Owens-Illinois, Inc. v. Armstrong

CHASANOW, Judge. Kaylo is an asbestos-containing insulation that was manufactured and sold by petitioner, Owens-Illinois, Inc., from 1948 to 1958. In 1958, Owens-Illinois, Inc. conveyed the Kaylo product line to Owens-Corning Fiberglas. Kaylo was generally sold as 50-60 pound blocks which were separated into pieces with hammers or saws.

The cutting, ¹¹¹ fitting, and installation of Kaylo was alleged to have been extremely dusty work. Respondent, Othello Armstrong, worked first as a laborer and later as a welder on engines and in boiler rooms of various ships being built or repaired at the Bethlehem Steel Corporation shipyards. Armstrong was employed at the shipyards from 1942 to 1963. While there, Armstrong claims he was exposed to thick clouds of asbestos-containing dust which was identified by a witness as Kaylo dust.

There is no allegation that Armstrong was exposed to asbestos products after he left the shipyards in 1963. Respondent, Forrest Wood, was a rigger at a Bethlehem Steel shipyard from 1941 to 1975. As a rigger, Wood assisted other workmen in the removal of equipment and materials from ships. His job included assisting pipe-coverers in the installation and removal of pipe-covering insulation.

This work, like that performed by Armstrong, was alleged to have involved exposure to heavy clouds of Kaylo dust. Armstrong and Wood, along with two other workers not directly involved in this appeal, filed suit in the Circuit Court for Baltimore City against Owens-Illinois and other companies that manufactured, installed, or supplied asbestos-containing insulation products. The plaintiffs’ allegations were based on negligence and strict liability in tort. A jury returned verdicts for Armstrong and Wood against each defendant.

The trial court, Judge Clifton J. Gordy, Jr., denied the defendants’ motion for judgment notwithstanding the verdict. Owens-Illinois and Eagle-Picher Industries, two of the defendants, appealed. The latter’s appeal was stayed after it filed a Title 11 bankruptcy petition in the United States Bankruptcy Court for the Southern District of Ohio, thus making Owens-Illinois the sole defendant seeking review of the judgments. The Court of Special Appeals affirmed the awards.

Owens-Illinois v. Armstrong, 87 Md.App. 699 , 591 A.2d 544 (1991). ¹¹² This Court granted Owens-Illinois’ petition for certiorari. We shall address each issue raised by Owens-Illinois, amplifying when necessary the factual scenario presented above. BUSINESS RECORDS In 1969, a Bethlehem Steel industrial health engineer was directed by a vice president to conduct an asbestos exposure study and prepare a report on the exposure of both Bethlehem and non-Bethlehem personnel to asbestos-containing dust at Bethlehem’s facilities. The five-page report was offered into evidence by Owens-Illinois as a business record of Bethlehem Steel.

Owens-Illinois contends the Bethlehem study should have been admitted because it showed that, in three “bystander” dust counts taken around employees in the same jobs as Wood and Armstrong working in ship engine rooms where insulation was being installed, no measurable amount of asbestos fibers was detected. Although acknowledging that the report was prepared and maintained in the ordinary course of business, Armstrong and Wood objected to its admissibility. Judge Gordy ruled: “I don’t have any problem with this [meeting the] business record exception. That does not automatically make an exhibit admissible.

It gets over that hurdle, but it is significantly unreliable____ I am not satisfied that the conclusions or the results cited herein are reliable. It is not trustworthy____” On appeal, Owens-Illinois contends that “once a document has been found to be a business record there is no additional trustworthiness or reliability test unless [in a criminal case] the 6th Amendment is implicated.” We disagree with Owens-Illinois and hold that a trial judge has discretion to exclude a document that meets the technical requirements of a business record when the objecting party persuades the judge that the document lacks the degree of ¹¹³ reliability and trustworthiness that business records are ordinarily assumed to possess. 1 In Palmer v. Hoffman, 318 U.S. 109 , 63 S.Ct. 477 , 87 L.Ed. 645 (1943), tort actions were filed against a railroad for death and personal injuries arising out of a railroad accident at a grade crossing. Plaintiffs alleged that the railroad was negligent because the engineer failed to ring the bell, blow the whistle, and have a light burning at the front of the train when approaching the crossing. Two days after the accident, pursuant to railroad requirements, the engineer gave a signed statement to railroad officials and to a State Public Utilities Commission representative containing his version of the accident and denying any negligence.

Before trial the engineer died. At trial, the engineer’s statement was offered into evidence by the railroad as a business record. Plaintiffs’ objection to the admissibility of the statement was sustained, and after a verdict for the plaintiffs, the railroad appealed. The United States Supreme Court ultimately granted certiorari and upheld the trial judge’s decision not to admit the engineer’s statement.

Perhaps the best analysis of the Palmer decision is found in 2 McCormick on Evidence, § 288 at 272 (John W. Strong ed., 4th ed. 1992) (hereinafter, McCormick), which provides: “While Palmer has been subject to various interpretations, the most reasonable reading of it is that it did not create a blanket rule of exclusion for accident reports or similar records kept by businesses. Rather, it recognized a discretionary power in the trial court to exclude evidence which meets the letter of the business records exception, but which, under the circumstances, appears to lack the reliability business records are assumed ordinarily to have. The existence of a motive and opportunity to falsify the record, especially in the absence of any coun ¹¹⁴ tervailing factors, is of principal concern. The Federal Rule incorporates this reading of Palmer by permitting admission if the report otherwise complies with the requirements of the rule, ‘unless the source of information or the method or circumstances of preparation indicate lack of trustworthiness.’ ” (Footnotes omitted).

This Court has recognized that, in some instances, business records may be excluded if established to be unreliable or untrustworthy. In Marine Bank v. Stirling, 115 Md. 90, 102-03 , 80 A. 736, 739-40 (1911), a bank ledger on which checks “found loose in the bank” were entered was found too uncertain or unreliable to be admissible. We stated: “Such a claim would not ordinarily of itself affect the admissibility of an individual ledger, containing the accounts between depositors and the bank, but under such circumstances as are shown in this case there is too much indicating the uncertainty and unreliability of this ledger account to permit it to be used as evidence per se____” 115 Md. at 103 , 80 A. at 740 . The federal rules of evidence pertaining to the hearsay exception for business records and public records exclude otherwise admissible records if the sources of information or other circumstances “indicate lack of trustworthiness.” Federal Rules of Evidence 803(6) and 803(8).

In Ellsworth v. Sherne Lingerie, Inc., 303 Md. 581 , 495 A.2d 348 (1985), this Court examined the public records hearsay exception and held that “factual findings” contained in public records are admissible unless the party opposing introduction of a public record proves the factual finding is unreliable. Judge McAuliffe, writing for the Court, indicated how such unreliability may be established. The reasoning is equally applicable to proving a business or public record is untrustworthy. The Court stated: “We also make clear that even though the burden rests upon the party opposing the introduction of a public record to demonstrate the existence of negative factors sufficient to overcome the presumption of reliability, this ¹¹⁵ does not mean that additional evidence will be required in every case to meet that burden.

Indicia of unreliability may be contained in the report itself, or may be disclosed by the evidence of the party offering the report.” 303 Md. at 612 , 495 A.2d at 364 . The factors that can be utilized by a trial judge in determining whether a business record or a portion of a business record should be excluded for lack of trustworthiness may include such factors as: 1) the purpose for which the record was prepared and any possible motive to falsify including whether the record’s use in prospective litigation was a motive for its preparation, see Rossi v. Mobil Oil Corp., 710 F.2d 821, 830 (Temp.Emer.Ct.App.1983), Jefferson Garden Associates v. Greene, 202 Conn. 128 , 520 A.2d 173, 181 (1987); 2) how routine or non-routine the record is and how much reliance the business places on the record for business purposes, Palmer v. Hoffman, supra; and 3) where, as in the instant case, the record contains opinions and conclusions- — how valid, speculative, or conjectural the opinions or conclusions are, as well as the need for interpretation or cross-examination to prevent misleading or confusing the trier of fact. See 2 McCormick, § 293 at 280-81. Wood and Armstrong contend that the trial judge was correct in his determination that the disputed “business record” of the asbestos dust study was untrustworthy.

The Court of Special Appeals aptly noted that the study was made at the request of one of Bethlehem’s vice-presidents and “[o]n its face, the report appears to be a single or, at most irregular, request.” 87 Md.App. at 712 , 591 A.2d at 550 . The industrial health engineer may have been reluctant to report that personnel, including non-Bethlehem personnel, were being exposed to potentially lethal levels of asbestos dust. Armstrong and Wood point to a number of additional reasons why the report lacks trustworthiness which we note might also go to its relevancy. Armstrong had left Bethlehem six years before the study, and Wood had started working in the shipyard twenty-eight years ¹¹⁶ before the date of the study.

The report does not indicate what products were being used in 1969 when the asbestos dust counts were done and that this information would be important because manufacturers had reduced or eliminated the asbestos in their insulation by 1969. The report also does not indicate whether the working conditions and dust exposure of the employees in the 1969 study were similar in relevant aspects to the working conditions and dust exposure of Wood and Armstrong. The Owens-Illinois product Kaylo was apparently not one of the insulating products in use during the 1969 asbestos dust study, since Owens-Illinois had stopped manufacturing Kaylo eleven years before the study, and we have no description of the asbestos content, if any, of the insulation products that were in use during that study. Further, the trial judge was concerned that the report lacked sufficient specificity as to the methodology used in conducting the study.

For the reasons indicated, the trial judge did not err in concluding that the “business record” lacked trustworthiness, and if the 1969 dust study results were to be admitted, the personnel conducting the study would have to be called as witnesses to establish the study’s validity. Although we sustain the trial judge’s ruling which excluded the “business record” in the instant case because it lacked trustworthiness, we hasten to add that, where a record qualifies as a business record, there is a presumption of trustworthiness, and the objecting party, especially in a civil case, bears a heavy burden in order to exclude an otherwise admissible business record as untrustworthy. PROXIMATE CAUSE Owens-Illinois’ next contention is that Armstrong did not prove proximate cause because he “failed to present any evidence that had a warning been given, it would have been heeded.” That contention is based in part on the fact that Armstrong smoked cigarettes for forty years until he quit in the mid-1970’s despite health warnings that were placed ¹¹⁷ on cigarette packages after January 1, 1966. Therefore, according to Owens-Illinois, the lack of a warning on its asbestos product was not the proximate cause of Armstrong’s asbestosis because there is no evidence that he would have heeded that warning.

In analyzing this issue, we must keep in mind that we are being asked to declare as a matter of law that there was insufficient evidence to have submitted this aspect of the case to the jury. Under these circumstances, an appellate court must view the evidence in the light most favorable to the prevailing party below, resolving all conflicts in its favor. Lehman v. Balto. Transit Co., 227 Md. 537, 540-41 , 177 A.2d 855, 857 (1962). “A party is not entitled to judgment n.o.v. unless the facts and circumstances so considered are such as to permit of only one inference with regard to the issue presented.” Impala Platinum v. Impala Sales, 283 Md. 296, 327 , 389 A.2d 887, 905 (1978).

Causation is a necessary element of any strict liability action. Phipps v. General Motors Corp., 278 Md. 337, 344 , 363 A.2d 955, 958 (1976). In considering whether causation has been proven in a failure to warn strict liability action, the trier of fact is entitled to draw the reasonable inference that people are assumed to act for self-preservation absent proof to the contrary. See Md. Central R.R. v. Neubeur, 62 Md. 391, 402 (1884); Nizer v. Phelps, 252 Md. 185, 205, 249 A.2d 112, 123 (1969).

Owens-Illinois asserts that Armstrong’s “testimony that he smoked for forty years is sufficient evidence to rebut a ‘self-preservation’ presumption.” We disagree and hold that the issue of causation was properly submitted to the jury. This issue was addressed in Raney v. Owens-Illinois, 897 F.2d 94 (2nd Cir.1990). There the U.S. Court of Appeals for the Second Circuit held: “[A] prediction as to what a worker, alerted to the [asbestos] hazards, would have done is generally within the range of reasonable dispute that makes matters appropri ¹¹⁸ ate for submission to a jury. Evidence that [decedent], who had begun smoking and perhaps had become addicted years before cigarette health warnings appeared, did not stop smoking after such warning ... is, at most, a circumstance for the trier to consider in deciding whether an asbestos warning would have been heeded.

Such evidence does not preclude a finding in plaintiffs favor. As [the trial judge] noted, a jury could reasonably conclude that [decedent] would have adjusted his conduct more significantly to asbestos warnings than to cigarette warnings____” 897 F.2d at 96. See also Skonberg v. Owens-Corning Fiberglas Corp., 215 Ill.App.3d 735 , 159 Ill.Dec. 359, 363 , 576 N.E.2d 28, 32 (1991). The fact that Armstrong was a heavy smoker who ignored warnings placed on cigarette packages during the last decade of the forty-year period when he smoked is not enough evidence to find as a matter of law that he would have ignored warnings about the dangers of asbestos.

We find that there was sufficient evidence for the jury to reasonably conclude Armstrong would have heeded a warning of health hazards from inhalation of asbestos-containing dust from Kaylo products and that Owens-Illinois’ failure to warn was the proximate cause of Armstrong’s asbestosis. SUBSTANTIAL FACTOR Wood testified that while assisting workers installing Kaylo pipe-covering, large amounts of dust “would fly like snowflakes” in the air around them. Armstrong testified that he was exposed to dust from pipe-covering material at the shipyard. One of Armstrong’s fellow employees who worked with him for years testified that Armstrong labored near pipe-coverers using Kaylo, which created clouds of dust that completely coated the workers.

Expert witnesses testified that the occupational exposure to asbestos was a substantial factor in causing Wood’s and Armstrong’s asbestosis. The trial judge instructed the jury: ¹¹⁹ “In order for a plaintiff to recover against a particular defendant, certain things must be shown — must be proved by the plaintiffs by a preponderance of the evidence. You must determine whether each plaintiff has proven by a preponderance of the evidence that he has asbestosis, he worked in proximity to and inhaled respirable asbestos fibers from the products of a particular defendant. It must be shown that a product or products manufactured or supplied by that defendant, by a particular defendant was a substantial factor in causing the asbestosis.

If no product manufactured or supplied by a particular defendant was a substantial factor in causing the asbestosis, then that defendant has no responsibility, and the defendant is out right away. Unless there is a product that was manufactured or supplied by a particular defendant which was a substantial factor in causing the asbestosis, there is no responsibility on the part of that defendant.” Owens-Illinois contends that the instruction was deficient because it failed to adequately address the special legal meaning of “substantial factor.” The company insists that the jury should have been instructed that, in order for its product to be a substantial factor in causing asbestosis, plaintiffs must show that each of them worked in proximity to Kaylo with enough frequency and with enough regularity for the inhaled fibers from Kaylo to have substantially contributed to their asbestosis. We need not decide whether the requested instruction was correct, since the matter was fairly covered by the instruction actually given. We believe that in the instant case “substantial factor” was not a mysterious phrase requiring elucidation.

The phrase has even been considered as one that is “sufficiently intelligible to furnish an adequate guide in instructions to the jury, and that it is neither possible nor desirable to reduce it to any lower terms.” See W. Page Keeton, Prosser and Keeton on Torts, § 41 at 267 (5th ed. 1984) and authorities cited therein. The plaintiffs’ expert wit ¹²⁰ nesses obviously understood the phrase “substantial factor” and, no doubt, so did the jury. In the instant case, especially in light of the expert testimony and the nature and extent of Wood’s and Armstrong’s exposure to Kaylo, the judge