Burnette v. Nicolet, Inc.

• Decision Date: 25 July 1986
• Docket Number: No. 84-2063,84-2063
• Citation: 818 F.2d 1098
• Parties: Prod.Liab.Rep.(CCH)P 11,080 James E. BURNETTE, Appellant, v. NICOLET, INC.; Eagle-Picher Industries, Inc.; The Celotex Corporation; Owens-Corning Fiberglass Corp.; Keene Corporation; Forty-Eight Insulation, Inc.; National Gypsum Company; Raymark Industries, Inc.; Carey Canada, Inc.; Covil Corporation; Pittsburgh Corning Corporation; H.K. Porter Company, Inc. and North Brothers an Unincorporated Division of National Service Industries, Inc., Appellees, COMBUSTION ENGINEERING, INC.; Amchem, Inc.; Rock Wool Manufacturing Co., Inc.; GAF Corporation; Fibreboard Corporation; Owens-Illinois, Inc.; Amatex Corporation; Unarco Industries, Inc.; Empire Ace Insulation Mfg. Corp.; Atlas Asbestos Company; W.R. Grace & Company; US Mineral Products Corporation and U.S. Gypsum Company, Defendants, v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1098

818 F.2d 1098

Prod.Liab.Rep.(CCH)P 11,080

James E. BURNETTE, Appellant, v.NICOLET, INC.; Eagle-Picher Industries, Inc.; The Celotex

Corporation; Owens-Corning Fiberglass Corp.; Keene

Corporation; Forty-Eight Insulation, Inc.; National Gypsum

Company; Raymark Industries, Inc.; Carey Canada, Inc.;

Covil Corporation; Pittsburgh Corning Corporation; H.K.

Porter Company, Inc. and North Brothers an Unincorporated

Division of National Service Industries, Inc., Appellees,

COMBUSTION ENGINEERING, INC.; Amchem, Inc.; Rock Wool

Manufacturing Co., Inc.; GAF Corporation; Fibreboard

Corporation; Owens-Illinois, Inc.; Amatex Corporation;

Unarco Industries, Inc.; Empire Ace Insulation Mfg. Corp.;

Atlas Asbestos Company; W.R. Grace & Company; US Mineral

Products Corporation and U.S. Gypsum Company, Defendants, v.UNITED STATES of America, Appellee.

No. 84-2063.

United States Court of Appeals Fourth Circuit.

Argued April 10, 1986.

Decided July 25, 1986.

Mona Lisa Wallace, Salisbury, N.C. (Blatt & Fales, Barnwell, S.C., on brief), for appellant.

Thomas N. Barefoot(Smith, Anderson, Blount, Dorsett, Mitchell & Jernigan, Raleigh, N.C., on brief), and Gerard H. Davidson, Jr.(Timothy Peck, Smith, Moore, Smith, Schell & Hunter, Greensboro, N.C., Richard V. Bennett, Bell, Davis & Pitt, Winston-Salem, N.C., on brief), for appellees.

Before PHILLIPS and SPROUSE, Circuit Judges, and HAYNSWORTH, Senior Circuit Judge.

JAMES DICKSON PHILLIPS, Circuit Judge:

PlaintiffJames Burnette appeals the district court's grant of two summary judgment motions in favor of defendants and dismissal of all of Burnette's claims.Invoking diversity and admiralty jurisdiction, Burnette filed this action alleging that he contracted asbestosis from exposure to asbestos-containing products manufactured by twenty-six named defendants.¹The district court ruled that plaintiff's diversity jurisdiction claims were barred by a North Carolina statute of repose.The court also dismissed Burnette's admiralty jurisdiction claims.

As to the diversity jurisdiction claims, we reverse on the authority of Hyer v. Pittsburgh Corning Corp., 790 F.2d 30(4th Cir.1986), andSilver v. Johns-Manville Corp., 789 F.2d 1078(4th Cir.1986), and remand the case to the district court for further proceedings.We affirm, however, the district court's dismissal of the admiralty jurisdiction claims on the authority of Oman v. Johns-Manville Corp., 764 F.2d 224(4th Cir.1985)(en banc).

I

Burnette has suffered intermittent exposure to asbestos throughout his working career from October 1943 until his retirement in late 1981, except from approximately 1946 to 1950 when he did not work in the insulation business.Burnette was first exposed to asbestos in his job as an insulator at the North Carolina Shipbuilding Co. in October 1943.Burnette's shipyard employment there comprised approximately 9% of the time he spent working as an insulator.He recalls seeing the products of only three defendants at the shipyard, however.All his work there was done on incompleted hulls sitting powerless on the water or in land-based construction shops.Burnette's other shipyard employment occurred in mid-1976 through 1981 when he worked briefly for the Norfolk Naval Shipyard in Portsmouth, Virginia.During that time, he made several trips to Virginia where his job involved removing old asbestos insulation and replacing it with asbestos-free insulation on the sides of the drydock.Burnette was unable, however, to identify the brand names or manufacturers of any of the asbestos products he removed during this time.

Burnette's non-shipyard employment involving exposure to asbestos-containing materials began in 1950 and ended in 1981 in his work as an insulator in the construction industry.However, Burnette admitted in his deposition that the insulation products which he installed were asbestos-free beginning in 1976 until the end of his career, though during that time he continued to remove previously installed asbestos insulation.He does not know the brand names or manufacturers of those products.

Burnette was first diagnosed as having an asbestos-related disease in December 1981.He filed this action on August 4, 1983, stating four causes of action pursuant to the court's diversity and admiralty jurisdiction, on the theories of negligent failure to warn, breach of implied warranty, strict liability, and fraudulent concealment and/or conspiracy.The defendants filed two motions for summary judgment on the ground that Burnette's diversity jurisdiction claims were barred by North Carolina's six-year product liability statute of repose, N.C. Gen. Stat. Sec. 1-50(6), and on the ground that the district court lacked admiralty jurisdiction over Burnette's claims.The lower court issued two memorandum decisions and a judgment granting the defendants' summary judgment motions and dismissing both Burnette's diversity and admiralty jurisdiction claims.In granting summary judgment on the diversity claims, the court ruled that plaintiff's action was barred by N.C. Gen. Stat. Sec. 1-50(6)² because Burnette's last exposure to any asbestos products occurred in 1976 and suit was not filed until 1983, thus exceeding the six-year period of repose.³The court dismissed Burnette's fraudulent concealment and civil conspiracy claims on the additional grounds that North Carolina does not recognize a cause of action for fraudulent concealment "except in cases involving fiduciary, contractual or similar relationships not applicable here" and that the dismissal of the fraud claim rendered moot the civil conspiracy claim.

In granting the defendants' motion for summary judgment on the admiralty claims, the court concluded that Burnette could not meet the jurisdictional test under 28 U.S.C.A. Sec. 1333(1) for either tort-based or contract-based claims.⁴In particular, as to the tort claims, the lower court determined that the plaintiff could establish neither that his injuries occurred in a maritime situs nor that the defendants' alleged tortious conduct bore a significant relationship to traditional maritime navigation and commerce.Executive Jet Aviation v. Cleveland, 409 U.S. 249, 93 S.Ct. 493, 34 L.Ed.2d 454(1972).As to the contract-based breach of implied warranty claim, the court reasoned that Burnette could not establish the existence of such warranty implied in a maritime contract.

Burnette's appeals from the district court's grant of these summary judgment motions were consolidated for review here.

II

We turn first to the question of diversity jurisdiction and the applicability of Sec. 1-50(6) to disease claims.In an appeal presenting the issue of whether Sec. 1-50(6) applies to an asbestos-related disease claim, Hyer v. Pittsburgh Corning Corp., 790 F.2d 30(4th Cir.1986), we held that Sec. 1-50(6), insofar as it constitutes a statute of repose, has no application to claims arising out of disease.See alsoSilver v. Johns-Manville Corp., 789 F.2d 1078(4th Cir.1986)(Sec. 1-50(6) does not bar action for wrongful death resulting from exposure to asbestos products).This holding was based upon our understanding of the North Carolina Supreme Court's opinion in Wilder v. Amatex Corp., 314 N.C. 550, 336 S.E.2d 66(1985).Accordingly, for the reasons set forth in Hyer, we are constrained to hold that on the facts as presented here, Sec. 1-50(6) does not bar Burnette's claims brought pursuant to diversity jurisdiction.

III

We affirm, however, the lower court's dismissal of two of Burnette's diversity claims for fraudulent concealment and civil conspiracy.Burnette premises his claim of fraudulent concealment upon the defendants' non-disclosure or failure to warn of material facts concerning the hazards of exposure to asbestos-containing products.The lower court found that North Carolina has never recognized a cause of action for fraudulent concealment in the absence of a relationship of trust or confidence created by a fiduciary, contractual or other similar relationship which imposes upon the defendant a "duty to speak" to the plaintiff.See, e.g., Vail v. Vail, 233 N.C. 109, 63 S.E.2d 202(1951)(mother and son relationship).We see no error in the court's conclusion that North Carolina would not recognize a relationship of trust or confidence in the context advocated by Burnette.⁵SeeStone v. McClam, 42 N.C.App. 393, 257 S.E.2d 78(1979).

Likewise, we find no error in the district court's determination that dismissal of Burnette's fraudulent conspiracy claim made...