Stewart v. Budget Rent-A-Car Corp.

• Decision Date: 26 May 1970
• Docket Number: No. 4858,A-C,RENT-A-CAR,4858
• Citation: 470 P.2d 240,52 Haw. 71
• Parties: Christina STEWART v. BUDGETCORPORATION, Budget Rent-ar of Hawaii, Royal Hawaiian Trading Co., Inc., and Isuzu Motors, Ltd.
• Court: Hawaii Supreme Court

Page 240

470 P.2d 240

52 Haw. 71

Christina STEWART v. BUDGET RENT-A-CAR CORPORATION, Budget Rent-A-Car of Hawaii,

Royal Hawaiian Trading Co., Inc., and Isuzu Motors, Ltd.

No. 4858.

Supreme Court of Hawai'i.

May 26, 1970.

Syllabus by the Court

1. One who sells or leases a defective product which is dangerous to the user or consumer or to his property is subject to liability for physical harm caused by the defective product to the ultimate user or consumer, or to his property, if (a) the seller or lessor is engaged in the business of selling or leasing such product, and (b) the product is expected to and does reach the user or consumer without substantial change in its condition after it is sold or leased.

2. In a tort action by the driver of an automobile involved in an accident, where there is no eye witness to the accident other than the driver who testified that the car became uncontrollable and where the only expert who testified was unable to form an opinion because of the damaged condition of the car and the subsequent changes in the car's condition, a directed verdict against the plaintiff is not justified as a matter of law.

3. Circumstantial evidence is admissible to establish the fact that there was a defect in an automobile and the fact that the defect caused an accident.

4. In a tort action by the driver of a leased automobile involved in an accident, where there was sufficient evidence of a defect in the automobile to go to the jury with respect to the liability of the automobile rental agency, there was likewise sufficient evidence of a defect to go to the jury with respect to the liability of the manufacturer and the distributor of the automobile.

Thomas M. Waddoups, Honolulu (Anthony & Waddoups, Honolulu, of counsel), for Budget Rent-A-Car of Hawaii, defendant-appelllant.

Ronald D. Libkuman, Honolulu (Libkuman, Shimabukuro & Ventura, Honolulu, of counsel) for Royal Hawaiian Trading Co., Inc., defendant-appellee.

Asa M. Akinaka, Honolulu (Padgett, Greeley, Marumoto & Akinaka, Honolulu, of counsel) for Isuzu Motors, Ltd., defendant-appellee.

Martin Anderson and David J. Dezzani, Honolulu (Jenks, Kidwell, Goodsill & Anderson, Honolulu, of counsel), for plaintiff-appellee.

Before RICHARDSON, C. J., ABE, LEVINSON and KOBAYASHI, JJ., and Circuit Judge LAURETA in place of MARUMOTO, J., disqualified.

LEVINSON, Justice.

The plaintiff was injured when her rented car went off the side of the road on the island of Hawaii. She brought suit against the rental agency, the distributor and the manufacturer of the car alleging breach of an implied warranty of fitness for the use intended. The rental agency cross-complained against the distributor and the manufacturer. The distributor in turn cross-complained against the manufacturer. After the court granted a directed verdict on behalf of the distributor and the manufacturer against the plaintiff's claim and the rental agency's cross-claim, the jury returned a verdict for the plaintiff against the rental agency in the sum of $90,500.00 and judgment was entered for that amount and costs.

The defendant rental agency appeals on the ground that not enough evidence was adduced by the plaintiff to prove that there was a defect in the automobile and that a defect was the cause of the accident. The rental agency further claims that the trial court improperly dismissed its cross-claim against the distributor and manufacturer of the allegedly defective car for want of proof of the defect when the car was in their control. We affirm the court's ruling that there was sufficient evidence of a defective automobile to go to the jury and reverse the court's ruling directing a verdict in favor of the manufacturer and distributor. All other specifications of error are dismissed as without merit.

During the course of the trial the plaintiff testified that on February 20, 1966 she was driving the defendant's rental car along a straight and level section of an asphalt, two lane road on a sunny day at 10:00 in the morning. She testified that the car began veering to the left and that she could not control this by using the steering wheel. Her immediate application of the brakes caused the car to 'jump or jerk' further to the left. The car then plunged off an embankment and overturned. The plaintiff was seriously injured. The relevant portion of her testimony is set out in the footnote below. ¹

The car, a 1966 Isuzu 'Bellett' which had been driven only 2829 miles, was towed to the nearest town where it was stored. The defendant rental agency half had the car cut in half. The front half was shipped from Hilo to Honolulu. The plaintiff's expert imspected the front half in Honolulu and subsequently flew to the place where the rear half was stored on the island of Hawaii. By that time the rear half had been partially 'cannibalized' as many parts, including a substantial portion of the rear brake assembly, had been removed and sold.

On the basis of his inspection the plaintiff's expert, a master mechanic, discovered that two parts of the steering mechanism, the upper control ball joint and the right tie rod ends were broken; yet he was unable to say that the accident was the result of a defect. The accident might well have caused the damage to the parts or, conversely, their failure might have caused the accident. Given those contradictory inferences, the expert could not give his honest opinion as to the existence of a mechanical defect in the car. He stated that a proper diagnosis could only be had if the car was in one piece or could be driven. In its persent state no diagnosis was possible.

The rental agency introduced testimony that they had the car 'thoroughly' inspected and serviced upon acquiring it. They further maintain that these 'thorough' inspections were performed after each of the five rentals prior to the time the plaintiff rented the car. The inspections were admittedly limited to 15 to 20 minutes duration. The plaintiff contends, however, that no test or inspection on the steering mechanism or the brake assembly was performed by a qualified mechanic in spite of the general inspections.

I. PROOF OF DEFECT.

The parties to this appeal have not seriously argued that strit liability in tort should not be the law of Hawaii where certain consumer products are involved. They focus more precisely on whether there has been an adequate showing of a defect in the present case. Before we reach that question, we must first settle the matter of the basis of liability.

Although this court has never had the occasion to rule on this matter, ² it is the modern tread and the better reasoned view that strict liability in tort is a sound legal basis for recovery in products liability cases. ³ The leading arguments for the adoption of a rule of strict products liability have been that the public interest in human life and safety requires the maximum possible protection that the law can muster against dangerous defects in products; that by placing the goods on the market the maker and those in the chain of distribution represent to the public that the products are suitable and safe for use; and that the burden of accidental injuries caused by defective chattels should be placed upon those in the chain of distribution as a cost of doing business and as an incentive to guard against such defects. ⁴

Therefore we adopt the rule that one who sells or leases a defective product which is dangerous to the user or consumer or to his property is subject to liability for physical harm caused by the defective product to the ultimate user or consumer, or to his property, if (a) the seller or lessor is engaged in the business of selling or leasing such product, and (b) the product is expected to and does reach the user or consumer without substantial change in its condition after it is sold or leased. This is essentially the rule adopted in the Second Restatement of Torts, Section 402A. We agree with the New Jersey Supreme Court in Cintrone v. Hertz Truck Leasing & Rental Service, 45 N.J. 434, 446, 212 A.2d 769, 775 (1965) that there is no good reason for restricting the duty to sellers alone. A lessor, like the seller, is in a better position to know a defect and control it, as well as distribute any resulting losses.

, while the basis for damages resulting from a defect in an automobile is that of strict liability in tort, this in no way dispenses with the requirements of proof that the product was in some way defective and that the damages were caused by the defect. This is the central issue in the present case. The plaintiff provided the only information that anything was wrong with the car. She claimed that it began going uncontrollably to the left of the road. Upon applying her brakes it jumped or jerked further to the left. In the absence of expert testimony on the exact cause of the accident or on the probabilities of a defect causing the accident, the issue squarely put is whether this testimony of the user and the fact of an accident of this character is enough to send the case to the jury.

The nature and quality of evidence used in products liability cases to show the defect and the nexus between the defect and the accident naturally varies. The most convincing evidence is an expert's pinpointing the defect and giving his opinion on the precise cause of the accident after a thorough inspection. If an accident sufficiently destroys the product, or the crucial parts, then an expert's opinion on the probabilities that a defect caused the accident would be helpful. If no such opinion is possible, as in the present case, the user's testimony on what happened is another method of proving that the product was defective. If the user is unable to testify, as where the accident killed him or incapacitated him, no other witness was present at the...