The opinion of the court was delivered by: WEBER
This is a diversity Wrongful Death and Survival action for the death of an employee at the Jones & Laughlin Steel Corporation which occurred in an accident in its steel mill at the location of and during the operation of a large piece of equipment manufactured and sold to Jones & Laughlin Steel Corporation by Defendant Mesta Machine Company. Plaintiff's cause of action against Defendant Mesta is based on negligence of design and construction, and strict liability for a defective condition under the principle of Sec. 402A of the Restatement of Torts, 2nd.
Defendant Mesta Machine Company raises the bar of the 12 year statute of limitations created by the Pennsylvania Act of December 22, 1965, P.L. 1183, 12 P.S. § 65.1, which provides:
"No action * * * whether in contract, in tort or otherwise to recover damages:
(1) For any deficiency in the design, planning, supervision or observation of construction or construction of an improvement to real property,
(3) For injury to the person or for wrongful death arising out of any such deficiency, or
(4) For contribution or indemnity for damages sustained on account of any injury * * * shall be brought against any person lawfully performing or furnishing the design, planning, supervision of observation of construction, or construction of such improvement more than twelve years after completion of such an improvement."
We have no interpretation by the Pennsylvania courts as to the applicability of this statute in these circumstances. Very recently the Supreme Court of Pennsylvania in Misitis v. Steel City Piping Co., 441 Pa. 339, 272 A. 2d 883  held that the statute had no retroactive effect because there was no manifest intent of the legislature to give it such effect. Furthermore, the court held that the statute did not effect a procedural change but a substantive change and, therefore, could not affect the cause of action of a plaintiff who was injured before its effective date. The Pennsylvania Supreme Court found it unnecessary to pass upon the finding of the trial court that the Act was unconstitutional as special legislation.
We are then squarely faced with the question of whether this machine is "an improvement to real property" within the terms of the Act.
Defendant argues that if such machinery is so large that it cannot be removed without substantial damage to the real estate, it becomes a "fixture" and thus part of the improvements to real property under the doctrine of "fixtures". This doctrine, originally from the law of conveyancing, is an aid in determining whether such equipment and furnishings are part of the real estate which is transferred in ownership by a deed conveying the title to the real estate. The general rule is that when such equipment is so physically annexed to the land that it cannot be removed without material injury to the land or some structure thereon, it is deemed incorporated into the realty. While this is a principle so fundamental as not to require a supporting citation, it is nevertheless riddled with exceptions, and, like small fleas, the exceptions have smaller exceptions, and so on ad infinitum.
For the purpose of a mortgage placed on an industrial plant, a chattel, "Whether fast or loose", placed in an industrial plant for permanent use, and necessary to the operation of the plant, becomes a fixture and part of the real estate covered by the lien of the mortgage. Commonwealth Trust Co. of Pittsburgh v. Harkins, 312 Pa. 402, 167 A. 278 .
In further support of its allegation Mesta produces further cases under the Pennsylvania Eminent Domain Statute, 26 P.S. § 1-602, which require that in determining the fair market value of real property taken by eminent domain there shall be included "The machinery, equipment and fixtures forming a part of the real estate taken." 26 P.S. § ...