Leonard v. Aluminum Co. of America

• Decision Date: 02 August 1985
• Docket Number: No. 84-1467,84-1467
• Citation: 767 F.2d 134
• Parties: Prod.Liab.Rep.(CCH)P 10,607 Earl R. LEONARD, Plaintiff-Appellee, v. ALUMINUM COMPANY OF AMERICA, Defendant-Third-Party Plaintiff-Appellant, v. TEMPLE DR. PEPPER BOTTLING CO., INC., Third-Party Defendant-Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 134

767 F.2d 134

Prod.Liab.Rep.(CCH)P 10,607

Earl R. LEONARD, Plaintiff-Appellee, v. ALUMINUM COMPANY OF AMERICA, Defendant-Third-Party Plaintiff-Appellant, v. TEMPLE DR. PEPPER BOTTLING CO., INC., Third-Party Defendant-Appellee.

No. 84-1467.

United States Court of Appeals Fifth Circuit.

Aug. 2, 1985.

Mayor, Day & Caldwell, Michael O. Connelly, Robert M. Roach, Jr., Houston, Tex., for defendant-third-party plaintiff-appellant.

Robert J. Hanley, Waco, Tex., for Albertson's Inc.

Williams, Pattillo & Squires, Rod S. Squires, Dale D. Williams, Waco, Tex., for E. Leonard.

Cowles, Sorrells, Patterson & Thompson, P.C., David M. Macdonald, Michael W. Huddleston, Dallas, Tex., for Temple Dr. Pepper Bottling Co., Inc.

Appeal from the United States District Court for the Western District of Texas.

Before RUBIN, WILLIAMS and DAVIS, Circuit Judges.

JERRE S. WILLIAMS, Circuit Judge:

Appellee Earl R. Leonard sued appellant Aluminum Company of America (Alcoa) because an aluminum cap that Alcoa had partially manufactured prematurely released from a large bottle of Dr. Pepper and forcibly struck one of his eyes. Alcoa joined appellee Temple Dr. Pepper Bottling Company, Inc. (Temple) as a third-party defendant because Temple had agreed to indemnify Alcoa against claims and expenses "arising in connection with" Temple's use of a capping machine that Alcoa had sold Temple. Finding that the indemnity clause did not "clearly and unequivocally" express Temple's indemnity obligation and that the clause lacked "conspicuousness", the district court rendered summary judgment in Temple's favor. After a trial, the court also entered judgment against Alcoa on a jury finding that Alcoa committed negligence in failing to warn Leonard that bottle caps might suddenly take flight.

We reverse both judgments. Because Texas law imposed no duty upon Alcoa to warn Leonard, we render judgment that he take nothing on his negligence claim. We also hold that the indemnity clause obligated Temple to reimburse Alcoa for its costs of defending this suit. We accordingly remand the case for a trial to determine Alcoa's damages. ¹

In Texas, a negligence claim arises when the plaintiff sustains damages that proximately result from the defendant's breach of a legal duty he owed to the plaintiff. E.g., Colvin v. Red Steel Co., 682 S.W.2d 243, 245 (Tex.1984). To succeed on a negligence theory, therefore, the plaintiff must show the existence of a legal duty. E.g., Abalos v. Oil Development Co. of Texas, 544 S.W.2d 627, 631 (Tex.1976). Whether such a duty exists under the circumstances constitutes a question of law for the court to decide. Saucedo v. Phillips Petroleum Co., 670 F.2d 634, 636 (5th Cir.) (applying Texas law), cert. denied, 459 U.S. 839, 103 S.Ct. 87, 74 L.Ed.2d 81 (1982).

Alcoa now contends, as it did below, that it had no duty to warn Leonard of the danger that a bottler might improperly crimp and seal the aluminum cap and that, consequently, the carbonation might abruptly hurl the cap from the bottle. A recent decision of the Texas Court of Appeals compels us to agree. In Alm v. Aluminum Co. of America, 687 S.W.2d 374 (Tex.App.1985), the court stated:

Alcoa's duty to give adequate warning, however, did not extend to Alm. Alcoa's duty to warn ended with J.F.W. [the bottler], which then had the duty to communicate the warning to consumers. This is because Alcoa had no control over the labeling of the soft drinks. The bottler is the one possessing the adequate means to pass warnings on to consumers. A manufacturer is not liable for miscarriages in the communication process that are not attributable to his failure to give adequate warning. This may occur where an intermediate party is notified of the danger, or discovers it himself, and proceeds to deliberately ignore it and pass the product on without a warning. Borel v. Fibreboard Paper Products Corp., 493 F.2d 1076, 1091 (5th Cir.1973)....

687 S.W.2d at 382. We accept the Alm opinion as a definitive statement of Texas law. See, e.g., Mott v. Mitsubishi International Corp., 636 F.2d 1073, 1074 (5th Cir.1981) ("A decision of the Court of Civil Appeals is controlling on questions of state law in this court, absent strong indication that the Texas Supreme Court would decide the issue differently."). As a matter of law, therefore, Alcoa owed no legal duty to warn. We accordingly reverse the judgment holding Alcoa liable in negligence and render judgment in its favor.

We also reverse the summary judgment against Alcoa on its third-party claim for indemnity. Texas courts will enforce an agreement that protects the indemnitee from his own negligence only if the contract gives the indemnitor "fair notice" of his obligation to indemnify. Goodyear Tire & Rubber v. Jefferson Construction, 565 S.W.2d 916, 919 (Tex.1978) (quoting Spence & Howe Construction v. Gulf Oil, 365 S.W.2d 631, 634 (Tex.1963)). Giving fair notice means not only expressing the indemnity obligation clearly and unequivocally but also making the indemnity provision conspicuous in the contract. Id.; see Gulf Oil v. Burlington Northern Railroad, 751 F.2d 746, 749 (5th Cir.1985) (applying Texas law); Eastman Kodak Co. v. Exxon Corp., 603 S.W.2d 208, 211 (Tex.1980); Safway Scaffold Co. v. Safway Steel Products, 570 S.W.2d 225, 227-28 (Tex.Civ.App.1978, writ ref'd n.r.e.).

Our judgment that Leonard take nothing on his negligence claim, however, means that Alcoa does not need indemnification for the consequences of its own negligence but only for the attorney fees it paid and the other expenses it incurred in prosecuting its defense. The...