Imperial Aluminum-Scottsboro, LLC v. Taylor

295 So.3d 51

IMPERIAL ALUMINUM-SCOTTSBORO, LLC

v.Tyler D. TAYLOR

1171133

Supreme Court of Alabama.

September 20, 2019

Anthony N. Fox of Scott, Sullivan, Streetman & Fox, P.C., Birmingham, for appellant.

W. Lee Gresham III of Heninger Garrison Davis, LLC, Birmingham, for appellee.

STEWART, Justice.

This case requires us to consider whether a defendant engaged in third-party spoliation of evidence that would have been essential to the plaintiff's products-liability claim against a manufacturer. For the reasons stated below, we affirm the judgment entered by the Jackson Circuit Court ("the trial court") following a bench trial insofar as it found Imperial Aluminum-Scottsboro, LLC ("Imperial"), culpable for negligent spoliation of evidence and awarded compensatory damages to Tyler D. Taylor. We reverse the trial court's judgment insofar as it awarded punitive damages against Imperial based on a finding of wanton conduct.

Facts and Procedural History

On October 10, 2010, Taylor injured his right index finger while in the line and scope of employment with Imperial. In its judgment, the trial court provided a summary of the facts leading up to and relating to Taylor's injury:

"In early October of 2010, [Taylor] was hired by Imperial to paint some of the structures on its property; he was given a used paint sprayer with which to complete his task. After starting his task, [Taylor] realized that the used paint sprayer was malfunctioning, which he reported to Imperial. On October 5, 2010, Imperial purchased a new paint sprayer, a Tradeworks 170, from Sherwin-Williams. The new paint sprayer included the ‘spray gun’ component, which is used to distribute the paint, and the compressor, which compresses air and is used to send paint to the spray gun.

"After unboxing the paint sprayer, [Taylor] assembled the components and began painting Imperial's structures. On October 10, 2010, [Taylor] had finished his work for the day and was cleaning paint from the spray gun component, when the paint sprayer activated and injected paint and mineral spirits into his right index finger.

"[Taylor] was transported to Highlands Medical Center and underwent a series of painful procedures in an attempt to save his finger. Despite the best efforts of his physicians, they were unable to save his finger, and the decision was made by [Taylor] and his physicians to completely amputate his right index finger, all the way down to his hand.³ Subsequent to this amputation, [Taylor] had to undergo another procedure to remove a painful neuroma at the amputation site.

"[Taylor's] doctors have discussed with him the possibility that he may need to, at least, have carpal tunnel surgery, and [Taylor] is also at risk of developing arthritis and other degenerative conditions as a result of his injury.

"³ This type of amputation is called a ray resection."

(Citations to the record omitted.)

In preparation for potential litigation stemming from his injury, Taylor retained legal counsel.¹ On January 3, 2011, Taylor's attorney sent Imperial a letter stating:

"We represent [Taylor,] who was injured while working at your company on or about October 1 [sic], 2010.

"We understand that a paint gun was the cause of his injury, which resulted in the loss of his index finger. We anticipate making a claim for damages arising from this injury. In this regard, it will be necessary for us to inspect the paint gun and any equipment utilized with it at the time of the injury, along with any and all paperwork, documents, bill of sale, etc., pertaining to its purchase, manufacture and maintenance. Please preserve the gun along with any and all paperwork and do not allow anyone to change, modify, or destroy or otherwise dispose of the paint gun and other requested items."

The letter did not include an offer by Taylor to bear any cost or other burden of preserving the requested evidence.

In its judgment, the trial court summarized the efforts employees of Imperial took to preserve the Tradeworks 170 paint sprayer after receiving the January 3, 2011, letter:

"In response [to the letter], the general manager of Imperial's Scottsboro facility, Mike Peebles, instructed Randy Stalnaker to put the paint sprayer up. Imperial was aware, no later than its receipt of [the] January 3, 2011, letter, that [Taylor] intended to pursue a claim for damages arising out of [Taylor's] injury. Randy Stalnaker was the maintenance supervisor and/or manager at Imperial's Scottsboro location. Mr. Stalnaker instructed Amanda King to put the paint sprayer in the finished-goods portion of the warehouse and to cover it with a bag. After putting the paint sprayer up, Amanda King confirmed to Mr. Stalnaker that the ‘spray gun part’ of the paint sprayer was also preserved."

(Citations to the record omitted.)

On October 10, 2012, Taylor filed a complaint in the Madison Circuit Court asserting claims of products liability under the Alabama Extended Manufacturer's Liability Doctrine ("the AEMLD"), negligence, wantonness, failure to warn, and breach of warranty against Graco, Inc. ("Graco"), and Sherwin-Williams Scottsboro Store Number 2126 ("Sherwin-Williams"). Taylor also alleged in the complaint that Graco was the manufacturer of the Tradeworks 170 and that Imperial had purchased the unit from Sherwin-Williams. Although it is not clear from the record, the trial court's judgment indicates that Taylor's case against Graco and Sherwin-Williams was removed to the United States District Court for the Northern District of Alabama. On January 18, 2013, Imperial's attorney sent a letter to Taylor's attorney stating:

"I went to the Imperial Aluminum plant in Scottsboro, Alabama[,] to obtain the spray gun involved in this matter. I was advised at that time that immediately following this accident which occurred on October 10, 2010, they stopped using the spray guns of the type involved in the accident made the basis of this suit. According to the information I was able to obtain this occurred in December of 2010. Unfortunately, the spray gun was deposed [sic] of at or near that time and is no longer available."

On May 8, 2013, after receiving the letter from Imperial's counsel, Taylor dismissed his complaint against Graco and Sherwin-Williams.

On the same day, Taylor filed a complaint in the trial court naming as defendants Imperial, Mike Peebles, and various fictitiously named defendants and asserting a claim alleging third-party spoliation of evidence arising from Imperial's failure to preserve the spray-gun portion of the Tradeworks 170 unit. Taylor demanded a trial by a jury. Imperial filed an answer on June 10, 2013, in which it stated, in pertinent part:

"5. The Defendant, Imperial Aluminum-Scottsboro, LLC, would state that [Taylor], through his counsel of record, did not contacted [sic] it about preserving the ‘paint sprayer’ until January 3, 2011, which was not actually received until a later date.

"6. Prior to January 3, 2011 the ‘paint sprayer’ in question was disposed of as it was not longer in use at the plant."

The trial court conducted a bench trial on March 12, 2018, during which it received the testimony of Peebles, Taylor, Amanda King, and Mike Chenoweth, who was vice president of operations for Imperial and who had been designated as Imperial's corporate representative.² The deposition testimony of Randy Stalnaker, the maintenance supervisor at Imperial's Scottsboro facility, and of Taylor's treating physicians was read into the record. Chenoweth testified that he was aware of the January 3, 2011, letter from Taylor's attorney to Imperial in which Imperial was asked to preserve the spray gun, as well as other items related to the Tradeworks 170 unit. Chenoweth testified that, after Imperial received the letter, Imperial management instructed maintenance workers to preserve the unit. Under direct examination by Taylor's counsel, Chenoweth testified as follows:

"Q. All right. And in this letter, [counsel for Taylor] also notified Imperial Aluminum that he believed the paint gun was the cause of Tyler Taylor's injury, correct?

"A. Correct.

"Q. That--that he anticipated making a claim for damages arising from this injury, correct?

"A. Correct.

"Q. And that it would be necessary for him to be able to inspect the paint gun and any equipment utilized with it at the time of injury, along with any and all paperwork, documents, bill of sale, et cetera, pertaining to its purchase, manufacture, and maintenance. Do you remember that?

"A. Yes.

"Q. All right. That was not done, correct? That paint gun, along with all of the equipment and the warnings and the literature was not preserved by Imperial Aluminum, correct?

"A. No. It's not correct.

"Q. All right. Part of it was preserved, the compressor.

"A. As far as we know, it was all preserved, but ....

"Q. It was all preserved at one time?

"A. At one time.

"Q. Okay. Well, would you agree that as we sit here today, we don't know where the paint gun is?

"A. Correct.

"Q. We don't know where the box that it came in is, correct?

"A. Correct.

"Q. We don't know where any of the literature or warnings are, relative to the paint sprayer or the paint gun, correct?

"A. Correct.

"....

"Q. Have you seen any of the testimony [in] this case that would indicate ... that the paint gun was with the sprayer when it was initially put up?

"A. No, I have not.

"....

"Q. When was the last time that you know of that the paint gun was still at the plant?

"A. If it was with the sprayer at the time it was put up, that's the last time [Imperial management] knew it was there."

When asked by Taylor's attorney whether the spray gun was stored with the compressor, Chenoweth replied:

"We're not sure ... if the maintenance person--when we say the sprayer, he saw the sprayer unit. Most people think the unit is the sprayer. So at that time, we assumed the gun was with it. We're not sure. Nobody inspected it, just the maintenance person that put it up."

Chenoweth testified that Imperial did not incur any cost for storing the Tradeworks 170 in its...