McLean v. Kirby Co., a Div. of Scott Fetzer Co.

• Decision Date: 28 July 1992
• Docket Number: Nos. 910230,910238,s. 910230
• Parties: Linda McLEAN, Plaintiff and Appellee, v. The KIRBY COMPANY, a DIVISION OF the SCOTT FETZER COMPANY and the Scott Fetzer Company, Defendants and Appellants, and Michael Molachek, Defendant. Linda McLEAN, Plaintiff and Appellant, v. The KIRBY COMPANY, a DIVISION OF the SCOTT FETZER COMPANY and the Scott Fetzer Company, Defendants and Appellees, and Michael Molacheck, Defendant. Civ.
• Court: North Dakota Supreme Court

Page 229

490 N.W.2d 229

Linda McLEAN, Plaintiff and Appellee, v. The KIRBY COMPANY, a DIVISION OF the SCOTT FETZER COMPANY and the Scott Fetzer Company, Defendants and Appellants, and Michael Molachek, Defendant.

Linda McLEAN, Plaintiff and Appellant, v. The KIRBY COMPANY, a DIVISION OF the SCOTT FETZER COMPANY and the Scott Fetzer Company, Defendants and Appellees, and Michael Molacheck, Defendant.

Civ. Nos. 910230, 910238.

Supreme Court of North Dakota.

July 28, 1992.

Wold, Jacobs & Johnson, Minneapolis, Minn., for plaintiff and appellee/appellant, Linda McLean argued by Keith D. Johnson. Appearance by Calvin N. Rolfson.

Cahill, Maring & Marquart, Fargo, for defendants and appellants/appellees, Kirby Co. and the Scott Fetzer Co., argued by David S. Maring. Appearance by Daniel Dunn.

MESCHKE, Justice.

The Kirby Company, a division of the Scott Fetzer Company, and Scott Fetzer Company (hereinafter collectively referred to as Kirby) appealed from an amended judgment awarding Linda McLean damages from being raped in her apartment by Michael Molachek, a Kirby dealer. Kirby also appealed from orders denying its post-judgment motions. McLean cross-appealed from the judgment, amended judgment, and an order denying her motion for a partial new trial on her claim for punitive damages. We affirm.

Kirby manufactures vacuum cleaners and sells them through a marketing system of in-home demonstrations by door-to-door dealers. University Vacs, Inc., doing business as Kirby Co. of Fargo-Moorhead, Inc., owned by William L. Urie (hereinafter collectively referred to as Urie) became a Kirby distributor in 1972. Urie hired Molachek as a door-to-door dealer in December 1983. Urie performed no background investigation before hiring Molachek.

Molachek had been unemployed during the year before his employment with Urie as a Kirby dealer. During that year, Molachek was convicted of two assault charges and two weapons charges in Minnesota, and a Minnesota charge of criminal sexual conduct in the third degree was pending when Urie hired him.

On December 8, 1983, McLean let Molachek into her apartment to demonstrate a Kirby vacuum cleaner. Molachek also brought with him a set of knives, provided by the distributor, as a "door opener" or "gift offering" for allowing the in-home demonstration. After beginning the demonstration, Molachek used the knives in assaulting and raping McLean.

McLean sued Kirby, Urie and Molachek. McLean settled with Urie before trial. Molachek did not appear in the action. Liability of Kirby was premised upon the peculiar risk doctrine that is summarized in Restatement (2d) of Torts § 413 (1965):

One who employs an independent contractor to do work which the employer should recognize as likely to create, during its progress, a peculiar unreasonable risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the absence of such precautions if the employer

(a) fails to provide in the contract that the contractor shall take such precautions, or

(b) fails to exercise reasonable care to provide in some other manner for the taking of such precautions.

The jury returned a special verdict that found Kirby and Urie negligent, found the negligence of each proximately caused McLean's damages, attributed 30 percent of the negligence to Kirby and 70 percent to Urie, fixed McLean's damages at $150,000, and determined that McLean should not be awarded exemplary damages against Kirby. Judgment was entered in accordance with the jury verdict. Kirby and McLean appeal.

Kirby raises these questions:

I. DID THE TRIAL COURT ERR IN FAILING TO RULE, AS A MATTER OF LAW, THAT THE COMPLAINT OF THE PLAINTIFF FAILED TO STATE A CLAIM AGAINST KIRBY UPON WHICH RELIEF COULD BE GRANTED?

II. DID THE TRIAL COURT ERR IN FAILING TO RULE, AS A MATTER OF LAW, THAT THE CRIMINAL ACT OF DEFENDANT MICHAEL MOLACHEK WAS A SUPERCEDING CAUSE?

III. DID THE TRIAL COURT ERR IN RULING THAT DEFENDANT MICHAEL MOLACHEK'S FAULT WOULD NOT BE COMPARED?

IV. WAS THERE SUFFICIENT EVIDENCE TO SUPPORT A VERDICT AS AGAINST KIRBY?

McLean raises these questions:

I. DID THE TRIAL COURT ERR IN FAILING TO GIVE INSTRUCTION REGARDING THE MEANING AND DEFINITION OF RECKLESS DISREGARD ALLOWING FOR PRESUMPTION OF MALICE AND AN AWARD OF PUNITIVE DAMAGES?

II. DID THE TRIAL COURT ERR IN GIVING AN INSTRUCTION THAT THE BURDEN OF PROOF FOR PUNITIVE DAMAGES WAS BY CLEAR AND CONVINCING EVIDENCE, RATHER THAN BY A PREPONDERANCE OF THE EVIDENCE?

I. Kirby's Appeal

1. Failure to state a claim.

Kirby asserts that the trial court erred in refusing to rule that McLean's complaint failed to state a claim against Kirby upon which relief could be granted. A complaint should not be dismissed under NDRCivP 12(b)(v), for failure to state a claim upon which relief can be granted, "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Williams v. State, 405 N.W.2d 615, 620 (N.D.1987). The purpose of a motion to dismiss for failure to state a claim upon which relief can be granted "is to test the formal sufficiency of the statement of the claim for relief; it is not a procedure for resolving a contest about the facts or the merits of the case." 5A C. Wright & A. Miller, Federal Practice & Procedure: Civil 2d § 1356 (1990). "The motion to dismiss for failure to state a claim is viewed with disfavor and is rarely granted." Id. at § 1357.

We view the complaint in the light most favorable to the plaintiff and in light of NDRCivP 8(a). Williams v. State. NDRCivP 8(a) directs that a complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." "The purpose of Rule 8(a), N.D.R.Civ.P., is to put the defendant on notice as to the nature of the plaintiff's claim. If the pleadings indicate generally the type of claim involved, they satisfy the spirit of Rule 8(a), N.D.R.Civ.P." Williams v. State, 405 N.W.2d at 621.

a. duty

Kirby argues that whether one owes a duty of care toward another is a question of law for the court to decide, and that "the trial court should have ruled prior to trial, at the close of Plaintiff's evidence, or at the close of all the evidence, that no duty existed as a matter of law." Whether or not there is a duty is generally a question of law for the trial court, but if "the existence of a duty depends upon factual determinations, the facts must be resolved by the trier of fact." Madler v. McKenzie County, 467 N.W.2d 709, 711 (N.D.1991).

This court long ago recognized a duty of care where injury is likely to result unless due precautions are taken:

The rule seems to be well established that where, in the making of an improvement of any kind, it is manifest that injury is likely to result unless due precautions are taken, a duty rests upon him who causes the work to be done to see that all necessary precautions are taken.

Ruehl v. Lidgerwood Rural Tel. Co., 23 N.D. 6, 16, 135 N.W. 793, 795-96 (1912). That decision recognized that the one who caused the work to be done (digging holes for telephone posts) could not escape liability for the death of a child who fell into an unguarded hole on the theory that an independent contractor had dug the holes. This court has also recognized the duty described in Restatement (2d) of Torts § 413. See Schlenk v. Northwestern Bell Tel. Co., Inc., 329 N.W.2d 605 (N.D.1983). "Where there is a foreseeable risk of harm to others unless precautions are taken," it is the duty of one who employs another to do work to exercise reasonable care in selecting a contractor "and to provide, in the contract or otherwise, for such precautions as reasonably appear to be called for." Prosser and Keeton on Torts § 71, p. 510 (5th ed. 1984).

In ruling on Kirby's motion for summary judgment on McLean's direct negligence claim against it, the trial court stated:

The issue of a duty owing to the Plaintiff by the Kirby Company and Scott Fetzer Company is not easily resolved; however, the Court is of the opinion that the Plaintiff has established a duty on the part of Kirby Company and Scott Fetzer Company to use reasonable care in seeing that its distributors employ reasonable care in the checking or investigating of the background and fitness of prospective door-to-door salespersons so as to minimize the risk of harm to others.

In ruling on Kirby's posttrial motions, the trial court stated:

The Court was of the opinion that, pursuant to Section 413, a duty did exist, as a matter of law, upon The Kirby Company and that the Plaintiff had established a prima facie case. Whether the work assigned was a "peculiar unreasonable risk" or that such risk was foreseeable to The Kirby Company were factual matters to be determined by the jury.

The trial court determined that Kirby owed McLean a duty of care and that McLean had established a case for submission to the jury. We conclude that the trial court correctly concluded that Kirby owed a duty to McLean.

Kirby markets its products through in-home demonstrations and sales. When potential purchasers admit Kirby dealers into their homes to demonstrate Kirby products for sales, there is a foreseeable and unreasonable risk of harm to those potential customers if those dealers have past histories of crime and violence. Only by requiring its distributors to investigate potential dealers before hiring them can Kirby reduce or eliminate this unreasonable risk of harm to potential purchasers of its products. We conclude that the trial court did not err in refusing to rule "that no duty existed as a matter of law."

b. employer not liable for independent contractor's torts

Kirby argues that Urie was an independent contractor and that, unless there is a valid exception, an employer is not liable for the acts or omissions of an independent contractor. Kirby contends that "[e]xpansive adoption of rules which undermine the...