Farish for Farish v. Courion Industries, Inc., s. 82-1964

Citation754 F.2d 1111
Decision Date22 April 1985
Docket NumberNos. 82-1964,83-2203,s. 82-1964
Parties40 UCC Rep.Serv. 857 Dorothy M. FARISH, Guardian for Shirley F. FARISH, Appellant, v. COURION INDUSTRIES, INC. and Otis Elevator Company, Appellees. Nancy L. BLY, Administratrix of Wayne Allen Bly, deceased, Appellant, v. OTIS ELEVATOR COMPANY, a New Jersey Corporation, Appellee.
CourtUnited States Courts of Appeals. United States Court of Appeals (4th Circuit)

Thomas Wolf, Richmond, Va. (Thomas W. McCandlish, Mezzullo, McCandlish & Framme, Richmond, Va., Paul M. Peatross, Jr., Carter & Peatross, Charlottesville, Va., on brief), for appellant in 82-1964.

Stephen D. Annand, Alexandria, Va. (Cohen, Annand, Dunn & Sinclair; Charles Shepherd Cox, Jr., Alexandria, Va., on brief), for appellant in 83-2203.

Frank N. Cowan, Richmond, Va. (Deborah S. O'Toole; Cowan, Owen & Nance, Richmond, Va., on brief), for appellee in 82-1964.

Jean-Pierre Garnier, Falls Church, Va. (G. Kenneth Miller, May, Miller & Parsons, Richmond, Va., on brief), for appellee in 83-2203.


SPROUSE, Circuit Judge:

Under the law of Virginia prior to 1962 a person injured by a defective product could not maintain an action against the manufacturer for injuries caused by the defect without privity of contract. 1 The Virginia legislature abolished this privity requirement in 1962. We decide two separate appeals in Virginia diversity cases that have been consolidated for en banc consideration: Farish v. Courion, 722 F.2d 74 (4th Cir.1983) (Sprouse, Ervin, and Wyzanski, JJ.) and Bly v. Otis Elevator Company, 713 F.2d 1040 (4th Cir.1983) (Winter Phillips, and Butzner, JJ.). The principal issue in both Farish and Bly is whether the statute abolishing the privity requirement applies retroactively to an injury incurred after the enactment of the statute but caused by a product manufactured and transferred prior to the statute's enactment.

I. Farish v. Courion

Farish involves an appeal by Dorothy M. Farish, wife and guardian of her husband, Shirley F. Farish, of the district court's Rule 12(c) dismissal of her claim for damages for his injuries. Shirley Farish was an employee of the University of Virginia, and was working within the scope of his employment as a plumber when he was totally and permanently injured in a University Hospital elevator on April 6, 1981. He was removing a tool cart from a freight elevator when the lower part of the elevator door fell to the floor below. The unsupported top portion of the door then crashed downward, striking the rod arm which had held the lower door. The rod arm was propelled upward by the force of the blow and struck Farish in the head.

Courion 2 manufactured the elevator door in Missouri and sold it to the University's contractor in 1958. Dorothy Farish, as guardian, brought this action against Courion, 3 alleging negligence in the design, manufacture, testing, and inspection of the elevator door. She also alleged breach of warranty by Courion. The district court dismissed these claims because the injured party was not in privity with Courion. The panel of this court affirmed that dismissal, holding that the Virginia anti-privity statute was prospective only, and therefore did not abolish the privity requirement in actions against manufacturers for injuries caused by products manufactured and transferred prior to the enactment of the anti-privity statute.

II. Bly v. Otis Elevator Company

Bly involves an appeal by Nancy Bly, administratrix of the estate of her son, Wayne Bly. The deceased was fatally injured in September 1979 while operating a lift truck at the Avtex Fibers Plant in Virginia where he was employed. The truck was equipped in the front with a lift mechanism used to transport large canisters throughout the factory, and in the rear with a shin-high guard designed to provide protection from objects encountered while the truck was traveling in reverse. Because the large canisters impair visibility to the front, the trucks are driven in reverse around the plant, requiring operators to look over their shoulders in the direction of travel.

The particular truck Bly was driving when he sustained injury was manufactured in Ohio by Otis's predecessor, Baker Raulang Co., which sold the truck to the predecessor-in-interest of Avtex in 1944. Baker Raulang last exercised control over the truck in 1948, when it modified the truck's lift mechanism.

The parties agree that Bly was injured in September 1979 when he backed his truck without looking behind him and ran into a canister perched on the front end lift of another truck. Because that canister was raised off the floor, the shin-high guard on Bly's truck slipped underneath, and Bly was crushed between the canister and the controls of his truck.

The wrongful death action by Bly's administratrix sought relief on the basis of negligence and breach of warranty for alleged defects in the lift truck. At the conclusion of the evidence, the district court granted Otis's motion for a directed verdict on the negligence count, holding as a matter of law that Bly's contributory negligence barred recovery. 4 Accordingly, the case went to the jury solely on a theory of breach of the implied warranty of merchantability. The jury returned a verdict for Bly's mother as administratrix on that theory and awarded her $250,000 damages.

Otis appealed to this court and the original panel deciding that appeal held that the trial court erred in instructions to the jury on the manufacturer's duty to warn. That ground for reversal and remand is not involved in the instant appeal. In ruling against Otis on its contention that the action should have been barred by lack of privity, however, the Bly panel indicated that the Virginia anti-privity statute abolished the privity requirement in actions against the manufacturer even as to products manufactured before the enactment of the statute. 5 Although the trial court in Bly was instructed to try the case again, by the time it received the case on remand Farish had been decided. The trial court, basing its holding on Farish, then dismissed the case sua sponte because there was no privity between Otis and the deceased Bly. Since there was a conflict between our panel decisions in Farish and Bly on the privity issue, we granted rehearing en banc in both cases and consolidated them for this appeal. We specifically declined to rehear that portion of Farish reversed by the original panel. 6

III. The Consolidated Appeal: The Privity Issue

Farish and Bly contend that Virginia Code Sec. 8.2-318 (1965), in abolishing the requirement of privity between a person injured by a product and its manufacturer, applies retroactively to products that were defectively manufactured and transferred prior to 1962 when the predecessor to this statute was passed. Va.Code Ann. Sec. 8-654.3 (Supp.1964). Courion and Otis argue to the contrary that the 1962 statute applies only prospectively to products manufactured after 1962 even if the injuries occurred after that date.

In the last half century few substantive areas of the law have escaped disputes over the retroactive application of new principles enunciated by legislation or by judicial decisions. The field of products liability has been no exception. In many states products liability laws have evolved solely by judicial decision. In others the legislatures have reshaped these laws and in those instances the approach for determining retroactivity vel non still involves the application of the traditional rules of statutory construction to determine legislative intent. See Orland & Steving, Retroactivity in Review: The Federal and Washington Approaches, 16 Gonzaga L.Rev. 855 (1981). The change in Virginia products liability law we are considering has been effected solely by legislation. Speidel, The Virginia "Anti-Privity" Statute: Strict Products Liability Under the Uniform Commercial Code, 51 Va.L.Rev. 804 (1965). The Supreme Court of Virginia has adopted clear and unwavering rules of statutory construction for resolving issues concerning retroactivity of statutes and it is under those rules that we decide the principal issue in this case.

Legislative enactments are applied prospectively unless the legislature indicates a contrary intent or the statute relates to remedies or procedural matters. Paul v. Paul, 214 Va. 651, 203 S.E.2d 123 (1974); Gloucester Realty Corp. v. Guthrie, 182 Va. 869, 30 S.E.2d 686 (1944); Ferguson v. Ferguson, 169 Va. 77, 87, 192 S.E. 774, 777 (1937). Absent plain legislative intent, statutes will not be applied retroactively to create new duties and obligations or to disturb vested rights. Walke v. Dallas, Inc., 209 Va. 32, 161 S.E.2d 722 (1968); Phipps v. Sutherland, 201 Va. 448, 111 S.E.2d 422 (1959). Statutes in derogation of the common law are not to be extended beyond their express terms. Chesapeake & Ohio Railway v. Kinzer, 206 Va. 175, 142 S.E.2d 514 (1965); Sellers v. Bles, 198 Va. 49, 92 S.E.2d 486 (1956).

The learned trial court in Farish, during its hearing on the motion to dismiss for lack of privity, lamented that it had recently entertained a rash of questions in diversity cases on the retroactivity of statutes. It hoped for a definitive ruling from the Virginia Supreme Court providing guidance concerning statutory change of substantive rights. The Supreme Court of Virginia obliged and recently reiterated its traditional view of the manner in which to decide whether a newly enacted state statute is to be applied prospectively or retroactively. Shiflet v. Eller, 228 Va. 115, 319 S.E.2d 750 (1984); see also Sargent Electric Co. v. Woodall, 228 Va. ---, 323 S.E.2d 102 (1984). In Shiflet, Justice Compton, writing for the court, observed "that 'substantive' rights as well as 'vested' rights, are included within those interests protected...

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