Before Friendly, Chief Judge, Waterman, Circuit Judge, and McLEAN, District Judge.*fn*
Defendants-appellants Stanley Works (Stanley Chemical Company Division) and Thomas Keller were sued by the Administratrix of the Estate of Parker P. Patch for having wrongfully caused the death of Patch, and by Joseph A. Soucy for having caused Soucy to be injured. From judgments on jury verdicts in favor of each of the plaintiffs the defendants appeal. A jury verdict in the Patch action was returned for $97,000, which amount upon defendants' motion was reduced to $40,000 by the order of the trial judge, and plaintiff-administratrix cross-appeals from that order. Further, defendants-appellants appeal from an order of the trial judge allowing interest on each of the awards from the date the complaints were filed. Further details concerning the appeals are set forth more specifically later in this opinion after exposition of the facts and during discussion of the several issues the parties have raised.
The Stanley Chemical Company, a division of the defendant-appellant Stanley Works,*fn1 produces specially-formulated product finishers tailored to meet the particular vagaries of a given plant's production equipment. The evidence at the trial below, taken in the light most favorable to the plaintiffs, indicated that in 1964 Stanley Works acquired a small Massachusetts corporation engaged in the chemical coating business. In 1960, prior to its acquisition by Stanley, this company had sought to develop a process by which a Hypalon finish could be applied to polyurethane foam by employing a wallpaper coating machine, and to this end it had contacted the Dalbolt Company, a New Hampshire textile printer. However, no subsequent action was taken to further this project until early in 1964, after the acquisition by Stanley Works.
In April of that year Dalbolt requested Stanley to develop a suitable dye or coating compound for use by Dalbolt to print polyurethane foam. Dalbolt's production line, like so many others in the trade, was then, and is now, unique; it employs a three-stage procedure. In the first stage a rotary printing press is involved, which prints or coats the material, generally a fabric, with a color. Then related equipment conveys the coated colored material into and through a drying over composed of two stages-the "preheat" section, designed to evaporate any solvent remaining on (rather than in) the material, and the "fusing" section, designed to fuse the coating to the fabric. Once the material passes through the oven, it normally will be dry and can be rolled immediately.*fn2
Stanley, pursuant to Dalbolt's request, dispatched an employee, defendant-appellant Keller, a "technical representative," to Dalbolt's Keene, New Hampshire, plant. On his first visit, he examined Dalbolt's production line and completed a detailed report describing the process, and, significantly, he recorded the temperature ranges and capacities of the two oven stages. This report was used by Stanley's chemists to develop a coating compound which would function in this unique equipment. Three test runs were held. The first, in May, indicated that large quantities of coating material would be required, as the foam displayed a characteristically high absorptive quality. A second test, using a different ingredient in the compound, was run on June 10 on a small quantity of foam. A third run, interrupted by the explosion here involved, occurred on June 30, 1964, and was to have tested the adaptability of a much larger quantity of material.
For this June 30 test, Stanley sent from its Connecticut laboratory two substances (thirty gallons of one and twenty-five of another) to be combined in New Hampshire to create the coating compound. Under Keller's supervision, these liquids were mixed by a Dalbolt employee and inserted into the troughs of the printing press. In fact, 52 per cent by weight of this compound contained the ingredient Solvesso-100, a potentially highly flammable substance. Dalbolt did not know that this substance was to be used. No literature from Stanley accompanied the cans and the invoices were silent as to their contents. Plaintiff's decedent Patch, Dalbolt's plant superintendent, knew that Solvesso-100 had been used in the earlier June experiment, but he did not know that it would be also used in this test.*fn3 In the past, Dalbolt had used Solvesso on other jobs and knew its flashpoint, i. e., the temperature at which ignition would cause explosion, and so Dalbolt had used it within carefully defined temperature ranges.*fn4 When the liquids had been inserted Keller ordered the oven set at particular ranges and gave instructions as to the length of time the coating process should take. Plaintiff Soucy, a Dalbolt printer and machine operator, was called to the plant immediately prior to the test to make minor modifications in the press machinery, especially to the rollers and sieve cloth, so as to insure that the foam would be completely covered by the compound as it passed through the oven. After making the necessary adjustments he was ordered to start the machine and did so.
Being a highly absorptive material, the foam retained much of the coating compound in liquid form when it passed from the preheat stage where it had not been exposed to an open flame into the fusing stage of the drying oven where there was an open flame and where the temperature was approximately 285 F. This combination of a volatile substance and a high degree of heat was sufficient to push the Solvesso ingredient past its flashpoint, and when the substance contacted the flame an explosion inevitably occurred.*fn5
Plaintiff Soucy suffered serious burns over 97 per cent of his body. Plaintiff's decedent, Dalbolt's plant supervisor Patch, suffered even more serious burns, and died shortly thereafter.
Predicating jurisdiction on the diverse citizenship of the parties, the New Hampshire administratrix of the Patch estate commenced a wrongful death action in May, 1965, against the Stanley Works and Keller*fn6 in the U.S. District Court for the District of Connecticut. Soucy's action was brought in a Connecticut state court and was removed on Stanley's motion to the U.S. District Court. The two cases were consolidated for trial by order of Judge Clarie, and were tried before Judge Blumenfeld and a jury.
The jury returned plaintiffs' verdicts against both defendants, $97,000 for the Administratrix of the Patch Estate and $70,000 for Soucy. A defense motion to reduce the Patch verdict to $40,000 was granted, and the court awarded interest on the $70,000 and $40,000 judgments from the dates the complaints were filed. Issues raised by the defendants' appeals and the Patch cross-appeal are discussed in context hereafter.
We must first determine what consideration, if any, a Connecticut court would accord New Hampshire law if adjudicating these cases, having in mind that the plaintiffs here are New Hampshire citizens and that the explosion occurred in New Hampshire. Sitting in its diversity jurisdiction, the U.S. District Court was bound by a long line of U.S. Supreme Court and federal court decisions mandating that it apply the substantive law of the forum state, Erie R. R. v. Tompkins, 304 U.S. 64, 58 S. Ct. 817, 82 L. Ed. 1188 (1938), including its choice-of-law rules, Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S. Ct. 1020, 85 L. Ed. 1477 (1941); and, in so doing, the court determined that here a Connecticut state court would look to the substantive law of liability of New Hampshire. This threshold determination is not seriously challenged here.*fn7 Thus, looking to New Hampshire substantive law, the court instructed the jury that plaintiffs could recover only on a theory of strict liability, and defined that theory with reference to Section 402A of the American Law Institute's Restatement of Torts, Second (1966).*fn8 Defendants mount three attacks upon this determination: first, that the doctrine of strict liability has no application to the facts here; second, that plaintiffs failed to sustain their burden of proof; and third, that even if the theory of strict liability is legally relevant to the facts, the court's instructions were in error.*fn9
We are confronted at the outset with the relative dearth of New Hampshire law on the subject of strict liability. In Elliott v. LaChance, 109 N.H. 481, 256 A.2d 153 (1969), the New Hampshire Supreme Court cited the Restatement's analysis with approval, and then, exactly six months later, recognized Section 402A to be the law of the state, Buttrick v. Lessard & Sons, Inc., 110 N.H. 36, 260 A.2d 111 (1969).*fn10 Neither case raised the complex issues raised here. In Elliott, the court ruled that plaintiff had failed to prove the existence of a defect in the products used by defendant which, had the defect existed, would have caused the injuries complained of. In Buttrick, plaintiff was nonsuited at the conclusion of his opening statement. He had purchased a new automobile whose headlights persisted in failing during night-time driving. Each time this happened he would return it to his authorized repair service, all to no avail, even though new equipment was added and the car's parts were examined. One evening the lights failed while plaintiff was driving and an accident followed. Suit was brought against the defendant garage. The New Hampshire Supreme Court, quoting from Section 402A, reversed. It held that plaintiff could recover under a strict liability theory "if there is evidence from which a jury could find that the malfunction of the lights caused the accident and arose from a defect present at the time of purchase," 260 A.2d at 113. While instructive, neither decision provides us much help here. Further, our search of New Hampshire law in related areas has profited us little. Nevertheless, even though a state's relevant law is unclear or difficult to ascertain, it is still our duty to render a decision by attempting to apprehend the result that that state's courts would reach, see Bernhardt v. Polygraphic Co. of America, Inc., 350 U.S. 198, 76 S. Ct. 273, 100 L. Ed. 199 (1956), and where the relevant law is interstitial, we may look for guidance "to such sources as the Restatements of Law, treatises and law review commentaries, and the 'majority rule,"' Wright, Federal Courts § 58, at 206 (1963); cf. Delaney v. Towmotor Corp., 339 F.2d 4 (2 Cir. 1964). Happily for us, the New Hampshire Supreme Court cited the Restatement as controlling in both Elliott v. LaChance and in Buttrick, and so, in our search for guidance, we use the Restatement as our point of departure. See also Frumer & Friedman, Products Liability (1968); Kessler, Products Liability, 76 Yale L.J. 887 (1967).
Defendants first claim that the plaintiffs are not within the class which Section 402A seeks to protect, and, also, that the product*fn11 is not of the type against which protection is sought.*fn12 We think that the New Hampshire courts would disagree with defendants. The Reporter's Comments to Section 402A make clear that an employee of an "ultimate consumer or user" is just as entitled to be protected as is his employer. Dalbolt being the ultimate consumer of the liquid coating compound before its properties were changed, both plaintiffs are included within the protected class. See comment 1 to Section 402A. Furthermore, most jurisdictions confronted with this issue have ruled that employees ...