State Farm Fire & Cas. Co. v. Chrysler Corp.

• Decision Date: 18 May 1988
• Docket Number: No. 87-202,87-202
• Citation: 523 N.E.2d 489,37 Ohio St.3d 1
• Parties: , Prod.Liab.Rep. (CCH) P 11,796 STATE FARM FIRE & CASUALTY COMPANY et al., Appellees, v. CHRYSLER CORPORATION et al., Appellants.
• Court: Ohio Supreme Court

Page 1

37 Ohio St.3d 1

523 N.E.2d 489, Prod.Liab.Rep. (CCH) P 11,796

STATE FARM FIRE & CASUALTY COMPANY et al., Appellees, v. CHRYSLER CORPORATION et al., Appellants.

No. 87-202.

Supreme Court of Ohio.

Submitted Dec. 2, 1987.

Decided May 18, 1988.

Syllabus by the Court

1. App.R. 12(D) and Civ.R. 42(B) together authorize a court of appeals to order a retrial of only those issues which resulted in prejudicial error. (Charles R. Combs Trucking, Inc. v. International Harvester Co. [1984], 12 Ohio St.3d 241, 12 OBR 322, 466 N.E.2d 883, paragraph one of the syllabus, and Mast v. Doctor's Hospital North [1976], 46 Ohio St.2d 539, 75 O.O.2d 556, 350 N.E.2d 429, followed.)

2. The rationale authorizing reviewing courts to order a limited remand implicitly recognizes the need for appellate courts to carefully exercise their discretion to determine the appropriate scope of remand. (Charles R. Combs Trucking, Inc. v. International Harvester Co. [1984], 12 Ohio St.3d 241, 12 OBR 322, 466 N.E.2d 883, and Mast v. Doctor's Hospital North [1976], 46 Ohio St.2d 539, 75 O.O.2d 556, 350 N.E.2d 429, explained.)

3. A product may be proven to be in a defective condition if it is more dangerous than an ordinary consumer would expect when used in an intended or reasonably foreseeable manner. (Leichtamer v. American Motors Corp. [1981], 67 Ohio St.2d 456, 21 O.O.3d 285, 424 N.E.2d 568, paragraph two of the syllabus, and its progeny, followed.)

4. Where products fail to perform as safely as an ordinary consumer would expect when used in an intended or reasonably foreseeable manner, strict liability for a design defect is not proven absent proof of causation relating some aspect of the challenged design to the injury.

In October 1981, plaintiff-appellee, Barbara Mowen, purchased a new Dodge Aries "K-car" manufactured by defendant-appellant, Chrysler Corporation, from defendant-appellant, Morningstar Chrysler-Plymouth, Inc. The automobile experienced a series of electrical problems which Morningstar sought to repair under warranty. Ultimately, on March 1, 1982, the automobile caught fire when it was parked, turned off, and left unattended in the Mowens' garage, destroying the car and damaging the Mowens' home. The Mowens claimed damages totaling $366,523, of which their insurers, plaintiffs-appellees, State Farm Fire & Casualty Company and State Farm Mutual Automobile Insurance Company ("State Farm"), paid $166,523.

Following the fire, State Farm hired Systems Engineering Associates ("SEA") to investigate and determine the origin of the fire. As a result of the investigation, plaintiffs-appellees, State Farm and the Mowens, filed suit against defendants-appellants, Morningstar and the Chrysler Corporation, alleging breaches of express and implied warranties under state law (R.C. 1302.26 and 1302.27), and federal law, the Magnuson-Moss Warranty--Federal Trade Commission Improvement Act, Section 2301 et seq., Title 15, U.S. Code; strict products liability for defects due to negligent design or manufacture; and negligent repair.

At trial, the plaintiffs presented evidence of the history of electrical repairs performed on the vehicle under warranty. Two weeks after its purchase, the automobile would not start. A warranty repair order dated October 19, 1981 indicated that numerous electrical components were replaced, including a dead battery, starter motor, alternator, rotor, and voltage regulator. A week later, a second repair order dated October 26, 1981 indicated that the voltage regulator was again replaced. Two months later, a third warranty repair order dated December 30, 1981 indicated the instrument panel was removed to correct a rattling noise. Shortly after, on January 4, 1982, a defective fuel gauge was the subject of a fourth repair order.

Donald Mowen testified that, because the car was under warranty, only Morningstar mechanics worked on the car. He further testified that he had observed a Morningstar mechanic cut out what he believed to be a "fuse link" safety device and replace it with ordinary wire, although Mowen admitted he did not know if the part removed was, in fact, a fuse link.

The Mowens related that, on Saturday evening, February 27, 1982, while returning from a short trip, they again experienced trouble with their automobile. A red warning light came on, the headlights progressively dimmed, and a burning smell developed. Upon arriving home, they briefly inspected the engine compartment, did not discover the source of the problem, but noted that the odor was most apparent inside, not outside, their vehicle. The following Monday, March 1, 1982, Donald Mowen recharged the automobile battery, drove the car to Morningstar, and related the problem to Morningstar. When Morningstar failed to loan Mowen another car until his could be scheduled for repair several days later, he angrily retorted, "If this car burns it is your fault because I brought it in here to you." Mowen then drove his automobile home, and took another car on a short trip. Upon returning home several hours later, Mowen saw black smoke coming from the garage, and the fire department was summoned.

Plaintiffs presented two SEA investigators at trial as expert witnesses. The first, Glenn Baker, Chairman of SEA, established his expertise as a fire investigator and testified that, in his opinion, based on the fire's burn pattern, duration, intensity, and damage to the auto and house, the fire originated in the passenger compartment, in the area of the dash or instrument panel. After eliminating other possible causes, Baker further opined that the cause of the fire was electrical, to a reasonable degree of scientific probability. He ruled out a fuel-related source because the burn pattern showed the fire started in the passenger compartment, not in the engine. Baker ruled out cigarettes because the Mowens were nonsmokers. He ruled out arson because neither a timing device nor an explosion indicative of an accelerant was evidenced. Baker added that, due to complete combustion of the car, no chemical tests of material samples could effectively identify the presence of any accelerants. Baker also admitted that he found no "bed" in the wires, indicative of a short or arc which could have started the fire, but continued that, because electrical fires can originate from bad components remote from the ignition point, a "bed" is not always found. In addition, although unable to identify which wires might have been energized in the automobile when the ignition was turned off, Baker again noted that the car was too badly burned to permit him to pinpoint any particular wire.

Plaintiffs' second expert, Richard Harmer, a professor of electrical engineering technology and a former employee of SEA, also testified that, in his opinion, the fire started under the dashboard of the automobile in a cable which was partially energized.

Defendants moved for a directed verdict at the close of plaintiffs' evidence. The defendants argued that the plaintiffs failed to prove the essential elements of strict liability by not demonstrating the existence of a defect in the vehicle when it left the manufacturer, which defect proximately caused the fire. This failure of proof, they argued, further vitiated the claims of breach of warranty. Therefore, permitting the case to go to the jury would invite speculation and conjecture. Addressing the claim of negligent repair, defendants contended that no evidence was presented to establish the standard of care and a breach of the standard of care, which proximately caused the fire. Moreover, defendants added that no evidence was offered to establish that the cause of the fire was the recurrence of a defect previously repaired by Morningstar, or caused by its repair.

The plaintiffs asserted that new cars do not have the problems encountered by the Mowens in the absence of an inherent defect. They argued that the record of malfunction, repairs, and the analysis of the fire damage and origin of the fire, construed in their favor, were sufficient to demonstrate the existence of an electrical defect in the new car, and permit the inference that said defect caused the fire.

The trial court sustained the defendants' motion for a directed verdict on all issues, concluding that, even if construed in favor of the plaintiffs, the evidence failed to establish a specific defect caused the fire. Further, the court essentially found that proof of repairs made pursuant to the warranty did not permit the inference that either something was negligently repaired or that something was inherently defective in the electrical system. While construing the evidence that the fire started in the dashboard in favor of plaintiffs, the trial court cited a lack of evidence regarding causation, noting that hot or defective wires, the removal of a loose part, or Donald Mowen's use of a battery charger could have caused the fire. ¹ The court impliedly rejected the assertion that plaintiffs had eliminated all causes of the fire except electrical defects. Finding that the law does not permit speculation as to causation, the court rendered a directed verdict for the defendants.

Plaintiffs appealed only the directed verdict on the strict products liability and negligent repair claims, and raised as error various trial court rulings excluding proffered testimony. The court of appeals adopted plaintiffs' assertion that defect-free automobiles do not start fires, and found sufficient evidence was presented on plaintiffs' strict liability claim to withstand the motion for directed verdict. Upon consideration of the remaining assignments of error, the court of appeals initially stated the issues raised were "probably moot," but then, pursuant to App.R. 12(A), proceeded to overrule them on the merits. The court of appeals stated further that, "[i]n our view the directed verdict on the negligence issue was proper." In response to plaintiffs' motion for clarification and ...