Mason v. Schweizer Aircraft Corp.

• Decision Date: 14 November 2002
• Docket Number: No. 00-1231.,00-1231.
• Citation: 653 N.W.2d 543
• Parties: Kevin I. MASON, Appellant, v. SCHWEIZER AIRCRAFT CORP., Appellee.
• Court: Iowa Supreme Court

653 N.W.2d 543

Kevin I. MASON, Appellant, v. SCHWEIZER AIRCRAFT CORP., Appellee.

No. 00-1231.

Supreme Court of Iowa.

November 14, 2002.

Paul P. Morf of Simmons, Perrine, Albright & Ellwood, P.L.C., Cedar Rapids, for appellant.

Diane Kutzko and Kurt Kratovil of Shuttleworth & Ingersoll, Cedar Rapids, and Peter T. Kirchen of Kern and Wooley, L.L.P., Los Angeles, California, for appellee. Richard G. Santi of Ahlers, Cooney, Dorweiler, Haynie, Smith & Allbee, P.C., Des Moines and Frederick C. Schafrick of Shea & Gardner, Washington, D.C., for amicus curiae General Aviation Manufacturers Association.

TERNUS, Justice.

The appellant, Kevin Mason, was injured when the helicopter he was piloting crashed. Mason then brought suit against the appellee, Schweizer Aircraft Corporation, which had provided maintenance support materials to Mason's employer, the owner of the aircraft. The district court granted Schweizer's motion for summary judgment, ruling that Mason's suit was barred under the statute of repose found in the General Aviation Revitalization Act of 1994 (GARA), 49 U.S.C. § 40101 note (1994). Mason appealed. Finding no error, we affirm.

I. Background Facts and Proceedings.

On August 19, 1996, Kevin Mason, a Cedar Rapids police officer, was seriously injured when the helicopter he was piloting experienced complete engine failure and crashed. An investigation by the National Transportation Safety Board determined that the probable cause of the crash was two plastic pieces that had broken off the air filter housing and entered the air induction tubes, blocking the flow of air and fuel into the engine.

The helicopter, a Model 269A, had been manufactured by Hughes Tool Company— Aircraft Division and sold to the United States Army in 1968. Hughes Tool Company held the type certificate for the Model 269A, which had been issued by the Federal Aviation Administration (FAA). See generally 49 U.S.C. § 44704(a) (stating type certificate is issued upon a finding by the FAA "that the aircraft ... is properly designed and manufactured, performs properly, and meets the regulations and minimum standards prescribed under section 44701(a)").

Discovery in this case disclosed that in the 1960s there were reports of engine stoppages in the model 269A, presumably from a defect in the air filter housing. As a result, Hughes Tool added stiffening beads to the side of the housing to prevent cracking, incorporating this design change into production components in 1966. Hughes Tool received no further reports of similar problems following implementation of this change. For reasons not disclosed in the record, the air filter housing of the helicopter involved in the accident at issue here did not have the stiffening beads.

After some intermediate transfers of the type certificate, Schweizer purchased the Model 269 product line, including the FAA-issued type certificate, in 1986 from McDonnell Douglas Helicopter Company. Although Schweizer has never manufactured a model 269A helicopter, it has made 269C and 269D series helicopters under the type certificate purchased from McDonnell Douglas. In addition, it has provided maintenance support materials and services for the 269A model to various subscribers, one of them being the City of Cedar Rapids aviation department.

Prior to Mason's accident, the City had paid a fee to subscribe to certain Schweizer publications, including Schweizer's Handbook of Maintenance Instruction for Hughes 269A Helicopters. The subscription service arguably promoted the use of Schweizer for purchase of replacement parts. As part of the subscription service, Schweizer's personnel were available to consult with the City's mechanics by telephone. The record shows that City aviation maintenance personnel relied upon the handbook for guidance in inspecting and maintaining the helicopter. Schweizer had a procedure in place to encourage operators to provide reports on material component part failures or malfunctions, and received such reports daily. Prior to this accident, it had never received a report of engine stoppage due to air filter housing cracks or failures. There was evidence, however, that Schweizer was aware of previous problems with the air filter housing and that Hughes Tool had made design changes. On the other hand, Schweizer had no knowledge that the helicopter involved in this case did not have the modified housing.

The record reveals the City's director of maintenance had inspected the air filter housing and other parts of the helicopter in question on August 16, 1996, three days before the crash. He was aware at the time of his inspection that a cracked housing presents a safety issue and that a helicopter with a cracked air filter housing would not be airworthy. The director did not identify any cracks in the housing at the time of his inspection.

On May 5, 1998, Mason filed suit against Schweizer, alleging claims based on strict liability, implied warranties of merchantability and fitness for a particular purpose, and negligence.¹ Schweizer raised the GARA statute of repose as an affirmative defense. This statute imposes a cutoff on all civil actions against a manufacturer for death, injury or property damage caused by general aviation aircraft and their component parts eighteen years from the date of initial delivery of the aircraft. See 49 U.S.C. § 40101 note, §§ 2(a), 3(4).

After discovery, Schweizer filed a motion for summary judgment, asserting that the plaintiff's claims were barred by the statute of repose as a matter of law. It argued it was being sued in its capacity as a manufacturer of the helicopter and its components and, since the helicopter had been delivered to the initial purchaser more than eighteen years ago, suit was barred.

Mason resisted Schweizer's motion, asserting his claim against Schweizer was not based upon a products liability theory, or on any relationship between Schweizer and the actual manufacturer. Rather, contended Mason, his suit was based on Restatement (Second) of Torts section 324A, liability to a third person for negligent performance of an undertaking, based on Schweizer's provision of maintenance materials to the City of Cedar Rapids that omitted "information regarding the existence, nature, and extent of the risk caused by plastic cracks in the air filter housing." Mason argued that Schweizer was not a "manufacturer" of the helicopter within the meaning of GARA, nor was Schweizer being sued "in its capacity as a manufacturer" as required by the statute of repose.

The district court held that Schweizer, by virtue of its purchase of the type certificate, was the successor in interest of the original manufacturer and entitled to the protection of the statute of repose as a manufacturer. It also concluded that the actions Mason alleged Schweizer failed to take were based upon Schweizer's status as a manufacturer. The court ruled, therefore, that suit was barred.

Mason has now appealed. He claims the district court erred in concluding that the GARA statute of repose applied here. First, Mason contends Schweizer is not the "manufacturer" of the helicopter within the meaning of the statute. Second, he argues that even if Schweizer is the manufacturer, his theory of recovery is not based upon Schweizer's status as the manufacturer, but rather upon Schweizer's negligence in the performance of an independent undertaking pursuant to Restatement section 324A. Finally, he asserts that GARA does not bar his suit against Schweizer because Schweizer's negligent acts and omissions occurred within the past eighteen years, thereby falling within the "rolling provision" of the statute of repose. See 49 U.S.C. § 40101 note, § 2(a)(2).

II. Scope of Review.

We review a district court's summary judgment ruling for correction of errors of law. See Cato v. Am. Suzuki Motor Corp., 622 N.W.2d 486, 494 (Iowa 2001). Summary judgment is appropriate when the record shows "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Iowa R. Civ. P. 1.981(3). In determining whether the district court correctly concluded that this standard was met, we view the record in the light most favorable to the nonmoving party. Crippen v. City of Cedar Rapids, 618 N.W.2d 562, 565 (Iowa 2000).

III. For Purposes of GARA's Statute of Repose, Was Schweizer the Manufacturer of the Hughes Model 269A Helicopter Involved in This Lawsuit?

GARA was enacted in 1994 in an attempt to help "bolster the aviation industry by relieving it from an `onslaught of product liability litigation.'" Jennifer L. Anton, A Critical Evaluation of the General Aviation Revitalization Act of 1994, 63 J. Air L. & Com. 759, 762 (1994) (citation omitted) [hereinafter "Anton"]. Congress found that an important cause of the "serious decline" in the manufacture and sale of general aviation aircraft and aircraft parts in the United States was "the tremendous increase in the industry's liability insurance costs." H.R.Rep. No. 103-525, pt. 1, at 1 (1994), reprinted in 1994 U.S.C.C.A.N. 1638, 1638. It was believed that relief from the long tail of liability would revitalize the industry. Id. at 2-3, reprinted in 1994 U.S.C.C.A.N. at 1639-40. The adoption of a statute of repose was justified in committee hearings by recognition of the industry's need for protection from endless liability and the protection of the public provided by the pervasive federal regulatory control of the aviation industry:

The legislation attempts to strike a fair balance by providing some certainty to manufacturers, which will spur the development of new jobs, while preserving victims' right to bring suit for compensation in certain particularly compelling circumstances. In essence, the bill acknowledges that, for those general aviation aircraft and component parts in service beyond the statute of repose, any design or manufacturing defect not prevented or identified by the

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