Plaintiff is a hemophiliac who alleges that he was infected with hepatitis and AIDS by a blood product called Koate. 1 Defendant Miles Laboratory, Inc. (Miles) manufactured the product, and defendant State of Oregon, through the Oregon Health Sciences Hemophilia Center, sold it to him. Plaintiffs complaint alleged that Miles was negligent and that both defendants are strictly hable. Both defendants moved to dismiss the strict liability claims for failure to state a claim. ORCP 21A(8). The trial court dismissed the claims with prejudice. The case proceeded to trial on the negligence theory, and Miles prevailed. The court then entered a judgment for both defendants. Plaintiff appeals the dismissal of his strict liability claims. We affirm.
The trial court dismissed the strict liability claims because of Oregon’s “blood shield” statute, ORS 97.300:
“(1) The procuring, processing, furnishing, distributing, achninistering or using of any part of a human body for the purpose of injecting, transfusing or transplanting that part into a human body is not a sales transaction covered by an implied warranty under the Uniform Commercial Code or otherwise.
“(2) As used in this section, ‘part’ means organs, tissues, eyes, bones, arteries, blood, other fluids and any other portions of a human body.” (Emphasis supplied.)
Plaintiff contends that the statute does not preclude a claim based on strict liability in tort. He reads the statute to mean that furnishing blood “is not a sales transaction covered by an implied warranty [(1)] under the Uniform Commercial Code [(UCC)] or [(2)] otherwise.” He argues that “otherwise” refers only to implied warranties outside the UCC.
Either interpretation is grammatically tenable. Because the statute is facially ambiguous, we examine its context and legislative history to ascertain the intent of the legislature. ORS 174.020;
Sager v. McClenden,
In 1969, when the statute was enacted, what liability there was for injuries caused by defective products was based on concepts relating to contractual warranties.
See, e.g., Stonebrink v. Highland Motors,
The Supreme Court created strict liability essentially by transmogrifying warranty law into tort law. It explained:
“It has heen pointed out, however, that ‘the obligation is imposed upon the seller, not because he has assumed it voluntarily, but because the law attaches such consequences to his conduct irrespective of any agreement; and in many cases, at least, to hold that a warranty “is a contract is to speak the language of pure fiction.” ’
“The word ‘warranty,’ with its connotation of contract has tended to obscure the fact that the liability imposed upon the seller for harm resulting from defective goods sold by him may rest entirely upon principles of tort law.” Wights v. Staff Jennings, supra,241 Or at 304 (quoting Prosser, Torts 651, § 95 (3d ed 1964) (quoting Williston, “Liability for Honest Misrepresentations,” 24 Harv L Rev 415, 420 (1911))).
When the Court adopted Section 402A of the
Restatement (Second) Torts
(1965) in
Heaton,
it noted that the definition was “conceptually related to the traditional warranty of merchantable quality in the law of sales.”
The parties agree that the legislature enacted ORS 97.300 in response to a Florida case that held that blood suppliers could be held liable without fault. 2 In Russell v. Community Blood Bank, Inc., 185 So 2d 749 (Fla App 1966), aff'd in part 196 So 2d 115 (Fla 1967), the plaintiff sued the blood bank after she had contracted hepatitis from a blood transfusion. She claimed a breach of implied warranties. The court recognized that courts in other states that had considered the issue had declared the furnishing of blood to be a service, not a sale. However, the court noted:
“It seems to us a distortion to take what is, at least arguably, a sale, twist it into the shape of a service, and then employthis transformed material in erecting the framework of a major policy decision.” 185 So 2d at 752.
The court held that a sale had occurred, thus making the blood bank susceptible to liability without fault.
At a hearing on the Oregon bill, the chairman of the Oregon Medical Association Blood Committee, Dr. Scott, described the Florida decision:
“ [T]he opinion stated the creation of an exemption to the ‘strict liability’ rule should be undertaken by the Legislature rather than the courts. That would seem to be the reason we are here this afternoon.” Minutes, House Public Health Committee, March 13,1969, p 3.
In the House floor debate, the proponent of the bill, Representative Graham, explained that the bill was written in response to the Florida decision and assured the House:
“This does not provide for immunity for physicians or blood banks or anyone else against negligence. It simply states that it is not [a] sale and therefore implying a warranty in the product.” House Floor Debate, March 18,1969, Tape 7, side 2.
Several witnesses testified that, if the bill were not passed, the prices of transfusions and transplants would skyrocket or they would no longer be available in the state. House Floor Debate, March 18, 1969, Tape 7, side 2. A witness before the Senate Judiciary Committee, Dr. Davis, testified:
“The purpose is significant — to ensure that the blood and tissues * * * should not be considered to be within the concept of a thing to be sold.” Senate Judiciary Committee, April 21, 1969, Tape 16, side 1.
The bill passed without any substantial controversy. 3 Significantly, none of the speakers differentiated between warranty liability and strict liability in tort. Any distinction made was between liability without fault and negligence, with several witnesses stressing that injured persons could still have a remedy for negligence. The legislative history makes plain that the legislature intended to preclude liability without fault, whatever its nature.
The context in which the statute was enacted helps explain why strict liability was not mentioned expressly when implied warranty was. At that time, the courts had just created strict liability, and it was seen as an offshoot of warranty law that did not need to be separately pleaded. Furthermore, the legislature enacted the statute in response to the Florida decision, which framed the issue in terms of whether a sale had occurred. The main focus of ORS 97.300 is on declaringthat the transactions do not constitute sales. Because strict liability cannot arise without there having been a sale, defendants could not be strictly liable.
Plaintiff argues that, if we hold that the statute precludes strict liability, we should limit that holding to nonprofit organizations, thus keeping defendant Miles potentially fiable. There is no basis in the statute for that distinction. The trial court correctly dismissed the strict liability claims against both defendants.
Affirmed.
Notes
Plaintiff died after he had filed a notice of appeal and submitted his opening brief but before the reply brief was filed. After oral argument, plaintiff's personal representative moved to have this court substitute her as appellant. ORAP 8.05(1); ORCP 34. She made the motion within a year of plaintiff’s death, and we granted it. For simplicity, we continue to refer to Kevin Royer as plaintiff.
Many other states also responded to the Florida case by enacting a blood shield statute; at least 48 states have one.
See Roberts v. Suburban Hospital,
73 Md App 1, 10 n 3,
One attorney wrote in opposition to the bill, suggesting that liability could be covered by insurance.