O. S. Stapley Co. v. Miller

• Decision Date: 20 November 1968
• Docket Number: No. 9100--PR,9100--PR
• Citation: 103 Ariz. 556,447 P.2d 248
• Parties: O. S. STAPLEY COMPANY, an Arizona corporation, Seth Smith Boat Works, Inc., an Arizona corporation, American Chain and Cable Company, a New York corporation, Appellants and Cross-Appellees, v. Elizabeth (Hartzell) MILLER, a/k/a Elizabeth Miller Proulx, Appellee and Cross-Appellant, and O. S. Stapley Company, an Arizona corporation, Seth Smith Boat Works, Inc., an Arizona corporation, American Chain and Cable Company, a New York corporation, Appelles and Cross-Appellants.
• Court: Arizona Supreme Court

Page 248

447 P.2d 248

103 Ariz. 556

O. S. STAPLEY COMPANY, an Arizona corporation, Seth Smith Boat Works, Inc., an Arizona corporation, American Chain and Cable Company, a New York corporation, Appellants and Cross-Appellees, v. Elizabeth (Hartzell) MILLER, a/k/a Elizabeth Miller Proulx, Appellee and Cross-Appellant, and O. S. Stapley Company, an Arizona corporation, Seth Smith Boat Works, Inc., an Arizona corporation, American Chain and Cable Company, a New York corporation, Appelles and Cross-Appellants.

No. 9100--PR.

Supreme Court of Arizona, In Banc.

Nov. 20, 1968.

Moore, Romley, Kaplan, Robbins & Green, by Robert H. Green, Kenneth J. Sherk, Phoenix, for Seth Smith Boat Works, Inc.

Snell & Wilmer, by Roger W. Perry, Arthur P. Greenfield, Phoenix, for O. S. Stapley Co.

Fennemore, Craig, vonAmmon, McClennen & Udall, by Linwood Perkins, Jr., Phoenix, for American Chain and Cable Co.

Langerman, Begam & Lewis by Samuel Langerman, Robert D. Myers, Phoenix, for Elizabeth Miller Proulx.

John J. Dickinson, Phoenix, for amicus curiae, The American Trial Lawyers Ass'n.

LOCKWOOD, Justice:

On August 22, 1960, the plaintiff, Elizabeth (Hartzell) Miller, accompanied one Harry Hartzell and others to Canyon Lake in Arizona for the purpose of water sking. After arriving at the lake, the boat was operated for approximately an hour without incident. At the time of the accident, Hartzell and another member of the party were being pulled by the boat while they water-skied. Plaintiff was 'observer' and was sitting on the dash of the boat facing the skiers so that she might inform the boat operator as to what the skiers were doing. The driver of the boat at that time, one Villalpondo, felt that the plaintiff was not sitting in a safe position and asked her not to sit on the dash board. Plaintiff however, was holding on to a tubular rail which ran along the deck and felt that she was in a safe position. While proceeding straight ahead at approximately twenty-five miles per hour, the boat suddenly veered sharply throwing the plaintiff into the water and causing the propellor of the outboard motor to strike her right foot, inflicting serious damage.

The plaintiff based her claim on the alleged faulty steering system of the boat and brought suit against Villalpondo, (the operator of the boat), the O. W. Stapley Company, (retailers and installers of the boat's steering system), the Seth Smith Boat Works, Inc., (intermediate sellers of the steering system), and American Chain and Cable Company, (manufacturers of the steering system). The claim against Villalpondo was dismissed at the beginning of the trial.

Plaintiff contended that the cause of the accident and of her injuries was the apparent failure of a part of the steering system called the 'quick disconnect'. After the evidence was presented, the trial judge ruled, over defendants' objections, that the issue of contributory negligence would not be submitted to the jury. The court directed a verdict on the issue of negligence against the plaintiff and in favor of O. S. Stapley and Seth Smith Boat Works. The court also directed verdicts for the plaintiff on the issue of strict tort liability against O. S. Stapley, Seth Smith Boat Works, Inc. and American Chain and Cable Company. O. S. Stapley had cross-claimed for indemnity against Seth Smith, and both O. S. Stapley and Seth Smith had cross-claimed for indemnity against American Chain. The court directed verdicts in favor of the cross-claimants. After the jury verdict the court sustained American Chain's objection to the statement of costs filed by Seth Smith and O. S. Stapley and American Chain. All the parties appealed, and plaintiff filed a 'Conditional Cross-Appeal' on the issue of negligence.

Harry Hartzell purchased his boat and outboard motor for the purpose of water skiing from the O. S. Stapley Company in Chandler, Arizona. Hartzell placed his order with the manager and it was agreed that a seventy-five horsepower outboard motor and the steering system would be installed on the boat by the manager with some assistance from Hartzell himself. The seventy-five horsepower outboard motor was a new motor on the market and the American Chain and Cable Company had not yet manufactured a 'SteerMaster' steering system capable of use with the higher powered machine. The 'SteerMaster' kit to be used on the Hartzell boat was originally designed and manufactured for a thirty-five horsepower or fifty horsepower motor. Thus, to facilitate the increased horsepower, it became necessary to alter the 'SteerMaster' kit.

After the steering system was installed the boat was delivered to Hartzell. Before Hartzell took possession of the craft, American Chain came out with a new 'SteerMaster' kit for a seventy-five horsepower motor such as Hartzell was using. Even though Seth Smith was aware of the new kit and of Hartzell's situation, Hartzell was not informed of its availability.

The boat was used regularly over a period of weeks until the time of the accident. Hartzell testified that on the day of the accident he engaged the parts of the 'quick disconnect' after the boat was launched. The boat was then operated with and without skiers for about one hour before the mishap took place. Immediately after the accident occurred and the plaintiff was brought back on board, Hartzell observed that the two units of the 'quick disconnect' were separated. There was apparently no visible damage to the 'quick disconnect'. When the 'quick disconnect' is disengaged, it is impossible to control the direction of the boat from the driver's seat. This is because the 'quick disconnect' is a necessary link between the steering wheel and the motor (with the motor serving as both a source of power and as the rudder). The purpose of the 'quick disconnect' is to provide a method of separating the motor from the steering system such as when the motor is titled into a carrying or trailering position or when the motor is removed from the boat. To separate the ball stud of the 'quick disconnect' from the socket portion of the unit, the 'quick disconnect' is designed with a retracting spring lock sleeve which surrounds the socket. By retracting this sleeve the ball stud is removed from the cavity in which it rests. The evidence produced at trial indicated that as the 'SteerMaster' was constructed, if a sufficient vertical force was applied to the socket part of the 'quick disconnect' (viz. by the bridle, pulley or tow rope coming in contact with the 'quick disconnect', or by interference or binding of certain parts of the motor or steering assembly), the 'quick disconnect' could be quickly disconnected.

One of the main issues raised by the parties to this action was whether or not the doctrine of 'Products Liability' or 'Strict Tort Liability' applies in Arizona. In the recent case of Shannon v. Butler Homes, Inc. 102 Ariz. 312, 428 P.2d 990 (1967) we stated:

'The liability of a manufacturer of an article is in tort (see Phillips v. Anchor Hocking Glass Corp., 100 Ariz. 251, 413 P.2d 732, and concurring opinion of Justice Lockwood in Nalbandian v. Byron Jackson Pumps, 97 Ariz. 280, 399 P.2d 681), and it is not assumed by agreement but imposed by law. Crystal Coca-Cola Bottling Co. v. Cathey, 83 Ariz. 163, 317 P.2d 1094.' 102 Ariz. at 315, 428 P.2d at 993.

The concurring opinion in the 1965 case of Nalbandian stated in part:

'In the recent case of Colvin v. Superior Equipment Company, 96 Ariz. 113, 392 P.2d 778 (1964), this Court adopted the modern legal concept of a manufacturer's strict liability in tort with regard to its manufactured products.' 97 Ariz. at 287, 399 P.2d at 686.

The American Law Institute's Restatement of the Law of Torts, (Second), (1965) states in § 402 A:

'(1) One who sells any product in a defective condition unreasonably dangerous to the user or consumer or to his property is subject to liability for physical harm thereby caused to the ultimate user or consumer, or to his property, if

'(a) the seller is engaged in the business of selling such a product, and

'(b) it is expected to and does reach the user or consumer without substantial change in the condition in which it is sold.

'(2) The rule stated in Subsection (1) applies although

'(a) the seller has exercised all possible care in the preparation and sale of his product, and

'(b) the user or consumer has not bought the product from or entered into any contractual relation with the seller.'

Comments c, d, j, 1 and p state:

'c. On whatever theory, the justification for the strict liability has been said to be that the seller, by marketing his product for use and consumption, has undertaken and assumed a special responsibility toward any member of the consuming public who may be injured by it; that the public has the right to and does expect, in the case of products which it needs and for which it is forced to rely upon the seller, that reputable sellers will stand behind their goods; that public policy demands that the burden of accidental injuries caused by products intended for consumption be placed upon those who market them, and be treated as a cost of production against which liability...