Washburn v. Beatt Equipment Co.

• Decision Date: 25 November 1992
• Docket Number: No. 57736-6,57736-6
• Citation: 840 P.2d 860,120 Wn.2d 246
• Court: Washington Supreme Court
• Parties: Norman WASHBURN and Sharon Washburn, husband and wife, Respondents, v. BEATT EQUIPMENT COMPANY, a foreign corporation, formerly known as or doing business as Mid-Mountain Contractors, Appellant.

Page 246

120 Wn.2d 246

840 P.2d 860

Norman WASHBURN and Sharon Washburn, husband and wife, Respondents, v. BEATT EQUIPMENT COMPANY, a foreign corporation, formerly known as or doing business as Mid-Mountain Contractors, Appellant.

No. 57736-6.

Supreme Court of Washington,

En Banc.

Nov. 25, 1992.

Reconsideration Denied Feb. 3, 1993.

Reed & McClure, William R. Hickman, Heather Houston, Seattle, for appellant.

Edwards, Sieh, Wiggins & Hathaway, Charles K. Wiggins, Fury & Bailey, William S. Bailey, Seattle, for respondents.

Douglas A. Hofmann, Mary H. Spillane, Robert C. Manlowe, Seattle, amicus curiae, for appellant on behalf of Associated Gen. Contractors.

Stephen P. Larson, Seattle, amicus curiae, for appellant on behalf of Washington Defense Trial Lawyers.

Bryan P. Harnetiaux, Gary N. Bloom, Spokane, amicus curiae, for respondents on behalf of Washington State Trial Lawyers Ass'n.

BRACHTENBACH, Justice.

This appeal by defendant is from a judgment rendered upon special jury verdicts. The plaintiffs are Norman Washburn and his wife Sharon. Mr. Washburn was extensively burned and permanently injured when a standby propane fuel system caught fire and exploded. The jury awarded plaintiff ¹ $6 million and his wife $2 million.

Plaintiffs cross-appeal the calculation of the amount of judgment against defendant, Beatt Equipment Company, which was reduced to a total of $5,670,000. We affirm except to modify the amount of the judgment, for reasons explained hereafter.

We briefly summarize the defendant's contentions. (1) Defendant's principal argument on liability is that plaintiffs' action is barred by a statute of repose. The statute of repose does not protect a manufacturer. The jury was instructed on the definition of "manufacturer". That instruction was proposed by defendant. The jury, by special verdict, found as a matter of fact that defendant was a manufacturer, as defined by defendant. Further, by special verdict, the jury found that defendant's product was not reasonably safe, as defined in an instruction to which no exception was taken. (2) Defendant On October 15, 1986, plaintiff Norman Washburn and a fellow Boeing employee, Scottie Holmes, were at a Boeing/Kent building to test a standby propane fuel system. The propane system had been in place since its construction and installation by defendant in 1969, but had never been put to regular use. Plaintiff turned on the propane and saw there was no pressure showing on the gauge. Before he could investigate, "everything just blew up." Verbatim Report of Proceedings (VRP) vol. 3, at 159.

claims an abuse of discretion in admitting certain photographs. (3) Defendant attacks the size of the verdicts. (4) Defendant claims error in a pretrial procedural ruling.

The building caught fire. Automobiles in the adjacent parking lot caught fire and exploded. Fire was shooting out of the ground. There was a wall of fire. VRP vol. 3, at 88, 160. Plaintiff and Holmes were both on fire; Holmes was completely aflame. Plaintiff "had fire on his head, his hair, his back." VRP vol. 3, at 91. Plaintiff rolled on the ground, but Holmes ran in circles. Plaintiff ran to help Holmes but caught on fire again. Skin was falling off both of them. Plaintiff helped put out the fire on Holmes and yelled for someone to turn off the propane to prevent the storage tank from exploding. VRP vol. 3, at 160-63.

Holmes died 10 hours later. Plaintiff, with burns on 70 percent of his body, was hospitalized from October 15 to December 24. He underwent six surgeries during that confinement, and four additional surgeries over the next 16 months. His injuries will be described in the discussion of the damages award.

The defendant Beatt Equipment Company was known as Mid-Mountain Contractors when it contracted to construct the pipeline system. It specialized in pipeline excavation and construction in the 11 western states. It had experience in installing gas pipelines, having done about $150 million of work in Washington State alone. Defendant's president agreed that defendant held itself out as an expert in installing pipelines. VRP vol. 5, at 305. Defendant became involved in creation of the standby heating system when a subcontract There was substantial evidence that defendant did not comply with contract specifications and did not meet industry standards. One expert testified, without objection, that these failures by defendant caused the explosion. VRP vol. 6, at 215. There was expert testimony that the pipe was significantly thinner than called for in the specifications. VRP vol. 6, at 196; vol. 7, at 323. The pipe was not properly prepared before it was welded, wrapped and coated. As a result corrosion was inevitable. VRP vol. 7, at 322, 337-38. The coating which is applied to the welded and wrapped joints is critical to protection against corrosion. The specifications called for a coal tar enamel; defendant used cheaper, less durable and more permeable asphalt coating, and applied a thickness roughly a third less than specified. VRP vol. 5, at 273-83. The thinner coating would "definitely decrease the life of the coating." VRP vol. 5, at 282-83.

                was awarded to it by Petrolane, which had a contract with Boeing to install a standby propane fuel system at its Kent facility.   Defendant was to supply all the piping material, do various finishing processes, and bury the pipeline.   Exhibit 26
                

A coatings expert testified, without objection, that the improper coating material, applied at less thickness than specified, contributed to the corrosion which caused the explosion. VRP vol. 5, at 283.

The coating was damaged before the pipe was buried. VRP vol. 6, at 204. The backfill material did not meet specifications; consequently chunks of asphalt material damaged the coating. This was a very important defect. VRP vol. 6, at 201-02, 205. The experts testified that the installation was substandard, and that the variations from the specifications and industry standards were "[g]reatly significant." VRP vol. 6, at 199, 211. The experts testified, without objection, that these deficiencies were the proximate cause of the explosion.

With that background we turn to the heart of the question of liability. The only defense to liability asserted on appeal is the statute of repose. Defendant argues that it constructed an improvement upon real property within the However, the statute of repose is subject to an exception, i.e., it "shall not apply to claims or causes of action against manufacturers". RCW 4.16.300.

                reach of RCW 4.16.300. 2  Under RCW 4.16.300 and .310, 3 a cause of action must accrue within 6 years of substantial completion of the improvement, and then a claimant must file suit within the applicable statute of limitations.  Del Guzzi Constr.  Co. v. Global Northwest Ltd., 105 Wash.2d 878, 883, 719 P.2d 120 (1986).   Defendant argues that plaintiffs' cause of action would have to have accrued within 6 years of completion of its work
                

Because of this particular record, we have a very narrow issue concerning whether defendant was a "manufacturer" within the proviso in RCW 4.16.300. More particularly, if there was a jury question whether defendant was a manufacturer, affirmance is required.

First, however, we note plaintiffs' argument that the pipeline was not an "improvement upon real property" within Second, we dispose of the alternative product seller theory of liability. Plaintiffs were allowed to pursue their claim that defendant was a product seller to whom the statute of repose did not apply. It is true, as plaintiffs claim, that the jury necessarily found defendant to be a product seller under the instructions given. Under jury instruction 17, the jury had to find that defendant was a product seller in order to determine that defendant was a manufacturer. However, to prevail on their theory that defendant was a product seller whose negligence caused plaintiffs' injuries, plaintiffs had to establish defendant's negligence. See RCW 7.72.040(1)(a). The special verdict forms directed the jury to first determine whether defendant was a manufacturer and then, if the jury found that defendant was a manufacturer, to proceed to the special verdict form for determining liability on that theory. The jury therefore never answered questions about whether defendant was negligent as a product seller. We do not address the product seller theory, as we uphold the verdict and judgment on manufacturer liability grounds.

                the meaning of RCW 4.16.300, contrary to the trial court's determination.   If the pipeline was not an improvement to real property, RCW 4.16.300 simply does not apply and the builder's statute of repose, RCW 4.16.310, does not bar the suit.   We base our decision in this case upon other grounds, however, and assume, without deciding, that the pipeline was an improvement upon real property, as the trial court held
                

To decide whether this case should have gone to the jury on the issue whether defendant was a manufacturer, and therefore not protected by the statute of repose, we first look to the definition in the jury instructions. The relevant instruction is the trial court's instruction 17, given exactly as submitted by defendant and set out in the footnote. ⁴ We then examine the facts to ascertain whether defendant's activities fall within that definition.

We emphasize that the definition of "manufacturer" is contained in only one instruction. That instruction was submitted by the defendant. At the instruction conference, defense counsel, in referring to defendant's proposed definition of manufacturer, stated: "I think that this is a correct statement of the law ...". VRP vol. 8, at 664. Defense counsel was careful to note his exception to submitting the case to the jury on the theory that it was a manufacturer, VRP vol. 8, at 664-65, but the definition of manufacturer is binding on defendant as its proposed instruction. There was no exception to the instruction...