Opinion
No. 24018
November 13, 2001
APPEAL FROM CIRCUIT COURT OF STODDARD COUNTY, HON. STEPHEN R. SHARP.
Mark E. Harris and Jack W. Green, Jr., for Appellant.
James E. Spain and Hardy C. Menees, for Respondent.
Opinion
Appellant Green Supply, Inc. ("Wholesaler") appeals the denial of its motions for directed verdict and motion to set aside verdict and judgment (JNOV), after a jury trial arising out of Respondent Gramex Corporation's ("Seller") amended cross-claim for contribution against Wholesaler. See Rule 52.11.
All rule references are to Missouri Court Rules (2001), unless otherwise set out.
As explained more fully below, Seller initially brought its cross-claim against Wholesaler for indemnity and then amended its cross-claim to include contribution. At trial, the court instructed the jury only on Seller's claim for contribution against Wholesaler. The jury returned a verdict finding Seller's damages at $l.25 million dollars, disregarding any fault on the part of Seller, and assessed 50% fault each to Seller and Wholesaler. The trial court entered its judgment accordingly.
Seller does not appeal from the trial court's refusal to instruct on Seller's claim for indemnity against distributor. Only errors assigned and preserved are reviewed. See Germania Bank v. Thomas , 810 S.W.2d 102, 105 (Mo.App. 1991); Rule 84.13(a).
The record shows that Wholesaler is in the business of distributing various products, including hunting supplies and products, to retail concerns. It engaged in business with Seller who operated a concern known as Grandpa's in Ballwin, Missouri. At some point prior to October 3, 1996, Wholesaler sold Seller a product known as a "tree seat," used by hunters to position themselves above ground more comfortably. The tree seat was manufactured by Big Game Products Company, Inc., ("Big Game") using nylon straps provided by S.I.R. Webbing, Inc., ("S.I.R.") and sewn together by Jackster, Inc., ("Jackster").
On October 3, 1996, William Kent Dunn ("Mr. Dunn") purchased one of the tree seats from Seller that had been sold to Seller by Wholesaler. On October 12, 1996, Mr. Dunn fell approximately twenty feet while using the tree seat due to one of the nylon straps in the tree seat breaking apart. As a result, Mr. Dunn sustained catastrophic injuries, including injuries to his spinal cord and was paralyzed from the waist down. Mr. Dunn and his wife ("plaintiffs") filed suit against Wholesaler, Seller, Big Game, S.I.R., and Jackster, alleging various theories of negligence and strict liability. Prior to trial and after lengthy discovery, plaintiffs offered to settle with Wholesaler and Seller for the amount of $1.25 million dollars. Wholesaler refused to settle. Seller agreed to settle with plaintiffs provided the settlement agreement would also satisfy and extinguish plaintiffs' claims against both Seller and Wholesaler. This was accomplished without any further participation by Wholesaler. Shortly thereafter plaintiffs reached settlement agreements with Big Game, S.I.R., and Jackster. Seller then filed its cross-claim against Wholesaler seeking indemnity for the amount paid by Seller in its settlement of plaintiffs' claims together with fees and costs.
In its cross-claim, Seller set out that Wholesaler had sold it a "defective product," and thereby "subjected [Seller] to liability to Plaintiffs" and that it was "entitled to be indemnified for all losses suffered . . . as a result of purchasing the defective product from [Wholesaler]", because it was "lower in the chain of distribution of the hunting seat than [Wholesaler]. . . ." Prior to trial, Seller was permitted to amend its cross-claim by interlineation to include a claim for contribution against Wholesaler. The phrase "or contribution" was placed immediately after the word "indemnity" wherever it appeared in the text of the cross-claim. However, no additional factual allegations were added to the amended cross-claim ("cross-claim") against Wholesaler.
Wholesaler seasonably filed its answer generally denying Seller's inculpating allegations against it. Wholesaler, inter alia, affirmatively pled that Seller had "no legal obligation to make the payments . . . in the amounts alleged," and "acted as a volunteer" in so doing. Furthermore, Wholesaler maintained that plaintiffs' settlements with Big Game, S.I.R., and Jackster in the underlying action "extinguished liability, if any of [Wholesaler] and [Seller] pursuant to common law and pursuant to Section 537.762 RSMo." It also affirmatively set out that it had "no liability to Plaintiffs or any other party other than liability based solely on its status as a seller in the stream of commerce." Additionally, Wholesaler set out that Seller was neither entitled to contribution nor indemnity and that Seller could receive full recovery from parties "upstream" from Wholesaler. Lastly, Wholesaler set out that Seller was "independently and primarily negligent in various respects, including . . . the manner in which it displayed the tree seat and its continued sale of the tree seat in boxes that lacked a warning. . . ." Accordingly, Wholesaler argued that since a party is not entitled to indemnity against the consequence of its own negligence, Seller was not entitled to indemnity from Wholesaler.
The apparent purpose of section 537.762 is to allow a seller in the stream of commerce to be released at an early stage in the litigation, rather than waiting until completion of litigation to obtain indemnity. Malone v. Schapun, Inc ., 965 S.W.2d 177, 182 (Mo.App. 1997). "Section 537.762, by its very terms, does not change the substantive law relating to an innocent seller's liability; as its effect is only procedural." Id .
All statutory references are to RSMo 2000, unless otherwise set out.
At trial, Wholesaler seasonably filed its motions for directed verdict after the close of Seller's case and the close of all the evidence. These motions were denied. The trial court also denied Wholesaler's motion for JNOV. Wholesaler raises three points in its appeal. Since Point One is dispositive it alone will be reviewed.
I.
In Point One, Wholesaler asseverates that the trial court erred by not granting its motions for directed verdict and motion for JNOV. It asserts that Seller failed to allege any facts in its amended cross-claim relating to the relative fault or negligence of Wholesaler and failed to allege any facts concerning Seller's own relative fault or negligence as a joint tortfeasor. Wholesaler maintains that these omissions doomed Seller's claim for contribution. Wholesaler's point has merit.
Wholesaler seeks review of the trial court's ruling denying its motions for directed verdict as well as its motion to set aside verdict and judgment. We interpret this to include Wholesaler's motion for directed verdict at the close of Seller's evidence as well as its motion for directed verdict at the close of all evidence. "A defendant who moves for a directed verdict at the close of the plaintiff's evidence, receives an adverse ruling, and thereafter presents evidence, waives any error in the denial of the motion." St. Francis Med. Ctr. v. Penrod , 937 S.W.2d 343, 346 (Mo.App. 1996). Accordingly, we will not review Wholesaler's point as it may relate to denial of its motion for directed verdict at the close of Seller's evidence. Id . However, "when a defendant does not stand on his motion for directed verdict at the close of the plaintiff's evidence, the reviewing court examines all of the evidence in determining the sufficiency of the plaintiff's case." Egelhoff v. Holt , 875 S.W.2d 543, 551 (Mo. banc 1994).
We now turn to the standard of review regarding Wholesaler's appeal arising from the trial court's denial of its motion for directed verdict at the close of all evidence, along with its motion for JNOV.
"The standard of review of denial of a JNOV is essentially the same as for review of denial of a motion for directed verdict." Giddens v. Kansas City Southern Ry. Co. , 29 S.W.3d 813, 818 (Mo.banc 2000). "On appeal from a judgment notwithstanding the verdict, appellate courts review the evidence and reasonable inferences favorable to the jury verdict and disregard contrary evidence that does not support the verdict." Lewis v. Fag Bearings Corp. , 5 S.W.3d 579, 581 (Mo.App. 1999); PJ's Concrete Const., Inc. v. Gust , 983 S.W.2d 640, 642 (Mo.App. 1999). "A defendant's motion for judgment notwithstanding the verdict should be granted only where the plaintiff failed to make a submissible case." Lewis , 5 S.W.3d at 581. "'To make a submissible case, substantial evidence is required for every fact essential to liability.'" PJ's Concrete , 983 S.W.2d at 642 (quoting Steward v. Goetz , 945 S.W.2d 520, 528 (Mo.App. 1997)). "A motion for judgment notwithstanding the verdict should be granted if an essential element in the cause of action is not supported by substantial evidence." Stewart v. Kirkland , 929 S.W.2d 321, 322 (Mo.App. 1996).
II.
"It is well established in case law that the cause of action asserted by a third party plaintiff, whether based on contribution, indemnification on some other theory of recovery, is separate and distinct from the tort claim asserted by the plaintiff against the defendant." State ex rel. General Elect Co. v. Gaertner , 666 S.W.2d 764, 766 (Mo.banc 1984).
Although contribution and indemnity or partial indemnity have been used interchangeably, the terms contribution and indemnity represent different concepts. 'There is an important distinction between contribution, which distributes the loss among the tortfeasors by requiring each to pay his proportionate share, and indemnity, which shifts the entire loss from one tortfeasor who has been compelled to pay it to the shoulders of another who should bear it instead.'
Safeway Stores, Inc. v. City of Raytown , 633 S.W.2d 727, 729 n. 3 (Mo.banc 1982) (quoting W. Prosser, Law of Torts, section 51 at 310 (4th ed. 1971)); see Stephenson v. McClure , 606 S.W.2d 208, 210-11 (Mo.App. 1980).
"Contribution among joint tortfeasors was first adopted in Missouri in Missouri Pacific R.R. Co. v. Whitehead Kales Co ., 566 S.W.2d 466 (Mo.banc 1978)." Ferrellgas, L.P. v. Williamson , 24 S.W.3d 171, 177 (Mo.App. 2000); see also section 537.060. It is joint liability, not a joint judgment, that is a prerequisite to contribution. McNeill Trucking Co., Inc. v. MHTC , 35 S.W.3d 846, 847 (Mo.banc 2001); Safeway , 633 S.W.2d at 730; Whitehead , 566 S.W.2d at 469; Stephenson , 606 S.W.2d at 213.
" Whitehead and Kales involved a claim and attempted interpleader predicated on negligence." Gaertner , 666 S.W.2d at 768. There the court stated that "'the right of non-contractual indemnity presupposes actionable negligence of both parties toward a third party.'" Id . (quoting Whitehead Kales , 566 S.W.2d at 468). Stephenson set out that " Whitehead and Kales introduced a fundamental change in Missouri law. In very general terms, that case upon the 'principle of fairness' established the doctrine of non-contractual indemnity or contribution upon the basis of relative fault between or among joint tortfeasors." 606 S.W.2d at 211 (emphasis added). Stephenson further observed that the "doctrine of Whitehead and Kales cuts across the separate concepts of indemnity and contribution," id . at 214, and appears to equate the terms "non-contractual indemnity" with that of "contribution." Id . at 211, 214. Ferrellgas, L.P . tacitly does so as well; see Witt v. Austin , 806 S.W.2d 63, 67 (Mo.App. 1991). Compare, Irwin v. Hoover Treated Wood Products, Inc. , 906 F. Supp. 530, 533 n. 2 (E.D.Mo. 1995) ("Under Missouri law, a claim for indemnity may be maintained in one of two ways: an express agreement to indemnify or an implied (non-contractual) agreement to indemnify,"); see In re Broadview Lumber Co., Inc. , 168 B.R. 941, 966-67 (Bkrtcy. W.D. Mo. 1994); compare also Restatement Third, Torts: Indemnity section 22 and Restatement Second, Torts: Indemnity Between Tortfeasors section 886B(2)(d), and attendant comments.
"Prior to Whitehead Kales , the only right to contribution among tortfeasors was that granted by section 537.060 . . . providing for contribution among tortfeasors who were 'defendants in a judgment.'" Gaertner , 666 S.W.2d at 765. "This statutory right to contribution was available only after the entry of judgment against the defendants." Id .; see also Restatement Third, Torts: Contribution and Indemnity section 23, Reporter's Note at page 292.
"The term contribution is preferable when referring to apportionment of loss or damages between joint or concurrent tortfeasors." Safeway , 633 S.W.2d at 729 n. 3. "The right to contribution is based upon the principle of fairness, and, while historically afforded in equity, it has subsequently been enforced at law under a variety of legal theories to rectify unjust enrichment." McNeill Trucking , 35 S.W.3d at 847; see also Restatement Second, Torts: Contribution Among Tortfeasors section 886A.
"In the absence of actionable negligence toward the plaintiff, an alleged tortfeasor is not liable to other defendants for contribution." Sweet v. Herman Bros., Inc ., 688 S.W.2d 31, 32 (Mo.App. 1985). "Unless the plaintiff has (or had) a cause of action against the person from whom contribution is sought, that person is not liable for contribution to other defendants." Id . at 33; Coello v. Tug Mfg. Corp ., 756 F. Supp. 1258, 1265 (W.D.Mo. 1991); see also Restatement Third, Torts: Contributions section 23.
"In order to constitute actionable negligence there must exist three essential elements, namely, a duty or obligation which the defendant is under to protect the plaintiff from injury; a failure to discharge that duty; and injury resulting from the failure. Not only must the complaint disclose these essentials, but the evidence must support them and the absence of proof of any of them is fatal to a recovery." Zitzmann v. Glueck Box Co ., 276 S.W. 23, 25 (Mo. 1925); see Biscoe v. Kowalski , 290 S.W.2d 133, 138 (Mo. 1956).
Section 23 Contribution, reads as follows:
(a) When two or more persons are or may be liable for the same harm and one of them discharges the liability of another by settlement or discharge of judgment, the person discharging the liability is entitled to recover contribution from the other, unless the other previously had a valid settlement and release from the plaintiff.
(b) A person entitled to recover contribution may recover no more than the amount paid to the plaintiff in excess of the person's comparative share of responsibility.
(c) A person who has a right of indemnity against another person under section 22 does not have a right of contribution against that person and is not subject to liability for contribution to that person.
"Negligence is not an element of a products liability case." Welkener , 734 S.W.2d at 241; see also Lippard v. Houdaille Industries, Inc. , 715 S.W.2d 491, 492 (Mo.banc 1986). Nevertheless, the court in Welkener observed that:
"The current negligence standard in Missouri sets forth that a seller of a product who neither knows nor has reason to know the product is dangerous is not liable in a negligence action for harm caused by the product's dangerous condition because of the seller's failure to discover the danger by an inspection or test of the product before selling it." Dorman v. Bridgestone/Firestone, Inc ., 992 S.W.2d 231, 239 (Mo.App. 1999); see Restatement Second, Torts: Suppliers of Chattels section 402; see also Welkener 734 S.W.2d at 241 (under foregoing circumstances, Seller is entitled to indemnity against one higher in the chain, such as manufacturer). "However, if the defect is such that a reasonably prudent seller should have discovered it before selling the product to the consumer, the seller may be held liable for the injuries caused by the defect." Dorman , 992 S.W.2d at 239; Welkener , 734 S.W.2d at 241.
[u]nder the philosophy of the Missouri decisions, we state only that the doctrines of indemnity and contribution are applicable in strict products liability cases. . . . However, to be entitled to utilize these principles, they must, as in other cases, be pleaded and proved by proper allegations and substantial evidence.
Id . at 243. Despite the foregoing broad language, Welkener gave recognition to Judge Rendlen's observation — concurring in result in Gaertner , 666 S.W.2d at 768 — that "[a]pparently no Missouri court has ever determined that the seller of a defective product held strictly liable in tort has a claim for (partial) contribution predicated on strict liability against his supplier." Welkener , 734 S.W.2d at 243. "Authorities suggest that if such claim exists, it is one for (full) indemnity not (partial) contribution." Id .
Seller has not called our attention to any case in Missouri in which the Seller of a defective product held strictly liable in tort has a claim for contribution predicated on strict liability against his supplier. In our independent research we have found none.
In Welkener , the court determined that a crutch manufacturer had failed to plead and prove, in response to crutch seller's third-party petition for indemnity or contribution, any fault on the part of seller before it rented crutches to consumer who was subsequently injured. Id . at 244.
The court noted that crutch manufacturer's failure to allege any duty on part of seller to inspect crutches it rented, precluded manufacturer from seeking contribution against seller under the doctrine of relative fault. Id .
Similarly, in Stephenson , amended cross-claim plaintiff ("McClure") settled with victim for injuries received by her arising from an automobile accident, due to the concurrent negligence of himself and cross-claim defendant ("Killian"). In pursuing his amended cross-claim for contribution against concurrent tortfeasor Killian, McClure alleged that victim's injuries were the "direct and proximate result of negligence of [Killian]". Id . at 210. "It was held that this pleaded McClure out of court." Witt , 806 S.W.2d at 67. "It is a well-recognized rule that one seeking contribution as a joint tortfeasor must allege that he was a joint tortfeasor." Stephenson , 606 S.W.2d at 213; see Welkener , 734 S.W.2d at 243.
In the case at bar, as in Stephenson , in its cross-claim Seller made a claim for contribution against Wholesaler. However, Seller failed to make any allegations that it was in any way negligent toward plaintiffs when it sold the tree seat to plaintiffs. "While it may seem anomalous to require a pleader to assert his own liability, that element is fundamental to the doctrine of Whitehead and Kales ." Stephenson , 606 S.W.2d at 213. "It is fundamental that a pleading seeking relief must 'contain (1) a short and plain statement of the facts showing that the pleader is entitled to relief.'" Id . (quoting V.A.M.R. Civil Rule 55.05). This applies equally to "an original claim, counterclaim, cross-claim, or third party claim." Rule 55.05. "The pleading must allege the factual elements a pleader must prove to prevail." Stephenson , 606 S.W.2d at 213. In failing to do so, Seller "literally [pled] himself out of court." Id . "[A] party who seeks the benefit of a doctrine of contribution, must nevertheless plead facts which invoke that doctrine." Id.; Witt , 806 S.W.2d at 67. Furthermore, at trial, Seller presented no evidence showing that either it or Wholesaler had been actionably negligent in any manner. The trial court erred when it failed to sustain Wholesaler's motion for directed verdict and motions for JNOV. Stephenson , 606 S.W.2d at 213-14; Welkener , 734 S.W.2d at 244; Giddens , 29 S.W.3d at 818.
"Cases are reviewed in the appellate courts on only the theory upon which they are tried in the trial courts." Schmidt v. Warner , 955 S.W.2d 577, 584 (Mo.App. 1997). "[I]t is not the duty, and indeed it would be improper, for this court to assume the position of an advocate and to search for any other theory upon which the cross-claim could be maintained." Stephenson , 606 S.W.2d at 211.
Seller's verdict director, modeled on M.A.I. 25.04 (modified), directed the jury to assess a percentage of fault against Wholesaler on the basis of proof of strict liability only and not negligence.
The judgment is reversed.
Shrum, P.J., Montgomery, J., and Barney, C.J., concur.