On March 30, 2018, Judge Rya Zobel of the United States District Court (District of Massachusetts) issued a memorandum of decision on two Defendants’ (NSTAR Electric, formerly Boston Edison, and General Electric) Motions for Summary Judgment in an asbestos personal injury and wrongful death matter, June Stearns and Clifford Stearns as Co-Executors of the Estate of Wayne Oliver v. Metropolitan Life Insurance Co., et al., that addresses multiple issues, including statute of repose, strict liability and liability of a premises owner.
Plaintiff’s decedent, Wayne Oliver, worked on the construction of two power plants, Pilgrim Nuclear Power Station (Massachusetts) and Calvert Cliffs Nuclear Power Plant (Maryland), between 1971 and 1978 and his estate alleges that Mr. Oliver was exposed to asbestos-containing products present at those sites. Defendant NSTAR Electric (formerly Boston Edison)(“Boston Edison”) owned the Pilgrim premises. Defendant General Electric (“GE”) allegedly designed, manufactured, and sold generators used at Pilgrim and at Calvert Cliffs. Oliver worked as a pipe inspector for Bechtel, the architect-engineer on projects at both Pilgrim and Calvert Cliffs.
As the owner of Pilgrim, Boston Edison conducted safety audits while the construction proceeded, but primary responsibility for the site construction rested with GE and Bechtel: GE for the steam supply system, nuclear fuel system, and the generators themselves; and Bechtel for everything else. In that capacity, Bechtel hired and supervised all subcontractors on the project, including an insulation installer, New England Insulation (“NEI”). Although NEI reported to Bechtel, it installed the asbestos-containing insulation around the generators pursuant to directions from both Bechtel and GE, and pursuant to GE’s specifications that specifically required asbestos-containing insulation. The Court also recognized that at both Pilgrim and at Calvert Cliffs, GE had rejected suggestions or proposals for an asbestos-free insulation alternative.
Oliver allegedly sustained exposure to asbestos at both sites while inspecting pipe near dusty thermal insulation as other subcontractors installed it around the generators. He was subsequently diagnosed with mesothelioma in 2015 and died in 2016. In denying summary judgment to GE and granting summary judgment to Boston Edison, the Court found that: (1) while the construction work performed by GE met the definition of an improvement to real property for purposes of the statute of repose, public policy considerations necessitated an exception to the application of the statute in cases involving alleged asbestos-related disease; (2) the installation of asbestos insulation was not an abnormally dangerous activity; (3) Boston Edison did not exercise sufficient control over the work at issue to be held negligent; and (4) a premises owner, such as Boston Edison, has no duty to warn where the subcontractor has knowledge of the hazard which is equal to or greater than that of the premises owner.
Application of Statute of Repose
GE argued protection from Plaintiffs’ claims under Massachusetts’s six-year statute of repose, which bars claims concerning “improvements to real property.” Under Massachusetts law, this involves a “permanent addition” versus “ordinary repair.” Whether this statute applied to asbestos claims against manufacturers posed an issue of first impression for the Court. GE argued that its generators were permanent improvements to the plant. Plaintiff disagreed, and further argued that public policy prevented the application of the statute to asbestos claims given their long latency.
Ultimately, the Court agreed with GE that the generators were permanent improvements, but found that public policy cut against the application of the statute of repose to GE’s benefit. Though the public policy behind statutes of repose is based on the policy judgment that a potential defendant should have no reasonable expectation of responsibility for injuries that occur after the passage of a number of years, the Court held that such a policy rationale does not apply to asbestos cases because: (1) the potential dangers associated with asbestos exposure were well known by 1971; and (2) the typical latency period from asbestos exposure to disease is much longer than the six-year window for filing personal injury claims under the statute of repose. Accordingly, the Court found that an asbestos defendant should not have a reasonable expectation that an injury, if one should occur, would likely manifest itself within the six year statute of repose.
The Court further relied on what it called a “somewhat relaxed” burden of proof in asbestos cases, thereby minimizing the argument that evidence relied upon by the parties would become stale over the passage of time, another policy reason behind the application of statutes of repose. The Court also noted that GE’s responsibility was not typical of a manufacturer that releases its products to an end user without much retained control. In this case, GE directed the material selection and at least some of the work allegedly giving rise to the exposure. In addition, GE continued to exercise some level of control for an extended period of time through on-site maintenance and inspections following completion of the project. On these grounds, the Court refused to bar Plaintiffs’ claims against GE on statute of repose grounds.
Although the decision purports to rely on a case-by-case factual approach to the application of the statute of repose, as evidenced by the Court’s statement that “although designers, engineers, and contractors like GE appear facially covered by the statute of repose, their protection is ultimately determined by reference to underlying acts.” the Court implicitly states that the statute of repose can never properly apply to asbestos claims, because such application would bestow upon asbestos defendants “absolute immunity” due to the typical latency period for asbestos-related diseases.
Strict Liability of Premises Owner
Plaintiff argued for the imposition of strict liability on Boston Edison based on the premise that the act of insulating equipment with asbestos-containing insulation amounted to an abnormally dangerous activity. Massachusetts imposes a balancing test on the application of strict liability in which the court evaluates: (a) whether an activity risks harm; (b) the magnitude of the harm; (c) whether the risk can be mitigated with reasonable care; (d) whether the activity is a common one; (e) whether the activity is appropriate where it is taking place; and (f) the activity’s value to the community. Here, the Court disagreed with Plaintiff’s argument and found that, despite the risk of significant harm posed by asbestos-containing insulation, the fact that asbestos insulation was commonly used during the time frame at issue, and the possibility of taking reasonable precautions to mitigate that harm weighed against the imposition of strict liability. Accordingly, the Court granted summary judgment in favor of Boston Edison on Plaintiffs’ strict liability claim. This decision suggests that, going forward, the Court will not be receptive to the blanket categorization that asbestos products are abnormally dangerous.
Negligence of Premises Owner
In addition, Plaintiffs argued that, to the extent Plaintiff’s employer, Bechtel, was negligent by exposing him to asbestos, Boston Edison bears vicarious responsibility. In Massachusetts, an employer of an independent contractor on their premises is not liable for harm caused by that independent contractor’s negligence, unless the employer retains control over performance of the work. Plaintiffs argued that Boston Edison’s authority to monitor the construction, coupled with the ability to shut down the project, rose to a sufficient level of control. The Court disagreed, and considered the right of inspection and the right to impose work stoppage insufficient levels of control to justify imposition of vicarious liability, and granted summary judgment. This decision supports the arguments of premises owners charged with responsibility for their independent contractors, and reaffirms the importance of clearly delineated responsibilities.
Plaintiffs further argue that, as premises owner, Boston Edison negligently failed to give Oliver’s employer a warning regarding the dangers of on-premises asbestos. Massachusetts landowners owe a duty of reasonable care to employees of independent contractors. However, courts distinguish pre-existing hazards with those created by the work the independent contractor undertakes to perform. With the latter, the independent contractor stands on equal footing with regard to the risk. The Court considered the insulation a case of the latter—where Boston Edison’s knowledge of the risks of asbestos was no greater than Bechtel’s, Boston Edison had no duty to warn, and therefore no liability, and granted summary judgment. This decision cuts against plaintiffs’ attempts to make premises owners the effective “insurers” for on-premises work, the nature of which subcontractors may be more or equally aware.