Wireman v. Keneco Distributors, Inc. - Ohio Supreme Court Opinion - Ohio Supreme Court Decision

	ROMINGER LEGAL
		Ohio Court Cases and Opinions - Ohio Legal Research
					Need Legal Help?
					Need Legal Help?
LEGAL RESEARCH CENTER
LEGAL RESEARCH CENTER			LEGAL HEADLINES - CASE LAW - LEGAL FORMS	NOT FINDING WHAT YOU NEED? -RESEARCH

This court case was taken from the web sites of the Ohio Courts. Search our site for more cases - CLICK HERE

LEGAL RESEARCH

COURT REPORTERS

PRIVATE INVESTIGATORS

PROCESS SERVERS

DOCUMENT RETRIEVERS

EXPERT WITNESSES

Find a Private Investigator

Find an Expert Witness

Find a Process Server

Case Law - save on Lexis / WestLaw.

Legal News - Legal Headlines

1
Wireman, Administrator, et al., Appellants, v. Keneco Distributors, Inc., et
2
al.; Marathon Oil Company et al., Appellees.
3
[Cite as Wireman v. Keneco Distributors, Inc. (1996), ___ Ohio St.3d. ___.]
4
Torts -- Wrongful death -- Products liability -- "Product" as used in
5
R.C. 2307.71, construed and applied -- Failure to warn -- R.C.
6
2307.76, applied.
7

(No. 94-1448 -- Submitted October, 1995 -- Decided March 4, 1996.)
8

APPEAL from the Court of Appeals for Wood County, No. 93WD
9
078.
10

Appellant, Peggy Wireman, is the administrator of the estate of her
11
late husband, Douglas E. Wireman. On August 24, 1990, Douglas Wireman
12
was working in a bulk gasoline storage tank near Portage, Ohio, when the
13
tank exploded. Douglas Wireman died two days later from the injuries he
14
sustained in this explosion.
15

Appellee Marathon Oil Company ("Marathon") originally installed
16
the storage tank in which Douglas Wireman suffered his fatal injuries. The
17
tank was placed at the Portage site when Marathon converted one of its
18
service stations to a bulk plant. In 1980, Marathon designed and had
19
installed a vapor recovery system ("VRS") for gasoline storage tanks at the

1
Portage site. The purpose of this system was twofold. The first purpose of
2
the VRS was that it allows petroleum vapor pressure to balance among
3
connected storage tanks -- thus, reducing the chances that fumes would be
4
released into the atmosphere due to high vapor pressure. The second
5
purpose of the VRS was that it prevented gasoline vapors from entering the
6
environment during the loading and unloading of petroleum products.
7

In 1988, Marathon leased the Portage plant to Keneco Distributors,
8
Inc. ("Keneco"). The following year, Marathon sold the plant to Keneco's
9
land-holding corporation, KDI Properties, Inc. Keneco contracted with
10
Marathon to continue to use the plant to distribute Marathon products.
11

During the late spring of 1990, Keneco sought to extend the life of its
12
above-ground storage tanks and reduce the possibility of a petroleum spill
13
into a branch of the nearby Portage River. To this end, Keneco hired
14
Interdyne Corporation to clean the tanks and fiberglass the bottom and part
15
of the interior walls. Interdyne, in turn, hired K-M Contracting, Inc. ("K-
16
M") to sandblast the tanks and to actually install the fiberglass material. It
17
appears K-M, in turn, hired Aerco Sandblasting, Inc., to sandblast the tank's
18
interior walls.
2

1

On the morning of August 24, 1990, a Northwest Enterprises, Inc.
2
transport truck delivered approximately eight thousand five hundred gallons
3
of gasoline to the Portage bulk plant. The transport truck's driver, Steve
4
Freymuth, did not utilize the vapor recovery system at the plant because he
5
had been told by Keneco employees that it was inoperative.
6

Shortly following the tanker's departure, K-M employees, brothers
7
Robert and Douglas Wireman, arrived at the plant for the purpose of
8
installing the fiberglass material in four of the plant's tanks. These tanks
9
were to have previously been prepared for the installation. They were to
10
have been powerwashed and sandblasted, and the resulting debris was to
11
have been removed by Interdyne and Aerco. However, when Douglas
12
Wireman examined the interior of tank 101, he discovered sand on the floor.
13
Because the fiberglass material could not be installed over the sand,
14
Douglas Wireman borrowed a common Black and Decker shop vac and an
15
extension cord from Keneco employees.
16

When Douglas Wireman started the shop vac inside tank 101, an
17
explosion took place which separated the tank's lid from its sides at the
18
weld. Douglas Wireman died of the injuries he received in the blast.
3

1

Following Douglas Wireman's death, appellants, Peggy Wireman as
2
administrator of his estate and individually as his wife, brought this
3
wrongful death suit. Appellants alleged that the failure of the transport
4
driver to utilize the vapor recovery system during the delivery of eight
5
thousand five hundred gallons of gasoline displaced gasoline vapors into the
6
VRS which relayed these explosive vapors into tank 101. It was these
7
vapors that were ignited by the spark from Douglas Wireman's shop vac,
8
causing the explosion that killed him. Appellants' suit named ten
9
corporations and individuals as defendants alleging a variety of negligent
10
acts among them. Included among these defendants were the petroleum
11
transport company, appellees Northwest Enterprises, Inc., d.b.a. Northwest
12
Oil Co., Northwest Enterprises' president, appellee Harold Jackson, Jr., and
13
its driver, appellee Steve Freymuth. Appellants also sued the decedent's
14
employer, appellee K-M Contracting, Inc. and its president and sole
15
stockholder, appellee Kevin L. Everhardt. Appellee Marathon Oil Company
16
was another named defendant.
17

In the trial court, appellees Northwest Enterprises, Inc. (Northwest
18
Oil, Inc.), Jackson, Freymuth, Everhardt and Marathon Oil Company moved
4

1
for and were granted summary judgment. The trial court's determined that,
2
pursuant to Civ.R. 54(B), that there was no just cause for delay.
3

The Court of Appeals for Wood County affirmed the trial court's
4
award of summary judgment.
5

This matter is now before this court upon the allowance of
6
discretionary appeal.
7

Mihlbaugh & Mihlbaugh, Michael P. Mihlbaugh and Robert H.
8
Mihlbaugh for appellants.
9

Shumaker, Loop & Kendrick, John C. Barron, Thomas P. Dillon and
10
Jeffrey S. Creamer, for appellee Marathon Oil Company.
11

Hammond Law Office and Frederick A. Sewards, for appellees
12
Northwest Enterprises, Inc., Freymuth and Jackson.
13

John K Fitch, urging reversal for amicus curiae, Ohio Academy of
14
Trial Lawyers.
15

PFEIFER, J. Appellants contend that Wireman was fatally injured
16
when he was negligently instructed to use a shop vac to clean tank 101.
17
Appellants contend that the explosion of tank 101 was caused by a spark
18
from the shop vac igniting gasoline vapors in the tank. Appellants claim
5

1
that the gasoline vapors flowed into tank 101 through a pipe in the VRS that
2
connects tank 101 to an adjoining tank. Appellants contend that Marathon's
3
design of the VRS was defective because it allowed this flow of fumes. On
4
the morning of Wireman's fatal injury, an adjoining tank had been filled
5
with gasoline by an employee of Northwest. Appellants contend that if the
6
VRS had been used as designed during the delivery of gasoline from the
7
Northwest truck into the adjoining tank, the fumes from the gasoline being
8
pumped into the tank would have been returned to the Northwest truck and
9
would not have gone into tank 101.
10

Appellants contest the trial court's award of summary judgment to
11
Marathon, Freymuth, Northwest and Jackson.
12
I
13
Claims against Marathon
14
A
15
Products Liability
16

The court of appeals upheld the trial court's award of summary
17
judgment for Marathon because it found that the VRS was not tangible
18
personal property as defined in R.C. 2307.71, and, thus, appellant could not
6

1
pursue a products liability claim against Marathon. R.C. 2307.71 provides
2
in relevant part:
3

"As used in sections 2307.71 to 2307.80 of the Revised Code:
4

"* * *
5

"(L)(1) `Product' means, subject to division (L)(2) of this section, any
6
object, substance, mixture, or raw material that constitutes tangible personal
7
property * * *." (Emphasis added.)
8

Under this definition, an item must be personal property before it can
9
fall within the realm of products liability. The court of appeals found the
10
VRS to be a fixture. Because we find that the VRS is not a fixture, we hold
11
that the VRS is personal property.
12
In
Teaf v. Hewitt (1853), 1 Ohio St. 511, this court adopted the
13
following definition of fixtures:
14

"A fixture is an article which was a chattel, but which by being
15
physically annexed or affixed to the realty, became accessory to it and part
16
and parcel of it. But the precise point in the connection with the realty,
17
where the article loses the legal qualities of a chattel and acquires those of
7

1
the realty, often presents a question of great nicety and sometimes difficult
2
determination." Id. at 527.
3

"From the examination which I have been enabled to give to this
4
subject, and after a careful review of the authorities, I have reached the
5
conclusion that the united application of the following requisites will be
6
found the safest criterion of a fixture.
7

"1st. Actual annexation to the realty, or something appurtenant
8
thereto.
9

"2d. Appropriation to the use or purpose of that part of the realty with
10
which it is connected.
11

"3d. The intention of the party making the annexation, to make the
12
article a permanent accession to the freehold -- this intention being inferred
13
from the nature of the article affixed, the relation and situation of the party
14
making the annexation, the structure and mode of annexation, and the
15
purpose or use for which the annexation has been made." Id. at 529-530.
16

Appellants contend that the VRS does not meet the third prong of this
17
definition. Because we find that there was never an intention to make the
8

1
VRS a permanent accession to the freehold where it was being used, we
2
agree with appellants.
3

The record is clear that Marathon lacked the requisite intent to make
4
the VRS a permanent addition to the bulk plant. The VRS was attached to
5
four aboveground storage tanks. On October 3, 1989, Marathon sold the
6
tanks along with the VRS by a bill of sale, pursuant to an earlier agreement
7
to an offer to purchase. It is a long-standing rule of law that when property
8
is sold by bill of sale, the property is presumed to be personalty. See
9
Fortman v. Goepper (1863), 14 Ohio St. 558.
10

Also, in the offer to purchase agreed to by Marathon and Keneco,
11
there is a provision obligating Keneco to remove the aboveground storage
12
tanks if removal is required by law. Thus, Marathon never intended that
13
those tanks and attached VRS be a permanent part of the premises where
14
they rested. Finally, a bill of sale for similar, tanks on the premises, which
15
was agreed to by Marathon, classified those tanks as personal property.
16

For these reasons we find that the VRS was personal property when
17
Wireman was fatally injured. Thus, the court of appeals erred when it
9

1
concluded that the VRS was a fixture, and its judgment concerning this
2
legal issue is reversed.
3
B
4
Failure to Warn
5

Appellants claim that the court of appeals erred when it upheld the
6
trial court's award of summary judgment to Marathon on appellants' failure-
7
to-warn claim. We agree with appellants that their failure-to-warn claim
8
should survive Marathon's motion for summary judgment.
9

Appellant's theory of liability is that Marathon failed to post a
10
warning for the benefit of those entering the tank. Presumably, such a
11
warning would state that petroleum vapors might be present in the tank, due
12
to the connections between the four aboveground tanks, even if no fuel is
13
present in the tank being entered. This claim was not addressed by the court
14
of appeals in its opinion.
15

R.C. 2307.76 regulates failure-to-warn claims. The statute provides:
16

"(A) Subject to divisions (B) and (C) of this section, a product is
17
defective due to inadequate warning or instruction if either of the following
18
applies:
10

1

"(1) It is defective due to inadequate warning or instruction at the
2
time of marketing if, when it left the control of its manufacturer, both of the
3
following applied:
4

"(a) The manufacturer knew or, in the exercise of reasonable care,
5
should have known about a risk that is associated with the product and that
6
allegedly caused harm for which the claimant seeks to recover
7
compensatory damages;
8

"(b) The manufacturer failed to provide the warning or instruction
9
that a manufacturer exercising reasonable care would have provided
10
concerning that risk, in light of the likelihood that the product would cause
11
harm of the type for which the claimant seeks to recover compensatory
12
damages and in light of the likely seriousness of that harm."
13

We find the record contains sufficient evidence supporting
14
appellants' failure-to-warn claim. It is undisputed that Marathon never
15
posted a warning on the side of tank 101 or on the VRS which indicated that
16
fumes may be present in the tank that DouglasWireman entered.
17

Marathon appears to argue that appellants are precluded from
18
bringing a failure-to-warn claim because Marathon claims that the VRS is
11

1
not a "product" under R.C. 2307.76. Because R.C 2307.76 the uses the
2
definition of "product" in R.C. 2307.71, and because we have already
3
determined that the VRS is a product pursuant to R.C. 2307.71, we hold that
4
appellants' failure-to-warn claim is sufficient to survive a motion for
5
summary judgment. We reverse the judgment of the court of appeals on this
6
issue.
7
C
8
Premises Liability
9

Appellants also claim that the trial court erred when it granted
10
Marathon's motion for summary judgment because the record contains
11
sufficient evidence that Marathon intentionally violated the terms of its
12
permit to operate. The permit provides in relevant part:
13

"Any malfunction of this source or any associated air pollution
14
control system(s) shall be reported immediately to the appropriate Ohio
15
EPA field office in accordance with OAC rule 3745-15-06. Except as
16
provided in that rule, any scheduled maintenance or malfunction
17
necessitating the shut down or bypassing of any air pollution control
18
system(s) shall be accompanied by the shut down of this source."
12

1

Appellants contend that Marathon should have shut down the bulk
2
plant as soon as it discovered that loading arm of the VRS was not operating
3
correctly. If the plant had been shut down by Marathon, appellants contend,
4
Wireman would have never been injured.
5

The problem with appellants' argument is that Marathon was
6
powerless to shut down the bulk plant. It is a fundamental tenet of premises
7
tort law that to have a duty to keep premises safe for others one must be in
8
possession and control of the premises. Wills v. Frank Hoover Supply
9
(1986), 26 Ohio St.3d 186, 26 OBR 160, 497 N.E.2d 1118. Therefore, we
10
affirm the judgment of the court of appeals on this issue.
11
D
12
Agency
13

Appellants contend that the court of appeals erred when it upheld the
14
trial court's award of summary judgment to Marathon for appellants' agency
15
claim. We disagree with appellants.
16

In essence, appellants argue that the employees of Keneco who
17
negligently directed Douglas Wireman to use a shop vac in tank 101
18
appeared to Wireman to be agents of Marathon. Thus, Marathon should be
13

1
liable for the Keneco employees' negligence. See Shaffer v. Maier (1994),
2
68 Ohio St.3d 416, 627 N.E.2d 986. We decline to consider this issue,
3
however, because it was not raised by appellants in the court of appeals and
4
has been waived.
5
II
6
Claims against Northwest, Jackson and Freymuth
7

Appellants contend that the trial court erred when it granted the
8
motion for summary filed by Northwest, Jackson and Freymuth.
9
Appellant's theory of liability is that Freymuth violated Ohio Adm. Code
10
3745-21-09 (V)(1)(i) when he failed to use the VRS as he was unloading his
11
tanker truck at the bulk plant. The regulation provides:
12

"No gasoline tank truck is to be used for the transfer of gasoline at a
13
bulk gasoline terminal, bulk gasoline plant or gasoline dispensing facility
14
that employs a vapor balance system or vapor control system unless the
15
transfer is done in a manner that ensures the proper operation of the vapor
16
balance system or vapor control system."
14

1

Appellant contends that because Freymuth violated this section of the
2
code, he, his employer, Northwest, and the president and sole shareholder of
3
Northwest, Jackson, were all negligent per se. We disagree.
4

Where an enactment imposes upon a person a specific duty for the
5
protection of others, his failure to observe that duty constitutes negligence
6
per se. Taylor v. Webster (1967), 12 Ohio St.2d 53, 56, 41 O.O.2d 274, 275,
7
231 N.E.2d 870, 872.
8

In order to determine whether a violation of Ohio Adm. Code 3745-
9
21-09 constitutes negligence per se, we must first determine whether this
10
Administrative Code provision was intended to affect the duties owed for
11
the safety and protection of others. See Hernandez v. Martin Chevrolet
12
Inc.(1995), 72 Ohio St.3d 302, 649 N.E.2d 1215.
13

An examination of the code provision reveals that it is an
14
environmental regulation intended to prevent the emissions of fumes into
15
the atmosphere. The code provision is entitled, "Control of emissions of
16
volatile organic compounds from stationary sources." Thus, the
17
Administrative Code provision that Freymuth allegedly violated may
18
impose on Marathon a duty to refrain from releasing fumes into the
15

1
atmosphere. Appellants do not contend that Douglas Wireman was injured
2
by a release of fumes from the VRS into the atmosphere. Therefore,
3
Douglas Wireman's injury was not caused by any breach of any duty created
4
by the Administrative Code provision. We affirm the judgment of the court
5
of appeals on this issue. This cause is remanded to the trial court for further
6
proceedings not inconsistent with this opinion.
7

Judgment affirmed in part,
8

reversed in part and
9

cause
remanded.
10

DOUGLAS, RESNICK and F.E. SWEENEY, JJ.,
11

MOYER, C.J., WRIGHT and COOK, JJ., dissent.
12
Cook, J., dissenting. I respectfully dissent from that portion of the majority's opinion that
13
reverses the summary judgment granted in favor of Marathon Oil Co. ("Marathon") on
14
issues related to strict products liability and failure to warn. In arriving at its conclusion
15
that summary judgment was improperly awarded to Marathon at the trial court level, the
16
majority appears to bypass the primary step of determining whether Marathon is a
17
manufacturer of vapor recovery systems ("VRS") within the meaning of R.C. 2307.71(I).
18
Because the evidence placed before the trial court compels a conclusion that Marathon is
16

1
not a manufacturer of VRS within the meaning of R.C. 2307.71(I), I would affirm the
2
appellate court's opinion in all respects.
3

As defined in R.C. 2307.71(I), a "manufacturer" is "a person engaged in a
4
business to design, formulate, produce, create, make, construct, assemble or rebuild a
5
product or a component of a product." (Emphasis added.) The language employed in
6
R.C. 2307.71(I) is directly imported from Section 402A of the Restatement of Torts 2d
7
(1965) 347-348, and is consistent with the Restatement's public policy designs.
8

In supplying the requirement that one must be "engaged in a business" in order to
9
be classified as a manufacturer and concomitantly to become subject to the particularized
10
liability scheme of R.C. 2307.71 through 2307.80, it is clear that the legislature intended
11
to exclude the occasional seller. The public policy rationale that supports the imposition
12
of particularized burdens upon manufacturers of products evinces an intent to allocate the
13
costs of accidental injuries caused by defective products intended for resale upon those
14
who launch such products into the marketplace. Such manufacturers are expected to
15
stand behind their product and may insure against this potential liability and treat the
16
same as a cost of production. See Comments c and f to Section 402A of the Restatement
17
of Torts 2d, supra, at 349-351. Such policy considerations are clearly inapplicable to an
18
occasional seller, by whom sale of a product is isolated and merely incidental to the
19
business in which it is engaged.
20

The unrebutted evidence placed before the trial court was that Marathon designed
21
the VRS unit in question solely for use at four bulk plants owned and operated by
17

1
Marathon. No evidence was before the trial court that Marathon ever sold or offered the
2
VRS unit or VRS design for sale other than in connection with a sale or disposition of the
3
bulk plants wherein the VRS unit originally had been installed. In the absence of any
4
evidence demonstrating that Marathon's design, construction and eventual sale of the
5
VRS unit to Keneco was anything but incidental to an occasional bulk sale of one of its
6
plants, I believe that the majority's further analysis related to Marathon's asserted liability
7
under R.C. 2307.71 through 2307.80 is unwarranted.
8

Accordingly, I would affirm the appellate court's opinion in all respects.
9

MOYER, C.J., and WRIGHT, J., concur in the foregoing dissenting
10
opinion.
11

18