First Nat. Bank in Albuquerque v. Nor-Am Agr. Products, Inc., R-AM

Docket NºNOR-AM
Citation1975 NMCA 52, 537 P.2d 682, 88 N.M. 74
Case DateApril 30, 1975
CourtCourt of Appeals of New Mexico

Page 682

537 P.2d 682
88 N.M. 74
behalf of Dorothy Jean Huckleby, Charles Amos Huckleby,
Ernestine Huckleby and Michael Huckleby, minors, Lois
Huckleby, and Ernest Huckleby, Plaintiffs-Appellants,
New Mexico Mill & Elevator Co., a corporation, and Ray
Pritchett, each Individually and d/b/a Golden West
Seed Co., Defendants-Appellants,
International, Inc., a corporation, and Morton
Salt Co., a corporation, Defendants-Appellees.
No. 1375.
Court of Appeals of New Mexico.
April 30, 1975.
Certiorari Denied May 28, 1975.

Page 686

[88 N.M. 78] Richard E. Ransom, William G. Gilstrap, Smith, Ransom & Gilstrap, Albuquerque, Albert J. Rivera, Alamogordo, for plaintiffs-appellants.

William K. Stratvert, Keleher & McLeod, Albuquerque, Garrett & Hartley, Clovis, for defendants-appellants.

Jackson G. Akin, Bruce D. Hall, Rodey, Dickason, Sloan, Akin & Robb, P.A., Albuquerque, for defendants-appellees.


SUTIN, Judge.

This is an appeal from summary judgment granted in favor of defendants Morton International, Inc. and Nor-Am Agricultural Products, Inc. on plaintiffs' complaint and on the cross-claim of the co-defendant New Mexico Mill & Elevator Co., d/b/a Golden West Seed Co.

We reverse.

A. Parties

Morton International and Morton Salt Co. are the same entity. Nor-Am is a subsidiary of Morton International and is the national distributor of 'Panogen--15', the product manufactured by Morton. These three defendants will be referred to as 'Morton'.

New Mexico Mill & Elevator Co., d/b/a Golden West Seed Co., is the grain company which received Panogen--15 from Morton. Golden West used Panogen--15 in treating grain for seed purposes. It will be referred to as 'Golden West'.

Ernest and Lois Huckleby are the father and mother of Dorothy Jean, Charles Amos, Ernestine and Michael Huckleby. They will be referred to as 'Huckleby'.

Both Huckleby and Golden West now appeal the summary jdugment in favor of Morton.

On this appeal, Golden West has adopted all issues and theories raised by Huckleby, as well as all of Huckleby's arguments in support.

B. Huckleby's Theories for Recovery

Huckleby's complaint sets forth five theories for recovery. With regard to three of those theories, we agree with the trial court that there is no genuine issue as to any material fact, and that Morton, therefore, is entitled to judgment as a matter of law.

The first theory on which we affirm is: The labelling on Morton's product, and the warnings contained therein, violated the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C.A. § 135 et seq. (1964), as amended, (1975 Supp.); and that such violation constituted negligence per se.

We find nothing in the record to suggest violation of the federal statute. On the contrary, the record contains evidence that the labelling information in question had been registered with and approved by the Department of Agriculture, in compliance with the statute.

The second theory on which we affirm is: Morton was negligent in the formulation, testing and investigation of its product.

The product in question is Panogen--15. Huckleby does not contend that Morton negligently manufactured Panogen--15. Huckleby contends that Morton should not have manufactured it at all. In reality, this is a nuisance theory, and not a theory of negligence in manufacture. This theory fails for two reasons. First, Panogen--15 was manufactured pursuant to authority granted by the federal government. Therefore, its manufacture does not constitute a nuisance, as a matter of law. Section 40A--8--1, N.M.S.A.1953 (2d Repl.Vol. [88 N.M. 79]

Page 687

6). Second, our Supreme Court has expressed its unwillingness to allow a personal injury claim to go to trial on a nuisance theory. Jellison v. Gleason, 77 N.M. 445, 423 P.2d 876 (1967).

The third theory on which we affirm is: Morton is absolutely liable for injuries caused by the marketing of an ultrahazardous product.

New Mexico has adopted the rule of absolute liability for ultrahazardous activities given by Restatement, Torts §§ 519, 520, (1938) at 41--47. Thigpen v. Skousen & Hise, 64 N.M. 290, 327 P.2d 802 (1958). Huckleby contends that Panogen grain treatment is an ultrahazardous activity, as defined in the Restatement rule. We disagree. That rule defines an ultrahazardous activity as one (a) that is not a matter of common usage; and (b) in which the danger cannot be eliminated by the exercise of utmost care. Restatement, Torts § 520. The record shows that neither or those conditions are met in the instant case. First, Panogen grain treatment had wide acceptance and use throughout the county at the time of the Huckleby incident. Second, the arguments of all parties recognize that adequate warning would eliminate the danger.

We reverse, and hold that Huckleby and Golden West can go to trial on their complaint and cross-claim on the following two theories for recovery:

(1) Negligence as to the warning, provided by the seller, of dangers associated with use of the seller's product;

(2) Special liability of the seller of a product for physical harm to a user or consumer, pursuant to Restatement, Torts, 2d § 402A, v. 2 (1965), at 347--348.

Golden West may proceed against Morton only on its claim for contribution. See this opinion, infra.

C. Facts

In the summer of 1969, Ernest Huckleby and a number of his friends in Alamogordo, New Mexico, were raising hogs as a sideline. On August 16, 1969, Huckleby and three friends went to Golden West to buy some grain to feed their hogs. They all bought grain, and in the course of so doing, one friend asked an employee of the company if they could get some of the older, worse-looking grain, that was standing around in sacks towards the rear of the area, for a cheaper price. The employee allowed them to take that grain free of charge.

It appears that mixed in with that poor quality feed grain was grain that had been treated with Panogen--15. Panogen--15 is a liquid treatment for grain that is to be used as seed. The treatment prevents fungus and other seed diseases.

Morton knew the method of processing grain into seed suitable for planting. It knew that 'the first step in the treatment of (grain) for planting is the separation of good (grain) from chaff, sticks, dirt, weed seeds, broken seeds, shrivelled seeds and other materials not suited for planting * * *. After cleaning, the good (grain) is routed to the (grain) treater where the Panogen--15 treatment is applied; the treated (grain) is then bagged. In the course of treating and bagging good (grain) a residue of (grain) may collect underneath the treater or in the bagging area. This treated residue is commonly called 'sweepings'.'

During the period of the events that gave rise to this case, Panogen-treated grain was widely used for planting throughout the country. Morton sold about 174,000 gallons of liquid Panogen--15 each year. Panogen--15 contains mercury, which makes it very highly toxic. Eight parts of Panogen-treated grain per million parts of untreated grain, by weight, is a lethal dose. Following the Huckleby incident, the government suspended Morton's license to market Panogen--15.

Huckleby fed his hogs from the grain that had been obtained from Golden West, mixing the grain with garbage. He fattened a boar hog on this diet for seven [88 N.M. 80]

Page 688

weeks. On October 4, 1969, he slaughtered the boar hog. For the next two or three months, the family ate meat and internal organs from the slaughtered hog with regularity. In late October, Huckleby's hogs that had been fed from the treated grain became ill. On December 4th, Ernestine became ill; in late December, Charles Amos became ill; and in January, 1970, Dorothy Jean became ill. On March 22, 1970, Mrs. Huckleby gave birth to Michael, who was born with congenital defects.

Medical authorities determined that the chldren had been stricken by organic mercury poisoning, attributable to their eating meat from the boar hog that had been fed on Panogen-treated grain. As the result, the children all suffered permanent blindness, paralysis and other effects resulting from injuries to the central nervous system.

The only warning information given to Golden West by Morton were labels and tags relative to Panogen--15. Copies of the label and tag are appended to this opinion.

Extensive investigation by experts from the Federal Communicable Disease Center, in Atlanta, Georgia, established the following facts:

Organic mercury poisoning selectively strikes children, which explains why the adult members of the Huckleby family were not stricken. The poisoning of the Huckleby children resulted from a chain or secondary poisoning effect of the Panogen--15. That is, the boar hog which fed on Panogen-treated grain did not, itself, show signs of mercury poisoning at the time it was slaughtered. However, the mercury tht the hog had taken in from the treated grain caused organic mercury poisoning in the children who ate meat and internal organs from that hog.

D. Morton's Admissions

For purposes of its motion for summary judgment, Morton admits:

(1) The injuries to the Huckleby children;

(2) That the injuries were caused by mercury poisoning traced to the Panogen-treated grain.

(3) That only the Panogen tag and label should be considered to determine what warning information was communicated by Morton to Golden West.

(4) No warning information of any kind was communicated to Ernest Huckleby. He did not receive any tags or labels with the grain he acquired from Golden West. Nor was he otherwise warned of dangers associated with treated grain.

(5) Morton knew about the chain poisoning effect that caused the Huckleby children's injuries.

(6) Misuse of Panogen-treated grain for animal feed was foreseeable by Morton.

(7) Morton had a duty to warn of dangers from any foreseeable misuse of...

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