Sterner Aero AB v. Page Airmotive, Inc.
| Decision Date | 10 June 1974 |
| Docket Number | No. 73-1810.,73-1810. |
| Citation | 499 F.2d 709 |
| Parties | STERNER AERO AB and Various Underwriters At Lloyds, Plaintiffs-Appellants, v. PAGE AIRMOTIVE, INC., et al., Defendants-Appellees. |
| Court | U.S. Court of Appeals — Tenth Circuit |
Clyde A. Muchmore of Crowe, Dunlevy, Thweatt, Swinford, Johnson & Burdick, Oklahoma City, Okl. (Ben L. Burdick of Crowe, Dunlevy, Thweatt, Swinford, Johnson & Burdick, Oklahoma City, Okl., and Harold B. Carter, Jr. and A. Gordon Grant, Jr. of Montgomery, Barnett, Brown & Read, New Orleans, La., on the brief), for appellants.
Gary C. Bachman, Oklahoma City, Okl., for Page Airmotive, Inc.
Clyde J. Watts of Watts, Looney, Nichols, Johnson & Hayes, Oklahoma City, Okl. (William H. Wilson of Rhodes, Hieronymus, Holloway & Wilson, and Burton J. Johnson of Watts, Looney, Nichols, Johnson & Hayes, Oklahoma City, Okl., on the brief), for Thunderbird Aviation, Inc.
Before HILL and DOYLE, Circuit Judges, and DURFEE,* Judge.
The issue presented to us in this appeal is whether the trial court erred in granting defendants' motion for summary judgment. Defendant Page Airmotive had rebuilt an airplane engine and sold it to Sterner Aero AB, which was in Sweden. This engine failed on a take off, causing the plane to go down. The forced landing was in a lake and there were no personal injuries, but the plane itself was damaged and the demand is for some $50,000.
The engine, which was purchased from Page Airmotive, was a Pratt-Whitney R-1340-AN-1. The purchase was made on April 26, 1968 and the malfunction occurred on May 28, 1969. The action herein is in negligence in which the doctrine of res ipsa loquitur is invoked and also in implied warranty.
At the time of the crash the plane had been in operation for one year and had a total of 538 hours of flying time. The parties to the sale had entered into a warranty agreement which was carefully negotiated through correspondence of the parties. This correspondence occurred over a month prior to the completion of the sale.
First, there was a standard written warranty which provided that:
However, by letter dated April 15, 1968, it was agreed that the 90 day warranty be extended to six months or 100 hours, whichever occurred first.
The question is whether this exclusion of all other warranties, express or implied, effectively barred the present action, even though a tort, so as to justify the granting by the court of the defendants' motion for summary judgment. In granting the motion for summary judgment the trial court noted that the contracting parties were knowledgeable and that they had carefully negotiated the terms and conditions of the sale. The trial court then went on to say:
In view of this negotiated contract between knowledgeable parties covering the specific warranties agreed upon, the Court is of the opinion that § 402-A, Restatement of Torts (2nd) does not apply. The Court knows of no law which prohibits knowledgeable parties from agreeing upon the terms of a warranty of merchandise or materials sold. This is not a case between an ordinary purchaser of consumer goods who relies upon the expertise and knowledge of the seller or manufacturer. The parties to this case had an equal bargaining position, and could contract upon such terms and conditions as they saw fit.
The trial judge added that the engine had accumulated engine running time of 538 hours (almost its recognized life). It had been in use for more than one year so that the engine hours and the restrictions had been far exceeded when the failure occurred.
Finally, the trial court ruled that the limitations of hours and of time contained in the warranty precluded a lawsuit under implied warranty or § 402A.
Oklahoma law has long recognized the contractual disclaimer of express and implied warranties. Allis-Chalmers Mfg. Co. v. Hawhee, 187 Okl. 670, 105 P.2d 410 (1940). At present such waiver continues to be allowed under the specified provisions of 12A O.S. A. § 2-316.
Like many states, Oklahoma first developed the concept of liability without fault in products defect cases under the rubric of implied warranty. This approach started as a contractual one, and as such often carried contractual defenses such as the requirement of privity, the requirement of giving notice of defects and the right of contract disclaimers. See discussion in Prosser, Torts (2d ed. 1971), pp. 655-58. These contract defenses caused complexity as well as injustice and this caused many states to abandon these defenses. Oklahoma took this step as far as the requirement of privity in products liability cases. Marathon Battery Co. v. Kilpatrick, 418 P.2d 900 (Okl.1966).
Many jurisdictions have gradually abandoned the whole concept of implied warranty in products liability, adopting instead the simpler and more manageable concept of strict liability in tort as exemplified by § 402A, Restatement of the Law of Torts 2d. This strict liability in tort is substantially similar to implied warranty stripped of the contract defenses of privity, notice, disclaimer and the other contract attributes.
Very recently the Oklahoma Supreme Court followed the lead of other jurisdictions in taking this final step. It has adopted the concept of strict liability in tort as it is defined in § 402A of the Restatement. Its only reservation is in designating it as Manufacturers' Products Liability. This significant development is fully set forth in Kirkland v. General Motors, Okl., 521 P.2d 1353, decided April 23, 1974.1 It is important to note that Kirkland was decided after the district court ruled on appellee's motion for summary judgment at bar, on August 22, 1973. Indeed this appeal had been filed and the briefs had been submitted at the time of the announcement of the decision.
While in most instances it is immaterial whether plaintiff seeks to recover (or the jurisdiction allows recovery) under the theory of strict liability in tort or under implied warranty without privity requirements, the question is vital in the case at bar because the trial court was asked to decide the legal effect of a negotiated contractual disclaimer between plaintiff and defendant Page of all implied warranties, a waiver provision which, being clearly expressed and entered into through negotiation between parties of relatively equal bargaining power, would be legally permissible in Oklahoma. Such a waiver would not appear to abrogate plaintiff's right of action in tort under strict liability, as such a right exists in Oklahoma, for it does not mention any waiver of strict liability.
However, given the clear language of the waiver provision together with the fact that the total warranty was freely entered into following express negotiations by the parties, we have to conclude that its intent was to preclude all future rights to recover for product defects which had their legal basis in express or implied warranties (other than the express warranty negotiated by the parties in the agreement).
Under the Kirkland opinion, breach of implied warranty is no longer an appropriate remedy for recovery in products liability cases, except as provided in the Uniform Commercial Code. The implied warranty theory is now merged under Oklahoma law into the theory and doctrine of Manufacturers' Products Liability. (See page 1365 of the Kirkland opinion).
Having concluded that the result of limiting defendants' warranty liability was to bar any suit based upon implied warranty, the remaining question is whether plaintiff has tort claims in negligence and strict liability.
It is our conclusion that the disclaimer provision was not effective to bar an action based upon Manufacturers' Products Liability as that doctrine has been defined in Kirkland v. General Motors Corp., supra. The Kirkland case involved an allegedly defective seat back adjustment mechanism in a 1969 Buick automobile. The Oklahoma Supreme Court decided that traditional concepts of contract law are inapplicable in Manufacturers' Products Liability cases. We construe this as precluding the defendants from asserting the existence of a contractual disclaimer provision as a valid defense to liability.2
The Kirkland decision delineated the three essential elements (set forth in § 402A) which are necessary to establish a case in Manufacturers' Products Liability: First, plaintiff must prove that the product was the cause of the injury; second, plaintiff must prove that the defect existed in the product at the time it left the manufacturers' possession and control; and third, plaintiff must prove that the defect made the product "unreasonably dangerous", that is, dangerous to an extent beyond that which would be contemplated by the ordinary purchaser.
We do not prejudge the evidence. As of now it cannot be determined to be sufficient to satisfy the standards of Oklahoma's new...
To continue reading
Request your trial
-
Hill v. Joseph T. Ryerson & Son, Inc.
...exclusively to the right to replacement thereof or to repayment of the price, as above provided."6 E. g., Sterner Aero AB v. Page Airmotive, Inc., 499 F.2d 709, 713 (10th Cir. 1974); West v. Caterpillar Tractor Co., 336 So.2d 80, 88 (Fla.1976); Whitaker v. Farmhand, Inc., 567 P.2d 916, 922 ......
-
Morningstar v. Black and Decker Mfg. Co.
...defenses which are not applicable to a cause of action founded on strict liability in tort. E. g., Sterner Aero AB v. Page Airmotive, Inc., 499 F.2d 709, 713 (10th Cir. 1974); West v. Caterpillar Tractor Co., 336 So.2d 80, 88 (Fla.1976); Whitaker v. Farmhand, Inc., 567 P.2d 916, 922 (Mont.1......
-
Mid Continent Aircraft Corp. v. Curry County Spraying Service, Inc.
...1966, writ ref'd n. r. e.); Keystone Aeronautics Corp. v. R. J. Enstrom Corp., 499 F.2d 146 (3d Cir. 1974); Sterner Aero AB v. Page Airmotive, Inc., 499 F.2d 709 (10th Cir. 1974); Vandermark v. Ford Motor Company, 61 Cal.2d 256, 37 Cal.Rptr. 896, 391 P.2d 168 (1964). See Restatement, Second......
-
Denny v. Ford Motor Co.
...at 345, 305 N.Y.S.2d 490, 253 N.E.2d 207; accord, Gumbs v. International Harvester, 718 F.2d 88 [3d Cir.]; Sterner Aero AB v. Page Airmotive, 499 F.2d 709, 712 [10th Cir.]; Larsen v. Pacesetter Sys., 74 Haw. 1, 837 P.2d 1273; 1 Frumer and Friedman, Products Liability § 2.03, at 2-28; 2 Frum......
-
The Applicability of Tort Law to Commercial Buyers
...cause of action . . . is not affected by any disclaimer or other agreement.' RESTATEMENT (SECOND) OF TORTS § 402A cmt. m (1977). 152. 499 F.2d 709 (10th Cir. 1974) (applying Oklahoma law). 153. 499 F.2d 146 (3d Cir. 1974) (predicting Pennsylvania law). 154. See Sterner, 499 F.2d at 713. 155......
-
Negligence: the Construction Claim Panacea?
...1968); Pan American World Airways v. United Aircraft Corp., 53 Del. 7, 163 A.2d 582 (1960). 38. Sterner Aero AB v. Page Airmotive, Inc., 499 F.2d 709, 714 (10th Cir. 1974) (warranty); Berwind Corp. v. Litton Industries, Inc. 532 F.2d 1,7 (7th Cir. 1976) (warranty and consequential damages);......