Yukon Equipment, Inc. v. Fireman's Fund Insurance Co.

EQUIPMENT, INC., YUKON an Alaska

Corporation, and E. I. du Pont de Nem Company, Corporation,

ours a Delaware

Petitioners,

FIREMAN’S FUND INSURANCE al., Respondents.

COMPANY et 3308.

No.

Supreme Court Alaska.

Nov. Sedwick, explosives day the site a or two Pease, Jr., stolen M. J. W. Theodore Inc., Kurtz, for Burr, Anchorage, Pease & earlier.

petitioners. brought to lawsuit was This consolidated Smith, Sutliff, Hagans,

Richard N. the damage by for caused property recover Brown, Gibbs, Lynch, M. Timothy Erwin & for sum- explosion. partial Cross-motions Abbott, Farney LeRoy & De- Lynch, Rodey, filed, summary mary judgment were and Yeaux, DeVeaux, Joseph M. Wanamaker & was liability on the issue of judgment Huddleston, Gantz, Thorsness, Hughes, Re- respondents. in favor of the granted Brundin, Opland, Powell & and Robert N. presented alternative theories spondents Johnston, Opland Anchorage, respon- & nuisance, ab- liability negligence, based on dents. liability, The court’s trespass. solute and judgment granting partial summary

order liability on specify theory did not the which OPINION based. was BOOCHEVER, J., RABI- Before C. and none of the theo- Petitioners contend WITZ, CONNOR, BURKE and MAT- NO fix on them may ries be utilized to THEWS, JJ. the by summary and further that judgment magazine of the is a intentional detonation MATTHEWS, Justice. relieving superseding cause them of occurred at 2:47 a. m. large explosion A Respondents argue that any theory. under in the suburbs north on December summary under judgment sustainable city Anchorage. explosion The theory and that the originated storage magazine at a explosion is not a intentional nature of govern- sives under from the federal lease respondents We defense. I. petitioner ment to E. du Pont de Nem- affirm. by which Company, operated ours was The petitioner Equipment, Yukon Inc. I 1,870 storage magazine is located acre on stor- leading The for the case tract of which with- federal land had been Pow- age is Exner v. Sherman by the Interior Department drawn 1931). er F.2d 510 Const. for ex- for the of the Alaska Railroad dynamite stored the defendant There orders plosive storage purposes separate prop- exploded causing personal injury The which magazine in 1950 and 1961. resided plaintiffs who erty to 3,820 feet from the exploded was located site. feet from the away some to building nearest not used store Court distinguished of the Circuit panel A 4,330 high- public feet from nearest held the Circuit Appeals the Second it con- explosion At way. the time regardless liable fault: defendant 80,000 approximately of ex- pounds tained damaged dwellings and plosives. blast The class elements Dynamite is of a two mile radius of buildings other within or in such one who stores uses instances, and, be- magazine in some as to such circumstances locality, under ground a two radius. The yond others, mile stores or of risk to cause likelihood registered insurer, cussion it 1.8 on peril. caused is an uses at his He earthquake Richter observation scale at absolutely liable if results Palmer, away. some station 30 miles im- persons, from'-the direct third either explosion pact of out rocks thrown The was thieves. trespass) (which a common law would be the tract young Four men had driven onto or from concussion. located, magazine where the broken pointed 512-13. court out magazine, prepared Id. at The into lia apparently general principle did so while the charge, They and fled. English Ry case of in the bility expressed effort the fact that had conceal ness, justification we lands Fletcher1 had been accorded a think there no reception mixed at best in United States relieving liability, it of the own- courts, there had been no such reluctance to business, er of the than rather a third impose liability in blasting cases. party who relation then noted that some authorities sion, other injury, than that of should had made a damage distinction between bear loss. done explo rocks debris hurled widely Id. at 514. Exner has been fol- sion, as to which there would be absolute lowed,2 many and was based au- earlier liability, aby concus imposing thorities absolute ex- sion, as to which a negligence ap standard plosions.3 plied. The court concluded that such a reflects, As Exner rule of a logical distinction was without basis and blasting re- rejected it. Id. at 514. The court also general acceptance ceived earlier and more determined that there was no reason for generalized in the United than the States attaching legal consequences different rule of absolute dan- unusually the results an explosion “whether gerous activity has its antecedents in dynamite explodes when stored or when Rylands v. generalized Fletcher. The rule employed blasting.” expressed The court gained currency added in the United States policy behind the rule of absolute liabili following its adoption by the American Law ty as follows: Institute as sections 519—524 the Restate- The extent to which one man in the law- (1938). ment of Torts Under Restate- ful conduct his business is liable for 519, ment rule injuries to adjust- another involves an “ultra-hazardous” imposed. ment of conflicting interests. 520 Section defined an as ultra-haz- When, defendant, here, though ardous if it fault, without engaged perilous large (a) of storing quantities of a a risk necessarily involves of serious dangerous explosive for use in his busi- harm the person, land or chattels of 774, Eng.Rsp. (1865), (1971). jurisdictions 1. H.C. 159 737 35 rev. A.L.R.3d 1177 Some Rylands, Fletcher v. 1 distinguish explosives, L.R. Ex. 265 the use between Fletcher, aff'd., Rylands v. L.R. 3 H.L. 330 storage, applying liability only their (1868). inappro- where site is found to be Flor, g., priately v. located. E. Liber 160 Colo. Co., Pittsburgh-Des 2. Moran v. Moines Steel 7, Burgess, (1966); v. Otero 415 P.2d 332 84 1948); Britton v. Harrison F.2d 166 908 Cir. 575, (1973). N.M. 505 P.2d 1251 Co., F.Supp. Constr. (S.D.W.Va.1948); 87 405 Ready-Mix Co., Ga.App. Brooks v. Concrete 94 directly át 3.54 F.2d 513-14. Cases cited which 791, (1956); Opal v. Material 96 213 S.E.2d v„ support holding in Exner include: Colton Corp., 433, Serv. Ill.App.2d 9 133 N.E.2d 733 Onderdonk, 155, (1886); Schuchart, Mining (1956); 69 Cal. 10 P. 395 Coal Enos Co. v. 243 Co., Ry. 692, McKenna v. Elec. Cal.App. Pac. (1963); Ind. 104 Davis v. L. & 188 406 N.E.2d Co., 538, (1930); W. Constr. (Iowa 1970); P. Fitzsimmons & Connell 176 286 445 N.W.2d 223 Hise, Thigpen Braun, 290, 390, v. Skousen & Co. v. (1902); 64 N.M. 327 199 Ill. 65 N.E. 249 Realty (1958); Co., Guilford & Ins. P.2d 802 Mississippi Co. v. Watson v. River Power 174 Co., Blythe 69, Bros. 23, 260 N.C. 131 S.E.2d 900 (1916); French v. Cen- Iowa 156 N.W. 188 Goulter, (1963); 344, Bedell v. 199 Or. 261 P.2d Co., Mfg. 220, ter Creek Powder Mo.App. 173 Co., (1953); Wallace v. A. H. Guion & 842 237 Persell, Longtin (1913); v. 158 S.W. 723 30 349, (1960); City of Knox- S.C. 117 S.E.2d 359 306, City (1904); Louden v. Mont. 76 P. 699 Peebles, 340, ville v. Tenn.App. 19 87 S.W.2d Cincinnati, 144, 90 St. 106 Ohio N.E. 970 Co., (1935); Foster Preston v. Mill 1022 44 Glycerine Mary's (1914); Bradford v. St. Co. 440, (1954); Whitney 268 v. Wash.2d P.2d 645 Mfg. Co., 60 560, Woolen Ohio St: 54 N.E. 528 Ralph Meyers Contracting Corp., 146 W.Va. Bihler, (1899); Hickey v. McCabe & 346, 30 R.I. 130, (1961); v. 118 S.E.2d 622 Brown L. S. (1910); Feinberg Gran- v. Wisconsin 75 A. 404 Co., 122, Lunder Constr. 2 240 Wis. N.W.2d 859 Co., (1929); ite 54 S.D. 224 N.W. 184 Wythe Massey, (1942); see Koster & v. 293 Brewing Chicago, Ry. v. M. Schade Co., Co. & St. P. (9th 1961); 922 National Automobile F.2d (1914); Patrick Wash. 140 P. Casualty Company & Insurance v. Mt. Pitt Smith, Wash. P. generally, F.Supp. (D.Or.1964); see Annot., (1951, Supp. 1970); 20 A.L.R.2d 1372 it lists six to be sives. Instead others which cannot eliminated care, and determining exercise of the utmost an activ- considered in ity “abnormally dangerous” and there- usage. (b)is common not a matter of liability. subject fore to the rule of absolute make (e) to that section (c) and Comments The factors are: explosives per it clear that the (c) (a) degree of risk high states existence se ultra-hazardous.4 of a person, to the land or chattels part: some harm others; transportation are ultra-hazardous activ- sive substances re- (b) likelihood the harm that precautions and care can ities because great; it will be sults from reasonably certain that will make (c) inability the risk eliminate explode and because the harm result- care; of reasonable exercise from their is almost certain not a (d) extent to which the is to be serious. usage; matter of common (e) of question addresses the com- (e) of the inappropriateness usage, stating: mon on; the where and place it is carried recognized as a blasting proper While is (f) its to the extent to which value clearing of for means woodlands cultivat- danger- community outweighed by is its excavating building pur- of for ous attributes. require the its use poses, conditions which Id. 520. § gener- is of brief duration. It usually are

ally required peculiar because of the char- large part Based in on the Restatement part is not a of acter the land it (Second), argue their petitioners that farming processes of or of customary the dangerous. Specifical- abnormally was not Likewise, building the manu- operations. maga- use of the ly contend that their they facture, storage, transportation and use was a explosives zine the storage although necessary to high explosives, appropriate use of the area normal many public pri- the construction of was storage the magazine since works, aby compara- vate are carried on by on lands set aside the United situated and, persons number of tively small appar- and was purposes5 States for such therefore, are not matters of common ently applicable compliance located usage. point that regulations.6 They out federal Exner, Thus the rule of community storage legitimate the served a storage the caused need source of accessible the explosives, preserved by Restate- They purposes. contend various rule, from Ex- general ment and inferred imposed be liability can before absolute ner and on which was the authorities finding any preliminary circumstance based, Rylands v. Fletcher and the must made as whether or not be antecedents, imposed ab- was stated which danger- abnormally any activity which solute on other ous, involves such a determination of ultra-hazardous. met definition in sec- out weighing of six tion of the Restatement (Second) of Torts The Restatement fac- Torts, of those an evaluation (1977),adopted by the ALI after appropriately case not case, per se tors in this could in this does not reflect' sion summary judgment. motion for storage for the done on rule of 20, James, Land 689 of November Harper Public Order Law of 5. See 4.See 2 F. & F. Torts 8,119; 14.1, 1950, Fed.Reg. p. (1956) Public Land Order which states: “The Re- § 2,617. generalize attempted Fed.Reg. statement of Torts 2308 of March type fault in terms of one without In- what are called ‘ultrahazardous activities.’ 181.198 See C.F.R. manufacture, custody expressly cluded are ” . and use . . specified The factors only section 520 carried a comparatively small of the Restatement of Torts are persons number of and therefore are not court, for consideration of the not the jury.7 usage. matters of common assume, Here the petitioners must factor, inappropriateness The fifth present with the case in its posture, that the activity, arguably present, not for the superior court found that their activity was place did take designated on land abnormally dangerous. They contend that government the United States for that this court in reviewing superior court’s purpose. However, designation took assumed conclusion should apply place at a time when the area was less “clearly erroneous” standard of Civil Rule populated densely than it was at the time of 52(a) but is free to reach an independent explosion. Likewise, re- conclusion based on the same non-testimoni entirely serve was not appropriate to the al record of undisputed presented facts be - quantity stored because the low. We that this is the appropriate beyond well standard of review. National Bank of boundaries of the reserve. The sixth fac- K., (Alaska Alaska v. J.B.L. & 546 P.2d 579 tor, value to community primari- relates 1976); Juneau-Douglas Peters v. Girl Scout ly to situations where activi- Council, (Alaska 1974). P.2d ty primary economic activity of the apply If we were to community in question. (k) Thus comment (Second)’s six factor test to the states applies that such factor we would inclined explosives in this case be community is particularly when the the use involved here was to conclude that dangerous enter- largely devoted to an one. Comment abnormally prise prosperity largely depends (f) that to section 520 makes clear all of particu- upon it. Thus the interests of a present need not be for an the factors activ- depends upon lar whose livelihood town ity abnormally dangerous: to be considered manufacturing cement such an as In determining whether danger may plants be such that cement will be abnormal, (a) the factors listed in clauses regarded as a normal for that (f) of this are Section all to be con- community notwithstanding the risk of sidered, and importance. are all of Any serious harm the emission of cement from one of them is not necessarily sufficient dust. particular case, to itself in a and ordinari- The comment further states that ly several of required them will be Oklahoma, in Texas properly strict liability. On the other hand it is well, gas ducted oil or at least in a rural not necessary that each of them be area, regarded abnormally as dan- present, especially weigh- if heavi- others gerous, while a different conclusion has ly- been in Kansas and Indiana. reached factors, involving degree The first three California, industry whose oil is far from harm, risk, difficulty eliminating insignificant, has that an oil concluded risk, obviously present are in the stor- thickly well drilled in a settled residential age 80,000 pounds in a City area in the Angeles of Los is a factor, suburban area. The fourth that the matter liability. of strict usage, not be a matter of common (i) is also met. states: required by five of the six factors Since (Second) section 520 of the Restatement are manufacture, Likewise the storage, trans- debatable, met and the sixth is we would portation high explosives, and use of al- impose liability here if though necessary to the construction of absolute we were works, many public private are approach.8 that Kuhlman, (Second) Siegler 8. 81 Wash.2d Restatement of Torts Com- Cf. (1) (1977). P.2d 1181 ment cert. denied U.S. II However, we do not believe approach should question is whether The next involving the use or in cases be used storage maga detonation of the intentional Instead, we adhere to relieving peti cause superseding zine was a Sharp Power Constr. Co. v. Fair liability. of Exner v. In rule Sherman tioners Borough, 569 P.2d banks North Star imposing absolute progeny and its case, we stated (Alaska 1977), negligence The Restatement in eases.9 such where “af cause exists superseding that a degrees analysis approach requires from the looking back ter the event eliminating harm, difficulty of risk and conduct, it negligent actor’s harm to the place, before risk, appropriateness extraordinary highly appears to the imposed. Such liability may brought have about it should negligence standard.10 suggest 182, quoting from Re 569 P.2d at harm.” may well be neces analysis six factor (Second) of Torts § statement by unique damage is caused sary where Sharp, explained We further question hazards and the threat- the defendant’s conduct [w]here liability applies, but rule of absolute general will kind of result which ens a storage and use of involving the in cases intervening injure plaintiff and an have question we take anticipa- not have been cause which could century of more than a been resolved produces situation but changes ted decisions. judicial threatened, originally the same result liabili- imposing The reasons scope a result is within such risk grave created a those who have ty on negligence. using explo- by storing others of harm to 183 n. 9. The considerations Id. at is a considera- where there independent cutting largely impel sives are off also cases negligence superseding We see cause appropriateness. of locational tions liability.11 apply to cases of a distinction between making no reason when to recover right of a homesteader Prior to the illegally damaged by a blast had been magazines has been property petitioners’ his Most of times. state, at least six broken into off in a remote corner set explo- the theft of involved entries these an urban resi- compensation of right to of knowledge of all had sives. Petitioners explo- destroyed by an home is dent whose this. In each area. in a settled originating sion as a case, regarded to be properly the loss is forth in the standards Applying using storing or business of cost of the to find there facts we supra, to these Sharp, remains to Every incentive explosives. in The cause. superseding have been are as in locations which thieves premises by duct such activities cendiary destruction damages so uncom there of theft is not possible, safe as because evidence to cover regarded that it can kept will be to a occurrence accident mon an resulting from an Moreover, the extraordinary.12 highly as minimum. liability purpose is holding of strict (1973), cases. 36 L.Ed.2d 959 S.Ct. difficulty proof inherent in gasoline public highways overcome hauling to is abnor theories, law, utilizing thereby negligent warranty mally dangerous insur a matter of injuries physical are borne six factors identified in a tentative draft that the costs (Second). products.” Bu those who market defective Goods, Sporting fa ud v. Suburban Marine & cited, supra. 2 tolerated, supervening resolution the issue of cause by petitioners. Ill.App. was raised at 370. notes authorities 9. See Inc., 1975). (Alaska 543 P.2d analogous products 10. In the area of strict Prosser, rejected ap defective we of the Law of have W. Handbook 11. See proach 402(a) 1971). (4th of § of the Restatement Torts ed. § requires proof product of Torts which that a is Wilmington “unreasonably dangerous.” Chicago, represents & Vermillion See Coal “It Glass, step Ill.App. development products where the backwards in the Co. v. I am particular persuaded of result kind threatened that sections conduct, 520 of the Restatement sives, was an at site. (1977) embody Torts rule of law. sounder Since the threatened result occurred balance, I On think it that the preferable is would not principles be consistent with the court, making in whether the determination supra, in to Sharp, stated hold there have “abnormally dangerous” superseding been a cause. liabili- Absolute subject liability, em- therefore to absolute ty imposed on those who or use store ploy the criteria in section 520 articulated they have because created an analyze acts and circum- unusual risk others. As those between view, my of the case. In considera- stances who have created risk for the benefit of tion of these criteria offers a rational solu- enterprise only their own and those whose problem determining tion to the the enterprise connection with is to have particular activity .abnormally danger- it, suffered because of the law ous. places loss on the risk of the former. When I Despite foregoing, agree can with fact, the risk causes damage created in in- the court’s overall of this disposition appeal precise sistence that the details of inter- application since of section 520 to the facts vening cause be foreseeable subvert would of the case leads to the conclusion that the the purpose of that rule of law.13 abnormally danger- The partial summary judgment is AF- Thus ous.1 was properly FIRMED. imposed.2 RABINOWITZ, Justice, concurring. Although I concur in the result reached court, disagree adoption I with the approach of Exner v. Power Sherman 1931), Construction 54 F.2d 510 or imposes strict involving all cases the use or James, Harper stated with reference 13. See F. to stored & F. The Law of 14.5, p. sives: Torts It is no human because skill can tell when or respect, majority’s 1. In this I with the spark where the fatal the clouds analysis, arguendo made of the section 520 incendiary’s may light torch this criteria this factual context. everything mass and involve its reach within presence instant destruction that its In my agreement close 2. I also note with the court’s contact human habitation will not

Case Details

Case Name: Yukon Equipment, Inc. v. Fireman's Fund Insurance Co.

Court Name: Alaska Supreme Court

Date Published: Nov 3, 1978

Citation: 585 P.2d 1206

Docket Number: 3308

Court Abbreviation: Alaska