controls Company, supra, is directly on point as to a claim by an alleged third party beneficiary, when privity is lacking, and reaches the same conclusion.

We now turn to the question of whether or not the trial court properly granted Venus Laboratories, Inc.'s motion to dismiss for failure to state a claim upon which relief can be granted. The trial court's order granting Venus's motion indicates that matters outside the pleadings were considered by the court in making its decision. In such a case, there is no distinction between a motion to dismiss and a motion for summary judgment and the motion to dismiss shall be treated as a motion for summary judgment. Middelkamp v. Hanewich, (1977) Ind.App., 364 N.E.2d 1024; Schenkel Enterprises, Inc. v. Indiana & Michigan Elec. Co., (1979) Ind.App., 393 N.E.2d 268. Therefore, in reviewing the trial court's decision on Venus's motion, we have viewed it as a motion for summary judgment. The same reasoning which was applicable to the motions made by Owens-Illinois, Inc. and Holloway House Industrial Products also applies in this instance. Lacking privity between her daughter and Venus, Lane could not be a third party beneficiary of any contract for sale of goods and thus Venus was entitled to judgment as a matter of law.

We have now reached the final link in the chain of defendants, Gerald and Iva Barringer. The Barringers operated the Handi Foods store which sold the drain cleaner. Thus, again assuming Lane could prevail on the question of whether there was sale and that she could bring herself within the class of persons protected by IC 26-1-2-318, there would have been no problem with the privity requirement in maintaining the contract action against the Barringers. The record, however, reflects that the Barringers were dismissed as defendants by the stipulation of the parties. Therefore, there is no question before us as to the maintenance of an action against the Barringers because they are no longer parties to the lawsuit. ¹

The only other possible defendant for a contract action, one who was arguably in a privity with Lane's daughter, was Handi Foods, Inc., the corporate entity which actually owned the market selling the drain cleaner. Although the record is somewhat confusing because several of the parties refer to Handi Foods, Inc. as if it were a party to the law suit, our review indicates that Handi Foods, Inc., was never served with process in compliance with Ind. Rules of Procedure, Trial Rule 4.6. Therefore, Handi Foods, Inc. never became a party to the suit and there is no question before us concerning a contract action against Handi Foods, Inc.

Finding no error, the judgment of the court below is affirmed.

NEAL, J., concurs.

RATLIFF, J., with separate opinion concurs in part, dissents in part, and concurs in result.

RATLIFF, Judge, concurring in part, dissenting in part, and concurring in result.

I concur in the result reached in this case on the ground that Margaret A. Lane, the plaintiff, was not a third-party beneficiary entitled to maintain an action for damages for personal injuries for breach of implied warranty under the narrow scope of the...