85 Hawai'i 336, Tabieros v. Clark Equipment Co., 17339

Decision Date15 September 1997
Docket NumberNo. 17339,17339
Citation85 Hawaii 336,944 P.2d 1279
Parties85 Hawai'i 336, Prod.Liab.Rep. (CCH) P 15,080 Sosimo B. TABIEROS and Mitsuko H. Wilson, Plaintiffs-Appellees/Cross-Appellants, v. CLARK EQUIPMENT COMPANY, Defendant-Appellant/Cross-Appellee, and Matson Navigation Co., Inc.; John Does 1-10; Jane Does 1-10; Doe Corporations 1-10; and Doe Entities 1-10, Defendants.
CourtHawaii Supreme Court

Page 1290

Lee T. Nakamura and Francis T. O'Brien, Honolulu, on the briefs, for defendant-appellant/cross-appellee Clark Equipment Company.

Jerry M. Hiatt and Paul M. Saito, Bays, Deaver, Hiatt, Kawachika & Lezak, Honolulu, on the briefs, for plaintiffs-appellees/cross-appellants Sosimo B. Tabieros and Mitsuko H. Wilson.

Before MOON, C.J., and LEVINSON, NAKAYAMA and RAMIL, JJ., and CHANG, Circuit Court Judge, in place of KLEIN, J., recused.

Page 1291

LEVINSON, Justice.

This is an appeal and cross-appeal from the special verdict of the jury and the judgment of the circuit court by the defendant-appellant/cross-appellee, Clark Equipment Company (hereinafter, Clark) and the plaintiffs-appellees/cross-appellants, Sosimo B. Tabieros and Mitsuko Wilson (hereinafter, Tabieros and Wilson individually and "the plaintiffs" collectively). These appeals arise out of a lawsuit alleging, inter alia, strict product liability and negligent design following injuries sustained by Tabieros when he was struck by a large piece of mobile equipment, a straddle carrier 1 manufactured by Clark, while he worked at the Sand Island dockyard in the City and County of Honolulu. The jury found Clark liable for Tabieros's injuries under theories of strict product liability and negligent design. The circuit court granted Clark's motion for a directed verdict as to Wilson's 2 claims for infliction of emotional distress prior to the jury's deliberations. The jury found Clark not liable for any damages to Wilson on her remaining claims.

Clark raises seventeen points of error on appeal, each of which falls into one of four general categories. In particular, Clark contends that the trial court erred: (1) with respect to the substance of four of its jury instructions; (2) by allowing, restricting, or excluding the use of certain evidentiary exhibits; (3) by allowing, restricting, or excluding expert testimony; and (4) by failing to give Clark sufficient credit for Matson Navigation, Inc.'s (hereinafter, "Navigation") prejudgment settlement with the plaintiffs. 3

The plaintiffs indicate that they are generally satisfied with the judgment from which Clark is taking its appeal, but allege on cross-appeal that the circuit court erroneously (1) failed to award them prejudgment interest, (2) denied certain costs, which they claim were properly taxable, and (3) denied their motion for additur regarding punitive damages, or, in the alternative, for a new trial on punitive damages. 4 The plaintiffs raise several other points of error, which we address in the event of a retrial on remand. In particular, the plaintiffs argue that the circuit court erred in directing verdicts regarding their claims that Clark negligently (4) failed to retrofit the straddle carrier and (5) inflicted emotional distress on Wilson. They also contend that (6) certain evidence, which Clark argues was improperly admitted in the first place, was actually unduly restricted in its use.

For the reasons discussed below, we hold that a manufacturer has no duty to "retrofit" its products with "after-manufacture" safety equipment, although it may be found negligent or strictly liable for failing to install such equipment--or not otherwise making its product safer--existing at the time of manufacture. We further hold that the circuit

Page 1292

court's jury instructions were inadequate or misleading with respect to (1) a manufacturer's duty to warn against "open and obvious defects and dangers" and (2) the legal significance of a potential jury finding that the plaintiffs failed reasonably to mitigate damages. Accordingly, although we affirm the portion of the judgment entered in Clark's favor and against Wilson, we vacate the remainder of the judgment and remand the matter for a new trial of Tabieros's claims against Clark.

I. BACKGROUND

On April 27, 1988, while working on the loading docks at Pier 52 in the City and County of Honolulu, Tabieros, an employee of Matson Terminals, Inc. (Terminals), 5 was sitting in a jitney parked on the dockside apron of the Sand Island container yard. He was seriously injured when a Series 510 straddle carrier struck his vehicle, crushing both of his legs.

Clark manufactured the straddle carrier and sold it to Navigation in 1963. The Series 510 straddle carrier was specifically manufactured for, and in part designed by, Navigation, although Clark continued to produce this model for other customers, in addition to Navigation, until 1968. Thereafter, Clark discontinued the manufacture of the Series 510, but replaced it with larger and differently configured straddle carriers that it produced for specialized customers. In approximately 1975, fourteen years before Tabieros's accident, Clark sold its straddle carrier manufacturing business.

Navigation owned and maintained the straddle carrier involved in Tabieros's accident until it was transferred to Terminals in 1973, approximately ten years after it was manufactured and fifteen years before the accident. On the day of the accident, the straddle carrier was driven by Howard Dias, who was on loan to Terminals from his employer, MaCabe, Hamilton & Renney Co. (MH & R).

In September 1988, the plaintiffs filed a negligence action against Dias, MH & R, and Navigation for injuries sustained in the April 27, 1988 accident. The plaintiffs later amended their complaint to add Clark as a defendant. The circuit court entered summary judgment in favor of Dias and Navigation and later dismissed the plaintiffs' claims against MH & R. In June 1990, a jury returned a verdict in favor of Clark, which was the only remaining defendant. The plaintiffs appealed, and, in a memorandum opinion, this court: (1) vacated the judgments that had been entered in favor of Navigation and Clark; and (2) affirmed the favorable judgments as to Dias and MH & R. Tabieros v. Diaz, Nos. 14798 & 15014, 73 Haw. 624, 827 P.2d 1148 (Haw. Mar. 27, 1992) (mem.) [hereinafter, Tabieros I ].

In March 1993, a second jury trial commenced between the plaintiffs and the defendants Clark and Navigation. During the trial, the circuit court granted directed verdicts in favor of Clark on the plaintiffs' claims of breach of implied warranties of merchantability and/or fitness for a particular purpose, negligent manufacture, and negligent failure to retrofit. It also dismissed Wilson's claim of negligent infliction of emotional distress.

The jury ultimately returned a special verdict in favor of Tabieros, awarding him $698,000.00 in general damages, $501,000.00 in special damages, and $152,000.00 in punitive damages (with respect to the latter, $52,000.00 against Clark and $100,000.00 against Navigation). As among the parties, the jury apportioned fifty-five percent of the fault to Navigation, thirty-four percent to Clark, and eleven percent to Tabieros. The jury awarded no damages to Wilson.

After the verdict was returned, but before entry of judgment, the plaintiffs settled with Navigation by way of a joint tortfeasor release agreement pursuant to the Uniform Contribution Among Tortfeasors Act (UCATA), Hawai'i Revised StatutesHRS) §§ 663-11 through 663-17 (1993). Thereafter, the plaintiffs filed a dismissal of all of their claims against Navigation. Judgment

Page 1293

against Clark was entered on July 9, 1993 for its pro rata share of the jury's award. The circuit court denied Clark's motion for a reduction of the judgment in the amount paid by Navigation to the plaintiffs pursuant to the joint tortfeasor release agreement.

Clark timely appealed to this court, followed shortly thereafter by the plaintiffs' timely cross-appeal.

II. STANDARDS OF REVIEW
A. Trial Court's Application Of The Law

"Pursuant to the right/wrong standard, a conclusion of law is not binding upon the appellate court and is freely reviewable for its correctness." State v. Soto, 84 Hawai'i 229, 236, 933 P.2d 66, 73 (1997) (citations omitted). See also In re Jane Doe, Born on May 22, 1976, 84 Hawai'i 41, 46, 928 P.2d 883, 888 (1996); Hirono v. Peabody, 81 Hawai'i 230, 232, 915 P.2d 704, 706 (1996); Zemis v. SCI Contractors, Inc./E.E. Black, Inc., 80 Hawai'i 442, 445, 911 P.2d 77, 80 (1996).

B. Directed Verdict

When we review the granting of a directed verdict, we apply the same standard as the trial court. Lussier v. Mau-Van Dev., Inc., 4 Haw.App. 359, 372, 667 P.2d 804, 815 (1983).

[A] directed verdict may be granted only when after disregarding conflicting evidence, giving to the [non-moving party's] evidence all the value to which it is legally entitled, and indulging every legitimate inference which may be drawn from the evidence in [the non-moving party's] favor, it can be said that there is no evidence to support a jury verdict in his [or her] favor.

Wakabayashi v. Hertz Corp., 66 Haw. 265, 271, 660 P.2d 1309, 1313 (1983) (quoting Stewart v. Budget Rent-A-Car Corp., 52 Haw. 71, 77, 470 P.2d 240, 244 (1970) (citations omitted)).

Weinberg v. Mauch, 78 Hawai'i 40, 49-50, 890 P.2d 277, 286-87, reconsideration denied, 78 Hawai'i 421, 895 P.2d 172 (1995) (brackets in original). See also Takayama v. Kaiser Found. Hosp., 82 Hawai'i 486, 495, 923 P.2d 903, 912 (1996); Carr v. Strode, 79 Hawai'i 475, 486, 904 P.2d 489, 500 (1995).

C. Jury Instructions

When jury instructions or the omission thereof are at issue on appeal, the standard of review is whether, when read and considered as a whole, the instructions given are prejudicially insufficient, erroneous, inconsistent, or misleading.

Erroneous instructions are presumptively harmful and are a ground for reversal unless it affirmatively...

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