Andrews v. John E. Smith's Sons Co.

• Decision Date: 23 March 1979
• Citation: 369 So.2d 781
• Parties: Phillip Mark ANDREWS v. JOHN E. SMITH'S SONS COMPANY, etc. 78-47.
• Court: Alabama Supreme Court

Page 781

369 So.2d 781

Phillip Mark ANDREWS v. JOHN E. SMITH'S SONS COMPANY, etc.

78-47.

Supreme Court of Alabama.

March 23, 1979.

Rehearing Denied April 20, 1979.

Johnnie B. Byrd, Jr., of Caffey & Byrd, Brewton, for appellant.

Bert S. Nettles and J. Harley McDonald, Jr., Mobile, for appellee.

William D. Melton, Evergreen, amicus curiae.

FAULKNER, Justice.

Andrews appeals from a summary judgment granted in favor of the defendant, Hobam, Inc., also referred to as John E. Smith's Sons Co., a division of Hobam, Inc. We affirm.

Andrews, an employee of Conecuh Quick Freeze, had his right arm amputated below the elbow following an accident at his place of employment in May, 1976. He was stuffing ground beef into a commercial meat grinder with his hand when it was caught and pulled into the grinding mechanism.

Suit was filed against "John E. Smith's Sons Co., a division of Hobam, Inc., a corporation" with service on Hobam, Inc. Count One was based on the Alabama Extended Manufacturer's Liability Doctrine and Count Two (which was struck) sounded in warranty. Here we are concerned only with the propriety of summary judgment for the defendant on Count One, which reads in its entirety:

"COMPLAINT

"This is a third party action under Title 26, Section 312, Code of Alabama 1940 (recompiled 1958) brought under the Alabama Extended Manufacturer's Liability Doctrine and also for breach of warranties under Title 7A, Code of Alabama.

"COUNT ONE

"1. On or about May 17, 1976, the Plaintiff was an employee of Conecuh Quick Freeze, Inc. in its packing house facilities in Evergreen, Conecuh County, Alabama, where the Plaintiff had to use a meat grinding machine which had been designed, manufactured, inspected, sold, distributed, repaired and/or placed in the stream of commerce by the Defendants John E. Smith's Sons Company, a Division of Hobam, Inc., a corporation; and the following Defendants whose names will be supplied by amendment when ascertained: ABC Partnership, XYZ, Inc., a corporation and John Doe and Richard Roe.

"2. That on or about the above mentioned date the Plaintiff's right arm became caught in said meat grinding machine and the Plaintiff sustained a traumatic amputation of the right arm below the elbow, causing great pain and mental suffering and permanent disfigurement and disability. The Plaintiff was caused to be hospitalized to seek medical attention and to incur expenses thereby and will be caused to incur such expenses in the future. The Plaintiff has also lost wages as the result of his injury and will be prevented in the future from pursuing other occupations which would require the use of his right arm, and the Plaintiff will incur great economic losses thereby. The Plaintiff has been permanently deprived of his right arm and will always suffer from the loss thereof and from the attendant mental anguish.

"3. The Plaintiff avers that his injuries were the direct and proximate consequence of the negligence of the Defendants in designing, manufacturing, inspecting, selling, marketing, distributing, repairing and/or placing in the stream of commerce said grinding mill in a defective condition which rendered it unreasonably dangerous to the Plaintiff as the ultimate user thereof or consumer thereof, in that the Plaintiff was exposed to an unreasonable risk of injury to his arm while using said machine for the purpose and in the manner for which it was intended or expected by Defendants. Said Defendants were engaged in the business of designing, manufacturing, inspecting, selling, distributing and/or repairing said product. The Defendants placed the said product in the stream of commerce with the reasonable expectation that it would reach the Plaintiff as the ultimate user or consumer thereof. Said product reached the user or consumer without substantial change in the condition in which it was sold; and that if there was any change in the condition, nature or the use in said product by the Plaintiff or anyone else, said change was anticipated and expected by the Defendants.

"WHEREFORE, Plaintiff demands judgment against the Defendants John E. Smith's Sons Company, a Division of Hobam, Inc., a corporation; ABC Partnership; XYZ, Inc., a corporation and John Doe and Richard Roe in the sum of $500,000.00 and costs."

Through discovery it was learned that the meat grinder was manufactured and sold by John E. Smith's Sons Co., a close corporation, probably in 1949. The grinder did not have a guard over the opening to prevent feeding meat with the hand, nor did it have a stomper or mallet with which to feed and stuff the grinder, although other grinders marketed at the time by Smith Co. had these safety features.

In 1962 Smith sold substantially all its assets for cash, including accumulated good will, orders, repair contracts, and services to Hobam, Inc., who styled themselves "John E. Smith's Sons Co., a division of Hobam, Inc., since 1868." Two members of the Smith family retired at the sale, but otherwise the business operation of the company remained the same, with the same physical plant and employees. The sale included a non-competition agreement and there was no participation in management decisions or profits by the predecessor corporation after 1962. Hobam received all patents, including one on the grinder in question and the safety devices used on similar models. Within the last several years Hobam has sold replacement parts to Conecuh Quick Freeze for this particular meat grinder.

After the transfer of assets the predecessor corporation changed its name to 66 Highland Ave., Inc., by amending its Certificate of Incorporation, and it continued in existence De facto as well as De jure until it was liquidated in 1975. Under the terms of the purchase agreement 66 Highland Ave., Inc., specifically retained liability for all products liability claims on machines sold prior to June 30, 1962. 66 Highland Ave., Inc., continued to maintain product liability insurance until June, 1977, to cover claims arising over this machinery. The coverage was in effect at the time of Andrews' accident. Upon obtaining this information regarding the sale of assets Andrews substituted 66 Highland Ave., Inc., as a defendant. It appears, however, that the plaintiff has been unable to serve this corporation. No other amendments to the complaint were made.

Andrews presents three theories to attack the summary judgment: (1) Hobam is liable as the supplier of component replacement parts for a defectively designed machine; (2) Hobam is liable for failure to warn third persons of obvious defects of which it was aware in its predecessor corporation's product; and (3) Hobam is liable for defects in its predecessor's product since Hobam is a mere continuation of the original manufacturer.

Andrews' first theory misconstrues the concept of liability for defective component parts. Under Casrell v. Altec Industries, Inc., 335 So.2d 128 (Ala.1976), and Atkins v. American Motors Corp., 335 So.2d 134 (Ala.1976), a manufacturer who uses component parts in manufacturing or assembling a product for sale as a complete unit may be liable under appropriate circumstances where the defect is in a component part. But Hobam is not in this instance manufacturing products in this fashion. It has simply made replacement parts which were not alleged to be defective in themselves. The...