Murphy v. Owens-Corning Fiberglas Corp.

• Decision Date: 06 February 2003
• Docket Number: No. 25740.,25740.
• Citation: 590 S.E.2d 479,356 S.C. 592
• Court: South Carolina Supreme Court
• Parties: Janet B. MURPHY and David M. Murphy, Respondents, v. OWENS-CORNING FIBERGLAS CORP., Pittsburgh Corning Corporation, and as successor to Unarco Industries, Inc., ACandS, Inc., Rock Wool Manufacturing Co., Inc., The Anchor Packing Company, Rapid American Corporation, Garlock, Inc., Westinghouse Electric Corporation, Uniroyal, Inc., Metropolitan Life Insurance Co., Fibreboard Corporation, National Service Industries, Inc., A.P. Green Industries, Inc., Flexitallic Gasket Company, Inc., GAF Corporation, Armstrong World Industries, Inc., Asbestos Claims Management Co., United States Gypsum Company, T & N, PLC., C.E. Thurston & Sons, Inc., PPG Industries, Inc., Covil Corporation, and E.I. Dupont de Nemours and Company, Defendants, of which E.I. Dupont De Nemours and Company is Petitioner.

356 S.C. 592

590 S.E.2d 479

Janet B. MURPHY and David M. Murphy, Respondents, v. OWENS-CORNING FIBERGLAS CORP., Pittsburgh Corning Corporation, and as successor to Unarco Industries, Inc., ACandS, Inc., Rock Wool Manufacturing Co., Inc., The Anchor Packing Company, Rapid American Corporation, Garlock, Inc., Westinghouse Electric Corporation, Uniroyal, Inc., Metropolitan Life Insurance Co., Fibreboard Corporation, National Service Industries, Inc., A.P. Green Industries, Inc., Flexitallic Gasket Company, Inc., GAF Corporation, Armstrong World Industries, Inc., Asbestos Claims Management Co., United States Gypsum Company, T & N, PLC., C.E. Thurston & Sons, Inc., PPG Industries, Inc., Covil Corporation, and E.I. Dupont de Nemours and Company, Defendants, of which E.I. Dupont De Nemours and Company is Petitioner.

No. 25740.

Supreme Court of South Carolina.

Heard February 6, 2003.

Refiled December 8, 2003.

David E. Dukes, C. Mitchell Brown, and Michael W. Hogue, all of Nelson Mullins Riley & Scarborough, L.L.P., of Columbia, for petitioner.

L. Joel Chastain, of West Columbia, Terry E. Richardson, Jr., and Daniel S. Haltiwanger, both Richardson, Patrick, Westbrook and Brickman, L.L.C., of Barnwell, V. Brian Bevon, of Ness, Motley, of Mt. Pleasant, and William J. Cook, of Ness, Motley, of Barnwell, for respondents.

R. Bruce Shaw and W. Thomas Causby, both of Nelson Mullins Riley & Scarborough, of Columbia, for Amicus Curiae Owens-Illinois, Inc.

Justice PLEICONES:

We granted certiorari to consider when a "cause of action shall have arisen ... within this State" under the Door Closing Statute, S.C.Code Ann. § 15-5-150 (1976), where the cause of action is a tort suit premised on a latent disease claim. The circuit court held this suit barred by the statute, and a panel of the Court of Appeals affirmed. The case was then reheard en banc, and by a vote of 7 to 2,¹ the Court of Appeals held the Door Closing Statute did not apply. Murphy v. Owens-Corning Fiberglas Corp., 346 S.C. 37, 550 S.E.2d 589 (Ct.App.2001). We granted certiorari and now affirm.

FACTS

Petitioner E.I. du Pont de Nemours and Company (petitioner) employed respondent Janet Murphy's (Janet's) father (Father) as a chemical engineer from 1951 to 1984. Father was exposed to insulating asbestos dust and fibers in the course of his employment as he observed the reconfiguration of textile spinning equipment.

Father worked at petitioner's Virginia plant from 1951 to 1966. Janet was born in 1960. From 1966 until 1969 the family lived in South Carolina. They returned to Virginia until 1974, then spent four years overseas, and Father spent the last six years of his employment with petitioner in Virginia.

In July 1995, Janet was diagnosed with mesothelioma, a lung cancer.² She brought this tort action in South Carolina, and her husband (David) brought his loss of consortium suit here. They allege Janet developed the disease as the result of her childhood exposure to asbestos fibers and dust in Father's clothing. Further, they contend that while Father was exposed to asbestos at all of petitioner's facilities, his exposure was greatest at the South Carolina plant.

Petitioner moved to dismiss Janet's and David's claims under Rule 12(b)(1), SCRCP, on the grounds South Carolina lacked subject matter jurisdiction over the suits in light of the Door Closing Statute. The circuit court dismissed the actions. See e.g. Nix v. Mercury Motor Express, Inc., 270 S.C. 477, 242 S.E.2d 683 (1978)

. Janet and David appealed, and the en banc Court of Appeals reversed. Murphy v. Owens-Corning, supra. Following the circuit court's ruling and the decision of the Court of Appeals, we overruled our precedents including Nix which had held that the Door Closing Statute determines subject matter jurisdiction, and explained that the statute in fact governs a party's capacity to sue. Farmer v. Monsanto Corp., 353 S.C. 553, 579 S.E.2d 325 (2003).

LAW

The Door Closing Statute provides:

§ 15-5-150. Foreign corporations as defendants.

An action against a corporation created by or under the laws of any other state, government, or country may be brought in the circuit court:

(1) By any resident of this State for any cause of action; or

(2) By a plaintiff not a resident of this State when the cause of action shall have arisen or the subject of the action shall be situated within this State.

In this case, subsection (2) of § 15-5-150 is the relevant provision since neither Janet nor David is a South Carolina resident. In Ophuls & Hill v. Carolina Ice & Fuel Co., 160 S.C. 441, 158 S.E. 824 (1931), the Court explicated the meaning of the statutory terms `cause of action' and `subject of the action.' `Cause of action' was "described as being a legal wrong threatened or committed against the complaining party" while the `subject of the action' was defined as "the matter or thing, differing both from the wrong and the relief, in regard to which the controversy has arisen, concerning which the wrong has been done; and this is, ordinarily the property, or the contract and its subject matter, or other thing involved in the dispute." Id. at 450, 158 S.E. at 827 (emphasis in original). In this tort case, the focus is on the term `cause of action,' and not on the `subject of the action.'

In order for Janet to bring her suit³ in South Carolina, she must meet the Door Closing Statute's requirement that "the cause of action shall have arisen ... within this State." § 15-5-150(2). Janet's complaint unequivocally meets the `cause of action' component of this requirement since she alleges that the legal wrong occurred in South Carolina when she was exposed to asbestos fibers and dust on Father's clothing. Ophuls & Hill v. Carolina Ice & Fuel Co., supra. As the Court of Appeals held, the critical inquiry here is whether the cause of action arose within the State. We thus examine, for the first time, when a latent disease cause of action `arises.' Cf. Grillo v. Speedrite Prods., Inc., 340 S.C. 498, 532 S.E.2d 1 (Ct.App.2000)

cert. denied December 12, 2000 (discovery rule/statute of limitations in toxic exposure case). In doing so, we reexamine our precedents which equate the terms `arise' and `accrue.'

Our consideration of the novel issue raised by this case begins with an examination of the policies underlying the Door Closing Statute. Those policies have been articulated as follows:

(1) It favors resident plaintiffs over nonresident plaintiffs;

(2) It provides a forum for wrongs connected with the State while avoiding the resolution of wrongs in which the State has little interest; and

(3) It encourages activity and investment within the State by foreign corporations without subjecting them to actions unrelated to their activity within the State.

Farmer v. Monsanto Corp., supra citing Rosenthal v. Unarco Industries, Inc., 278 S.C. 420, 297 S.E.2d 638 (1982).

The first policy, favoring resident plaintiffs, is reflected in subsection (1) of § 15-5-150 of the Door Closing Statute, which allows "any resident of this State" to maintain "any cause of action." This subsection, essentially "opening the Door" for resident plaintiffs, is irrelevant to determining whether Janet, a nonresident, has the capacity to maintain this suit. The second policy expressed in the statute restricts actions brought in state courts to those where the alleged wrong is connected to the State. Janet's suit does not offend this policy. The third policy consideration when a nonresident seeks to sue a foreign corporation in state court is whether the suit is predicated on the corporation's in-state activities. Id. Permitting Janet to maintain her action in our state courts does not contravene this policy. Having concluded that no fundamental policy would be offended by this suit, we turn to the arise/accrue distinction.

In traditional tort settings, we have held that a cause of action arises in this State for purposes of the Door Closing Statute when the plaintiff has the right to bring suit. See Cornelius v. Atlantic Grey Hound Lines, 177 S.C. 93, 180 S.E. 791 (1935). In construing the statutory requirement that "the cause of action shall have arisen ... within in this State," the Cornelius court cited with approval to an authority that "stated that `a cause of action accrues when facts exist which authorize one party to maintain an action against another.'" Id. at 96, 180 S.E. at 792 (emphasis supplied). Cornelius is consistent with our later decision in Stephens v. Draffin, 327 S.C. 1, 488 S.E.2d 307 (1997), where we held "our cases use the verbs `arise' and `accrue' interchangeably when discussing the issue of the juncture at which the right to sue came into existence." Id. at footnote 4; see also Tilley v. Pacesetter Corp., 355 S.C. 361, 585 S.E.2d 292 (2003)

.

Were we to apply our traditional view of when a tort cause of action arises or accrues, we must conclude that Janet's cause of action did not arise "within the State" because no injury or damages occurred while she was in South Carolina.⁴ Until the exposure to asbestos resulted in injury or damage, Janet's tort cause of action did not accrue. See e.g., Gray v. Southern Facilities, 256 S.C. 558, 183 S.E.2d 438 (1971)

("It is basic that a negligent act is not in itself actionable and only becomes such when it results in injury or damage to another"). Respondents urge us to reconsider whether to recognize a distinction between the terms `arise' and `accrue' in the context of latent disease tort actions within the ambit of the Door Closing Statute.

As explained above, the policies reflected in the Door Closing Statute would not be offended by allowing Janet's suit to proceed in state court. The only obstacle to Janet's maintenance of this action results from the nature of the latent disease process.

We find that it is not appropriate to apply a strict accrual test to latent disease tort actions brought by a nonresident against a foreign corporation. We hold that the...