SW (Delaware), Inc. v. American Consumers Industries, Inc.
| Decision Date | 15 April 1982 |
| Citation | 450 A.2d 887 |
| Parties | SW (DELAWARE), INC., d/b/a SW Industries, Inc., a Delaware corporation, and B. T. R., Inc., a Delaware corporation, Defendants and Third Party Plaintiffs Below, Appellants, v. AMERICAN CONSUMERS INDUSTRIES, INC., Third Party Defendant Below, Appellee. . Submitted: |
| Court | United States State Supreme Court of Delaware |
Upon appeal from Superior Court. Affirmed.
Morton Richard Kimmel and Michael Weiss (argued) of Kimmel & Spiller, P. A., Wilmington, for defendants and third party plaintiffs below, appellants.
B. Wilson Redfearn and Colin M. Shalk (argued) of Tybout, Redfearn, Casarino & Pell, Wilmington, for third party defendant below, appellee.
Before HERRMANN, Chief Justice, QUILLEN and HORSEY, Justices.
In this product liability third-party claim, the manufacturer of an allegedly defective machine seeks indemnification from the machine's purchaser for any damages awarded the purchaser's employee for personal injury sustained while operating the machine. The manufacturer's successors (collectively referred to as "SW"), defendants and third party plaintiffs below, appeal Superior Court's grant of the employer's, American Consumer Industries, Inc. (hereafter ACI), Motion to Dismiss the third party complaint, which the Court treated as a Motion for Summary Judgment.
ACI's employee, David Fehl, plaintiff below, was injured while operating an ice-cubing machine designed, manufactured and sold by SW to ACI. Fehl's injury occurred when his foot slipped while he was trying to clean snow off the machine while it was in operation. In the course of falling upon the machine, his right hand went into an uncovered opening and came in contact with the machine's saw blade, which severed his fingers.
After collecting workmen's compensation benefits from ACI, his employer, Fehl filed the instant personal injury suit against SW as the designer, manufacturer and seller of the machine. The Complaint states alternative claims against SW for liability without fault, or strict liability, as well as for negligence. Plaintiff Fehl alleges that his injury resulted from the machine's lack of safeguards and safety devices as well as SW's negligence in the design, manufacture, testing and inspection of the machine.
SW contends in its amended third-party Complaint that ACI is liable for indemnification, should SW be held liable to Fehl, because of ACI's breach of an implied contract 1 with SW. The essence of the alleged implied contract was that ACI would use due care in its installation and operation of SW's ice-cubing machine. ACI's installation of the machine is said to have been improper because the machine was placed on I-beams extended over a heated pit and that ACI thereby created an unsafe work condition for ACI's employees, including Fehl, and thereby breached its implied contract with SW to use due care.
Superior Court dismissed SW's third-party complaint based on ACI's allegedly improper installation of the machine as being insufficient as a matter of law to establish either: (a) an implied contract between the manufacturer and the purchaser and hence duty running from ACI to SW or (b) a special relationship between manufacturer and purchaser as found to exist in Diamond State Tel. Co. v. University of Delaware, Del.Supr., 269 A.2d 52 (1970) or in Roy v. Star Chopper Co., Inc., D.R.I., 442 F.Supp. 1010 (1977), aff'd, 1st Cir., 584 F.2d 1124 (1978). The Superior Court found the relationship between SW and ACI to be simply that typically found to exist between a manufacturer/seller and a purchaser/user. We agree and therefore affirm.
SW correctly states Delaware law as recognizing that a third-party tortfeasor may assert a claim for indemnification against the injured party's employer for the latter's breach of contract--express or implied--with the third party to perform in a careful and prudent manner, assuming the employer's breach of such duty was the actual cause of its employee's injury. Diamond State Tel. Co. v. University of Delaware, supra; Powell v. Interstate Vendaway, Inc., Del.Super., 300 A.2d 241 (1972). This ruling, of course, represents an exception to the exclusivity principle of our workmen's compensation law referred to above. (See footnote 1 above.) In Diamond State this Court, paraphrasing and adopting the position taken in 2A Larson, Workmen's Compensation Law, § 76.00 (1970), stated that a third party has a right to maintain an action against a negligent employer who may be held liable for indemnity if the employer:
Diamond State Tel. Co. v. University of Delaware, supra, at 56-7.
The question then presented is whether there was sufficient evidence of either an implied obligation or independent duty running from ACI to SW apart from and independent of any obligation owed by ACI to its employees, including Fehl. SW contends that the averments of the third-party Complaint are sufficient to show the existence of a "separate contract" between ACI and SW. SW says, "[t]he fact that [ACI] installed the machine and did so in an improper manner, created the implied contract between [ACI] and [SW] independent of any duties owed by [ACI] to its employees"; and since Fehl's injury resulted from the unsafe manner in which the ice-cubing machine had been installed, ACI thereby breached its contract with SW. (underlining added for emphasis). Thus, SW contends that ACI came under a duty "to install and use the machine in a safe and proper manner [and] [b]y failing to do so, ACI breached an independent duty owed to [SW]."
SW's alternative basis for indemnity is that a "special relationship" arose between it and ACI "because ... [ACI] was required 2 to design and install the flooring ..."; and that ACI thereby became a co-designer and co-manufacturer of "an integral part of the system" for melting accumulated ice from the machine. SW asserts that this "special relationship" is analogous to one found to exist between an employer and a third-party machine manufacturer in Roy v. Star Chopper, Inc., supra.
ACI responds: (a) that it bought the machine in a nearly-assembled condition and ready for operation upon its two parts being bolted together and then being secured to a flooring; (b) that its placement of the machine on I-beams over a pit was not an integral part of the ice-cubing machine; and (c) that...
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