Harrington v. Labelle S of Colorad ( 1988 )

No. 88-57
IN THE SUPREME COURT OF THE STATE OF MONTANA
1988
RICHARD HARRINGTON,
Plaintiff and Appellant,
-vs-
LaBELLEIS OF COLORADO, INC., d/b/a
LaBELLEIS CATALOG SHOWROOMS, a Colorado
corp., and DAVID HEINE, d/b/a BILLINGS
SWEEPING SERVICE,
Defendants and Respondents.
LaBELLEIS OF COLORADO, INC., d/b/a
LaBELLE'S CATALOG SHOWROOMS, a Colorado
corp. ,
Third-Party Plaintiff and Appellant,
-vs-
BILLINGS SWEEPING SERVICE,
Third-Party Defendant.
APPEAL FROM: District Court of the Thirteenth Judicial District,
In and for the County of Yellowstone,
The Honorable Robert W. Holmstrom, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Datsopoulos, MacDonald & Lind; Ronald B. MacDonald,
Missoula, Montana (Harrington)
Herndon, Harper & Munro; Rodney T. Hartman, Billings,
Montana (LaBellels)
For Respondent:
P- .-
L- Anderson, Brown, Gerbase, Cebull, Fulton, Harman &
+
L
o :3 Ross; Steven J. Harman, Billings, Montana
Submitted on Briefs: Aug. 4, 1988
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Decided: December 6, 1988
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Clerk
Mr. Justice L. C. Gulbrandson delivered the Opinion of the
Court.
Richard Harrington and third-party plaintiff LaBelle's
appeal from a summary judgment granted in favor of Billings
Sweeping Service (the Service) in the District Court for the
Thirteenth Judicial District, Yellowstone County, Montana.
We affirm.
The issues are:
1. Did the District Court err in granting summary
judgment in favor of the Service on the issue of negligence
based on the rule of contractor nonliability?
2. Did the District Court err in granting summary
judgment in favor of the Service on the issue of strict
products liability under 5 402A, Restatement 2d of Torts?
3. Was the dismissal of LaBellels third-party complaint
proper?
This action arises out of a bicycle accident which
occurred in the parking lot of LaBellels in Billings on July
21, 1984. Richard Harrington was riding his bicycle through
the lot at approximately 9:00 p.m. when he struck a speed
bump, was thrown from the bike, and suffered severe head
injuries. Harrington sued LaBellels alleging that the speed
bumps were improperly designed, negligently maintained, and
inadequately marked to warn of their inherent latent danger.
LaBelle's filed a third-party complaint against the
contractor who had installed the bumps, alleging that the
contractor was solely responsible for the design,
construction and installation of the speed bumps. The
third-party complaint did not allege the parties had
contracted for painting the speed bumps. LaBellels sought
contrihution or indemnity jn the event that it was found to
be liable. Harrington then filed an amended complaint to
include the contractor, Billings Sweeping Service, seeking
recovery on theories of negligence and strict products
liability. On motion, the District Court granted summary
judgment to the Service and dismissed LaBelle ' s third-party
complaint.
As to the negligence claim, the District Court found the
Service not liable based upon the rule of contractor
nonliability also known as the "Accepted Work Rule Doctrine,"
which has been adopted by this Court. Also, no cause of
action would lie under the products liability claim since the
court found speed bumps are not a "product" for purposes of
S 402A, Restatement 2d of Torts. Mr. Harrington and
LaBelle's appeal from this order.
I
Did the District Court err in granting summary judgment
in favor of the Service on the issue of negligence based on
the accepted work rule doctrine?
Montana has adopted the rule that an independent con-
tractor will not be liable to third-parties for injuries
which occur after the contractor has completed the work and
the work has been turned over to and accepted by the employ-
er. The accepted work rule doctrine was first recognized in
Montana in Ulmen v. Schwieger (1932), 92 Mont. 331, 12 P.2d
856. The rule is based on the lack of any duty owing by the
contractor to the injured third-party at the time of the
injury. Instead, the person employing the contractor is
substituted as the responsible party. The accepted work rule
doctrine established in Ulmen has been upheld and applied in
related Montana cases since then. See Olson v. Kayser
(19731, 161 Mont. 241, 505 P.2d 394; ~annifin 17.
Cahill-Mooney Construction (1972), 159 Mont. 413, 498 P.2d
1214.
On appeal Mr. Harrington asks this Court to reconsider
the rule. He argues that the facts and equity of this case
compel us to revise the long-standing rule of Ulmen or to
carve out exceptions to that rule. He contends that Ulmen
does not represent the modern view and cites cases from
jurisdictions which have extended contractor liability to
foreseeable injury caused by negligent construction. This is
not the rule in Montana, however, and we decline to depart
from the line of cases which have established otherwise. In
doing so, we direct our attention to the "facts" and "equity"
of this case.
LaBellels is located at a busy intersection in Billings.
To avoid the traffic signal at that intersection, traffic
frequently cuts across LaBellels parking lot between 24th and
Central. To slow and discourage this traffic, LaBelle's
manager contracted with Billings Sweeping Service to install
two speed bumps in the parking lot. The record conflicts as
to who solicited whom, but a work order was processed on May
3, 1984, and construction was completed on or about that
date.
The bumps were made of asphalt, the same material as the
parking lot, and were not marked or painted in any way so as
to distinguish them from the parking lot's smooth surface.
There is disagreement in the depositions about who was re-
sponsible for the design and placement of the bumps and why
the speed bumps did not get striped, painted, or otherwise
marked.
Despite the conflict in facts surrounding the speed bump
construction, there is no doubt that the Service had turned
over, and LaBelle's had accepted, the contracted work. Upon
completion, LaBelle's paid the Service for the job, and the
Service completely removed itself from the premises prior to
the accident, which occurred approximately 70 days
thereafter. There is no evidence that LaBellefs requested
any follow-up work or made any complaints to the Service
prior to the accident. These facts substantiate the District
Court's findings that the Service had turned over and
LaRellels had accepted the work on the speed bumps, so as to
satisfy the accepted work rule doctrine.
Regarding Mr. Harrington's plea in equity, we note that
he has settled with LaBelle's for $125,000. We find little
merit in his argument that he will be left "without recovery"
unless this Court revises or finds exceptions to the accepted
work rule doctrine as established in Ulmen. For these
reasons, we hold that the District Court did not err in
granting summary judgment to the Service on the issue of
negligence.
Did the District Court err in granting summary judgment
in favor of the Service on the issue of strict products lia-
bility under 5 402A, Restatement 2d of Torts?
Mr. Harrington contends that the Service should be held
strictly liable as the manufacturer of a defective and unrea-
sonably dangerous product. He argues that a speed bump
should be recognized as a "product" for purposes of S 402A
Restatement 2d of Torts.
To date, there are no Montana cases which discuss the
meaning of "product" for a strict products liability case.
In refusing to recognize a speed bump as a product, the
District Court relied on policy considerations set forth in
the case in which Montana adopted the doctrine of strict
labilit. See Brandenburger v. Toyota Motor Sales (1973),
162 Mont. 506, 513 P.7d 268. In that case, this Court said:
Inherent in these pol-icy considerations
is not the nature of the transaction
. .
. hut the character of the defect
itself . . . and the unavailability of an
adequate remedy on behalf of the injured
plaintiff.
Rrandenburger, 513 P.2d at 273 (quoting Escola v. Coca Cola
Bottling Company of Fresno (Cal. 1944), 150 P.2d 436).
Based on our review of these policy considerations, we
agree with the District Court that a speed bump is not a
"product" for purposes of S 402A strict liability. A major
goal of the doctrine was to afford the plaintiff a remedy in
the face of an extremely complicated manufacturing industry,
where the inability of the plaintiff to pinpoint a negligent
act or a negligent party could preclude recovery altogether.
As was pointed out by the District Court, there is no problem
of a remote manufacturer or the inability to trace a specific
negligent act in this case. Our determination in no way
affects Mr. Harrington's existing settlement agreement with
LaBellels, so he is not left without adequate remedy. We
hold that the District Court did not err in granting summary
judgment on the issue of strict products liability.
Was the dismissal of LaBelle's third-party complaint
proper?
Montana law does not allow a claim for contribution or
indemnity to be asserted by a defendant against a
co-defendant who is not liable to the plaintiff. Section
27-1-703, MCA. See State ex rel. Deere and Company v. Dis-
trict Court (Mont. 1986), 730 P . 2 d 396, 400, 43 St.Rep. 2270,
2274. Since w e have affirmed the District Court's granting
of summary judgment in favor of the Service, it follows that
LaBelle's claim for contribution or indemnity must fail. We
conclude that the District Court properly dismissed L a R e l l e l s
claim. We affirm.
Justicg '
,
&PSH~
Justices
Mr. Justice Fred J. Weber dissents as follows:
The majority relies upon a longstanding legal doctrine
to bar recovery from Billings Sweeping Service without justi-
fying its application to this particular case or to modern
theories of liability in qeneral. While it is generally
appropriate to follow the rulings of past decisions, I be-
lieve that this Court should examine the reasoning behind the
rule of contractor nonliability before applving it to this
case.
Historically, the "accepted work doctrine" has been
justified on several grounds. These include: (1) a lack of
contractual privity between a building or construction con-
tractor and injured third parties; (2) that there would be no
end to a contractor's litigation unless liability ceased
after the work was accepted; (3) the true proximate cause of
a third party's injury is the owner's negligence in maintain-
ing the property; and (4) public policy confines liability
for negligent construction of a complicated structure to the
owner or contractee. 58 Annat., A.L.R.2d 869, 870 (1958).
These justifications are incorporated into Montana law in the
case of Ulmen v. Schwieger (1932), 92 Mont. 331, 12 P.2d 856,
which is cited by the majority as support for its holding
that a contractor may not be held liable to an iniured third
party. I question whether these are adequate grounds for the
majority's holding in light of our general rules of negli-
gence in Montana.
Other jurisdictions have held that the principles sup-
porting the rule of contractor nonliability do not mesh with
modern theories of negligence. The leading case in which the
District of Columbia Circuit refuted these justifications for
contractor nonliability is Hanna v. Fletcher (D.C.Cir. 1956),
231 F . 2 d 469. The court reasoned that the antiquated
justifications based on lack of privity had no place in
modern theories of liability as set forth in MacPherson v.
Auick Motor Co. (1916), 217 N.Y. 382, 111 N.E. 1050. In
MacPherson, the question was whether an automobile manufac-
turer could be held liable to a consumer for injuries result-
ing from a sudden collapse of the car due to defective wood
used in one of its wheels. Judge Cardozo responded that:
If the nature of a thing is such that it is reason-
ably certain to place life and limb in peril when
negligently made, it is then a thing of danger.
Its nature gives warning of the consequences to be
expected. If to the element of danger there is
added knowledge that the thing will be used by
persons other than the purchaser, and used without
new tests, then, irrespective of contract, the
manufacturer of this thing of danger is under a
duty to make it carefully.
111 N.E. at 1053.
In Hanna v. Fletcher, the court considered a claim for
personal injury by a plaintiff who sued a construction con-
tractor for negligent repair of a stair railing on an exist-
ing building. Several years after the repair work was
completed and paid for, the railing collapsed during use and
caused the plaintiff to fall into the stairwell, which re-
sulted in serious injuries. The court concluded there was no
reason to differentiate between the manufacturer of goods and
a building contractor "for in each case negligent conduct
often may be expected to result in injury to one reasonably
foreseen as a possible user." Hanna, 231 F. 2d at 474. The
court applied Judge Cardozo's analysis and held the construc-
tion contractor liable for his negligent repair of the
railing.
This Court has followed MacPherson and allowed recovery
for negliqence asserted against the manufacturers of automo-
biles [see Rix 17.General Motors Corp. (Mont. 1986), 723 P . ? d
195, 43 St.Rep. 12961 and manufacturers of farm machinery
[see Brown v. North American Manufacturing Co. (1978), 176
Mont. 98, 576 P.2d 7111. We concluded in those cases that it
was no longer appropriate to bar recovery on theories such as
those identified in connection with the accepted work doc-
trine, that is a lack of contractual privity, or that there
would be excessive litigation, or similar theories. Given
our rules of liability in cases where negligent construction
by a manufacturer may cause injury, I see no reason why we
should not extend that reasoning to applv to negligent con-
struction by a contractor. Certainly the potential for
injury due to negligent construction by a contractor is just
as great as with the negligent manufacturing of a consumer
good. I conclude that this Court should have revj-ewed the
reasoning upon which the denial of liability is founded.
While the facts presently before us may indicate a rather
weak claim on the part of Mr. Harrington with regard to the
proving of elements of negligence against Billings Sweeping
Service, there is a proper legal theory which should allow
him to continue with his cause of action.
I recognize there may be limitations which should be
placed upon a theory of recovery against a building contrac-
tor. But an absolute bar to liability is not appropriate.
The majority has failed to explain why a contractor should
not be responsible for its own negligence. For this reason,
I believe that this Court should have evaluated what I see as
an outmoded concept to redefine our rules of liability in a
case such as this. Thus, liability would more appropriately
be predicated on the presence or absence of negligence on the
part of the various parties involved, including the construc-
tion contractor.
I concur in the foregoing dissenp.