Nationwide Mutual Insurance Co. v. Barton Solvents, Inc.
2014 SD 70
| S.D. | 2014Background
- A.H. Meyer operates a honey and beeswax plant in Winfred, South Dakota; explosions occurred due to heptane vapors ignited by electrical switches.
- Barton Solvents sold heptane to A.H. Meyer for over twenty years and delivered to a 10,000 gallon tank outside the plant; liquid spilled and vapors formed inside a kettle.
- A.H. Meyer installed ventilation to remove vapors; Barton Solvents provided CITGO’s MSDS with each delivery warning of flammability and ignition risks, including that vapor may travel long distances and that adequate ventilation is required.
- NFPA 497 and NEC recommendations advised a five-foot spacing between ignition sources and heptane, to be applied with sound engineering judgment; plant reconstruction after a 2004 explosion moved switches to at least five feet away and above the floor.
- An explosion occurred in 2009 when a standard switch ignited vapors despite following the five-foot spacing; Nationwide hired experts, who suggested ventilation may have worsened vapor distribution.
- Nationwide sued Barton Solvents and CITGO for strict liability, negligence, and warranties, alleging inadequate warnings; circuit court granted summary judgment for defendants.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Adequacy of warnings under liability theories | Nationwide contends warnings were inadequate despite following five-foot NFPA/NEC guidance. | Warnings complied with MSDS/NEC/NFPA 497; accident alone is insufficient to prove liability without expert evidence of inadequacy. | Summary judgment upheld; warnings were not shown to be inadequate. |
| Express warranty by description | NFPA 497 illustrations and five-foot spacing created an express warranty that explosions would not occur if followed. | Warnings are guidelines, not affirmative guarantees; NFPA 497 was to be used with sound engineering judgment and did not promise safety. | No express warranty; NFPA 497 did not affirmatively guarantee safety. |
| Implied warranty of fitness for a particular purpose | Seller knew buyer would use heptane for beeswax rendering and relied on seller expertise; product might not be fit for that purpose. | No evidence heptane was not fit for rendering beeswax; ventilation issues did not prove nonfitness. | No breach; product was not shown unfit for the stated purpose. |
| Implied warranty of merchantability | Heptane not merchantable due to explosion and dangers not adequately contained or labeled. | No defect or mislabeling; warnings and packaging complied with standards. | No merchantability defect; explosion did not prove unmerchantable product. |
Key Cases Cited
- Jahnig v. Coisman, 283 N.W.2d 557 (S.D. 1979) (negligence requires reasonable warning disclosure in products)
- Burley v. Kytec Innovative Sports Equip., Inc., 737 N.W.2d 397 (S.D. 2007) (defendants' warnings must be evaluated for adequacy; causation and warning elements месту)
- Peterson v. Safway Steel Scaffolds Co., 400 N.W.2d 909 (S.D. 1987) (standard for warning adequacy in products liability context)
- James River Equip. Co. v. Beadle Cnty. Equip., Inc., 646 N.W.2d 265 (S.D. 2002) (purchase agreements may incorporate by reference to create express warranty by description)
- Crandell v. Larkin & Jones Appliance Co., 334 N.W.2d 31 (S.D. 1983) (fire in dryer case; distinguishes defective product from warning-based claims)
- Quinn v. Farmers Ins. Exch., 844 N.W.2d 619 (S.D. 2014) (summary judgment standard; evidentiary burden on plaintiff)