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Saddler and Washington v. Alaska Marine Lines (7/30/93), 856 P 2d 784
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Notice: This is subject to formal
correction before publication in the Pacific
Reporter. Readers are requested to bring
typographical or other formal errors to the
attention of the Clerk of the Appellate
Courts, 303 K Street, Anchorage, Alaska
99501, in order that corrections may be made
prior to permanent publication.
THE SUPREME COURT OF THE STATE OF ALASKA
DONALD SADDLER, BETTY SADDLER )
and ANTHONY WASHINGTON, ) Supreme Court File No. S-5235
) Superior Court File No.
Appellants, ) 4BE-90-60 Civil
)
v. ) O P I N I O N
)
ALASKA MARINE LINES, INC., ) [No. 3989 - July 30, 1993]
)
Appellee. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Fourth Judicial District,
Bethel, Jane F. Kauvar, Judge pro tem.
Appearances: Frank J. Schlehofer, Law
Office of William G. Azar, P.C., Anchorage,
for Appellants. L. G. Berry, Robertson,
Monagle & Eastaugh, Anchorage, for Appellee.
Before: Moore, Chief Justice,
Rabinowitz, Burke, Matthews, and Compton,
Justices.
MOORE, Chief Justice.
Donald Saddler and Anthony Washington, employees of
Knik Construction, Inc. (Knik), were injured when a tank they
were heating exploded. The tank contained one type of asphalt
paving material; they mistakenly believed it contained another.
They sued Alaska Marine Lines (AML), the common carrier who had
pumped both materials into different empty tanks, on several
theories. The superior court granted summary judgment in favor
of AML on all claims. Saddler and Washington appealed the grant
of summary judgment on two claims: strict products liability and
negligence. We affirm the grant on the strict products liability
claim, and reverse as to negligence.
I. FACTS AND PROCEEDINGS
In 1989, Knik had an asphalt paving project at Bethel
Airport. Knik employed Saddler and Washington1 as laborers on
the project. Their jobs were to heat and pump an asphalt paving
material, AC-5. They were injured when a closed tank they were
heating exploded. Apparently, the tank did not contain AC-5.
Instead, it contained another paving material, CSS-1. CSS-1 has
a much lower boiling point than AC-5.
Knik had ordered both the AC-5 and the CSS-1 from
Chevron in Washington State. AML, a common carrier who
transports freight to Alaska, was one of the designated
delivering carriers of this shipment. Another carrier
transported the materials from Chevron to AML's dock in
Washington.
When the shipment arrived at AML's docks, AML pumped
the materials into empty tanks owned by Knik. At the time the
tanks were filled, AML was storing 25 to 50 of Knik's empty tanks
on AML's dock. These tanks consisted of two types.2 One type
was square, with a 2500 gallon capacity. The other was round,
with a 5000 gallon capacity. On this order, AML filled all of
the available round containers with CSS-1 and placed AC-5 only in
square containers. It also filled one square 2500 gallon tank,
tank 03, with CSS-1. Tank 03 was the tank involved in the
explosion. Prior to pumping, one of the empty round 5000 gallon
containers AML was storing for Knik was rejected by the
inspector. This container would have held the amount of CSS-1
pumped into tank 03.
The parties dispute whether AML was supposed to pump
only CSS-1 into round containers. In his affidavit, Saddler
stated that after his injury, someone told him CSS-1 was supposed
to be shipped in the round containers, not square ones. Saddler
also relies on the fact that during this shipment, CSS-1 indeed
was pumped only into round containers, with the exception of tank
03, which he alleges replaced the damaged round container.
Finally, Saddler notes that the bill of lading for this order
mistakenly represented that tank 03 contained AC-5, not CSS-1.
AML disputes the contention that it was supposed to
pump CSS-1 only into round containers. Its representative stated
that all types of asphalt materials were shipped in the square
tanks. AML also contended that large shipments to Bethel
required the use of all available tanks. Additionally, the Knik
project manager stated that Knik had no requirement that a
particular product be shipped in a particular type of tank.
The Knik manager also stated that the contents of each
tank are labelled on the tank. Saddler alleges tank 03 was
inadequately labelled because it was labelled on only two out of
four sides. Finally, Saddler alleges that the labels should have
included a warning about the boiling point of CSS-1.
Saddler brought suit against AML, alleging strict
products liability due to failure to warn and
negligence/negligent failure to warn.3 AML moved for summary
judgment on the products liability claim on the grounds it
neither manufactured, distributed nor sold a product. It moved
for summary judgment on the negligence claim on the grounds that
it owed no duty to Knik's employees and that no causal connection
existed between the plaintiffs' allegations and the accident.
The superior court granted AML's motion on all claims.
II. DISCUSSION
A. Standard of Review
In reviewing a grant of summary judgment, we
must determine whether a genuine issue of material fact
exists and whether the moving party is entitled to
judgment as a matter of law. Thorstenson v. ARCO
Alaska, Inc., 780 P.2d 371, 374 (Alaska 1989). If the
moving party establishes prima facie that it is
entitled to judgment as a matter of law, the party
opposing summary judgment must demonstrate that there
exists a genuine issue of material fact to be
litigated. Id. (quoting Wassink v. Hawkins, 763 P.2d
971, 973 (Alaska 1988)). In reviewing the grant of a
motion for summary judgment we must take a view of the
facts that most favors the nonmoving party. Loyal
Order of Moose, Lodge 1392 v. International Fidelity
Ins. Co., 797 P.2d 622, 628 (Alaska 1990). When the
superior court's order of summary judgment is without a
statement of reasons, we will presume the superior
court ruled in the movant's favor on all issues.
"Accordingly, the summary judgment should be reversed
only if no ground asserted supports the trial court's
decision." Reed v. Municipality of Anchorage, 741 P.2d
1181, 1184 (Alaska 1987).
B. Is AML Subject to Strict Products Liability?
AML argues that because it is a common carrier, it
should not be subject to strict products liability. Saddler
argues that AML is a "repackager"and should be strictly liable
as such. AML is correct.
On the issue of strict products liability, we have
adopted the Restatement (Second) of Torts 402A (1965), with
some exceptions.4 Swenson Trucking & Excavating, Inc. v.
Truckweld Equip. Co., 604 P.2d 1113, 1116 (Alaska 1980).
According to the Restatement, the following are subject to strict
products liability: sellers, manufacturers, wholesale or retail
dealers and distributors. Restatement (Second) of Torts
402(A), cmt. f (1965). Additionally, "strict liability applies
to products, not services." Swenson Trucking, 604 P.2d at 1116-
17 (repairer of truck ram assembly not held strictly liable as a
matter of law).
Despite Saddler's arguments to the contrary, AML
provided only a service to Knik. It performed the service of
storing Knik's empty asphalt containers on its dock in
Washington. When a shipment of asphalt materials was delivered
from Chevron, the manufacturer, AML performed the service of
pumping the asphalt into the containers. Finally, AML performed
the service of shipping the filled containers to Alaska. At no
time did AML sell, manufacture, deal or distribute the asphalt
products.5 Therefore, AML is not subject to strict products
liability as a matter of law.
C. Was Summary Judgment Inappropriate on the Question of
AML's Negligence?
From the record, it appears the grounds for the grant
of summary judgment in favor of AML were that AML owed Saddler no
duty and that AML committed no negligent act which caused
Saddler's injuries.
In Swenson Trucking, this court restated its position
that
As a general rule, issues of
negligence are generally not susceptible to
summary determination, but should be resolved
by trial in the ordinary manner. The reason
for this rule is:
[B]ecause of the elusive
nature of the concept of
negligence, the determination of
the existence of which requires the
forming of a judgment as to the
reasonableness of the conduct of
the parties in the light of all the
circumstances of the case. If
reasonable minds could draw
different inferences and reach
different conclusions from the fact
the issue must be reserved for
trial.
604 P.2d at 1118 (quoting Webb v. City & Borough of Sitka, 561
P.2d 731, 735 (Alaska 1977)).
Saddler advances three theories to support his position
that AML owed him a duty of care. The first is the duty owed by
bulk suppliers under the Restatement (Second) of Torts 388
(1965) and case law. The second is the duty owed under the
Restatement (Second) of Torts 324A (1965) by one who
negligently performs an assumed duty. The third is a duty of
care based on policy considerations, using the factors set forth
in D.S.W. v. Fairbanks N. Star Borough Sch. Dist., 628 P.2d 554
(Alaska 1981).
1. Duty Owed by Bulk Suppliers
Saddler argues that AML owed him the duty owed by bulk
suppliers, either under the Restatement (Second) of Torts 388,
Chattel Known to be Dangerous for Intended Use,6 or case law.7
Saddler argues this duty should exist for policy reasons even if
we determine that AML is not a bulk supplier.
Saddler's arguments are unpersuasive. As he notes in
his brief, "supplier" already is defined quite broadly. It
includes lessors, bailors, repairers, donors and lenders.
Restatement (Second) of Torts 388 cmt. c (1965). AML is none
of these; it is a common carrier hired to perform a service.
Common carriers should not be subjected to strict products
liability; nor should they be included within the definition of
bulk suppliers. We therefore conclude that AML does not owe
Saddler the duty owed by bulk suppliers.
2. Duty Owed Under the Restatement (Second) of Torts
324A
Saddler next alleges AML owes him the duty of care set
forth in the Restatement (Second) of Torts 324A, Liability to
Third Person for Negligent Performance of Undertaking (1965). It
reads:
One who undertakes, gratuitously or for
consideration, to render services to another
which he should recognize as necessary for
the protection of a third person or his
things, is subject to liability to the third
person for physical harm resulting from his
failure to exercise reasonable care to
protect his undertaking, if
(a) his failure to exercise
reasonable care increases the risk of such
harm, or
(b) he has undertaken to perform a
duty owed by the other to the third person,
or
(c) the harm is suffered because of
reliance of the other or the third person
upon the undertaking.
City of Kotzebue v. McLean, 702 P.2d 1309, 1313 n.4 (Alaska 1985)
(quoting Restatement (Second) of Torts 324A (1965)).
AML argues that it did not undertake to perform any
services for the protection of Saddler. Drawing all reasonable
inferences in favor of Saddler, as we must in reviewing a grant
of summary judgment, Swenson Trucking, 604 P.2d at 1116, AML is
incorrect.
It is reasonable to infer that AML undertook to perform
several services for Knik which AML should have recognized were
necessary to protect Saddler. Construing the facts in the light
most favorable to Saddler, AML undertook to pump only AC-5 into
square tanks.8 AML also undertook to label tank 03, the square
tank that contained CSS-1, labelling two sides of that tank. One
reasonably could infer that such labelling was inadequate,
especially if AML undertook to pump only AC-5 into the square
tanks.9 Finally, AML undertook to note the contents of the tanks
on the bill of lading which accompanied the shipment; however,
AML mistakenly noted on the bill of lading that tank 03 contained
AC-5.10 One reasonably could infer that the bill of lading error
compounded the pumping and labelling errors, causing Saddler's
injuries.11
Because material issues of fact exist concerning AML's
duty under Restatement (Second) 324A, summary judgment in favor
of AML was inappropriate. We reverse and remand for the
determination of the duty and causation factual issues.
3. Duty Based on Policy Considerations
Saddler finally argues that AML owed him
a duty based on the policy considerations set
forth in D.S.W. v. Fairbanks N. Star Borough Sch.
Dist., 628 P.2d 554 (Alaska 1981).12 Because we
decide that material issues of fact exist
concerning whether AML had a duty under the
Restatement (Second) of Torts 324A, we need not
consider whether a duty also exists based on
policy considerations.
III. CONCLUSION
AML is a common carrier. It provides only a
service; it neither sells, manufactures nor distributes a
product. Therefore, AML is not subject to strict products
liability, nor does it owe the duty of care owed by bulk
suppliers. Material issues of fact exist as to whether AML
owed Saddler a duty of care under the Restatement (Second)
of Torts 324A, the duty owed by performing an assumed
duty. We reverse the grant of summary judgment in favor of
AML on Saddler's negligence claim, and remand for a trial to
resolve the duty and causation factual issues.
AFFIRMED in part, REVERSED and REMANDED in part.
_______________________________
1. Saddler's and Washington's cases were consolidated.
Betty Saddler, the wife of Donald Saddler, is also a party based
on her loss of consortium claim. For the sake of convenience,
all three plaintiffs collectively are called "Saddler."
2. A third type of tank, containing 2000 gallons, also
existed. Whether Knik owned 2000 gallon tanks is unclear from
the record; however, this type of tank was not involved in this
incident.
3. Saddler and Washington also alleged breach of express
and implied warranties and defective product design. They do not
appeal the entries of summary judgment on these claims.
4. For example, Alaska has rejected the requirement that
the product be "unreasonably dangerous." Swenson Trucking, 604
P.2d at 1116 n.5.
5. The Restatement (Second) of Torts 402A
applies to any person engaged in the
business of selling products for use or
consumption. It therefore applies to any
manufacturer of such a product, to any
wholesale or retail dealer or distributor . .
. .
Restatement (Second) of Torts 402A cmt. f (1965).
6. Section 388 of the Restatement (Second) of Torts (1965)
states:
One who supplies directly or through a
third person a chattel for another to use is
subject to liability to those whom the
supplier should expect to use the chattel
with the consent of the other or to be
endangered by its probable use, for physical
harm caused by the use of the chattel in the
manner for which and by a person for whose
use it is supplied, if the supplier
(a) knows or has reason to know
that the chattel is or is likely to be
dangerous for the use for which it is
supplied, and
(b) has no reason to believe that
those for whose use the chattel is supplied
will realize its dangerous condition, and
(c) fails to exercise reasonable
care to inform them of its dangerous
condition or of the facts which make it
likely to be dangerous.
7. Saddler cites several cases that discuss the bulk sales
doctrine. This doctrine sometimes provides bulk product
manufacturers a defense in failure to warn products liability
cases. See Lakeman v. Otis Elevator Co., 930 F.2d 1547, 1551
(11th Cir. 1991); Rivers v. AT&T Technologies, Inc., 554 N.Y.S.2d
401, 403-04 (N.Y. Sup. Ct. 1990); Groll v. Shell Oil Co., 196
Cal. Rptr. 52, 54-55 (Cal. App. 1983). From these cases, Saddler
infers a duty to warn owed by "repackagers"; however, this duty
is inapplicable to AML, a common carrier outside the chain of
distribution.
8. From the record, a reasonable jury could infer that AML
undertook to pump only AC-5 into square tanks either as a
contractual duty or as a customary practice. A material issue of
fact exists concerning this issue.
9. Whether the notice was adequate and whether any
inadequacy in the notice provided was connected causally to
Saddler's injury are material issues of fact. Prince v.
Parachutes, Inc., 685 P.2d 83, 89-90 (Alaska 1984).
10. Compare Matomoco Oil Co., Inc. v. Arctic Mechanical,
Inc., 796 P.2d 1336, 1339-40 (Alaska 1990).
11. Whether the bill of lading error causally was connected
to Saddler's injury is a material issue of fact.
12. The factors are (1) the foreseeability of harm to the
plaintiff, (2) the degree of certainty the plaintiff suffered
injury, (3) the closeness of the connection between the
defendant's conduct and the plaintiff's injury, (4) the moral
blame attached to the defendant's conduct, (5) the policy of
preventing future harm, (6) the extent of the burden to the
defendant and consequences to the community of imposing the duty,
and (7) the availability, cost and prevalence of insurance for
the risk. D.S.W., 628 P.2d at 555.
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