Florida Specialty, Inc. v. H 2 Ology, Inc.

• Decision Date: 20 October 1999
• Docket Number: No. 98-309.,98-309.
• Citation: 742 So.2d 523
• Parties: FLORIDA SPECIALTY, INC., a Florida corporation, and Nimnicht Cadillac Company, Inc., a Florida corporation, Appellants, v. H 2 OLOGY, INC., a Florida corporation, and Stephen P. Brandvold, Appellees.
• Court: Florida District Court of Appeals

742 So.2d 523

FLORIDA SPECIALTY, INC., a Florida corporation, and Nimnicht Cadillac Company, Inc., a Florida corporation, Appellants, v. H 2 OLOGY, INC., a Florida corporation, and Stephen P. Brandvold, Appellees.

No. 98-309.

District Court of Appeal of Florida, First District.

October 20, 1999.

Carl D. Dawson of Dawson, Galant & Sulik, Jacksonville, for Appellants.

T. Geoffrey Heekin, Ann Krueger Smith, and S. Hunter Malin, Jacksonville, for Appellees.

KAHN, J.

Appellants, Florida Specialty, Inc. and Nimnicht Cadillac Company, Inc., were plaintiffs below in this negligence action brought against appellees, H 2 Ology, Inc. and Stephen P. Brandvold. Appellants challenge an order dismissing their Third Amended Complaint with prejudice. Because the complaint states a cause of action against both appellees, and Nimnicht's claim is not barred by the economic loss rule, we reverse. We recite the facts as set out in the complaint.

At various times, Florida Specialty leased three Cadillac cars from Nimnicht. Florida Specialty is a Jacksonville company located at 8295-4 Western Way Circle. Florida Specialty employees operated the leased vehicles on Western Way Circle. H 2 Ology operates a business at 8286-01 Western Way Circle. Brandvold is the "sole stockholder, sole officer and sole employee" of H 2 Ology.

H 2 Ology and Brandvold manufactured a product called Brine Plus, an extremely corrosive saltwater solution. In the words of the complaint, Brine Plus "poses a foreseeable threat of corrosion to motor vehicles which might come in contact with it." Appellees utilized Western Way Circle to transmit overflow and spillage of Brine Plus from H 2 Ology's place of business. Also, according to the complaint, appellees knew, or should have known, that Brine Plus would harm motor vehicles lawfully using Western Way and knew, or should have known, that employees of Florida Specialty would be driving their automobiles on Western Way Circle in order to get to and from work. Nevertheless, H 2 Ology and Brandvold negligently caused Brine Plus solution "to flow onto the public street of Western Way Circle and negligently failed to warn officers and employees of Florida Specialty, Inc. of the damage that would be caused to their respective vehicles if they drove through or into the Brine Plus solution." Florida Specialty employees drove the leased vehicles through the Brine Plus solution resulting in extensive damage and depreciation to the motor vehicles.

H 2 Ology and Brandvold jointly moved to dismiss the Third Amended Complaint with prejudice. After a hearing, the trial court granted the motion to dismiss with prejudice as to Nimnicht and without prejudice as to Florida Specialty. When Florida Specialty declined to replead, the court entered an order of dismissal with prejudice disposing of the entire complaint. Although the motion raised numerous grounds for dismissal, neither order elaborates upon the trial court's rationale for dismissing the complaint. This appeal ensues.

On a motion to dismiss, the trial court is bound to accept all well-pleaded facts as true. See, e.g., Brewer v. Clerk of the Circuit Court of Gadsden County, 720 So.2d 602 (Fla. 1st DCA 1998); Martin Elec., Inc. v. Glombowski, 705 So.2d 26, 28 (Fla. 1st DCA 1997). Here, the complaint alleges that appellants and appellees are neighbors on the same roadway in Jacksonville. The complaint also alleges that appellees had actual or constructive knowledge that their discharge of Brine Plus onto Western Way Circle would harm motor vehicles and that appellees knew that Florida Specialty employees drove their cars on Western Way Circle to get to and from work. The complaint thus alleges the existence of a duty by setting forth allegations that appellees' actions created "a foreseeable zone of risk." Pate v. Threlkel, 661 So.2d 278, 280 (Fla.1995). A legal duty will arise "whenever a human endeavor creates a generalized and foreseeable risk of harming others." McCain v. Florida Power Corp., 593 So.2d 500, 503 (Fla.1992).

A landowner abutting a public highway may have a duty toward passing motorists for creation of a dangerous artificial condition on the highway. See Whittaker v. Honegger, 284 Ill.App.3d 739, 221 Ill.Dec. 169, 674 N.E.2d 1274, 1276 (1996) (holding that landowners owed passing motorcyclists a duty to exercise ordinary care to prevent or remedy allegedly dangerous condition presented by gravel that had migrated onto paved highway from landowner's driveway); Harris v. F.W. Woolworth, 824 S.W.2d 31, 33 (Mo.Ct.App.1991) ("A person who creates a dangerous condition on a public roadway is liable for the foreseeable injuries caused thereby."). In this case, as noted above, appellants have made specific allegations concerning appellees' knowledge that their dangerous products had migrated onto the highway and, once on the highway, posed a hazard to passing motor vehicles. The complaint sufficiently alleges duty.

We also conclude that the complaint sufficiently alleges damages. Nimnicht is the lessor, and Florida Specialty the lessee, of the three Cadillac vehicles allegedly damaged by the corrosive solution. Although appellees argue that appellants have failed to allege payment of money as a result of the damage, they cite no cases indicating that such payment is a prerequisite to an adequate allegation of damages in a negligence case. The proper measure of property damages is generally said to be the diminution in value as a result of the negligence or the reasonable cost of repair. See Davey Compressor Co. v. City of Delray Beach, 639 So.2d 595 (Fla.1994).

Appellees apparently convinced the trial court that Nimnicht, as lessor of the automobiles, has no remedy. The trial court erred to the extent that it accepted this argument. Either a bailor or a bailee of personal property may maintain an action against a third party to recover damages for injury to, or destruction of, the bailed object, and the amount paid or recovered is deemed held in trust to be applied according to the respective rights of the parties. See Lake City Auto Fin. Co. v. Waldron, 83 So.2d 877 (Fla.1955). A lessor is a bailor for hire. See, e.g., W.E. Johnson Equip. Co. v. United Airlines, Inc., 238 So.2d 98 (Fla.1970).

The trial court also erred by adopting appellees' argument concerning the economic loss rule. Appellees argue that because Florida Specialties is responsible, under the Nimnicht lease, for damage to the cars, the economic loss rule bars a tort action for any such damage. The economic loss rule is a derivative of contract law. See Comptech Int'l, Inc. v. Milam Commerce Park Ltd., 711 So.2d 1255, 1257 (Fla. 3d DCA 1998)(noting that the economic loss rule does not permit a cause of action for economic damages "where the claims are clearly contractual in nature and the cause of action is inseparably connected to the breaching party's performance under the contract"). No cases cited by appellees suggest that the rule applies to bar a tort claim whenever the claimant has any contractual remedy against any other party.

Contrary to appellees' assertions, neither Florida Building Inspection Services, Inc. v. Arnold Corp., 660 So.2d 730 (Fla. 3d DCA 1995), nor American Universal Insurance Group v. General Motors Corp., 578 So.2d 451 (Fla. 1st DCA 1991), has any application to this case. Appellees rely upon these cases because in each opinion the court notes a lack of privity...