Clarke Industries v. Home Indem. Co.

Citations: 591 So. 2d 458; 1991 Ala. LEXIS 1056; 1991 WL 219476Docket: 1901095

Court: Supreme Court of Alabama; October 31, 1991; Alabama; State Supreme Court

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Home Indemnity Company insured Michael and Connie Hicklin's home, which was destroyed by fire. After paying the Hicklins, Home sued Clarke Industries, Inc. for negligent failure to warn, breach of warranty, and violation of the Alabama Extended Manufacturer's Liability Doctrine (AEMLD). A jury found in favor of Home, awarding $100,000 in damages. The trial court denied Clarke's motions for a judgment notwithstanding the verdict and a new trial, and awarded Home $18,591.48 in prejudgment interest.

Clarke appealed, arguing that Home failed to present substantial evidence for its claims. The facts revealed that Mr. Hicklin rented a Clarke floor sander, receiving only a general pamphlet and rental agreement, which lacked specific warnings about spontaneous combustion of the dust collection bag. After sanding, Mr. Hicklin did not empty the bag, which later ignited and caused the fire. An investigator determined the fire resulted from spontaneous combustion in the dust bag, which was of a different brand and did not carry Clarke's fire hazard warnings. Evidence indicated Clarke was aware that rental companies often used cheaper, non-warned bags and that the sander lacked specific fire hazard warnings. The existing placard on the sander only instructed users to empty the dust bag when half full and provided no information about fire risks.

Mr. Hicklin meticulously examined the sander, adhered to all provided instructions, and unplugged the machine after use. He also rolled up the cord and inspected the machine thoroughly before and during its operation. There was no indication he ignored any information given to him. Dr. V. Morfopoulos, a safety engineer, emphasized the need for manufacturers to warn users about the risk of spontaneous combustion of sander dust, noting that this knowledge has existed for over 50 years. He argued that warnings should be affixed directly to the machine rather than just provided in literature or on sander bags.

Clarke asserts that Home did not demonstrate the necessary elements for an Alabama Extended Manufacturer’s Liability Doctrine (AEMLD) or negligence claims. Specifically, Clarke disputes the existence of substantial evidence supporting that inadequate warnings caused the fire, that the product was in the same condition at the time of the accident as when sold, and that Clarke failed to provide adequate warnings regarding the product's hazards. Under AEMLD, a plaintiff must show injury or damage from a product in a defective condition that is unreasonably dangerous, with the seller being engaged in the business of selling such a product and it reaching the consumer without substantial change.

Liability for a breach of the duty to warn is based on the supplier’s knowledge of the product's potential dangers and their responsibility to inform users. Clarke argues that Home did not prove Mr. Hicklin would have seen or heeded any warnings on the sander. The case of Squibb, Sons, Inc. v. Cox is cited by Clarke, but it is distinguished from the current situation, as in Squibb, the plaintiff admitted to not reading any warnings. The court held that a plaintiff's failure to read an inadequate warning cannot support a negligence claim unless the inadequacy prevents reading it, concluding that the presumed inadequacy of Squibb's warning did not cause the plaintiff's injury.

Mr. Hicklin provided testimony indicating that he diligently followed a "do-it-yourself" sanding guide, reviewed the invoice from Mullins, and inspected the sander before use. He confirmed that he checked for nail heads, sanded the edges of the walls, and properly stored the sander after use. However, he was not warned of the risk of spontaneous combustion from the dust in the collection bag, and there was no warning on the sander itself. The court noted substantial evidence suggesting that if a warning had been present, Mr. Hicklin would have acknowledged and followed it.

Clarke argued that Home did not prove the sander was received without substantial changes from its original condition. The court found it undisputed that the sander was rented without a Clarke dust collection bag, which would have included a warning about spontaneous combustion. Nonetheless, the court concluded that this did not constitute a substantial change in the machine’s condition since Clarke was aware that bags often wore out and that rental dealers commonly used cheaper alternatives.

Additionally, Clarke contended that its warnings were reasonable. However, evidence showed that the risk of spontaneous combustion had been known for over 50 years, and proper engineering standards called for a permanent warning label directly on the machine. Given the potential dangers associated with the sander, the court determined that Clarke failed to provide adequate warnings.

Consequently, the trial court's denial of Clarke's motion for judgment notwithstanding the verdict (j.n.o.v.) was upheld, affirming the judgment against Clarke based on substantial evidence supporting both the negligent failure to warn and AEMLD claims.