Menendez v. Paddock Pool Const. Co.

• Decision Date: 10 December 1991
• Docket Number: No. 1,CA-CV,1
• Citation: 172 Ariz. 258,836 P.2d 968
• Parties: , Prod.Liab.Rep. (CCH) P 13,115 Luis MENENDEZ, and Michele Menendez, husband and wife; Angela Marie Menendez, a minor, Amanda Elizabeth Menendez, a minor, and Nichole Andrea Menendez, a minor, By and Through Michele Menendez, Guardian Ad Litem, Plaintiffs-Appellants, v. PADDOCK POOL CONSTRUCTION CO., an Arizona corporation; Paddock Pool Engineering Corporation, an Arizona corporation; American Continental Corporation, an Ohio corporation; Continental Homes, Inc., an Ohio corporation; Continental Homes, Inc., an Arizona corporation; Continental Homes of Arizona; American Continental Homes, Inc., an Ohio corporation; Larry C. Fischer, Defendants-Appellees. 88-296.
• Court: Arizona Court of Appeals

Page 968

836 P.2d 968

172 Ariz. 258, Prod.Liab.Rep. (CCH) P 13,115

Luis MENENDEZ, and Michele Menendez, husband and wife; Angela Marie Menendez, a minor, Amanda Elizabeth Menendez, a minor, and Nichole Andrea Menendez, a minor, By and Through Michele Menendez, Guardian Ad Litem, Plaintiffs-Appellants, v. PADDOCK POOL CONSTRUCTION CO., an Arizona corporation; Paddock Pool Engineering Corporation, an Arizona corporation; American Continental Corporation, an Ohio corporation; Continental Homes, Inc., an Ohio corporation; Continental Homes, Inc., an Arizona corporation; Continental Homes of Arizona; American Continental Homes, Inc., an Ohio corporation; Larry C. Fischer, Defendants-Appellees.

No. 1 CA-CV 88-296.

Court of Appeals of Arizona Division 1, Department C.

Dec. 10, 1991.

Review Denied Oct. 6, 1992.

[172 Ariz. 259] Paul G. Ulrich, P.C. by Paul G. Ulrich and Nancy C. Thompson and Tod F. Schleier, P.C. by Tod F. Schleier and Sheldon J. Schlesinger, P.A. by Sheldon J. Schlesinger,

[172 Ariz. 260] Phoenix, and Robert W. Kelly, Fort Lauderdale, for appellants.

Bonnett, Fairbourn & Friedman, P.C. by William G. Fairbourn, Andrew S. Friedman, Robert J. Spurlock, Phoenix, for appellees Paddock Pool Const. Co. and Paddock Pool Engineering Corp.

Gallagher & Kennedy, P.A. by John E. Lundin, E. Calvin Fuchs, R. Lynne Goggans, Phoenix, for appellees American Continental Corp. and Larry C. Fischer.

OPINION

TAYLOR, Presiding Judge.

FACTS

Appellant Luis Menendez was an employee and kitchen training supervisor for TGI Friday's, Inc. (TGIF). On the evening of June 29, 1985, TGIF hosted a private party at the La Casita recreational common area of the Dobson Ranch subdivision in Mesa, Arizona. This facility, which included a large in-ground swimming pool and other amenities, was rented that evening by TGIF from 8:00 p.m. to midnight so that about two hundred of its new employees could celebrate their completion of a two-week company training program.

TGIF furnished beer and wine to the partygoers that night. Further, trainees had been told they could "get crazy" at the party and even throw their training supervisors into the swimming pool. By 9:00 p.m., the effects of alcohol consumption became noticeable. At about 9:30 p.m., after at least four supervisors had been pushed or thrown into the La Casita pool, Luis Menendez was seized by several trainees as he was leaving the party. He was then forcibly carried to the pool and thrown headlong into its shallow end where he sustained spinal injuries resulting in quadriplegia.

Luis Menendez and members of his family (hereinafter individually and collectively referred to as Menendez) subsequently sued the appellees and others on multiple theories of liability, alleging in part that the design and construction of the La Casita pool proximately caused his injury. This appeal arises only from the dismissal of the strict liability in tort and negligence counts of the complaint.

In May 1987, the trial court granted various joint and individual motions by appellees American Continental Corporation and Continental Homes (hereinafter jointly designated as Continental), ¹ Larry C. Fischer (Fischer), and Paddock Pool Construction Co. and Paddock Pool Engineering Corporation (hereinafter jointly designated as Paddock) to dismiss the strict liability in tort counts of the complaint against them. In January 1988, the court granted motions for summary judgment in favor of Continental, Fischer, and Paddock. This resulted in the dismissal of the negligence counts of the complaint against them. Menendez timely appeals both decisions. We consider each in turn.

DISCUSSION

Strict Liability in Tort

The La Casita pool had its origin in 1978 when Continental solicited bids for the design and construction of a custom, non-diving lap pool of specified dimensions. This pool was to be built at its residential development known as Dobson Ranch. Paddock was awarded the contract, which provided that the pool would be custom designed and have a maximum water depth of three feet to four-and-one-half feet. Construction of the pool was completed in 1979. In January 1980, Continental deeded the La Casita recreational property, including the pool, to the Dobson Homeowners' Association. The homeowners' association thereafter managed the facility, renting it regularly to homeowners' groups.

In the complaint, Menendez alleged several counts of strict liability in tort against (1) Continental as developer and general contractor for the pool, (2) Fischer as a corporate employee thereof, and (3) Paddock as the pool designer and building subcontractor. In its minute entry granting the motions to dismiss these counts, the trial court ruled that Menendez failed to state a claim upon which relief could be granted. The trial court found that the in-ground pool was not, as a matter of law, a "product" for purposes of strict liability in tort. Noting that such a pool is not manufactured and then introduced into the stream of commerce for sale, the trial court characterized it as a structural improvement to real property rather than as a product incorporated into an improvement to a structure.

Standard of review.

The standard of review for a grant of a motion to dismiss is to assume the truth of the allegations in the complaint and to uphold the dismissal only if plaintiffs would not be entitled to relief under any facts susceptible of proof in the stated claim. Mattison v. Johnston, 152 Ariz. 109, 114, 730 P.2d 286, 291 (App.1986). However, the record comes before us in an unusual posture for such review. The minute entry ruling, which grants the motions to dismiss, hinges on the in-ground character of the pool, a fact not alleged in the complaint but nevertheless presented by appellees to the trial court and relied upon in its ruling.

In his reply brief on appeal, Menendez argues that the standard of review for dismissal precludes our consideration of any such fact not alleged in the complaint. Since Menendez devoted a substantial portion of his opening brief to the issue of whether an in-ground pool is a product, we deem such conduct a waiver of any objection to our consideration of this fact. Moreover, the trial court's reliance on evidence extrinsic to the complaint requires us to treat the granted motions to dismiss as motions for summary judgment. Pritchard v. State, 163 Ariz. 427, 433, 788 P.2d 1178, 1184 (1990); Ariz.R.Civ.P. 12(b). ² On review, therefore, we view the evidence in the light most favorable to the party opposing summary judgment, Wagenseller v. Scottsdale Memorial Hosp., 147 Ariz. 370, 388, 710 P.2d 1025, 1043 (1985), and will uphold the ruling of the trial court only if there is no genuine issue of material fact, the undisputed material facts support but one inference, and the moving party is entitled to judgment under the substantive law. Taft v. Ball, 818 P.2d 158, 161 (App.1991); Ariz.R.Civ.P. 56(c). However, we only consider evidence that was in the record before the trial court during its summary judgment deliberations. GM Dev. Corp. v. Community Am. Mortgage Corp., 165 Ariz. 1, 4, 795 P.2d 827, 830 (App.1990).

Applicable substantive law.

A seller engaged in the business of selling a product in a defective condition unreasonably dangerous to the user or consumer is subject to strict liability in tort for physical harm or property damage caused thereby. O.S. Stapley Co. v. Miller, 103 Ariz. 556, 559, 447 P.2d 248, 251 (1968) (citing Restatement (Second) of Torts § 402A (1965)). To invoke such liability, a plaintiff must make a prima facie showing that a product is defective and unreasonably dangerous, the defect existed at the time it left defendant's control, and the defect is a proximate cause of plaintiff's injury or property loss. Rocky Mountain Fire & Casualty Co. v. Biddulph Oldsmobile, 131 Ariz. 289, 292, 640 P.2d 851, 854 (1982). Moreover, an implicit condition precedent also requires the plaintiff to show that the object or instrumentality claimed to be defective is a "product" as defined either by section 402A of the Restatement (Second) of Torts, legislation, or caselaw. Brooks v. Eugene Burger Management Corp., 215 Cal.App.3d 1611, 1626, 264 Cal.Rptr. 756, 764 (1989); accord Kaneko v. Hilo Coast Processing, 65 Haw. 447, 654 P.2d 343, 347 (1982); Radcliff Homes v. Jackson, 766 S.W.2d 63, 68 (Ky.Ct.App.1989); Papp v. Rocky Mountain Oil & Minerals, 236 Mont. 330, 769 P.2d 1249, 1252 (1989); Charlton v. Day Island Marina, 46 Wash.App. 784, 732 P.2d 1008, 1012-13 (1987); James P. Maloney, Comment, What Is or Is Not a Product Within the Meaning of Section 402A, 57 Marq.L.Rev. 625, 648 (1974). Whether an object or instrumentality is a "product" is a question of law. Brooks, 215 Cal.App.3d at 1626, 264 Cal.Rptr. at 764.

Here, the in-ground nature of the pool is undisputed. Since strict liability in tort can be invoked only if the pool is a product as defined either by the Restatement, legislation, or caselaw, we first review whether the trial court applied the correct substantive law to product characterization. Although strict liability in tort under the Restatement has long been recognized in Arizona, e.g., O.S. Stapley Co., 103 Ariz. at 559, 447 P.2d at 251, the question of whether an in-ground swimming pool falls within the definition of a product is an issue of first impression in this state.

Neither the Restatement, Arizona Revised Statutes Annotated ("A.R.S."), nor our caselaw provide a comprehensive definition of product for characterization purposes. ³ The trial court resolved the issue against Menendez by applying a principle of strict liability recited in Craft v. Wet 'N Wild, Inc., 489 So.2d 1221 (Fla.Dist.Ct.App.1986). This principle states that a structural improvement to realty is not itself subject to strict liability, although manufactured components incorporated into it could be. Id. at 1222. The trial court, citing O.S. Stapley Co., 103 Ariz. 556, 447...