Kaminski v. Western MacArthur Co.
| Decision Date | 10 December 1985 |
| Citation | 220 Cal.Rptr. 895,175 Cal.App.3d 445 |
| Court | California Court of Appeals Court of Appeals |
| Parties | , Prod.Liab.Rep. (CCH) P 10,882 Rose K. KAMINSKI et al., Plaintiffs and Respondents, v. WESTERN MacARTHUR COMPANY, Defendant and Appellant. John CRETAN, Plaintiff and Respondent, v. FIBREBOARD CORPORATION et al., Defendants and Appellants. WESTERN MacARTHUR COMPANY, Petitioner, v. The SUPERIOR COURT of Alameda County, Respondent, In re SHIPYARD AND APPLICATOR ASBESTOS CASES (KAZAN & KILBOURNE) etc., et al., Real Parties in Interest. WESTERN MacARTHUR COMPANY, Petitioner, v. The SUPERIOR COURT of Alameda County, Respondent, In re STERNS, BROWN & FINNEY, etc., et al., Real Parties in Interest. WESTERN MacARTHUR COMPANY, Petitioner, v. The SUPERIOR COURT of Alameda County, Respondent, In re RELATED ASBESTOS CASES CONSOLIDATED FOR GENERAL PRETRIAL MATTERS (KNAPP), Real Parties in Interest. A028702, A029762, A030047, A030125 and A031922. |
Eugene Brown, Jr., Mary Ellen Gambino, Hardin, Cook, Loper, Engel & Bergez, Oakland, for defendant and appellant Western MacArthur Co. in A028702.
Harry F. Wartnick, Cartwright, Sucherman & Slobodin, Inc., San Francisco, and Daniel U. Smith, Kentfield, for plaintiffs and respondents Kaminski et al.
David M. McClain, Steven Kazan, A Law Corp., Oakland, for plaintiff and respondent Cretan.
Eugene Brown, Jr., Hardin, Cook, Loper, Engel & Bergez, Oakland, for defendants and appellants Fibreboard Corp., et al.
Raymond J. Bergez, Eugene Brown, Jr. and Mary Ellen Gambino, Hardin, Cook, Loper, Engel & Bergez, Oakland, for petitioner Western MacArthur Co. in A030047.
No appearance for respondent for Superior Court of Alameda County.
David M. McClain, Steven Kazan, A Law Corp., Oakland, George W. Kilbourne, Martinez, Bryce C. Anderson, Concord, for Shipyard and Applicator Asbestos cases (Kazan & Kilbourne) etc., et al.
Bruce E. Loper, Mary Ellen Gambino, Raymond J. Bergez and Eugene Brown, Jr., Hardin, Cook, Loper, Engel & Bergez, Oakland, for petitioner Western MacArthur Co. in A030125.
Madelyn J. Chaber, Brown & Finney, Sterns, Smith & Walker, San Francisco, and Bryce C. Anderson, Concord, for Sterns, Brown & Finney, etc., et al.
Raymond J. Bergez, Eugene Brown, Jr., Mary Ellen Gambino, Hardin, Cook, Loper, Engel & Bergez, Oakland, for petitioner Western MacArthur Co. in A031922.
Kenneth L. Knapp, Newport Beach, for Related Asbestos Cases consolidated for General Pretrial Matters (Knapp).
In these consolidated cases, we hold that Western MacArthur Company, a Bay Area distributor of Johns-Manville asbestos products, is the corporate successor of the now-defunct Western Asbestos Company for purposes of product liability for personal injuries arising from asbestos exposure. In Kaminski v. Western MacArthur Company (A028702), Western MacArthur Company appeals from a judgment entered on a jury verdict awarding damages for personal injuries and loss of consortium, after a court trial on the issue of successorship resulted in a finding of successor liability. In the three writ proceedings, Western MacArthur Company v. Superior Court (In re Shipyard and Applicator Asbestos Cases (Kazan & Kilbourne)) (A030047); and Western MacArthur Company v. Superior Court (In re Sterns, Brown & Finney, Consolidated for Discovery, Related Shipyard and Applicator Asbestos Cases) (A030125); and Western MacArthur Company v. Superior Court (In re Related Asbestos Cases Consolidated for Pretrial Matters (Knapp)) (A031922), Western MacArthur Company challenges orders of the Superior Court of Alameda County which grant summary judgment on the successorship issue to numerous asbestos plaintiffs, whose suits have been consolidated for discovery and other pretrial matters. 1 In Cretan v. Fibreboard Corp. et al., Western MacArthur Company appeals from a stipulated judgment, having reserved the right to seek appellate review of the summary adjudication orders at issue in the writ proceedings. We consolidated the proceedings. 2 In Kaminski, Western MacArthur Company challenges the successorship determination and raises several other issues. In the writ proceedings, the company argues that triable issues of material fact remain on the successorship contention, and that the granting of summary judgment was error. 3 Because the successorship issue has already been presented to a trier of fact in Kaminski, we first review that proceeding.
Jack and Rose Kaminski sued several asbestos manufacturers and distributors, including Johns-Manville and Western MacArthur Company, for personal injuries and loss of consortium caused by asbestos exposure. Jack Kaminski suffered from mesothelioma, a fatal illness caused by inhaling asbestos dust or fibers. The Kaminskis settled with all codefendants except Western MacArthur Company. The preliminary issue of successor liability of Western MacArthur Company for the product liability of Western MacArthur Company for the product liability of its predecessor was separately tried to the court, which found the company liable under Ray v. Alad Corp. (1977) 19 Cal.3d 22, 136 Cal.Rptr. 574, 560 P.2d 3. The issues of products liability and damages were then tried to a jury, which found the asbestos to be a defective product. The jury awarded $400,000 for Jack Kaminski's personal injuries and $100,000 for Rose Kaminski's loss of consortium. The amount of the judgment was reduced by the amounts received in settlement from the codefendants.
Jack Kaminski was exposed to asbestos during 1942, when at the age of 21 he was employed at the Bethlehem Shipyard in San Francisco as a shipfitter's helper. From May to June of 1942, he worked at Moore Drydock in Alameda, then returned to Bethlehem during the summer months, and in the fall of 1942 resigned to enlist in the Army Air Force.
While employed at Bethlehem, Kaminski helped welders install aluminum angle bars in the ammunition compartments of 1,650-ton destroyers. Kaminski's job was to hold the bars in place with an asbestos cloth, or blanket, while the bars were welded to the bulkhead. Kaminski would also drape himself with the cloth to ward off sparks and occasionally tore the cloth, which released asbestos dust. In the confined and unventilated ammunition compartment, the air was constantly dusty and the asbestos dust permeated Kaminski's hair, clothing and tools. Kaminski also worked around others installing asbestos insulation. Kaminski was also exposed to asbestos insulation in the two months he worked at Moore Drydock.
Jack Kaminski was unaware of any health hazard posed by exposure to asbestos or the breathing of asbestos dust. No warnings were placed on the asbestos products, and no one informed Kaminski of any danger.
In 1982, 40 years after his exposure to asbestos, Jack Kaminski was diagnosed as having malignant mesothelioma. Malignant mesothelioma is untreatable, painful, and invariably fatal. The only treatment is palliative, to ease the effect of the pain and other symptoms and extend life to a certain degree. 4
There is substantial evidence that Jack Kaminski's mesothelioma was caused by exposure to asbestos. Kaminski's testimony established that the only such exposure occurred during his wartime work at Bethlehem Shipyard and Moore Drydock. Western Asbestos Company supplied all or virtually all the asbestos products used at Bethlehem Shipyard, including asbestos cloth and pipe insulation. It also performed much of the insulation work on destroyers built at Bethlehem Shipyard. It was conceded that Western Asbestos did not supply asbestos products to Moore Drydock.
The Western Asbestos Company (hereafter usually "Western") was formed in the early 1900's, and became a Bay Area distributor of Johns-Manville asbestos products in 1930 or 1932. The company established a reputation as a reliable business. By 1965, it was suffering financial setbacks and was in urgent need of operating capital. Rather than dissolve the corporation and lose everything, the corporation's three stockholder-directors (Purcell, Wayland and Kelly) contacted J.G. Ordway of the MacArthur Company of St. Paul, Minnesota (hereafter "MacArthur"), with an offer to sell Western to MacArthur. MacArthur distributed building materials, owned a subsidiary which distributed Johns-Manville asbestos products, and had maintained a relationship with the Johns-Manville Company dating back to the early 1900's. MacArthur eventually became the parent corporation to Western MacArthur Company (hereafter "Western MacArthur").
On August 20, 1965, MacArthur's agents and Western's directors executed a "Memorandum of Agreement" which gave MacArthur complete operational control of Western. MacArthur agreed to take over and assume the active management and control of all business operations; the agreement twice more used the phrase "take-over" to describe the transfer of managerial control. A MacArthur employee, Philip A. Taylor, was designated executive vice-president and full-time general manager of Western.
MacArthur's managerial control was described as "without limitation," and included authority to supervise the purchase of materials and handling of inventory; the hiring, firing and fixing of wages of Western employees; management of sales activities and contract operations; purchase or leasing of real and personal property on behalf of Western; and the right to obtain financing and incur indebtedness in Western's name. Western's original three directors stayed on but had no role in the management of the business, and received nominal salaries. They were obligated by the agreement to approve and properly implement all recommendations by MacArthur pertinent to the management of the company. Both J.G. Ordway, MacArthur's president, and Philip Taylor were made directors of Western.
MacArthur was to receive as fee 50 percent of Western's net profits. MacArthur...
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