State of New York OPINION
Court of Appeals This opinion is uncorrected and subject to revision
before publication in the New York Reports.
No. 29
Sofia Fasolas, &c.,
Respondent,
v.
Bobcat of New York, Inc., et al.,
Defendants,
Bobcat of Long Island, Inc., et al.,
Appellants,
Port Jefferson Rental Center, Inc.,
&c.,
Respondent.
Brendan T. Fitzpatrick, for appellants.
Andrew H. Pillersdorf, for respondent Fasolas.
Scott C. Watson, for respondent Port Jefferson Rental Center.
Defense Association of New York, Inc., amicus curiae.
DiFIORE, Chief Judge:
In Scarangella v Thomas Built Buses (93 NY2d 655 [1999]) we recognized an
exception to the general rule of strict products liability for design defects, where the
manufacturer offers a product with an optional safety device and the purchaser chooses not
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to obtain it. In this case, we must examine whether the exception is categorically
unavailable when the allegedly defective product came into the injured end user’s hands
through the rental market, rather than by a purchase transaction. We conclude that no such
“rental market” exclusion from Scarangella is appropriate, and that jury instructions
incorporating the rental market theory espoused by plaintiff’s expert were misleading and
incompatible with governing precedent. Accordingly, we reverse the Appellate Division
order and remit for a new trial as to the manufacturer’s liability.
Elias Fasolas was killed while operating a Bobcat S-175 “skid-steer” loader (the
loader) with a bucket attachment when a small tree entered the open operator cab, crushing
him. Fasolas obtained the loader from defendant Port Jefferson Rental Center, Inc. d/b/a
Taylor Rental Center (Taylor), a retail rental center, pursuant to a two-day rental contract.
Defendant Bobcat Company manufactured the loader and defendant Bobcat of Long
Island, Inc., a distributor (collectively, Bobcat),1 sold it to Taylor in November 2006, along
with three others at a price of approximately $22,000 each. Taylor had similarly purchased
twenty S-175 loaders with bucket attachments from Bobcat during the preceding decade,
which were rented to a diverse clientele including schools, fire departments, churches, local
businesses, contractors and homeowners. Plaintiff Fasolas’ estate brought strict products
liability claims against Bobcat and Taylor on defective design and failure to warn theories,
among others.
1
Bobcat of Long Island, Inc. is a d/b/a of Bobcat of New York, Inc., which is named in the
caption along with Bobcat of London, which is not mentioned in any allegations in the
complaint. Only Bobcat Company and Bobcat of Long Island, Inc. appear in this Court.
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The Bobcat S-175 loader is a ride-on machine that can be used for multiple light
construction functions. It consists of a motorized base with wheels and hydraulic arms that
can be raised and lowered. The loader can be used for different functions when connected
to different attachments. It has an open front operator cab and includes rollover protection
and fall protection systems as standard safety features. According to the manufacturer, the
cab is open for easy use, convenient entry and exit and to promote operator visibility.
The loader can accommodate up to 150 different attachments, which are purchased
separately. Each attachment performs a different function, enabling the machine to be
customized for use for a variety of distinct tasks. The bucket attachment, which is available
with or without teeth, is intended to be used to level soil and pick up or transport dirt,
broken branches and other loose debris. A bucket with teeth, the attachment on the loader
rented by Fasolas, is also able to dig up and loosen hard-packed earth. Some attachments
– such as the “brush saw” and “jackhammer” – come with a “special applications kit” as a
standard feature due to the potential for flying debris to enter the cab during the types of
operation calling for those attachments. The special applications kit consists of a top, rear
windows and front door made of a half-inch-thick plexiglass called “Lexan” (“the door
kit”) and can be attached to the loader to enclose the cab and thus restrict airborne material
from entering that area.
Although it came standard with some attachments, the door kit could also be
purchased as an optional component at an approximate cost of $800 to $1000 and used
when the loader was equipped with the bucket attachment. However, Bobcat did not
recommend the door kit for use with a bucket attachment like the one rented to Fasolas,
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since debris would not be expected to fly into the cab if the bucket was used as intended –
to dig or move soil and other loose debris. According to Bobcat, the loader with bucket
attachment was not intended to be used to knock down rooted trees, as other attachments
were available for that function.
The precise circumstances surrounding Fasolas’ rental and use of the loader remain
unclear. However, Taylor employees testified that it was standard practice to carefully
question each prospective renter of a loader about the intended use of the product,
explaining that they would refuse to rent the loader with bucket attachment for
inappropriate tasks, such as removing tree stumps. According to the investigating
detective, the 9-foot-tall tree that killed Fasolas was still rooted in the ground and
apparently slid past the loader’s bucket attachment, entering the open cab. Post-accident
photographs admitted at trial show the loader that Fasolas was operating at rest in an area
comprised of brush and small trees.
As relevant here, plaintiff alleged that the loader was defectively designed because
it did not incorporate the optional door kit.2 At trial, plaintiff’s expert testified that the
failure to include the door kit as a standard feature for any S-175 loader with bucket
2
Plaintiff also raised a defective warning claim, alleging that Bobcat and Taylor failed to
properly advise and train Fasolas on the availability of the door kit and the proper use of
the loader. However, because the jury credited the failure to warn theory only as against
Taylor (who is not an appellant in this Court), that claim is not at issue in this appeal
brought by the Bobcat defendants. Indeed, Taylor appeared in this Court as a party
respondent and joined plaintiff in defending the judgment, arguing that the Scarangella
exception is inapplicable and that the jury charge was correct. Thus, Taylor’s liability to
plaintiff (under any theory) is both settled given the finality of the judgment as against it
and beyond the scope of this appeal.
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attachment destined for the rental market was a “design defect” and that the Lexan door
could have saved Fasolas’ life by deflecting the tree from entering the cab. He conceded
that the loader as configured without the door kit was not defective for all uses. His theory
was that the defect was present when the product was placed in the “rental market” because,
in his view, this created the potential for an untrained end-user to use the product in a
manner for which the optional door kit would be recommended. Thus, the expert further
opined that every piece of equipment going to the “rental market” needed “all of the safety
devices available.” The expert did not offer a basis for the implicit conclusion that a
purchaser of the product would necessarily have more training or experience than a renter
or would be better able to do without optional safety devices. Moreover, the expert
admitted that the loader and the cab’s opening complied with all industry standards for
skid-steer loaders and represented industry “best practice”; he conceded that no industry
writing, standard or expert supported his opinion that a loader sold to a rental company
required a door kit as a standard feature.
Bobcat’s position at trial was that the S-175 loader with bucket attachment was not
defective without the door kit when used for its intended purpose – to move soil. Bobcat
contended that Taylor had been made aware of the availability of the door kit through a
variety of means, including handbooks and safety manuals accompanying the machines,
and conversations between employees of Bobcat’s distributors and Taylor’s employees.
Bobcat’s employees testified that, upon delivery of each loader to Taylor, each item on a
general checklist was checked off (ostensibly indicating it had been discussed), including
the availability of the optional door kit. Bobcat’s theory was that Fasolas misused the
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product by attempting to plow over or dig up trees, which was not a proper use of the loader
with bucket attachment. The manufacturer’s employees explained that different
attachments for the loader are available for leveling trees and include the door kit as a
standard feature to prevent airborne material from entering the cab.
At the close of plaintiff’s case, the Bobcat defendants moved pursuant to CPLR 4401
for judgment as a matter of law dismissing the complaint against them, contending, among
other things, that they could not be liable for failing to make the door kit a standard feature
and should be relieved from strict liability under Scarangella. Tracking the 3-pronged
Scarangella test, Bobcat argued that (1) Taylor, the purchaser, was thoroughly
knowledgeable about the loader with the bucket attachment and actually aware that the
door kit was available; (2) under normal circumstances of use the loader with bucket
attachment was not unreasonably dangerous without the optional door kit; and (3) Taylor
was in a superior position than Bobcat to balance the benefits and risks of not purchasing
the optional safety kit for the product’s contemplated use by its clientele, including Fasolas.
The trial court reserved decision on the motion and denied Bobcat’s request that the
jury be instructed to consider whether Bobcat satisfied the Scarangella test. In its strict
product liability charge, over Bobcat’s objection, the court departed from the pattern jury
instructions (PJI 2:120), fashioning a new charge advising the jury that it could find that
the loader was “defective if it’s not reasonably safe, and in this case we mean reasonably
safe to be put in the rental market (emphasis added).” The jury was also instructed to
consider whether the loader was defective because it did not “include a protective front
door . . . for the purposes of being rented (emphasis added).” Additional modifications,
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similarly incorporating the rental market theory propounded by plaintiff’s expert,
permeated the charge.
The jury found that Fasolas was not at fault and rendered a verdict in favor of
plaintiff, awarding $1 million in damages and finding the Bobcat defendants and Taylor
liable on the defective design theory. It did not credit the failure to warn theory as against
Bobcat but found that Taylor’s warnings were defective and that its training of the deceased
was inadequate. Twenty-five percent of the fault was apportioned to each Bobcat
defendant and fifty percent to Taylor.
The court denied Bobcat’s motion to set aside the verdict, rejecting the argument
(among others) that the court erred in modifying the product liability charge to reflect the
“rental market” theory. The court reasoned there were “two streams of commerce into
which the [loader] . . . was released and to which the Bobcat Defendants owed a duty,” and
it was the “home owner, non-professional occasional renter who deserved protection from
such dangers as befell the Plaintiff’s decedent herein” (internal quotation marks omitted).
The Appellate Division affirmed, framing the question as “whether the manufacturer
and seller of a product that is allegedly defective because of the absence of an optional
safety device can invoke the Scarangella exception to liability where the product was sold
to a buyer which, in turn, rented the product to the ultimate consumer” (150 AD3d 147,
150 [2d Dept 2017]). The court answered that question in the negative, holding “that the
Scarangella exception is not applicable where, as here, the product is sold to a rental
company” (id. at 150-151). The court reasoned that Bobcat knew “Taylor would be renting
the loader to persons over whom Taylor had no control, and who might lack any experience
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operating heavy equipment.” The court further speculated that Taylor had little motivation
to engage in a reasonable risk-benefit analysis because its agent who purchased the
machine “was not at risk of personal harm through use of the loader without the optional
safety device” (id. at 156). The court distinguished Taylor’s position from that of the buyer
in Scarangella, an employer in control of the worksite where its employees would be
mainly at risk.
We granted the Bobcat defendants leave to appeal to this Court (31 NY3d 906
[2018]). Because we do not adopt the rental market distinction as a limitation on our
holding in Scarangella and conclude that plaintiff’s expert’s theory was improperly
incorporated into the strict products liability instruction charged to the jury, we reverse the
Appellate Division order and remit for a new trial as against them on the design defect
claim.
Our recognition of the strict product liability cause of action in Codling v Paglia (32
NY2d 330 [1973]) rested on the principle that the manufacturer is in a superior position to
know when its product is suitably designed and safely made for its intended purpose. Thus,
imposing strict liability on the manufacturers for defects in the products they manufactured
“should encourage safety in design and production, and the diffusion of this cost in the
purchase price of individual units should be acceptable to the user if” it results in added
assurance of protection (id. at 341). Although originally applied to cases involving
manufacturing defects, the cause of action evolved to include claims based on defective
design (Voss v Black & Decker Mfg. Co., 59 NY2d 102 [1983]) and inadequate warnings
(Liriano v Hobart Corp., 92 NY2d 232 [1998]).
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“[A] defectively designed product is one which, at the time it leaves the seller’s
hands, is in a condition not reasonably contemplated by the ultimate consumer and is
unreasonably dangerous for its intended use” and “whose utility does not outweigh the
danger inherent in its introduction into the stream of commerce” (Voss, 59 NY2d at 107
[internal quotation marks and citation omitted]). In a design defect case, the question for
the jury “is whether after weighing the evidence and balancing the product’s risks against
its utility and cost . . . the product as designed is not reasonably safe” (id. at 109). In Voss,
we identified a series of factors that are relevant to the jury’s risk-utility analysis, including:
(1) the product’s utility “to the public as a whole and to the individual user; (2) the nature
of the product – that is, the likelihood that it will cause injury; (3) the availability of a safer
design; (4) the potential for designing and manufacturing the product so that it is safer but
remains functional and reasonably priced; (5) the ability of the plaintiff to have avoided
injury by careful use of the product; (6) the degree of awareness of the potential danger of
the product which reasonably can be attributed to the plaintiff; and (7) the manufacturer’s
ability to spread any cost related to improving the safety of the design” (id. [internal
citations omitted]; Yun Tung Chow v Reckitt & Colman, Inc., 17 NY3d 29, 34 [2011]).
These factors are “rooted in a recognition that there are both risks and benefits associated
with many products and . . . instances in which a product’s inherent dangers cannot be
eliminated without simultaneously compromising or completely nullifying its benefits”
(Denny v Ford Motor Co., 87 NY2d 248, 257 [1995]).
In Scarangella (93 NY2d 655), we recognized an exception to the general rule of
strict liability for design defects, where the manufacturer offers a product with an optional
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safety device that is not a required accessory, the purchaser chooses not to buy it and an
injured party claims the product is defective due to the absence of the accessory. There,
the plaintiff – a bus driver – was injured when struck by a bus that was being operated in
reverse by a co-worker. She brought a defective design claim against the bus
manufacturer, claiming the bus should have been equipped with an automatic back-up
alarm because a driver always has a substantial blind spot when operating in reverse. The
manufacturer offered an optional back-up alarm but plaintiff’s employer declined to
purchase it because it was noisy and the employer was concerned about receiving
complaints from the bus yard’s suburban neighbors, instead opting to instruct drivers to
sound the horn when reversing.
In determining that the manufacturer should not be liable for the accident, we held
that a product is not defective -- and a manufacturer or seller is not strictly liable for a
design defect based upon a claim that optional safety equipment should have been a
standard feature -- when the following three conditions are met: “(1) the buyer is
thoroughly knowledgeable regarding the product and its use and is actually aware that the
safety feature is available; (2) there exist normal circumstances of use in which the product
is not unreasonably dangerous without the optional equipment; and (3) the buyer is in a
position, given the range of uses of the product, to balance the benefits and the risks of
not having the safety device in the specifically contemplated circumstances of the buyer’s
use of the product” (id. at 661 [emphasis in original]). When these elements are present,
“the buyer, not the manufacturer, is in the superior position to make the risk-utility
assessment, and a well-considered decision by the buyer to dispense with the optional
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safety equipment will excuse the manufacturer from liability” (id.).
There is no claim here that Scarangella was wrongly decided. Rather, the dispute is
over whether the exception is categorically unavailable to a manufacturer that sells its
product to purchasers known to rent the product to the public. Bobcat asks this Court to
reject the holding below that Scarangella has no application where “the product is sold to
a rental company” – a conclusion apparently reached by no other court. The trial court
denied Bobcat’s request for a Scarangella charge and altered the pattern jury instruction
based on the rental market theory of plaintiff’s expert. The Appellate Division reasoned
that Scarangella was not available here because, as a rental agent, Taylor did not retain
“control” over the loader’s use and thus could not have been in a superior position to engage
in the risk-utility analysis required by prong three. We do not agree.
Both courts misinterpreted the third Scarangella factor which requires consideration
of the purchaser’s ability, in light of the possible uses of the product, to assess the risks and
benefits of purchasing the safety device given the circumstances and the contemplated uses
of the product at the time of acquisition. For these purposes, the contemplated “use” of
the product was not “rental” or “placement in the rental market” – that is merely the process
by which the product came into the hands of the end user. The preoccupation with this
process deviates from our analysis in Scarangella by shifting the focus away from the
purchaser’s knowledge of the product and ability to make a reasoned judgment concerning
the utility of the safety feature and toward the nature of the marketplace through which the
product passed.
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Bobcat’s theory was that the loader was not unreasonably dangerous without the
optional door kit when used for its intended purpose of moving soil and that Taylor knew
its own clientele and was in control of who would have access to the loader (i.e., its rental
customers) and for what purpose. Thus, it argued that Taylor was in a superior position,
given the wide range of uses of the product, to balance the benefits and risks of not
purchasing the door kit in the specifically-contemplated circumstances of its clients’
intended uses. Taylor’s status as a retail rental company does not establish, as a matter of
law, that it was not in a position to engage in the balancing analysis contemplated by the
third prong of Scarangella. Without question, whether the buyer exercises control over the
product’s use in its capacity as an employer or otherwise is a consideration that is relevant
to a determination of the buyer’s relative “position” to engage in the proper balancing
inquiry – but it is not dispositive.3 A lessor may be able to appropriately mitigate risk by
carefully controlling to whom it rents its products and for what use. In this case, testimony
was presented that Taylor rented its products to businesses, contractors, schools and other
community institutions, such as the fire department – entities that may have possessed
training and expertise in the use of loaders and other construction equipment.
3
As is evident from the facts in Scarangella, that an employer may control a workplace
does not necessarily ensure that a product is being used safely and as contemplated at the
time of purchase. In lieu of the back-up alarm, the employer directed bus drivers to sound
the horn when backing up but there was no evidence that the driver followed that directive
and plaintiff testified that she did not hear a horn. Obviously, in that case the employer did
not succeed at managing the risk – yet the manufacturer received the benefit of the
exception.
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We are also unpersuaded that the Scarangella exception was categorically
unavailable to Bobcat here because “the person making the purchasing decision on
Taylor’s behalf was not at risk of personal harm through use of the loader without the
optional safety device” (150 AD3d at 156). There is no “risk of personal harm”
requirement in Scarangella. It is not unusual for a purchaser to obtain a product
contemplating its use by someone else – an employee, co-worker, partner, family member
or, as in this case, customer. The fact that the end user may not be the purchaser is also
not disqualifying under Scarangella. In fact, in that case the purchasing decision was made
-- not by an employee who worked in the bus yard -- but by the president and chief
operating officer of the bus company, which owned and operated 190 school buses and had
300 employees.
The Scarangella purchaser undoubtedly took the safety of his employees into account
when he made the “considered decision” not to purchase the back-up alarm. We are
unwilling to presume, as a matter of law, that a purchaser such as Taylor would not have a
comparable interest in the well-being of its retail rental customers. Moreover, unlike the
bus company, which was shielded from direct liability for employee injury by the Workers’
Compensation Law, Taylor could be – and in fact was – held liable for Fasolas’ injuries
and, thus, had and retains a pecuniary interest in ensuring the safety of the products rented
to its customers. Scarangella’s 3-prong test – faithfully applied – already requires
assessment of the purchaser’s basis of knowledge concerning the scope of the intended
uses of the product and its ability to weigh the risks and benefits of available optional safety
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devices. There is no need to engraft a “rental market” exemption, nor does our rejection
of that approach expand the Scarangella defense.
The misplaced focus on the fact that plaintiff acquired access to the loader through
the rental process was not confined to the Scarangella issue. The trial court’s product
liability charge incorporated the same rental market theory underlying the creation of a
blanket exemption from Scarangella and, thus, imparted an improper standard to the jury.
Under the pattern jury instructions, which are derived from our governing precedent, the
focus of the jury’s inquiry as to whether a product is defective is whether “it is not
reasonably safe” “for its intended or reasonably foreseeable purpose” (PJI 2:120, citing
Voss, supra). A product is “not reasonably safe” if it “is so likely to be harmful to [persons]
that a reasonable person who had actual knowledge of its potential for producing injury
would conclude that it should not have been marketed in that condition” (id.). In
determining whether the product should have been marketed in that condition, the pattern
charge instructs the jury to balance “the risks involved in using the product against (1) the
product’s usefulness and its costs, and (2) the risks, usefulness and costs of the alternative
design as compared to the product the defendant did market” (id.). The nature of the market
transaction that placed the product in the end-user’s hands – whether the product was
purchased or rented – is not part of this calculus.
The uncontested trial testimony was that the intended uses of the loader with bucket
attachment were to dig or move soil and other loose debris. Bobcat offered evidence that,
in this configuration and for this purpose, the loader was safe without the door kit and that
the door kit was designed for use with other attachments not purchased by Taylor.
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However, by charging the jury that it should consider whether the loader was safe without
the door kit for use “in the rental market” – rather than safe for its intended and reasonably
foreseeable uses – the court put its imprimatur on the expert’s rental market theory. Rather
than considering Bobcat’s evidence that the loader with the bucket attachment was safe for
its intended use without the door kit, the jury was led to believe that the manufacturer had
some higher, undefined duty when the product came into the end-user’s possession in the
course of a rental transaction. Indeed, the modified jury charge here improperly suggested
that, when placed in the “rental market,” the Bobcat loader had to be reasonably safe for
“whatever use” a renter might make of it. Thus, the charge impermissibly expanded the
universe of circumstances where the jury could have found the Bobcat product to be
defective.
Plaintiff’s expert conceded that the rental market theory he advanced would
effectively require a manufacturer to include every optional safety device as a standard
feature for every piece of equipment it knows is destined for the rental market. As a
practical matter, this theory would be unworkable with respect to many products, including
this one. The undisputed proof at trial indicated that the loader had 150 attachments that
served different purposes and included various safety devices, depending on their function.
Under the expert’s theory, every safety device available for every attachment would need
to accompany every loader entering the rental market. This would significantly raise the
cost of the product – perhaps making it prohibitively expensive and, thus, essentially
inaccessible to the occasional user that had neither the means nor the desire to purchase a
loader. Because the court’s jury instructions on defective design erroneously incorporated
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the rental market theory as a standard for the manufacturer to meet, Bobcat is entitled to
reversal and a new trial on this basis alone.
Having deemed Scarangella to be wholly inapplicable, neither the trial court nor the
Appellate Division examined whether Bobcat raised a triable question of fact warranting a
Scarangella charge. Because Bobcat is entitled, in any event, to a new trial on the design
defect claim due to the error in the strict products liability instruction, we have no occasion
to do so either. For purposes of resolution of this appeal, it is sufficient to observe as a
matter of law, based on the evidence presented at this trial, that Bobcat was not entitled to
a directed verdict in its favor on the Scarangella exception. Whether a Scarangella
instruction will be appropriate on retrial is a matter for the trial court to determine based
on the evidence presented at that time. Bobcat’s evidentiary argument is academic.
Accordingly, the order of the Appellate Division, insofar as appealed from, should
be reversed, with costs, and the motion of defendants Bobcat of Long Island, Inc. and
Bobcat Company for a new trial granted.
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Fasolas v Bobcat of New York
No. 29
RIVERA, J. (dissenting):
In this appeal, we must determine whether the exception to strict products liability
recognized in Scarangella v Thomas Built Buses (93 NY2d 655 [1999]) applies to a
manufacturer that sells its product to a rental company, which in turn rents it to an
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individual who suffers injuries that were allegedly caused by the manufacturer’s failure to
install as standard an optional safety device. The majority’s expansion of Scarangella to
absolve a manufacturer of liability, if the renting company has information about the
product and the optional safety equipment that has not been provided to the renter, runs
counter to our products liability public policy goals and the instrumentalist rationale of
Scarangella.
Contrary to the majority view, under New York’s established tort law doctrine and
product liability rules for design defect claims, the manufacturer could not avoid its
nondelegable duty to produce a safe product based solely on information about the product
known to a rental company. Instead, “departure from the accepted rationale imposing strict
liability upon the manufacturer” (id., 93 NY2d at 661) was justified only when the ultimate
user, or another party in the chain of distribution with control over the use environment,
was sufficiently knowledgeable about the product and the optional safety device’s
availability to conduct an adequate multifactor risk-utility analysis (id.; Voss v Black &
Decker Mfg. Co., 59 NY2d 102, 109 [1983]).
Here, the evidence did not establish that the person in the best position to balance
the risk and benefits of the product’s use without the safety device—the renter—had such
knowledge, or that the manufacturer took steps when entering the rental equipment market
to ensure the renter would receive the information necessary to engage in a risk utility
analysis, even if the manufacturer did not have direct access to the renter. Therefore, the
question of the manufacturer’s strict liability, based on its introduction into the rental
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market of its machinery without the safety device, was properly submitted and charged to
the jury. A new trial is not warranted, and I would affirm the order of the Appellate
Division.
I.
Manufacturer Products Liability for Design Defects
Before turning to the application of strict liability for a defectively designed product
introduced to the ultimate user through a rental market distribution chain, it is important to
review, in broad strokes, the development of products liability theory. Generally, this area
of law has developed in response to the shortcomings of other legal rules in addressing the
costs of injuries caused by changes in the market (Guido Calabresi, A Broader View of the
Cathedral: The Significance of the Liability Rule, Correcting a Misapprehension, 77 Law
& Contemp Probs 1 [2014]). Its analytical tenets are grounded in social policy concerns
and instrumentalist goals (see Michael L. Rustad, Twenty-First-Century Tort Theories: The
Internalist/Externalist Debate, 88 Ind LJ 419 [2013]).
A. Strict Liability for Product Injuries
“In many ways, the birth of modern products liability in the United States can be
traced to Judge Cardozo’s 1916 majority opinion [] in MacPherson v Buick Motor Co.”
(Daniel W. Leebron, An Introduction to Products Liability: Origins, Issues and Trends,
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1990 Ann Surv Am L 395, 396 [1991]).1 Judge Cardozo rejected the traditional privity-
based liability for negligence that depended on a contractual duty to the purchaser of a
product, because “[if] the nature of a thing is such that it is reasonably certain to place life
and limb in peril when negligently made, it is then a thing of danger” (MacPherson v Buick
Motor Co., 217 NY 382, 389 [1916]). This analysis excised privity as “the principal bar to
recovery for persons injured by products” (Product Liability § 1.01). In the century since
the MacPherson decision, other jurisdictions have adopted and expanded upon the
exception to privity (see e.g. Coakley v Prentiss-Wabers Stove Co., 195 NW 388, 392 [Wis
1923] [collecting cases in other jurisdictions];William J. Prosser, The Assault Upon the
Citadel (Strict Liability to the Consumer), 69 Yale L J 1099, 1101–1102 [1960]).2 The
Restatement of Torts adopted strict liability in 1965 (Restatement [Second] of Torts §
402A), state legislatures enacted product liability statutes, and the jurisprudence continued
1
As one commentator has noted, the groundwork for MacPherson and the national
movement leading to “[t]he erosion of the barrier of privity in negligence actions began in
1852 when the New York State Court of Appeals held [in Thomas v Winchester, 6 NY 397
(1852)] that a seller could be held liable to third persons not in privity with the seller for
the seller’s negligence in the manufacture or sale of products ‘imminently’ or ‘inherently’
dangerous to the ultimate user….By the early 1900’s, liability was imposed without privity
in a few cases involving products that were not in themselves inherently dangerous, but
which became so when defectively manufactured” (John S. Allee, Theodore V.H. Mayer,
Robb W. Patryk, Product Liability § 1.02 [Law Journal Press 2018]).
2
Res ipsa loquitur was heavily relied upon during the evolution of this area of torts law
(see e.g. Escola v Coca Cola Bottling Co. of Fresno, 24 Cal2d 453, 461 [1944] [Traynor,
J., concurring] [concurring in the judgment but stating that strict liability, not res ipsa
loquitur, should be the applicable standard, relying on the articulation of the rule in
MacPherson]; see generally Matthew R. Johnson, Note, Rolling the “Barrel” a Little
Further: Allowing Res Ipsa Loquitur to Assist in Proving Strict Liability in Tort
Manufacturing Defects, 38 Wm & Mary L Rev 1197 [1997]).
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to develop.3 Courts drew from contracts, theories of warranty, as well as tort in adopting
standards for products liability. As noted by the Restatement (Third) of Torts for Products
Liability, “‘strict products liability’ is a term of art that reflects the judgment that products
liability is a discrete area of tort law which borrows from both negligence and warranty. It
is not congruent with classical tort or contract law” (Restatement [Third] of Torts: Prods
Liab § 1, Comment a). The law expanded to permit claims for failure to warn, instruct,
inspect or test, and for manufacturing and design defects.
As the law developed to recognize strict liability for a manufacturer’s defective
design, jurisdictions differed on their approaches for holding a manufacturer liable (see
generally Kyle Graham, Strict Products Liability at 50: Four Histories, 98 Marq L Rev 555
[2014]; Dominick Vetri, Order Out of Chaos: Products Liability Design-Defect Law, 43 U
Rich L Rev 1373 [2009]; David G. Owen, Design Defects, 73 Mo L Rev 291 [2008]).
Current law reflects jurisdictional variations on the same theme: the manufacturer is liable
for a defect in the design of its product that is the proximate cause of a plaintiff’s injury.
Examples of product recalls and extensive litigation that have received national attention
over the years easily come to mind—phones unexpectedly catching fire, car ignition switch
3
For a comprehensive discussion of the development of products liability, including strict
liability for design defects, see David W. Leebron, An Introduction to Products Liability:
Origins, Issues and Trends, 1990 Ann Surv Am L 395 (1991).
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flaws, drugs substantially increasing the risk of heart attack and death—and easily illustrate
the interest in addressing the harms caused by unsafe products.4
The main features of products liability are straightforward: it relieves the plaintiff
from establishing that the manufacturer acted negligently in designing the product and
generally does not permit shifting preventable risks to consumers (Voss, 59 NY2d at 107
[“Liability attaches when the product, as designed, presents an unreasonable risk of harm
to the user”]). The Restatement (Third) of Torts: Products Liability rejected “the ‘consumer
expectations test’ as the governing standard for defining product defect” (Prods Liab § 8,
Comment b), and instead adopted a foreseeability test. Thus, a product “is defective in
design when the foreseeable risks of harm posed by the product could have been reduced
or avoided by the adoption of a reasonable alternative design by the seller or other
distributor, or a predecessor in the commercial chain of distribution, and the omission of
the alternative design renders the product not reasonably safe” (Restatement [Third] of
Torts: Prods Liab § 2[b]).5 This Restatement also rejected the patent danger rule—which
had been adopted by various jurisdictions—meaning manufacturers have a duty to
4
Paul Mozur, Galaxy Note 7 Fires Caused by Battery and Design Flaws, Samsung Says,
NY Times, Jan 13, 2017, at B1; Bill Vlasic & Rebecca R. Ruiz, Agency Expects More
Deaths from G.M.’s Ignition Flaw, NY Times, May 24, 2014, at B3; Alex Berenson, Merck
Agrees to Settle Vioxx Suits for $4.85 Billion, NY Times, Nov 9, 2007 at A1.
5
To the extent the majority focuses on the fact that Bobcat offered evidence that the loader
was safe without the door kit “for [the specific] purpose of mov[ing] soil,” (majority op at
12, 14), the majority ignores our settled law that “[a] manufacturer who sells a product in
a defective condition is liable for injury which results to another when the product is used
for its intended purpose or for an unintended but reasonably foreseeable purpose” (Lugo
by Lopez v LJN Toys, Ltd., 75 NY2d 850, 852 [1990] [emphasis added]).
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eliminate obvious risks when they can do so by cost-effective design changes (Restatement
[Third] of Torts: Prods Liab § 2, Comment d). This reflects the Third Restatement’s view
that liability for design defects is “predicated on a different concept of responsibility” than,
for example, manufacturing defects because design defects are by definition based on “the
manufacturer’s own design specifications” (Restatement [Third] of Torts: Prods Liab § 2,
Comment a). Accordingly, “various trade-offs need to be considered in determining
whether accident costs are more fairly and efficiently borne by accident victims, on the one
hand, or on the other hand, by consumers generally through the mechanism of higher
product prices attributable to liability costs imposed by courts on product sellers” (id.).
This devolves to whether the manufacturer has made the choice society is willing to accept
as to the balance between the risks of the product as designed and the benefits it provides.
Strict liability is justified by public policies that seek to reduce injuries while
acknowledging the benefits of inventions and product development (see Codling v Paglia,
32 NY2d 330, 341 [1973]; Calabresi, A Broader View of the Cathedral, 77 Law &
Contemp Probs 1 [discussing the liability rules in tort “as an essential part of the social
structure and of the law” and the fundamental public function of tort]). Courts attempt to
achieve social goals by adopting standards of strict liability that accomplish any or a
combination of the following outcomes: (1) entrepreneurial liability, meaning accident
costs are included in the cost of doing business; (2) risk-spreading by manufacturers
because they are in a better position “to absorb and allocate risk of injury through price
increases, insurance, etc., than those who suffer illness and disability from defective
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products” (Prod Liab § 1.04[1]); (3) compensation of innocent victims; (4) deterring the
production of unsafe products, and improving product quality; (5) the party that introduces
the product into the market bears the costs of injury rather than the customer who is
powerless to protect against defective products; and (6) risk control, to ensure liability is
placed on the entity “in the best position to understand the nature and the extent of the risk
and to control that risk” (Prod Liab § 1.04[1][g]).
B. Manufacturer Design Defect Strict Liability under New York Law
Our Court has set forth clear rules in this area of law: “[w]here a plaintiff is injured
as a result of a defectively designed product, the product manufacturer or others in the
chain of distribution may be held strictly liable for those injuries” (Hoover v New Holland
N. Am. Inc., 23 NY3d 41, 53 [2014]). Accordingly, “the manufacturer is under a
nondelegable duty to design and produce a product that is not defective” (Robinson v Reed-
Prentice Div. of Package Machinery Co., 49 NY2d 471, 479 [1980]).
“[A] defectively designed product is one which, at the time it leaves the seller’s
hands, is in a condition not reasonably contemplated by the ultimate consumer and is
unreasonably dangerous for its intended use; that is one whose utility does not outweigh
the danger inherent in its introduction into the stream of commerce” (id.). The Court has
also explained that “[s]trict products liability for design defect…differs from a cause of
action for a negligently designed product in that the plaintiff is not required to prove that
the manufacturer acted unreasonably in designing the product. The focus shifts from the
conduct of the manufacturer to whether the product, as designed, was not reasonably safe”
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(Voss, 59 NY2d at 107). A manufacturer is strictly liable for a design defect because
“regardless of [the manufacturer’s] lack of actual knowledge of the condition of the product
[the manufacturer] is in the superior position to discover any design defects and alter the
design before making the product available to the public. Liability attaches when the
product, as designed, presents an unreasonable risk of harm to the user” (id.; see also
Codling, 32 NY2d at 340 [“In today’s world, it is often only the manufacturer who can
fairly be said to know and to understand when an article is suitably designed and safely
made for its intended purpose”]). “[I]n the products liability cases, rather than arising out
of the ‘will or intention of the parties,’ the liability imposed on the manufacturer is
predicated largely on considerations of sound social policy, including consumer reliance,
marketing responsibility and the reasonableness of imposing loss redistribution” (Milau
Associates v North Ave. Development Corp., 42 NY2d 482, 498 [1977] [internal citations
and alternation omitted]), in addition to the social policies already set forth above. Thus, a
manufacturer is strictly liable for injuries proximately caused by a design defect in its
product (id.).
In Voss, the Court identified seven nonexclusive factors to be considered in
balancing the risks created by the product’s design against its utility and cost, including:
“(1) the utility of the product to the public as a whole and to the individual user; (2) the
nature of the product—that is, the likelihood that it will cause injury; (3) the availability of
a safer design; (4) the potential for designing and manufacturing the product so that it is
safer but remains functional and reasonably priced; (5) the ability of the plaintiff to have
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avoided injury by careful use of the product; (6) the degree of awareness of the potential
danger of the product which reasonably can be attributed to the plaintiff; and (7) the
manufacturer’s ability to spread any cost related to improving the safety of the design” (id.
at 109). The requisite
“analysis is rooted in a recognition that there are both risks and benefits
associated with many products and that there are instances in which a
product’s inherent dangers cannot be eliminated without simultaneously
compromising or completely nullifying its benefits. In such circumstances, a
weighing of the product’s benefits against its risks is an appropriate and
necessary component of the liability assessment under the policy-based
principles associated with tort law” (Denny v Ford Motor Co., 87 NY2d 248,
257 [1995] [internal citation omitted]).
Similar to the view of the Third Restatement, the Court has acknowledged that unlike
manufacturing defects, “[i]n design defect cases, the alleged product flaw arises from an
intentional decision by the manufacturer to configure the product in a particular way” (id.
at 257, n 3). The Court has thus recognized that this risk-utility analysis is “closer to that
used in traditional negligence cases, where the reasonableness of an actor’s conduct is
considered in light of a number of situation and policy-driven factors” (id. at 267;
Restatement [Third] of Torts: Prods Liab § 1, Comment a).
In Scarangella v Thomas Built Buses, this Court recognized an exception to a
manufacturer’s strict liability for a design defect and shifted the manufacturer’s
responsibility for the risk-utility analysis to a buyer with superior knowledge about the
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risks and benefits of the buyer’s contemplated use without the optional safety device. 6 “In
an effort to lend predictability to litigation of this kind,” (Passante v Agway, 12 NY3d 372,
384 [2009]), the Court identified “some governing principles for cases where a plaintiff
claims that a product without an optional safety feature is defectively designed because the
equipment was not standard” (Scarangella, 93 NY2d at 661).
“The product is not defective where the evidence and reasonable inferences
therefrom show that: (1) the buyer is thoroughly knowledgeable regarding
the product and its use and is actually aware that the safety feature is
available; (2) there exist normal circumstances of use in which the product is
not unreasonably dangerous without the optional equipment; and (3) the
buyer is in a position, given the range of uses of the product, to balance the
benefits and the risks of not having the safety device in the specifically
contemplated circumstances of the buyer’s use of the product. In such a case,
the buyer, not the manufacturer, is in the superior position to make the risk-
utility assessment, and a well-considered decision by the buyer to dispense
with the optional safety equipment will excuse the manufacturer from
liability. When the factors are not present, there is no justification for
departure from the accepted rationale imposing strict liability upon the
manufacturer because it ‘is in a superior position to discover any design
defects’” (Scarangella, 93 NY2d at 661, quoting Voss, 463 NY2d at 107).
Our Court has since clarified that “[u]nder Scarangella, the second question is not
whether equipment ‘would normally be used’ without unreasonable danger; it is whether
‘there exist normal circumstances of use’ where the danger is not unreasonable. In other
words, if there exist buyers who use the product normally and can forgo the safety feature
6
Scarangella recognized a limited exception to our products liability rules that applies
solely to a manufacturer’s optional safety device, and not to any possible “accessory,” as
suggested by the majority (majority op at 10).
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without unreasonable risk, the judgment as to which buyers ought to do so is left to the
buyers themselves” (Passante, 12 NY3d at 385).
In those cases where a defendant manufacturer argues that the exception applies, the
trial court conducts an analysis in accordance with the principles set forth in Scarangella
to determine whether the plaintiff made a prima facie showing that the manufacturer’s
failure to install the optional safety device is a design defect, so as to present a triable issue
of fact for the jury on that question. If the court concludes the plaintiff has met this
threshold burden, the jury is charged with determining “if a reasonable person who knows
or should have known of the product’s potential for causing injury and of the feasible
alternative design[s] would have concluded that the product should not have been marketed
in that condition” (PJI 2:120; Voss, 59 NY2d at 108-109). In reaching its verdict, the jury
must “balance[e] the risks inherent in the product, as designed, against its utility and cost,”
weighing such relevant factors as those recognized in Voss (see Voss, 59 NY2d at 109).7
II.
Scarangella Applies Solely to Cases Where the Ultimate User or Purchaser
with Control Over the Use Environment Has Special Knowledge
7
To the extent the majority suggests that a plaintiff must produce expert testimony to prove
that Scarangella does not apply (majority op at 5), the law is to the contrary. Scarangella
does not require expert testimony by the plaintiff; instead, the court’s analysis is based on
the information about the product, the safety device, and the use environment – information
which is a defendant’s burden to bring forward to establish that the exception applies (see
Passante v Agway Consumer Products, Inc., 12 NY3d 372, 381 [2009] [defendants’ burden
to make a prima facie showing of entitlement to judgment as a matter of law on Scarangella
factors]).
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Defendant is a manufacturer who argues that the Scarangella exception to strict
products liability applies because the rental company to which it sold its injury-causing
product had knowledge about the machine and the available optional safety device to make
the requisite risk-utility analysis. This application of Scarangella—which shifts the
balancing of risks and benefits to a rental company that is neither the ultimate user nor has
control over the use environment—and now adopted by the majority—is inapt. The
exception recognized in Scarangella to strict liability applies when the party has adequate
information about the product and the optional safety device, along with superior
knowledge to that of the manufacturer of the circumstances of the particular use. In a case
involving the rental market, that party is the renter, not the rental company.8
A. The Underlying Litigation
Sofia Fasolas, as administrator of Elias Fasolas’s estate, commenced this wrongful
death action, alleging strict liability for defective design and manufacture, negligence,
breach of express and implied warranties, and failure to warn. As established at trial, Elias
Fasolas rented a Bobcat S 175 skid-steer loader with a bucket attachment from defendant-
8
No party requests that we revisit Scarangella’s underlying presumptions or ultimate
holding to absolve a manufacturer of strict liability based on a purchaser’s knowledge of
the product’s risks and uses. Given that the parties do not challenge the framework adopted
in that case, I have no occasion to opine on the soundness of the Scarangella approach to
products liability as a general matter, nor the more discrete question whether application
of Scarangella to an employer—a party typically free of tort liability under Worker’s
Compensation laws—should be reconsidered (see James A. Henderson Jr. & Aaron D.
Twerski, Optional Safety Devices: Delegating Product Design Responsibility to the
Market, 45 Ariz St LJ 1399, 1410 [2013]).
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respondent Port Jefferson Rental Center, Inc., d/b/a Taylor Rental Center (Taylor). Taylor
purchased the loader from defendant Bobcat Long Island, Inc. (Bobcat LI), the distributor
for manufacturer defendant Bobcat Company (Bobcat). Taylor rents various products,
including Bobcat machinery, to the general public.
For over 50 years, Bobcat has built “compact equipment” and leads the industry in
the design, manufacture, marketing, and distribution of this equipment for construction,
rental, landscaping, agriculture, grounds maintenance, government, utility, industry, and
mining.9 Bobcat’s brochure at the time of the incident asserted that its skid loaders set the
standard for design, productivity, and comfort and that the loaders were “state of the art.”
The loader is a piece of machinery that could be outfitted with up to 150 different
attachments to allow it to be used for numerous landscaping-type tasks. Among those
attachments are the “bucket attachment”—either with or without “teeth”—that could be
used to move and pick up dirt, broken branches, downed trees, and debris. A bucket with
teeth can dig and loosen up packed soil. Bobcat also manufactured an optional special
applications kit which could be purchased for installation on the loader. As relevant here,
the kit included a thick plastic front door for the operator cab—what the parties refer to as
the optional safety device. The Bobcat defendants presented evidence at trial that it
recommended installation of the door when the loader was used with attachments that
9
Bobcat, “Overview,” https://www.bobcat.com/company-info/about/overview (last
visited April 10, 2019). According to Bobcat’s website, its brand has “earned the nickname
‘One Tough Animal.’”
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created the risk of flying debris—such as the drilling attachment. The door was not
recommended when the loader was used to move and level soil because it would obstruct
the user’s visibility and make it more difficult to escape the cab. It is undisputed that Taylor
purchased at least eight loaders over the course of five years but did not purchase the kits
or have the doors installed on the loaders.
Elias rented the loader without the door from Taylor for personal use, to clear land
on his family’s property. He died while operating the loader when a small tree entered the
open front section of the cab and pushed him back, pinning him against the back wall and
ceiling of the cab. While the tree did not enter his body, he was pushed up and crushed to
death by the tree. The tree pushed Elias off the controls (which are hand controlled) and
unable to reach them, Elias could not move the loader to back it off the tree. The end of the
tree remained rooted in the ground. There was evidence that Elias likely suffered pain and
terror for approximately five to ten minutes as he died. Plaintiff claimed that the loader
without the door was a design defect that proximately caused Elias’s death. Plaintiff’s
expert testified that, given the product was entering the rental market, it was defectively
designed to not have the thick plastic door as a standard feature.
The testimony of both Taylor employees was consistent with their having learned
of the availability and purpose of the kit and the door specifically only after Elias’s
accident. Although a Bobcat LI employee would go through a checklist with a Taylor
employee upon delivery of a loader, the checklist had 20 different items on it and did not
mention the door by name. Bobcat’s brochure mentioned the availability of the “special
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applications kit,” which apparently included the door, but did not contain specific language
about the door or its purpose.
Supreme Court denied the Bobcat defendants’ request for a jury charge on the
Scarangella exception and charged the jury on whether the product was defectively
designed for use in the rental market. The jury returned a verdict in favor of plaintiff, and,
as relevant here, apportioned each Bobcat defendant twenty-five percent liability on a
defective design theory. Supreme Court denied defendants’ pre- and post-verdict motions
seeking to avoid liability, concluding that Scarangella was “not applicable” because Taylor
was not the ultimate user. The Appellate Division affirmed, holding the Scarangella
exception inapplicable because the manufacturer sold to a rental company knowing that
the company would rent to persons over whom it had no control and who might lack
expertise in operating the equipment (150 AD3d 147 [2017]).
B. A Manufacturer Remains Strictly Liable for Design Defects When It Enters the
Product Rental Market
The majority adopts the view, advocated here, that the exception recognized in
Scarangella applies to absolve the manufacturer of strict liability for a design defect when
it sells its product to a rental company that has knowledge about the product and the
manufacturer’s optional safety device (majority op at 2, 12). The majority’s analysis
mischaracterizes the relevant question as “whether the exception is categorically
unavailable when the allegedly defective product came into the injured end user’s hands
through the rental market, rather than by a purchase transaction” (majority op at 2, 10). The
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question is not whether the end user rented or purchased the product, but whether the end
user has the type of knowledge necessary to make the risk-benefit analysis that traditionally
falls to the manufacturer. The majority’s rejection of a “‘rental market’ exclusion from
Scarangella (majority op at 2) is an answer in search of a problem. It is already the case
that a rental company is subject to claims for liability for its role in the distribution chain
of an allegedly defectively designed product (Restatement [Third] of Torts: Prods Liab §
20 [b] [“Commercial nonsale product distributors include, but are not limited to, lessors,
bailors, and those who provide products to others as a means of promoting either the use
of consumption of such products or other commercial activity”]). The real issue is whether
the manufacturer may escape strict liability by choosing to distribute its product through a
third-party rental company. Our cases, including Scarangella, do not mandate absolution
where the information available to the buyer fails to place the buyer in the position of “a
highly knowledgeable consumer” (Scarangella, 93 NY2d at 661).10
10
The majority’s contention that holding a manufacturer strictly liable for design defects
when the manufacturer sells to a rental agency is “unworkable” (majority op at 15) reflects
a misunderstanding of the plaintiff’s theory and the facts in the appeal before us, as well as
basic products liability doctrine. The majority claims that because the loader had 150
attachments that served different purposes “every safety device available for every
attachment would need to accompany every loader entering the rental market” (id.). There
was no testimony at trial suggesting any other potential safety devices – rather a single
safety device (the door) that was already recommended by Bobcat for multiple iterations
of the product. Additionally, pointing out the complexity of the product and the many
considerations involved in analyzing the risk-utility tradeoff for each of 150 uses only
further suggests that the manufacturer of such a specialized product is typically in a far
better position to conduct such an analysis.
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The facts of Scarangella illustrate the point. The third-party defendant in that case
was a bus company that declined an optional back-up alarm for its fleet of buses. The
company had decades of information and experience about how school buses function, the
conditions under which the buses would be used without the optional back-up alarm device,
and knowledge about the risks to its bus driver employees if it did not use the back-up
alarm (id.). Although the defendant manufacturer did not sell to the end user (i.e., the bus
drivers), it sold to their employer—the party that instructed the drivers and wielded control
over the environment in which the product was used. Indeed, because of the bus company’s
unique experience, it had access to information about the product and the safety device and
the environment in which the buses would be moved. As a consequence of this base
knowledge, the company was able to weigh the risks of forgoing use of the back-up alarm.
The justifying premise of Scarangella— that “the buyer, not the manufacturer, is in
the superior position to make the risk-utility assessment, [such that] a well-considered
decision by the buyer to dispense with the optional safety equipment will excuse the
manufacturer”—has no application where the manufacturer relies on the rental company’s
knowledge alone. The rental company is not the end user and, unlike the bus company in
Scarangella, the rental company has no control over the environment in which the product
will be used.
It is the renter and not the rental company that is “in the best position to make the
cost-benefit analysis and act upon it” (Guido Calabresi & Jon T. Hirschoff, Toward a Test
for Strict Liability, 81 Yale L J 1055, 1063 [1972]). Indeed, because the rental company
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has no control over how the product will actually be used, the only way a rental company
can assure that it does not run afoul of the majority’s interpretation of Scarangella is to
purchase all the optional safety equipment, or not rent the machinery at all. The former
essentially makes the optional device standard for rental purposes; the latter removes from
the market a multipurpose product with various beneficial uses that in certain
circumstances is not unreasonably dangerous without the safety device. Neither outcome
furthers the public policy goals of risk control, allocative efficiency, 11 and consumer
autonomy that justify our state’s products liability rules.
The majority contends that whether the purchaser “exercises control over the
product’s use in its capacity as an employer or otherwise is a consideration that is relevant
to a determination of the buyer’s relative ‘position’ to engage in the proper balancing
inquiry—but it is not dispositive” (majority op at 12). The majority argues that the facts of
Scarangella demonstrated that the employer was not able to sufficiently control the
workplace to ensure the product’s safe use. However, the question is not whether the buyer
succeeded in making the environment accident-proof. The question is whether at the time
of purchase the buyer was in a better position than the manufacturer to properly balance
the product’s utility and risks without the optional safety device. Scarangella recognized
that a manufacturer was not liable in those rare cases where the purchaser was sufficiently
11
Allocative efficiency is an economics theory of tort law which focuses on the optimal
distribution of goods and services, taking into account consumer preferences. When the
output of production is as close as possible to the marginal cost the market has achieved
allocative efficiency.
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knowledgeable and motivated to make that determination. Central to the analysis was our
Court’s recognition that the persons at risk from the decision not to purchase the optional
safety device were the buyer and “almost exclusively” those within the buyer’s employ
who were specifically instructed and required to use the product in a certain manner as part
of their employment (Scarangella, 93 NY2d at 662). The scenario presented here is akin to
a leasing arrangement, which generally does not absolve a manufacturer of strict liability
for a design defect merely by selling the product to a lessor. Rather, both may be liable,
and a commercial lessor of a particular product can be strictly liable, just like the
manufacturer (see Michael Weinberger, New York Products Liability, 2d § 5:7 [Thomson
Reuter 2019]; Assam v Deer Park Spring Water, Inc., 163 FRD 400, 405 [EDNY 1995]
[applying New York law]; Winckel v Atlantic Rentals & Sales, Inc., 159 AD2d 124 [2d
Dept 1990]; Buley v Beacon Tex-Print Ltd., 118 AD2d 630, 631 [2d Dept 1986]; Natasi v
Hochman, 58 AD2d 564 [1st Dept 1977]). New York and “[m]ost jurisdictions that have
adopted the doctrine of strict liability in products liability have also, when faced with the
question, applied the doctrine to commercial lessors or bailors or products, or to lease
transactions which are commercial in nature and are not isolated cases” (Am L Prod Liab
3d § 36:19; see also Restatement [Third] of Torts: Prods Liab § 1, Comment b [“The rule
stated in this Section applies not only to sales transactions but also to other forms of
commercial product distribution that are the functional equivalent of product sales”];
Restatement [Third] of Torts: Prods Liab § 20[b] [“Commercial nonsale product
distributors include, but are not limited to, lessors, bailors, and those who provide products
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as a means of promoting either the use or consumption of such products or some other
commercial activity”]).12
III.
Additional Policy Concerns
Several policy concerns further inform and confirm this analysis, as viewed through
the lens of our approach to strict liability for defectively designed products (illustrated by
the Voss line of cases) and this Court’s cabining of manufacturer liability in optional safety
equipment cases in accordance with the principles set forth in Scarangella. These policy
matters provide useful insight for the future development of New York’s strict liability law
now that the majority has sanctioned the reallocation of the burdens of risks and uncertainty
from manufacturer to nonuser purchaser.
First, the question of who is best positioned to control risk is made more difficult
when the product has multiple uses, some of which are not intended to be used with the
optional safety device. In these cases, the purchaser knows what function the product will
be performing and dictates a particular use. As such, the argument goes, as between the
manufacturer and the purchaser, the purchaser is in a better position to control the risks. To
be contrasted are single-purpose products, in which case the manufacturer knows how the
12
The majority’s assertion (majority op at 11) that no other court has reached the
conclusion that Scarangella has no application where the product is sold to a rental
company is of no moment, and a transparent attempt to bolster its flawed analysis. The fact
is no published opinion other than the Appellate Division decision here has addressed the
issue and the majority can point to none.
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product is intended to be used and the risks that arise from that specific use. The
manufacturer is therefore the party in the best position to know the product’s dangers and
avoid or account for accident costs. Application of Scarangella to a rental company,
however, only further confuses the analysis as the company is neither the user nor the party
that may dictate the renter’s actual use.
Second, and relatedly, the Scarangella approach depends on the purchaser having
the capacity to process and make informed decisions based on information about the safety
device, the purchaser’s particularized knowledge about the use environment and the
purchaser’s assessment of the risks of use without the safety device and the purchaser’s
ability to avoid that risk (93 NY2d at 661). Tests that depend on purchaser knowledge have
been criticized as failing to contend with the unsophisticated customer (see Henderson &
Twerski, 45 Ariz St LJ 1399). Applying these same concerns to the rental market, where
the customer base includes occasional or one-time renters with a limited foundational
knowledge about the product and its uses, it is unrealistic to assume the renter, by mere
fact of having access to certain information, will adequately process the rental company’s
explanation of the purpose of the optional safety device, and then engage in a multifactor
risk-utility assessment. We need only consider the weekend do-it-yourself gardener or
home-owner who rents a machine at the local store and after a five-minute explanation on
how to use it, is assumed to have the same understanding and skills to deploy the machine
as skilled contractors and those who regularly work with machinery. How is that
inexperienced person going to make an analysis that has traditionally been placed on the
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manufacturer? How are they to consider whether they can avoid the risk? (Biss v Tenneco,
64 AD2d 204, 207 [4th Dept 1978] [manufacturer not liable because purchaser was “the
party in the best position to exercise an intelligent judgment to make the trade-off between
cost and function, and it is (the purchaser) who should bear the responsibility if the decision
on optional safety equipment presents an unreasonable risk to users”]). This may appear
simple enough when the user is assessing a common product, with a low risk of injury, but
construction machinery is a far cry from a blender.
Third, treating the rental company as the buyer for Scarangella purposes still
requires that the manufacturer provide information about the product and the optional
safety equipment, but only to the rental company. This is not good public policy. Rather
than abandon the manufacturer strict liability rule, we should retain the liability framework
that holds liable every party in the distribution chain. Under that framework, the
manufacturer is free to impose a contractual obligation on the rental company to include
provision of the type of information necessary for a renter to make an adequate risk-utility
analysis. Indeed, in the leasehold context, New York courts have noted that the lease and
the user’s guide provided by the lessor could include just such information (Cordani v
Thompson & Johnson Equip. Co., 16 AD3d 1002, 1003–1007 [3d Dept 2005]; Patane v
Thompson & Johnson Equip. Co., 233 AD2d 905 [4th Dept 1996]).
Fourth, the majority’s approach ignores the fact that the manufacturer chose to enter
a market whereby it makes what amounts to an indirect sale. Indeed, the majority’s decision
to permit the manufacturer to delegate to the rental company the manufacturer’s
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responsibility to the ultimate user advances no public policy. If the manufacturer injects
itself into this market but has no reasonable basis to know whether the end user is “a
knowledgeable consumer”—meaning the manufacturer has no way to be reasonably
certain that the renter is thoroughly knowledgeable about the product and the safety device,
and capable of balancing the benefits and risks of not using the safety device for the user’s
intended purpose—the manufacturer should not be relieved of its nondelegable
responsibility to provide the consumer with a safe product. This undermines an intended
goal of products liability: to reduce injury and all the economic harms that flow from them
by incentivizing manufacturers to design and produce products reasonably safe for their
intended use (Restatement [Third] of Torts: Prods Liab). The facts of this appeal are worthy
of note on this point. Bobcat knew that Taylor never purchased the optional safety device
even though the rental customer base was not exclusively experienced renters of
construction and landscaping machinery of the type at issue here. Yet, Bobcat regularly
introduced its products into this rental market for years and profited from that business
model. Under these circumstances it retained the duty to provide a product that was not
defective for the needs of that market.
Maintaining the responsibility and strict liability with the manufacturer keeps the
focus on safety in the hands of the party best positioned to make design and production
choices. Further, and as explained above, nothing prevents a manufacturer from entering a
contract agreement with the rental company to ensure that use of its product is adequately
explained to the end user so as to avoid injury through unsafe uses.
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IV.
Manufacturer Bobcat’s Strict Liability Was Properly Submitted to the Jury
For the reasons I have discussed, the underlying premise of Scarangella does not
apply to a rental company like Taylor as it lacks control over the product use and the use
environment. Therefore, the narrow exception to a manufacturer’s strict liability does not
bar a plaintiff’s design defect claim based solely on the rental company’s knowledge about
the product and the optional safety device. Here, Supreme Court did not err in denying
defendants’ CPLR 4404 motion to set aside the verdict on the ground that plaintiff failed
to establish a prima facie case of design defect because no evidence established that Elias
had superior knowledge to that of defendant Bobcat manufacturer that permitted him to
conduct an adequate risk-utility analysis.13
Nor is a new trial required based on the court’s failure to charge the jury on the
Scarangella factors. The majority is incorrect that the charge—a modified version of the
strict products liability Pattern Jury Instruction 2:120—was erroneous because it referred
to the rental market (majority op at 2, 8, 14-15) and wrongly suggests that the applicability
of Scarangella and the rental market charge were related (majority op at 15). A court is not
required to follow the Pattern Jury Instructions and should instruct the jury on “what the
13
Under the majority’s interpretation of Scarangella—meaning the exception applies to a
rental market, and that the factors set forth in that case apply to the buyer rental company,
not the renter—the Bobcat defendants failed to establish both that Taylor had superior
knowledge of the product and that it was actually aware of the safety device (the first
Scarangella factor). Thus, the question of defendants’ liability was for the jury to decide in
accordance with established manufacturer strict liability design defect doctrine.
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factual contentions of the parties are with respect to the legal principles charged” (Siegel,
NY Prac § 398, at 598 [2d ed]). Here, the court decided to charge the jury based on the
specific facts of the case, not based on any consideration that the Scarangella exception did
not apply. The fact that Elias rented the skid loader was undisputed and relevant to whether
under the circumstances of his acquisition of this machine—namely by renting the Bobcat
loader from Taylor—Elias was capable of balancing the risks and benefits. Plaintiff’s
theory of design defect, which the jury was free to reject, was that Bobcat actively pursued
the rental market, including encouraging its distributors to directly rent its loaders even
without a safety device, and as such, the product was defectively designed for Bobcat’s
foreseeable users. Accordingly, the trial court properly charged the jury, and because no
error is apparent warranting rejecting the jurors’ verdict that Bobcat was liable for a
defectively designed product that proximately caused Elias’s fatal injuries, the Appellate
Division should be affirmed.14
I dissent.
* * * * * * * * * * * * * * * * *
Order insofar as appealed from reversed, with costs, and motion of defendants Bobcat of
Long Island, Inc. and Bobcat Company for a new trial granted. Opinion by Chief Judge
DiFiore. Judges Stein, Fahey, Garcia, Wilson and Feinman concur. Judge Rivera dissents
and votes to affirm in an opinion.
Decided May 9, 2019
14
Defendants’ other arguments are without merit.
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