Another economic-loss-rule case.

Miidas bought some peat moss from Global. One batch of it was bad and ruined Miidas’ crops. Miidas sued for breach of contract, strict liability, and negligent misrepresentation. Global moved for summary judgment on the tort claims, arguing the economic-loss rule. The trial court granted it.

See Flagstaff Affordable Housing to brush up on the rule. This is a products case, so the Court of Appeals used the three-factor test. We said that Flagstaff “throws doubt on the three-factor test itself, apparently signaling a willingness to change it when an appropriate products case comes along.” Miidas argued “Flagstaff signals that Salt River‟s three-part test will soon no longer be the law in Arizona products cases.” The court says “Although we acknowledge the Flagstaff court‟s negative comments about the Salt River test, we agree with Global that despite these comments, Flagstaff did not overrule Salt River.” Which proves that you can lead a horse to water, etc.

So, the three-factor test. First, was the product unreasonably dangerous? Yes, it was unreasonably dangerous – to seeds. If that is how the phrase can be used then of course it means anything – and therefore nothing.

Next, the court demonstrates that the best argument against the three-factor test is its application. For what follows is among the most confused and confusing patches of gobbledygook that’ll you ever have to read in a judicial opinion. Flagstaff should have meant (and we’d bet it was intended to mean) never having to read something like this again. Among other things the court tells us that the second factor, which it never really explains, is not “helpful” here. Well, it’s not helpful because the test is largely nonsense – and you’d think that a case that has to try to say that the growing of a crop happened “suddenly” and “accidently,” or that whether it did or not has to be considered but doesn’t matter, would take up Flagstaff’s invitation to admit that. Instead the decision is largely an analysis of Salt River, almost as though Flagstaff didn’t exist.

The court ends up deciding that  Miidas’ seeds were “other property” and that “the third factor of the Salt River test, as well as the first two, supports [sic] a conclusion that the economic loss rule should not be applied in this case.” (What that odd formulation means we’ll leave as an exercise for the reader.)

If you decide to read this one, though, ask yourself afterward just exactly what doing so has added to your knowledge of the law.

(link to opinion)

This mental-health opinion concerns an alleged conflict between statute and court rule. It comes to the right result but we’re not sure how.

This is an appeal from an involuntary commitment order. The statutes require that two physicians examine the patient before commitment; in this case one had done so in person, the other by “telemedicine.” The Supreme Court had already ruled that that isn’t good enough so in this case the state came up with a new argument: the statutes are unconstitutional because they conflict with Rules 702 and 703 governing the admission of expert testimony. This opinion holds the statues constitutional.

The opinion correctly cites Seisinger v. Siebel as the controlling precedent. Under Seisinger, if a statute and a court rule conflict then the statute prevails if the matter is substantive, the rule if it’s procedural. It’s a two-step analysis: 1) is there a conflict; if so, 2) is it substance or procedure.

But “In this case, the analyses concerning whether the statutes and rules conflict and whether the statutes are procedural or substantive are interconnected.” Why? It’s hard to know if the opinion thinks it explains that. In any event, the opinion goes on to conclude that 1) the statute and rule do not conflict and 2) the statutes establish a substantive burden of proof, as Seisigner permits. “Therefore [the statutes] . . .  are constitutional.”

The problem is that this misses Seisinger’s basic point, which is that the legislature can make procedural rules: “the legislature and this Court both have rulemaking power.” If statute and rule do not conflict then whether the issue is substantive or procedural doesn’t matter. It is reasonable to say “they don’t conflict and even if they did it’s substantive” but that isn’t what this opinion says. It says that the statue is constitutional because it doesn’t conflict and it’s substantive. The permutations of that formulation are incoherent.

(link to opinion)

We may have to stop blaming the government for these notice-of-claim cases. They used to arise because its lawyers were trying to create overly exacting standards for them. Now that the law is fairly well established we seem to be seeing a shift to cases in which the claimant  blew it. 

Mrs. Thompson ran off the road, overcorrected, and flipped over. The Thompsons sued Pima County, claiming that potholes contributed to the accident. The County moved for summary judgment because they hadn’t filed their notice of claim within the required 180 days. The Thompsons contended (“as we understand their argument,” the court says, always a bad sign; and the recitation of facts having already told us that Thompson ran off the road because she was eating a granola bar, you know where this is headed) that the period for filing a notice doesn’t start until the claimant has facts sufficient to make it. They said that that wasn’t until they got a report from their expert – even though both a deputy sheriff and the accident report had told them within a few days that the road may have had something to do with it and even though Mr. Thompson had suspected that based on his own examination. The trial court granted the motion; the Court of Appeals affirmed.

Accrual of the cause of action and facts sufficient to support the notice “are distinct concepts.” Accrual comes “when the damaged party realizes he or she has been damaged and knows or reasonably should know the cause, source, act, event, instrumentality or condition which caused or contributed to the damage,” § 12-821.01(B).  “Facts sufficient”  is from a different paragraph, § 12-821.01(A): the notice must contain “facts sufficient to permit the public entity or the public employee to understand the basis upon which liability is claimed.” That there is 180 days between them emphasizes that they are different things. The discovery rule is built into the statute but in this case there was no question of fact that the Thompsons had plenty of knowledge to file a notice within the 180 days.

(link to opinion)