Shepard v. Alexian Brothers Hosp.

• Decision Date: 24 July 1973
• Citation: 109 Cal.Rptr. 132,33 Cal.App.3d 606
• Court: California Court of Appeals Court of Appeals
• Parties: , 12 UCC Rep.Serv. 1030 Ronald SHEPARD, etc., Plaintiff and Appellant, v. ALEXIAN BROTHERS HOSPITAL, INC., Defendant and Respondent. Civ. 30322.

Page 132

109 Cal.Rptr. 132

33 Cal.App.3d 606, 12 UCC Rep.Serv. 1030

Ronald SHEPARD, etc., Plaintiff and Appellant, v. ALEXIAN BROTHERS HOSPITAL, INC., Defendant and Respondent.

Civ. 30322.

Court of Appeal, First District, Division 2, California.

July 24, 1973.

Collins, Hays, Stewart, Berg, Pott & Sanford, Inc., David H. Doud, San Jose, for plaintiff and appellant.

Wines, Coffee & Robinson, Charles H. Kavalaris, Paul H. Coffee, San Jose, for defendant and respondent.

KANE, Associate Justice.

Plaintiff Ronald Shepard appeals from a judgment of dismissal entered after respondent's demurrers to the complaint and amendment to complaint were sustained without leave to amend.

In his pleadings appellant alleges that he contracted serum hepatitis by reason of a blood transfusion administered to him while he was a patient in respondent hospital.

Asserting that the blood was contaminated with hepatitis virus, appellant sought recovery on alternative theories of strict liability in tort, breach of express and implied warranties, and negligence. ¹

Strict Liability In Tort

In California a cause of action for strict liability in tort can be stated under two tests. The first test, laid down in Greenman v. Yuba Power Products, Inc. (1963) 59 Cal.2d 57, 62, 27 Cal.Rptr. 697, 700, 377 P.2d 897, 900, holds that 'A manufacturer is strictly liable in tort when An article he places on the market, knowing that it is to be used without inspection for defects, proves to have a defect that causes injury to a human being.' (Emphasis added.) The second test is contained in Restatement Second of Torts, section 402A, and provides that '(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.' (Emphasis added.)

As it appears, the two tests are not coextensive. While the Restatement rule requires a sale of the defective product by a seller who is engaged in the business of selling and covers only the user or consumer, the Greenman rule is much broader and imposes strict liability in tort whenever a defective article Placed on the market causes injury to a human being. Nevertheless, there is a common denominator in both rules, namely, the requirement of a Defective product which, when placed in the stream of commerce, causes injury.

Before examining whether, in light of the foregoing tests, appellant stated a cause of action under strict liability in tort, we ought to emphasize that, appellant's contention notwithstanding, the question to be decided here is not simply whether human blood is or can be designated as a product under a general definition (cf. Rest.2d Torts, § 402A, Comment e; Cunningham v. MacNeal Memorial Hospital (1970), 47 Ill.2d 443, 266 N.E.2d 897. Rather, to the contrary, the precise issue is whether or not the Blood transfusion, the alleged cause of appellant's injury, constitutes a cause of action under the doctrine of strict liability, either because it qualifies as a product and/or a sale.

In answering this question we need not speculate or make deductions from rules of general applicability. The California Legislature, by statutory enactment, has expressed its intent and declared a clear legal policy that the transfusion of blood and blood product into the human body shall be construed for All purposes to be the rendition of a service and not a sale. Thus, Health and Safety Code, ² section 1606 provides that 'The procurement, processing, Distribution, or use of whole blood, plasma, blood products, and blood derivatives For the purpose of injecting or Transfusing the same, or any of them, Into the human body shall be construed to be, and is declared to be, for all purposes whatsoever, the rendition of a service by each and every person, firm, or corporation participating therein, And shall not be construed to be, and is declared not to be, a sale of such whole blood, plasma, blood products, or blood derivatives, for any purpose or purposes whatsoever.' (Emphasis added.)

To underline the legislative intent that a blood transfusion must be considered to be a service even if a sale takes place, section 1600 makes it explicit that the statutory phrase 'distribution' includes sale and exchange (§ 1600.4).

As appellant aptly notes, the rationale behind section 1606 is expressed in Perlmutter v. Beth David Hospital (1954), 308 N.Y. 100, 123 N.E.2d 792, which served as the inspiration for the California Legislature in enacting section 1623 (the predecessor of § 1606) in 1955. In Perlmutter, the New York court laboriously analyzed the nature of hospital treatment and concluded that the supplying of blood by a hospital to a patient is merely incidental to the services rendered, and cannot, therefore, be considered as a sale. Accordingly, the court held that where no negligence or fault is present, the hospital is not liable to a patient who becomes infected with serum hepatitis as a result of a blood transfusion.

In sum, since section 1606 and its underlying rationale compel the conclusion that a blood transfusion must be regarded as a service, the doctrine of strict liability in tort is inapplicable as a matter of law.

Appellant, however, asks us to extend the doctrine to services. He bases his argument on the broad policy principles enunciated in some cases and voiced by some authorities, and on the salient fact that in a series of cases the doctrine has been extended to a number of non-sale transactions as well.

In justifying the imposition of strict liability the courts have frequently stressed that their purpose it to insure that the cost of injuries resulting from Defective products are borne by the manufacturers who Put such products on the market rather than by the injured persons who are powerless to protect themselves (Greenman v. Yuba Power Products, Inc., supra, 59 Cal.2d at p. 63, 27 Cal.Rptr. 697, 377 P.2d 897; Price v. Shell Oil Co. (1970), 2 Cal.3d 245, 251, 85 Cal.Rptr. 178, 466 P.2d 722). As additional reasons for imposing such liability, it has also been said that the defendant Profits from such transactions and is in a good strategic position either to protect himself by making inquiry and proper tests, or To promote safety through presure on his supplier, or by using another product which is not defective. As a general proposition, it has been further suggested that the risk of injury can be insured by the manufacturer and distributed among the public as a cost of doing business (Price v. Shell Oil Co., supra at p. 251, 85 Cal.Rptr. 178, 466 P.2d 722; Vandermark v. Ford Motor Co. (1964) 61 Cal.2d 256, 262--263, 37 Cal.Rptr. 896, 391 P.2d 168; Seely v. White Motor Co. (1965) 63 Cal.2d 9, 18--19, 45 Cal.Rptr. 17, 403 P.2d 145; Escola v. Coca Cola Bottling Co. (1944) 24 Cal.2d 453, 462, 150 P.2d 436; Newmark v. Gimbel's Incorporated (1968) 102 N.J.Super. 279, 246 A.2d 11, 15--16). It is quite apparent, however, that none of these reasons apply to a hospital which, during the care and treatment of a patient, administers a blood transfusion.

As indicated before, profound justification exists for the Legislature to determine that a blood transfusion, provided in the course of treatment, should be considered a service rather than a product or sale. It needs no extended discussion to perceive that a hospital is primarily devoted to the care and healing of the sick. The supplying of blood by the hospital is entirely subordinate to its paramount function of furnishing trained personnel and specialized facilities in an endeavor to restore the patient's health. Providing medicine or supplying blood is simply a chemical aid or instrument utilized to accomplish the objective of cure or treatment. The patient who enters a hospital goes there not to buy medicines or pills, not to purchase bandages, iodine, serum or blood, but to obtain a course of treatment (Perlmutter v. Beth David Hospital, supra, 123 N.E.2d at pp. 795--796; Silverhart v. Mount Zion Hospital (1971) 20 Cal.App.3d 1022, 1027, 98 Cal.Rptr. 187). It is also obvious that in the normal commercial transaction contemplated in the strict liability cases the essence of the transaction relates Solely to the article sold, the seller is in the business of supplying the product to the consumer and it is that, and that alone for which he is paid (Magrine v. Spector (1968) 100 N.J.Super. 223, 241 A.2d 637). The foregoing marked distinctions compel the conclusion that A hospital is not engaged in the business of distributing blood to the public and Does not put the blood as a product on the market in order to profit therefrom.

Additional policy considerations also militate against the imposition of strict liability in the situation here presented. Thus it is widely recognized that despite every effort to screen donors, the possibility that hepatitis virus may be present in the dried plasma cannot be completely obviated. Moreover, if the virus is present, it cannot be discovered by microscopic examination or by any other test known to medical science (McDaniel v. Baptist Memorial Hospital (6 Cir. 1972) 469 F.2d 230, 234; Merck & Co. v. Kidd (1957) 242 F.2d 592; see also: A New Principle of Products Liability in Service Transactions, 30 U. of Pittsburgh L.Rev. (1969) 508, 515). Since in the present stage of medical science the hepatitis virus seems to be virtually undetectable, ³ the Imposition of strict...