McCloud v. Leavitt Corporation

• Decision Date: 09 August 1948
• Docket Number: 792-D.,Civil Actions No. 773-D
• Citation: 79 F. Supp. 286
• Parties: McCLOUD v. LEAVITT CORPORATION et al. CATT v. LEAVITT CORPORATION et al.
• Court: U.S. District Court — Eastern District of Illinois

79 F. Supp. 286

McCLOUD v. LEAVITT CORPORATION et al.

CATT v. LEAVITT CORPORATION et al.

Civil Actions Nos. 773-D, 792-D.

District Court, E. D. Illinois.

August 9, 1948.

Acton, Acton, Baldwin & Bookwalter, of Danville, Ill., and Fesler, Elam & Fauver, of Indianapolis, Ind., for plaintiffs.

Mann & Stifler, of Danville, Ill., for defendant Leavitt.

Steely, Dysert & Norwood, of Danville, Ill., for defendant Bailey & Hines.

LINDLEY, District Judge.

The complaint alleges that, in the summer of 1946, defendants contracted to manufacture and deliver to Purdue University, a grandstand with 42 rows or tiers of seats, which was to comply with the standard "Underwriter's" specifications for strength and safety; that the grandstand was delivered and installed in November, 1946; that defendants well knew that the grandstand was to be used by students and others, in great numbers during athletic contests and other events and that any defect in construction would be likely to result in injury to those making use of the structure; that defendants were guilty of various acts of negligence and carelessness in the manufacture and construction and installation of the structure; that the grandstand was in such negligent defective condition as to be imminently dangerous to persons using it; that on February 5, 1947, while plaintiff was seated on the grandstand as a spectator at a basketball game, it collapsed, causing permanent injury to plaintiff, all as a proximate result of the negligence of defendants with respect to the various defects enumerated in the complaint, all of which were known, or by the exercise of reasonable care, should have been known to defendants, and that at the time of the injuries complained of, plaintiff was in the exercise of due care for her own safety.

Defendants move to dismiss upon the ground that the complaint fails to show any privity of relationship or contract between plaintiff and defendants out of which arose any duty by defendants to plaintiff as to design, manufacture or construction of the grandstand, thus presenting the narrow question of whether a manufacturer or builder stands in such a relationship to an injured third party user as will give rise to a negligence action based on negligent defects in the manufactured article. The question is old in the law, and at an early date the courts promulgated the so-called "general rule" that a manufacturer is not liable for negligence to remote vendees or other third persons with whom he has had no contractural relations. This doctrine had its source in the famous case of Winterbottom v. Wright, 1842, 10 Mees & W. 109. In that case, defendant had contracted to deliver certain mail coaches, and to keep them in good condition. Defendant negligently failed to keep them repaired, and as a result, plaintiff, a driver of one of the coaches, was injured. In his action against the defendant, a demurrer to the complaint was sustained. One of several opinions in the case based denial of recovery on the fact that there was no privity of contract between the parties. This thought was carried into American cases, and it soon came to be the rule with us that a manufacturer is not liable for negligence to remote vendees or other third persons with whom he has no contractual relations. But exceptions to the rule soon made their appearance. One such was recognized in cases where the article in question is "inherently dangerous."

Much more could be said concerning the history of the rule, the exceptions gradually developed, and its subsequent abandonment by most jurisdictions in this country. But, since the subject is ably discussed in an editorial note appearing in 164 A.L.R. 569, I deem it unnecessary to lengthen unduly this memorandum by a discussion of all of the developments there noted. See also 46 Am.Jurisp. Sales, Sec 812 and 1947 Pocket Supl. Suffice it to say that in 1916, Mr. Justice Cardozo's decision in McPherson v. Buick Motor Co., 217 N. Y. 382, 111 N.E. 1050, L.R.A.1916F, 696, Ann.Cas.1916C, 440, laid the foundation for the modern approach to the measure of the manufacturer's liability. In that case, plaintiff was riding in an automobile manufactured by defendant and sold to plaintiff by a retail dealer. Due to a defective wheel, the car suddenly collapsed and plaintiff was injured. Defendant had bought the wheel from another manufacturer, but had omitted to inspect it before placing it upon the car. The court held that the manufacturer was liable for negligence to the remote vendee. Mr. Justice Cardozo, after pointing out certain exceptions to the so-called "general rule" of nonliability in certain cases, as, for example, in the case of falsely labeled poisons, as in Thomas v. Winchester, 6 N.Y. 397, 57 Am.Dec. 455, said 217 N.Y. 382, 111 N.E. 1053: "We hold, then, that the principle of Thomas v. Winchester is not limited to poisons, explosives, and things of like nature, to things which in their normal operation are implements of destruction. If the nature of a thing is such that it is reasonably certain to place life and limb in peril when negligently made, it is then a thing of danger. Its nature gives warning of the consequences to be expected. If to the element of danger there is added knowledge that the thing will be used by persons other than the purchaser, and used without new tests, then, irrespective of contract, the manufacturer of this thing of danger is under a duty to make it carefully." Justice Cardozo took a realistic view of the question. He recognized the weakness of a rule in which "privity of contract" was used as a test for determining liability in a tort action. The only question in such an action should be "was it reasonably forseeable that negligence by the manufacturer would result in the injury complained of?" The fact that most jurisdictions in this country have either expressly repudiated the "general rule," or have made so many exceptions that they have virtually "swallowed up the rule," would seem convincing proof of the soundness of the McPherson case.

Here, the defendants knew that the grandstand would be used for seating spectators at sporting events. Such was to be its normal use, and the use to which it was being put at the time of the accident. It was also reasonably foreseeable that the grandstand would inevitably be dangerous to life and limb, if it were negligently constructed. Under the modern doctrine of liability, stemming from McPherson v. Buick Motor Co., supra, the complaint states a cause of action. However, inasmuch as the parties agree that the case is governed by the law of Indiana, the place where the injury complained of was received, in deciding the motion to dismiss, I must ultimately look to the Indiana cases, and from them determine the rule abiding in that state. My question is, "what is the law of Indiana?"

The first case cited by defendants is Daugherty v. Herzog, 1896, 145 Ind. 255, 44 N.E. 457, 32 L.R.A. 837, 57 Am.St.Rep. 204. There, plaintiff's daughter had been killed by a falling building which had been negligently remodeled by the defendant, a contractor. In sustaining a demurrer to the complaint, the court held that the defendant contractor's duty extended no farther than to the owner of the building. For authority, Winterbottom v. Wright was cited. However, the court recognized the exception to nonliability in cases involving the sale of articles inherently dangerous to life.

In Laudeman v. Russell & Co. et al., 1910, 46 Ind.App. 32, 91 N.E. 822, an employee of the buyer of a steam engine was killed by an explosion of the boiler. In a suit against the manufacturer and seller of the engine, it was alleged that the boiler was defective, and that the defendants knew or by the exercise of reasonable care should have known that the boiler was defective. A demurrer to the complaint was sustained on the ground that the engine was not an inherently dangerous article, and that there was no fraudulent concealment of a defect, and that, since there was no privity of contract between the parties, an action for negligence would not lie.

In Travis, Adm'x, v. Rochester Bridge Co., 1918, 188 Ind. 79, 122 N.E. 1, 2, plaintiff's husband was killed by the falling of a bridge constructed by defendant on a public highway under a contract with the Board of Commissioners of LaPorte County. The bridge had been constructed according to plans and specifications submitted by the Board, and had been accepted by the County five years before the accident. Once again, the court sustained a demurrer to the complaint, saying: "Many cases have been cited by appellant involving the liability of manufacturers of machinery, conveyances, and other articles sold in the regular course of trade, for injuries resulting to persons not parties to the contract on account of defects in the construction of the article sold. The relations involved in such cases are analogous to those in the case at bar, but they are not identical; and the rules of law which apply, while similar in many respects, are not the same. In the class of cases to which the one at bar belongs, the work is generally done by the contractor in accordance with plans furnished by the party letting the contract or under his direction and supervision, and the work is subject to inspection before acceptance. In the other class of cases to which reference is made, the machinery or other article manufactured is made according to the plans of the manufacturer and under his direction and subject to his inspection before sale. The differences pointed out between the classes of cases under consideration...