State Farm Fire & Cas. Co. v. Kupanoff Imports, Inc., 13-92-2

• Decision Date: 20 October 1992
• Docket Number: No. 13-92-2,13-92-2
• Citation: 83 Ohio App.3d 278,614 N.E.2d 1072
• Parties: STATE FARM FIRE & CASUALTY COMPANY et al., Appellants, v. KUPANOFF IMPORTS, INC.; Fostoria Power Equipment Company et al., Appellees.
• Court: Ohio Court of Appeals

Page 278

83 Ohio App.3d 278

614 N.E.2d 1072

STATE FARM FIRE & CASUALTY COMPANY et al., Appellants, v. KUPANOFF IMPORTS, INC.; Fostoria Power Equipment Company et al., Appellees.

No. 13-92-2.

Court of Appeals of Ohio, Third District, Seneca County.

Decided Oct. 20, 1992.

Williams, Jilek, Lafferty & Gallagher Co., L.P.A., and Drew R. Masse; Manahan, Pietrykowski, Bamman & Delaney and Ted B. Riley, Toledo, for appellants.

Eastman & Smith and David F. Cooper, Toledo, for appellee Fostoria Power Equipment Company.

Meyers, Hentemann, Schneider & Rea Co., L.P.A., and Thomas L. Brunn, Cleveland, for appellees Drew Nat. Corp. and Fujitsu General, Ltd.

Tomb & Hering and Brent T. Howard, Tiffin, for appellee Doyle Distributing Co.

HADLEY, Presiding Judge.

Plaintiffs-appellants, State Farm Fire & Casualty Company, Lawrence Beckman, and Betty Beckman ("appellants"), appeal from a judgment in the Seneca County Court of Common Pleas which granted summary judgment to defendants-appellees, Fostoria Power Equipment Company ("FPE") and Doyle Distributing Company ("Doyle"). Such judgment also rendered moot Doyle's third- and fourth-party complaints for indemnification and contribution against third-party defendants-appellees, Fujitsu General, Ltd. ("Fujitsu") and Drew National Corporation ("Drew").

Appellants originally filed a complaint for damages sustained to the Beckmans' residence as a result of a fire in 1988. Their complaint sought damages from FPE, Handy Manufacturing Company, d.b.a. Western Manufacturing Corporation ("Handy"), Kupanoff Imports, Inc., d.b.a. Kupanoff & Associates, Inc. ("Kupanoff"), and a John Doe corporation. The basis of their product liability action was that the fire to their home was caused by a defective Heatmate model 700 kerosene heater. Service was never perfected on Kupanoff and Handy was voluntarily dismissed as a party in 1990.

In May 1990, FPE filed a third-party complaint seeking indemnification and contribution from Doyle, the distributor of the kerosene heater. Appellants never amended their complaint to include Doyle as a party defendant. In September 1990, Doyle filed third-party and fourth-party complaints against Fujitsu and Drew, the manufacturer and importer, respectively, of the kerosene heater. Service on Fujitsu, a Japanese company, was perfected in accordance with the Hague Convention. Appellants never amended their complaint to include Fujitsu, the manufacturer, as a party defendant.

Motions for summary judgment were filed by Doyle and FPE against appellants based on R.C. 2307.78(A). The trial court found, as a matter of law, that FPE and Doyle were not negligent on the basis of R.C. 2307.78(A). The trial court also addressed appellants' argument that Doyle and FPE could be liable under additional provisions of R.C. Chapter 2307 if the manufacturer (Fujitsu) was not subject to judicial process in Ohio, pursuant to R.C. 2307.78(B). The trial court similarly rejected that argument, finding that it had personal jurisdiction over Fujitsu. Therefore, the trial court granted summary judgment for Doyle and FPE, and dismissed Doyle's third-party complaint against Fujitsu. It is from this judgment that appellants assert one assignment of error:

"The trial court erred in granting defendant Fostoria Power Equipment Company's motion for summary judgment."

Appellants argue that FPE and Doyle should not have been dismissed as they are still subject to possible liability under R.C. 2307.71 through 2307.77 because Fujitsu is not subject to judicial process in Ohio. This argument is based upon a reading of R.C. 2307.78, which states in relevant part:

"(A) Subject to division (B) of this section, a supplier is subject to liability for compensatory damages based on a product liability claim only if the claimant establishes, by a preponderance of the evidence, that either of the following applies:

"(1) The supplier in question was negligent and that negligence was a proximate cause of harm for which the claimant seeks to recover compensatory damages;

"(2) The product in question did not conform, when it left the control of the supplier in question, to a representation made by that supplier, and that representation and the failure to conform to it were a proximate cause of harm for which the claimant seeks to recover compensatory damages. * * *

"(B) A supplier of a product is subject to liability for compensatory damages based on a product liability claim under sections 2307.71 to 2307.77 of the Revised Code, as if it were the manufacturer of that product, if the manufacturer of that product is or would be subject to liability for compensatory damages based on a product liability claim under sections 2307.71 to 2307.77 of the Revised Code and any of the following applies:

"(1) The manufacturer of that product is not subject to judicial process in this state[.]"

Thus, appellants hope to attach liability to Doyle and FPE by virtue of R.C. 2307.78(B)(1), since the trial court found as a matter of law, and appellants do not now dispute, that liability will not attach by virtue of R.C. 2307.78(A). R.C. 2307.78(B) permits a plaintiff to seek compensatory damages from a supplier ¹ if the manufacturer is subject to liability under R.C. 2307.71 through 2307.77 and the manufacturer is not subject to "judicial process" in this state.

Therefore, the ultimate question is whether the manufacturer in the matter sub judice, Fujitsu, is subject to judicial process in this state. As we read this section and for purposes of this appeal only, "judicial process" refers to personal jurisdiction and whether the trial court ...