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STEWART v. UNITED STATES

March 12, 1980

WILLIAM STEWART, PLAINTIFF,
v.
UNITED STATES OF AMERICA, AND NORTH AMERICAN ASBESTOS CORPORATION, A CORPORATION, DEFENDANT.



The opinion of the court was delivered by: J. Waldo Ackerman, District Judge.

ORDER

This case involves a claim against the United States under the Federal Tort Claims Act, 28 U.S.C. § 1346(b), § 2671 et seq., and is based upon the sale of asbestos from the national stockpiles by the Government to Union Asbestos and Rubber Company (UNARCO) and to Owens-Corning Fiberglas Corporation, which purchased the UNARCO plant in 1970. Also named as defendant is North American Asbestos Corporation, a distributor of asbestos fibers who sold asbestos to UNARCO and Owens-Corning. This case was filed in 1976 by five plaintiffs, employees of UNARCO who had contracted asbestosis, a pulmonary lung disease. Four of these plaintiffs voluntarily dismissed their claims pursuant to Federal Rule of Civil Procedure 41(a) and William Stewart, the remaining original plaintiff, died in 1978. Stewart's widow had filed an amended complaint on January 14, 1977, seeking recovery for her husband's medical expenses and for loss of consortium. She remains as the only plaintiff in this case.

A discussion of some background material is necessary to put this case in context. In 1966, the Office of Emergency Preparedness (OEP) was authorized under the Strategic and Critical Materials Stockpiling Act, 50 U.S.C. § 98 et seq., to determine the types and amounts of materials to be stored for national security needs. The OEP requested General Services Administration-Defense Materials Service to prepare a plan for the disposal of excess asbestos. The Stockpiling Act, 50 U.S.C. § 98b(e), requires the express approval of Congress for disposal plans unless the reason for the disposal is obsolescence. This same statute requires that the plan and date of disposal be fixed "with due regard to the protection of the United States against avoidable loss on the sale or transfer of material to be released and the protection of producers, processors, and consumers against avoidable disruption of their usual markets." Accordingly, GSA developed a plan for the disposal of 15,170 short tons of excess amosite asbestos over a period of years. The average acquisition cost was $245 per short ton as of December 31, 1965. The market value as of March 4, 1966 was $241 per short ton.

The plan and a proposed bill were submitted to Congress and on May 11, 1966, the President approved Public Law 89-422 authorizing the Administrator of General Services to dispose of the asbestos. That Act provides as follows:

  Be it enacted by the Senate and House of
  Representatives of the United States of America in
  Congress assembled. That the Administrator of General
  Services is hereby authorized to dispose of, by
  negotiation or otherwise, approximately fifteen
  thousand, one hundred and seventy short tons of
  amosite asbestos now held in the national stockpile
  established pursuant to the Strategic and Critical
  Materials Stock Piling Act (50 U.S.C. § 98-98h) and the
  supplemental stockpile established pursuant to
  section 104(b) of the Agricultural Trade Development
  and Assistance Act of 1954, as amended (7 U.S.C. § 1704(b)).
  Such disposition may be made without regard
  to the provisions of section 3 of the Strategic and
  Critical Materials Stock Piling Act: Provided, That
  the time and method of disposition shall be fixed
  with due regard to the protection of the United
  States against avoidable loss and the protection of
  producers, processors, and consumers against
  avoidable disruption of their usual markets.

Consequently, bids were solicited and the asbestos was sold to UNARCO and others "as-is", without warranties of any kind.

Plaintiff's complaint, Count 6.1, against the United States charges that at the time the product left the defendant's control, the product was not reasonably safe in that:

  (a) it contained no warning or label that inhalation
      of asbestos particles caused fibrosis of the
      lungs and other respiratory pathology, including
      asbestosis;
  (b) it contained no instruction whatsoever as to safe
      methods of handling and processing asbestos
      fibers.

Thus, plaintiff charges the Government with selling an unreasonably unsafe product, a claim sounding in strict liability. See Prosser, Law of Torts, § 99 (4th ed. 1971). It is settled that the FTCA governs negligent or wrongful conduct, but does not extend to claims based on strict liability. Dalehite v. United States, 346 U.S. 15, 44-45, 73 S.Ct. 956, 972, 97 L.Ed. 1427 (1952); Laird v. Nelms, 406 U.S. 797, 921 S.Ct. 1899, 32 L.Ed.2d 499 (1972). Consequently, Count 6.1 is dismissed for failure to state a claim on which relief can be granted.

Counts 6.2 and 6.3 respectively charge the United States with negligence and wilful and wanton conduct in selling the asbestos fibers to the plant without proper warnings or handling instructions when it knew or should have known that inhalation of asbestos particles caused fibrosis of the lungs.

I. Tort Claims Act

The Federal Tort Claims Act, 28 U.S.C. ยง 1346(b), 2671 et seq., waives the Government's sovereign immunity for certain torts, providing relief to victims of negligent or wrongful acts or omissions of Government employees committed while acting within the scope of employment. The Government asserts, however, that it has retained its immunity from liability in this case, relying on 28 U.S.C. ...


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