Thofson v. Redex Industries, Inc.

433 N.W.2d 901, 1988 Minn. App. LEXIS 1233, 1988 WL 134624
CourtCourt of Appeals of Minnesota
DecidedDecember 20, 1988
DocketC6-88-1770
StatusPublished
Cited by5 cases

This text of 433 N.W.2d 901 (Thofson v. Redex Industries, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Minnesota primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thofson v. Redex Industries, Inc., 433 N.W.2d 901, 1988 Minn. App. LEXIS 1233, 1988 WL 134624 (Mich. Ct. App. 1988).

Opinion

OPINION

NIERENGARTEN, Judge.

The appellants argue the district court erroneously concluded damage to com and other property caused by a fire in a grain dryer did not constitute damage to “other property” and assert the economic loss resulting from the fire was not a “reasonable economic expectation.” The appellants also contend the court improperly granted summary judgment on their negligent misrepresentation claim. We affirm.

FACTS

Appellants Virgil and Arlene Thofson purchased a grain dryer manufactured by Redex Industries, Inc. (Redex), the corporate predecessor of respondent Blount Agri/Industrial Corporation. The grain dryer worked satisfactorily for several years. On the evening of October 18,1985, a gas valve in the drying unit apparently malfunctioned and allegedly caused a fire which destroyed the grain dryer, 1,000 bushels of corn in the dryer, and some incidental equipment.

The Thofsons and their property loss insurer, appellant Farmers Mutual Insurance Company, sued Redex, Blount Agri/In-dustrial and Honeywell, Inc. 1 claiming the dryer or its component parts were “in a defective condition unreasonably dangerous.” The Thofsons and Farmers Mutual claimed the respondents negligently designed and manufactured the dryer and asserted the respondents were strictly liable for the loss of the grain dryer, destruction of the corn in the dryer, damage to the incidental equipment, and consequential loss of income. They also asserted a claim for punitive damages. The Thofsons and Farmers Mutual claimed the respondents knew or should have known of the alleged defect but failed to disclose the dangers, and asserted the respondents’ alleged “intentional and/or negligent misrepresentations” were a proximate cause of the fire.

The punitive damages claim was dismissed. Redex, Blount Agri/Industrial and Honeywell moved for summary judgment asserting the negligence and strict liability claims were barred by the Super-wood, doctrine. The respondents also asserted there were no genuine issues of fact relative to the misrepresentation claim.

The district court found there were no genuine issues of material fact and that the respondents were entitled to judgment as a matter of law. The court concluded the Superwood doctrine applied even if the alleged defect was unreasonably dangerous and that the Thofsons should not recover substantial economic damages merely because of the relatively minor damage to the incidental equipment. The court also concluded the grain dryer malfunction and the resulting loss of grain in the dryer were not unexpected occurrences. The court noted that the allegations of misrepresentation were based upon “some thin hearsay” from a former Redex employee who allegedly stated Redex was aware of similar malfunctions in other grain dryers. According to the court, the Thofsons and Farmers Mutual failed to offer specific facts to support their allegations or show there were genuine issues of material fact.

*903 The Thofsons and Farmers Mutual appeal from the summary judgment.

ISSUES

1. Did the district court err by concluding damage to grain in a grain dryer caused by a malfunction of the dryer did not constitute damage to “other property”?

2. Did the district court err by granting summary judgment on the appellants’ negligent misrepresentation claim?

ANALYSIS

The district court must render summary judgment

if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that either party is entitled to a judgment as a matter of law.

Minn.R.Civ.P. 56.03. This court must examine the record to determine whether there are any material issues of fact and whether the district court erroneously applied the law. Minneapolis, St. Paul & Sault Ste. Marie Railroad v. St. Paul Mercury Indemnity Co., 268 Minn. 390, 406, 129 N.W.2d 777, 788 (1964).

1. Damage to “Other Property”

In Superwood Corp. v. Siempelkamp Corp., 311 N.W.2d 159 (Minn.1981), the supreme court concluded the uniform commercial code provisions which govern commercial transactions would be emasculated if economic losses arising out of commercial transactions were recoverable under tort liability theories. See id. at 162. Accordingly, the court held:

[Ejconomic losses that arise out of commercial transactions, except those involving personal injury or damage to other property, are not recoverable under the tort theories of negligence or strict products liability.

Id.

The Thofsons and Farmers Mutual contend the Redex grain dryer was “unreasonably dangerous” and assert economic losses caused by “dangerous defects” are excepted from the Superwood doctrine. We disagree. Although the supreme court suggested it might consider a distinction between losses caused by a “qualitative defect” and losses which result from a “sudden and calamitous occurrence,” the court has not yet recognized that distinction when economic losses arise within the context of a commercial transaction. See S.J. Groves & Sons Co. v. Aerospatiale Helicopter Corp., 374 N.W.2d 431, 434-35 (Minn.1985). This court has held damages to defective products are not recoverable under Superwood “even when the defect creates an unreasonable danger to persons or other property.” See St. Paul Fire & Marine Insurance Co. v. Steeple Jac, Inc., 352 N.W.2d 107, 110 (Minn.Ct.App.1984), pet. for rev. denied (Minn. Jan. 4, 1985); see also Nelson v. International Harvester Corp., 394 N.W.2d 578 (Minn.Ct.App.1986), pet. for rev. denied (Minn. Dec. 12, 1986) (fires caused by defective fuel systems destroyed farm combines; the plaintiffs’ strict liability and negligence claims were barred by Superwood); Tri-State Insurance Co. v. Lindsay Brothers Co., 364 N.W.2d 894 (Minn.Ct.App.1985), affd without published opinion, 381 N.W.2d 446 (Minn.1986) (a fire caused by a design defect destroyed a grain dryer; the cost of repairing the dryer was a nonrecoverable economic loss).

We must determine whether the damage to the com in the Thofsons’ grain dryer constituted damage to “other property.” In Holstad v. Southwestern Porcelain, Inc., 421 N.W.2d 371

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Related

State v. Marshall
2002 WI App 73 (Court of Appeals of Wisconsin, 2002)
In Re Grain Land Coop
978 F. Supp. 1267 (D. Minnesota, 1997)
Hapka v. Paquin Farms
458 N.W.2d 683 (Supreme Court of Minnesota, 1990)

Cite This Page — Counsel Stack

Bluebook (online)
433 N.W.2d 901, 1988 Minn. App. LEXIS 1233, 1988 WL 134624, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thofson-v-redex-industries-inc-minnctapp-1988.