Groppel Co., Inc. v. U.S. Gypsum Co., s. 41452
| Decision Date | 27 January 1981 |
| Docket Number | Nos. 41452,41453,s. 41452 |
| Parties | 32 UCC Rep.Serv. 35 GROPPEL COMPANY, INC., Appellant-Respondent (Plaintiff), v. UNITED STATES GYPSUM COMPANY, Appellant-Respondent (Defendant), and Underwriters' Laboratories, Inc., Respondent (Defendant). |
| Court | Missouri Court of Appeals |
Leritz & Reinert, P.C., Bernard A. Reinert, James F. Hespen, P.C, St. Louis, for Groppel Co., Inc., appellant-respondent (plaintiff).
Willson, Cunningham & McClellan, James S. McClellan, George C. Willson, III, St. Louis, for appellant-respondent, United States Gypsum Co.
Armstrong, Teasdale, Kramer & Vaughan, John J. Cole, St. Louis, for appellee (defendant), Underwriters' Laboratories, Inc.
Plaintiff, Groppel Company, Inc. (Groppel) filed a multiple count suit against defendants United States Gypsum Company (U.S Gypsum) and Underwriters' Laboratories, Inc. (sometimes U.L.) seeking damages arising out of the manufacture, sale and representation of an alleged defective product. Jury verdict was in favor of Groppel and against U.S. Gypsum for $268,711 actual and $860,133 punitive damages. The trial court granted summary judgment in favor of defendant Underwriters' Laboratories and on two counts of the amended petition in favor of U.S. Gypsum. Groppel has appealed from the adverse results of the summary judgment. U.S. Gypsum has appealed the adverse jury verdict. We affirm the award of actual damages with remittitur and reverse as to the punitive damages. We affirm the granting of the summary judgments, including the judgment in favor of Underwriters' Laboratories.
This litigation arose out of the construction of the Mercantile Center, a thirty-five story building in St. Louis. Groppel was the subcontractor responsible for applying fireproofing materials to the steel structure of the building. Its contract required it to spray-apply a fireproofing material to the steel structure for the purpose of minimizing and delaying heat conduction to the steel in the event of a fire. The fireproofing material was to be applied with a specific thickness that would provide a particular heat delay time rating as published in an Underwriters' Laboratories' bulletin entitled "Fire Resistance Index" an authoritative source relied on by the construction industry concerning fire retardant ratings of materials. The application of the material was also to comport with the St. Louis City building Code.
One of the materials designated in the Fire Resistance Index was "SprayDon Standard J", a product of the Sprayon Research Corporation (Sprayon Research). SprayDon Standard J was an asbestos-free product formulated and developed by Sprayon Research and was manufactured by U.S. Gypsum according to the formula supplied by Sprayon Research. After extensive testing by Underwriters' Laboratories at the behest of Sprayon Research, the conclusion was reached that SprayDon J would be a suitable and approved fireproofing material yielding a proper fire protection rating provided that when it was applied it would maintain a minimum density of 11 pounds per cubic foot (pcf), although tests showed that SprayDon J tended to fail to fulfill the 11 pcf requirement. And, as later developed, this is where the rub came in.
As the SprayDon J was manufactured by U.S. Gypsum, personnel from Underwriters' Laboratories would make periodic inspections of quality control measures of the product. A favorable inspection permitted U.S. Gypsum to affix the Underwriters' Laboratories' seal to the package of material verifying that it had been classified by Underwriters' Laboratories as approved for use as fireproofing on certain design types. The label, however, did not refer to the density of the product. On the basis of the Underwriters' Laboratories Fire Resistance Index listing SprayDon J as manufactured by U.S. Gypsum as a suitable fireproofing material together with certain information in another construction industry catalog 1, Groppel determined that the product would be satisfactory for the Mercantile project. Circumspect of the financial well being of Sprayon Research Corporation as a supplier of SprayDon J, Groppel received the assurance of U.S. Gypsum that it would continue with the supply of the product in the event of failure of Sprayon Research.
Groppel was awarded the fireproofing contract and issued its purchase order to Sprayon Research for 300 tons of SprayDon J at a cost of $52,850. Richard Kempthorne, president of Sprayon Research, outlined recommended procedures for an efficient fireproofing application, including advice that a testing laboratory periodically check the material for density and thickness of application.
In seeking approval of fireproofing plans from the general contractor, the architect and the City of St. Louis, Groppel advised the City's building commissioner that it would test the fireproofing for density and thickness after spraying each floor.
After being awarded the fireproofing contract Groppel employees applied the SprayDon J, consisting primarily of rock wool, Portland cement and adhering agents in a slurry mixture, by spraying it directly on the steel structure and under the initial supervision of Mr. Kempthorne. Thickness of the application was measured periodically by the simple technique of sticking a nail into the applied material. No density tests were undertaken until about 10 floors had been substantially sprayed, as other construction work was under way. When Groppel did engage a testing laboratory to spot check for density, test results showed a wide variance in density from floor to floor, with only two of the ten floors testing below the 11 pcf density requirement. But tests of a second testing laboratory employed and approved by the owner of the building revealed serious and wide spread density deficiencies in the fireproofing application. To a lesser extent thickness deficiencies also appeared this after Groppel's work approached 92% of completion. Groppel met with the owner, architect, Sprayon Research Corporation and Underwriters' Laboratories U.S. Gypsum was not present or represented to discuss solutions to the contretemps existing. The conclusion was reached that the lack of density could be overcome by having Groppel overspray the existing fireproofing to an extra thickness to compensate for a lack of product density. Groppel's workmen oversprayed the project and approval was given to the work. But the extra work was extremely costly to the extent that after borrowing funds to complete the project, Groppel was forced to go out of business to pay for the loss.
Suit was then filed by Groppel against U.S. Gypsum and Underwriters' Laboratories to recover its loss and for punitive damages. 2
The jury awarded Groppel actual damages of $268,711 for the cost of overspraying, including approximately $31,000 for lost profits and overhead expenses, approximately $44,000 in interest on funds borrowed to complete the work and about $34,000 from loss due to the forced sale of equipment and inventory.
U.S. Gypsum alleges a multitude of trial court errors, many of them interrelated. It presents four separate reasons why the trial court should have granted its motions for directed verdict: (1) that Groppel did not present a submissible case upon the evidence, in that the evidence did not support the allegations that U.S. Gypsum knew or should have known that the fireproofing material did not meet the density requirements for the Mercantile project, that it could not be manufactured as formulated to meet such requirements, that it failed to warn of these facts; (2) that a submissible case was not presented under applicable law, in that the product alleged to have been unfit was not purchased from U.S. Gypsum, was not a dangerous product, and did not inflict physical harm on Groppel or its property; (3) Groppel was contributorily negligent as a matter of law because it did not make density tests as the work progressed; and (4) the punitive damages claim should not have been submitted to the jury because the evidence did not show "willful and intentional wrongdoing".
Also, U.S. Gypsum contends that the trial court should have granted summary judgment against Groppel for its failure to state a cause of action as urged in point (2) above. Furthermore, it asserts four separate reasons why its motion for new trial should have been granted: (1) the giving of a modified MAI 25.06 verdict directing instruction was improper; (2) an improper damages instruction, MAI 4.01, was given; (3) the verdict was excessive and remittitur should have been ordered; and (4) incompetent and irrelevant evidence was admitted over its objection.
We first consider U.S. Gypsum's argument that the summary judgment should have been granted against Groppel on Count III, the negligence cause of action. 3 The relevant portions of Count III allege that U.S. Gypsum "knew or should have known that the 'SprayDon Type J' material was required to be of a certain minimum density, i. e., 11 pounds per cubic foot, on being spray-applied to meet the project specifications" and that it "negligently furnished" the material "to plaintiff (Groppel) in that it failed to meet the specified minimum density of eleven (11) pounds per cubic foot on being spray-applied." Summary judgment is authorized only where the pleadings, depositions, admissions on file together with any affidavits reveal that there is no genuine issue of material fact and that a party is entitled to a judgment as a matter of law. Rule 74.04(c) Mo.R.Civ.P. The party moving for summary judgment must demonstrate by unassailable proof that there is no genuine issue of fact; a genuine issue of fact exists whenever there is the slightest doubt about the facts. Cooper v. Yellow Freight System, Inc., 589 S.W.2d...
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