BRIAN MCFALL v. RICHARD FERRELL; FERRELL'S LOGGING PRODUCTS, INC. ROCKHOUSE WOOD PRODUCTS, INC. v. RICHARD FERRELL D/B/A FERRELL LOGGING AND LUMBER COMPANY, AND FERRELL'S LOGGING AND LUMBER
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RENDERED: December 30, 1999; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-002367-MR
BRIAN MCFALL
v.
APPELLANT
APPEAL FROM LETCHER CIRCUIT COURT
HONORABLE SAMUEL T. WRIGHT, JUDGE
ACTION NO. 95-CI-00326
RICHARD FERRELL; FERRELL'S LOGGING
& LUMBER, INC.; and, ROCKHOUSE WOOD
PRODUCTS, INC.
AND
NO.
1998-CA-002366-MR
ROCKHOUSE WOOD PRODUCTS, INC.
v.
APPELLEES
APPELLANT
APPEAL FROM LETCHER CIRCUIT COURT
HONORABLE SAMUEL T. WRIGHT, JUDGE
ACTION NO. 95-CI-00326
RICHARD FERRELL D/B/A FERRELL
LOGGING AND LUMBER COMPANY, AND
FERRELL'S LOGGING AND LUMBER
COMPANY, INC.
APPELLEES
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
GARDNER, GUIDUGLI, AND KNOX, JUDGES.
KNOX, JUDGE:
In this personal injury action involving claims of
negligence and products liability, appellants, Brian McFall
(plaintiff below) and his employer, Rockhouse Wood Products, Inc.
(Rockhouse Wood), appeal from a jury verdict and judgment finding
that Rockhouse Wood’s failure to exercise ordinary care for the
safety of its employees caused McFall’s injuries.
The jury
assessed one hundred percent (100%) fault against Rockhouse Wood.
The jury further found that defendants below and appellees
herein, Richard Ferrell and Ferrell Logging and Lumber, Inc.,
were neither negligent in this matter nor were they “sellers” for
purposes of McFall’s products liability claim.
We affirm.
On October 17, 1994, McFall, an employee of Rockhouse
Wood, was unloading lumber when his clothing and shoe got caught
in the chain of the conveyor table, pulling his leg into the
chain.
McFall suffered severe injury to his right leg, which
ultimately had to be amputated just below the knee.
The evidence
in the record establishes that in September 1993, Rockhouse Wood
purchased the “used” conveyor table from Ferrell Lumber and
Logging, Inc. (Ferrell Lumber), which had advertised the table in
a trade magazine.
In October 1995, McFall sued Ferrell Lumber in Letcher
Circuit Court, alleging it had sold the table in a defective and
dangerous condition, had failed to warn of the condition or
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otherwise provide precautions for the safe use of the table, and,
further, had been negligent in the condition and sale of the
table.1
Shortly thereafter, Rockhouse Wood intervened in the
action as a party plaintiff, asserting its right to be reimbursed
to the extent it had paid McFall workers’ compensation benefits.
In its answer to Rockhouse Wood’s intervening complaint, Ferrell
Lumber asserted negligence on the part of Rockhouse Wood.2
A trial in the matter was held on November 3, 1997.
The jury found that: (1) Ferrell Lumber was not a “seller” of the
conveyor table for purposes of McFall’s products liability claim;
(2) Ferrell Lumber did not fail to comply with its duty of
ordinary care owed McFall; (3)McFall was not responsible for, nor
did he contribute to, his own injuries; (4) Rockhouse Wood,
McFall’s employer, failed to comply with its duty of ordinary
care owed McFall, which failure was a substantial factor in
causing McFall’s injuries; and, (5) Rockhouse Wood was one
hundred percent (100%) at fault in causing McFall’s injuries.
On
February 11, 1998, judgment was entered in favor of Ferrell
Lumber.
This appeal ensued.
1
McFall also sued Begley Lumber Company, which had
apparently owned the table prior to Ferrell Lumber. McFall later
agreed to voluntarily dismiss Begley Lumber Company as a party,
due to a statute of limitations problem.
2
Similarly, in its answer to Rockhouse Wood’s intervening
complaint, defendant Begley Lumber Company, ultimately dismissed
as a party, alleged it was entitled to apportionment for any
negligence, failure to warn, improper training, etc., on
Rockhouse Wood’s part.
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The following two (2) instructions, concerning
negligence on the part of Rockhouse Wood, were submitted to the
jury:
No. 7:
It was the duty of Rockhouse Wood
Products, Inc., to exercise
ordinary care for the safety of
others who use the chain conveyor,
including the Plaintiff, Brian
McFall.
As used in this Instruction,
“ordinary care” means such care as
the jury would expect an ordinarily
prudent company or person, engaged
in a business similar to that of
Rockhouse Wood Products, Inc.,
should exercise under similar
circumstances.
Do you find from the evidence that
Rockhouse Wood Products, Inc.,
failed to comply with its duty of
ordinary care and that such failure
was a substantial factor in causing
the injuries to the Plaintiff?
No. 8:
You will determine from the
evidence and indicate in the
following blank spaces what
percentage of total fault is
attributable to the persons
hereafter named, you find to have
been at fault, as follows:
Richard Ferrell and Ferrell’s
Logging & Lumber, Inc. ____ %
Brian McFall ____ %
Rockhouse Wood Prod., Inc. ____ %
On appeal, McFall and Rockhouse Wood argue that the
jury should not have received instructions concerning negligence
on Rockhouse Wood’s part.
We are mindful of CR 51(3), which
requires that a party appealing an instruction issue voice an
exception or objection to the instruction in order to preserve
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the issue on appeal.
Specifically, the party must “present[] his
position by an offered instruction or by motion, or . . . make[]
objection before the court instructs the jury, stating
specifically the matter to which he objects and the ground or
grounds of his objection.”
CR 51(3).
In light of CR 51, we note that in spite of expressing
to the court some reservation about the above instructions,
counsel for McFall specifically agreed to submit them to the
jury.
The following represents comments made by counsel for
McFall in the court’s chambers, at the close of the evidence:
There’s some question in my mind as to
whether or not a comparative negligence
instruction can be given here without a
crossclaim having been filed, or whatever you
would call it, against Rockhouse Wood
Products. And, none has been filed. But, I
don’t want any possibility, this is too big
and important to have any possibility of
error. And I want to avoid it . . . . Now,
ordinary care instructions on the plaintiff,
ordinary care instruction on Rockhouse Wood
Products, then a comparative negligence
instruction, then the damages instruction.
Now, that’s the way I see we preclude the
instructions questions.
During this same discussion in chambers concerning the
instructions, upon the court’s reference to the issue of whether
or not the above-referenced ordinary care instruction should be
submitted to the jury, counsel for McFall responded, “I’m not
saying to exclude that, Judge.
I think an ordinary care
instruction would be appropriate.”
Given that counsel for McFall
did not take exception or object to the instructions at issue,
but rather, specifically agreed that they were appropriate to
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submit to the jury, we believe McFall has waived this issue on
appeal.
We turn now to Rockhouse Wood’s argument.
We note that
the original defendant in this matter, Begley Lumber Company
(Begley Lumber), ultimately dismissed as a party due to a statute
of limitations problem, filed a “counterclaim” against Rockhouse
Wood in answer to Rockhouse Wood’s intervening complaint.
The
counterclaim essentially asserted Begley Lumber’s right to
apportionment in the event the jury determined that Rockhouse
Wood had been negligent in this matter.
Rockhouse Wood then
answered Begley Lumber’s counterclaim and, additionally,
responded to requests for discovery propounded by Begley Lumber.
In December 1996, Rockhouse Wood moved the court for an
order holding its subrogation claim in abeyance, arguing that
none of the parties disputed its right to be reimbursed workers’
compensation benefits paid McFall.
It noted that Ferrell Lumber
had asserted a claim of “contributory negligence” against it, and
assured the court in its motion that Ferrell’s “counterclaim for
indemnity, contribution and/or apportionment against Rockhouse,
will still be defended.”
Shortly thereafter, Rockhouse Wood
tendered its proposed instructions to the court.
Two (2) of
those instructions were virtually identical to those which
Rockhouse Wood now argues were inappropriate:
Are you satisfied from the evidence that
Rockhouse Wood Products, Inc., failed to use
ordinary care to properly inspect, maintain,
and service the chain conveyor in question,
and that such failure was a substantial cause
of the accident and Brian McFall’s injuries?
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You will now determine from the evidence and
indicate on the following blank spaces what
percentage of the total fault was
attributable to each of the parties, as
follows:
Brian McFall ____ %
Ferrell Logging & Lumber ____ %
Rockhouse Wood Products ____ %
On appeal, Rockhouse Wood argues that because the
circuit court ultimately granted its motion to hold its
subrogation claim in abeyance, it was not truly a “party” before
the court at the time of trial.
Thus, it maintains, the jury
should not have had the opportunity to pass upon its duty of care
in the matter, or apportion any percentage of fault against it.
Further, Rockhouse Wood argues, because it was not brought in as
a third-party defendant in this action, an apportionment
instruction against it was improper.
We disagree.
First, we note that Rockhouse Wood stated
its intent, by way of its pleadings, to defend the apportionment
claim against it at trial, yet did not do so.
Further, Rockhouse
Wood submitted proposed instructions containing the very language
to which it now objects.
Most significantly, however, KRS
411.182, addressing allocation of fault in tort actions, states
in pertinent part:
(1) In all tort actions, including products
liability actions, involving fault of more
than one party to the action, including
third-party defendants and persons who have
been released under subsection (4) of this
section, the court, unless otherwise agreed
by all parties, shall instruct the jury to
answer interrogatories or, if there is no
jury, shall make findings indicating:
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. . . .
(b) The percentage of the total fault of
all the parties to each claim that is
allocated to each claimant, defendant, thirdparty defendant, and person who has been
released from liability under subsection (4)
of this section.
. . . .
(4) A release, covenant not to sue, or
similar agreement entered into by a claimant
and a person liable, shall discharge that
person from all liability for contribution .
. . .
Given that an injured worker cannot collect from both his
employer and a third-party tortfeasor, in the event he is injured
on the job (see KRS 342.700(1)), the employer is essentially
immunized from tort liability if the worker sues a third party
for damages.
Our highest court has characterized the employer,
in such a situation, as a tortfeasor which has settled the tort
claim against it:
In Stratton v. Parker, Ky., 793 S.W.2d
817 (1990), we held:
“The law has now developed to
the point that in tort actions
involving the fault of more than
one party, including third-party
defendants and persons who have
settled the claim against them, an
apportionment instruction, if
requested, must be given whereby
the jury will determine the amount
of the plaintiff’s damage and the
degree of fault to be allocated to
each claimant, defendant, thirdparty defendant, and person who has
been released from damage. The
extent of the liability of each is
a several liability and is limited
to the degree of fault apportioned
to each.”
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In this case, what otherwise would have
been tort liability of [the employer] to the
injured worker has been extinguished by
reason of the workers[’] compensation
coverage. As a practical matter, workers[’]
compensation coverage constitutes a
settlement between the employee and the
employer whereby the employee settles his
tort claim for the amount he will receive as
compensation. For all practical purposes, in
this case, [the employer] occupies the
position of a tort-feasor which has settled
the tort claim against it.
Dix & Assoc. Pipeline Contractors, Inc. v. Key, Ky., 799 S.W.2d
24, 28-29 (1990).
In light of the above case law, we believe
that Rockhouse Wood constituted a party which was released under
subsection (4) of KRS 411.182 and, therefore, was a party subject
to an apportionment instruction under subsection (1)(b) of that
statute.
Appellants’ second and final argument on appeal is that
the issue of whether Ferrell Lumber was a “seller” under products
liability law should not have been submitted to the jury, but
rather, the court should have granted McFall a directed verdict
on this issue as a matter of law.
McFall brought his products
liability claim pursuant to section 402A of the Restatement
(Second) of Torts, which states in pertinent part:
(1) One who sells any product in a defective
condition unreasonably dangerous to the user
or consumer or to his property is subject to
liability for physical harm thereby caused to
the ultimate user or consumer, or to his
property, if
(a) the seller is engaged in the business of selling such a
product[.]
We are mindful of the following:
On a motion for directed verdict,
the trial judge must draw all fair and
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reasonable inferences from the evidence in
favor of the party opposing the motion. When
engaging in appellate review of a ruling on a
motion for directed verdict, the reviewing
court must ascribe to the evidence all
reasonable inferences and deductions which
support the claim of the prevailing party.
Once the issue is squarely presented to the
trial judge, who heard and considered the
evidence, a reviewing court cannot substitute
its judgment for that of the trial judge
unless the trial judge is clearly erroneous.
In reviewing the sufficiency of
evidence, the appellate court must respect
the opinion of the trial judge who heard the
evidence. A reviewing court is rarely in as
good a position as the trial judge who
presided over the initial trial to decide
whether a jury can properly consider the
evidence presented. Generally, a trial judge
cannot enter a directed verdict unless there
is a complete absence of proof on a material
issue or if no disputed issues of fact exist
upon which reasonable minds could differ.
Where there is conflicting evidence, it is
the responsibility of the jury to determine
and resolve such conflicts, as well as
matters affecting the credibility of
witnesses. The reviewing court, upon
completion of a consideration of the
evidence, must determine whether the jury
verdict was flagrantly against the evidence
so as to indicate that it was reached as a
result of passion or prejudice. If it was
not, the jury verdict should be upheld.
Bierman v. Klapheke, Ky., 967 S.W.2d 16, 18-19 (1998) (citations
omitted).
We have reviewed the videotape of this matter,
particularly the testimony provided by appellee, Richard Ferrell.
Mr. Ferrell testified that he is in the “lumber” business, i.e.
he processes it, upgrades it, and ships it to manufacturers.
He
began operation of his sawmill in 1988 and, at the present time,
the business grosses two (2) million dollars in annual sales of
lumber.
Since 1988, he testified, he has sold two (2) conveyor
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tables, including the one he sold to Rockhouse Wood in 1993, and
other equipment a “few” times.
Over the past several years, he
estimated he had averaged the sale of only one (1) or two (2)
pieces of equipment per year.
Mr. Ferrell testified that it is
his practice to sell the equipment he plans to replace.
He
advertised the table at issue in “Taladega Machinery,” a monthly
trade magazine.
Countering McFall’s products liability claim,
Mr. Ferrell maintained that he is only an occasional seller of
his used equipment and that, certainly, the sale of his equipment
is not a meaningful part of his business, but rather, merely
incidental to it.
In reviewing this issue, we note the following products
liability law:
The liability imposed by section 402A relates
to the sale of a defective product by one
engaged in the business of selling. “It is
axiomatic that one basic requirement for the
application of the rule of strict liability
under section 402A is that the defendant must
be engaged in the business of selling the
chattel.” The liability imposed by section
402A is special liability limited to
manufacturers and distributors engaged in the
business of selling the product in question.
The otherwise valuable rule of strict
liability does not apply to the occasional
seller of an allegedly defective product.
When a product is sold only on an occasion or
incident to the business of the seller, the
transaction does not come within the purview
of the doctrine of strict liability.
Griffin Indus., Inc. v. Jones, Ky., 975 S.W.2d 100, 102-03 (1998)
(citations omitted).
We conclude that Mr. Ferrell presented evidence
sufficient to submit the issue to the jury.
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Given the law of
products liability concerning the evidence necessary to establish
“seller” status, and considering Mr. Ferrell’s testimony, we
believe that reasonable minds could differ concerning whether
Ferrell Lumber is engaged in the business of selling used
equipment such as the conveyor table at issue or whether, on the
other hand, Ferrell Lumber is merely an occasional seller of such
equipment.
We do not believe the jury’s determination that
Ferrell Lumber is not a “seller” of sawmill equipment was
flagrantly against the evidence such as would indicate passion or
prejudice on the jury’s part.
For the foregoing reasons, the judgment of the Letcher
Circuit Court is affirmed.
ALL CONCUR.
BRIEF FOR BRIAN MCFALL:
BRIEF FOR APPELLEES:
Ronald G. Polly
Whitesburg, Kentucky
Harold D. Bolling
Whitesburg, Kentucky
BRIEF FOR ROCKHOUSE WOOD
PRODUCTS, INC.:
J. Stan Lee
J. Thomas Rawlings
Lexington, Kentucky
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