Monsanto Co. v. Miller

• Decision Date: 26 October 1983
• Docket Number: No. 1-783A213,1-783A213
• Citation: 455 N.E.2d 392
• Parties: MONSANTO COMPANY, Defendant-Appellant, v. Robert MILLER, Phyllis Miller, Stephen Miller, and Beverly Miller, Plaintiffs- Appellees.
• Court: Indiana Appellate Court

Page 392

455 N.E.2d 392

MONSANTO COMPANY, Defendant-Appellant, v. Robert MILLER, Phyllis Miller, Stephen Miller, and Beverly Miller, Plaintiffs- Appellees.

No. 1-783A213.

Court of Appeals of Indiana First District.

Oct. 26, 1983.

Michael R. Fruehwald, John J. Kish, Barnes & Thornburg, Indianapolis, for defendant-appellant.

Richard J. Wood, Mellen, Mellen & Wood, Richard D. McIntyre, Sr., McIntyre & McIntyre, Bedford, for plaintiffs-appellees.

NEAL, Judge.

STATEMENT OF THE CASE

Defendant-appellant, Monsanto Company (Monsanto), brings this interlocutory appeal following the denial of its motion to dismiss by the Greene Circuit Court in favor of plaintiffs-appellees, Robert, Phyllis, Stephen and Beverly Miller (Millers). Monsanto claims Millers' suit for damages is barred by the applicable statute of limitations.

STATEMENT OF THE FACTS

As stated in Millers' complaint, in 1970 Bloomfield Silo Co. constructed a silo on land owned by Millers, to be used in connection with Millers' dairy farm. The inside of the concrete silo was coated with a substance known as cumar, which was found to contain polychlorinated biphenyls (PCBs). PCBs are toxic chemicals which have been determined to be undesirable for human consumption. Upon completion, the silo was used to store silage which was subsequently fed to Millers' dairy cattle.

On August 20, 1976, as a result of tests conducted by the Indiana Board of Health on August 3, Millers were notified that their herd's raw milk contained PCBs. This contamination was caused by the cows' ingestion of feed which had been stored in the PCB-coated silo. In 1977, Bloomfield Silo Co. recoated Millers' silo with a non-toxic substance in an effort to reduce the amount of PCBs in the herd's milk. However, the PCB level in the milk rose to a new high in 1978, and Bloomfield Silo Co. recoated Millers' silo again in 1980. As of 1981, following a further increase in the amount of PCBs in their raw milk, Millers' cows were no longer fed silage from the contaminated silo. On February 8, 1982, Millers were notified by the State Board of Health that the silo was going to be condemned, which condemnation officially occurred in June. Millers filed a complaint for damages on July 28, naming Bloomfield Silo Co. and Monsanto as defendants. Millers cause of action against Bloomfield Silo Co. was dismissed on January 18, 1983, pursuant to Ind.Code 34-4-20-2 (1983). Monsanto's

motion to dismiss, based on Millers' alleged failure to timely file the complaint within the applicable statute of limitations period, was denied on June 27, 1983.

DISCUSSION AND DECISION

The sole issue presented on appeal is whether the trial court erred in failing to dismiss Millers' action against Monsanto.

Millers assert loss of the use of the PCB-coated silo as the basis for this action. The resulting reduction in the size of Millers' herd and the decrease in milk production are merely consequential damages.

The applicable statute of limitations is determined by the nature or substance of the cause of action. Shideler v. Dwyer, (1981) Ind., 417 N.E.2d 281. Indiana's product liability law applies to "all actions brought for or on account of ... property damage caused by, or resulting from, the manufacture, construction or design of any product". Ind.Code 33-1-1.5-2. Millers' claim against Monsanto, the manufacturer of the toxic silo coating, falls within the scope of this statute. Ind.Code 33-1-1.5-5 states the time period within which a products liability action must be brought:

"This section applies to all persons regardless of minority or legal disability. Notwithstanding IC 34-1-2-5, any product liability action must be commenced within two (2) years after the cause of action accrues or within ten (10) years after the delivery of the product to the initial user or consumer; except that, if the cause of action accrues more than eight (8) years but not more than ten (10) years after that initial delivery, the action may be commenced at any time within two (2) years after the cause of action accrues."

As elucidated in Dague v. Piper Aircraft Corporation., (1981) Ind., 418 N.E.2d 207, suit must be brought within both ten years of delivery to the initial user and two years of the accrual date to meet the requirements of I.C. 33-1-1.5-5. However, Indiana's product liability statutes do not apply to a cause of action which accrued before June 1, 1978. Ind.Code 33-1-1.5-8(b).

In the event Millers' cause of action is determined to have accrued prior to June 1, 1978, the applicable statute of limitations would be that covering injuries to real property, Ind.Code 34-1-2-1, which reads:

"The following actions shall be commenced with six (6) years after the cause of action has accrued, and not afterwards.... For injuries to property other than personal property, damages for any detention thereof, and for recovering possession of personal property...."

Both Ind.Code 33-1-1.5-5 and Ind.Code 34-1-2-1 are accrual statutes; therefore, the date Millers' cause of action became ripe will determine which statute applies here. Both statutes begin to run when a complete cause of action has accrued or when a person becomes liable to an action. Babson Bros. Co. v. Tipstar, (1983) Ind.App., 446 N.E.2d 11. A cause of action accrues when an injury, wrongfully inflicted, causes damage. Scates v. State, (1978) 178 Ind.App. 624, 383 N.E.2d 491. It is not necessary that the extent of the damage be known or even ascertainable, but only that some ascertainable damage has occurred. Shideler, supra. Failure to discover a right to bring suit does not operate to suspend the statute of limitations. Fidelity and Casualty Company of New York v. Jasper Furniture Company, (1917) 186 Ind. 566, 117 N.E. 258; French v. Hickman Moving & Storage, (1980) Ind.App., 400 N.E.2d 1384. Likewise, no new cause of action will accrue when consequential damages arise from a prior injury and damage too slight to be noticed when inflicted. City of North Vernon v. Voegler, (1885) 103 Ind. 314, 2 N.E. 821; Schmidt v. Merchants Despatch Transp. Co., (1936) 270 N.Y. 287, 200 N.E. 824.

To determine when Millers' cause of action accrued, we must identify the injury and the resultant damages. The "injury" is the wrongful act which caused the loss. The "damages" are the recompense covering the loss; the scale or measure of recovery. City of North Vernon, supra. In the present case, the injury occurred when Monsanto's cumar, which contained PCBs, was applied to the inside of Millers' silo in 1970. When the resulting damage became ascertainable depends on facts not found in the record. When there is a factual issue concerning the date on which a cause of action accrues, and a statute of limitations begins to run, the question is generally one for the fact finder. Babson Bros. supra. However, in the interest of judicial economy, and because the exact accrual date is not crucial to our final determination, we will discuss each of the possibilities.

We do not agree with Monsanto that Millers' cause of action accrued upon application of the cumar to the silo. At the time Millers' silo was coated with the toxic cumar, the full impact of PCBs on humans was not known. There were no restrictions on their use, and no damages could have been ascertained. In any event, no damage could possibly occur until the contaminated silage was fed to Millers' herd. Cf., Gahimer v. Virginia-Carolina Chemical Corporation, (7th Cir.1957) 241 F.2d 836. Nor do we concur with the trial court and Millers, that the cause of action accrued when Millers discovered the herd's raw milk contained PCBs. See French, supra.

Because of a recent surge of litigation in the area, and the unicity of this case, some recitation of the historical and constitutional background of the regulation of PCBs is warranted. Until the mid-1960's, PCBs in the environment had been mistaken for pesticide residues. See, Comment, Federal Toxics Control: The Patchwork Attack on PCBs, 6 Envir.L.Rep. (Envir.Law Inst.) 10056, 10056 & nn. 1 & 2 (1976). PCBs, which are resistant to flame, heat, and electrical current, had been widely used for industrial purposes. Upon discovery of their adverse effects on wildlife and man, measures were instituted to reduce human exposure to PCBs. Beginning in 1973, the existence of PCBs in animal feed, food packaging materials and food was restricted by the Federal Food and Drug Administration (FDA). ¹ See 38 Fed.Reg. 18096. Effective September 4, 1973, temporary tolerance levels of PCBs in products were established allowing for the gradual replacement of PCBs with a non-toxic substance in industries linked to human consumption. However, the FDA did not provide an adjustment period for the elimination of PCBs in silo coatings, stating:

"... The use of PCB-containing coatings on the inner walls of silos has resulted in the contamination of silage which has in turn caused PCB residues in the milk of dairy cows consuming the contaminated silage. Since PCB's are toxic chemicals, the PCB contamination of food as a result of these and other incidents represent a hazard to public health. It is therefore necessary to place certain restrictions on the industrial uses of PCB's in the production, handling, and storage of animal feed.

The following special provisions are necessary to preclude accidental PCB contamination of animal feed:

(1) Coatings or paints for use on the contact surfaces of feed storage areas may not contain PCB's or any other harmful or deleterious substances likely to contaminate feed...."

21 C.F.R. Sec. 500.45 (1983)

The Department of Health, Education and Welfare enacted 21 CFR Sec. 500.45 pursuant to the Federal Food, Drug and Cosmetic Act (Federal Act), 21 U.S.C.A., Sec. 301 et seq. (1972). The Federal Act rests upon the constitutional power of Congress to regulate interstate commerce. Congress may also regulate purely intrastate matters when necessary to attain appropriate control over...