Scordino v. Hopeman Bros., Inc.

• Decision Date: 12 October 1995
• Docket Number: No. 91-CA-01053-SCT,91-CA-01053-SCT
• Citation: 662 So.2d 640
• Parties: Prod.Liab.Rep. (CCH) P 14,490 Philip SCORDINO and Dwight Copeland, et al. v. HOPEMAN BROTHERS, INC.
• Court: Mississippi Supreme Court

Page 640

662 So.2d 640

Prod.Liab.Rep. (CCH) P 14,490

Philip SCORDINO and Dwight Copeland, et al. v. HOPEMAN BROTHERS, INC.

No. 91-CA-01053-SCT.

Supreme Court of Mississippi.

Oct. 12, 1995.

Lowry M. Lomax, F. Gerald Maples, Maples & Lomax, Pascagoula, for Appellant.

Suzanne N. Saunders, Rebecca L. Wiggins, Saunders & Wiggins, Jackson, for Appellee.

Before HAWKINS, C.J., and PITTMAN and BANKS, JJ.

BANKS, Justice, for the Court:

In this case, we are called upon to determine whether a joiner subcontractor, in the business of installing shipboard furniture, beds, box berthing, non-structural bulkheads, overheads, installation, etc., is strictly liable or negligent as a manufacturer or a seller under Section 402A of the Restatement Second of Torts for installing and supplying asbestos paneling as required under the subcontract. We conclude that the subcontractor in this case was not a manufacturer or a seller and therefore is not strictly liable, or liable under the theory of negligence, for failure to warn.

I.

In their complaint, the Plaintiffs, Appellants herein, former employees of Ingalls Shipyard Corporation, alleged that while employed at Ingalls, they were exposed to asbestos, a fibrous, incombustible, chemical-resistant mineral, in the form of Marinite and Micarta, a fire-resistant wall paneling supplied and installed by Hopeman Brothers, Inc. The Plaintiffs claimed that irreparable and progressive lung damage was caused due to being exposed to the dust generated by the installation of the paneling, and that during this exposure period, they had no reason to believe or otherwise had knowledge that the Marinite was dangerous when inhaled or otherwise ingested. The Plaintiffs alleged that Hopeman, among others, knew or should have known about the dangers of asbestos and failed to warn the Plaintiffs about said dangers by ignoring or actively and fraudulently concealing the danger. Thus, the Plaintiffs alleged that Hopeman was negligent and strictly liable for its conduct which resulted in the aforementioned injuries. In response, Hopeman claimed that because it was a installer and not a seller or manufacturer of asbestos, it was not liable for negligence or under strict liability.

At trial, following the testimony of witnesses for the Plaintiffs and Hopeman, Hopeman moved for a directed verdict which was granted by the trial court. The trial court reasoned that the Micarta and Marinite installed by Hopeman was not Hopeman's product. Rather, the trial court concluded, Hopeman was "a subcontractor of labor to assemble and install various materials," pursuant to the subcontract which contained exact specifications.

This appeal ensued with the Plaintiffs claiming that the directed verdict was against the overwhelming weight of the evidence with regards to strict liability and negligence.

II.

A. Strict Liability.

In State Stove Manufacturing Co. v. Hodges, 189 So.2d 113 (Miss.1966), cert. denied 386 U.S. 912, 87 S.Ct. 860, 17 L.Ed.2d 784 (1967), this Court adopted the doctrine of strict liability under Section 402A of the American Law Institute's Restatement of Torts (Second). Section 402A states:

Special Liability of Seller of Product for Physical Harm to User or Consumer--

(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 condition in which it is sold

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

(a) the seller 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.

State Stove Manufacturing, 189 So.2d at 118, citing Restatement of Torts (Second) § 402A (1965). See also Coca-Cola Bottling Co., Inc. of Vicksburg v. Reeves, 486 So.2d 374, 378 (Miss.1986), citing William Cooper and Nephews, Inc. v. Pevey, 317 So.2d 406, 408 (Miss.1975); and Early-Gary, Inc. v. Walters, 294 So.2d 181, 186 (Miss.1974) ("... before recovery can be had under Section 402A, three elements must be established by proof:

(1) that the plaintiff was injured by the product, (2) that the injury resulted from a defect in the product which rendered it unreasonably dangerous, and (3) that the defect existed at the time it left the hands of the seller.").

The applicability of the strict liability doctrine depends upon, among other things, whether the defendant is a manufacturer or seller in the business of selling a defective product. Harmon v. National Automotive Parts Ass'n, 720 F.Supp. 79, 80 (N.D.Miss.1989) ("The statement of the rule makes it obvious that strict liability for injury caused by a defective product is not to be imposed on one who neither manufactures nor sells the products"); Restatement (Second) of Torts § 402A. Thus, resolution of this issue turns on the question of whether Hopeman is a manufacturer or a seller.

The term "seller" is defined as a person who sells or contracts to sell goods. Volkswagen of America, Inc. v. Novak, 418 So.2d 801, 804 (Miss.1982), citing Miss.Code Ann. § 75-2-103(1)(d) (1972); 67 Am.Jur.2d Sales § 16 (1985). Comment f of Restatement (Second) Section 402A further defines a seller as any person engaged in the business of selling products for use or consumption. It is not necessary that the seller be engaged solely in the business of selling a specific product; however, the seller must not be an occasional seller of the product. Restatement (Second) Torts, § 402A, Comment f. The question here then is what is an occasional seller and whether Hopeman, as a subcontractor, falls within this category.

This Court has not addressed the issue of whether a subcontractor is an occasional seller and consequently not subject to the provisions of Restatement (Second) of Torts, Section 402A. However, the Plaintiffs insist that State Stove Manufacturing Company v. Hodges, 189 So.2d 113 (Miss.1966), if not controlling, may provide some guidance.

In State Stove, an action was brought by owners of a home destroyed in a fire due to the explosion of a water heater against the manufacturer of the heater and the contractors who constructed the home and supplied and installed the water heater. State Stove Manufacturing Company v. Hodges, 189 So.2d 113 (Miss.1966). The chancery court dismissed the suit with prejudice against the contractors and both the homeowners and the manufacturer appealed. Id. On appeal, this Court reversed. This Court found that the contractors were engaged in the business of selling and installing water heaters in homes constructed by them and were therefore strictly liable for its faulty installation. Id. at 123-124. Although it is urged that this case stands for the proposition that contractors are sellers, the fact is that the contractors in State Stove, who installed the water heater improperly, were also the owners of the hardware store from whence the water heater was purchased. That is, they were in the chain of delivery of the product in a different capacity than a mere contractor and that capacity was, inarguably, a seller.

The Plaintiffs also maintain that Bounds v. Joslyn Manufacturing and Supply Company, 660 F.Supp. 1063 (Miss.1986), a Mississippi District Court case, may shed some light on this issue. In this case, the plaintiff was an employee of an cable construction company that had entered into a contract with a cable company to construct twenty-seven miles of cable system in Meridian, Mississippi. Bounds v. Joslyn Manufacturing and Supply Company, 660 F.Supp. 1063 (S.D.Miss.1986). Pursuant to the contract, the cable company supplied all the cable poles and other necessary hardware for the construction of the cable system from the defendant retailer. Id. Included among the necessary hardware was a guy strap which had been manufactured by the defendant supply company. Id. When the plaintiff subsequently used the guy strap in the manner for which it was intended, the guy strap broke and this suit ensued. Id. The court addressed the question of whether supplying equipment under the terms of a contract made the supplier a seller of that equipment, and if so, did the act of supplying that equipment rise to the level of conducting the "business of selling" as required under Restatement (Second) of Torts § 402A. Id. at 1066. The court concluded:

The Mississippi Supreme Court would, in all probability, take the position that an employee may sue one who contracts for services with his employer when, under the terms of the contract, he agrees to provide the necessary materials and supplies with which the employer's personnel must work. The employee needs to show for products liability purposes that the party that supplied the product to his employer furnishes materials in a contract arrangement on such a regular or consistent basis that the act of supplying products is a part of its business activity and not an occasional act.

Id. at 1068-1069. In reaching this conclusion, the court recognized that there is no Mississippi case which discusses whether a supplier of materials under the terms of a contract is engaged in the business of selling. In the absence of Mississippi case law, the court relied upon the following three federal cases: Bosse v. Litton Unit Handling Systems, Inc., 646 F.2d 689 (1st Cir.1981); Mitchell v. Shell Oil Company, 579 F.Supp. 1326 (D.Mont.1984); Walker v. Skyclimber, Inc., 571 F.Supp. 1176 (D.C.V.I.1983). None of these cases appear to support the District Court's conclusion. For example, in Bosse, the plaintiff's characterization of the general contractor as seller was never challenged, as it is in the instant case. Consequently, the issue of whether the...