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Zaza v. Marquess and Nell

May 9, 1996

GERARDO ZAZA AND FRANCES ZAZA, HIS WIFE, PLAINTIFFS-RESPONDENTS,
v.
MARQUESS AND NELL, INC., A CORPORATION D/B IN NEW JERSEY; CALGON CARBON COMPANY, A COMPANY D/B IN NEW JERSEY; WILLIAM MERZ; AND BRENNAN COMPANY, INC., A COMPANY D/B IN NEW JERSEY, DEFENDANTS, AND INTERNATIONAL SHEET METAL & PLATE MFG., INC., A NEW JERSEY CORPORATION, DEFENDANT-APPELLANT.



On appeal from the Superior Court, Appellate Division.

Chief Justice Wilentz and Justices Pollock and Stein join in Justice GARIBALDI's opinion. Justice Coleman filed a separate opinion Concurring in part and Dissenting in part in which Justices Handler and O'hern join. The opinion of the Court was delivered by Garibaldi, J.

The opinion of the court was delivered by: Garibaldi

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).

GERARDO ZAZA, ET AL. V. MARQUESS AND NELL, INC., ET AL. (A-63)

Argued January 3, 1996 -- Decided May 9, 1996

GARIBALDI, J., writing for a majority of the Court.

The issue on appeal is whether under the Products Liability Act (PLA) a component part fabricator that builds a system component in accordance with the specifications of the owner, which component is not dangerous until it is integrated into the larger system, can be held strictly liable to an injured employee for the failure of the owner, installer-assembler, and training consultant to install safety devices and provide warnings.

On January 28, 1990, Gerardo Zaza, an employee of Maxwell House Coffee (Maxwell House), was severely injured when hot molten water and carbon within a quench tank that he was attempting to repair overflowed and landed on his back, arms and upper extremities, causing second degree burns over twenty-one percent of his body. The quench tank is an integral component part of a large, complex manufacturing process -- the Maxwell House trecar-carbon regeneration system -- which is used to produce decaffeinated coffee beans.

The initial designs for the quench tank were prepared by Maxwell House and were submitted to the engineering firm of Marquess and Nell, Inc. (Marquess), who prepared the final design plans. Marquess contracted with International Sheet Metal and Plate Mfg., Inc. (International) for a fabricated quench tank. Maxwell House hired Brennan Company, Inc. (Brennan) to assemble and integrate the trecar-carbon regeneration system. Calgon Carbon Company (Calgon) was hired to prepare training materials on how to operate the system and to educate Maxwell House employees in the use of the system. William J. Merz, an engineer employed by Calgon, conducted a training session for Maxwell House employees on how to use the trecar-carbon regeneration system, including the quench tank. Zaza attended that training session.

The final plans and specifications for the trecar-carbon regeneration system incorporated three safety devices designed to avoid an overflow of the molten fluid out of the quench tank. These safety devices were to be installed by Maxwell House and Brennan. At the time Zaza was injured, however, the safety devices had not been installed because Maxwell House had decided to omit them. The specifications on which International bid for the quench tank did not require that International prepare or install any safety devices. The specifications required only that the fabricator cut holes in the stainless steel tank for the safety devices. When the tank was delivered to Maxwell House, professional installers had to connect piping to it before the quench tank became operational.

In June 1991, Zaza filed suit against Marquess, Calgon, Merz, Brennan and International. As to International, Zaza alleged that strict liability should be imposed because the quench tank was defectively designed and lacked adequate warnings. On International's motion for summary judgment, the trial court dismissed the claims against International, finding that International had performed as required under the specifications given to them by the designer; had no supervisory responsibility over installation; was not required to install the safety devices; and had no duty to warn intended users of the quench tank.

Zaza appealed to the Appellate Division from the order granting summary judgment in favor of International. A majority of the Appellate Division reversed the grant of summary judgment in favor of International and remanded the matter to the trial court. The majority found that International had a duty to furnish a safe product, the breach of which triggered strict liability; that International's understanding that Maxwell House would install the safety devices did not relieve it from potential liability; that International had a duty to warn foreseeable users of the omission and of the dangers of operating the quench tank prior to the installation of the safety devices. The Dissenting member of the appellate panel did not agree that it was reasonable to hold a sheet metal fabricator strictly liable for a tank that it built in full accordance with the plans and specifications supplied by the assembler. Moreover, because Maxwell House was obligated to install the required safety devices before putting the tank into operation, a warning by International was not necessary.

International appeals to the Supreme Court as of right based on the Dissent in the Appellate Division.

HELD: A fabricator of a component part who builds a component of a system in accordance with the specifications of the owner, which component part itself is not defective and is not dangerous until it is integrated into the larger system, has no legal duty to ensure that the owner and installer-assembler properly integrated the component into the system. So long as the specifications were not obviously dangerous, a fabricator of component parts is not strictly liable to an injured employee of the owner under the Products Liability Act.

1. Under the PLA, the ultimate question to be resolved in design-defect and failure-to-warn cases is whether the manufacturer acted in a reasonably prudent manner in designing and fabricating a product. When a component part is subject to further processing, or where the causing of the injury is not directly attributable to any defect in the component part, the fabricator is typically not subject to strict liability. A manufacturer of a component part, which is not dangerous until it is integrated by the owner into a larger system, cannot be held strictly liable to an injured employee for the failure of the owner and/or assembler to install safety devices, so long as the specifications provided are not so obviously dangerous that it would be unreasonable to follow them and so long as the manufacturer was not substantially involved in the design of the final integrated product. (pp. 10-20)

2. The parties' affidavits, deposition, testimony, and other documents demonstrate that International had no duty to install the safety devices on the quench tank before the tank left its control. There is no allegation there was any manufacturing defect in the quench tank itself. It was not feasible, practical, or reasonable for International, a sheet metal fabricator with no prior experience in the assembly and installation of trecar-carbon regeneration systems, to attach the safety devices to the quench tank, nor could the devices have been incorporated into the tank at International's factory. Moreover, the work performed by Maxwell House and its assemblers in order to integrate the quench tank into the trecar-carbon regeneration system constituted a substantial change to the quench tank. International manufactured the quench tank in strict accordance with the specifications provided by Maxwell House, a knowledgeable and experienced purchaser and user. International was not the designer, manufacturer, or installer of the trecar-carbon regeneration system. International acted in a reasonably prudent manner in delivering the tank to Maxwell House without safety devices and in relying on Maxwell House and it's experienced assemblers to properly install the tank into the complicated system. Maxwell House retained complete control over the entire system, not International. Under those circumstances, International is not strictly liable for its failure to install the safety devices on the quench tank. (pp. 20-24)

3. The manufacturer of the component part, not dangerous in and of itself, does not have a duty to warn an employee of the immediate purchaser of the component where the immediate purchaser is aware of the need to attach safety devices. Holding International liable would impose on a component part manufacturer the duty to investigate whether the use of its non-defective product would be made dangerous by the integration of that product into the complex system designed and installed by experts. In failing to provide a warning on the use of the quench tank, International acted as a reasonably prudent person in the same and similar circumstances would have acted. The duty to warn does not extend to the speculative anticipation of how component parts that are not defective can become potentially dangerous, depending on the nature of their integration into a complex system designed and assembled by others. Because the quench tank was not defectively designed and International had no duty to warn, International's motion for summary judgment should have been granted. (pp. 24-34)

Judgment of the Appellate Division is REVERSED and summary judgment is GRANTED in favor of International.

JUSTICE COLEMAN, Concurring in part and Dissenting in part, in which JUSTICES HANDLER and O'HERN join, Dissents only from that portion of the Court's opinion that holds International had no duty to place a warning on the quench tank to alert intended users of dangers inherent in its use without safety devices. According to Justice Coleman, whenever, as in this case, a jury can find that it is objectively foreseeable that an owner might use a product in a manner inconsistent with its intended purpose, such as by falling to install safety devices, then the manufacturer of component parts has the duty to warn the owner's employees, provided that warning could have prevented or reduced the likelihood of an accident. Therefore, it was feasible for International to have attached a warning to the quench tank to caution intended users of the inherent dangers associated with using the tank for its intended purpose in the event Maxwell House failed to install the safety devices.

CHIEF JUSTICE WILENTZ and JUSTICES POLLOCK and STEIN join in JUSTICE GARIBALDI's opinion. JUSTICE COLEMAN filed a separate opinion Concurring in part and Dissenting in part in which JUSTICES HANDLER and O'HERN join.

The opinion of the Court was delivered by GARIBALDI, J.

This appeal presents the question of whether under the Products Liability Act, N.J.S.A. 2A:58C-1 to -7, a component part fabricator that builds a system component in accordance with the specifications of the owner, which component is not dangerous until it is integrated into the larger system, can be held strictly liable to an injured employee for the failure of the owner, installer-assembler, and training consultant to install safety devices and provide warnings. The Appellate Division found that such a fabricator could be held strictly liable. We now reverse.

I

On January 28, 1990, plaintiff Gerardo Zaza *fn1, an employee of Maxwell House Coffee (Maxwell House), a division of General Foods Manufacturing Corporation, discovered a clog in a quench tank located in the Hoboken plant. While working to repair the quench tank, hot molten water and carbon within the quench tank overflowed and landed on plaintiff's back, arms and upper extremities, causing second degree burns over twenty-one percent of plaintiff's body.

The quench tank is an integral part of a large, complex manufacturing process -- the Maxwell House trecar-carbon regeneration system -- which is used to produce decaffeinated coffee beans. The system contains a multiple hearth furnace, a quench tank, and numerous pipes, watering screws, scrubbers and fans. All of those parts must be fully integrated and assembled in order to create a properly working trecar-carbon regeneration system. It is a two-fold system. In the top portion of the system, the ultimate coffee product is made, and a byproduct (carbon) is reclaimed in the lower portion. The quench tank is located in the lower portion where the carbon regeneration process takes place. After the basic coffee product has been made in the top portion, the carbon, which has been heated in the multiple hearth furnace to 1700 degrees fahrenheit, leaves the furnace through a large tube and enters the quench tank. At the same time the molten carbon enters the quench tank, cool water is pumped into the quench tank at the rate of twenty-two gallons per minute. The superheated carbon-water mixture moves through the quench tank for approximately thirty minutes, then exits the tank through two pipelines, and finally comes to rest in separate storage tanks where it is kept for future processing.

The initial designs for the quench tank were prepared by Maxwell House and were submitted to the engineering firm of Marquess and Nell, Inc., (Marquess) who prepared the final design plans. Marquess contracted with defendant International Sheet Metal & Plate Mfg., Inc. (International) for a fabricated quench tank. Maxwell House hired Brennan Company, Inc. (Brennan) to assemble and integrate the trecar-carbon regeneration system. Calgon Carbon Company (Calgon) was hired to prepare training materials on how to operate the system and to educate Maxwell House employees in the use of the trecar-carbon regeneration system. William J. Merz, an engineer employed by Calgon, conducted a training session for Maxwell House employees on how to use the trecar-carbon regeneration system, including the quench tank. Plaintiff attended the training session.

The specifications on which defendant bid for the quench tank did not require that the fabricator prepare or install any safety devices. Rather, the specifications called for the fabricator to cut holes for the safety devices. The quench tank fabricated by defendant is best described as a stainless steel tank with holes in it. The tank also contains six flanges, which are devices used to hold pipes in place. The quench tank was sold to Maxwell for $7,400. When it was delivered to Maxwell House, professional installers had to connect water ingress piping, carbon extrusion piping and water discharge piping before it could be made operational.

The final plans and specifications for the trecar-carbon regeneration system incorporated three safety devices designed to avoid an overflow of the molten fluid out of the quench tank. These safety devices were to be installed by Maxwell House and Brennan. The devices included a spectacle shut-off valve, a high-level fluid sensor, and an overflow pipe. The spectacle shut-off valve was designed to stop the flow of the molten carbon from leaving the hearth furnace and entering the quench tank whenever personnel were working on the quench tank or associated piping. It was supposed to be located in the chute between the hearth furnace and the quench tank. The high-level fluid sensor was designed to trigger an alarm and light whenever the fluid level in the quench tank reached a dangerous level. The overflow pipe was to be located eight inches below the top of the quench tank and was designed to divert the fluids within the quench tank through a piping system to another location away from the user if the fluids reached a high level within the tank. It is uncontroverted that the installation of the overflow pipe would have prevented the quench tank from pouring out its molten contents on plaintiff.

Although all three safety devices were included in the design plans prepared by Marquess, none was actually in operation at the time plaintiff sustained his injuries. Brennan, the installer, claims that its function was to install and integrate the quench tank into the system based on the plans provided to it by Maxwell House, that Maxwell House decided to omit the safety devices recommended by Marquess, and that Maxwell House approved the installation. Maxwell House's decision to omit the safety devices appears to have been deliberate. Although the spectacle shut-off valve was on site and available when the tank was being installed, Maxwell House chose not to install it. When an engineer informed Maxwell House of the omission, the company chose to disregard the advice.

In June 1991, plaintiff filed this action against Marquess, Calgon, William J. Merz, Brennan, and International. The complaint against International alleged that strict liability should be imposed because the quench tank was defectively designed and lacked adequate warnings.

Motions for summary judgment were filed by Marquess, Calgon, its employee William J. Merz, and International. Plaintiff filed a motion for summary judgment, opposed defendants' motions for summary judgment and simultaneously cross-motioned for summary judgment as to defendants Marquess and International.

During oral argument on the motions for summary judgment, the trial court attempted to sort out the responsibilities of the designer (Marquess), fabricator (International), training consultant (Calgon) and installer-assembler (Brennan). With respect to International's legal responsibility, the court found that:

[Defendant] doesn't create the spectacle shutoff system, the high liquid sensor device, or the overflow pipe system. He tells me he's the fabricator who makes the holes for them.... And here's a sheet metal guy who prepares pieces of sheet metal that he submits to an installer who puts them together at the site, and he's got all the holes in them. And you're [plaintiff's counsel] saying that he's got a non-delegable duty to the consumer or to the injured party to see to it that the installer puts it in, the manufacturer install his sheet metal properly before it is functional; is that what you're saying?

In granting International's motion for summary judgment, the court reasoned:

With respect to Defendant International, the colloquy that we've had, the Discussion we've had on the record is very enlightening and illuminating because it does not appear that the manufacturer of sheet metal that is not the manufacturer of an integrated machine should be held to the same degree of responsibility that one who manufactures a total machine and that machine when it's put into the stream of commerce creates injury should be held to. The standard for an individual who creates a component part of a machine is whether or not they have properly manufactured that component part. The plaintiff's expert does not indicate that any part of the sheet metal itself, the work done by International caused this unit to be used without the proper safety devices. Therefore, I don't find that there is any material issue of fact with respect to the work that was done by International. Therefore, the motion for the Summary Judgment is granted with respect to International.

At a hearing on a motion for reconsideration, the trial court further elaborated on its rationale for granting International's motion for summary judgment. With respect to the design defect, the court opined:

It was uncontroverted that International Plate Metal did do whatever design they were required to perform, whatever fabricating of the holes and cutouts that were required in the specifications that were given to them by Marquess & Nell, the designer. There was never any suggestion that International Sheet Metal & Plate Manufacturer was responsible for supervision of the installation. They merely had to do their work and thereafter others were required to install all of the pipes and the safety devices, and the fittings, and the sealants that were necessary to make this skeleton a viable component in this overall unit.

Concerning the alleged failure to warn, the court found:

The plaintiff says the defendant failed to provide warnings. There was no way that the fabricator could even know what the final looks of that machine would be or what type of use the machine would entail or what component parts would be added to that tank in order to make it into a manufacturing instrument, into an operative working unit.

Brennan, and Calgon settled. Plaintiff then appealed to the Appellate Division from the order granting summary judgment in favor of International. In his appeal, plaintiff argued that the quench tank was "defective" under N.J.S.A. 2A:58C-2 because: (1) defendant deviated from the design specifications by not incorporating an overflow pipe into the quench tank; (2) defendant failed to provide adequate warnings to Maxwell House and plaintiff; and (3) the quench tank was unsafe for its intended purpose.

The Appellate Division, by a 2-1 majority, reversed the grant of summary judgment in favor of International and remanded the matter to the trial court for further proceedings. According to the Appellate Division majority, whether the quench tank was a complete product or a component part in the trecar-carbon regeneration system was irrelevant. The majority explained that:

[International] had a duty to furnish a safe product, the breach of which triggers strict liability. ... The fact that defendant may have understood that Maxwell House would install the safety devices in the holes it cut did not relieve defendant from potential liability. . . . That fact only relates to the issues of proximate cause.

According to the majority, if installation was not feasible or premature, defendant had a duty to warn foreseeable users -- Maxwell House and Maxwell House employees -- of the omission and of the dangers of operating the ...


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