McKay v. Rockwell Intern. Corp.

• Decision Date: 20 April 1983
• Docket Number: Nos. 81-5540,s. 81-5540
• Parties: Janice McKAY, Executrix of the Estate of Lt. Cdr. Malcolm Wagner McKay, Deceased, Plaintiff-Appellant, v. ROCKWELL INTERNATIONAL CORPORATION, a Delaware corporation, Defendant-Appellee. Marie CARSON, Administratrix of the Estate of Frank J. Carson, Deceased, Plaintiff-Appellant, v. ROCKWELL INTERNATIONAL CORPORATION, a Delaware corporation, Defendant-Appellee. to 81-5543.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 444

704 F.2d 444

Janice McKAY, Executrix of the Estate of Lt. Cdr. Malcolm

Wagner McKay, Deceased, Plaintiff-Appellant, v. ROCKWELL INTERNATIONAL CORPORATION, a Delaware corporation,

Defendant-Appellee.

Marie CARSON, Administratrix of the Estate of Frank J.

Carson, Deceased, Plaintiff-Appellant, v. ROCKWELL INTERNATIONAL CORPORATION, a Delaware corporation,

Defendant-Appellee.

Nos. 81-5540 to 81-5543.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Oct. 5, 1982.

Decided April 20, 1983.

Martin E. Jacobs, Irwin, Hale & Jacobs, Los Angeles, Cal., for plaintiffs-appellants.

Robert Forgnone, Gibson, Dunn & Crutcher, Los Angeles, Cal., for defendant-appellee.

Appeal from the United States District Court for the Central District of California.

Before SNEED, and ALARCON, Circuit Judges, and HARDY ^*, District Judge.

SNEED, Circuit Judge:

These are consolidated wrongful death actions arising out of two unrelated crashes of RA-5C naval aircraft in the waters off the coast of Florida. The widows of the two Navy pilots killed in the crashes seek damages from Rockwell International Corp. ("Rockwell"), the manufacturer of the RA-5C aircraft and its ejection system. The district court held that Rockwell was liable for the pilots' deaths because of defects in the aircraft's ejection system. Both the widows and Rockwell have appealed.

In this case we confront the question under what circumstances, if any, the doctrine of strict liability in tort, as set forth in section 402A of the Second Restatement of Torts, should be extended to cover manufacturers of military equipment that proves to be defective in design and injures members of the armed forces who are on active duty. We also must address the question whether, under the circumstances of this case, sections 388 and 389 of the Second Restatement impose liability on Rockwell. For the reasons set forth below we reverse the judgment of the district court and remand for further proceedings.

I. FACTS

Rockwell, under contract with the United States Navy, began development in the mid-1950s of an aircraft capable of sustained flight at altitudes of up to 75,000 feet, and with a potential speed of two and a half times the speed of sound. In the early 1960s, the Navy decided to redesign the aircraft as a supersonic carrier-based reconnaissance aircraft, designated the RA-5C "Vigilante." The RA-5C was put into use by the Navy in 1962 and was used extensively in Vietnam.

Both the RA-5C aircraft involved in the accidents out of which these cases arise were equipped with the HS-1A escape system. This system was a modified version of an earlier escape system in use in the RA-5C aircraft. The HS-1A system operated by physically restraining the crew in their seats, and then ejecting them ballistically into the airstream by means of a rocket thrust. After ejection, a drogue chute would initiate the opening of a 28-foot parachute to enable the crewmen to descend safely to the ground.

On March 5, 1974, Navy Lieutenant Frank Carson was killed during a daytime training mission when the RA-5C aircraft he piloted caught fire and he was forced to eject from the aircraft. Navy Lieutenant Commander Malcolm McKay was killed on August 13, 1974, after ejecting from a burning RA-5C aircraft during a night training mission. Autopsies of the two pilots revealed that their deaths were probably caused by injuries sustained during ejection.

Plaintiffs filed civil actions in the United States District Court for the Central District The cases were consolidated for trial and, after an evidentiary hearing, the district court determined that it had admiralty jurisdiction over the actions pursuant to the Death on the High Seas Act, 46 U.S.C. Secs. 761-767. ¹ The district court found that Rockwell properly was liable for the design of the HS-1A escape system under the principles of tort law set forth in sections 388, 389, and 402A of the Second Restatement of Torts. The court declined to impose liability under these principles for the design of the RA-5C aircraft. It entered judgment after a trial on the merits in favor of plaintiff Carson for $385,703.00 and in favor of plaintiff McKay for $325,850.00. Carson and McKay seek review of the measure and amount of damages awarded in their respective judgments. Rockwell also appeals, contending that military suppliers should not be liable to servicemen for injuries caused by defects in military hardware. ² Our disposition of Rockwell's appeal makes it unnecessary to address the appeals of Carson and McKay.

of California, seeking recovery of damages for the death of plaintiffs' decedents under theories of negligence, breach of warranty, and wrongful death.

II. LIABILITY UNDER SECTION 402A OF THE SECOND RESTATEMENT OF TORTS

The district court, as stated above, held that Rockwell was liable under section 402A of the Second Restatement of Torts for defects in the design of the HS-1A escape system. ³ We applied the principles of this section in admiralty in Pan-Alaska Fisheries, Inc. v. Marine Construction & Design Co., 565 F.2d 1129 (9th Cir.1978). But in Pan-Alaska we did not hold that strict liability applies for all purposes and for all defendants. ⁴ Section 402A is not a federal statute. It should be applied only when the purposes it seeks to serve dictate its application. When that is not the case it has no independent force. To apply it merely because it is there is to abdicate judicial responsibility.

Mindful of this responsibility, we conclude that only under the limited circumstances we shall enumerate below should a manufacturer be held strictly liable in tort for injuries to a serviceman on active duty caused by design defects in military equipment.

A. Feres-Stencel Doctrine

We commence our analysis with Feres v. United States, 340 U.S. 135, 71 S.Ct. 153, 95 L.Ed. 152 (1950). In that case the Supreme Court held that the United States is not subject to liability under the Federal Tort Claims Act, 28 U.S.C. Sec. 2674, to a member of the armed forces who sustains an injury while on active duty. The scope of governmental immunity was broadened recently in Stencel Aero Engineering Corp. v. United States, 431 U.S. 666, 97 S.Ct. 2054, 52 L.Ed.2d 665 (1977). There, the Court held that the Federal Tort Claims Act precludes the United States from indemnifying a third party for damages paid by it to a member of the armed forces who is injured during military service. The Stencel Court explained that allowing indemnity would subject the United States to varying degrees of liability, depending on the situs of the accident, would require the United States to pay indirectly to the serviceman what the Veterans' Benefits Act forbids it to pay directly, and would interfere with military discipline. Id. at 672-73, 97 S.Ct. at 2058-59.

Thus, under the circumstances of these cases, the United States would be immune both from direct tort liability as well as from the obligation of indemnifying Rockwell for damages it might be required to pay.

B. Government Contractor Defense

Given the immunities of the United States in cases such as these, the question arises whether a supplier of military equipment should be required to shoulder directly and immediately the entire burden of the liability to an injured serviceman. Some courts, when confronted with this issue, have relied on the so-called government contractor defense. ⁵ This rule, first articulated by the Supreme Court in Yearsley v. W.A. Ross Construction Co., 309 U.S. 18, 60 S.Ct. 413, 84 L.Ed. 554 (1940), protects a government contractor from liability for acts done by him while complying with government specifications during execution of performance of a contract with the United States. See Myers v. United States, 323 F.2d 580, 583 (9th Cir.1963). The rule has been applied when the United States is immune from suit. Dolphin Gardens, Inc. v. United States, 243 F.Supp. 824, 827 (D.Conn.1965).

While the government contractor defense covered at first only construction projects, it has recently been applied by several courts to military equipment design defect cases. ⁶ See Note, 23 B.C.L.Rev. 1025, 1055-64 (1982). For example, in Sanner v. Ford Motor Co., 144 N.J.Super. 1, 364 A.2d 43 (1976), aff'd, 154 N.J.Super. 407, 381 A.2d 805 (1977), cert. denied, 75 N.J. 616, 384 A.2d 846 (1978), the court held that when a manufacturer produces a jeep in compliance with government specifications, the manufacturer cannot be held strictly liable for defects in the government's design specifications. Similarly, in Casabianca v. Casabianca, 104 Misc.2d 348, 428 N.Y.S.2d 400 (1980), the manufacturer of kitchen equipment made for the Army and in accordance with Army specifications was held not to be subject to liability for defects in the equipment. Finally, in In Re Agent Orange Product Liability Litigation, 534 F.Supp. 1046 (E.D.N.Y.1982), the court approved a government contractor defense for manufacturers of a chemical defoliant where the government set or ratified performance specifications for a product, the manufacturer The reasons for applying the government contractor defense to suppliers of military equipment with design defects approved by the government parallel those supporting the Feres-Stencel doctrine. First, the Supreme Court emphasized in Stencel that the United States cannot be directly or indirectly liable to servicemen injured by defective military products. ⁷ But holding the supplier liable in government contractor cases without regard to the extent of government involvement in fixing the product's design and specifications would subvert the Feres-Stencel rule since military suppliers, despite the government's immunity, would pass the cost of accidents off to the United States through cost overrun provisions in equipment contracts, through reflecting the price of liability insurance in the contracts, or through higher prices in later equipment sales. See In Re Agent Orange...