White v. Uniroyal, Inc.

• Decision Date: 30 April 1984
• Citation: 155 Cal.App.3d 1,202 Cal.Rptr. 141
• Court: California Court of Appeals Court of Appeals
• Parties: Robert E. WHITE et al., Plaintiffs and Appellants, v. UNIROYAL, INC., Defendant and Respondent. A011904.

Page 141

202 Cal.Rptr. 141

155 Cal.App.3d 1

Robert E. WHITE et al., Plaintiffs and Appellants, v. UNIROYAL, INC., Defendant and Respondent.

A011904.

Court of Appeal, First District, Division 4, California.

April 30, 1984.

Arthur A. Levy, Cavin & Levy, San Francisco, for plaintiff and appellant Robert E. White.

Mark H. Pierce, Clark & Glennon, P.C., San Jose, for plaintiffs and appellants Beatrice S. Grimes, Ruby A. Grimes and Daniel G. Grimes.

John McBride, Wylie, Blunt & McBride, San Jose, for plaintiff and appellant Roscoe Shields.

Weyman I. Lundquist, Ida O. Abbott, Heller, Ehrman, White & McAuliffe, San Francisco, for defendant and respondent.

RATTIGAN, Associate Justice. ^*

The separate appeals herein have been taken in personal injury actions, and an action for wrongful death, which were consolidated for trial. The jury returned a defense verdict in each action. The appeals are from judgments entered on the verdicts.

PRELIMINARY SUMMARY

At pertinent times, Teledyne McCormick Selph, a corporation ("Teledyne"), operated a chemical manufacturing plant at Hollister. In 1974, Teledyne entered into a written contract with defendant and respondent Uniroyal, Inc. ("Uniroyal"). The contract obligated Teledyne to sell and deliver to Uniroyal specified and scheduled quantities of unsymmetrical dimethylhydrazine ("UDMH"), a chemical compound.

Teledyne proceeded to manufacture the UDMH at a facility constructed for the purpose at the plant in Hollister. Appellants Robert E. White and Roscoe Shields, and Robert C. Allen and Gerald Grimes, were employed by Teledyne in the manufacturing operation. On April 3, 1975, an explosion and fire occurred when a flammable gas escaped from equipment used in the operation. White, Shields, Allen, and Grimes were injured in the accident. Grimes subsequently died as a result of his injuries. White, Shields, and Allen commenced separate personal injury actions against several named entities (not including Uniroyal) and "DOE" defendants. Grimes' widow and children (appellants Beatrice S. Grimes, Ruby A. Grimes, and Daniel E. Grimes) commenced a wrongful death action against the same defendants.

The four actions were consolidated for trial. Thereafter, Uniroyal was named by amendment as one of the "DOE" defendants in the consolidated actions; the actions were dismissed as to the defendants who had initially been sued by name; and the complaints were amended to state three causes of action against Uniroyal alone. Uniroyal answered these causes of action, which were tried against it (i.e., Uniroyal alone) at a consolidated jury trial of the four actions. The jury returned a defense verdict in each action. Plaintiffs White, Shields, and Grimes appeal from the judgments consequently entered against them in their respective actions. Plaintiff Allen has not appealed.

THE PLEADINGS AS TO UNIROYAL

The causes of action stated and tried against Uniroyal will be summarized because they framed the issues presented on the appeals. The first cause of action was pleaded in an amendment of the complaint which had initially been filed by appellants Grimes. They alleged in this cause of action that at pertinent times Gerald Grimes, their decedent, had been employed by Teledyne at its plant in Hollister. They further alleged that on April 3, 1975, Uniroyal "negligently and carelessly operated, ... maintained, controlled, inspected and performed supervisory duties with reference to [a] chemical reactor located at said plant ..."; and that, as a proximate result, "hazardous and volatile chemical fumes were ... released from said chemical reactor and ... did ignite[,] thereby causing Plaintiffs' decedent severe burns ... which resulted in ... his death...." Uniroyal answered this cause of action, pleading general denials and alleging various affirmative defenses.

All of the plaintiffs joined in the second and third causes of action, which were stated in a stipulated amendment of the complaint initially filed by appellant Shields. It was alleged in each of these causes of action that at pertinent times Shields, White, and Allen had also been employed by Teledyne at the plant in Hollister, and that each had been injured in the fire on April 3, 1975. The plaintiffs added allegations charging Uniroyal with liability on the theories that Teledyne had contracted to "produce" (or to "create and manufacture") UDMH for Uniroyal, and its "production" involved a "peculiar" risk of harm in the absence of "special precautions" In an answer to the second and third causes of action, Uniroyal pleaded general denials and alleged as affirmative defenses (among others) that "Plaintiffs' employer was not Uniroyal's employee or independent contractor" and that "the production of UDMH is not [an] inherently dangerous or ultrahazardous activity."

which Uniroyal had negligently failed to take. ¹

THE TRIAL AND FURTHER PROCEEDINGS

In the course of the consolidated jury trial, the court denied timely motions by Uniroyal for a nonsuit and for a directed verdict. On the tenth day of the trial, the jury returned defense verdicts on "Special Verdict" forms showing its determination in each action that Uniroyal had not been "negligent." ^{2 2} A poll of the jury established that the determination had been made by a 9-3 vote in each instance.

A "Judgment On Special Verdict" was entered in favor of Uniroyal in each of the four actions. Plaintiffs White, Shields, and Grimes filed timely notices of appeal from the judgments entered in their respective actions.

THE EVIDENCE

The trial record supports the summaries of the evidence which follow. The classifications shown in the captions are required by the issues presented on the appeals.

The Evidence Pertaining To The Written Contract Between Uniroyal And Teledyne

As will appear in detail, this contract was entitled "Sales Agreement"; it provided that Teledyne thereby "sells" UDMH to Uniroyal; it identified the parties as "Seller" and "Buyer," respectively; and it did not expressly obligate Teledyne to manufacture the UDMH. As will also appear, the issues on appeal include a question whether the contract had the effect of limiting the parties' relationship to that of vendor and vendee, as a matter of law, to the exclusion of a relationship in which Uniroyal employed Teledyne to manufacture UDMH as an independent contractor. Evidence bearing on this question was liberally admitted, without objection or over objections in some instances. We summarize all of it here.

Uniroyal and Teledyne were brought together by James C. Dodgen. He testified that he was in business for himself as a The supply of UDMH was "critical in the United States" when FMC stopped manufacturing it. FMC supplied Uniroyal with the UDMH it required in 1974. Uniroyal then had no supply to meet its needs, which were urgent because of schedules to be met in the production of ALAR for marketing in 1975. Early in 1974, Uniroyal approached Dodgen and asked him "to assist them in obtaining a source of supply" of UDMH. He and Uniroyal thereupon executed a written contract in which Dodgen was employed as a "Consultant" to "assist Uniroyal" with regard to several specified "subjects." One of the "subjects" was "[t]he routes [sic ] to the manufacture of unsymmetrical dimethylhydrazine (UDMH)."

chemical engineer. He had been in "contact" with UDMH since 1955. UDMH was used as a "propellant for rockets and missiles," and as an agricultural chemical. In and before 1974, Dodgen worked as a consultant to the U.S. Navy in the manufacture of UDMH, for the Air Force, at an ordinance station located at Indianhead, Maryland. At that time, the Air Force and Uniroyal were the [155 Cal.App.3d 12] only "primary users" of UDMH. The Air Force used it as rocket fuel. Uniroyal used UDMH in the manufacture of an agricultural chemical which it marketed under the trade name of ALAR. Uniroyal had regularly obtained UDMH from "FMC," a firm which manufactured it until 1974.

Dodgen testified that he then approached at least 25 different "companies," including Du Pont. It was suggested at Du Pont that Dodgen "contact Teledyne in California" because UDMH is a "hydrazine" and Dr. Donald Thatcher, an employee at Teledyne who had formerly worked for Du Pont, held a patent for a process used in the "manufacture" of hydrazines. Dodgen accordingly "contacted Teledyne, asked them what their interest was, told them what the requirement was." Teledyne expressed interest. In November of 1974, Dodgen visited Teledyne "to verify ... that they were actually interested and would consider selling this material to Uniroyal." He discussed these subjects with Hugh Bennett, who was then the president of Teledyne. ³ Between mid-November and early December, Teledyne informed Uniroyal that it would "accept" a "purchase order" for UDMH.

Dr. Thatcher testified as follows: He is a chemist by profession. In 1974 and 1975, he was vice-president of Teledyne in charge of "research and development." Plaintiff Robert Allen was executive vice-president. Teledyne's principal business at that time was the production of "ordnance items," or "specialty explosives." Thatcher had worked for Du Pont from 1954 to 1972. During that period, he had been granted a patent on "a process or a portion of a process of development of UDMH."

Neither Thatcher nor Teledyne had engaged in commercial production of UDMH prior to 1974. Thatcher first learned that Teledyne "might be asked to produce it" in November of that year, when Dodgen approached Teledyne on behalf of Uniroyal. Dodgen met with Thatcher and other Teledyne personnel on two occasions in November. At the first meeting, Dodgen asked if Teledyne "would be interested in manufacturing or producing UDMH...." It was agreed at this meeting that if Teledyne "was to manufacture UDMH" Thatcher would "designate the process that would be used...." There were discussions of his "qualifications to understand production of UDMH" and his ...