Asbestos for the rest of us: the continued viability of statutes of repose in product liability.

• Author: Bruggenschmidt, J. Alex

INTRODUCTION

Several writers have examined statutes of repose in the context of state-based product liability claims. Scholarship in this area generally centers on the constitutionality of product liability repose statutes, or commentary articulating the policy concerns implicit in the balance of preserving plaintiffs' rights as measured against the hardship experienced by manufacturers and distributors defending lawsuits decades after a product entered the market. (1) This Note takes a different approach on the issue by evaluating whether statutes of repose have, in fact, succeeded as a response to the policy considerations and their justifications espoused in the legal community. This Note challenges whether statutes of repose truly address the concerns of litigants as well as judicial economy in product liability litigation, particularly illuminated in the subset of asbestos litigation. With over 700,000 claims and $70 billion in defense costs in the last three decades, (2) as well as the proclivity for extremely latent injuries, (3) asbestos litigation offers keen insight into the repose statute debate because it is a context in which these statutes exhibit the potential to most precisely serve as well as undermine policy considerations.

What follows is in many respects a troublesome tale because it highlights the quandaries that result when rules of law fail both substantiation on logical and evidentiary grounds and vital testing "against the obdurate matrix of empirical data." (4) To observe the counsel and poignant wisdom of the late journalist Hunter S. Thompson: "The wheels of justice grind small and queer in this life and if they seem occasionally unbalanced or even stupid and capricious in their grinding, my own midnight guess is that they were probably fixed from the start." (5)

Part I of this Note examines the efflorescence of statutes of repose in product liability across jurisdictions, the divergent approaches taken regarding the constitutionality of statutes of repose and the rise of the asbestos litigation "crisis." (7) Part II reviews the manner in which jurisdictions apply statutes of repose in product liability, and the varying policy considerations espoused by legal writers, legislatures, and courts. Part II discusses the impact of statutes of repose in product liability litigation and draws guidance from asbestos litigation, with particular treatment of asbestos claims under Indiana's statute of repose (8) within the Indiana Product Liability Act. (9) Also examined in Part II are the interests of the judicial economy (10) manifested in the enactment and interpretation of repose statutes. Do these statutes ameliorate the burdens placed upon courts faced with voluminous (11) asbestos claims or those on defendants in product claims generally?

Part III explores alternative legal and policy-oriented solutions to the challenges posed by statutes of repose within product liability cases and the subset of asbestos litigation, in the effort to maximize the interests of litigants juxtaposed with the interests of the judicial economy. Such alternatives have been proffered in the alteration of product liability principles in cases involving latent injuries, (12) broad judicial interpretation or the creation of exceptions to statutes of repose for certain products or types of product liability claims, (13) other litigation management techniques, (14) and legislative modification. (15) Part III concludes on the viability of statutes of repose in product liability and asbestos litigation, arguing for the implementation of the rebuttable presumption concept or total abolition. Part III strikes a more tenable balance of the aggregate interests of litigants along with those of the judicial economy.

1. THE DEVELOPMENT OF STATUTES OF REPOSE IN PRODUCT LIABILITY, CONSTITUTIONAL ASSAULTS ON REPOSE STATUTES, AND THE RISE OF THE ASBESTOS LITIGATION "CRISIS" (16)

   Statutes of repose became relevant to the law of product liability less than three decades ago, concurrent with the advent of strict liability principles in the law of products. (17) In the context of this legal zeitgeist, statutes of repose represented a conscious, practical and remedial response to the marked theoretical shift in product liability law at the time. (18) As defendant manufacturers and distributors became increasingly vulnerable to product claims and the prospect of perpetual liability, various states quite naturally began placing additional limits on the time frame in which plaintiffs might recover in product claims. (19) The concomitant upsurge in asbestos-related litigation within product liability (20) provided a revealing context under which to illuminate the policy objectives and substantial shortcomings of statutes of repose.

   A. States Implement Statutes of Repose in Product Liability

   State legislatures began implementing statutes of repose under product liability in the late 1970s and 1980s. (21) These statutes took on two primary forms: the "useful life" product statute and the "time-certain" statute of repose. (22) The following discussion of repose statutes highlights the procedural and substantive implications and differences of the two primary types. Additionally, other time-based defenses, particularly statutes of limitation, the more widely known time defense in the common legal parlance, as well as the discovery rule, (23) more wholly demonstrate the peculiar vigor of repose statutes.

   1. The Genesis of Statutes of Repose. State legislatures first enacted statutes of repose in the late 1950s and early 1960s. (24) These legislatures were initially prompted not by manufacturers and distributors of products, but by interests in the construction industry, particularly the sponsorship of architects' and contractors' trade associations who felt threatened by the increased liability incurred with the abolition of the privity requirement and the shift to the discovery rule (25) in tort statutes of limitations. (26) The abolition of the privity requirement meant that courts no longer required plaintiffs to show the existence of a contractual relationship with a defendant to maintain standing to sue in tort. (27)

      In the product liability context, statutes of repose developed more recently, with the first enacted in Utah in 1977. (28) By 1981, twenty-one states enacted statutes of repose in product liability, (29) and considerable variety existed in terms of drafting and claims subject to repose periods. This initial influx of legislation signaled an effort to soften the explosion of product liability litigation and perceived crisis following the advent of strict liability in this area. (30) These statutes reflect the pressure placed upon legislatures by defendant insurance companies, manufacturers, and distributors who held grave reservations regarding the potential perpetual time frame under which they might retain liability for problems with their or their insured's merchandise. (31) As of 2005, fifteen states (32) utilized time-certain product liability statutes of repose, although considerable variety exists in terms of the period of termination, as well as the particular products, injuries, and types of claims subject to the statute of repose. (33)

   2. Defining Statutes of Repose in Product Liability. The majority of the scholarship surrounding statutes of repose centers on those dubbed "time-certain." (34) These statutes terminate a plaintiff's right to bring a claim after a period of time calculated from the point when the product first entered the market (i.e., when first sold/distributed). (35) The other type of repose statutes, termed "useful life," operates differently and is discussed infra. (36) Typically ranging from six up to fifteen years, time-certain statutes operate as an absolute bar to recovery and terminate plaintiffs' rights to bring claims without any consideration or reference to the point in time when plaintiffs begin to suffer or discover an injury. (37) "[T]he time for filing under a statute of repose is directly related to the age of the product at issue rather than the date on which the plaintiff suffered harm." (38) Most statutes of repose apply to all categories of defects and do not distinguish between suits brought under a negligence theory of recovery or allegations of strict liability, such as defective manufacture, design, or inadequate warning. (39) As one writer has cogently stated, "[I]ndeed the hallmark of statutes of repose is that they can bar the filing of a suit even before a plaintiff suffers an injury, let alone discovers it." (40)

      The Indiana Product Liability Act (41) typifies the operation of repose statutes across jurisdictions:

      Sec. 1. (a) This section applies to all persons regardless of minority or legal disability. Notwithstanding IC 34-11-6-1, this section applies in any product liability action in which the theory of liability is negligence or strict liability in tort. (b) Except as provided in section 2 of this chapter, a product liability action must be commenced: (1) within two (2) years after the cause of action accrues; or (2) within ten (10) years after the delivery of the product to the initial user or consumer. (42)

      To illustrate the straightforward impact of this typical time-certain repose statute, suppose a company places product X on the market in 1996. Person A suffers/discovers some injury unquestionably caused by X in 2007 and files suit against the company in 2008. Person A's claim would be allowed under any state statute of limitation, (43) as A filed within two years of discovering the injury (discovery is synonymous with injury accrual in this context). (44) Person A's claim is still barred, however, because more than ten years passed after the entry of product X to the market place. No matter how compelling the evidence and no matter how egregiously harmed, person A retains no ability to continue through trial to recover in tort under a typical...