Perry Lumber Co. v. Durable Services, Inc.

710 N.W.2d 854

271 Neb. 303

PERRY LUMBER COMPANY, INC., appellant, v. DURABLE SERVICES, INC., appellee.

No. S-05-005.

Supreme Court of Nebraska.

March 24, 2006.

COPYRIGHT MATERIAL OMITTED

Larry W. Beucke, of Parker, Grossart, Bahensky & Beucke, Kearney, for appellant.

Jeffrey H. Jacobsen and William T. Wright, of Jacobsen, Orr, Nelson, Wright & Lindstrom, P.C., Kearney, for appellee.

HENDRY, C.J., CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.

MILLER-LERMAN, J.

NATURE OF CASE

Perry Lumber Company, Inc. (Perry), appeals from an order of the district court for Phelps County entering judgment based on a jury verdict in favor of the defendant, Durable Services, Inc. (Durable). Perry brought suit against Durable claiming that Durable was responsible for a fire that damaged facilities owned by Perry. On appeal, Perry asserts that the district court erred in connection with certain rulings with respect to expert testimony presented by both parties regarding the cause of the fire. We conclude that the district court erred in failing to admit the testimony offered by Perry's witness as expert testimony and in limiting the weight the jury could give to such testimony. Such error was prejudicial to Perry and constituted reversible error. We therefore reverse the judgment of the district court, and we remand the cause for a new trial.

STATEMENT OF FACTS

Perry owned and operated a lumberyard and retail sales store in Holdrege, Nebraska. Perry's facilities were remodeled in the early 1990's. As part of the remodeling, Durable designed and installed improvements to the heating and air-conditioning units. Durable's work included installing several duct heaters.

On January 21, 1999, Perry's facilities were damaged by a fire. Perry filed the present action against Durable, claiming that the fire was caused by Durable's improper construction and installation of the duct heaters. Perry asserted theories of recovery based upon negligence, breach of implied warranty, and breach of contract. Perry sought damages of approximately $1.3 million. The action went to trial, and judgment was entered based on a jury verdict in favor of Perry in the amount of $960,840. Durable appealed to this court. We concluded that the trial court had committed reversible error by ruling that Durable's expert could not testify concerning the results of his test which Perry had previously placed in evidence through the testimony of its own expert. We reversed the judgment of the district court and remanded the cause for a new trial. Perry Lumber Co. v. Durable Servs., 266 Neb. 517, 667 N.W.2d 194 (2003).

On remand, prior to trial, Perry filed a motion in limine seeking an order excluding any opinion evidence of Durable's expert, William Buxton, regarding the origin and cause of the fire and any opinion evidence of Buxton to the effect that no expert could determine the origin or cause of the fire. The court overruled Perry's motion in limine and other motions in limine by each party with regard to the anticipated testimonies of other experts. The court stated in its order that

after reviewing the qualifications of the experts, and assuming proper foundation is laid at trial, the objections go primarily to the weight the jury should give the opinions rather than to their admissibility under Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993) and Schafersman v. Agland Coop, 262 Neb. 215, 631 N.W.2d 862 (2001).

The court reserved ruling on admissibility until foundation had been provided at trial.

The second trial was held November 29 through December 3, 2004. Perry presented the testimony of various witnesses, including James Wagner, who was chief of the Holdrege Volunteer Fire Department at the time of trial and was acting chief at the time of the fire at issue in this case. Wagner's duties as fire chief included investigating the origin and cause of fires. Wagner had over 30 years' experience investigating fires. Wagner testified regarding his education and training in fire investigation which included approximately 40 classes offered by the State of Nebraska and by other entities. In those classes, Wagner had studied, inter alia, the National Fire Protection Association's publication No. 921 (NFPA 921), which provides guidelines for a scientific method of fire investigation.

Wagner testified that he was on the scene of the fire on January 21, 1999. After taking part in fighting the fire, Wagner investigated the fire. Wagner testified without objection that in his opinion, the origin of the fire was above the south office and that a duct heater that was in that area had suffered more damage than duct heaters in other areas. Wagner also testified that he had investigated to determine the cause of the fire. When Wagner was asked his opinion regarding the cause of the fire, Durable objected on the basis that although Wagner was qualified to testify as an expert regarding origin, he was not qualified to testify as an expert regarding cause.

After argument and further foundation testimony, the court ruled:

Okay. I'm going to rule [Wagner] can answer the question based on the following: Even if he does not qualify as an expert to provide scientific knowledge, he would qualify under Rule 701. Even if he's not an expert, his testimony in the form of opinions is limited to those opinions that are — which are rationally based on the perception of the witness and helpful to a clear understanding of his testimony or the determination of a fact at issue.

So, I'm not necessarily, ladies and gentlemen of the jury, finding he is an expert, but he can testify based on his observations; and that's the weight you give this testimony. Objection overruled. The witness may answer the question.

Although the court did not read or summarize the text of "Rule 701" to the jury, we note that Nebraska Evidence Rule 701 provides:

If the witness is not testifying as an expert, his testimony in the form of opinions or inferences is limited to those opinions or inferences which are (a) rationally based on the perception of the witness and (b) helpful to a clear understanding of his testimony or the determination of a fact in issue.

Neb. Evid. R. 701, Neb.Rev.Stat. § 27-701 (Reissue 1995). Following the court's ruling quoted above, Wagner testified that the fire was caused by some material that ignited inside the duct heater and that he had come to this conclusion by eliminating other ignition sources.

In addition to Wagner's testimony, Perry also presented testimony by Charles Hoffman, a deputy State Fire Marshal, and Lewis T. Strait, a fire investigator retained by Perry. Both Hoffman and Strait testified that they had investigated the fire pursuant to NFPA 921, and both testified that in their opinions, the origin of the fire was in the area above the south office. Hoffman testified that he could not give an opinion to a reasonable degree of certainty as to the cause of the fire, but he testified that possible ignition sources included elements found in the area of the point of origin. Strait testified that in his opinion, the cause of the fire was the buildup of material in the duct heater above the south office and that the material acted as fuel for the fire and was ignited by the coils of the duct heater.

In its defense, Durable presented, inter alia, the testimony of Buxton. Buxton was a fire investigator, and he testified regarding his training and experience in fire investigation. Buxton's training included sessions of various federal, state, and local training programs, and his experience included investigating between 3,500 and 4,000 fires over 30 years. Buxton also testified regarding his familiarity with NFPA 921 which he described as a "guide" and "an accepted practice for doing the origin and cause investigation of a fire." In discussing NFPA 921, Buxton stated that under its guidelines, if an investigator must assume evidence or information, then the investigator must conclude that the origin and cause of the fire are "undetermined."

Buxton had reviewed the testimony and reports of the experts who testified at the present trial and who had testified at the first trial in this case. Buxton testified that he considered the principles of NFPA 921 in reviewing such materials. When Durable asked Buxton whether he was able to form an opinion to a reasonable degree of certainty as to either the origin or the cause of the Perry fire, Perry objected on the basis of foundation and requested an opportunity to voir dire Buxton about his investigation. The court overruled Perry's objection and request to voir dire and allowed Buxton to answer the question. Buxton testified that he "could not determine the origin of the fire because you would have to assume too many things." He also testified that in his opinion, the other experts who had testified regarding origin and cause of the fire had "assume[d] too many things ... without having the evidence to back it up." Buxton then testified regarding specific assumptions that the other experts would have to have made. When Durable asked Buxton his opinion regarding whether any reasonable investigator following NFPA 921 would have been able to state to a reasonable degree of certainty an opinion as to the origin of the fire, Perry objected, and after argument outside the presence of the jury, the court sustained Perry's objection.

On cross-examination, Buxton acknowledged that he had not performed a site inspection or other procedures which were part of a fire investigation made pursuant to NFPA 921. He also testified that following an investigation pursuant to NFPA 921, an investigator can either make a determination as to the origin or cause or conclude that it is undetermined, but that an investigator must perform an investigation prior to making either conclusion. Following cross-examination, Perry moved the court to strike Buxton's testimony and...