Sukljian v. Charles Ross & Son Co.

OPINION OF THE COURT Casey, J. On February 26, 1978, while employed at Ardex Corporation, a corporation owned by his father, plaintiff’s son injured his hand in the rollers of a high speed machine which he was then attempting to clean. Consequently, plaintiff sued defendant Charles Ross & Son Company, Inc. (Ross & Son), the manufacturer of the machine, and defendant K.M. Equipment Corporation (K.M.), the immediate seller of the machine to Ardex, in negligence, strict products liability and breach of warranty. Ensuing cross claims and third, fourth and fifth-party actions disclosed that the machine had initially been purchased from Ross & Son by third-party defendant General Electric Company on January 15, 1962. After various intermittent sales, the machine was sold to Ardex on April 28, 1976 by K.M. It appears that at the time of the original purchase in 1962, [11] General Electric directed Ross & Son to install thereon a feed hopper and a safety trip switch. The hopper made it possible to load a larger amount of material into the machine at one time and, insofar as it surrounded the center and rear rolling cylinders, it acted as a housing guard. The safety trip switch was a bar or chain running between two casings on either side of the rolling cylinders that caused the rollers to stop quickly when an employee tripped the switch by hand, but it would not release or separate the rollers. At the time of General Electric’s purchase of the machine in 1962, both these devices were optional equipment to a purchaser but became standard safety equipment in 1975. General Electric used the machine for 10 years and, in 1973, sent out invitations for bids on a sale, describing it as "surplus”, the machine to be sold as "As Is—Where Is”. Purchasers were urged to inspect the machine before bidding, and the price was apparently set by weight as for scrap metal. The machine was purchased from General Electric by Semco Equipment Company, a nonparty, for $35 in 1973. Although General Electric cannot state whether the safety devices above described were in place at the time of the sale by it, the president of K.M. has sworn that the machine did not contain the safety devices at the time K.M. received it and at the time of its sale to Ardex. General Electric’s motion for summary judgment to dismiss the third-party complaint and cross claims against it for legal insufficiency was granted by Special Term to the extent of dismissing the strict products liability and the breach of warranty causes of action. These cross appeals ensued. Special Term’s dismissal of the breach of warranty cause of action is not an issue on this appeal. In regard to Special Term’s dismissal of the cause of action alleging strict liability against it, General Electric argues that it only was an "occasional seller” of such equipment, and, since it was not engaged in the regular business of selling such products, it cannot be held in strict liability (citing Gobhai v KLM Royal Dutch Airlines, 85 AD2d 566, affd 57 NY2d 839). We agree. The policy considerations justifying extension of strict tort liability to sales of new products by commercial dealers do not apply with equal force to sales of used products (Strict Liability in Tort: Liability of Seller of Used Product, Ann., 53 ALR3d 337, 339). Obviously, such a dealer, as distinguished from one who sells new products, would have great difficulty in passing on the burden of liability to the original [12] manufacturer whose conduct may have been responsible for the defect. Since such policy considerations are lacking herein, strict tort liability should not be extended to General Electric’s sale of the used machine. General Electric was not in the business of selling surplus machinery and the sale by General Electric was specifically described in the invitation to bid as being on an "As Is—Where Is” basis (see, Wilkinson v Hicks, 126 Cal App 3d 515, 179 Cal Rptr 5; La Rosa v Superior Ct., 122 Cal App 3d 741, 176 Cal Rptr 224). The invitation also specifically urged the purchaser to inspect before buying and denied any warranties running to the surplus property being sold. The price was set by weight as for scrap and this machine was actually sold for $35. In these circumstances, we hold that the doctrine of strict tort liability is inapplicable as a matter of law (see, Restatement [Second] of Torts § 402 A. comment b [1965]) and affirm the dismissal of such cause of action by Special Term. We further agree that Special Term properly denied General Electric’s motion for summary judgment on the negligence claim. The fact that the machine was priced by General Electric for sale by weight as for scrap and sold for $35 does not preclude the existence of a factual issue that it was reasonably foreseeable that the machine would be kept in use and used as it was at the time it caused the injury to plaintiffs son. The safety devices were in place when General Electric first purchased the machine. General Electric representatives cannot state that the devices were still in place at the time of the sale by General Electric. At the time the machine was sold to Ardex, however, the devices had been removed. Thus, a factual issue exists as to whether the safety devices were removed while the machine was in General Electric’s possession. Accordingly, the portion of Special Term’s order granting third-party defendant General Electric Company’s motion for summary judgment dismissing the causes of action alleged against it for strict products liability should be affirmed, as should Special Term’s denial of General Electric’s motion dismissing the cause of action alleging negligence, which is the basis of the cross appeal.