Frankenmuth Insurance v. City of Hickory

NO. COA14-70
NORTH CAROLINA COURT OF APPEALS
Filed: 15 July 2014
FRANKENMUTH INSURANCE, as subrogee
of Catawba Country Club,
Plaintiff,
v. Catawba County
No. 11 CVS 689
CITY OF HICKORY, a North Carolina
Municipal Corporation, and MORGAN
FIRE & SAFETY, INC., a North
Carolina Corporation d/b/a UNIFOUR
FIRE & SAFETY,
Defendants.
Appeal by plaintiff from order entered 14 May 2013 by Judge
Timothy S. Kincaid in Catawba County Superior Court. Heard in
the Court of Appeals 6 May 2014.
Dean Gibson Hofer & Nance, PLLC, by Jeremy S. Foster, for
plaintiff-appellant.
Cranfill Sumner & Hartzog LLP, by Jaye E. Bingham-Hinch and
Patrick H. Flanagan, for defendant-appellee City of
Hickory.
HUNTER, Robert C., Judge.
Frankenmuth Insurance (“plaintiff”), as a subrogee of
Catawba Country Club (“the Club”), appeals from an order
granting the City of Hickory’s (“defendant’s”) motion for
summary judgment on plaintiff’s negligence claim. On appeal,
plaintiff argues that the trial court erred by entering summary
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judgment in favor of defendant because genuine issues of
material fact existed as to whether: (1) defendant negligently
operated its municipal water system, and (2) the Club was
contributorily negligent in its installation of sprinkler system
pipes.
After careful review, we affirm the trial court’s order.
Background
On 5 July 2009, a water pipe leading to the Club’s
sprinkler system burst, causing damage to the clubhouse. The
Club was insured by plaintiff, which filed this action against
defendant as the Club’s subrogee. In the complaint, plaintiff
alleged that defendant’s negligent care of the municipal water
system, specifically in allowing unreasonably high water
pressure to build up in the pipes, was the proximate cause of
the damage.
In 2000, the Club hired Crawford Sprinkler Company
(“Crawford”) to install a sprinkler system on its grounds.
Defendant sent members of its Fire Prevention Office to the site
to measure the water pressure of the area. The standing water
pressure was 180 pounds per square inch (“psi”). Kevin Greer
(“Greer”), the Assistant Public Services Director for defendant,
testified during deposition that 180 psi was not an uncommon
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standing water pressure in that service area. The average
citywide standing water pressure was 115 to 120 psi, with some
areas in the system attaining pressures of 230 to 240 psi.
It is undisputed that Crawford designed a sprinkler system
that called for eight-inch ductile iron pipes to be used
throughout, given the 180 psi standing water pressure at the
Club. However, Crawford actually installed six-inch PVC piping
instead. Greer explained in his testimony that piping comes in
two forms—PVC and ductile iron. PVC piping has two different
pressure ratings—Class 150 psi and Class 200 psi; ductile iron
comes in Class 250 psi and Class 350 psi. The ductile iron
pipes are designed to constantly withstand standing water
pressures within their class range, but they can also handle
pressure surges of two-and-a-half times the class rating so long
as the surges are not prolonged or sustained.
Stephen Busic (“Busic”), the Club’s General Manager,
testified during deposition that soon after installation of the
sprinkler system, the Club had continual problems with water
pressure. According to Busic, the PVC pipes burst six times due
to excess water pressure from 2000 through July 2009, with the
sixth burst forming the basis of this action. One of these
bursts occurred on 27 July 2007. Morgan Fire & Safety, doing
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business as Unifour Fire & Safety (“Unifour”), repaired this
break in the line and replaced a three-foot section of the PVC
pipe with ductile iron. One of Unifour’s employees testified
during deposition that it replaced the PVC piping with ductile
iron because ductile iron is stronger than PVC.
The flooding that forms the basis of this action occurred
on 5 July 2009. Martin Chang (“Chang”), plaintiff’s expert
witness, visited the Club on 15 July 2009 to investigate the
cause of the fracture. Chang was a forensic engineer; he
received a bachelor’s and master’s degree in textile engineering
but had no experience in designing or running a municipal water
system. After speaking with Busic and examining the site, Chang
determined that: (1) a longitudinal fracture was found on the
six-inch PVC pipe, indicating stress produced by internal
pressure; (2) the fire sprinkler pressure gauge failed at a
pressure greater than 300 psi; and (3) the cause of the failure
was excessive water pressure from defendant’s water supply and
potentially a sudden surge in water pressure. Chang noted
triangular fractures in the ductile iron reducers, but admitted
that he could not rule out mechanical mistakes made during
excavation of the pipe as the cause of the fractures. Greer
agreed with Chang’s assessment that the longitudinal fracture
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was caused by internal pressure. However, he developed the
opinion that the cause of the fracture was due to inferior
piping material, given that the six-inch PVC pipes actually
installed were of lesser strength than the minimum Class 250 psi
eight-inch ductile iron pipes that were called for in Crawford’s
plan.
After making insurance payouts to the Club, plaintiff
brought this action against defendant and Unifour. It alleged
that Unifour was liable for the damages, in part, because it
“[n]egligently failed to recommend removal of the six-inch PVC
pipe and . . . replacement with eight-inch ductile iron pipe for
the entire distance between the pit and the clubhouse.”
Plaintiff alleged that defendant was negligent when it: (1)
“negligently failed to ensure that the water pressure in its
municipal water supply did not exceed reasonable levels”; (2)
“negligently failed to correct the layout of its municipal water
distribution system with a ‘loop’ system to protect residents at
the terminal ends against excess pressures, water hammer, and
shock waves within the water distribution system”; and (3)
“negligently failed to recommend or install a pressure-relieving
device to prevent damage from excess water pressures.”
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Defendant and Unifour filed motions for summary judgment in
April 2013. Both parties were awarded summary judgment in May
2013. Plaintiff timely appealed from both orders granting
summary judgment but subsequently withdrew its appeal as to
Unifour.
Discussion
I. Summary Judgment for Defendant
Plaintiff argues that summary judgment was inappropriate
where genuine issues of material fact existed as to whether: (1)
defendant was negligent in its operation of the municipal water
system, and (2) plaintiff was contributorily negligent. Because
plaintiff has failed to carry its burden of establishing a
standard of care for defendant’s alleged professional
negligence, we affirm the trial court’s order granting summary
judgment in defendant’s favor.
“This Court reviews orders granting summary judgment de
novo.” Foster v. Crandell, 181 N.C. App. 152, 164, 638 S.E.2d
526, 535 (2007). Summary judgment is appropriate “only when the
record shows that there is no genuine issue as to any material
fact and that any party is entitled to a judgment as a matter of
law.” In re Will of Jones, 362 N.C. 569, 573, 669 S.E.2d 572,
576 (2008) (internal quotation marks omitted). The burden of
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proof rests with the movant to show that summary judgment is
appropriate. Development Corp. v. James, 300 N.C. 631, 637, 268
S.E.2d 205, 209 (1980). We review the record in the light most
favorable to the non-moving party. Caldwell v. Deese, 288 N.C.
375, 378, 218 S.E.2d 379, 381 (1975).
Because “the standard of reasonable care should ordinarily
be applied by the jury under appropriate instructions from the
court,” summary judgment is rarely an appropriate remedy in
cases of negligence or contributory negligence. Thompson v.
Bradley, 142 N.C. App. 636, 641, 544 S.E.2d 258, 261 (2001)
(internal quotation marks omitted). However, summary judgment
is appropriate in a cause of action for negligence where “the
forecast of evidence fails to show negligence on defendant’s
part, or establishes plaintiff’s contributory negligence as a
matter of law.” Stansfield v. Mahowsky, 46 N.C. App. 829, 830,
266 S.E.2d 28, 29 (1980). “[A] [p]laintiff is required to offer
legal evidence tending to establish beyond mere speculation or
conjecture every essential element of negligence, and upon
failure to do so, [summary judgment] is proper.” Young v. Fun
Services-Carolina, Inc., 122 N.C. App. 157, 162, 468 S.E.2d 260,
263 (1996) (internal quotation marks omitted).
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Although the complaint states only a claim for
“negligence,” this cause of action is actually one for
“professional negligence” because plaintiff is alleging
negligent performance by defendant in its professional capacity
as the operator of a municipal water system. See Michael v.
Huffman Oil Co., 190 N.C. App. 256, 271, 661 S.E.2d 1, 11 (2008)
(characterizing negligence action brought against the City of
Burlington for failure to warn, failure to investigate, and
negligent misrepresentation as professional negligence where the
defendant was installing a potable waterline). Defendant
admitted in its answer that it “has all of the corporate powers
as set forth in [the North Carolina General Statutes for
municipal corporations][.]” When a municipal corporation
operates a system of waterworks and sells water for private
consumption and use, “it is acting in its proprietary or
corporate capacity and is liable for injury or damage resulting
from such operation to the same extent and upon the same basis
as a privately owned water company would be.” Mosseller v.
Asheville, 267 N.C. 104, 107, 147 S.E.2d 558, 561 (1966).
In a professional negligence action, the plaintiff bears
the burden of showing: “(1) the nature of the defendant’s
profession; (2) the defendant’s duty to conform to a certain
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standard of conduct; and (3) a breach of the duty proximately
caused injury to the plaintiffs.” Huffman Oil Co., Inc., 190
N.C. App. at 271, 661 S.E.2d at 11 (emphasis and internal
quotation marks omitted). “Where common knowledge and
experience of the jury is [not] sufficient to evaluate
compliance with a standard of care,” the plaintiff is required
to establish the standard of care through expert testimony. Id.“The standard of care provides a template against which the
finder of fact may measure the actual conduct of the
professional. The purpose of introducing evidence as to the
standard of care in a professional negligence lawsuit is to see
if this defendant’s actions lived up to that standard[.]”
Associated Indus. Contr’rs, Inc. v. Fleming Eng'g, Inc., 162
N.C. App. 405, 410, 590 S.E.2d 866, 870 (2004) (internal
quotation marks omitted), aff'd, 359 N.C. 296, 608 S.E.2d 757(2005). If the plaintiff fails to establish the proper standard
of care through expert testimony in a professional negligence
claim, summary judgment for the defendant is proper. Huffman
Oil Co., 190 N.C. App. at 271, 661 S.E.2d at 11.
This Court has previously held that the “common knowledge”
exception to the requirement that the standard of care be
established by expert testimony applies either when the actions
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are “of such a nature that the common knowledge of laypersons is
sufficient to find the standard of care required, a departure
therefrom, or proximate causation.” Associated Indus.
Contractors, Inc., 162 N.C. App. at 411, 590 S.E.2d at 871. In
Associated Indus. Contractors, Inc., this Court held that a
surveyor’s actions fell within the “common knowledge” exception
because a trier of fact could adequately determine whether the
surveyor correctly measured ninety-degree angles in its design
of a rectangular building site. Id. at 411-12, 590 S.E.2d at
871. It noted that “where . . . the service rendered does not
involve esoteric knowledge or uncertainty that calls for the
professional’s judgment, it is not beyond the knowledge of the
jury to determine the adequacy of the performance.” Id.(citation and quotation omitted).
Here, plaintiff asserted that defendant was negligent in
three ways: (1) failing to ensure that water pressure did not
exceed reasonable levels; (2) failing to install a “loop” system
in its municipal water distribution system to prevent excessive
pressures at the terminal ends of the water line; and (3)
failing to install or recommend that the Club install a
pressure-relieving device. Unlike the measuring of ninety-
degree angles in Associated Indus. Contractors, Inc., the
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alleged wrongdoing of defendant here required the exercise of
professional judgment regarding a “reasonable” level of water
pressure in a municipal water system, the skill needed to
install a “loop” system, and the expertise to install or
recommend installing a pressure-relieving device at the terminal
ends of the system. Because these claims could not be properly
evaluated with the “common knowledge and experience” of the
jury, plaintiff bore the burden of producing expert testimony to
establish the proper standard of care to which defendant should
have been held. See Huffman Oil Co., Inc., 190 N.C. App. at
271, 661 S.E.2d at 11.
Plaintiff failed to meet this burden. Chang, plaintiff’s
sole expert witness, specifically testified that he had not
studied defendant’s facility, did not know what type of water
distribution system defendant used, had no experience in
designing or running a municipal water system, and did not know
of anything defendant may have done to create an increase in
water pressure. Busic, the Club’s General Manager, testified
that he had no experience or training in the field of plumbing
at all. Although Chang and Busic testified that the six-inch
PVC pipe installed by Crawford burst due to internal pressure,
neither could identify what a reasonable municipal corporation
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providing water to the Club would do given the facts of this
case. Nor could they identify any action taken by defendant
that might have caused a sudden increase in water pressure.
Thus, plaintiff essentially argues that because defendant
could have prevented the six-inch PVC piping erroneously
installed into the Club’s sprinkler system from bursting, they
necessarily breached a duty owed to the Club by failing to do
so. However, absent expert testimony establishing the standard
of care that defendant owed the Club, plaintiff failed to
provide a context to assess whether defendant’s conduct differed
from what it should have done. See Associated Indus.
Contractors, Inc., 162 N.C. App. at 410, 590 S.E.2d at 870.
Thus, by leaving the standard of care unresolved, plaintiff
failed to “offer legal evidence tending to establish beyond mere
speculation or conjecture every essential element of
negligence[.]” Fun Services-Carolina, Inc., 122 N.C. App. at
162, 468 S.E.2d at 263. In other words, “without evidence of
the applicable standard of care, [plaintiff] [has] failed to
establish a prima facie claim for professional negligence.”
Huffman Oil Co., 190 N.C. App. at 272, 661 S.E.2d at 11-12.
Accordingly, summary judgment for defendant was proper, and we
need not address defendant’s alternative argument on appeal—that
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plaintiff was contributorily negligent. Id.; see also Huffman
Oil Co., 190 N.C. App. at 271, 661 S.E.2d at 11 (holding that
summary judgment in favor of the defendant City of Burlington
was proper where the plaintiff failed to provide expert
testimony establishing the applicable standard of care).
Conclusion
Because plaintiff failed to establish a standard of care in
its professional negligence claim, we affirm the trial court’s
grant of summary judgment in defendant’s favor.
AFFIRMED.
Judges McGEE and ELMORE concur.