Bailey v. Cottrell, Inc.

• Decision Date: 16 December 2011
• Docket Number: No. A11A1180.,A11A1180.
• Parties: BAILEY et al. v. COTTRELL, INC.
• Court: Georgia Court of Appeals

11 FCDR 3910

12 FCDR 19

313 Ga.App. 371

721 S.E.2d 571

BAILEY et al.

v.COTTRELL, INC.

No. A11A1180.

Court of Appeals of Georgia.

Nov. 29, 2011.Reconsideration Denied Dec. 16, 2011.

Garland, Samuel & Loeb, David Edward Tuszynski, Atlanta, for appellants.

Hulsey, Oliver & Mahar, Abbott Swift Hayes, Jr., Gainesville, Smith, Gambrell & Russell, Melanie Stephens Stone, for appellee.

ADAMS, Judge.

In this products liability case, appellants Steve Bailey and Laura Bailey appeal the trial court's order granting summary judgment under Indiana law to Cottrell, Inc. in the Baileys' suit to recover for injuries Steve Bailey sustained when he fell from the top level of a car-hauler/tractor-trailer rig. Because we find that the trial court erred in failing to apply Georgia law to the Baileys' claims, we reverse.

At all pertinent times, the Baileys were residents of Missouri. Cottrell, Inc. is a Georgia corporation engaged in the design, development and manufacture of car hauling equipment. Steve Bailey worked as a driver for a car-hauling company, Jack Cooper Transport (“JCT”), out of Wentzville, Missouri. The accident at issue occurred in Indiana on October 28, 2005, while Steve Bailey was loading pickup trucks onto his assigned car-hauler, a 1998 Cottrell rig owned by JCT. After Bailey loaded an extended-cab pickup truck with a camper top onto an area called the “headramp,” which is located on top of the tractor, he stepped out of the pickup to dismount from the headramp's upper level. Steve Bailey, who was wearing work gloves, stuck his right fingers into the top of the doorjamb above the rear door of the pickup, while closing the pickup's driver door with his left hand. As Steve Bailey closed the door, the air from inside the pickup blew against his right hand, dislodging his fingers. Losing his grip, he fell backward onto the parking lot surface below. Steve Bailey asserts that he sustained traumatic injuries in the fall that have left him disabled.

The Baileys allege that the car-hauler Steve Bailey was using was designed, manufactured and sold by Cottrell with inadequate space for maneuvering and with no fall prevention devices, such as safety chains or grab bars on the rig's upper level, despite the fact that Cottrell knew that drivers like Steve Bailey would be required to load and unload automobiles from that area. Cottrell counters that Steve Bailey had knowledge of these supposed defects in the rig, as well as the knowledge of the specific risks of falling, and that he understood, appreciated and assumed these risks. The trial court, applying Indiana law, found that Steve Bailey voluntarily assumed the risk of working on the upper level of the car hauler and granted Cottrell's motion for summary judgment.

“On appeal from the grant of summary judgment this Court conducts a de novo review of the evidence to determine whether there is a genuine issue of material fact and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law.” (Citations omitted.) Campbell v. The Landings Assn., 289 Ga. 617, 618, 713 S.E.2d 860 (2011).

1. The Baileys first argue that the trial court erred in applying Indiana law to their claims. Although the injury occurred in Indiana and the Baileys acknowledge that Georgia generally applies lex loci delecti (the law of the place where the tort was committed), they assert that the trial court should have applied the public policy exception to the general rule. The Baileys contend that Indiana law violates Georgia public policy in two respects: (1) Indiana law does not allow a strict liability claim for a product design defect with a risk-utility test, while Georgia does; and (2) Indiana law, as applied by the trial court, eliminated the voluntariness element for an assumption of risk defense, which they contend contravenes Georgia public policy.

In Georgia, “[u]nder lex loci delicti, tort cases are governed by the substantive law of the state where the tort or wrong occurred—in this case, [Indiana].” (Footnote omitted.) Bagnell v. Ford Motor Co., 297 Ga.App. 835, 836(1), 678 S.E.2d 489 (2009). See also Dowis v. Mud Slingers, 279 Ga. 808, 816, 621 S.E.2d 413 (2005) (reaffirming lex loci delecti as the law in Georgia). But as the Baileys correctly note, Georgia recognizes a public policy exception to the rule of lex loci delecti.

Even if an application [of the rule of lex loci delicti] renders the law of another state applicable, the forum, within constitutional limits, is not required to give the law of another state extra-territorial effect. That is only done as a matter of courtesy or comity, which will not be enforced if the law of the other state contravenes the public policy of the forum. See OCGA § 1–3–9; Commercial Credit Plan v. Parker, 152 Ga.App. 409, 263 S.E.2d 220 (1979).

Fed. Ins. Co. v. Nat. Distrib. Co., 203 Ga.App. 763, 765–766, 417 S.E.2d 671 (1992).

(a) Georgia law recognizes a product liability claim based upon strict liability against “those actively involved in the design, specifications, or formulation of a defective final product or of a defective component part which failed during use of a product and caused injury.” (Citation omitted.) Davenport v. Cummins Alabama, Inc., 284 Ga.App. 666, 671(1), 644 S.E.2d 503 (2007). See OCGA § 51–1–11. Indiana law, however, does not recognize a strict liability claim for design defects:

The Indiana Product Liability Act generally imposes strict liability for physical harm caused by a product in an unreasonably dangerous defective condition. Ind.Code § 34–20–2–1. For actions based on an alleged product design defect, however, the Act departs from strict liability and specifies a different standard of proof: “(T)he party making the claim must establish that the manufacturer or seller failed to exercise reasonable care under the circumstances in designing the product.” Ind.Code § 34–20–2–2.

TRW Vehicle Safety Systems v. Moore, 936 N.E.2d 201, 209(1) (Ind.Sup.2010) (declining to expand the statutory standard of care for product liability claims alleging a design defect). Thus, Indiana only recognizes a negligent design defect claim. Id. at 214(5). The issue before us, therefore, is whether this distinction in Indiana law violates Georgia public policy. We conclude that it does.

In Alexander v. Gen. Motors Corp., 267 Ga. 339, 478 S.E.2d 123 (1996), “Alexander was injured while driving in Virginia when the driver's seat of his General Motors [“GM”] vehicle, purchased new in Georgia, failed in a collision and caused him to be ejected from the vehicle.” The trial court, applying Virginia's substantive law under lex loci delecti, dismissed Alexander's strict liability claims because the State of Virginia did not recognize strict liability. This Court affirmed the trial court's application of Virginia law. Alexander v. Gen. Motors Corp., 219 Ga.App. 660, 466 S.E.2d 607 (1995). But the Supreme Court reversed, holding that Virginia law contravened the public policy underlying OCGA § 51–1–11, which “was intended to protect those who are injured by defective products placed in the stream of commerce in this state” and that Alexander was entitled to have Georgia law applied to his claims against GM. Alexander v. Gen. Motors Corp., 267 Ga. at 340–341, 478 S.E.2d 123.

Although Indiana recognizes strict liability for manufacturing claims, its failure to recognize a strict liability claim for design defects presents a substantive legal difference. A claim of negligence in an Indiana defective design product liability case differs from a strict liability claim in Georgia in that Georgia has specifically adopted the risk-utility test for determining strict liability as to such claims, while the State of Indiana has specifically rejected this test in favor of a common law negligence analysis. Compare Banks v. ICI Americas, 264 Ga. 732, 734–735, 450 S.E.2d 671 (1994) (adopting risk-utility analysis set out in Preliminary Draft No. 1 (April 20, 1993) Restatement (Third) of Torts: Products Liability, § 101, Reporters' Notes to Comment G) with TRW Vehicle Safety Systems v. Moore, 936 N.E.2d at 209, n. 2 (rejecting risk-utility test under Restatement (Third) of Torts: Products Liability § 2(b) (1997)). This is not a distinction without a difference. The application of the risk-utility test in Georgia allows the factfinder to consider a number of factors, Banks, 264 Ga. at 736(1), n. 6, 450 S.E.2d 671, an approach that the Supreme Court of Indiana has rejected. Although the Supreme Court of Georgia recognized in Banks that the risk-utility analysis for design defect claims overlaps to a certain extent with a negligence analysis, the Court also stated that “we cannot agree that the use of negligence principles to determine whether the design of a product was ‘defective’ necessarily obliterates under every conceivable factual scenario the distinction Georgia law has long recognized between negligence and strict liability theories of liability.” (Citations omitted.) Id. at 735, n. 3, 450 S.E.2d 671. And since Banks, this Court has reiterated that Georgia's strict liability law focuses “not on whether the manufacturer negligently failed to use due care but on whether the marketed product was defective” ¹ and has “continued to honor” the distinction between negligence and strict liability for design defect claims. (Citations omitted.) S K Hand Tool Corp. v. Lowman, 223 Ga.App. 712, 715, 479 S.E.2d 103 (1996).

This comparison demonstrates that Indiana law and Georgia law are sufficiently dissimilar that applying Indiana law in this case would contravene the public policy of this State as expressed in OCGA § 51–1–11, and the Baileys are entitled to have Georgia law, including Georgia law regarding any defenses to such a claim, e.g., assumption of risk, applied to their claims against Cottrell. See Alexander v. Gen. Motors Corp., 267 Ga. at 340, 478 S.E.2d 123.

(b) Cottrell...