Peterson v. Little-Giant Glencoe Portable Elevator Div. of Dynamics Corp. of America

• Decision Date: 12 April 1985
• Docket Number: LITTLE-GIANT,No. C6-83-1376,C6-83-1376
• Citation: 366 N.W.2d 111
• Parties: Neoma PETERSON, as Trustee for the Heirs of Rodney R. Peterson, Respondent, v.GLENCOE PORTABLE ELEVATOR DIVISION OF DYNAMICS CORPORATION OF AMERICA, Respondent, Easterlund Implement, Inc., Appellant. Prince Manufacturing Corporation, Respondent.
• Court: Minnesota Supreme Court

Page 111

366 N.W.2d 111

Neoma PETERSON, as Trustee for the Heirs of Rodney R Peterson, Respondent, v. LITTLE-GIANT GLENCOE PORTABLE ELEVATOR DIVISION OF DYNAMICS CORPORATION OF AMERICA, Respondent Easterlund Implement, Inc., Appellant Prince Manufacturing Corporation, Respondent.

No. C6-83-1376.

Supreme Court of Minnesota.

April 12, 1985.

Syllabus by the Court

1. The trial court did not abuse its discretion when instructing the jury about

the mid-trial settlements between the defendants Glencoe and Prince.

2. Easterlund was not entitled to a directed verdict in strict liability on its cross-claim against Glencoe and Prince.

3. Easterlund, as a common enterpriser with the deceased worker's employer, is liable for contribution to other defendants to the extent of its percentage of negligence, but not more than the workers' compensation benefits due.

Donald M. Jardine, John C. Dunlap, St. Paul, for appellant.

Robert T. Stitch, Minneapolis, for respondent.

Heard, considered, and decided by the court en banc.

OPINION

YETKA, Justice.

This case comes to this court on a petition for further review of a decision of the Minnesota Court of Appeals. 349 N.W.2d 280. The case involves a products liability action arising from the death of Rodney R. Peterson while demonstrating farm equipment manufactured by Little-Giant Glencoe Portable Elevator Division of Dynamics Corporation of America (Glencoe) and owned by Easterlund Implement, Inc., (Easterlund). Both Glencoe and Easterlund were sued by Peterson's heirs. Glencoe impleaded Prince Manufacturing Corporation (Prince), the manufacturer of a hydraulic cylinder used on the farm implement that killed Peterson. The plaintiffs amended their complaint, bringing a direct action against Prince. All the defendants cross-claimed for contribution and indemnity. Peterson's employer, Lindsay Brothers, Inc., was not named in the suit since the heirs received workers' compensation benefits, thus making the employer immune from direct suit.

A jury found Glencoe 65% negligent, Easterlund 35% negligent, and Prince 0% negligent. After the jury verdict, Easterlund's petition for judgment notwithstanding the verdict was denied. The court did rule after the close of the evidence that Peterson and Easterlund's employees were engaged in a common enterprise and thus immune from a suit under tort by reason of the workers' compensation laws, but held that Easterlund was liable to Glencoe in the amount of $262,500, which represented 35% of a settlement made during trial with plaintiffs for total payments to plaintiffs of $750,000. We affirm the trial court on two of the issues raised, but reverse the trial court's award of contribution and remand for further action.

Rodney Peterson was killed on April 8, 1981, when a wing of a farm implement he was demonstrating fell on him. The implement was a 24' 9"' Glencoe soil finisher. The finisher was manufactured by Little-Giant Glencoe Portable Elevator Division of Dynamics Corporation of America and sold to Lindsay Brothers, Inc., an implement dealer and Peterson's employer. Lindsay Brothers, in turn, sold the implement in the spring of 1980 to Easterlund Implement, Inc., on a floor plan arrangement. Part of the purchase price was paid immediately, with the remainder due when the implement was sold. Title remained with Lindsay Brothers. Prince Manufacturing Corp., the party impleaded by Glencoe, manufactured the hydraulic cylinder used to raise and lower the wing that fell on Peterson.

The soil finisher is a large piece of machinery designed to be towed behind a tractor. It was a new product designed to save time and fuel by allowing a farmer to prepare a seed bed in one pass. Since the implement is large, its ends were designed to fold up to facilitate transportation. The ends folded up like wings to roughly a 90-degree angle with the aid of a hydraulic system. During transport, the wings were held secure by pins.

The accident occurred when Peterson was helping prepare the soil finisher for a demonstration at the request of Easterlund. Peterson arrived early with Douglas Easterlund, several of Easterlund's employees another Lindsay Brothers employee, and the owner of the farm. They intended to prepare the finisher and make a quick test run before breaking for lunch and then returning for the demonstration. According to the finisher's manual, the wings should be "sucked up," that is, the hydraulic system activated and the wings drawn in as far as they would go, before lowering them. This is a safety precaution to purge the system of any trapped air and to determine if the cylinders are fully charged. The wings were not, however, "sucked up." The Easterlund employees and the Lindsay Brothers employee climbed on top of the finisher to loosen some straps; Douglas Easterlund went to unpin the left wing; Peterson went to unpin the right wing. Just as Douglas Easterlund took his pin out, the left wing fell. Through luck or fate, he knows not which, Easterlund rolled away to safety. Before he could yell a warning, however, Peterson unpinned the right wing which immediately fell, driving him to the ground with fatal force.

After the accident, the cylinders were recharged with hydraulic fluid. They worked perfectly when tested and were sold to a Wisconsin farmer without modification and apparently performed well. A video tape showing the cylinder on the finisher working was played for the jury.

During trial, two settlements were reached. Prince and Glencoe agreed that, for $225,000, Glencoe would take over Prince's defense and indemnify Prince for all losses, including attorney fees. The Prince lawyers made no further appearances at trial.

The second settlement involved damages. The defendants agreed to settle all claims for $650,000 cash and an annuity with a present-day value of not less than $100,000. The plaintiffs continued to present evidence of the defendants' negligence. Part of the stipulation provided that Peterson would not be considered negligent. The jury was left to apportion fault between the defendants and found Glencoe 65% negligent, Easterlund 35% negligent, and Prince 0% negligent. No strict liability was found.

Easterlund raises three issues on appeal:

1. Did the trial court abuse its discretion by refusing to instruct the jury that Prince was to be represented by Glencoe after the settlement?

2. Was Easterlund entitled to a directed verdict in strict liability against Glencoe and Prince?

3. Was Glencoe entitled to contribution from Easterlund even though Easterlund was immune from a direct action by the plaintiffs because of workers' compensation law?

1. When parties agree to a mid-trial settlement, "the trial court and other parties should be immediately notified, and the terms of the agreement made a part of the record." Frey v. Snelgrove, 269 N.W.2d 918, 923 (Minn.1978). The trial court and other parties were so informed in this case and the terms of the agreement read into the record out of the jury's hearing. The jury should also be informed "if for no other reason than to explain the settling tortfeasor's conspicuous absence from the court room." Simonett, Release of Joint Tortfeasors: Use of the Perringer Release in Minnesota, 3 Wm. Mitchell L.Rev. 1, 30 (1977). The extent of disclosure of settlement terms is, however, within the discretion of the trial court. The jury should have "those facts necessary to arrive at a fair verdict to all parties * * *." Frey, 269 N.W.2d at 923.

Immediately after the settlement, the jury was informed:

I note there is an absence of a couple of the attorneys this morning, Mr. Hanson and Mr. Archibald. An agreement has been reached which will no longer require that the attorneys for Prince Manufacturing Corporation be present; however, you are advised that you are to continue to evaluate the evidence as to Prince and as to all other parties. Further instructions will be given to you upon conclusion of this trial on these particular matters.

Those further instructions were given the next day as the trial court instructed the jury following the close of the evidence:

As mentioned to you yesterday, the parties did reach an agreement in this case and they reached an agreement among other things as to damages in the case. Therefore, you need not consider that matter but you will have to determine what proportion of negligence, if any, should be assigned to each of the three defendants: Easterlund Implement, Inc., Glencoe Portable Elevator, and Prince Manufacturing. Essentially, that will be your job, to make those determinations.

Thus, the jury was informed that Prince was still a party to the action despite the absence of its attorneys.

Easterlund claims that, "[d]espite unrebutted testimony that the hydraulic cylinder manufactured by Prince and used on the right wing of the soil finisher was defective, the jury returned a verdict of no liability against Prince." Contrary to counsel's assertion, the testimony was not unrebutted. Once charged, the cylinder worked well. It was sold, without repairs, to a Wisconsin farmer and worked fine. The jury saw a video tape of the actual cylinder, unrepaired and unmodified, working. When presented with conflicting evidence on an issue, this court can only assume that the jury weighed the evidence and found the losing side's evidence wanting.

Easterlund's concern that the jury did not have the facts necessary to consider the indemnity agreement is a concern that the jury could not properly weigh the credibility of witnesses. Counsel could have impeached any witnesses as this court noted in the Frey case: "[A] release agreement is admissible under Rule 408 of the Rules of Evidence, where it is offered for a purpose such as proving bias or prejudice of a witness * * *." Frey, 269 N.W.2d at 923. In this case, the settlement occurred fairly late in the 8-day trial, a day before its close. Most of the evidence about the cylinder was already...