ON PETITION TO TRANSFER FROM THE INDIANA COURT OF APPEALS, NO. 42A01-0109-CV-350.
Case Summary
Sustaining injury after slipping on a ramp attached 'to a home that he was visiting, Wayne Peters sued the contractor who installed the ramp. The trial court granted summary judgment in the contractor's favor on grounds that the "acceptance rule" precluded liability. On review the Court of Appeals reversed relying on an exception to the rule. Today we grant transfer and join those jurisdictions that have' abandoned what has been described as an outmoded relic. In so doing we reverse the Judgment of the trial court.
Facts and Procedural History
Earl and Avonda Hamm owned a home in Vincennes, Indiana. - Because Mr. Hamm was bedridden and because Mrs. Hamm's own ability to climb steps was declining, the Hamms decided to install a ramp on the front of their residence. A neighbor of the Hamms' daughter had constructed a ramp for his handicapped wife who had since passed away. Having no further use for the ramp, he sold it to the Hamms for less than a hundred dollars.
Donald Forster owned several rental 'properties and was the landlord of the Hamms' daughter. He also engaged in construction work as an independent contractor. By agreement with the Hamms, Forster transported the ramp from its original location to the Hamm residence where he and a few of his employees attached it to the front of the house with "a couple of serews." Appellants' App. at 85. Forster was aware the ramp did not meet
On March 15, 1999, Wayne Peters delivered a meal to the Harm residence. Using the ramp to enter the house Peters apparently encountered no difficulty. Upon leaving however, Peters slipped and fell sustaining serious injury. Thereafter, he filed a complaint for damages against the Hamms for negligence in maintaining the ramp. Peters' wife joined in the complaint on a loss of consortium claim. The complaint was later amended to include Forster as a party defendant.
1
Thereafter Forster moved for summary judgment which the trial court granted on grounds that as a matter of law Forster owed no duty to Peters because the Hamms "accepted and paid for" the work Forster performed. Appellants' App. at 1. On review, the Court of Appeals reversed relying on an exception to the general rule of nonliability where an owner accepts a contractor's work. Peters v. Forster,
Discussion
In order to prevail on a claim of negligence, a plaintiff is required to prove: (1) a duty qwed by the defendant to the plaintiff; (2) a breach of that duty by the defendant; and (3) an injury to the plaintiff proximately caused by the breach. Benton v. City of Oakland City,
Generally, Indiana has followed the rule that "contractors do not owe a duty of care to third parties after the owner has accepted the work." Blake v. Calumet Constr. Corp.,
There is no privity of contract between these parties; and if the plaintiff can "sue, every passenger, or even any person passing along the road, who was injured by the upsetting of the coach, might bring a similar action. Unless weconfine the operation of such contracts as this to the parties who entered into them, the most absurd and outrageous consequences, to which I can see no limit, would ensue. ...
Id. at 405. Early American common law mirrored the English common law rule requiring privity of contract. Accordingly, although a contractor was held lable for injury that resulted from his negligence before his work was completed, "his responsibility was terminated, and he was not liable to any third person once the structure was completed and accepted by the owner." W. Page Keeton et al., Prosser & Keeton on the Law of Torts § 104A, at 722 (5th ed.1984).
The acceptance rule first appeared on Indiana's legal landscape with this Court's opinion in Daugherty v. Herzog,
There must be causal connection between the negligence and the hurt; and such causal connection is interrupted by the interposition, between the negligence and the hurt of any independent human agency.... Thus, a contractor is employed by a city to build a bridge in a workmanlike manner; and after he has finished his work, and it has been accepted by the city, a traveler is hurt when passing over it by a defect caused by the contractor's negligence. Now the contractor may be liable to the city for his negligence, but he is not liable in an action on the case for damages. The reason sometimes given to sustain such conclusion is, that otherwise there would be no end to suits. But a better ground is that there is, no causal connection, as we have seen, between the traveler's hurt and the contractor's negligence ... [Bletween the contractor and the traveler intervened the city, an independent responsible agent, breaking the causal connection.
Id. at 457-58 (quotations omitted). Relying on Daugherty and its progeny, our courts have articulated two primary reasons supporting the acceptance rule: (1) the application of the doctrine of privity to cases involving negligence;
2
and (2) the owner's control of the entity when the
The privity of contract requirement in the law of negligence has largely eroded. In a watershed decision Judge Cardozo, speaking for a majority on the New York court of last resort, ruled that a manufacturer of automobiles could be held liable in negligence to the ultimate purchaser of the vehicle, not just the immediate purchaser-the retail dealer. MacPherson v. Buick Motor Co.,
The declining role of privity in the area of manufacturer's liability, along with the growing list of exceptions to the privity requirement, has contributed to the increasing number of jurisdictions that have abandoned the acceptance rule. See, e.g., Strakos v. Gehring,
[The acceptance rule] has the undesirable effect of shifting responsibility for negligent acts or omissions from the negligent party to an innocent person who paid for the negligent party's services. Furthermore, the shifting of responsibility is based on the legal fiction that by accepting a contractor's work, the owner of the property fully appreciates the nature 'of any defect or dangerous condition and assumes responsibility for it. In reality, the opposite is usually true. Contractors, whether they be building contractors, or architects, are hired for their expertise and knowledge. The reason they are paid for their services is that the average property owner does not have sufficient knowledge or expertise to design or construct real property improvements safely and soundly.... How then can we logically conclude that simply because the professional has completed his or her services and the contractee has paid for those services, lability for the contractor's negligence should shift to the innocent and uninformed contractee? We cannot.
Pierce v. ALSC Architects, P.S.,
As Professor Prosser observes:
It is now the almost universal rule that the contractor is liable to all those who may foreseeably be injured by the structure, not only when he fails to disclose dangerous conditions known to him, but also when the work is negligently done. This applies not only to contractors doing original work, but also to those who make repairs, or install parts, as well as supervising architects and engineers. There may be liability for negligent design, as well as for negligent construction.
Keeton et al., supra, § 104A, at 723. This trend also is reflected in the Restatement (Second) of Torts:
One who on behalf of the possessor of land erects a structure or creates any other condition thereon is subject to liability to others upon or outside of the land for physical harm caused to them by the dangerous character of the structure or condition after his work has been accepted by the possessor, under the same rules as those determining the liability of one who as manufacturer or independent contractor makes a chattel for the use of others.
Restatement (Second) of Torts §. 385 (1965).
In essence instead of applying the non-liability rule, a number of courts have embraced the rule that a contractor is lable for injuries or death of third persons after acceptance by the owner where the work is reasonably certain to endanger third parties if negligently completed. See id. This view adopts the rationale that there are insufficient grounds to differentiate between liability of a manufacturer of goods and that of a building contractor. See id. We think this is the better view and today we endorse it as well. A rule that provides that a builder or contractor is liable for injury or damage to a third person as a result of the condition of the work, even after completion of the work and acceptance by the owner, where it was reasonably foreseeable that a third party would be injured by such work due to the contractor's negligence, is consistent with traditional principles of negligence upon which Indiana's scheme of negligence law is based.
We hasten to add that a contractor's liability under this reasoning is not absolute, but predicated upon negligence, that is, duty, breach of duty, and injury proximately caused by the breach. Thus for example, there is no breach of duty and consequently no negligence where a contractor merely follows the plans or specifications given him by the owner so long as they are not so obviously dangerous or defective that no reasonable contractor would follow them. Keeton et al., supra, § 104A, at 723-24; see also Ross v. State,
In this case Peters alleged among other things that Forster installed the ramp in violation of applicable building codes. The trial court granted summary
In general a contractor has a duty to use reasonable care both in his or her work and in the course of performance of the work. See Computer Co.,
We view Forster's claim as an argument that Peters' injury was not the proximate cause of Peters' alleged conduct. Although a rigorous definition is elusive," proximate cause has been defined as "that cause which, in natural and continuous sequence, unbroken by any efficient intervening cause, produces the result complained of and without which the result would not have occurred." Orville Milk Co. v. Beller,
Conclusion
The trial court entered summary judgment in favor of Forster on grounds he owed no duty to Peters based on the acceptance rule. Today we abandon the rule in favor of traditional principles of negli-genee. As such we conclude Forster owed Peters a duty of reasonable care. Because in this case neither breach of duty nor proximate cause can be determined as a matter of law, summary disposition is inappropriate. We therefore reverse the judg"ment of the trial court.
Notes
. Subsequently Peters and the Hamms entered an agreed settlement. As a result the Hamims are not parties to this appeal.
. See, e.g., Citizens Gas & Coke Util. v. Am. Econ. Ins. Co.,
. See, e.g., Blake,
. See, e.g., Menendez v. Paddock Pool Constr.,
. Although Indiana has had occasion to address only two exceptions to the rule, other exceptions include: (1) the contractor creates a situation which he or she knows or should know is inherently dangerous, (2) the contractor's conduct may be regarded as an implied invitation to third persons to come in contact with defective work, and (3) the finished work constitutes a nuisance per se. See 41 Am. Jur.2d Independent Contractors § 74 (1995) (compiling cases from other jurisdictions).
. See McFadden v. Ten-T Corp.,