Oberg v. Honda Motor Co., Ltd.

Decision Date27 July 1993
Citation851 P.2d 1084,316 Or. 263
Parties, 61 USLW 2743, Prod.Liab.Rep. (CCH) P 13,548 Karl L. OBERG, Respondent on Review, v. HONDA MOTOR CO., LTD.; Honda R & D Co., Ltd.; and American Honda Motor Co., Inc., Petitioners on Review. CC A8709-05897; CA A61587; SC S38436.
CourtOregon Supreme Court

Jeffrey R. Brooke, of Bowman and Brooke, Phoenix, AZ, argued the cause and filed the petition for petitioners on review. With him on the petition were Paul G. Cereghini, Phoenix, AZ, and Thomas W. Brown and James H. Gidley, of Cosgrave, Vergeer & Kester, Portland.

William A. Gaylord, of Gaylord & Eyerman, P.C., Portland, argued the cause for respondent on review and filed a response to the petition. With him on the response were Doris J. Brook and Raymond F. Thomas, of Royce, Swanson & Thomas, Portland.

Jonathan M. Hoffman, of Martin Bischoff, Templeton, Langslet & Hoffman, Portland; and Malcolm E. Wheeler, of Parcel, Mauro, Hultin & Spaanstra, P.C., Denver, CO, filed a brief on behalf of amici curiae Product Liability Advisory Council, Inc.; The Motor Vehicles Mfrs. Ass'n of the U.S., Inc.; The Chamber of Commerce of the U.S. National Ass'n of Mfrs. of the U.S. of America; Business Roundtable; and Chemical Mfrs. Ass'n.

Mildred J. Carmack and Ridgway K. Foley, Jr., P.C., of Schwabe, Williamson & Wyatt, Portland; and James N. Westwood, of Miller, Nash, Wiener, Hager & Carlsen, Portland, filed a brief on behalf of amicus curiae Oregon Association of Defense Counsel.

David A. Engels, of Banks, Newcomb & Engels, Portland, filed a brief on behalf of amici curiae Consumer Federation of America; U.S. Public Interest Research Group; Oregon State Public Interest Research Group; Portland Family Head Injury Support Group; Oregon Trial Lawyers Ass'n; and The Southern Poverty Law Center.

James H. Clarke, of Lane Powell Spears Lubersky, Portland, filed a brief on behalf of amici curiae Snap-On Tools Corp.; Tim Kash; and Ray Park.

GRABER, Judge.

This case involves a product liability claim against defendants, who manufactured and sold a 1985 Honda Model ATC350X three-wheeled all-terrain vehicle (ATV) used by plaintiff. Plaintiff attempted to drive the ATV up a steep embankment; it overturned backward, injuring him. Plaintiff then brought this action against defendants, alleging that they were negligent in manufacturing, distributing, and selling the ATV, because they knew or should have known that it had an inherently dangerous design that rendered it unreasonably dangerous to users, and alleging strict liability.

A jury returned a verdict in favor of plaintiff, awarding both general and punitive damages. 1 Defendants appealed. They argued, among other things, that the trial court erred in admitting in evidence excerpts of various documents generated by the Consumer Product Safety Commission (CPSC), 2 relating to the safety of ATVs. Defendants also argued that the trial court erred in denying their motion for a new trial on the basis of the discovery of new eyewitnesses to plaintiff's accident. Finally, they argued that the award of punitive damages was excessive and, therefore, violated their rights under Article I, section 16, of the Oregon Constitution 3 and the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States. 4

The Court of Appeals held that the trial court did not err in admitting the excerpts from the CPSC documents, because that evidence was used for the limited and relevant purpose of showing defendants' knowledge of the allegedly dangerous characteristics of ATVs. Oberg v. Honda Motor Co., 108 Or.App. 43, 47-48, 814 P.2d 517 (1991). The Court of Appeals also held that the trial court did not err in denying defendants' motion for a new trial on the basis of the discovery of new eyewitnesses to plaintiff's accident, because the trial court was entitled to find that the newly discovered evidence probably would not have changed the verdict. Id. at 55-56, 814 P.2d 517. With respect to punitive damages, the court held that the award did not violate defendants' rights under Article I, section 16, of the Oregon Constitution, because that provision "does not apply in civil actions between private parties." Id. at 49-50, 814 P.2d 517. Finally, the court held that the award of punitive damages did not violate defendants' rights under the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States. Id. at 50-55, 814 P.2d 517. We affirm the decision of the Court of Appeals.

ADMISSIBILITY OF CPSC DOCUMENTS

Defendants first argue that the trial court erred in allowing plaintiff to read to the jury excerpts from nine CPSC documents. The documents included seven CPSC internal staff memoranda on the safety of ATVs; a CPSC notice of proposed rulemaking and request for comments and data relating to the safety of ATVs; and a CPSC press release concerning ATV-related accidents and injuries.

A. Relevance

During the hearing on defendants' motion in limine to exclude documents generated by the CPSC, plaintiff argued that the disputed material was relevant to show that defendants had "notice" of the alleged dangerousness of ATVs and that the material was, therefore, relevant to two issues: the foreseeability of plaintiff's injury and defendants' reaction to the notice as bearing on punitive damages.

OEC 401 provides:

" 'Relevant evidence' means evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence."

OEC 402 provides:

"All relevant evidence is admissible, except as otherwise provided by the Oregon Evidence Code, by the Constitutions of the United States and Oregon, or by Oregon statutory and decisional law. Evidence which is not relevant is not admissible."

Defendants do not challenge the authenticity of the CPSC documents, and they stipulated that they had received each of the documents from which plaintiff read excerpts, at approximately the time of its publication. Defendants do not argue that their knowledge of ATVs' potential instability was irrelevant to the issues at trial. Rather, they argue that the other ATVs and the other accidents described in the disputed documents were so unlike this ATV and this accident that knowledge of the documents did not give defendants notice of anything relevant.

First, defendants contend that the ATVs that were the subject of the CPSC documents were not "substantially similar" to the Honda ATV that allegedly caused the injury in this case. We are unpersuaded. The CPSC documents dealt with ATVs as a class of vehicles. As one of the documents stated, vehicles of that class are of similar design. The trial court was entitled to find that the ATVs that were the subject of the CPSC documents were sufficiently similar to the ATV that caused the injury in this case to provide notice to defendants of danger to persons in plaintiff's position.

Second, defendants contend that the accidents that were referred to or described in the CPSC documents were not "substantially similar" to the accident that caused plaintiff's injury here. Again, we disagree with defendants' contention. One of the excerpts at issue concerned reports of the instability of ATVs as a class. Another concerned reports showing a "pattern of loss of control" specifically associated with ATVs manufactured by Honda. Three excerpts concerned reported incidents in which ATVs overturned backward, and three others more specifically concerned incidents in which ATVs overturned backward while climbing hills. As noted, the ninth excerpt concerned the similarity in configuration among all brands of ATVs. The trial court was entitled to find that the prior occurrences that were described in those excerpts were sufficiently similar to the accident at issue in this case to make those occurrences relevant.

In summary, the excerpts from the CPSC documents, admitted by the trial court, were relevant to issues at trial. The trial court did not err in so holding.

B. Hearsay

We next consider defendants' argument that, even if the excerpts from the CPSC documents were relevant to the issue whether defendants had notice of the dangerousness of the product, those excerpts were inadmissible because they were hearsay. OEC 801(3) provides:

" 'Hearsay' is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted."

Defendants' hearsay objections were not well taken, because the excerpts from the CPSC documents were not offered to prove the truth of the matters asserted therein. Rather, those excerpts were offered for the limited and proper purpose of showing that defendants had knowledge of the potential dangerousness of ATVs. See Kirkpatrick, Oregon Evidence 484-85 (2d ed. 1989) ("[m]any out-of-court statements may be received in evidence because they are not being offered for the truth of the matter asserted," but for some other purpose, including the purpose of showing that the recipient of the statement had knowledge of the matter asserted therein).

It is clear that the trial court admitted the documents for the limited purpose for which plaintiff offered them. The court gave the following instruction just before the excerpts of CPSC documents were read to the jury:

"Jurors, I am now going to permit plaintiff's counsel to read to you excerpts from some documents of the federal agency. The documents that I will allow plaintiff's counsel to read to you are not admitted for the purpose of establishing the truth of the statements contained in those documents. That means that you should not assume that the statements in those documents are true.

"These documents are admitted for the limited purpose of notice. Plaintiff has...

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