Hedges v. Public Service Co. of Indiana, Inc.

• Decision Date: 27 November 1979
• Docket Number: No. 1-479A122,1-479A122
• Citation: 396 N.E.2d 933
• Parties: 27 UCC Rep.Serv. 945 John HEDGES and Harold Hedges, Plaintiffs-Appellants, v. PUBLIC SERVICE COMPANY OF INDIANA, INC., Defendant-Appellee.
• Court: Indiana Appellate Court

Page 933

396 N.E.2d 933

27 UCC Rep.Serv. 945

John HEDGES and Harold Hedges, Plaintiffs-Appellants, v. PUBLIC SERVICE COMPANY OF INDIANA, INC., Defendant-Appellee.

No. 1-479A122.

Court of Appeals of Indiana, First District.

Nov. 27, 1979.

Robert G. Burton, Richmond, for plaintiffs-appellants.

Duegean C. Garrett and Gregory A. Troxell, Plainfield, for defendant-appellee.

LOWDERMILK, Presiding Judge.

STATEMENT OF THE CASE

Plaintiffs-appellants John and Harold Hedges appeal a judgment in favor of the defendant Public Service Company of Indiana, Inc. (PSI) denying their claim for damages for injuries suffered as a result of their coming into contact with PSI's high-voltage transmission wires.

FACTS

In 1969 John Hedges purchased a farm in Wayne County, Indiana. At the time of purchase the farm was in poor condition, but over the course of five years the industrious Hedges made substantial improvements: a fishing pond, horse barn, outdoor arena, etc. Rodeos and 4-H activities were held on the property at various times.

In 1974, when John was arranging the construction of the barn, he contacted PSI to request an extension of his electrical service to the proposed facilities. A PSI employee came to John's farm to gather information regarding the proposed installation. There was evidence to show that John considered the possibility of putting the service underground, for reasons of safety or aesthetics, but due either to John's unwillingness to incur the costs or PSI's refusal to install the service in that manner, high voltage wires were run on standard utility poles from the road to the barn.

On June 25, 1975, John and Harold Hedges (who worked for John, his nephew) were preparing for a rodeo which was to be held the following day. They were removing lights from temporary poles in the parking area (near the completed horse barn) to use the fixtures to illuminate a nearby pasture which was to be used for parking space. At one point in the operation, John removed one of the lights and descended from the ladder. John and Harold then grabbed the ladder, one on each side, and began carrying it in a vertical position to another location. The aluminum ladder came into contact with the uninsulated, 7200-volt power line. Both men were seriously injured.

The height of the wire above the ground at the point where the contact occurred was twenty feet, ten inches. There was conflicting evidence as to whether the sixteen-foot extension ladder was fully, partially, or only slightly extended when the men attempted to move it across the lot.

John and Harold filed their claim in the Wayne Circuit Court. Their complaint for compensatory and punitive damages was based upon negligence, breach of implied warranties, and strict liability. PSI was granted a summary judgment on the issues of implied warranty and strict liability. The case was tried to a jury on the issue of negligence, and the jury found for PSI.

ISSUES

1. Whether the trial court erred in granting PSI's motion for summary judgment on the issues of breach of implied warranties and strict liability.

2. Whether the trial court erred in refusing the Hedges' proffered jury instructions numbered 2 and 4.

3. Whether the trial court erred in giving its own instructions numbered 6 and 7.

4. Whether the trial court erred in admitting evidence of John's prior marriages.

Issue One

The Hedges presented their strict liability claim as follows:

"6. Defendant distributed and placed into commerce and service said power lines and electrical service which were unreasonably dangerous to the ultimate user or consumer thereof, being plaintiffs, and as a result thereof, plaintiffs were injured. Defendant is strictly liable to plaintiffs."

The doctrine of strict liability as set forth in Restatement (Second) of Torts § 402A (1964) was adopted by this court in Cornette v. Searjeant Metal Products, Inc., (1970) 147 Ind.App. 46, 258 N.E.2d 652. ¹ See, Ayr-Way Stores, Inc. v. Chitwood, (1973) 261 Ind. 86, 300 N.E.2d 335; Perfection Paint & Color Company v. Konduris, (1970) 147 Ind.App. 106, 258 N.E.2d 681. Section 402A as adopted at page 50 of 147 Ind.App., at page 655 of 258 N.E.2d, provides:

"Special Liability of Seller of Product for Physical Harm to User or Consumer

(1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if

(a) the seller is engaged in the business of selling such a product, and

(b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.

(2) The rule stated in Subsection (1) applies although

(a) the seller has exercised all possible care in the preparation and sale of his product, and

(b) the user or consumer has not bought the product from or entered into any contractual relation with the seller."

In Petroski v. Northern Indiana Public Service Company, (1976) Ind.App., 354 N.E.2d 736, 747, we stated, "Electricity is a product which can be sold within the meaning of § 402A." However, we also noted that although a literal "sale" of the product is not required, the product must be placed into the stream of commerce before § 402A strict liability can attach. Link v. Sun Oil Company, (1974) 160 Ind.App. 310, 312 N.E.2d 126. In Petroski a fourteen year old boy was injured when he came into contact with an uninsulated high-voltage wire which ran through the branches of a tree in which he was climbing. We stated at page 747 of 354 N.E.2d:

"* * * Technically, until the electricity reaches its destination in a home or factory, it is transmitted by equipment over lines under the exclusive control of NIPSCO. The electric company's transmission and distribution lines are not a part of the end product which reaches the consumer as in the case of bottles and cans which are a part of the finished product. Since NIPSCO had not yet placed its product in the stream of commerce, a judgment on the evidence on the issue of strict liability is proper in the case at bar."

The distribution lines and electrical service with which John and Harold came into contact were not products in the stream of commerce as required by § 402A. PSI's distribution lines are not sold to their customers; they are owned and controlled by the company. The only "product" that was in the process of being sold was electricity. The Hedges acknowledge the fact that high-voltage electrical energy must be stepped-down by various transformers from transmission (7200) to consumption (110/220) voltage. The Hedges encountered electrical energy in an unmarketable and unmarketed state. We find that the electricity was not in the stream of commerce and therefore § 402A strict liability would not apply. See, Annot., 83 A.L.R.3d 218 (1978).

The Hedges also assert that PSI should be held liable on the grounds that PSI impliedly warranted that its power lines and electrical service were merchantable, IC 1971, 26-1-2-314 (Burns Code Ed.), and fit for a particular purpose, IC 1971, 26-1-2-315 (Burns Code Ed.). ²

In Helvey v. Wabash County REMC, (1972) 151 Ind.App. 176, 278 N.E.2d 608, we determined that electricity is a "good" under the Uniform Commercial Code as enacted in this state. The plaintiffs in Helvey based their claim for damages to household appliances upon an alleged breach of implied and express warranties in the supplying of 135-volt, instead of the standard 110-volt, electrical current. We considered this to be a defect in the purchased good, and a claim under the U.C.C. was permitted.

We have stated that the warranty provisions of Article 2 of the Uniform Commercial Code apply to Sales of Goods. Thompson Farms, Inc. v. Corno Feed Products, Division of National Oats Co., Inc., (1977) Ind.App., 366 N.E.2d 3. In Helvey we had no problem finding a sale of goods because the electrical current had passed through the meter and into the household electrical system for consumption. Consumption or use of that good caused damage to various appliances in the house. We stated at page 179 of 151 Ind. App., at page 610 of 278 N.E.2d:

"It is necessary for goods to be (1) a thing; (2) existing; and (3) movable, with (2) and (3) existing simultaneously. We are of the opinion that electricity qualifies in each respect. Helvey says it is not movable and in this respect we do not agree, if for no other reason than the monthly reminder from the electric company of how much Current has passed through the meter. Logic would indicate that Whatever can be measured in order to establish the price to be paid would be indicative of fulfilling both the existing and movable requirements of goods." (Our emphasis)

The high-voltage electricity with which the Hedges came into contact was not the good PSI was intending to sell or the Hedges were intending to buy. While the delivery of 135 volts of electricity under the circumstances in Helvey can be considered the sale of a defective good, the tragic escape of 7200 volts from the transmission wire, through the ladder, and into the bodies of these men is not a transaction in goods intended to be covered by the Uniform Commercial Code. The summary judgment with regard to this claim was proper.

Finally, the Hedges encourage us to adopt the doctrine of strict liability for abnormally dangerous activities as codified in the Restatement (Second) of Torts § 520 (1976), ³ and apply its provisions to the transmission of high-voltage electricity by power companies. ⁴

We have long recognized that electricity is a Dangerous element. Hines v. Nichols, (1921) 76 Ind.App. 445, 130 N.E. 140; City of Logansport v. Smith, (1911) 47 Ind.App. 64, 93 N.E. 883. Any company which engages in the distribution of electrical energy has a common law duty to exercise reasonable care to properly insulate its power lines in places where the general public may come into...