Stauffer Chemical Co. v. Curry

Decision Date28 July 1989
Docket Number88-85,Nos. 88-84,s. 88-84
Citation778 P.2d 1083
Parties10 UCC Rep.Serv.2d 342 STAUFFER CHEMICAL COMPANY, a corporation, Appellant (Defendant), v. Robert CURRY and Chuck Curry, d/b/a Diamond Ring Farms, Appellees (Plaintiffs). Robert CURRY and Chuck Curry, d/b/a Diamond Ring Farms, Appellants (Plaintiffs), v. STAUFFER CHEMICAL COMPANY, a corporation, Appellee (Defendant).
CourtWyoming Supreme Court

Cameron S. Walker and Judith A. Studer, Schwartz, Bon, McCrary & Walker, Casper, for Stauffer.

Donald E. Jones, Jones & Graham, Torrington, for Currys.

THOMAS, Justice.

This appeal is taken from a jury verdict awarding damages for breach of express and implied warranties to the operators of a farming enterprise because of the inefficacy of an insecticide to control western corn rootworms. The primary issues in the appeal by Stauffer Chemical Company (Stauffer) arise from rulings of law made by the trial court with respect to Stauffer's attempts to exclude and limit warranties and from rulings during trial with respect to the admissibility of certain evidence and the scope of cross-examination that Stauffer asserts interfered with the presentation of its theory of the case and its right to a fair trial. Other issues are presented relating to the denial of Stauffer's motion for a directed verdict; the instructions given to the jury; and the award of certain items as costs. In a cross-appeal, Robert and Chuck Curry, who had done business under the name of Diamond Ring Farms (Currys), assert error with respect to a summary judgment ruling that limited their claims of consequential damages to the loss in value of the 1985 corn crop and related lost profits in their cattle operations following the failure of that crop. Our review of the record in this case discloses no reversible error as to any of the issues presented by the parties. We affirm the judgment of the district court in all respects.

In its appeal, Stauffer asserts the following issues:

"1. Did the District Court err in failing to give effect to the warranty exclusion and limitation of liability printed on the Dyfonate 20-G bag and similar language appearing in promotional literature?

"2. Did the District Court err in restricting the development of defendant's theory of the case by:

"a. Admitting testimony from plaintiffs' marginally qualified experts and then unduly restricting cross-examination;

"b. curtailing defendant's expert testimony on the same issues; and

"c. refusing relevant evidence of corn rootworm test plots and testimony referring thereto?

"3. Did the District Court err in failing to grant defendant's motions for a directed verdict?

"4. Did the District Court err in its jury instructions?

"5. Did the court err in imposing certain costs?"

The Currys make the following statement with respect to the questions presented by the primary appeal:

"Without detracting from appellant's issues which it asks the court to address, appellees would suggest that--

"(1) Appellant's Issue 2 be rewritten to ask:

"2. Did the trial court abuse its discretion in limiting the testimony of expert witnesses as to observations, test data and ratings of corn plants, which evidence was remote in time and place from Curry's 1985 damaged corn fields, with no offer by foundation of comparable controlling conditions?

"(2) The following issues be added:

"A. Did appellant waive its disclaimer of warranty and limitation of damages defense by stating to the jury in closing argument that it would not invoke the disclaimer language on its label?

"B. Did appellant waive its right to now contest the general verdict form for failure to object at trial?"

In their appeal, the Currys assert only one issue:

"Did the lower court err in granting summary judgment to prevent damage claims on lost profits, cessation of business, interest and cost of the product from going to the jury?"

Stauffer restates the issue in the Curry's appeal in this way:

"Did the Court err in granting partial summary judgment limiting plaintiffs' damages to the difference in value of their 1985 crop and attendant lost profits in their cattle operations related to the 1985 crop loss, and dismissing damage claims for prejudgment interest, purchase price of the product, loss of the farm, and future lost profits for 1987 and years following?"

Prior to, and continuing through, the events that culminated in this action, Robert and Chuck Curry ran a farming, livestock raising, and custom cattle feeding enterprise as a father and son partnership under the business name of Diamond Ring Farms. They conducted these operations in the area of Veteran in Goshen County. The "farming unit" consisted of two separate farms, one that had been in the family since 1947 and one that was acquired and incorporated into the enterprise in 1969.

The soil in the area historically had been high in pH levels (indicating alkalinity), and this was true of the two Curry farms. This soil characteristic causes stalks and leaves of most corn plants grown in such soils to manifest a "chlorotic" or "yellowing" appearance. The record indicates that this appearance is attributable to a lack of iron reaching the stalks and leaves of the corn plants. Adequate iron is essential to the proper growth and production of corn.

In 1983, the Currys made a significant change in their farming methods. Prior to that time, they had followed a system of crop rotation pursuant to which different crops were raised on various segments of their land every year. Diabrotica Virgifera LeConte, generically known as western corn rootworms, were not a problem under the crop rotation practice because the rotation of crops disrupted the life cycle of the worms, which were unable to thrive because they need corn roots for nutrition. The shift in 1983 was from the rotation farming to a system pursuant to which the Currys would grow nothing but corn and alfalfa. The new crop scheme that was implemented with respect to both farms included a plan to grow irrigated "ear" corn repeatedly on the same acreage. In predetermined percentages, some of the corn was to be picked whole for feed and sale, and the balance would be turned into silage by mulching the entire plant. The new farming method was a radical departure from the prior method, and it did entail risks and problems not encountered previously. One of the most significant of the new risks was that the corn rootworm cycle could now be complete because of the continuity of corn crops on the same tracts of land. From this time on, rootworm infestation constituted a major problem.

At the same time, the Currys shifted to a different method of soil preparation for planting. Previously, they had plowed their land with folding of the residue, or "trash," from the prior year's crop back into the ground. In 1983, they began to prepare their soil by a simpler method known as minimum till farming (also called conservation tillage). Farmers using this method simply disc and subsoil the ground. This process does not fold the prior year's crop residue into the ground, but leaves it on the surface instead. The effect of this change was to compound the corn rootworm problem because the "trash" on the surface creates a troublesome condition providing a fertile breeding ground for harmful insects, including the western corn rootworm. The mass of the surface residue also makes it more difficult for applied insecticide to penetrate through the surface and into the roots where it must be present in order to be effective.

In relation to one element of damages, it is important to recognize that, in 1983, the Currys also converted their livestock operation into a different endeavor in which they purchased calves in the fall, wintered them on the feed provided by the farming operation from the previous growing season, grazed them during the summer, and then marketed the yearlings in the fall. The plan assumed that this cycle would repeat each year with the revenue from the sale of the yearlings used to buy the next crop of calves. The Currys were working on a slim margin, like most farmers during these years, and they could not achieve any profit by purchasing feed for the winter from outside sources. The success of their own corn crop was essential in the livestock operation. Currys knew that, if their corn crop should fail in any year, the livestock raising and sales operation also would fail in that year. The Currys' custom cattle feeding service was also dependent on their corn crop. Unless they were able to raise corn in excess of the demands of their own livestock operation, it would not be possible for them to feed cattle for other ranchers at a profit.

The Currys recognized the possible effect of western corn rootworm damage when they instituted the change in their operations, and they sought an effective insecticide to protect their corn crop. In the 1983 season, they selected Dyfonate 20-G (Dyfonate), a product manufactured by Stauffer. One of the reasons for this selection over competing products was the Currys' belief, which was consistent with promotional literature distributed by Stauffer, that Dyfonate would seep down readily through corn "trash" and high pH soil and still be effective upon reaching the roots of the corn plants. Other manufacturers did not claim this same advantage.

In 1983, the Dyfonate seemed to work well and to control the western corn rootworms. In 1984, the Currys again selected Dyfonate, applied it, and it, again, was effective to protect the corn crop. In both years, the crops were healthy and productive. Consistently, the Currys again used Dyfonate in 1985, but the results were markedly different that year. About the middle of July, the corn seemed to stop growing, became chlorotic, and it began to lean or "lodge" as the condition is described in farming terminology. Virtually all of the plants manifested heavy corn rootworm infestation and severe root pruning by...

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