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HUFFSTETTLER v. LION OIL CO.

February 14, 1953

HUFFSTETTLER
v.
LION OIL CO.



The opinion of the court was delivered by: John E. Miller, District Judge.

On September 10, 1952, the plaintiff, Bonner Huffstettler, filed his complaint against the defendant, Lion Oil Company, hereinafter often referred to as Lion, in the Circuit Court of Ashley County, Arkansas, in which he alleged:

Plaintiff is a resident of Ashley County, Arkansas. Defendant is a Delaware corporation doing business in Ashley County, Arkansas, and maintains its principal office in El Dorado, Arkansas.

On February 6, 1952, Lion was the owner of a "petroleum bulk plant" at Hamburg, Arkansas, consisting of warehouses, office, equipment, etc.; that Lion owned all property and stock located in and upon the premises, except the equipment used by M.F. Taylor, its distributor, in delivering Lion products to its customers; that Lion furnished this bulk plant, and operating facilities located thereon, to M.F. Taylor in furtherance of its effort in marketing its products.

Plaintiff was employed by M.F. Taylor and his duties consisted of, among other things, delivering Lion products to consumers and retailers; that about one o'clock p.m. on February 6, 1952, in performance of his duties as a tank truck driver and salesman of Lion products, plaintiff was informed by Mr. Frank Woods, who was at the time employed by M.F. Taylor, and who was known to the plaintiff as the bulk plant manager, that Mrs. Joe Kustren (Kusturin) was without gasoline, and Woods instructed plaintiff to make the delivery; that plaintiff obtained the keys from the wareroom in order to unlock the lower valve of the gasgline storage tank, which was located directly in front of the door to the office of the bulk plant; that approximately four feet above the lower valve was a lever valve which was used to regulate the flow of gasoline from the storage tank into the delivery truck, and that this valve was usually and customarily operated while standing on the truck, from which place the flow of the gasoline into the truck could be regulated.

The lower valve was a screw-type valve, and as plaintiff opened the valve, gasoline gushed out of and from the loading pipe arm and the pipe sleeve which was situated over the arm, falling upon him and upon the platform on which he stood. That plaintiff began to close the lower valve at which time he heard an unusual sound, resembling a strong wind. That the sound came from behind him, and within an instant he was enveloped in flame.

At the time the gasoline escaped from the loading pipe there was an open-face natural gas heating stove, which was aflame, located in the office not more than 12 feet from the point where he was standing at the time of the explosion; that he had no knowledge that natural gas was burning within the stove at the time of the explosion; that it was a warm day and the door of the office was open; that the explosion originated at the location of the open-face heating stove and that the blast of fire which covered him came from his back and from the open-face heating stove.

Plaintiff received severe and permanent injuries as a result of the explosion.

The defendant was guilty of negligence which was the proximate cause of the accident. That defendant's negligence consisted of:

"a. The failure of the defendant, Lion Oil Company to provide and furnish the plaintiff, Bonner Huffstettler, with a safe place to work.

"b. The failure of the defendant, Lion Oil Company to exercise ordinary care in permitting and placing an open-face heater within 12 feet of the loading pipe.

"c. The failure of the defendant, Lion Oil Company to recognize the danger to which persons were exposed as a result of an open flame, when they had, or should have had, superior knowledge as to the peculiar combustible qualities of their product, gasoline.

"d. The failure of the defendant, Lion Oil Company, to use ordinary care in requiring the servants of M.F. Taylor to load gasoline near an open and unguarded flame.

"e. The failure of the defendant, Lion Oil Company, to properly warn the employees of M.F. Taylor as to the danger existing at their petroleum bulk plant at Hamburg, Arkansas.

"f. The failure of the defendant, Lion Oil Company to properly construct its buildings and equipment in a fashion sufficient to protect the employees of M.F. Taylor."

Plaintiff was not guilty of any contributory negligence.

Plaintiff prayed judgment for $143,000, costs, and all proper relief.

On September 23, 1952, the case was removed to the United States District Court for the Western District of Arkansas, El Dorado Division, on the grounds of diversity of citizenship of the parties and the amount involved.

Thereafter, the defendant on November 15, 1952, filed its motion for summary judgment in which it alleged:

That plaintiff was an employee of M.F. Taylor who was a distributor of defendant's products and in charge and control of defendant's bulk plant at Hamburg, Arkansas.

That at the time of the accident, it was and had been for many years prior thereto the defendant's custom and practice to enter into written contracts with gasoline service station operators; that such contracts were designated as "Dealer Sales Agreements" and "Equipment Rental Agreements."

That all sales made by M.F. Taylor to such dealers were made in the name and on behalf of the defendant and all products so sold were owned solely by the defendant.

That by virtue of the various contracts, the defendant Lion was a "contractor", M.F. Taylor was a subcontractor, and plaintiff was a statutory employee of the defendant under the provisions of Section 6 of the Workmen's Compensation Law of the State of Arkansas, Ark.Stats. § 81-1306.

That plaintiff at the time of the accident was engaged in the performance of his duties as an employee of M.F. Taylor in carrying out the performance of an obligation of the defendant arising under the provisions of one of the Dealer Sales Agreements; that M.F. Taylor had failed to afford coverage for his employees under the provisions of the Workmen's Compensation Law and that the defendant had failed to require M.F. Taylor to carry such coverage; that at the time of the accident and at all times since defendant has been qualified in its own name and behalf as a self-insurer under the Workmen's Compensation Law of Arkansas.

That the right of plaintiff is limited solely and exclusively to the rights afforded him by the provisions of the Workmen's Compensation Law of Arkansas and that this Court has no jurisdiction of this suit.

Defendant attached to the motion as Exhibit A a copy of the Distributor's contract in force, at the time of the accident, between M.F. Taylor and the defendant. Defendant also attached as exhibits B and C copies of a "Dealer Sales Agreement" and an "Equipment Rental Agreement" entered into between the defendant and W.C. Breazeal, one of the retail dealers, and stated that the provisions of these contracts were identical with similar contracts entered into by the defendant with other retail dealers, and reflected the methods and procedures universally followed in the transactions between defendant and service station operators.

In support of the motion the defendant also attached the affidavits of C.E. Bethel, the defendant's Assistant Manager of Station Sales; M.F. Taylor, the defendant's Distributor at Hamburg, Arkansas; and Dave Peel, Chairman of the Workmen's Compensation Commission of the State of Arkansas.

On December 24, 1952, plaintiff filed his response to the motion for summary judgment in which he stated that "there is a genuine issue of fact to be presented to the court on the question pertaining to the relationship of the parties. Plaintiff further states that the motion filed herein by the defendant company is premature inasmuch as, at this stage of the proceedings, the genuine and material factual issues necessary to determine the relationship of the parties cannot be adequately presented to the court upon pleadings accompanied by affidavits."

Upon the issues raised by the defendant's motion and the plaintiff's response thereto, the parties filed briefs in support of their respective contentions and, at the request of the court, oral argument was heard on January 15, 1953. During the course of the oral argument, counsel for both parties agreed that there was no genuine issue of fact raised by the motion, its exhibits and the affidavits attached thereto, and that the relationship between defendant and M.F. Taylor, and the relationship between defendant and the various service station operators was correctly set forth in the exhibits and affidavits then on file, but the Judge suggested to counsel that, since the plaintiff in his response had alleged that there was a factual question as to the relationship of the parties and the complaint alleged that the gasoline was being loaded into the tank truck for delivery to Mrs. Joe Kusturin (erroneously spelled as Kustren in the complaint), he desired specific proof as to the relationship between Lion and Mrs. Kusturin. Thereupon, the attorney for Lion asked permission to furnish a copy of the contract under which Mrs. Kusturin was operating the filling station and supplemental affidavit or affidavits, which permission was granted. In accordance with the suggestion by the court, counsel for Lion furnished a photostatic copy of the contract entered into between Lion Oil Refining Company and Mr. Joe Kusturin, the now deceased husband of Mrs. Joe Kusturin, and a supplemental affidavit of M.F. Taylor disclosing that said contract was entered into on May 31, 1939, and that, until his death in 1945, Mr. Kusturin operated his service station under the provisions of the contract, and that Mrs. Kusturin, as his surviving widow, and the Lion Oil Company, defendant, as the successor to Lion ...


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