Cavan v. General Motors Corp.

• Decision Date: 29 November 1977
• Citation: 280 Or. 455,571 P.2d 1249
• Parties: Bill L. CAVAN, Appellant, v. GENERAL MOTORS CORPORATION, a corporation, Respondent, White Motor Company, Defendant, Interstate Tractor & Equipment Co., and I. T. & E. Liquidating Co., Respondents.
• Court: Oregon Supreme Court

Page 1249

571 P.2d 1249

280 Or. 455

Bill L. CAVAN, Appellant, v. GENERAL MOTORS CORPORATION, a corporation, Respondent, White Motor Company, Defendant,

Interstate Tractor & Equipment Co., and I. T. & E.

Liquidating Co., Respondents.

Supreme Court of Oregon.

Argued and Submitted Oct. 4, 1977.

Decided Nov. 29, 1977.

James B. Griswold, of Green & Griswold, Portland, argued the cause for appellant. With him on the briefs was Michael R. Shinn, Portland.

David W. Axelrod, Portland, argued the cause for respondent I. T. & E. Liquidating Co. E. Joseph Dean, Portland, argued the cause for respondent General Motors Corporation. With them on the brief were Souther, Spaulding, Kinsey, Williamson &amp Schwabe, Wayne A. Williamson, and Ridgway K. Foley, Jr., Portland, Davies, Biggs, Strayer, Stoel & Boley, and Phillip D. Chadsey, Portland.

No appearance for respondent Interstate Tractor and Equipment Co.

Before DENECKE, C. J., and HOLMAN, HOWELL, BRYSON, LENT and LINDE, JJ.

HOLMAN, Justice.

This is an action for personal injuries suffered in a crawler tractor accident in September 1973. Plaintiff was injured due to his being thrown from the tractor when its engine died and its brakes failed to operate. The tractor had been manufactured by defendant General Motors Corporation and sold to defendant Interstate Tractor and Equipment Company in July 1964. In August 1964 Interstate sold the tractor to plaintiff's employer, Houghton Logging Company. Plaintiff filed his complaint on August 29, 1975. The trial court granted summary judgment for defendants on the basis of ORS 12.115, the statute of ultimate repose, which places a ten-year limitation on the bringing of certain actions.

The first count of plaintiff's complaint alleges negligence in several respects on the part of defendants. By its express terms, ORS 12.115 bars an action for negligently inflicted injury brought more than ten years "from the date of the act or omission complained of." Since plaintiff filed his complaint more than ten years following the manufacture and sale of the tractor, plaintiff must depend upon some other acts of defendants in order to prevail.

In Josephs v. Burns and Bear, 260 Or. 493, 491 P.2d 203 (1971), we rejected the argument that the effect of the statute could be avoided by an allegation that the defendant breached a continuing duty to warn of the dangers or defects of a product. We did not express an opinion as to the situation where "an active, continuous relationship between plaintiff and defendant exists from the time of the negligent acts to a time within the period during which an action is permitted." Josephs v. Burns and Bear, supra at 501-02, 491 P.2d at 207. Plaintiff contends that this is such a case and that we should resolve the reserved issue in his favor. Since we do not believe that this case presents the type of situation reserved in Josephs, we disagree.

The record discloses no "active, continuous relationship" between plaintiff and defendants or between plaintiff's employer and defendants. The only evidence pointed out as establishing the existence of a continued relationship shows that in 1968 defendants provided Houghton Logging Company with an add-on emergency brake actuator designed to remedy the problem which allegedly led to the injury complained of here. This actuator was placed upon another, similar piece of equipment and failed to work satisfactorily. This single occurrence is not illustrative of the situation reserved in Josephs. The transaction in question here is a normal sale of goods.

In Josephs we withheld consideration of situations in which the plaintiff is in a relationship of trust and confidence with the defendant and in which continued treatment or other ongoing resort to the skills of the defendant is required. The classic example is the doctor-patient relationship. See Hutchinson v. Semler, 227 Or. 437, 443-44, 361 P.2d 803, 362 P.2d 704 (1961). In cases such as this the potential plaintiff may be in no position of independence to recognize fairly the existence of a cause of action until the relationship is terminated. Such a situation may call for a different application of the policies behind a statute of limitations or statute of ultimate repose. ¹ An ordinary contract relationship for the sale of goods does not call for the imposition of a special rule.

Plaintiff further argues that ORS 12.115 does not bar his second count, which seeks to impose liability on defendants by virtue of their sale of a dangerously defective or "ultrahazardous" product. Although the statute by its terms applies only to negligently inflicted injury, in Johnson v. Star Machinery, 270 Or. 694, 530 P.2d 53 (1975), we held the statute applicable to cases based on products liability brought in accordance with Restatement (Second) of Torts, § 402A. Insofar as plaintiff's second count is premised on § 402A, it is therefore also barred. Plaintiff, however, seeks to avoid this result by contending that the defective tractor produced an "ultrahazardous condition," since the brakes would not function properly when the engine was off.

This argument stems from the distinction we made in Johnson between cases founded on negligence or strict products liability and those based on the ultrahazardousness ² of an activity. In the course of holding ORS 12.115 applicable to strict products liability actions, we noted evidentiary and policy considerations behind statutes of limitation and statutes of ultimate repose which led us to conclude that no distinction should be drawn between actions based on negligence and those based on products liability for purposes of the statute. Johnson v. Star Machinery, supra at 711. We pointed out that these factors do not call for the same result when an activity is challenged as ultrahazardous or abnormally dangerous. Plaintiff attempts to fit this case into the ultrahazardous class.

Historically, the strict liability rule of Rylands v. Fletcher, supra, is applied when an activity creates an abnormally dangerous condition, or by its nature presents extraordinary risk of harm to person or property. ³ Oregon cases have applied the rule in several contexts. See, e. g., McLane v. Northwest Natural Gas, 255 Or. 324, 467 P.2d 635 (1970) (storage of natural gas); Bedell et ux v. Goulter et al, 199 Or. 344, 261 P.2d 842 (1953) (blasting). It has no applicability in a products case.

Plaintiff, however, points to our holding in Wights v. Staff Jennings, 241 Or. 301, 405 P.2d 624 (1965), in support of his argument to the contrary. In Wights we held that strict liability was appropriate and privity of contract unnecessary when a product "creates an ultrahazardous condition." Wights v. Staff Jennings, supra at 310, 405 P.2d at 629. This is not the type of case we excepted from the bar of ORS 12.115 in Johnson, where we discussed the Rylands v. Fletcher situation. That this is so results from the analysis employed in Johnson. The policy factors cited in support of applying the statute to strict products liability actions based on § 402A would have equal force whether the product created a condition which was or was not ultrahazardous at the time of...