Reynolds Metals Company v. Wand

• Citation: 308 F.2d 504
• Decision Date: 01 August 1962
• Docket Number: No. 17488.,17488.
• Parties: REYNOLDS METALS COMPANY, a corporation, and Henry W. Shoemaker, Appellants, v. I. B. WAND and Alice R. Wand, Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

308 F.2d 504 (1962)

REYNOLDS METALS COMPANY, a corporation, and Henry W. Shoemaker, Appellants, v. I. B. WAND and Alice R. Wand, Appellees.

No. 17488.

United States Court of Appeals Ninth Circuit.

August 1, 1962.

King, Miller, Anderson, Nash & Yerke, and Fredric A. Yerke, Jr., Portland, Or., Gustav B. Margraf, and W. Tobin Lennon, Richmond, Va., for appellant.

Koerner, Young, McColloch & Dezendorf, and Herbert H. Anderson, Portland, Or., for appellee.

Before POPE, KOELSCH and DUNIWAY, Circuit Judges.

POPE, Circuit Judge.

The appellees-plaintiffs filed a complaint against the appellants in the Circuit Court of the State of Oregon describing the complaint as one for "damages for trespass and nuisance". Thereafter the cause was removed on the petition of appellants-defendants to the above named District Court of the United States.

The complaint alleged that during the period beginning May 1, 1957, and continuing until the commencement of the action, which was on July 13, 1959, the defendants, in the operation of a certain manufacturing establishment near Troutdale, Oregon, invaded the plaintiffs' property, consisting of approximately 16 acres upon which they had been engaged in raising lilies, bulbs and flowers, and deposited thereon various noxious and dangerous gases, fumes and particulates; that this invasion rendered plaintiffs' property unfit for the growing of such products and deprived them of the use and enjoyment of their property; that they had been prevented from engaging in the bulb growing business, and in consequence for the injuries claimed they sought compensatory damages of $30,000, and $500,000 as punitive and exemplary damages.¹

The defendants' answer pleaded, among other things, the execution on July 18, 1957, by I. B. Wand and others, of a written release which for a stated consideration of $7500, released the defendant Reynolds Metals Company, its officers, agents and employees from all liability to plaintiff I. B. Wand, and the other persons named, or any of them, "as to claims and demands arising out of the location, existence or operation of said Troutdale aluminum reduction plant and at any time up to and including the day of said release for injury or damages to person or property, both real and personal owned or claimed" by the said persons executing the release or any of them, "as owner, possessor, tenant or lessee, of whatsoever nature, whether known or unknown." The execution of the release was asserted as a complete defense to the action.

Subsequently a pretrial order was settled in which certain facts were agreed upon, and the contentions of the parties stated, and in which it was stipulated that: "Trial of this action will be expedited if the issue relating to the legal effect of the release identified as Exhibit 124 is adjudicated by the court separately and prior to the trial of the other issues involved in this action."

The court proceeded to a trial of the segregated issue thus referred to and thereafter made findings of facts and conclusions, and entered an order to the effect that such release "does not bar plaintiffs' action herein." In an accompanying opinion the court found that the order thus made "involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation." Thereupon, this court, as provided in Title 28 U.S.C. § 1292(b), made an order granting the application of the appellants for permission to appeal.

The appeal was argued and submitted to us. After consideration of the record we have come to the conclusion that the trial court did not have before it sufficient evidence to permit it to reach a conclusion as to whether the release referred to did or did not bar any part of the plaintiffs' claim or claims, and that the interlocutory judgment must be reversed and set aside. In our view it is doubtful if the question as to the effect of the release can be determined short of a full trial of the case upon its merits.

It appears from the stipulations in the pretrial order that the defendant Reynolds Metals Company commenced operations at its Troutdale, Oregon, aluminum plant about September 23, 1946; that plant has been operated since that time. In its operation gases, fumes and particulates were created and carried from the plant and diffused in the air and portions thereof settled upon some of the plaintiffs' lands and the vegetation thereon. When the plant was first operated the defendant Reynolds had installed certain devices for precipitating a portion of the gases, fumes and particulates and thus minimizing the quantities escaping in the air. This cost approximately $271,846. About June 1, 1949, Reynolds commenced the installation of a different and improved device for minimizing the escape of gases, fumes and particulates. This new system cost $2,139,185; but it did not prevent all such gases, fumes and particulates from escaping. There is nothing in the record to show that any further lessening of the escape of such matters is possible.

Prior to 1946, plaintiff I. B. Wand, with two of his partners, were engaged in the commercial growing of bulbs on the land owned or occupied by them. They continued such operations as a partnership until 1953 when one of the partners, who were brothers, left the business and the other two, including I. B. Wand, continued for a year. The third partner quit in 1954. In 1955 and 1956, I. B. Wand, individually, continued to engage in the business. In 1956, I. B. Wand, himself, quit the business. At some time after 1951, I. B. Wand and his two said partners, claimed that such gases, fumes and particulates from the plant had caused injury and damage to the produce of lands used by them. On July 18, 1957, the said I. B. Wand and the other two persons mentioned executed the release previously described. The defendant Shoemaker was manager of the aluminum reduction plant during the period subsequent to May, 1, 1957.

The court's findings include the following paragraphs: "II. Plaintiffs' claim in this case is for alleged injury and damage based upon conduct of defendants occurring subsequent to the date of said release. III. At the time said release was executed there was no damage to plaintiffs certain to result in the future from defendant's actions."

We are unable to find anything in the record to support or warrant either of these findings. The only evidence contained in the record consists of a deposition of I. B. Wand, (evidently a discovery deposition), taken by defendants on November 6, 1959, and three other depositions of I. B. Wand, (referred to in one of them as Ignatius Bernard Wand), taken in what must have been earlier litigation, as these are dated October 8, 1948, March 22, 1950, and April 16, 1954. Apparently these last three were introduced as defendants' exhibits, perhaps for the purpose of establishing certain admissions on the part of I. B. Wand.²

In the deposition first mentioned, that is, the one taken in the present case, Wand testified that he had to discontinue his operations; that his partner Alex quit in 1953, his brother George quit in 1954, and he himself liquidated his operations in 1956; this he said was because his crops were doing "worse every year". He attributed his poor crops to "nematodes" and these in turn to a "fluorine" condition, this evidently referring to the deposit of gases, etc., from the plant. He told about his plantings and acreages in 1954, 1955, and 1956; that the fluorine made the bulbs smaller than otherwise, and caused some leaf browning; that he grew no bulbs in 1957. He computed his damages on the basis of what he might earn growing bulbs, stating that such earnings should be from $10,000 to $12,000 a year.

The pretrial order, in reciting the plaintiffs' contentions, states: "Plaintiff contends: (a) Defendant Henry W. Shoemaker, in the direction, supervision, and control of the operation of the said plant, committed the acts herein complained of from May 1, 1957, until the present, and such acts were authorized, directed and ratified and approved by defendant Reynolds Metals Company. (b) Since May 1, 1957, until the present, defendants have repeatedly invaded plaintiffs' property by depositing thereon the said gases, fumes and particulates." There is no evidence whatever as to what, if anything, the defendants actually did in the way of maintaining a nuisance, or otherwise, during the period beginning May 1, 1957, up until July 18, 1957, the date on which the release was executed.³

It is plain that if on May 1, 1957, the defendants began carrying on their operations in such manner as to create a nuisance, then a cause of action in I. B. Wand for the nuisance would immediately rise, and he could recover, had he filed a complaint on July 18, 1957, for damages up to that date. Without any question whatever, the release of July 18, 1957, would be a release of all claims of that kind. But the acts of the defendants following May 1, 1957, and continuing to July 18, 1957, might well give rise to a claim for much larger damages.

If the facts show that the nuisance created immediately following May 1, 1957, was one likely to continue indefinitely, and if it arose from an operation which would not be enjoined, then there would arise in I. B. Wand an immediate right to recover not only for past but for prospective invasions of his land. The rule applied in such cases is stated in the Restatement of the Law of Torts, Sec. 930. This section, together with the Restatement's illustration of its operation is set forth in the margin.⁴

The question is whether the defendants' plant as of May 1, 1957, in sending forth gases and fumes, was doing so as an incident to the use of the plant, in a manner not avoidable by reasonable effort or expense, and hence the conditions created were likely to continue. The court might well...