Pratt v. Hercules, Inc., C 80-0582A.

Decision Date04 May 1982
Docket NumberNo. C 80-0582A.,C 80-0582A.
Citation570 F. Supp. 773
PartiesRichard T. PRATT, Ladd Christensen and Evergreen Investment, Ltd., Plaintiffs, v. HERCULES, INC., Defendant.
CourtU.S. District Court — District of Utah

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Richard W. Casey, and Jay D. Gurmankin, Salt Lake City, Utah, for plaintiffs.

Keith E. Taylor, Salt Lake City, Utah, for defendant.

MEMORANDUM OPINION SUPPORTING PARTIAL SUMMARY JUDGMENT

ALDON J. ANDERSON, Chief Judge.

BACKGROUND FACTS

This action was originally filed in the Third Judicial District Court for Salt Lake County, State of Utah, claiming jurisdiction over the defendant under Section 78-27-24, U.C.A. (1953), as amended. Defendant Hercules removed the case to this court pursuant to 28 U.S.C. Section 1446, claiming jurisdiction under 28 U.S.C. Section 1332.

Plaintiffs Richard T. Pratt and Ladd Christensen hold graduate degrees in Business Administration. Plaintiff Evergreen Investment, Ltd., is a limited partnership established for the benefit of the wife and children of A. Blaine Huntsman, Jr. Mr. Huntsman holds a Ph.D. in economics. At the time of the purchase of the property now in dispute, Mr. Huntsman was the general partner of Huntsman/Evergreen Investment, Ltd. He is no longer involved in the limited partnership, nor is he a party to the suit. The plaintiffs have extensive experience in purchasing and developing real estate.

Defendant Hercules is a corporation of the state of Delaware and maintains its principal place of business in Wilmington, Delaware. As a multi-national company it manufactures a diverse line of explosives, rocket fuels, insecticides and other chemical products. In 1913 Hercules, Inc. purchased property for its Utah operations in what was then the remote western portion of Salt Lake Valley. (Unless indicated to the contrary, the name Hercules as used hereinafter will refer solely to its Utah operations, which are named the Bacchus Works.) At present the manufacturing facility is spread over some 2,970 acres, of which Hercules owns 2,450 and the United States owns the remaining 520 acres. Defendant relates without contest that the United States Navy established a Naval Industrial Reserve Ordnance Plant (NIROP) on federal property within the Hercules facilities in 1960. Manufacturing processes involved in the manufacture of the Trident missile system are carried on jointly on both NIROP and Hercules property by Hercules and employees. At the Bacchus Works Hercules is a first-tier contractor in the Trident I, Pershing II and MX missile programs. There is no dispute that through the exercise of its constitutional authority to establish the political policy governing national defense and military appropriations, Congress has determined that the advancement of the missile programs is critical to the national defense of the United States. Defense contracts for the construction of these missiles must meet specific safety standards and operational requirements established by the Department of Defense Explosive Safety Board (DDESB). In addition to meeting these mandatory standards, Hercules has voluntarily met higher safety standards in certain areas of the manufacturing process. The United States is the only one who can modify compliance with safety standards after a project has begun. There is no indication that the United States has attempted to do so.

In 1977 the plaintiffs purchased either outright or an option on approximately 183 acres of land lying to the north of the Hercules plant. At that time the land was zoned for agricultural use. Shortly after purchase the plaintiffs were successful in securing a rezoning of 93 acres for residential development and 90 acres for light industry. Thirty-six acres of the land rezoned for residential use were thereafter developed by the construction of 150 homes. Defendant Hercules had objected to the proposed change in zoning.

Apparently immediately prior to the time that plaintiffs' land was rezoned, the Salt Lake County Planning Commission asked defendant Hercules to provide it with detailed information relative to the type and degree of hazard that its operations presented to adjoining landowners. The duties of the Planning Commission most important in this case deal with zoning.

17-27-9. Planning commission — Zoning — Right to regulate. — The county planning commission of any county may, and upon order of the board of county commissioners in any county having a county planning commission, shall make a zoning plan or plans for zoning all or any part of the unincorporated territory within such county, ...

Section 17-27-9 U.C.A. (1953). (The Salt Lake County Planning Commission will hereinafter be referred to as the "Zoning" Commission to indicate its pertinent activities.) In April of 1980 Hercules submitted the requested report analyzing the risks of damage to the structures and persons on adjoining property. This report recommended that despite the fact that there were still some fifty-seven acres still zoned for residential use, future development of land not be permitted. The court has not been given any evidence of any formal action taken by the Zoning Commission or County Commissioners of Salt Lake County relative to the recommendations made by Hercules or on any request by the plaintiffs to allow further building.

Plaintiffs' complaint alleges eleven causes of action. These actions can be characterized within three basic categories. First, due to the hazard and risk associated with the manufacture of high-explosive rocket motors and other military hardware, the defendant's operation constitutes a public and private nuisance. Second, the existence of this hazard and the high risk of explosion constitute an ultrahazardous activity and strict liability should be imposed for all damages that flow therefrom. Third, there are four related causes of action which deal with representations made by Hercules to the Zoning Commission which allegedly were fraudulent and damaged the plaintiffs. The plaintiffs claim they have been damaged because "the value of plaintiffs' property, being held for investment purposes, has been greatly impaired, significantly damaging plaintiffs' opportunity to resell the property for residential and industrial purposes." (Amended Complaint, Para. 26.) There is no allegation that an explosion or any actual trespass on the plaintiffs' property by concussion or otherwise has occurred. It is also uncontested that the non-governmental work performed by Hercules at the plant does not involve explosive material in any way.

Hercules has filed two motions for summary judgment. After the first motion was filed, plaintiffs amended their complaint to include charges of negligence, ultrahazardous operations, and misrepresentations before the Zoning Commission.

The court has heard arguments on both motions and has reviewed in detail all of the memoranda, affidavits, depositions and accompanying exhibits submitted to the court. As a result of this review the court is convinced that except for the last four claims of misrepresentation the claims of plaintiffs will not stand, whether viewed under state or federal law.

UNDISPUTED FACTS

The Tenth Circuit has placed in proper perspective the singular importance of undisputed facts in motions for summary judgment.

Summary judgment must be denied if a genuine issue of material fact is presented to the trial court. Exnicious v. United States, 563 F.2d 418, 423 (10th Cir.1977). In making this determination, the evidence must be viewed in the light most favorable to the party opposing the motion. National Aviation Underwriters v. Altus Flying Service, Inc., 555 F.2d 778, 784 (10th Cir.1977). Thus, summary judgment should be denied if inferences can be drawn from conflicting evidence. Madison v. Deseret Livestock Co., 574 F.2d 1027, 1036 (10th Cir.1978).
Ruhs v. Pacific Power & Light, 671 F.2d 1268 at 1270, (10th Cir.1982). In accord with this direction, the court will outline the undisputed and critical facts used by the court in granting defendant's motions for summary judgment.1

As noted earlier, plaintiffs' amended complaint may be divided into three basic categories of causes of action relative to nuisance, ultrahazardous operations and fraudulent misrepresentation. The court has decided relevant questions in the first two categories under Utah and federal law. The last category has been considered solely as a matter of state law.

Defendant Hercules has claimed, inter alia, that plaintiffs' state causes of action relative to nuisance should be dismissed by reason of Section 78-38-5 and Section 78-38-6, U.C.A. (1981). Notwithstanding plaintiffs' arguments to the contrary, this court has found as a matter of law that the new statutes apply to this case. However, in accord with the new legislation, plaintiffs have attempted to demonstrate the possibility that Hercules has either (1) expanded operations since 1977 when their property was purchased or (2) negligently operated the manufacturing operations. A serious dispute as to either of these facts would prevent the court from applying the new legislation at this stage of the proceedings.

The court does not find plaintiffs' effort to place the question of Hercules' expanding operations in dispute sufficient for two reasons. First, aside from general pleading based on information and belief, (Amended Complaint, Paras. 23, 35), the evidence of Hercules expanding its operations was only mentioned in oral argument on October 7, 1981. Counsel summarized statements he had allegedly recently read in the transcript of a second deposition taken of Ernest A. Mettenet, Jr. (Transcript of Oral Argument, October 7, 1981, at 39-40). (Hereinafter referred to as T.R.) However, this second deposition has not been filed with the court. The court may not take hearsay representations made by counsel in oral argument as being true...

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    ...McNamara, 373 F.2d 664 (D.C.Cir.), cert. denied, 387 U.S. 945, 87 S.Ct. 2078, 18 L.Ed.2d 1332 (1967). See also Pratt v. Hercules, Inc., 570 F.Supp. 773, 802-804 (D.Utah 1982) (scope of derivative sovereign immunity afforded to defense subcontractor); Concerned About Trident v. Schlesinger, ......
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    ...with the government. While federal courts certainly have not always required such a relationship, see, e.g., Pratt v. Hercules, Inc., 570 F.Supp. 773, 803 (D.Utah 1982), it is the law at least in this Circuit that the contractor must be an agent of the government before invoking its immunit......
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    ...2008); Zemaitis v. DuPage Cty. Bd. of Elections Comm'rs., 1988 WL 89954, at *6 (N.D. Ill. 1988)(Williams, J.); Pratt v. Hercules, Inc., 570 F. Supp. 773, 780 (D. Utah 1982). In short, quite apart from the prohibition against counsel of record being witnesses in the case, their representatio......
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