Esparza v. Skyreach Equipment, Inc.
Court of Appeals Division I
State of Washington
Opinion Information Sheet
Docket Number: 43379-2-I
Title of Case: Matt Esparza, Respondent
v.
Skyreach Equipment, Inc., Appellant
File Date: 12/26/2000
SOURCE OF APPEAL
----------------
Appeal from Superior Court of King County
Docket No: 96-2-28794-6
Judgment or order under review
Date filed: 09/03/1998
Judge signing: Hon. Robert S. Lasnik
JUDGES
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Authored by Faye C. Kennedy
Concurring: C. Kenneth Grosse
H. Joseph Coleman
COUNSEL OF RECORD
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Counsel for Appellant(s)
Daniel Gandara
Vandeberg Johnson PS
600 University St
Seattle, WA 98101-1192
Andrew L. Seiple
777 106th Ave NE
Bellevue, WA 98004
Counsel for Respondent(s)
William S. Bailey
PO Box 20397
Suite 1300
Seattle, WA 98102-
Dan L. Larson
Attorney At Law
2245 32nd Ave. W.
P.O. Box 99061
Seattle, WA 98199
Charles K. Wiggins
Attorney At Law
241 Madison Ave N
Bainbridge Is, WA 98110
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
MATT ESPARZA, )
) NO. 43379-2-1
Respondent, )
) DIVISION ONE
v. )
)
SKYREACH EQUIPMENT, INC., a ) PUBLISHED OPINION
Washington Corporation, )
)
Appellant, )
)
WILLIAM ESPY, DEBORA ESPY, and )
Their Marital Community; LEONETTA )
ESPY and ADINA ESPY, both minors, ) PUBLISHED OPINION
By and through their father as their legal )
Representative, )
)
Plaintiffs. ) FILED
KENNEDY, J. -- Matt Esparza was in a manlift painting a ship when the
manlift tipped over, causing him to fall approximately 50 feet to a steel
dry dock deck and injuring him severely. Esparza sued Skyreach Equipment,
Inc., the company that rented the manlift to his employer, for damages
under the theory that Skyreach negligently failed to inspect and test a
safety component on the manlift that would have prevented the tip-over if
it had been working properly. The jury returned a verdict in favor of
Esparza. Skyreach appeals the trial court's (1) denial of its motion to
quash a Notice of Trial Attendance to Skyreach's president; (2) admission
of testimony from two expert witnesses; (3) denial of its motion for a
judgment as a matter of law on the issue of proximate cause; (4) refusal to
allow the jury to consider the allocation of fault to the manlift's
manufacturer, JLG Industries, Inc.; (5) order striking the jury's
allocation of fault to Todd Shipyards, Esparza's employer; and (6) denial
of Skyreach's motion to convert the jury's award of future economic damages
to a stream of periodic payments. We affirm all but one of the challenged
rulings. The trial court erred by refusing to allow the jury to consider
allocation of fault to JLG Industries, Inc., on one of the product
liability theories argued below, i.e., that adequate warnings or
instructions were not provided after the product was manufactured, where
the manufacturer learned or should have learned about a danger connected
with the product after it was manufactured, and a reasonably prudent
manufacturer would have issued such warnings or instructions. Skyreach is
entitled to a new trial, not as to its own liability, but as to whether any
portion of the fault for Esparza's injury should be allocated to the
manufacturer of the manlift.
FACTS
On October 2, 1996, Matt Esparza, a Todd Shipyards employee, was in a
manlift painting a ship when the manlift tipped over, causing him and the
operator of the manlift, William Espy, to fall approximately 50 feet to a
steel dry dock deck.1 Later, it was discovered that the manlift's circuit
cards had been damaged by an excessive dose of electrical current, causing
the 'load management system' (LMS) to fail to automatically stop further
extension of the boom before the manlift could tip over. As a
result of the fall, Esparza suffered severe injuries to his head, legs,
foot, and ankle and is unable to return to the type of work he did before
the fall. Todd Shipyards compensated Esparza under the federal Longshore
and Harbor Workers' Compensation Act (LHWCA) for his injuries.
Esparza sued Skyreach Equipment, Inc., the company that rented the
manlift to Todd Shipyards, for damages. Esparza claimed, inter alia, that
Skyreach failed to inspect, test, and maintain a safety component on the
manlift. In Skyreach's answer to Esparza's complaint, it raised the
affirmative defense that Esparza's injuries were proximately caused by JLG
Industries, Inc., the manufacturer of the manlift, and Todd Shipyards,
Esparza's employer.
Before trial, Skyreach moved to quash a Notice of Trial Attendance
that Esparza sent to Barry Weaver, Skyreach's Canadian president and owner.
The trial court denied this motion, thereby requiring Weaver to attend
trial when he was scheduled to testify.
After the parties had presented all their evidence to the jury,
Skyreach moved for judgment as a matter of law because it maintained that
Esparza had failed to present evidence on the issue of proximate cause.
But the trial court denied this motion. The court then prohibited Skyreach
from arguing that JLG Industries, Inc., was a nonparty entity to which the
jury could allocate fault because the evidence did 'not establish that the
machine was defective either in design or {that} there was anything
negligent about it.' Report of Proceedings (6/10/98) at 27.
The jury returned a verdict in favor of Esparza, allocating 67 percent
of the fault to Skyreach and 33 percent to Todd Shipyards, and awarding
$393,147.25 in damages including $137,285 in future economic damages to
Esparza. Thereafter, the trial court struck the jury's allocation of fault
to Todd Shipyards, in accordance with the policies behind the federal
LHWCA. The court also denied Skyreach's post-verdict motion to convert the
jury's award of future economic damages to a stream of periodic payments
under RCW 4.56.260 because Skyreach failed to notify Esparza of its
intention to request such relief before the jury returned its verdict.
Skyreach appeals. We will describe the relevant evidence in more detail as
we discuss the issues, in order to clarify the bases for our opinion.
DISCUSSION
Issue 1: Did the trial court err by denying Skyreach's motion to quash the
Notice of Trial Attendance that Esparza sent to Skyreach's president in
light of the president's contention that he had no personal knowledge of
the circumstances surrounding Esparza's fall or of the day-to-day
operations of Skyreach's Seattle office, and that requiring the president
who lives in Alberta, Canada to attend the trial was burdensome and
unnecessary?
Skyreach maintains that the trial court erred by requiring Barry
Weaver, Skyreach's president and owner, to attend and testify at this trial
in light of his declaration averring that he had no personal knowledge of
the circumstances surrounding Esparza's fall or of the day-to-day
operations of Skyreach's Seattle office. It also maintains that requiring
Weaver who lives in Alberta, Canada to attend the trial was burdensome and
unnecessary. In response, Esparza contends that Weaver could, and did,
provide relevant evidence with respect to corporate policies regarding
safety and training. 2
'{U}nder CR 43(f)(1), nonresident parties and their managing agents
may be 'compelled' to attend trial in Washington by service of a notice to
attend on local counsel.' Campbell v. A. H. Robins Co., Inc., 32 Wn. App.
98, 107, 645 P.2d 1138 (1982). CR 43(f)(1) states that a 'party, or . . .
an officer, director, or other managing agent . . . of a public or private
corporation, partnership or association which is a party to an action or
proceeding may be examined at the instance of any adverse party.' The rule
further provides that for good cause shown, the trial court may make orders
for the protection of the party or managing agent to be examined in the
manner prescribed by CR 39(b). That rule, in turn, allows the court, upon
motion and with appropriate procedural protections, to order that the
witness be allowed to testify by telephone or videotape, subject to the
provisions of CR 32. 'Failure to attend after notice to local counsel may
. . . result in a contempt order against a party, even where the party is
beyond the reach of a subpoena.' Campbell, 32 Wn. App. at 107.
We reject Skyreach's argument that the trial court should not have
required Weaver to attend trial because doing so was unduly burdensome.
Skyreach points to nothing in the record indicating that it asked the court
to allow Weaver to testify by telephone or videotape in order to reduce the
alleged burden of his attendance at trial. Moreover, the trial court
ordered that Weaver need only be present for his own testimony, and not
throughout the trial, thus reducing such burden as may have existed.
Further, the record reflects that Weaver testified about Skyreach's
obligations under contracts between Skyreach and Todd Shipyards, Skyreach's
safety procedures, and Skyreach's training of its employees. Thus, despite
the fact that Weaver had no personal knowledge of the circumstances
surrounding Esparza's fall or of the day-to-day operations of Skyreach's
Seattle office, he was able to communicate to the jury relevant information
about Skyreach's contractual obligations and safety and training policies.
Thus, we need not decide Skyreach's contention that CR 43(f)(1) contains an
implicit requirement that an adverse party desiring to examine an officer,
director or managing agent make an affirmative showing of necessity. But
see Oakview New Lenox Sch. Dist. v. Ford Motor Co., 378 N.E.2d 544, 547-48
(Ill. App. 1978) (holding that a trial court erred by requiring the
attendance of a corporate officer under a similar court rule where the
officer had no relevant information whatsoever).
Issue 2: Did the trial court abuse its discretion by admitting opinions
from two experts on the issues of defective design and causation because
these experts were not qualified to render such opinions?
Skyreach maintains that the trial court abused its discretion by
admitting testimony from two expert witnesses. Specifically, Skyreach
contends that Richard Leonard's opinion that the manlift's circuit cards
were not defectively designed was outside his area of expertise. Skyreach
also maintains that Steven Forgas was not qualified to testify that the
manlift's circuit boards did not fail because of an induced current or
because of a malfunctioning voltage regulator, and that the manlift, if
properly tested and maintained, would not have failed within a short time
after such servicing, absent abnormal operation.
'If scientific, technical, or other specialized knowledge will assist
the trier of fact to understand the evidence or to determine a fact in
issue, a witness qualified as an expert by knowledge, skill, experience,
training, or education, may testify thereto in the form of an opinion or
otherwise.' ER 702. 'But the expert testimony of an otherwise qualified
witness is not admissible if the issue at hand lies outside the witness'
area of expertise.' State v. Farr-Lenzini, 93 Wn. App. 453, 461, 970 P.2d
313 (1999). This court reviews the trial court's admission or rejection of
expert testimony for an abuse of discretion. State v. Stenson, 132 Wn.2d
668, 701, 715, 940 P.2d 1239 (1997), cert. denied, 523 U.S. 1008 (1998).
In this case, when Leonard a licensed civil and structural engineer
with 23 years of experience with manlifts was asked if there was 'any
design defect in this manlift that contributed to this accident,' he
responded, '{T}here was no design defect, to my knowledge.' Report of
Proceedings (5/28/98) at 140-41. Nonetheless, Leonard admitted that he did
not know what caused the manlift's circuit boards to fail because he was
not asked to test the circuit boards. Leonard also agreed that an
electrical engineer would be the appropriate person to perform such a test
and Skyreach called an electrical engineer to testify with respect to the
circuit boards. Contrary to Skyreach's contentions, Leonard never
testified that the manlift's circuit cards were not defectively designed,
but only that, so far as he knew, there was no design defect with respect
to the manlift generally. Because Leonard did not testify that the design
of the circuit boards was not defective, and specifically disavowed any
knowledge or opinion with respect to that question, his testimony was not
outside of his area of expertise. We conclude that the trial court did
not abuse its discretion by admitting it at trial.
The other expert testimony that Skyreach challenges is from Forgas,
the product safety and reliability director for JLG Industries, Inc., the
manlift's manufacturer, who has monitored the safety of the manlifts for 15
years, who has designed aspects of electrical systems on manlifts, who has
investigated accidents like the accident in this case, and who has
supervised preparation of safety manuals and training programs designed to
prevent accidents like the one in this case. Forgas is also his company's
representative to the American National Standards Institute (ANSI), which
is developing the next generation of Institute standards for manlifts like
the one in this case. He personally investigated the cause of this
accident, and testified in considerable detail and without objection to his
findings with respect to the blown-out circuit cards and the resulting
failure of the LMS. When asked if an 'induced current from power cables in
the area' would cause failure of the circuit cards, Forgas testified, over
an objection for lack of a foundation, that he did not 'know of any
occurrences as far as damage to the {manlift's} circuit cards occurring
from being operated around power lines or magnetic fields or electrical
fields{.}' Report of Proceedings (6/2/98) at 206-07. Forgas also
testified that he has investigated accidents where this model of manlift
has actually contacted power lines, and found the LMS to be working fine
afterwards.
Forgas also opined that the 'voltage regulator did not cause the damage to
the {circuit} cards on this machine.' Id. at 208. Then, in response to a
hypothetical scenario in which proper maintenance was performed days
earlier, Forgas testified that the manlift would not have failed absent
abnormal operation:
If a piece of machinery is properly serviced and maintained prior to going
out of rental, everything was checked to make sure it was operating safely
and properly, and by virtue of that the product isn't likely to fail within
a couple of days of being out on the job site unless something unusual
happens from abnormal operation or operation not in accordance with {the
manufacturer's} instructions would cause a failure of a certain part.
Id. at 255. Based on Forgas's experience monitoring the safety of and
designing electrical systems for manlifts and investigating accidents
involving circuit board failures, he was qualified to render opinions on
the possible causes of the manlift's circuit board failure in this case.
We reject Skyreach's argument that because Forgas's engineering degree was
in agricultural engineering rather than electrical engineering, he was not
qualified to testify as he did. Forgas testified that part of his formal
education included electrical engineering courses, and his on-the-job
training and experience over a period of many years provided the trial
court with an ample basis for admitting his testimony. We conclude that
the trial court did not abuse its discretion by admitting Forgas's opinions
at trial.
Issue 3: Did the trial court err by denying Skyreach's motion for a
judgment as a matter of law on the issue of proximate cause because Esparza
failed to present evidence that the excessive dose of electrical current
that damaged the manlift's circuit cards was generated before the day of
the accident?
Skyreach urges this court to 'dismiss {Esparza's} claims for failure
to present evidence of proximate cause' because Esparza presented no
evidence to indicate when the circuit cards on the manlift failed. The
trial court rejected this argument when, at the close of evidence, it
denied Skyreach's motion for judgment as a matter of law on the issue of
proximate cause.
'When reviewing a trial court's decision to deny a motion for judgment
as a matter of law the appellate court applies the same standard as the
trial court.' Sing v. John L. Scott, Inc., 134 Wn.2d 24, 29, 948 P.2d 816
(1997). The judgment as a matter of law rule, CR 50(a), states:
If, during a trial by jury, a party has been fully heard with respect to an
issue and there is no legally sufficient evidentiary basis for a reasonable
jury to find . . . for that party with respect to that issue, the court may
grant a motion for judgment as a matter of law against the party on any
claim . . . that cannot under the controlling law be maintained without a
favorable finding on that issue.
In deciding whether to grant a motion for judgment as a matter of law, the
court must view all conflicting evidence in the light most favorable to the
nonmoving party and determine whether the proffered result is the only
reasonable conclusion. Hollmann v. Corcoran, 89 Wn. App. 323, 331, 949
P.2d 386 (1997).
Here, Skyreach's contention is that there is no legally sufficient
evidentiary basis for a reasonable jury to find that Skyreach's failure to
test the manlift factually caused Esparza's injuries because Esparza
presented no evidence to indicate that the circuit cards had failed at a
time when Skyreach should have discovered the failure.
Various experts testified that they personally did not know when the
circuit cards failed whether it was moments before the accident or weeks
before the accident, but they unanimously agreed that it was the failure of
the circuit boards that caused the failure of the alarm system that was
intended to alert the manlift operator that tip-over was imminent, and that
caused the automatic shut-down device that would have prevented the
operator from moving the boom of the manlift into tip-over position not to
function. And it was virtually undisputed that Skyreach had not been
regularly testing the load management system, did not do so at its
inspection 5 days before this accident, had not sent its mechanics to the
contractually mandated training programs offered by JLG Industries to teach
them how to perform this vital safety inspection, and that the mechanic who
checked the machine out on the morning of the accident didn't know how to
perform such an inspection didn't even know that he was supposed to do it.
Forgas testified that if the circuit cards were functioning properly 5 days
before the tip-over, they still should have been functioning properly on
the day of the tip-over, unless the manlift had been operated in some
abnormal manner during the intervening time and there was no evidence
presented of any such abnormal operation. In fact, both William Espy, who
was operating the manlift at the time it tipped over, and the man who had
operated it on the previous shift that same day testified that there was
nothing abnormal about their operating procedures. Espy denied getting the
manlift anywhere near any power lines that day, and while another expert
testified that operating near power lines could have caused the circuit
boards to fail, Forgas did not believe that to be the case and the jury was
entitled to believe Forgas or if doubting the validity of his opinion, to
believe Espy that he didn't get close to power lines in any event.
There was also evidence, albeit disputed, from which a rational juror could
have found that the damage to the circuit boards more likely than not
occurred when some welding was done on the manlift because the other
possible reasons for the failure described by the experts did not seem as
likely in view of other evidence and the welding was done before the
inspection that Skyreach should have done but did not do, 5 days before
this accident, and should have done but did not do again on the morning of
the accident. Thus, the record viewed in Esparza's favor reflects a
reasonable inference that proper inspections 5 days before the fall and on
the morning of the fall more likely than not would have revealed that the
manlift's circuit boards, and consequently the automatic shut-off mechanism
(LMS) were not functioning properly at that time. Based on this record, we
agree with the trial court that there was a legally sufficient evidentiary
basis for a finding that Skyreach's negligent failure to properly inspect,
test and maintain the circuit cards proximately caused Esparza's injuries.
See Schooley v. Pinch's Deli Market, Inc., 134 Wn.2d 468, 478, 951 P.2d 749
(1998) (explaining that factual causation is based on 'a physical
connection between an act and an injury'). Accordingly, Skyreach was not
entitled to judgment as a matter of law with respect to proximate cause,
and the trial court did not err in submitted the issue to the jury.
Issue 4: Did the trial court err by refusing to allow the jury to consider
the allocation of fault to the manlift's manufacturer, JLG Industries,
Inc.?
Skyreach contends that the trial court erred by refusing to allow the
jury to allocate fault to the manlift's manufacturer, JLG Industries, Inc.,
in light of one qualified expert's opinion that the circuit cards
aforementioned were defectively designed.
Larry Koler, an electrical engineer, testified that the cards were
defectively designed because each contained a transistor that would blow
out at a very low level of three amps, each was left unprotected by relays
or circuit breakers to prevent external power of substantially greater
amperage from getting to the transistors, and the two cards were connected
so that they could be blown out simultaneously, thus destroying the safety
goal of redundancy. Koler testified further that safety systems that are
truly redundant are never connected and these cards were connected in such
a manner that, if one were blown out by an excessive dose of power, the
other would be blown out, as well. As a result, the two safety systems
that were intended by JLG to be redundant, that is to operate independently
of one another, so that if one mechanism failed the other would still work,
could be blown out simultaneously and in fact, the transistors on both
cards had been blown and that is why both the warning alarm system and the
LMS failed and the manlift tipped over.
Forgas had testified earlier that JLG had redesigned the circuit cards to
add a fuse that acts as a circuit breaker in the event too much power tries
to reach the vulnerable transistor, and then resets itself. Koler
testified that if these newer cards, which JLG designed in response to
customer requests for more reliable cards, had been in place on the
manlift, both cards would not have blown out at once, and the accident
would have been prevented.
Forgas had earlier testified that JLG had not notified its customers of the
availability of the newly designed cards, nor warned them that the older
cards were vulnerable to simultaneous blow-out and that the self-resetting
fuse would obviate that risk. Forgas testified that JLG had not done so
because there had been only one manlift tip-over previous to this accident,
and some 420 manlifts were in the field, so that the machine had a very
reliable safety record. Forgas also testified that JLG's load-management
and warning systems were the best in the industry. But he further
testified that the earlier tip-over accident, 3 years before the accident
in this case, also happened because both circuit cards were not
functioning, and the operator of the machine failed to discover that fact
by checking the safety devices before operating the machine.Although Koler
was allowed to testify that the circuit cards were defectively designed, he
testified that he had no knowledge of industry standards with respect to
manlifts. It was undisputed that the model of manlift here at issue meets
industry standards set by the ANSI although those standards do not specify
standards for the design of circuit cards that are a component of the
manlifts.
In actions claiming fault of two or more entities, the trier of fact
must determine the percentage of total fault attributable to each and every
non-immune entity that caused plaintiff's damages. In a tort case, the
party alleging fault must show that each entity 'caused the claimant's
damages{.}' RCW 4.22.070(1). And to allocate fault to an entity in a
products liability case, the party alleging fault must demonstrate that the
entity's product was 'not reasonably safe as designed{.}' RCW 7.72.030(1).
To demonstrate that an entity's product was 'not reasonably safe as
designed,' a trier of fact may consider whether the entity's product has
complied with legislative or administrative regulatory standards. Soproni
v. Polygon Apartment Partners, 137 Wn.2d 319, 328, 971 P.2d 500 (1999).
But such compliance is not conclusive; rather, it 'is merely relevant
evidence that may be considered by the trier of fact.' Id.
After hearing all the evidence, the trial court concluded that
Skyreach failed to present 'competent evidence . . . that the machine was
defective either in design or {that} there was anything negligent about
it.' Report of Proceedings (6/10/98) at 27; see also id. at 30. The trial
court's decision was based, at least in part, on the fact that Koler 'did
not hold himself out to be an expert in the design of manlifts or what the
industry standards were for manlifts.' Id. at 27. The court reasoned
further that all Skyreach had been able to show was that JLG may have tried
to design a better safety system than others on the market and may have
come up short in reaching its goal, but that does not establish that the
machine was defective in design.
We agree with the trial court's analysis with respect to Skyreach's
theory that the manlift was not reasonably safe as designed, but that was
not Skyreach's only product liability theory below. Washington's product
liability statute, RCW 7.72.030, provides that a product manufacturer is
subject to liability to a claimant if the claimant's harm was proximately
caused by the negligence of the manufacturer (1) because the product was
not reasonably safe as designed or (2) not reasonably safe because adequate
warnings or instructions were not provided. RCW 7.72.030(1).
With respect to the latter basis, a claimant may show that a product is not
reasonably safe because 'adequate warnings or instructions were not
provided after the product was manufactured where a manufacturer learned or
where a reasonably prudent manufacturer should have learned about a danger
connected with the product after it was manufactured.' RCW 7.72.030(1)(c).
That subsection goes on to provide that, in such a case, 'the manufacturer
is under a duty to act with regard to issuing warnings or instructions
concerning the danger in the manner that a reasonably prudent manufacturer
would act in the same or similar circumstances. This duty is satisfied if
the manufacturer exercises reasonable care to inform product users.' Id.
And, under RCW 7.72.030(3), '{i}n determining whether a product was not
reasonably safe {under RCW 7.72.030} the trier of fact shall consider
whether the product was unsafe to an extent beyond that which would be
contemplated by the ordinary consumer.' RCW 7.72.030(3).
Skyreach argued both theories of product liability in the hearing on
Esparza's motion to prohibit Skyreach from arguing that the jury should
allocate fault to JLG Industries under a product liability theory.
Skyreach also proposed jury instructions that contained a verbatim
recitation of the 'adequate warnings or instructions' provisions of RCW
7.72.030(1)(c).
It is not crystal clear from the oral ruling on Esparza's motion that the
trial court focused on this second basis for products liability, for the
court only said that Skyreach had failed to present competent evidence that
the manlift was defectively designed or that 'there was anything negligent
about it.' If by 'it' the trial court meant that Skyreach failed to
present competent evidence that the manufacturer learned or should have
learned about a danger connected with the product after it was
manufactured, and failed to give adequate warnings or instructions about
the danger when a reasonably prudent manufacturer would have issued such
warnings, we respectfully disagree.
JLG's director of product safety and liability, Mr. Forgas, testified that,
in response to customer complaints about reliability of the circuit cards,
JLG developed the self-resetting fuse that prevented excess current from
reaching the transistors that Koler testified were the 'weak link' in the
safety system. Three years before the accident in this case, another
manlift tipped over because both circuit cards had failed, disabling the
load management and warning systems the same kind of failure that resulted
in the accident in this case.
Forgas also testified that part of his duties was to monitor parts
replacements, and that about half the time when customers ordered new
circuit cards they ordered both cards instead of just one of them although
he did not know whether that was because both cards had failed or because
some customers merely wanted to build up their card inventory.
Forgas testified that JLG decided not to issue any warnings or instructions
with respect to replacing the old cards with the newly designed cards
containing the self-resetting fuse because JLG already had the best safety
system on the market and the old cards had proved reliable in the field 420
manlifts in the field and only one previous tip-over accident due to faulty
cards, prior to this one. But Leonard, the civil and structural engineer
with 23 years of experience with manlifts testified that warnings or
instructions with respect to replacing the old cards with the newly
designed cards should have been issued. And Koler testified that if the
manlift in this case had been fitted with the new cards containing the self-
resetting fuse, the surge of current that caused the circuit cards to fail
would, instead, have triggered the circuit breaker, which would have then
re-set itself, preventing the failure of the LMS in this case, thereby
preventing the tip-over.
A product may be reasonably safe as designed but nevertheless not
reasonably safe because of a danger connected with the product that the
manufacturer learned about or should have learned about after the product
was manufactured. See generally Timberline Air Serv., Inc., v. Bell
Helicopter-Textron, Inc., 125 Wn.2d 305, 327-30, 884 P.2d 920 (1994). See
also Hernandez v. Badger Construction Equip. Co., 28 Cal. App. 4th 1791, 34
Cal. Rptr. 2d 732 (1994) (jury's finding of negligence based on failure to
conduct an adequate retrofit campaign may be reconciled with the jury's
finding that there was no design defect in the crane). As our Supreme
Court put it in the Timberline Air Service case, albeit in another context
from this one, '{S}tate tort law duties to warn have the objective of
helping those who use or come into contact with the product to protect . .
. their own safety.' 125 Wn.2d at 327.
The evidence with respect to failure to warn in Timberline Air Service
is similar to the evidence in this case. Timberline sued the manufacturer
of a military helicopter that had been designed in accordance with precise
mandatory government specifications, and there was no dispute that the
design, including the design of the 42-degree gear box and -9 gear was in
compliance with those government specifications. Moreover, the helicopter
was reasonably safe for the military purposes for which it was designed,
and there was no contention that the product had a design defect at all.
Rather, this was a pure failure to warn case.
The government sold the helicopter to Timberline, who placed it in
commercial use for repetitive lifting of heavy logs. The manufacturer knew
by then that the -9 gear was vulnerable to failure after repetitive heavy
lift operations, and knew or easily could have determined who the civilian
owners and operators of the former military helicopters were. After four
crashes of these helicopters due to failure of the -9 gear while the
helicopters were in civilian use for repetitive heavy lifting operations,
the manufacturer notified the FAA about the danger but failed to warn the
civilian owners and operators of the danger and to suggest mitigating
procedures, such as suggesting reduced time between overhauls, suggesting
alternative means of determining flight hours based on repetitive lift
usage, and prescribing a finite life for the -9 gear. The accuracy of
these factual assertions was conceded for purposes of the appeal of the
summary judgment order dismissing Timberline's claim the outcome of the
appeal involved legal issues relating to Washington's statutory government
contractor's defense to a product liability claim. 125 Wn.2d 308-311.
Here, there had been only one previous tip-over of a manlift due to
the failure of both circuit cards, in contrast with four helicopter crashes
as in Timberline, but the new design adding the self-resetting fuse to the
circuit cards had been done in response to customer complaints about
reliability of the cards, and with only 420 manlifts in the field,
notifying the customers of the availability of the new cards and the
resulting improvement in both safety and reliability would seem to have
been relatively easy. See Ayers v. Johnson & Johnson Baby Prods. Co., 117
Wn.2d 747, 751, 763, 818 P.2d 1337 (1991) (affirming a jury verdict in a
failure to warn case in favor of parents and guardian ad litem of a 15-
month old child who suffered irreparable brain damage after aspirating baby
oil; holding that a trier of fact must weigh the likelihood and seriousness
of potential harm against the ability of the manufacturer to provide an
adequate warning; concluding that although likelihood of a baby aspirating
baby oil was low, the potential harm was serious, and placing a warning
label on the bottle of baby oil was relatively easy and inexpensive).
The general rule is that a post-sale duty to warn arises after a
manufacturer has sufficient notice about a specific danger associated with
the product. Michael A. Matula, Manufacturers' Post-Dale Duties in the
1990s, 32 Tort and Ins. Law Journal 87, 105 (citing Patton v. Hutchinson
Wil-Rich Mfg. Co., 861 P.2d 1299, 1314 (Kan. 1993)). Whether the
manufacturer, which is held to the standard of an expert in the field, had
sufficient notice is a factual question, generally to be decided by the
jury. Id. (citing Patton, 861 P.2d at 1315). The most convincing proof
that a manufacturer knew of a dangerous condition associated with its
product is that the manufacturer knew about previous substantially similar
accidents involving the product. Id. at 109. Whether a manufacturer has a
duty to warn is a question of law for the court. Id. at 118 (citing
Ramstad v. Lear Siegler Diversified Holdings Corp., 836 F. Supp. 1511, 1517
(D. Minn. 1993). See also Douglas R. Richmond, Expanding Products
Liability: Manufacturers' Post-Sale Duties to Warn, Retrofit and Recall,
36 Idaho L. Rev. 7, 30, 41 (1999).
We have no difficulty concluding that there was a duty to warn in this
case, so long as a rational trier of fact determines that JLG had or should
have had sufficient notice about the specific danger associated with its
product, namely the danger of both circuit cards failing at once due to a
current surge, for our Legislature has already made that determination.
See RCW 7.72.030(1)(c ) (where a manufacturer learned or a reasonably
prudent manufacturer should have learned about a danger connected with its
product after it was manufactured, the manufacturer is under a duty to act
with regard to issuing warnings).
The danger of both cards failing at once may be relatively low but the
seriousness of the danger is grave, given that the manlift raises workers
up to 110 feet above the ground and the warning devices and automatic shut-
down devices are the only means of preventing the boom from extending into
the tip-over danger zone and here, there is ample evidence from which a
trier of fact could determine that warnings could have been issued with
relative ease.
There is also sufficient evidence from which a trier of fact could
determine that JLG's failure to warn was a proximate cause of Esparza's
injuries in that there is evidence that installation of the newer cards
would have prevented both circuit cards from failing at once.
Skyreach is entitled to a new trial on the question of whether JLG
Industries, Inc., should share in the liability for Esparza's injury, and
if so, by what percentage of fault in comparison to that of Skyreach.
Issue 5: Did the trial court properly strike the jury's allocation of
fault to Todd Shipyards?
After the jury returned its verdict in this case, the trial court struck
the jury's allocation of fault to Esparza's employer, Todd Shipyards, in
accordance with the purposes and policies behind the federal Longshore and
Harbor Workers' Compensation Act (LHWCA) which the trial court correctly
determined to be prompt, full and complete compensation to the injured
worker and to entitle the worker's employer to recover from third party
tort feasors successfully sued by the employee (or from the employee
himself or herself) the full measure of the compensation paid to the
employee under LHWCA, without adjustment due to the comparative fault of
the employer vis- -vis the third party. See Stevedoring Serv. of America,
Inc., v. Eggert, 129 Wn.2d 17, 37, 914 P.2d 737 (1996) (one of the main
purposes of LHWCA ''is to ensure the prompt payment of benefits that may be
necessary to a claimant's survival'' (quoting Phillips v. Marine Concrete
Structures, Inc., 877 F.2d 1231, 1234, (5th Cir. 1989), reh'g granted and
opinion reinstated in relevant part, 895 F.2d 1033 (5th Cir. 1990)). See
also Schreefel v. Okuly, 143 Cal. App.3d 818, 822, 192 Cal. Rptr. 402
(1983) (LHWCA entitles employer to recover benefits paid without adjustment
due to comparative fault of the employer) (citing Edmonds v. Compagnie
Generale Transatlantique, 443 U.S. 256, 271-73, 99 S. Ct. 2753, 61 L. Ed.
2d 521 (1979)).
Skyreach argues that the trial court's deference to the 'presumed federal
policy' behind the LHWCA was error because 'Skyreach was entitled to have
the jury make an allocation of liability to Todd {Shipyards} under RCW
4.22.070.' Appellant's Br. at 36.
RCW 4.22.070 states: 'In all actions involving fault of more than one
entity, the trier of fact shall determine the percentage of the total fault
which is attributable to every entity which caused the claimant's damages
except entities immune from liability to the claimant under Title 51 RCW{,
the Industrial Insurance Act}.' RCW 4.22.070(1). Our Legislature added
the Title 51 RCW entities exception to preserve industrial insurance
employers' ability to recover benefits paid from at-fault parties. Gilbert
H. Moen Co. v. Island Steel Erectors, Inc., 128 Wn.2d 745, 759 n.7, 912
P.2d 472 (1996).
RCW Title 51 expressly does 'not apply . . . to employers and workers for
whom a right or obligation exists under the maritime laws or federal
employees' compensation act for personal injuries or death of such
workers.' RCW 51.12.100(1). See also RCW 51.12.100(4) which provides that
in the event payments are made under Title 51 prior to a final
determination of coverage under the maritime laws, such benefits shall be
repaid by the worker if recovery is subsequently made under the maritime
laws.
Accordingly, absent federal pre-emption, a literal application of RCW
4.22.070(1), which exempts only entities immune from liability under Title
51 RCW, would require us to reinstate the jury's allocation of fault to
Todd Shipyards, because Todd Shipyards is immune under LHWCA, not under
Title 51 even though both statutory schemes preserve employers' rights to
recover benefits paid to injured workers from third-party tort feasors.
We believe this would be an absurd result, and not one that our Legislature
could have intended. 'In interpreting statutory provisions, '{t}he
fundamental objective . . . is to ascertain and carry out the intent of the
Legislature.'' State v. Alvarez, 128 Wn.2d 1, 11, 904, 904 P.2d 754 (1995)
(footnote omitted) (alteration in original). Moreover, this court must
construe statutes to avoid strained or absurd results. State v. Akin, 77
Wn. App. 575, 580, 892 P.2d 774 (1995).
The absurdity of literal application becomes even more apparent when one
considers that one of the purposes of LHWCA's provisions allowing the
employer to recover benefits paid without reduction for the employer's
fault is to prevent double recovery by the worker that same purpose being
apparent from the provisions of RCW 51.12.100 that require the worker to
repay state benefits he or she may have received, if recovery is made under
the maritime laws. See E. P. Paup Co. v. Director, Office of Workers
Compensation Programs, 999 F.2d 1341, 1350 (9th Cir. 1993). Yet, to allow
a third party tort feasor to allocate fault to an injured worker's employer
would restrict the employee's recovery as against the third party without
the worker acquiring any offsetting rights against the employer whose
rights under LHWCA include a subrogation lien against the worker's recovery
from a third party without reduction for the employer's fault. Thus, a
literal application of RCW 4.22.070(1) would result in the injured worker
effectively paying twice once by means of a reduced recovery for fault
allocated to the employer, and a second time when the employer exercises
its subrogation lien against the worker's recovery without reduction for
the employer's fault. See Dodge v. Mitsui Shintaku Ginko K. K. Tokyo, 528
F.2d 669, 672 (9th Cir. 1975); 33 U.S.C.A. sec.sec. 933, 933(b) (1986).
In view of these absurdities, and as an alternative to venturing into the
complex arena of federal preemption analysis, Esparza suggests that we
simply construe RCW 4.22.070(1) to mean that Todd Shipyards is 'immune from
liability to the claimant under Title 51 RCW' within the meaning of RCW
4.22.070(1) because Todd Shipyards is immune under a substantially similar
workers compensation statute, here, LHWCA. As tempting as this invitation
is, we elect to decide the issue on the same basis as the trial court,
namely that the plain language of RCW 4.22.070(1) must give way to the
LHWCA statutory scheme because to allow the jury's allocation of fault to
Todd Shipyards to stand would conflict with the provisions of LHWCA that
permit the employer to exercise a subrogation lien against an injured
worker's recovery from third-party tort feasors without regard to fault of
the employer. The trial court ruled correctly. See Stevedoring Services,
129 Wn.2d at 36 (state law that actually conflicts with federal law is
preempted).
LHWCA enables the injured person to recover compensation for injuries from
the person's employer 'irrespective of fault as a cause for the injury.'
33 U.S.C.A. sec. 904(b) (1986). After compensating the injured person, the
employer is entitled to recover its expenses where the injured person
recovers from an at-fault third party. 33 U.S.C.A. sec. 933. The third
party is not entitled to contribution as against the employer. Dodge, 528
F.2d at 671. To shift the employer's fault to the injured worker by
allocating fault to the employer to reduce the third party's recovery would
be unfair to the worker because the worker would not acquire any offsetting
rights against the employer's subrogation lien on the worker's recovery.
Id. at 672.
That the trial court's ruling was correct becomes even more apparent when
one considers the full meaning of 33 U.S.C.A. sec. 933 those provisions of
LHWCA that implement and preserve the employer's right to recover benefits
and compensation paid under LHWCA for injuries where third persons are
liable. Under subsection (b) of that section, by accepting benefits under
LHWCA, the injured worker assigns to the employer all rights to recover
damages against third-person tort feasors unless the worker commences an
action against the third person within 6 months of accepting benefits.
Under subsections (e)(1) and (2), if the employer commences suit, or
compromises the claim short of suit, the employer may retain an amount
equal to all the expenses of the suit or compromise, including a reasonable
attorney fee, may recover the cost of all benefits actually furnished to
the employee, may recover all amounts paid as compensation to the employee,
may recover the present value of any future compensation and benefits owed
to the employee, and only then must pay any excess over to the injured
worker.
Under subsection (g), on the other hand, if the injured worker timely
commences suit against the third party, the worker cannot settle the claim
for less than the full amount of benefits and compensation he or she is
entitled to under LHWCA except by written agreement with the employer in
advance of such settlement, and if the worker fails to obtain such
agreement but settles anyway, he or she forfeits all rights to any
additional compensation and medical benefits due under the act. And the
same goes for any judgment the injured worker may obtain against the third
party the worker must notify the employer of the judgment or all benefits
due are terminated. And by the provisions of subsection (i), the remedies
provided by LHWCA shall be the employee's exclusive remedy.
All of these provisions and other provisions of maritime law that were in
effect when LHWCA was passed, and which Congress did not intend to abrogate
by passing the act, secure the employer's right to recover either from the
third party directly or from the worker himself or herself the full measure
of compensation paid under LHWCA without reduction for attorney fees,
without contribution, without indemnity unless there is an indemnity
agreement, and without adjustment due to the comparative fault of the
employer vis- -vis the third party. Schreefel, 143 Cal. App. 3d at 822-23.
Although we deal with an issue of first impression in Washington, the
Schreefel court in California has previously determined, for these same
reasons, and for the reasons outlined by the United States Supreme Court in
Edmonds, 443 U.S. at 271-73, that California's comparative fault principles
must give way to the directly conflicting provisions of LHWCA and judge-
made admiralty law of which Congress was fully aware when it enacted LHWCA,
based on supremacy principles. 143 Cal. App. 3d at 825. See also
Hernandez v. Badger Construction Equip. Co., 28 Cal. App. 4th at 1825
(Schreefel was correctly decided); at 1808-11 (but Schreefel applies only
to economic damages recovered by the worker from the third party;
California statute limiting defendants' joint liability to economic damages
and shielding every defendant from any share of noneconomic damages beyond
that attributable to his or her own fault not preempted because employer's
right to recoup its Longshore Act workers compensation benefits not
abridged by applying statute to noneconomic damages only).
In sum, although the plain language of RCW 4.22.070(1) conflicts with
the federal scheme, so that the federal scheme must prevail to the extent
of such conflict, in actual fact, the federal and state immunity schemes
complement each other and serve the same purpose prompt payment of benefits
to the injured worker and immunity from allocation of fault to the
employer. See Stevedoring Services, 129 Wn.2d at 37; Moen, 128 Wn.2d at
759 n.7; Schreefel 143 Cal. App. 3d at 822. Thus, our Legislature is saved
from an absurd result it could not have intended in the first instance, an
unusual result, perhaps, of the application of supremacy principles, but a
just result.
Issue 6: Did the trial court properly deny Skyreach's motion to convert
the jury's lump-sum $137,285 future economic damages award to a stream of
periodic payments under RCW 4.56.260 because Skyreach first notified
Esparza of its intention to request such relief after the jury returned its
verdict?
Skyreach argues that it was entitled to a judgment of periodic payment
of the jury's award of $137,285 in future economic damages under RCW
4.56.260, notwithstanding its failure to request periodic payment until
after the jury verdict was rendered. Skyreach maintains that the trial
court erred by denying its post-verdict motion to convert the jury's award
of future economic damages to a stream of periodic payments, and argues
that under RCW 4.56.260, the trial court is required to convert a future
economic damages award of at least $100,000 to a stream of periodic
payments if a party so requests, regardless of when the request is made.
That statute provides:
In an action based on fault seeking damages for personal injury or property
damage in which a verdict or award for future economic damages of at least
one hundred thousand dollars is made, the court or arbitrator shall, at the
request of a party, enter a judgment which provides for the periodic
payment in whole or in part of the future economic damages.
RCW 4.56.260(1). The statute is silent regarding when a party must submit
such a request. Moreover, there are no published Washington cases
interpreting this statute and no published statements of legislative
intent.
In its memorandum opinion on this issue, the trial court stated that
'in order to apply {RCW 4.56.260} fairly it is essential that defendants
indicate their early intention to rely upon that law so that plaintiffs
have an opportunity to present appropriate economic evidence of the value
of future payments and that appropriate jury instructions and verdict forms
can be utilized.' Clerk's Papers at 536 (citing Green v. Franklin, 190
Cal. App. 3d 93, 235 Cal. Rptr. 312, 325-27 (1987); Craven v. Crout, 163
Cal. App. 3d 779, 209 Cal. Rptr. 649, 652 (1985)). The trial court then
concluded that Skyreach's post-verdict request to convert the jury's lump-
sum award of future economic damages to a stream of periodic payments was
'too late{.}' Clerk's Papers at 537. We agree.
California has a similar periodic payment statute to ours. The
California court noted in Green that in order to convert a jury's lump sum
award for future damages to present cash value, the trial court would have
to know whether the jury's lump sum award is based on present cash value,
or today's gross value without consideration of the effects of future
inflation, or today's gross value considering the effects of future
inflation. If the trial court were required to formulate a periodic
payment schedule when the jury's lump sum award was based on a discounted
figure reached by some unknown means, the judgment could in effect be
discounted twice. Green, 235 Cal. Rptr. 3d at 323. As the Green court
observed, 'We think it clear that the Legislature never intended such a
result when it enacted {California's periodic payment statute}.' Id. at
325.
Although the California Court of Appeals refused to hold that 'a
defendant's request for periodic payment of future damages must occur at
the commencement of trial or forever be waived{,}' it stated that 'such a
request should be made, at the very least, before a plaintiff's economic
experts are called to testify.' Id. at 325 n.16. The court explained that
such a requirement would impose 'no undue burden on the defense and affords
both parties the opportunity to submit jury instructions based upon the
evidence introduced at trial.' Id.
Conversion of future damages to present value and converting present
value to gross amounts can involve several judgment calls and
determinations of fact. Such judgment calls and determinations of fact
should be made by the jury unless the parties can agree to some other
means. The parties have a constitutional right to have the jury determine
issues of fact. Hrimnak v. Watkins, 38 Cal. App. 4th 964, 978-79, 45 Cal.
Rptr. 2d 514 (1995). In accord: Salgado v. County of Los Angeles, 19 Cal.
4th 629, 80 Cal. Rptr. 2d 46 (1998) (holding that the jury must return a
verdict for both present and future values and the trial court's periodic
payment schedule must match both the present and future values).
In order for the jury to properly perform its task, it must hear evidence
regarding the judgment calls and determinations of fact that need to be
made. It must also be instructed whether to award any future damages at
present cash value or some other value. Here, the jury was generally
instructed to consider the elements of future damages, including the
reasonable value of necessary medical care, treatment and services with
reasonable probability to be required in the future, and the reasonable
value of earnings with reasonable probability to be lost in the future.
Clerk's Papers at 370.
Each element of future damages accumulates at a different rate, and a
single lump sum figure makes it difficult for a trial court to ascertain
how much the jury intended to be for future medical care and how much for
future earnings, and what duration of payments the jury found to be
appropriate for each kind of future damages. A trial court would have no
way of knowing the answers to these questions, absent an appropriate
special verdict form, so that any attempt to apply a periodic payment
schedule would require arbitrary determinations by the court that could
result in under-compensation of the plaintiff or overpayment by the
defendant. The trial court's ruling was sensible and we affirm it.
Affirmed as to all the challenged rulings except the ruling that Skyreach
was prohibited from asking the jury to allocate fault to JLG Industries,
Inc., based on product liability for failure to warn of a danger as
provided under RCW 7.72.030(1)(c). Skyreach is entitled to a new trial on
that issue. Skyreach is not entitled to a new trial on the question of its
own liability but only as to the percentage, if any, of the total fault to
be allocated to the manufacturer of the manlift.
WE CONCUR:
1 Although the operator of the manlift, William Espy, was a plaintiff
in this action at trial, and initially was a respondent in this appeal,
this case now involves only Esparza.
2 Esparza also urges us to decline to reach this issue because our opinion
is merely advisory, in that it can have no practical effect absent a new
trial with respect to Skyreach's liability to Esparza. We have elected to
reach the issue because we are granting a new trial with respect to whether
any portion of the fault for Esparza's injury should be allocated to the
manufacturer of the manlift, and we cannot determine from the present
record that Weaver is not a potential witness with respect to that issue.