Kent Village Associates Joint Venture v. Smith

WILNER, Chief Judge. This appeal arises from a tragic accident that occurred on October 27, 1988. Four-year-old Kimberly Smith was playing on a refuse bin located near the playground in the apartment development where she lived when the bin fell over on her, causing very serious and permanent injuries and leaving her a paraplegic. In April, 1991, the State of Illinois, Kimberly’s guardian, filed suit in the Circuit Court for Prince George’s County against Kent Village Associates Joint Venture (Kent Village), the owner of the apartment development; Southern Management Corp. (Southern), an allied company, which acted as management agent for Kent Village; and Consolidated Waste Industries, Inc. (Consolidated), which provided waste removal services for Kent Village and which owned the refuse bin.

Two causes of action were submitted to a jury—negligence and violation of Federal Consumer Product Safety Act ( 15 U.S.C. § 2051 et seq.). The jury (1) found against all three defendants on both counts, (2) assessed damages against each in the amount of $14,640,000, and (3) determined that Kent Village and Southern were not entitled to indemnification from Consolidated. Upon motion of the defendants, the court applied the provisions of Md.Code Cts. & Jud.Proc. art., § 11-108 and reduced the $2,300,000 component of the verdict awarded for non-economic damages to $350,000, thus reducing the aggregate verdict to $12,690,002. ⁵¹² Kent Village and Southern have appealed the judgments entered against them and the subsequent refusal of the court to “annuitize” the judgment in accordance with Md.Code Cts. & Jud.Proe. art., § 11-109. Kimberly has cross-appealed the $1,950,000 reduction in the jury’s verdict.

Consolidated has not appealed. Five issues are presented by Kent Village and Southern: (1) Whether there was legally sufficient evidence that they knowingly violated the Consumer Product Safety Act, and that any such violation was the proximate cause of the accident; (2) Whether the court erred in allowing into evidence and the jury to consider certain standards promulgated by the American National Standards Institute (ANSI); (3) Whether the court erred in allowing a life care planner, Estelle Davis, to render opinions concerning Kimberly’s future medical condition and treatment; (4) Whether the court misinterpreted Md.Code Cts. & Jud.Proc. art., § 11-109 in refusing to approve appellants’ proposed “annuitization” of Kimberly’s future medical expenses; and (5) Whether the court erred.in entering judgment for Consolidated on appellants’ cross-claim for contribution. In her cross-appeal, Kimberly raises the single issue of whether Federal preemption precludes the application of Maryland’s statutory $350,000 “cap” on non-economic damages to an award based on a violation of the Consumer Product Safety Act. We shall deal with these issues in the order presented.

CONSUMER PRODUCT SAFETY ACT The Consumer Product Safety Act is found in 15 U.S.C. §§ 2051-2083 . One of its purposes, enunciated by Congress in § 2051(b), is to protect the public against unreasonable risks of injury associated with consumer products. A “consumer product” is defined in § 2052(a) as including a product produced or distributed for sale to a consumer for use in or ⁵¹³ around a residence. Appellants do not dispute that the refuse bin that crushed Kimberly Smith was a consumer product.

The Act creates the Consumer Product Safety Commission and authorizes it, among other things, to promulgate consumer product safety standards and rules declaring a product that is distributed in commerce and presents an unreasonable risk of injury to be a “banned hazardous product.” §§ 2056, 2057. On June 13, 1978, the Commission adopted a rule declaring as banned hazardous products certain refuse bins of metal construction, having an actual internal volume of one cubic yard or greater, which tip over when subjected to a horizontal force of 70 pounds or a vertical downward force of 191 pounds. 16 C.F.R. Part 1301. Section 2068(a)(2) of title 15 makes it unlawful for any person to distribute in commerce a banned hazardous product. Sections 2069, 2070, and 2071 provide civil and criminal penalties for the violation of § 2068 and for injunctive relief.

Section 2072(a) provides, additionally, in relevant part: “Any person who shall sustain injury by reason of any knowing (including willful) violation of a consumer product safety rule, or any other rule or order issued by the Commission may sue any person who knowingly (including willfully) violated any such rule or order in any district court of the United States in the district in which the defendant resides or is found ..., shall recover damages sustained, and may, if the court determines it to be in the interest of justice, recover the costs of suit, including reasonable attorneys’ fees ... and reasonable expert witness’ fees----” The basis of Kimberly’s claim under the Consumer Product Safety Act was the contention that (1) until February, 1986, Kent Village and Southern performed the waste removal services for the Kent Village complex, (2) Kent Village then owned the bin that fell over on her, (3) in February, 1986, the bin was a banned hazardous product, (4) in that month, Kent Village or Southern contracted with Consolidated to perform the waste removal services for the apartment complex and, as part of that contract, sold Consolidated the bins Kent Vil ⁵¹⁴ lage/Southern were then using, including the bin that injured Kimberly, and (5) through that sale, Kent Village/Southern distributed a banned hazardous product in commerce. Kent Village and Southern offer a two-part defense to this claim: first, that State courts have no jurisdiction over claims made under the Consumer Product Safety Act; and second, that the evidence was insufficient to show that the bin that fell on Kimberly was a banned hazardous product. We find no merit in either assertion. Jurisdiction As noted, § 2072(a) allows a person injured by reason of any knowing violation of a rule or order of the Commission to sue the violator “in any district court of the United States in the district in which the defendant is found.... ” Appellants treat this statute as conferring exclusive jurisdiction on the Federal courts and thus precluding such suits in State courts.

The principles governing this issue were well and succinctly stated in Gulf Offshore Co. v. Mobil Oil Corp., 453 U.S. 473 , 101 S.Ct. 2870 , 69 L.Ed.2d 784 (1981), where the Court found concurrent State jurisdiction over actions under the Outer Continental Shelf Lands Act. There, as here, the Federal District Courts were given express jurisdiction over claims arising under the Act, but the Court, at 479, 101 S.Ct. at 2875 , made clear that “the mere grant of jurisdiction to a federal court does not operate to oust a state court from concurrent jurisdiction over the cause of action.” Earlier in the Opinion, the Court declared: “The general principle of state-court jurisdiction over cases arising under federal laws is straightforward; state courts may assume subject-matter jurisdiction over a federal cause of action absent provision by Congress to the contrary or disabling incompatibility between the federal claim and state-court adjudication____ In considering the propriety of state-court jurisdiction over any particular federal claim, the Court begins with the presumption that state courts énjoy concurrent jurisdic ⁵¹⁵ tion.... Congress, however, may confíne jurisdiction to the federal courts either explicitly or implicitly. Thus, the presumption of concurrent jurisdiction can be rebutted by an explicit statutory directive, by unmistakable implication from legislative history, or by a clear incompatibility between state-court jurisdiction and federal interests.” Id. at 477-78 , 101 S.Ct. at 2875 (citations omitted); see also Tafflin v. Levitt, 493 U.S. 455, 458-60 , 110 S.Ct. 792, 794-95 , 107 L.Ed.2d 887 (1990), recognizing concurrent State court jurisdiction over civil RICO claims.

Applying these principles, the Supreme Court of Minnesota, after reviewing the legislative history of the Consumer Product Safety Act, held that the State courts had concurrent jurisdiction over claims under § 2072. Swenson v. Emerson Elec. Co., 374 N.W.2d 690 (Minn.1985), cert. denied, 476 U.S. 1130 , 106 S.Ct. 1998 , 90 L.Ed.2d 678 (1986). At 697, the Court reasoned: “Section 2072 contains no explicit grant of exclusive jurisdiction to the federal courts.

Our review of the legislative history of the CPSA does not reveal any consideration of the jurisdictional question.... Finally, it is unlikely that Congress intended federal courts to have exclusive jurisdiction over private actions under the CPSA because most actions in which CPSA claims are asserted would also include claims of state common law violations such as negligence, breach of warranty, and strict product liability. Any intent by Congress to require all of these actions to be brought in federal courts would have to be explicit.” (Citations omitted.) The New York courts have reached a similar conclusion. See Howard v. Poseidon Pools, Inc., 133 Misc.2d 43 , 506 N.Y.S.2d 519 (1986), aff'd in part, rev’d in part on other grounds, 134 A.D.2d 926 , 522 N.Y.S.2d 388 (1987).

We are unaware of any decisions to the contrary; none have been cited by appellants. Having examined the pertinent legislative history of the Act ourselves, we agree with the analysis of the Minnesota ⁵¹⁶ Court and thus conclude that actions under § 2072 may be brought in the Maryland State courts. Evidence Concerning The Bin Appellants make three arguments with respect to the evidence adduced in support of the claim under § 2072: first, that there was no evidence that the bin was a banned hazardous product when sold to Consolidated in 1986; second, that the evidence failed to establish that the bin tested by Kenneth Thompson, a Consumer Product Safety Commission investigator who testified on Kimberly’s behalf, was the one that fell on her; and third, that, even if the bin tested was the one in question, it had been materially altered after the accident and before the test. Kimberly responds that (1) these attacks have not been preserved for appellate review because they were not properly presented to the trial court, and (2) the evidence was sufficient in any event.

We agree with both responses. At the conclusion of the plaintiffs case, appellants moved for a “directed verdict.” Their only argument, other than with respect to the issue of indemnity by Consolidated, was as follows: “Right. And so far as the evidence in the case, we do not believe that there is evidence to support plaintiffs contention that the—that this matter is going to go forward against this defendant based on the Consumer Product Safety Commission regulations and the ANSI standards, which are not binding, but only recommendations.” That motion was denied, and appellants put on a defense, thereby effectively withdrawing the motion. Md.Rule 2-519(c).

At the end of the entire case, appellants renewed their motion, adopting the argument made earlier and adding the legal argument that the Consumer Product Safety Commission regulation did not apply to them. Rule 2-519(a) requires that, in making a motion for judgment, the moving party “shall state with particularity all ⁵¹⁷ reasons why the motion should be granted.” This is the same requirement that appears in the analogous criminal rule, Md.Rule 4-324(a), and it means what it says. Failure to state a reason “with particularity” serves to withdraw the issue from appellate review. State v. Lyles, 308 Md. 129 , 517 A.2d 761 (1986); Muir v. State, 308 Md. 208 , 517 A.2d 1105 (1986).

This requirement has important and salutary purposes. It implements, on the one hand, a principle of basic fairness. A trial judge must be given a reasonable opportunity to consider all legal and evidentiary arguments in deciding what issues to submit to the jury and in framing proper instructions to the jury. The other parties must have a fair opportunity at the trial level to respond to legal and evidentiary challenges in order (1) to make their own record on those issues and (2) to devise alternative trial strategies and arguments should the court grant the motion, in whole or in part.

Allowing these issues to be presented for the first time on appeal is also jurisprudentially unsound, for it may well result in requiring a full new trial that otherwise might have been avoided. We do not believe that the brief, non-specific argument made by appellants in support of their motions sufficed to present “with particularity” the arguments presented on appeal. A statement that there was insufficient evidence to allow “this matter ... to go forward against this defendant based on the Consumer Product Safety Commission regulations” does nothing to alert the court to a complaint that the evidence failed to establish the condition of the bin in 1986, that the bin tested was the one that fell on Kimberly, or that the bin had been materially altered after the accident. At least in a case of this magnitude, with all of the varied issues presented in a trial that extended over a 25-day period, far more specificity is required.

We therefore conclude that the tripartite attack on the evidence underlying the Federal claim now sought to be made by appellants is not preserved for appellate review. Had we reached those issues, we would have rejected appellant’s complaints on the merits. There was testimony ⁵¹⁸ from Wilton Lash, Consolidated’s president, indicating that the bin that had been identified as the one falling on Kimberly was among those purchased by Consolidated from Kent Village in 1986 and that it was in the same condition then as it appeared in a photograph taken after the accident. An expert witness, Dr. Dickinson, testified that, if the bin was one of those sold to Consolidated without modification or retro-fitting, the sale would have violated the Act.

There was, to be sure, some conflict in the evidence regarding just what bin Mr. Thompson tested, but evidence was presented sufficient to show that the bin he tested—the one that failed the test—was indeed the bin that fell on Kimberly. In deposition testimony read to the jury, Mr. Thompson said that he reported to the scene of the accident on October 28— the day following the accident. Several children at the scene identified the bin that fell over on Kimberly. Because that bin was then full of trash, he was unable to test it that day, but he did take a number of photographs of it.

Six days later, he went to Consolidated’s place of business where Mr. Lash told him that Consolidated had brought the bin back to its yard. In response to Thompson’s request, Lash identified the bin that had been involved in the accident, and Thompson proceeded to test it. The bin failed the test; it tipped at 146 pounds of vertical force, the standard, as noted above, being 191 pounds. Thompson compared three sets of photographs—one set taken by the police on the evening after the accident, one set taken when Thompson first inspected the bin on October 28, and a third set taken at Consolidated’s yard on November 3 when Thompson actually tested the bin.

He stated that one of the photographs taken by the police and a photograph taken by him on October 28 matched and that the photographs taken on October 28 and November 3 matched. He was “absolutely convinced” the photographs were of the same bin. The photographs themselves were admitted into evidence, so the jury could make its own comparison. All of this sufficed to permit the jury to find that the bin Thompson tested on November 3 and found deficient was the same bin that fell on Kimberly. ⁵¹⁹ Part of appellant’s argument that the bin tested on November 3 was not the one involved in the accident is based on evidence that the bin inspected on November 3 had a new wheel welded on to it.

We have disposed of the issue regarding the identity of the bin, but this evidence is also used by appellants to support their claim that the bin had been materially altered since they sold it to Consolidated, thereby undermining the assertion that the bin was a banned hazardous product when sold in 1986 and when it tipped over on to Kimberly. Kimberly makes a two-fold response. First, she points out that, even if the wheel had been replaced after the accident but prior to the testing, the likely effect of the new wheel would be to make the bin more, not less, sturdy, and, as it failed the test even with the new wheel, it must have been in at least as bad condition before the wheel was replaced. More important, she points to the testimony of Dr. Dickinson, her engineering expert, that, because he was unable to determine whether the wheel was broken and replaced prior to or after the accident, he did not take the condition of the wheel into consideration in his conclusion that the bin was unsafe.

Although Dr. Dickinson’s testimony went more to the negligence count than to the claim under the Consumer Product Safety Act, it supported the inference urged by Kimberly that, if anything, the replacement wheel made the bin more, not less, sturdy, and therefore did not necessarily negate the other evidence that the bin was a banned hazardous product when sold to Consolidated and that it continued to be such a product at the time of the accident. ANSI STANDARD The American National Standards Institute (ANSI) is a national safety organization, founded in 1918, consisting of industrial firms, trade associations, technical societies, labor and consumer organizations, and government agencies. According to the Encyclopedia of Associations 691 (29th ed. 1994), it serves, among other things “as [a] clearinghouse for ⁵²⁰ nationally coordinated voluntary standards for fields ranging from information technology to building construction.” In 1977, ANSI adopted a standard for the stability of refuse bins (Standard Z245.3). Groups such as the National Safety Council, the Environmental Protection Agency, the American Society of Mechanical Engineers, the American Public Works Association, the Waste Equipment Manufacturers’ Institute, the National Solid Wastes Management Association, municipal goyernments, labor organizations, and companies and organizations from the insurance and waste disposal industries participated in the development of the standard.

The Consumer Product Safety Commission regulation adopted a year later incorporated a number of the performance requirements stated in Standard Z245.3, but to the extent that the ANSI standard was not incorporated into the Commission’s rule, it remains a voluntary standard. James Greco, who chaired the subcommittee that developed the ANSI standard, testified about the standard. Among other things, he noted that the standard placed certain responsibilities on manufacturers, owners, collectors, and customers. One of the responsibilities of a “customer,” defined in the standard as “a person who has arranged or contracted for refuse collection service,” is to “ensure that refuse bins used and placed on the customer’s premises conform to the applicable requirements of this standard.” Greco testified that Kent Village was a customer, except for the period when it owned the bin, during which time it would have been an “owner.” An “owner” was responsible for ensuring that only refuse bins meeting the performance and safety marking requirements of the standard are used.

Appellants urge that admission of this evidence was inappropriate because (1) the standard applies only to the waste management industry and not to apartment owners, (2) it was never “adopted” by the State of Maryland or Prince George’s County, and therefore a violation could not serve as evidence of negligence, and (3) in certain of the hypothetical questions ⁵²¹ put to Dr. Dickinson, he was asked to assume facts as to which the evidence was in conflict. As with the first set of complaints, Kimberly rejoins that these objections were not raised below and have therefore not been preserved and that, in any case, they are without merit. We need not address the preservation question because, whether or not the objections were preserved, they are without merit. There is nothing in the record to support appellants’ contention that the ANSI Standard does not apply to customers such as apartment owners.

As noted, the Standard itself places certain responsibilities on customers, and, as defined in the Standard, an apartment owner who contracts for refuse collection service, as Kent Village did, is a customer. Mr. Greco confirmed that in his testimony. Nor does the fact that the Standard has not been officially adopted as a regulation by the State or the county destroy its relevance as articulating a standard of care, the violation of which may be regarded as evidence of negligence. Although there is some division of authority on the matter, increasingly, upon the establishment of a sufficient foundation, courts have permitted the introduction of voluntary safety codes and standards, such as those promulgated by ANSI, as evidence of applicable standards and have regarded the violation of such standards, where relevant to the factual circumstances of the case, as evidence of negligence.

In Hansen v. Abrasive Engineering and Mfg., 317 Or. 378 , 856 P.2d 625, 628 (1993), the Oregon Court noted: “Because advisory safety standards that are adopted by nongovernmental entities such as ANSI may represent a consensus regarding what a reasonable person in a particular industry would do, they may be helpful to the trier of fact in deciding whether the defendant has met the standard of care due. The ANSI advisory standards provide some evidence of the custom in defendant’s industry and, therefore, are rele ⁵²² vant to the jury’s consideration of whether defendant met the standard of care.” (Citations omitted); see also Wallner v. Kitchens of Sara Lee, Inc., 419 F.2d 1028 (7th Cir.1969); Bailey v. V & O