Powder Horn Nursery, Inc. v. Soil & Plant Laboratory, Inc.

• Decision Date: 16 March 1978
• Docket Number: CA-CIV,No. 1,1
• Citation: Powder Horn Nursery, Inc. v. Soil & Plant Laboratory, Inc., 579 P.2d 582, 119 Ariz. 78 (Ariz. App. 1978)
• Parties: POWDER HORN NURSERY, INC., Appellant, v. SOIL AND PLANT LABORATORY, INC., a corporation, Appellee. 3525.
• Court: Arizona Court of Appeals

Page 582

579 P.2d 582

119 Ariz. 78

POWDER HORN NURSERY, INC., Appellant, v. SOIL AND PLANT LABORATORY, INC., a corporation, Appellee.

No. 1 CA-CIV 3525.

Court of Appeals of Arizona,Division 1,Department B.

March 16, 1978.

Rehearing Denied April 28, 1978.

Review Denied May 31, 1978.

Carson, Messinger, Elliott, Laughlin & Ragan, Robert W. Holland, Phoenix, for appellant.

O'Connor, Cavanagh, Anderson, Westover, Killingsworth & Beshears, P. A., Henry L. Timmerman, Phoenix, for appellee.

OPINION

OGG, Judge.

In this appeal we must determine the proper standard of care a soil and plant laboratory must use in furnishing information to its customers.

The plaintiff/appellant Powder Horn Nursery, Inc. (Nursery) argues that the "reasonable man" test is the proper standard of care to be applied to this case. The defendant/appellee Soil and Plant Laboratory (Lab) takes the position that a plant laboratory is in a class of professional consultants and that any negligence claim against them must be measured by the professional standard of care existing within the community.

The Nursery, which conducts a commercial plant nursery in Scottsdale, Arizona, sued the Lab, located in Santa Clara, California, for $233,966.51 in damages arising from a plant loss allegedly caused by the negligence of the Lab. The Lab was awarded summary judgment against the Nursery claim and was also awarded the sum of $245.37 on its counterclaim for services rendered. The trial court rendered the judgment upon the following grounds:

. . . It is the view of the Court that the Plaintiff must establish that the Defendant failed to conform with a standard of care existing within the community. There is absolutely no evidence brought to the Court's attention indicating any opinion by a qualified expert that the advice given by Defendant breached any existing standard of care. Absent such an opinion, there is no evidence showing a breach of duty owed by the Defendant to the Plaintiff.

The Nursery appeals from this judgment and the denial of its motion for reconsideration. The Nursery claims the court erred in granting summary judgment for the following reasons:

1. The proper standard of care by which the Lab's negligence should be judged is the reasonable man test and not the more demanding test of the prevailing community standard as applied in professional malpractice cases.

2. The conflict in the professional opinions by the respective party experts relative to the proper method of diagnosing the particular plant disease raised a genuine issue of material fact which bars the granting of a motion for summary judgment.

3. The Nursery under the provisions of the Restatement (Second) of Torts § 552 established a prima facie case of negligence against the Lab when it failed to inform the Nursery on the proper methods to combat a condition known as "iron toxicity" which was destroying the Nursery's potted plants.

The facts necessary for the determination of this appeal disclose that the Nursery is in the business of raising plants for commercial sale, with an operation of approximately 5,000 containers and some field grown stock. The Lab provides professional assistance to nurserymen and offers a wide variety of professional services ranging from soil, plant and water analysis to field calls and extended area visitations. The parties had a prior business relationship dating back to 1967 or 1968, whereby the Lab provided recommendations on proper fertilization and soil mix for the Nursery's container stock. The problem which triggered this litigation arose when the Nursery, by a letter dated May 25, 1970, asked the Lab for advice on the prevention of yellowing leaves in the Nursery's container grown stock. The Lab replied by letter dated June 8, 1970, with a pertinent recommendation that iron chelate be added to the fertilizer solution. The iron chelate was implemented with the watering on June 10, 1970, and approximately one week later the plants began looking more unhealthy.

On June 25, 1970, the Lab was advised by phone that the Nursery was encountering leaf burn problems. The Lab recommended leaching the plants with clear water to remove any contaminants and requested soil and leave samples for examination. The Lab received a soil sample from the Nursery on June 29, 1970, and leaf and water samples were received the following day. The Lab report, dated July 1, 1970, found the problem "which you have recently encountered appears to be due to sudden and extreme rate of fertilizer application with nitrogen being the primary element found in excess. The formula which has been provided and presumably has been in use could not possibly result in values in the range found, if the proportioner is operating in a normal manner." The report further stated:

Although the incidence of injury coincided in some degree with the application of iron, we cannot feel that this was responsible in view of the data obtained. It appears quite certain from data and our past experience that the problem is one of extreme concentration of fertilizer being applied. (We hope you will be able to figure out how this could have occurred and certainly avoid any further repetition.)

The results of the leaf and water supply analysis were compiled in a letter dated July 6, 1970. After studying the soil samples further, the Lab issued another report in a letter dated July 11, 1970. The results of these tests, as reported to the Nursery, indicated that sodium toxicity was the primary cause of the plant decline.

The plants continued to decline, resulting in considerable damage to the Nursery's potted plants. The Nursery then instituted suit, alleging the negligence of the Lab caused the plant damage.

The decisive issue is whether the court was justified in granting the Lab's motion for a summary judgment on the basis of the Nursery's failure to establish the requisite standard of care and a departure therefrom.

In order to show negligent conduct, there must be:

1. A duty, or obligation, recognized by the law, requiring the actor to conform to a certain standard of conduct, for the protection of others against unreasonable risks.

2. A failure on his part to conform to the standard required . . . W. Prosser, Handbook of the Law of Torts, § 30 at 143 (4th ed. 1971) (Footnote omitted)

The Nursery argues that the Lab's negligence is established under the provisions of the Restatement (Second) of Torts, § 552 (1977), wherein the standard of care in such cases is set forth. The pertinent portion of § 552 reads:

One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information. (emphasis added)

The Lab argues that the comments to § 552 help clarify what "reasonable care and competence" mean and that the Restatement does not adopt the reasonable man standard of care when dealing with the dissemination of professional advice. We agree. The pertinent portion of comment (e) reads:

The particulars in which the recipient of information supplied by another is entitled to expect the exercise of care and competence depend upon the character of the information that is supplied. When the information concerns a fact not known to the recipient, he is entitled to expect that the supplier will exercise that care and competence in its ascertainment which the supplier's business or profession requires and which, therefore, the supplier professes to have by engaging in it. Thus the recipient is entitled to expect that such investigations as are necessary will be carefully made and that his informant will have normal business or professional competence to form an intelligent judgment upon the data obtained. (Emphasis added)

Case law interpreting § 552 indicates that this section must be read together with the applicable standard of care as set forth in the community of the professional. Rhode Island Hospital Trust National Bank v. Swartz, Bresenoff, Yavner & Jacobs, 455 F.2d 847 (4th Cir. 1972); Peter Kiewit Sons' Co. v. Iowa Southern Utilities Co., 355 F.Supp. 376 (S.D.Iowa C.D.1973).

The Lab further argues that § 299A of the Restatement (Second) of Torts gives further indication that the drafters of the Restatement intended to adopt the professional standard rather than the reasonable man standard of care...