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Domine v. Fulton Iron Works





APPEAL from the Circuit Court of Cook County; the Hon. DANIEL P. COMAN, Judge, presiding.


Plaintiff appeals from the entry of summary judgment in favor of defendant Fulton Iron Works (Fulton) on a complaint seeking recovery from Fulton on the basis of strict liability and negligence, contending that the trial court erred in granting Fulton's motion for summary judgment.

The following facts pertinent to the disposition of this appeal appear in the record.

Plaintiff filed a two-count complaint alleging that he was injured on July 3, 1973, while operating a punch press "designed, manufactured and sold" by defendants Ferracute Corporation (Ferracute), Bridgeton Machine Company (Bridgeton) and Fulton. Plaintiff also named various sellers and distributors of the punch press as defendants. Count I is based upon strict liability and alleges that the punch press was defective and unreasonably dangerous when it left the control of Ferracute, Bridgeton and Fulton. Count II is based upon the negligence of defendants and alleges failure to incorporate various safety devices, to give adequate warnings as to the dangers of the machine, to give proper instructions for assembly, operation and maintenance, and to safely ship the machine.

Fulton, in answer to the complaint, stated that it did not have sufficient knowledge upon which to form a belief as to the manufacturer and distributor of the punch press. Fulton did, however, deny that the punch press was in a dangerous or defective condition when placed in the stream of commerce.

Subsequently, Fulton filed a motion for summary judgment, alleging that it did not manufacture, design or sell the punch press but that the punch press was manufactured by Ferracute "in or prior to 1947." Fulton further stated that on April 22, 1968, it "purchased a product line and certain other assets from" Ferracute and that on May 6, 1968, it purchased certain inventory from Bridgeton, "formerly known as Ferracute." In support of the motion for summary judgment, Fulton attached the affidavit of its president, H.E. Miller, the asset purchase agreement between Fulton and Ferracute, and the bill of sale for the inventory purchased from Bridgeton.

In his affidavit, Miller stated that the punch press was manufactured by Ferracute in Bridgeton, New Jersey, and shipped to the G.M.C. Truck and Coach Division of General Motors Corp. on March 21, 1947. Miller also stated that Fulton removed all the purchased assets to its plant in St. Louis, Missouri; that Fulton did not purchase any of Ferracute's real property; that Ferracute retained certain general machinery and that Ferracute continued to exist as a corporate entity under the name of Bridgeton after the transaction. To the best of Miller's knowledge Ferracute was not rendered insolvent or unable to pay its debts as a result of the transaction and remained able to respond to the claims of its creditors.

The agreement between Fulton and Ferracute is titled "Asset Purchase Agreement" and pertains to "the sale of certain assets." It provided that, prior to Fulton's payment for the assets, Ferracute would adopt a new corporate name which would not include the words Ferracute, Farquhar or Press. Ferracute and its principal shareholders, Mr. and Mrs. George E. Barr, agreed not to produce or sell presses in the continental United States for a period of four years from the date of the agreement. The assets to be transferred were listed in the agreement and included the following: tradenames and trademarks "Ferracute" and "Farquhar"; all patents relating to Ferracute or Farquhar presses; all engineering drawings and related details necessary to produce Ferracute or Farquhar presses; sales literature; file cabinets for records; jigs and fixtures for the production of Ferracute or Farquhar presses; patterns; one completed press; store inventory located at Ferracute's plant; and an agreement not to compete. Fulton agreed to remove the tangible assets from Ferracute's plant within 30 days after payment for said assets.

Plaintiff did not file any counteraffidavits in response to Fulton's motion for summary judgment. On June 21, 1977, the trial court granted Fulton's motion for summary judgment. Plaintiff appeals from the entry of that order.


On appeal plaintiff contends that the trial court erroneously granted Fulton's motion for summary judgment. Section 57 of the Civil Practice Act (Ill. Rev. Stat. 1977, ch. 110, par. 57) provides that a motion for summary judgment should be granted where "the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Applying this principle to the instant case, we believe summary judgment was properly granted.

As to Count I

In count I plaintiff seeks to recover against Fulton on a theory of strict liability in tort. Although plaintiff concedes that the evidence establishes that Fulton played no role in the actual manufacture or distribution of the punch press, he argues that Fulton should be held liable as Ferracute's corporate successor. The general rule regarding the liability of a successor corporation is:

"`* * * that where one company sells or otherwise transfers all its assets to another company, the latter is not liable for the debts and liabilities of the transferor. The purchasing or transferee company, that is to say, is not liable on the other company's obligations merely by reason of its succession to such company's property. To render it liable there must be an agreement express or implied, to assume the other company's ...

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