Alm v. Aluminum Co. of America

• Decision Date: 02 July 1986
• Docket Number: No. C-4093,C-4093
• Parties: , Prod.Liab.Rep. (CCH) P 11,142 James E. ALM, Petitioner, v. ALUMINUM COMPANY OF AMERICA et al., Respondents.
• Court: Texas Supreme Court

Page 588

717 S.W.2d 588

55 USLW 2080, Prod.Liab.Rep. (CCH) P 11,142

James E. ALM, Petitioner, v. ALUMINUM COMPANY OF AMERICA et al., Respondents.

No. C-4093.

Supreme Court of Texas.

July 2, 1986.

Rehearing Denied Nov. 5, 1986.

W. Douglas Matthews, Timothy F. Lee, Schmidt & Matthews, P.C., Houston, for petitioner.

Michael Connelly, Mayor, Day & Caldwell, Houston, for respondents.

KILGARLIN, Justice.

James Alm presents three issues for decision by this court: (1) whether Aluminum Company of America (Alcoa), the designer of a closure system for soft drink bottles, had a duty to warn consumers of the hazard of bottle cap blow off; (2) whether the trial court properly disregarded the jury's findings of gross negligence; and, (3) whether the court of appeals applied the correct legal standards in reviewing the factual sufficiency of the evidence supporting the jury's finding of ordinary negligence.

The trial court rendered judgment for Alm based on the jury's favorable verdict. The court of appeals, with one justice dissenting, reversed that judgment, holding that the evidence pertaining to certain alleged acts of negligence was factually insufficient to support the jury finding against Alcoa. Additionally, the court of appeals held that Alcoa did not have a duty to warn consumers of the hazard of bottle cap blow off. 687 S.W.2d 374. We reverse the judgment of the court of appeals in part and affirm it in part.

During the 1960's, Alcoa designed, patented, manufactured, and marketed a closure system for applying aluminum caps to carbonated soft drink bottles. In 1969, Alcoa sold such a capping machine to JFW Enterprises, Inc., the owner of the Houston 7-Up Bottling Company. The capping machine applied Alcoa-designed 28 millimeter pilfer-proof aluminum caps to soft drink bottles of various sizes. JFW purchased the aluminum capping material from W.H. Hutchinson & Son, Inc. W.H. Hutchinson manufactured the Alcoa-designed and patented resealable caps under licensing agreements with Alcoa.

On June 3, 1976, James Alm suffered a severe eye injury when an aluminum bottle cap exploded off a 32-ounce bottle of 7-Up. Alm had purchased the bottle of 7-Up at a Lewis and Coker supermarket. Lewis and Coker had purchased the bottle from JFW Enterprises.

Alm sued Lewis and Coker, JFW, and Alcoa under theories of strict liability and negligence but settled with Lewis and Coker and JFW before trial. Alcoa filed a cross-action against JFW and Lewis and Coker. The jury found against Alcoa on all the submitted liability issues. However, the trial court disregarded the jury's answers to special issues 1 through 6, stating that strict product liability did not apply to Alcoa. The trial court also disregarded the jury's answers to issues 11 and 12, finding the answers were "against the great weight and overwhelming preponderance of the evidence." In issue 11, the jury found Alcoa was grossly negligent, and in issue 12, it awarded Alm one million dollars in exemplary damages. The trial court rendered judgment on the jury's answers to the remaining issues, which found Alcoa 55% negligent and JFW 45% negligent. Alm was awarded $300,500 as his actual damages.

The question of Alcoa's negligence was broadly submitted in one issue. The court of appeals set out and considered four alleged acts of negligence by Alcoa:

(1) Alcoa negligently designed the bottle and cap in that the threads on the bottle to be impressed into the cap were too shallow;

(2) Alcoa negligently designed the cap by including an optional pilfer-proof band on the cap;

(3) Alcoa was negligent in recommending to bottlers a visual inspection system based upon the batch and hold principle of quality control, as opposed to inventing or devising some fail safe system of inspection for use by bottlers;

(4) Alcoa was negligent in failing to adequately warn the bottler (JFW) and/or the plaintiff about the risk that an improperly applied cap could blow-off and cause personal injury.

687 S.W.2d at 378. The court of appeals concluded the evidence was factually insufficient to support a finding of negligence as to the first three alleged acts. As to whether Alcoa was negligent in failing to warn JFW and/or Alm, the court of appeals held that Alcoa had no duty to warn Alm. The court held Alcoa did have a duty to warn JFW, but concluded the jury had impliedly found that Alcoa's warning to JFW was adequate. ¹ 687 S.W.2d at 382.

Alm contends that Alcoa owed a duty to warn consumers such as himself of the hazard of bottle cap blow off. It is a long standing principle in this state that a duty of care arises when conditions are such that a "prudent person would have anticipated and guarded against the occurrence which caused" another's injury. St. Louis Southwestern Ry. Co. of Texas v. Pope, 98 Tex. 535, 865 S.W. 57 (1905). As this court recently stated, a person has a duty to act as a "reasonable prudent person would act under the same or similar circumstances regarding any reasonably forseeable risk." Colvin v. Red Steel Co., 682 S.W.2d 243 (Tex.1984).

Alcoa argues that it owed no duty to warn Alm as it was not the manufacturer or seller of any component part or the final product which injured Alm. Alcoa was, however, the designer and marketer of the closure process, the designer of the cap, and the designer, manufacturer, and seller of the capping machine.

ALCOA AS DESIGNER

Whether a designer who is not a manufacturer has a duty to warn of hazards associated with the use of its designed product has not before been addressed by this court. A manufacturer has long been A manufacturer, as well as all suppliers of a product, also has a duty to inform users of hazards associated with the use of its products. Restatement (Second) of Torts § 388 (1965); Olivarez v. Broadway Hardware, Inc., 564 S.W.2d 195 (Tex.Civ.App.--Corpus Christi 1978, writ ref'd n.r.e.). There is no reason to distinguish a designer, who has intimate knowledge of a designed product, from a retailer, wholesaler or manufacturer. Alcoa designed the closure system. It is the failure of that system which caused Alm's injury. There can be no justification for requiring a user of Alcoa's closure technology to warn of its hazards while not holding Alcoa to the same duty. The issue in a negligent failure to warn case is simply whether a reasonably prudent person in the position of the designer would warn of hazards associated with the designed product. Alcoa had a duty to warn of the hazards associated with its closure technology if a reasonably prudent person in the same position would have warned of the hazards.

held to have a duty to exercise ordinary care in the design of a product. Gonzales v. Caterpillar Tractor Co., 571 S.W.2d 867 (Tex.1978). A designer who is not also the manufacturer should share the same duty to develop a safe design. Alcoa has a duty to exercise ordinary care in the design of its closure system. In fact, Alcoa does not dispute that it owes Alm a duty to design its closure system in a non-negligent way.

ALCOA AS MANUFACTURER

While no Texas court has ever held a manufacturer precisely in the position of Alcoa liable, at least one court of another jurisdiction has. In Fabbrini Foods, Inc. v. United Canning Corp., 90 Mich.App. 80, 280 N.W.2d 877 (1979), the plaintiff recovered against three defendants, including the designer/manufacturer of a filling machine used by a mushroom canner. The plaintiff had received contaminated mushroom cans produced by the canning machine. Alcoa's position as a remote manufacturer of the capping machine should not insulate it from liability when its negligence proximately causes damages.

Alcoa supplied a capping machine to JFW. Alcoa knew that through use its capping machine would go out of adjustment, thereby causing misapplied caps. And Alcoa knew of the risk of personal injury from bottle cap blow off at least as early as 1970. Alcoa had a duty to warn users of the hazard of improperly applied caps.

Alcoa argues and the court of appeals held that Alcoa satisfied its duty to warn of the hazard of bottle cap blow off by adequately warning JFW. We agree that a manufacturer or supplier may, in certain situations, depend on an intermediary to communicate a warning to the ultimate user of a product. However, the mere presence of an intermediary does not excuse the manufacturer from warning those whom it should reasonably expect to be endangered by the use of its product. The issue in every case is whether the original manufacturer has a reasonable assurance that its warning will reach those endangered by the use of its product. Hopkins v. Chip-In-Saw, Inc., 630 F.2d 616 (8th Cir.1980); Gordon v. Niagara Machine and Tool Works, 574 F.2d 1182 (5th Cir.1978); Borel v. Fiberboard Paper Products Corp., 493 F.2d 1076 (5th Cir.1973); Doss v. Apache Powder Co., 430 F.2d 1317 (5th Cir.1970); Weekes v. Michigan Chrome and Chemical Co., 352 F.2d 603, 607 (6th Cir.1965).

In some situations, courts have recognized that a warning to an intermediary fulfills a supplier's duty to warn ultimate consumers. For example, when a drug manufacturer properly warns a prescribing physician of the dangerous propensities of its product, the manufacturer is excused from warning each patient who receives the drug. Cooper v. Bowser, 610 S.W.2d 825, 830-31 (Tex.Civ.App.--Tyler 1980, no writ); Gravis v. Parke-Davis and Co., 502 S.W.2d 863, 870 (Tex.Civ.App.--Corpus Christi 1973, writ ref'd n.r.e.). The doctor stands as a learned intermediary between the manufacturer and the ultimate consumer.

                Generally, only the doctor could understand the propensities and dangers involved in the use of a given drug.  Gravis, 502 S.W.2d at 870.   In this situation, it is reasonable for the manufacturer to rely on the intermediary to pass on its warnings.  However, even in these circumstances, when the warning to the intermediary is inadequate or misleading, the manufacturer remains liable for injuries

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