Appeal from the Judgment of the Court of Common Pleas, Allegheny County, Civil Division, at No. GD 80-11124.
Thomas L. Cooper, Pittsburgh, for appellant.
Louis C. Long, Pittsburgh, for appellees.
Brosky, Rowley and Feeney,*fn* JJ. Rowley, J., concurs in the result.
[ 350 Pa. Super. Page 418]
This appeal is from summary judgment in favor of appellee, Maremont Corporation, defendant in a defective design products liability suit.
[ 350 Pa. Super. Page 419]
The issue before us is the applicability under Pennsylvania law of the government contract defense to a strict products liability action.
The government contract defense has long been recognized in Pennsylvania tort law, but our appellate courts have not previously considered whether the defense also applies in products liability cases. We hold that the government contract defense is available in a strict products liability action under certain narrowly-defined circumstances.
Stipulations of the parties show that the nature of appellee's government contract justifies the protection of the government contract defense. Accordingly, summary judgment is affirmed.
Facts and Procedural History
Appellee manufactures M60 machine guns under contract to the United States government. The M60 machine gun was designed by the United States government, and the design is and has always been the property of the United States. The parties have stipulated that appellee must (and does) manufacture the M60 to design and performance requirements established by the U.S. Army, and appellee has no leeway in changing any aspect of the design. All M60 machine guns produced by appellee are produced only for the government; appellee has no control over further distribution of the weapon and none are sold by appellee in the general stream of commerce.
Plaintiff (appellant herein), a Captain Edward Mackey in the Pennsylvania National Guard, was injured while attempting to disassemble an M60 manufactured by appellee. Captain Mackey alleges that his injury was caused by a design defect in the M60 machine gun he used during a training session conducted by the National Guard. He alleges that the M60 was manufactured by appellee and that therefore the manufacturer should be held strictly liable under Section 402A, Restatement of Torts (Second), as a supplier of a product which was defectively designed.
[ 350 Pa. Super. Page 420]
He does not allege that the particular M60 he used was defectively manufactured or that the M60 did not conform to Army specifications. Thus, for purposes of this appeal, we must assume that Captain Mackey's injury was caused by a design defect in an M60 machine gun manufactured by appellee in conformance with U.S. Army specifications.
Appellant additionally alleges that appellee is liable for failure to warn M60 users of the danger that the guide rod could discharge during assembly, causing precisely such an injury as occurred to him. Failure to warn the ultimate users of a product's hazards is a separate cause of action in Pennsylvania strict products liability law. Berkebile v. Brantly Helicopter Corp., 462 Pa. 83, 337 A.2d 893 (1975); Incollingo v. Ewing, et al., 444 Pa. 263, 287, 282 A.2d 206, 219 (1971); Hammond v. International Harvester, 691 F.2d 646 (3d.Cir.1982) (applying Pennsylvania law). However, the parties in this case have stipulated that all operating procedures of the M60 machine gun, including assembly and disassembly, have been established by the United States government. Thus, the government contract defense may be equally applicable to the claim of failure to warn as it is the claim of defective design.
The Government Contract Defense in Pennsylvania Law
Pennsylvania recognizes an affirmative defense to actions for damages caused by a private contractor's performance of a government contract "where a contractor performs his work in accordance with the plans and specifications and is guilty of neither a negligent or willful tort." Ference v. Booth & Flinn Co., 370 Pa. 400, 403, 88 A.2d 413, 414 (1952). Our Supreme Court explained two policy justifications for the government contract defense in upholding the Ference rule four years later. Valley Forge Gardens, Inc. v. James D. Morrisey, Inc., 385 Pa. 477, 123 A.2d 888 (1956). First, the contractor should be shielded from liability when undertaking work for which the government itself would be privileged by sovereign immunity, so
[ 350 Pa. Super. Page 421]
long as the contractor does not commit a negligent or willful tort in its performance. This shield primarily serves to protect the government, for, if the contractor were not immune when it carefully complied, costs of possible damages from the engineering or planning decisions of the government itself would be spread back to the government, defeating the government's sovereign immunity. Second, the assurance of protection from suit for the damages consequential to the government's intended plan encourages lower costs to the government on competitive bids.
Both Ference and Valley Gardens involved claims in nuisance or trespass for property damage resulting from road contract work performance by private contractors to government specification. Ference treated a public nuisance claim by a bus company which suffered a loss of revenue when highway construction closed a nearby road which was essential to the bus line. In Valley Forge Gardens, run-off erosion from the highway construction embankment silted up the plaintiff's ponds. Neither case was premised on a theory of negligence in performing the government contract. The damages resulted from the engineering decisions made by the government, not from the manner of the execution of the contract. Thus, the government contract defense served to protect the contractor from traditional tort liability for damages caused by the government's engineering decisions.
However, our Commonwealth's Supreme Court has refused to apply the government contract defense when the plaintiff's damages are caused by the abnormally dangerous activities of the defendant contractor, such as by blasting. Lobozzo v. Eidemiller, Inc., 437 Pa. 360, 263 A.2d 432 (1970). The Court refused to extend the protection from suit which would have been available to the government had it performed the blasting itself because of the inherent nature of the cause of action. "If blasting, even though carefully performed, causes damage, it by that fact becomes 'tortious' and actionable, and one whose property is injured may have recovery." Lobozzo, 437 Pa. at 365, 263
[ 350 Pa. Super. Page 422]
A.2d at 435. Liability for damages to others must be expected occasionally by all who choose to engage in abnormally dangerous activities. It is an absolute liability tort, for which liability without fault is imposed. Id.
The reasons for the Court's refusal to extend the defense to claims arising from abnormally dangerous activities mirror the reasons for the recognition of absolute liability for abnormally dangerous activities. Blasting occasionally results in unpredictable and uncontrollable damage regardless of the care exercised. Hence, one who chooses to employ unusual " abnormally " dangerous activities is expected to bear the resulting costs, and the government planning such work expects that blasting victims will be compensated by the contractor.
In contrast, damages from trespass (Valley Forge Gardens) and nuisance (Ference) are more controllable through careful, non-negligent performance. Such damages are an unfortunate result of the government's discretionary decision to undertake the contracted work; and, when the contractor is blameless, the consequences must be borne, uncompensated, by the innocent victim.
That the state itself may have proceeded wrongfully in not foreseeing the consequential damage to plaintiff's property and making provision for its compensation supports not at all the conclusion that either the highway commissioner or the defendant [contractor] has committed wrong in proceeding with the work in the only way it could be done. Having committed no wrong, defendant should not be subjected to liability. It is not saved by the state's immunity from suit, but by its own innocence of wrongful acts resulting in liability for tort.
Valley Forge Gardens, 385 Pa. at 890-891, 123 A.2d at 891 ...