Estate of Pearson v. INTERSTATE POWER
Citation | 700 N.W.2d 333 |
Decision Date | 15 July 2005 |
Docket Number | No. 03-1668.,03-1668. |
Parties | The ESTATE OF Robert W. PEARSON, by its Co-Administrators, Rebecca LATTA, Neal W. Pearson and Penny D. Swanson, and the Estate of Mary E. Pearson, by its Co-Administrators Rebecca Latta, Neal W. Pearson and Penny D. Swanson, Appellees, v. INTERSTATE POWER AND LIGHT COMPANY, f/k/a IES Utilities, Inc., an Iowa Corporation, Appellant. |
Court | United States State Supreme Court of Iowa |
Stephen J. Holtman and Leonard T. Strand of Simmons, Perrine, Albright & Ellwood, P.L.C., Cedar Rapids, for appellant.
A. John Arenz and Stephen C. Krumpe of O'Connor & Thomas, P.C., Dubuque, and Timothy J. Aiken of Aiken & Scoptur, S.C., Milwaukee, Wisconsin, for appellees.
David R. Schlee and Truman K. Eldridge, Jr., of Schlee, Huber, McMullen & Krause, P.C., Kansas City, Missouri, and Stephen J. Powell and Jim D. DeKoster of Swisher & Cohrt, P.L.C., Waterloo, for amicus curiae American Gas Association.
A jury returned a verdict against a natural gas utility on two wrongful death claims arising from a natural gas explosion. On appeal the utility claims it did not have a common-law duty to warn its customers of the dangers inherent with using its gas, and if it did, the filed-tariff doctrine shields it from liability. The utility also asserts the damages awarded by the jury for loss of parental consortium and for physical and mental pain and suffering are excessive. Finally, the utility argues the district court erred in entering judgment against it for eighty-five percent of the damages. Because we hold (1) the utility owed a common-law duty to warn its customers of the dangers inherent with using its gas; (2) the filed-tariff doctrine did not shield it from liability; and (3) the damages awarded for loss of parental consortium and for physical and mental pain and suffering were not excessive, we affirm the district court in part. We, however, reverse the district court for entering judgment against the utility for eighty-five percent of the damages and remand the case to the district court to enter judgment consistent with this opinion.
In the early morning hours of October 29, 1998, Robert and Mary Pearson, a married couple in their sixties, were in bed sleeping when an explosion and resulting fire occurred in their home. Mary died at the scene, and Robert, who had managed to escape the burning house but suffered severe burns to most of his body, died at the hospital approximately seventeen hours after the explosion. The explosion and resulting fire destroyed Robert and Mary's home and the personal property located on the premises.
It is undisputed the explosion had been caused by a faulty piece of brass tubing, known as a cobra connector, connecting the natural gas line to a stove in the basement of the Pearson house. The manufacturer of cobra connectors discontinued production of these connectors in the seventies and has since closed its business.
IES, a seller of electricity and natural gas, provided the natural gas to the Pearson home. The estates' experts testified natural gas as found in the ground contains sulfur compounds. Prior to being put in the pipeline for transportation to Iowa, the gas company, which mines the gas, utilizes a process known as scrubbing to remove the sulfur compounds. However, this scrubbing process does not remove all of the sulfur compounds. Once the gas reaches IES's gate station, IES adds an odorant to the gas known as ethyl mercaptan, a sulfur compound. IES adds the odorant to the gas to alert customers of a gas leak because natural gas is odorless.
Experts from both sides agree sulfur compounds can be corrosive. An expert for the estates testified the synergistic effect of sulfur in the gas and sulfur in the ethyl mercaptan causes a chemical reaction to occur in the phosphorous brazing alloy of the cobra connector. "Synergistic," as used by the expert, means one without the other; they have to work in combination with each other to create the reaction. This chemical reaction causes the brazed joint to corrode and deteriorate. The resulting corrosion and deterioration led to a catastrophic failure of the connector in the Pearson residence and allowed gas to accumulate in the basement. The water heater's pilot light ignited the accumulation of gas causing the explosion and fire.
To support the estates' expert opinions that the sulfur compounds in the gas caused a catastrophic failure of the cobra connector, the estates had the Pearsons' connector examined by an expert in material and metallurgical engineering. The expert examined the connector with a scanning electron microscope and confirmed the connector contained sulfidation corrosion.
IES's experts disagreed with the estates' experts. They testified the gas companies scrub the corrosive sulfur compounds out of the gas before it enters the pipeline. They also testified although ethyl mercaptan is a sulfur-based compound, it is non-corrosive. They opined the catastrophic failure of the cobra connector had nothing to do with the ethyl mercaptan it added to the natural gas supplied to the Pearson residence, but rather, the design of the connector caused the connector to fail.
IES was aware of the failures attributable to the cobra connectors prior to the explosion at the Pearson home. Apparently, there had been at least two other fatal explosions resulting from failures of cobra connectors in IES's service area prior to the Pearson house explosion. Additionally, IES had received notices from the American Gas Association (AGA) and the Consumer Product Safety Commission as early as 1979. There was testimony at trial that although IES managers issued memorandums to IES employees regarding the dangers of the cobra connectors and the necessity of their identification and removal, IES employees were not trained or required to recognize and remove the cobra connectors from the field when the employees were in the customers' homes. Although IES argues there was no law requiring IES to take action with regard to the connectors located inside its customers' homes, IES voluntarily used public service announcements and warning bulletins stuffed in its bills to warn customers of the dangers of the cobra connectors. The estates' experts opined IES's attempt to warn its customers regarding the dangers of the cobra connectors was inadequate and below the standard of care.
The Pearson's three adult children, Rebecca Latta, Penny Swanson, and Neal Pearson, as co-administrators of their parents' estates, filed this action against IES. The petition, as amended, alleged when IES supplied its natural gas to the house, it knew or should have known its gas posed a risk to its customers when the sulfur compounds contained in the gas came into contact with a cobra connector.
IES moved for summary judgment on several bases. IES first noted it did not design, manufacture, sell, install, or maintain the cobra connector. IES argued it could not be liable for injuries or damages for its failure to warn of the dangers associated with cobra connectors. IES also argued the filed-tariff doctrine shielded it from liability for any injury, loss, or damage resulting from the use of the customer's piping or other equipment. Finally, IES claimed it did not assume a duty to its customers when it made inspections or recommendations solely as a courtesy.
The district court overruled the motion. The case proceeded to trial. At the conclusion of the estates' evidence and again at the close of all the evidence, IES moved for directed verdict on the grounds it raised in its motion for summary judgment. The district court denied the motions. Ultimately, the district court submitted three specifications of negligence for the jury's consideration. They were:
The district court submitted the case to the jury using a special verdict form requiring the jury to determine whether IES was negligent on each specification. The jury found IES negligent under specifications one and three but found IES was not negligent under specification two. The jury also found IES seventy percent at fault and Robert and Mary each fifteen percent at fault. The jury awarded damages, before a reduction for fault, as follows:
Robert's Estate Pre-death pain and suffering $ 1,500,000.00 Present worth of the value of the estate $ 55,000.00 Rebecca's loss of parental consortium $ 505,000.00 Penny's loss of parental consortium $ 505,000.00 Neal's loss of parental consortium $ 510,000.00 Burial expense $ 8,000.93 Pre-death medical expenses $ 6,219.31 One-half value of homestead $ 37,500.00 One-half value of vehicles $ 13,500.00 One-half value of personal property $ 13,172.00 One-half cost of demolition $ 970.00 Total $ 3,154,362.24 Mary's Estate Pre-death pain and suffering $ 250,000.00 Present worth of the value of the estate $ 55,000.00 Rebecca's loss of parental consortium $ 510,000.00 Penny's loss of parental consortium $ 510,000.00 Neal's loss of parental consortium $ 540,000.00 Burial expense $ 5,691.75 One-half value of homestead $ 37,500.00 One-half value of vehicles $ 13,500.00 One-half value of personal property $ 13,172.00 One-half cost of demolition $ 970.00 Total $ 1,935,833.75
Based on the verdict, the district court entered judgment in favor of Robert's estate in the sum of $2,681,207.90 and Mary's estate in the sum of $1,645,458.69. The judgments represented a fifteen-percent reduction for each estate's fault.
IES filed post-trial motions requesting a new trial, remittitur, or a judgment notwithstanding the verdict. It also filed a ...
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