author: HILL, Circuit Judge.

text:
    Jerome B. GUINAND, Plaintiff-Appellant, v. ATLANTIC RICHFIELD COMPANY, Defendant-Appellee.
    No. 73-1040.
    United States Court of Appeals, Tenth Circuit.
    Argued and Submitted July 12’, 1973.
    Decided Oct. 12, 1973.

      Raymond B. Whitaker, Casper, Wyo,, for plaintiff-appellant.
    Houston G. Williams, Casper, Wyo. (Hunter L. Johnson, Jr., Denver, Colo., on the brief), for defendant-appellee.
    Before HILL, SETH and HOLLOWAY, Circuit Judges.
   HILL, Circuit Judge.

In this diversity case, the appeal is from a summary judgment for defendants entered in the United States District Court of Wyoming. The complaint sought damages under both a contract and a tort theory based upon appellee’s failure to obtain an extension of an oil and gas lease in which appellant held an overriding royalty interest. The facts were stipulated.

A five-year federal oil and gas lease was issued to Jerome B. Guinand with an effective date of November 1, 1959. The lease covered 1,080 acres in Campbell County, Wyoming. During 1963 that lease was assigned to Sinclair Oil and Gas Company. In that assignment, Guinand reserved a three percent overriding royalty, one-sixth of which override was later assigned to F. W. Tuttle. The effective life of the lease was subsequently extended by the government to October 31, 1969. By virtue of several mergers during the course of the lease, Atlantic Richfield succeeded to the rights and obligations of Sinclair under Guinand’s assignment.

Under provisions of 43 C.F.R. 192 (now 43 C.F.R. 3107), the 1959 lease could have been extended an additional two years by either a partial assignment by appellee or a release by appellee followed by Guinand’s partial assignment to another prior to October 1, 1969.

Atlantic desired to extend the lease subject to the above provisions, and thus about August 22, 1969, appellee arranged with Chandler & Associates, Inc. for Chandler to accept such an assignment of the lease as to 40 acres, and expected that Chandler would promptly take the necessary action to obtain Bureau of Land Management approval of the assignment.

Later, on September 11, 1969, Paul T. Walton, on behalf of appellant, wrote to the lease department of Atlantic inquiring as to the status of the lease in question and of another lease later involved in state court litigation. Atlantic replied that, “Assignments have been filed and when approved will extend such lease for two years.” The assignment to Chandler was not subsequently forwarded to the Bureau, and as a result the lease expired on October 31, 1969.

In the instant complaint, appellant urged first that the reassignment clause of the assignment contract should be interpreted to establish contractual liability and, secondly, that outside the contract, either under an “estoppel” or negligence theory, Atlantic’s acts had rendered it liable in tort.

In any discussion of the merits in this appeal, it is imperative that we note the case of Walton v. Atlantic Richfield Co., 501 P.2d 802 (Wyo.1972). In that case the Wyoming Supreme Court was faced with an identical contract and essentially identical facts. Additionally, the parties in that suit included the parties in this appeal, and plaintiffs asserted the same grounds for recovery as in the present complaint. In Walton, the state district court ruled that the reassignment provisions of the contract were not applicable to the facts, but held that tort liability was established. Only the issues of contract liability and damages were appealed to the Wyoming Supreme Court. In its opinion, the supreme court specifically affirmed the state district court holding that no contractual liability could arise in that case as Atlantic did not desire to terminate the lease but rather took steps to retain it. Thus none of the obligations under that clause could establish contract liability in that factual setting.

We can imagine no clearer case for the application of the doctrine of Erie Ry. Co. v. Thompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), than in the assertion of contract liability in the present appeal. The Supreme Court of Wyoming has clearly established the law in that state as denying such liability under an identical contract clause and, for all purposes, identical facts. Thus the federal district court was correct in its denial of contract liability in this case.

As a result of this view concerning the application of Walton, we are left with only the issue of possible tort liability based upon Atlantic’s representations to appellant and its subsequent failure to obtain an extension of the lease.

In regard to this issue, appellant has urged that Erie Ry. Co. v. Thompkins requires that we reverse the summary judgment based upon the Wyoming district court's holding that established tort liability under essentially the same facts. However, we do not agree that such recognition of the state district court ruling is mandated by federal diversity doctrines.

As indicated above, the Wyoming Supreme Court did not rule upon the issue of tort liability. In fact they indicated in their opinion that “. . . Although appellee did not appeal the judgment herein it does suggest in its brief and argument that no liability could arise in absence of the applicability of the reassignment clause. This would raise a most interesting question of how, in the absence of a contractual duty, any liability against appellee could arise. In the absence of any appeal by appellee this is moot and discussion is futile.” Walton v. Atlantic Richfield Co., supra, 501 P.2d at 804.

Thus appellant presents only the unappealed decision of the state district court, not an affirmative holding by the highest court of the state. Such an unreported, unpublished decision from a state district court is of little value in considering what course the Supreme Court of Wyoming would take. Commissioner v. Estate of Bosch, 387 U.S. 456, 87 S.Ct. 1776, 18 L.Ed.2d 886 (1967); King v. United Commercial Travelers, 333 U.S. 153, 68 S.Ct. 488, 92 L.Ed. 608 (1948); and State Farm Mut. Auto. Ins. Co. v. Travelers Indem. Co., 433 F.2d 311 (10th Cir. 1970).

Therefore it appears that the federal district court was free to rule upon these tort issues as if this case were one of first impression in Wyoming. Further, this court has consistently recognized the particular qualifications of a federal district judge in determining state law in his district. Hence we have held that when state law appears to be unsettled, we will give great weight and credence to the federal district court’s interpretation.

Though in his arguments on the motion for summary judgment appellant was very imprecise in his explanation of his claim in regard to tort liability, it appears that what he asserted was negligence. It is well settled that no liability can be grounded on negligence if no duty exists on the part of the defendant. Hines v. Sweeney, 28 Wyo. 57, 201 P. 1018 (1921). In that regard, this Court has established that an assignee owes no duty to his assignor to continue a government lease in effect outside contract provisions. Phillips Petroleum Co. v. McCormick, 211 F.2d 361 (10th Cir. 1954). Thus the securing of an extension of the lease was not a duty of appellee, and its failure to do so is not grounds for liability in negligence.,

The appellant, however, attempts to argue that as appellee indicated it had filed the new assignment and because appellant relied upon that statement, a duty to use some degree of care was established. Such an argument ignores the rights and obligations of the parties in this situation. Guinand could not have relied upon appellee’s statement to his detriment as he had no rights in this situation outside the contract, and under that contract he could not obtain an extension through his own actions in any manner. Only if appellee surrendered the lease to appellant could Guinand partially reassign the lease to another and gain the extension he desired. Contractually he could not require such a surrender and thus could not forego any legal right in reliance on appellee’s representation. Therefore we must affirm the district court as no basis for recovery, either contract or tort, recognizable under Wyoming law was presented by the facts as stipulated. No issue of fact necessitated jury determination, and as both parties sought summary judgment, its application was correct in this situation.

Lastly appellant, though he did not urge it upon the district court, now asserts fraud as a possible basis for recovery. It is sufficient to indicate that he has never offered to introduce any evidence to show bad faith or fraudulent intent on the part of the appellee. Fraud will not be imputed to any party when facts and circumstances out of which it is supposed to arise are consistent with honesty and purity of intention. And further, we have held that ordinarily an appellate court will not consider an issue of fact not presented to the trial court. This claim by appellant presents no exceptional question of law that would merit ignoring that rule.

Affirmed.

      . Paragraph 0 of the contract read in part as follows: If Assignee shall desire to surrender and release said lease to the United States before said lease terminates by operation of law of the lease terms, Assignee will accordingly give notice to Assignor at least thirty (30) days prior to the rental or expiration date, and if witliin fifteen (35) days thereafter, Assignor, or any one of thorn, shall notify Sinclair that such lease as to the lands included in the notice be reassigned to Assignor, then Assignee, will, without warranty, reassign such lease to Assignor. .

      . Markon v. Goodall, 478 F.2d 1052 (10th Cir. 1973); United States v. Hershberger, 475 F.2d 677 (10th Cir. 1973); Hardberger & Smylie v. Employers Mut. Liab. Ins. Co., 444 F.2d 1318 (10th Cir. 1971).

      . Twing v. Schott, 80 Wyo. 100, 338 P.2d 839 (1959).

      . Gomes v. Williams, 420 F.2d 1364 (10th Cir. 1970); Eureka-Carlisle Co. v. Rottman, 398 F.2d 1015 (10th Cir. 1968) ; Justhein Petroleum Co. v. Hammond, 227 F.2d 629 (10th Cir. 1955).


source: Caselaw Access Project

author: TAMM, Chief Judge:

license: Public Domain

text:
    Ellec MOSLEY, Appellant, v. NATIONWIDE PURCHASING, INC. and Kuni Cadillac, Inc., Appellees.
    No. DC-12.
    Temporary Emergency Court of Appeals.
    Oct. 9, 1973.

      David C. Niblack, Niblack & Whalen, Washington, D. C., for appellants.
    Kidders H. Friedman, Trammell, Rand, Nathan & Lincoln, Washington, D. C., for appellees; Michael Finn, Kaplan & Finn, Southfield, Mich., and Michael J. Walsh, Rankin, Walsh, Ragen & Roberts, Portland, Or., on the briefs.
    Before TAMM, Chief Judge, VAN OOSTERHOUT and HASTINGS, Judges.
   TAMM, Chief Judge:

This action was commenced in the United States District Court for the District of Columbia by the appellant, Ellec Mosley. Mr. Mosley alleged willful overcharge in violation of the Economic Stabilization Act of 1970 and sought treble damages under § 210 of the Economic Stabilization Act Amendments of 1971, 12 U.S.C. § 1904 (Supp. II, 1972). Service was made on both defendants under 13 D.C.Code § 13-423(a) (Supp. V, 1972)

Defendant-appellee Kuni Cadillac, Inc. (hereinafter Kuni), an Oregon corporation, timely moved to dismiss the action on the ground that the district court lacked personal jurisdiction because Kuni was not “transacting any business” within the District of Columbia. Defendant-appellee Nationwide Purchasing, Inc. (hereinafter Nationwide), a Michigan corporation, timely moved to dismiss on the ground that venue was improper, 28 U.S.C. §§ 1391(b) and (c) (1970) not having been satisfied. Alternatively, Nationwide requested a change of venue to the United States District Court in Detroit, Michigan, pursuant to 28 U.S.C. § 1406(a) (1970). The district court granted Kuni’s motion to dismiss and Nationwide’s motion for change of venue. From these rulings appellant takes this appeal. For the reasons set out below, we affirm.

Before considering the issues raised by appellees’ motions, the pertinent facts may be briefly stated. Sometime prior to September 17, 1971, appellant Mosley, a District of Columbia resident, made inquiry to Nationwide concerning the purchase of a 1972 Cadillac automobile. On September 17, 1971, Nationwide sent appellant a letter acknowledging his inquiry together with a purchase order. This purchase order was executed by appellant and returned by mail to Nationwide along with a deposit.

Nationwide thereupon telephoned Kuni about the possibility of obtaining the Cadillac desired by appellant. This inquiry was formalized by a purchase order from Nationwide to Kuni dated December 29, 1971. Kuni ordered the automobile from the factory, paid for it, and delivered it to Nationwide in Detroit.

On December 30, 1971, Nationwide sent appellant a letter acknowledging receipt of his deposit, and informing him that his automobile had been ordered from the factory. Enclosed in the letter were several forms which appellant executed and returned to Nationwide. In early March, 1972, appellant mailed a cashier’s cheek to Nationwide for the balance due on the automobile. On March 18, 1972, appellant traveled to Detroit and accepted delivery of his automobile at the home of a Nationwide employee.

Appellees Kuni and Nationwide have successfully challenged the maintenance of this action in the District of Columbia, each for different reasons. Therefore, each appellee will be considered separately.

Appellee Kuni Cadillac, Inc.

Kuni challenges service of process under 13 D.C.Code § 13-423(a)(1) (Supp. V, 1972) which appears in the margin supra. The trial court dismissed as to Kuni holding that: “Under the circumstance of this case, plaintiff has failed to show that defendant Kuni Cadillac transacted ‘any business in the District of Columbia,’ or that it had the requisite ‘minimum contacts’ in this jurisdiction.” Mosley v. Nationwide Purchasing, Inc., Civil Action No. 470-73, 3 (D.D.C., June 22, 1973) (footnotes omitted).

13 D.C.Code § 423(a)(1) is modeled after the Uniform Interstate and International Procedure Act. It has been noted that the “transacting business” section here under consideration has been given “broad interpretation, normally limited only by due process considerations.” Margoles v. Johns, 483 F.2d 1212, at 1218 (D.C.Cir., 1973). However, an elaborate discussion of the leading cases is not required here. Kuni has not “transacted any business” in the District, however broadly the phrase be interpreted. Kuni was not solicited by appellant, nor paid by him. Kuni maintains no office nor agent in the District. Kuni sold an automobile to Nationwide and thereafter exercised no control over nor had any knowledge of the price at which the automobile would finally be sold to appellant. Clearly, Kuni has taken no action to connect it with the District. Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958).

Appellant attempts to rely upon Liberty Mutual Insurance Co. v. American Pecco Corp., 334 F.Supp. 522 (D.D.C. 1971). Appellant’s reliance is misplaced. The court in that case was interpreting the reach of sub-section (a) (4) of the long-arm statute. In this case, however, appellant must meet the requirements of sub-section (a)(1) and he has alleged no ties between Kuni and the District.

Finally, it is to be noted that appellant in his complaint alleged that Kuni did business “in the District of Columbia through its agent Nationwide Purchasing.” The record contains no evidence of any agency relationship between the two appellees; they merely transact business from time to time.

Appellant has the burden of proof in establishing jurisdiction over Kuni. McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 56 S.Ct. 780, 80 L.Ed. 1135 (1936). We agree with the trial court that appellant has failed to allege facts sufficient to satisfy this burden. Therefore, we affirm the dismissal as to Kuni without prejudice to appellant in the event he can establish jurisdiction elsewhere.

Appellee Nationwide Purchasing, Inc.

The trial court granted Nationwide’s motion for change of venue to Detroit, Michigan pursuant to 28 U.S.C. § 1406(a) (1970), saying “[T]he record indicates that the proper venue for this litigation is Detroit, Michigan. Accordingly this cause of action is hereby transferred to the United States District Court in Detroit, Michigan, for a fair disposition on the merits.” Mosley v. Nationwide Purchasing, Inc., Civil Action 470-73, 3 (D.D.C., June 22, 1973). The trial court necessarily must have found that the District of Columbia was the “wrong district” within the language of 28 U.S.C. § 1406(a).

In this case, not founded solely on diversity, venue is proper in the judicial district where Nationwide “resides”. 28 U.S.C. § 1391(b). A corporation’s residence is defined by § 1391(c) to be that district where the corporation is 1) incorporated; or 2) licensed to do business; or 3) doing business. Nationwide is neither incorporated nor licensed to do business in the District of Columbia. The question thus becomes whether Nationwide is “doing business” in the District.

An examination of the record clearly indicates that the instant transaction had but one tie to the District of Columbia, i. e., the presence of the plaintiff-appellant. The appellant has made no showing that Nationwide has any contact with the District whatsoever. Nationwide appears to have no office in the District, no agent here, no telephone listing, no bank accounts, no local advertising, nor a systematic mailing of brochures into the District. Additionally, appellant accepted delivery of the automobile in Detroit.

Appellant makes the argument that the contract for sale of the automobile was made in the District when the appellant signed and mailed the purchase order. We agree with the trial court that the purchase order constituted an offer by appellant to Nationwide and was not binding upon the parties until Nationwide accepted the terms and conditions of sale. Eliason v. Henshaw, 17 U.S. (4 Wheat.) 225, 4 L.Ed. 556 (1819); Transit Bus Sales v. Kalamazoo Coaches, 145 F.2d 804, 806 (6th Cir. 1944).

Under the facts of this case as contained in the record, we believe the trial court correctly concluded that Nationwide was not “doing business” within the District of Columbia as required by 28 U.S.C. §§ 1391(b) and (c). See, e. g., Martin v. Fischbach Trucking Co., 183 F.2d 53 (1st Cir. 1950); Employers Liability Assur. Corp. v. Lejeune, 189 F.2d 521 (5th Cir.), cert. denied sub nom. Lejeune v. Excess Insurance Co., 342 U.S. 869, 72 S.Ct. 111, 96 L.Ed. 653 (1951). Venue was therefore laid in the “wrong district” and transfer “in the interests of justice” under section 1406(a) was within the discretion of the trial court.

It is to be noted that appellee Nationwide has raised no objection to service of process under 13 D.C.Code § 13-423(a)(1). Accordingly we need express no opinion on the question of whether Nationwide’s activities would meet the “transacting any business” standard of that statute.

The rulings of the trial court are therefore

Affirmed.

      . 13 D.C.Code § 13-423(a) (Supp. V, 1972) reads in pertinent part:
      (a) A District of Columbia court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a claim for relief arising from the person’s— (1) transacting any business in the District of Columbia ....

      . 28 U.S.C. §§ 1391(b) and (c) (1970) state:
      (b) A civil action wherein jurisdiction is not founded solely on diversity of citizenship may be brought only in the judicial district where all defendants reside, or in which the claim arose, except, as otherwise provided by law.
      (c) A corporation may be sued in any judicial district in which it is incorporated, or licensed to do business or is doing business, and such judicial district shall be regarded as the residence of such corporation for venue purposes.

      . 28 U.S.C. § 1406(a) (1970) states:
      (a) The district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interests of justice transfer such case to any district or division in which it could have been brought.

      . Thus we have a situation in which jurisdiction is proper (i. e. at least not contested), but venue is found improper, the corporation not “doing business” within the meaning of 28 U.S.C. § 1391(c). The test for “doing business” under § 1391(c) is a federal test. Rensing v. Turner Aviation Corp., 166 F.Supp. 790, 795 (N.D.Ill.1958). This § 1391 test is not necessarily the same as that under a state long-arm statute used to acquire jurisdiction over a foreign defendant. See, e. g., Rensing v. Turner Aviation Corp., supra at 796; Remington Rand, Inc. v. Knapp-Monarch Co., 139 F.Supp. 613, 618-619 (E.D.Pa. 1956); Carter v. American Bus Lines, 169 F.Supp. 460, 469-470 (D.Neb.1959).


author: ORIE L. PHILLIPS, Circuit Judge.

text:
    George C. WALLACE and Mauzella Wallace, Petitioners-Appellants, v. COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellee. Marvin Ansel YOUNG and Glendora May Young, Petitioners-Appellees, v. COMMISSIONER OF INTERNAL REVENUE, Respondent-Appellant.
    Nos. 73-1028, 73-1029.
    United States Court of Appeals, Tenth Circuit.,
    Argued and Submitted July 11, 1973.
    Decided Sept. 13, 1973.
    Reid Robison, Oklahoma City, Okl., for petitioners-appellants.
    Robert P. Brandenburg, Jr., Norman, Okl., for petitioners-appellees.
    Dennis M. Donohue, Atty., Dept. of Justice (Scott P. Crampton, Asst. Atty. Gen., Meyer Rothwacks and Bennet N. Hollander, Attys., Dept. of Justice, on brief), for the Commissioner of Internal Revenue.
    Before PHILLIPS, HILL and DOYLE, Circuit Judges.
   ORIE L. PHILLIPS, Circuit Judge.

This is an appeal by George C. Wallace and Mauzella Wallace to review a decision of the Tax Court, 58 T.C. 629.

George and Glendora May Young, formerly Wallace, were married on November 22, 1941. They were divorced by a decree of the District Court of Cleveland County, Oklahoma, on June 25, 1963. At the time of the divorce, they had three minor children. The divorce decree ordered that the custody of such minor children should be awarded to Glendora, with visitation rights in George, and that George should pay Glendora during the minority of each child the sum of $150 per month for the support of such child.

The divorce decree further provided for the division of their property, and that George should pay to Glendora the sum of $41.650 alimony in monthly installments of $350 each, on or before the 15th day of each succeeding month, until fully paid.

George paid to Glendora the monthly alimony installments of $350 during each month from July 1963 to January 1964, inclusive.

From a period beginning in February 1964 until December 1964, George did not pay the full amount of the alimony installments. In that year, he was twice cited for contempt, and was adjudged guilty of contempt on May 6, 1964. He was purged of that contempt on September 28, 1964. He was again cited for contempt on November 13, 1964. That charge was set for trial on December 10, 1964. On that day, George and Glendora entered into an agreement which was presented to and approved by Honorable Elvin J. Brown, Judge of the District Court of Cleveland County, Oklahoma, by an order entered on December 10, 1964. As we shall hereafter show, such agreement did not in anywise modify the divorce decree; and particularly did not in any way modify the provision of the divorce decree that George should pay Glendora $41,650 alimony in monthly installments of $350 each, the first installment to be paid on or before July 15, 1963, and the remaining installments on or before the 15th day of each succeeding month thereafter until the full amount of such alimony was paid; and that the sole effect of such agreement was to estop Glendora from enforcing by contempt proceedings the payment by George of the unpaid amount of any monthly installments due her for alimony under the provisions of the divorce decree, if he paid her $250 on January 1, 1965, and that amount in each succeeding month thereafter, until the youngest of such minor children, Darrell, became emancipated or reached his majority; and if he paid her $400 in each succeeding month thereafter, until the balance of the unpaid alimony he owed her on January 1, 1965, which was $38,050, was fully paid.

Beginning in January 1965, George paid Glendora $250 per month on the alimony until Darrell joined the armed forces of the United States about January 22, 1969, and thereafter George paid Glendora $400 per month on the alimony up to the date of the trial in the Tax Court on February 28, 1972. If he continued to make such payments of $400 per month to and including May 1974, he would have paid the full amount of the $38,050 alimony in approximately 114 months (114.166 months). Had he paid the full amount of. the alimony in monthly installments of $350 per month, as provided in the divorce decree, he would have completed the payment of the $41,650 in 119 months. However, between July 1963 and December 1964, a period of 18 months, George only paid $3,600 on the alimony. Eighteen months added to 114.166 months equals 132.166 months, which is more than 10 years.

In 1968, when Glendora learned that George was taking deductions on his federal income tax returns of the payments made by him to her, she filed a motion to clarify the order of approval of the alimony agreement.

After the taking of testimony and the filing of briefs, Judge Brown held that he was without jurisdiction to modify the provisions of the divorce decree.

On appeal from that order, the Supreme Court of Oklahoma held that the state district court did have jurisdiction to modify the divorce decree, and remanded the case with directions to grant a rehearing.

On remand, the matter came on for rehearing before Judge Brown. Both parties appeared in person and by their respective counsel and stipulated that there was no new evidence, and that Judge Brown could reconsider all the evidence previously introduced.

At such rehearing, neither party requested the court to hold that the provision of the decree requiring George to pay Glendora as alimony $41,650 in monthly installments of $350 each on or before the 15th day of each succeeding month was in anywise modified by the alimony agreement; George specifically agreed that he remained obligated to pay the alimony award in monthly installments of $350 per month on or before the 15th day of each succeeding month; and Glendora specifically stated that while she knew the alimony was accumulating at the rate of $350 per month, she agreed not to bring contempt proceedings against George if he made the alimony payments at the rate of $250 per month until Darrell’s “child support stopped,” and thereafter, at the rate of $400 per month. At the conclusion of the hearing Judge Brown prepared and filed a memorandum. A copy of the part here pertinent is set out in Note 1 hereto. In such part he set forth the facts we have just recited, and stated: “Therefore, the Court concludes that it was not the intention of the parties or of the Court” by such agreement “to modify the alimony award contained in the * * * Divorce Decree * * * but that it was the announced intention of the parties and Order of the Court to estop the plaintiff (Glendora) from enforcing the collection through contempt” proceedings “of more than $250.00 per month until” the “majority or emancipation” of Darrell, and thereafter “$400.00 per month.”

Thus, it will be seen that Judge Brown concluded that it was not the intent of the parties or the court to modify the alimony award of the original divorce decree. Judge Brown caused an order to that effect to be duly entered. No appeal was taken from that order by either party, and it is final and binding on both parties to the alimony agreement.

After such order was entered, both George and Glendora filed a motion for the allowance of attorney’s fees and costs. The court refused to allow George the attorney’s fees or costs and an order was entered accordingly. On George’s appeal from that order, the Court of Appeals of the State of Oklahoma held that George was the prevailing party on the first appeal and was entitled to recover his costs on that appeal. It held, however, that although the matter of the allowance of attorney’s fees arose in a divorce proceeding, it was within the discretion of the trial court, and that the court in disallowing attorney’s fees did not abuse its discretion. In such appeal involving the allowance of attorney’s fees and costs, George undertook to have the court pass on the question of whether the alimony agreement modified the divorce decree with respect to alimony. The court refused to do so on the ground that that question was not an issue involved in the appeal in the matter of the allowance of attorney’s fees and costs.

The decision of the Court of Appeals of Oklahoma was not reviewed by the Supreme Court of Oklahoma on writ of certiorari, and on July 26, 1973, the Supreme Court of Oklahoma issued its mandate to the District Court of Cleveland County, commanding it to show of record in such District Court the decision of the said Court of Appeals. Thus, it will be seen that the decision of the Court of Appeals has become final.

In their income tax returns for the taxable years 1966 and 1967, George and Mauzella claimed as deductions the amounts paid by George to Glendora in those years. Glendora and Marvin, in their income tax returns for the years 1966 and 1967, did not include as income the amounts so paid by George in those years.

• The question presented is whether such payments made by George were installment payments or periodic payments. If they were made under the provisions of the divorce decree, they were installment payments, and were not deductible by George and Mauzella, and were not includible in the income of Glendora and Marvin. On the other hand, if they were periodic payments made by George to Glendora, they were deductible by George, and Glendora should have included them in her tax returns for those years.

As we have heretofore stated, Judge Brown, on the rehearing after the remand by the Supreme Court of Oklahoma in the first appeal, in his memorandum set out in Note 1, clearly and explicitly held that it was not the intent of the parties to modify the provisions of the divorce decree with respect to alimony payments.

Darrell joined the armed forces of the United States on January 22, 1969. Beginning in January 1965, up to the date of the trial in the Tax Court on February 28, 1972, George paid Glendora $250 per month, to and including January 1969, and thereafter, $400 per month.

For the years 1966 and 1967, the Commissioner entered statutory notices of deficiencies both to George and Glendora, in which he took inconsistent positions. He held in the deficiency notice to George that the alimony payments made to Glendora were not periodic payments, and were not deductible by George and Mauzella. In the deficiency notice to Glendora and Marvin, he took the position that the alimony payments made by George to Glendora were not installment payments and should have been included in the gross income in their income tax returns for 1986 and 1967.

George and Mauzella appealed from the decision of the Commissioner for the deficiency declared against them, and Glendora and Marvin appealed from the deficiency declared against them. The appeals were consolidated for hearing in the Tax Court. It held that such payments made by George to Glendora were installment payments, and were not deductible by him and Mauzella in their tax returns for 1966 and 1967, and that such payments were not periodic payments and should not be taxed against Glendora and Marvin in those years.

Counsel for George and Mauzella, disregarding the fact that Judge Brown by a final order had adjudged that the alimony agreement in nowise modified the provisions of the divorce decree with respect to alimony and the payment thereof, and that such provisions remained in full force and effect; and the further fact that we must therefore look to the provisions of the divorce decree to determine whether the alimony payments made by George to Glendora, both before and after January 1965, were installment payments, made the following contention :

They assert that had Darrell died before he was emancipated or reached the age of 21, the provision for the payment of $400 per month, in order to estop Glendora from citing George for contempt, would never have come into effect, and that the payment of $250 per month by George, in order to estop Glendora from citing him for contempt, would not have completed the payment of the unpaid balance of the alimony on January 1, 1965, of $38,050, until more than 10 years after January 1, 1965. The provisions of the alimony agreement with respect to payments, read literally and out of context and without consideration of the surrounding facts and circumstances, afford some basis for such construction of the alimony agreement. But, read in the light of the entire agreement, the provision in the divorce decree that George would pay Glendora $150 per month for the support of each of the three children, of whom Darrell was the youngest; the statements made by George and Glendora at the rehearing, and particularly Glendora’s statement that “he would only have to pay $250 per month until his child support stopped,” at which time he would start paying $400 per month, negate the contention of counsel for George and Mauzella, and show that the parties intended by the provisions of the alimony agreement that George should begin the payment of $400 per month whenever his obligation to pay Glendora $150 per month for the support of Darrell ceased for any reason.

However, we are of the opinion that the contention made by counsel for George and Mauzella is wholly immaterial to a proper decision in the instant case. To hold otherwise would accord George the right to modify the divorce decree by reason of the provisions in the alimony agreement. But, as we have heretofore said, Judge Brown in his memorandum, set out in Note 1, concluded that the alimony agreement did not change or modify in any way the provisions of the divorce decree with respect to alimony or the payment thereof, and entered a final order giving effect to such conclusion. Hence, George had no power to change such provisions in the divorce decree.

We agree with the holding of the Tax Court in the case of Grabowski v. Commissioner, 21 T.C.M. 249, 251, where, in construing 26 U.S.C.A. § 71(c)(2), it said:

“The word ‘may’ in the phrase ‘may be paid’ relates to the decree and it is to be given its ordinary permissive meaning as distinguished from ability, possibility, or what is likely to occur. The question is whether the decree by its terms permits installment payments of the principal sum so that the husband would be complying with the terms of the decree if he extended the payments beyond the 10 year period. If it does not, then the installment payments are not includible in the wife’s income, even though it appears uncertain whether the husband will, or will be able to, make the payments within the 10 year period. In deciding whether the principal sum ‘may be paid’ within 10 years, the possibility of noncompliance with the terms of the decree is not recognized. Robert D. Stecker, * * * [31 T.C. 749 (1959)]. In short, the issue is whether the decree grants Felix [the husband] the right to extend the installment payments on the principal sum of $23,500 beyond the 10 year period."

We think the above-quoted language of the Tax Court is apposite in the instant case.

Under the alimony agreement, George was required to pay not less than $250 per month from January 1, 1965, to January 22, 1969, and $400 per month thereafter until the alimony was fully paid, to avoid being cited for contempt for not paying $350 each month from the date of the divorce decree. However, under the terms of the divorce decree, which were in nowise changed by the alimony agreement, he was required to pay $350 each month from the date of such decree until the alimony was fully paid. Hence, he was required by the terms of the divorce decree to pay the alimony in full within 119 months from the date of the divorce decree, and he “would” not “be complying with the terms of the” divorce “decree if he extended the payments beyond the 10 year period,” which he had no right to do. And, if instead of paying Glendora $250 per month during the period from January 1, 1965, to January 22, 1969, he had paid her $350 per month, as he was required to do by the terms of the divorce decree, and $400 per month after the latter date, which he had to do to avoid being cited for contempt, he would have paid the alimony in full in 119.25 months, or within less than 10 years from the date of the decree.

We hold that all of the payments made by George, both before and after January 1, 1965, were installment payments made under the provisions of the divorce decree, and that George and Mauzella were not entitled to deduct the payments made by George to Glendora in 1966 and 1967 from their gross income for those years.

The decision of the Tax Court is affirmed.

      . “(1) The voluntary appearance of the parties and their consent for the Court to hear the matter conferred jurisdiction upon the Court to modify their 1963 Decree.
      “(2) However, neither party requested the Court in any way, manner, method or detail, to modify that Decree or its alimony award, nothwithstanding [sic] any implication to the contrary from the ineptly worded ‘Alimony Agreement’ of 12-10-64.
      “(3) The parties appeared and asked that their agreement be approved only because of the financial pressures produced by repetitive contempt citations.
      “(4) Defendant specifically agreed that his alimony obligation continued to accrue at the rate of $350.00 per month, but he acknowledged understanding that if the Court approved their Agreement, he would only have to pay $250.00 per month until his child support stopped, at which time he would start paying $400.00 per month, which was more than required under the 1963 Decree.
      “(5) Plaintiff specifically stated that while she knew her alimony was accumulating at the rate of $350.00 per month, she was agreeing to give up any right to coerce payment through contempt proceedings or execution of more than $250.00 per month until the child support stopped, when she could expect $400.00 per month toward retirement of the accrued and accruing alimony due her.
      “Therefore, the Court concludes that it was not the intention of the parties or of the Court to modify the alimony award contained in the 1963 Divorce Decree of these parties, but that it was the announced intention of the parties and Order of the Court to estop the plaintiff from enforcing the collection through contempt of more than $250.00 per month until majority or emancipation of the child, when defendant would pay $400.00 per month. While this appears in retrospect to be a poor method of accomplishing the desired result, such is what happened.”

      . A copy of such mandate duly certified was furnished us by counsel for Glendora Wallace Young on August 8, 1973.


author: WIDENER, Circuit Judge:

text:
    Fred PAINTER, Appellant, v. William D. LEEKE, Director, Department of Corrections, Appellee.
    No. 72-2090.
    United States Court of Appeals, Fourth Circuit.
    Argued June 6, 1973.
    Decided Oct. 15, 1973.
    Randy S. Gregory and George B. Hyler, Third Year Students (George K. Walker, Winston-Salem, N. C. [Court-appointed] on brief), for appellant.
    Robert M. Ariail, Asst. Atty. Gen. of S. C. (Daniel R. McLeod, Atty. Gen. of S. C., and Emmet H. Clair, Asst. Atty. Gen., on brief), for appellee.
    Before WINTER and WIDENER, Circuit Judges, and KAUFMAN, District Judge.
   WIDENER, Circuit Judge:

In this appeal from the denial of a petition for writ of habeas corpus, the question is whether or not the manner of conducting the trial deprived the defendant of procedural due process. We are of opinion that the defendant did not receive a fair trial and we reverse.

On October 1, 1968, prisoners at the South Carolina Central Correctional Institution rioted. Twelve prisoners, including Painter, were indicted for rioting in prison, possessing weapons which might be used to facilitate an escape, and assault and battery of a high and aggravated nature. The twelve prisoners were to be tried together on December 9, 1968. At the beginning of the trial, four of the twelve prisoners pleaded guilty; two others did so during the course of the trial; and Painter and five other prisoners maintained their pleas of not guilty. The trial lasted five days. Before the case went to the jury, the charges of assault and battery against the six prisoners who remained on trial were dismissed by the court. The jury returned a verdict against Painter and the five other prisoners on the rioting charges. It also found Painter and the others, except one, Downing, guilty of possession of weapons with which to facilitate an escape.

Painter and the five other inmates convicted by the jury appealed to the South Carolina Supreme Court, contending that various errors were committed by the trial court. The convictions were affirmed by a 3-2 decision, sub nom. State v. Greene, 255 S.C. 548, 180 S.E.2d 179 (1971). Subsequently, Painter filed his petition for a writ of habeas corpus in the district court, which denied relief.

At the beginning of the criminal trial, the following colloquy took place between Painter's counsel and the trial judge.

“Mr. Williams (Painter’s attorney): If your Honor please, before we draw the Jury, I would like to make some motions — •
The Court: I’m going to let you make all the motions you want to and I’m going to mark them heard and then let you reduce them to writing and put them in the record. Note every kind of motion that they want to make and mark them heard and overruled.
Mr. Williams: But one motion may— Solicitor Ford (State prosecutor): I’ll take care of that one. I ask to have the Jury put on their voir dire. If your Honor please, we are ready.”

In Painter’s appeal to the South Carolina Supreme Court, the State conceded that the motions which Painter claimed to have been erroneously denied by the trial court would have been presented at the appropriate stages of trial and in the appropriate manner had the trial court not refused to allow his defense counsel to make them to the court. State v. Greene, supra, -180 S.E.2d at 182-183. There is no contention that the motions were frivolous. The motions which would have been presented to the trial court had it not refused to allow defense counsel to be heard were:

“(a) Motion for continuance on behalf of defendants;
(b) Motion for a severance of defendants;
(c) Motion to quash the Indictment because of the unconstitutional vagueness of the statute upon which it was based;
(d) Motion that guilty pleaders be sentenced before continuance of trial;
(e) Motion that guilty pleaders be excused from the courthouse; and
(f) Motion for an arrest of judgment or, in the alternative, for a new trial.” State v. Greene, supra, 180 S.E.2d at 182-183.

Painter contends here that the State trial court committed various errors during the course of his trial which amount to a deprivation of procedural due process. One of these alleged errors is that he was denied a fair trial because the trial judge refused to allow his counsel to make any motions to the court, either before or during the trial. The judge told Painter’s counsel to put his motions in the record and then instructed the court reporter to mark them heard and overruled. Consistent with this ruling, the judge not only-heard no argument on the motions, he did not even allow them to be stated, and passed upon them in advance without knowing what they were.

In Estes v. Texas, 381 U.S. 532, 542, 85 S.Ct. 1628, 1632, 14 L.Ed.2d 543 (1965), the Supreme Court addressed itself to the issue of a fair trial. There the court said:

“It is true that in most cases involving claims of due process deprivations we require a showing of identifiable prejudice to the accused.. Nevertheless, at times a procedure employed by the State involves such a probability that prejudice will result that it is deemed inherently lacking due process. Such a case was In re Murchison, 349 U.S. 133, [75 S.Ct. 623, 99 L.Ed. 942] (1955), where Mr. Justice Black for the Court pointed up with his usual clarity and force:
‘A fair trial in a fair tribunal is a basic requirement of due process. Fairness of course requires an absence of actual bias in the trial of cases. But our system of law has always endeavored to prevent even the probability of unfairness. . . . [T]o perform its high function in the best way “justice must satisfy the appearance of justice”. Offutt v. United States, 348 U.S. 11, 13, [75 S.Ct. 11, [99 L.Ed. 11]].’ At 136 [75 S.Ct. at 625] (Emphasis supplied.) [by the Supreme Court]
“And, as Chief Justice Taft said in Tumey v. State of Ohio, 273 U.S. 510, [47 S.Ct. 437, 71 L.Ed. 749], almost 30 years before:
‘The requirement of due process of law in judicial procedure is not satisfied by the argument that men of the highest honor and the greatest self-sacrifice could carry it on without danger of injustice. Every procedure which would offer a possible temptation to the average man ... to forget the burden of proof required to convict the defendant, or which might lead him not to hold the balance nice, clear, and true between the state and the accused denies the latter due process of law’. At 532 [47 S.Ct. at 444]. (Emphasis supplied.)” [by the Supreme Court] 381 U.S. at 542-543, 85 S.Ct. at 1632-1633.

In Morrissey v. Brewer, 408 U.S. 471, 489, 92 S.Ct. 2593, 33 L.Ed.2d 484 (1972), the Supreme Court held that a parolee was entitled to a hearing, however informal, before an impartial hearing officer before his parole could be revoked. In discussing the procedure to be followed at such a revocation hearing, the court said that certain minimum requirements of due process had to be met. One such requirement, said the court, was the parolee’s opportunity to be heard.

In Specht v. Patterson, 386 U.S. 605, 87 S.Ct. 1209, 18 L.Ed.2d 326 (1967), the court held that the Colorado Sex Offenders Act was deficient in due process when measured.by the requirements of the Fourteenth Amendment. In discussing what would be required to meet the due process standard, the court said:

“Due process, in other words, requires that he [the defendant] be present with counsel, have an opportunity to be heard, be confronted with witnesses against him, have the right to cross-examine, and to offer evidence of his own. And there must be findings adequate to make meaningful any appeal that is allowed.” 386 U.S. at 610, 87 S.Ct. at 1212.

In Lane v. Warden, Maryland Penitentiary, 320 F.2d 179 (4th Cir. 1963), we said that constitutional due process required a fair hearing in a fair tribunal. In holding that informing the jury of prior convictions at the outset of a trial was a deprivation of due process, we held that such denial, depriving the defendant of a fair trial, would render a conviction void and that appropriate relief was within the reach of habeas corpus.

The cases cited amply demonstrate that a person threatened with a deprivation of his liberty, by virtue of a criminal trial, is entitled to an orderly procedure which affords him a fair trial. Due process demands no less. An essential element of a fair trial is a fair hearing where the accused has an opportunity to be heard, and the failure to give the accused such hearing will invalidate the result.

In the present case, the trial judge, at the beginning of the trial, refused to allow Painter’s counsel to make any motions to the court. Instead, he instructed that all such motions should be put in the record and marked heard and overruled. In the dissenting opinion in State v. Greene, supra, Mr. Justice Bussey commented on such procedure. He said:

“Appellants were entitled to have the motions for continuance and severance fully heard by the trial judge and thereafter entitled to a timely disposition of the same in his sound judicial discretion. This they have not received, according to the record. The merits of these motions have been argued before us, but we should refrain from passing upon the merits. We cannot speculate as to what conclusions His Honor might have reached had he timely and fully heard the motions, let alone determine whether or not the conclusions which he might have reached would have constituted an abuse of discretion. The appellants simply did not receive a judicial consideration of the motions to which they were entitled. The right to have these motions heard was a substantial right, and, under the facts of this case, its denial was reversible error.” 180 S.E.2d at 189.
* * *• -x- * -x-
“Being convinced that the appellants did not receive a fair trial, I would reverse the judgment below, and remand for a new trial as to all defendants.” 180 S.E.2d at 190.

We are in agreement with the result reached by Mr. Justice Bussey. We are of opinion that Painter was denied his opportunity to be heard when the trial judge refused to allow his counsel to make any timely, non-frivolous motions of arguable merit.

Since we think a new trial is required, we do not reach the other questions raised on appeal, and hold only that, in a criminal trial, a fair trial requires that the accused be given an opportunity to make appropriate nonfrivolous motions, at appropriate times under State procedural rules, and that the trial court may not deny the accused this right without depriving him of due process of law. U.S.Const. Amendments V, XIV. Cf. United States v. Williams, 447 F.2d 894, 902 (5th Cir. 1971).

Accordingly, we must reverse the judgment of the district court and remand the ease with instructions that the writ of habeas corpus issue, subject to the State’s right to re-try Painter within a reasonable time.

Reversed and remanded.


author: EDWARDS, Circuit Judge. WEICK, Circuit Judge

text:
    Andrew GREEN, Individually and as next friend of Tammy K. Green, a minor, Plaintiff-Appellant, v. VOLKSWAGEN OF AMERICA, INC., Defendant-Appellee.
    No. 72-2224.
    United States Court of Appeals, Sixth Circuit.
    Argued April 16, 1973.
    Decided Oct. 12, 1973.

      Eugene Field, Kalamazoo, Mich., for plaintiff-appellant.
    Ronald R. Pawlak, Southfield, Mich., for defendant-appellee.
    Before WEICK, EDWARDS and McCREE, Circuit Judges.
   EDWARDS, Circuit Judge.

Plaintiff-appellant’s cause of action on behalf of his minor daughter was dismissed on motion for summary judgment by the United States District Court for the Western District of Michigan.

Appellant’s brief complaint stated that his daughter, Tammy, then 11 years old, had lost a finger when she was “passing the left rear body panel of said automobile, her right ring finger became caught in a body vent where a sharp concealed piece of metal severed her finger through the proximal phalanx.”

The complaint also alleged that defendant was the United States sales subsidiary for Volkswagen A. G. of Germany, engaged in distributing automobiles “in particular, a 1956 Volkswagen Bus, vehicle #180093,” and that “the said automobile was not merchantable and fit for the general purpose for which it was manufactured and sold, in that the automobile had been manufactured with dangerous and defective body vents.”

Defendant filed an answer which denied any defect in the vehicle and asserted that “plaintiff’s complaint fails to state a cause of action against this defendant.”

The relevant facts before the court were supplemented by plaintiff’s affidavit saying:

“NOW COMES Andrew Green, plaintiff in the instant action who says that the Volkswagen involved was parked three spaces back from the sidewalk in a parking lot adjacent to his home and had remained motionless in such position for about one month.
“Deponent further says that the left rear body vents of said Volkswagen were defective, hazardous and dangerous in that the edges of the openings were so pressed or formed that they had sharp knife-like cutting edges which condition was concealed from view.”

Tammy’s deposition had also been taken as to how the accident happened. It indicated that on the date in question she had been playing ball with her little brother on a parking lot next to her house where the Volkswagen bus was parked:

* * * -* * x-
“A. Well, I threw the ball to my little brother, and he went and ran and I tried to catch him, and I ran by the bus and I slipped and fell and it got caught in there.
* * -X- x- X x-
A. And he ran around the house, our neighbor’s house, and I went after him, and I ran by the bus and got my finger caught in the vent.
Q. Now you were running and you say you slipped and you fell? A. Yeah, after I got it caught in the vent.
Q. Well, did you slip and fall against the vent ?
A. No. I slipped right along the side of it, of the truck.
Q. All right, you were running, and you got near the truck?
A. Yeah.
Q. As you got near the truck, did you start to slip ?
A. No. That was after I got my finger caught in the vent.
Q. How did you come in contact with the truck? That is what I can’t quite figure out.
A. I don’t know.
Q. You mean you got your hand up against the truck some way or the bus in some way ?
A. Yeah.
Q. How did you do that? Was it because you were falling? Was that it?
A. No. I was just running by. I didn’t even start to fall until after my finger got caught in the vent.
Q. You caught your finger in the vent and then you started to fall?
A. Yeah.
Q. I see. Now looking at this picture, could you tell me in which one of those vents you caught your finger in? I know it might be hard for you to remember, but do you have any idea at all?
A. No.”

The District Judge in granting defendant’s motion for summary judgment held:

“The court concludes as a matter of law that plaintiff, as the facts reveal in this case, used the Volkswagen in a manner unintended by the manufacturer. While the court recognizes that a product may have more than one use, and conceivably a Volkswagen bus, by its nature and physical makeup, offers several uses, plaintiff here did not use the Volkswagen bus in a manner which would entitle her to claim that the bus was therefore not reasonably fit for the purposes for which she used it.”

This action is within the federal court’s jurisdiction solely because of diversity of citizenship and, hence, we apply. Michigan law. In a series of cases starting in 1958, the Michigan Supreme Court abolished the defense of privity in products liability cases where the complainant relied upon an implied warranty. Spence v. Three Rivers Builders & Masonry Supply, Inc., 353 Mich. 120, 90 N.W.2d 873 (1958); Mazoni v. Detroit Coca-Cola Bottling Co., 363 Mich. 235, 109 N.W.2d 918 (1961); Piercefield v. Remington Arms Co., 375 Mich. 85, 133 N.W.2d 129 (1965).

In the last case (involving a claim of defect in a shotgun cartridge), the Michigan Supreme Court made it clear that the Michigan concept of products liability extended not only to a subsequent purchaser of the alleged defective product, but also to an injured third party bystander:

Spence v. Three Rivers Builders & Masonry Supply, Inc., 353 Mich. 120, 90 N.W.2d 873; Manzoni v. Detroit Coca-Cola Bottling Co., 363 Mich. 235, 109 N.W.2d 918; Barefield v. LaSalle Coca-Cola Bottling Co., 370 Mich. 1, 120 N.W.2d 786, and Hill v. Harbor Steel & Supply Corp., 374 Mich. 194, 132 N.W.2d 54, have put an end in Michigan to the defense of no privity, certainly so far as concerns an innocent bystander injured as this plaintiff pleads, and that a person thus injured should have a right of action against the manufacturer on the theory of breach of warranty as well as upon the theory of negligence. Piercefield v. Remington Arms, supra at 98, 133 N.W.2d at 135.

It is not beyond foreseeability for the distributor (and the manufacturer) to have known that this Volkswagen bus would on many occasions be used for parking where children were playing. See Larsen v. General Motors Corp., 391 F.2d 495 (8th Cir. 1968). Under Piercefield we have no doubt that defendant in this case did owe a duty not to sell a product which it knew (or should have known) to be defective so as to pose a hazard to a child who came in contact with it while playing in its vicinity.

The most succinct statement of Michigan’s products liability law is contained in the American Coupling ease:

The court instructed the jury as follows:
“To recover, the plaintiff, Mr. Heekel, must show * * * the following things. Number one, * * * that there was a defect in .the hose assembly when it left the manufacturing plant of the defendant.
“And he must also show that the defect was a proximate cause of the injury in this case. * * * ”
The substance of that charge was repeated a number of times in the judge’s instructions. It constitutes a correct and proper statement of the law with respect to liability for breach of implied warranty and what plaintiff must prove to be entitled to recover under that theory. Piercefield v. Remington Arms Company, Inc. (1965), 375 Mich. 85, 133 N.W.2d 129; Manzoni v. Detroit Coca-Cola Bottling Company (1961), 363 Mich. 235, 109 N.W.2d 918; Rex Paper Company v. Reichhold Chemicals, Inc. (W.D.Mich.1966), 252 F.Supp. 314; Barefield v. LaSalle Coca-Cola Bottling Company (1963), 370 Mich. 1, 120 N.W.2d 786. As defendant says in his brief, all of these cases stand for the proposition that there must be a defect attributable to the manufacturer and a causal relationship between that defect and the injury complained of in order for there to be recovery on implied warranty. Heckel v. American Coupling Corp., 384 Mich. 19, 21-22, 179 N.W.2d 381, 383 (1970).

Of course, the proof of “a defect” requires proof that the defect existed at the time the product left the possession of the manufacturer. It also requires proof that the nature of “the defect” was such that the manufacturer under the reasonable man standard could have foreseen that someone might be injured thereby.

These issues, however, are issues of fact and under Michigan law are for jury determination. Crowther v. Ross Chemical Co., 42 Mich.App. 426, 202 N.W.2d 577 (1972); Garmo v. General Motors Corp., 45 Mich.App. 703, 207 N.W.2d 146 (1973). In the Ross Chemical case a father whose two daughters had been murdered by a glue sniffer brought suit against the manufacturer of the airplane glue involved. Plaintiff claimed the product was not safe for public use, asserting both design defect and failure to warn concerning the hazards of glue-sniffing. The Michigan Court of Appeals held that a motion for summary judgment had properly been denied and that the issue of expectability (foreseeability) of the use alleged was an issue of fact for the jury.

In our instant case likewise we think summary judgment is inappropriate. Whether Tammy’s “use” of this Volkswagen was expectable or foreseeable was a jury question under Michigan law. Clearly, as we have shown above, no chain of title or permission to use is required under Michigan law. In a diversity case we are required to follow the applicable state law. Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938).

The dissent implies that this opinion holds that under Michigan law a parked automobile is a dangerous instrumentality or that a distributor of an automobile is the insurer of the safety of all persons who may come in contact with it. Neither of these holdings is to be found in Michigan law nor in this opinion.

The actual issue in this case concerns whether or not under Michigan law plaintiff has a right to a jury trial. The dissent would deny that right. We believe, on the contrary, that under Michigan law plaintiff has the right to present evidence to a jury on the claims that Tammy’s injuries were (1) caused by a defect in the Volkswagen bus (2) which defendant knew or should have known existed at the time it put the bus in commerce (3) which defect defendant knew or should reasonably have known might cause the type of injury which Tammy suffered and (4) which was in fact a proximate cause of her injury. Under Michigan law all of these issues are jury issues unless there are no disputed facts or inferences.

The dissent’s primary reliance is upon the law of states other than Michigan. We are aware that this case might be decided differently under the law of other states. But Michigan has taken a strong position against disposing of negligence cases on motions for summary judgment.

Two authoritative commentators on Michigan law have expressed the matter thus:

In negligence cases, even though there may be no dispute as to the quantitative or physical facts, summary judgment will almost always be inappropriate because the qualitative issue of whether defendant exercised reasonable care will be in dispute and must be left for the jury, unless on the undisputed physical facts a judge would say that a directed verdict would be required — which is to say that there really is no negligence issue for the jury. In such cases summary judgment has been allowed in negligence cases and should be.

1 J. Honigman & C. Hawkins, Michigan Court Rules Annotated 360 (1962).

In one of the two Michigan cases relied upon by the dissent the opinion for the court said:

A reading of opinions of this Court written during the past 15 years may suggest that a majority of the Court as from time' to time constituted, has viewed with disfavor the granting by trial courts of summary judgments for defendants in negligence eases. In the instant case, however, not a controverted question of fact is presented by the pleadings which, if resolved in plaintiff’s favor, would entitle him to judgment against defendant.

Fisher v. Johnson Milk Co., Inc., 383 Mich. 158, 174 N.W.2d 752 (1970). In Miller v. Miller, 373 Mich. 519, 524, 129 N.W.2d 885, 887 (1964), the court said:

“As a general rule, it can not be doubted that the question of negligence is a question of fact and not of law”. Detroit & Milwaukee R. Co. v. Van Steinburg, 17 Mich. 99, 118.
It is because the question of negligence is a question of fact and not of law and because its existence depends upon conformance with or violation of standards of behavior peculiarly within the special province of a jury to determine, that the summary judgment procedures of GCR 1963, 117.-2(3), rarely will be applicable to a common-law negligence case. Exceptions, of course, may be found — such as where no duty of care can be proved. In such circumstances, assuming there “is no genuine issue as to any material fact” relevant to the existence of an asserted duty, the trial court may determine as a matter of law that no cause for action exists. But this is not such a case.

In Byrnes v. Economic Machinery Co., 41 Mich.App. 192, 201, 200 N.W.2d 104 (1972), the court made this comment on the question of foreseeable use or misuse:

A manufacturer has a duty to use reasonable care in designing his product to guard against an unreasonable and foreseeable risk. Gossett v. Chrysler Corp., 359 F.2d 84 (CA 6, 1966); Farr v. Wheeler Manufacturing Corp., 24 Mich.App. 379, 180 N.W.2d 311 (1970); Harper & James, The Law of Torts (1956), § 28.5, pp. 1543, 1545. This may even include misuse which may be reasonably anticipated. See Brown v. General Motors Corp., 355 F.2d 814, 820 (CA 4, 1966); Marker v. Universal Oil Products Co., 250 F.2d 603, 606 (CA 10, 1957). (Emphasis added).

In Beardsley v. R. J. Manning Co., 2 Mich.App. 172, 175, 139 N.W.2d 129, 130 (1966), the Michigan Court of Appeals reversed a summary judgment stating:

It is, of course, axiomatic that a summary judgment or decree will not be upheld where there are material issues of fact raised on the pleadings. Kaminski v. Standard Industrial Finance Co. (1949), 325 Mich. 364, 38 N.W.2d 870. Any inferences to be drawn from the underlying facts pleaded or contained in the counter affidavit must be viewed in the light most favorable to the party opposing the motion.

See also Sparks v. Luplow, 372 Mich. 198, 125 N.W.2d 304 (1963); Anderson v. Gene Deming Motor Sales, Inc., 371 Mich. 223, 123 N.W.2d 768 (1963); Tacie v. White Motor Co., 368 Mich. 521, 118 N.W.2d 479 (1962); Killen v. Benton, 1 Mich.App. 294, 136 N.W.2d 29 (1965).

The judgment of the District Court is vacated and the case is remanded for further proceedings.

WEICK, Circuit Judge

(dissenting).

The decisions of the Courts of the State of Michigan, in my judgment,'cannot be read as holding that an automobile is a dangerous instrumentality, or that the manufacturer or distributor of an automobile is an insurer of the safety of, and is liable for injuries to, all persons who may come in contact with it, including those persons who may misuse it.

In my judgment the Court’s opinion does not comport with Michigan law, nor with prior decisions of this Court, and is contrary to the general rule on the subject of products liability.

The automobile involved in this case was a Volkswagen bus of the vintage of 1956. At the time of the accident it was sixteen years old. The owner of the VW bus had parked it lawfully in a parking lot, where it had remained standing for more than a month, and it was not in operation at the time plaintiff ran into the left rear side of it, in broad daylight.

Plaintiff, an 11-year-old girl, was playing with her little brother in the parking lot. She threw a ball to him, and then ran after him. As she ran along the side of the bus she caught her right ring finger inside the air vent for the motor, which vent was located near the rear of the bus. Her finger was severed through the proximal phalanx. Her complaint, in which she demanded judgment against the defendant in the amount of $200,000, alleged that the cutting of her finger was caused by “a sharp concealed piece of metal.” She did not know how she happened to come in contact with the bus. In her deposition plaintiff testified:

“Q. How did you come in contact with the truck? That is what I can’t quite figure out.
A. I don’t know.
Q. You mean you got your hand up against the truck some way or the bus some way?
A. Yeah.
Q. How did you do that? Was it because you were falling? Was that it?
A. No. I was running by. I didn’t even start to fall.”

There was no claim that the vent protruded from the side of the bus. It is clear that plaintiff’s injury to her finger was caused by the child’s insertion of her finger inside the vent itself.

The Michigan Court of Appeals, in Farr v. Wheeler Mfg. Corp., 24 Mich. App. 379, 386, 180 N.W.2d 311, 315 (1970), adopted our statement as to the rule for design liability. The Court said:

“Gossett v. Chrysler Corporation (CA 6, 1966), 359 F.2d 84, 87, set forth the rule for design liability:
‘It is the duty of a manufacturer to use reasonable care under the circumstances to so design his product as to make it not accident or foolproof, but safe for the use for which it is intended. This duty includes a duty to design the product so that it will fairly meet any emergency of use which can reasonably be anticipated. The manufacturer is not an insurer that his product is, from a design viewpoint, incapable of producing injury.’ ” (Emphasis added)

In Fisher v. Johnson Milk Co., 383 Mich. 158, 174 N.W.2d 752 (1970), the Court quoted Campo v. Scofield, 301 N. Y. 468, 95 N.E.2d 802 as follows:

“ ‘If the manufacturer does everything necessary to make the machine function properly for the purpose for which it is designed, if the machine is without any latent defect, and its functioning creates no design or peril that is not known to the user, then the manufacturer has satisfied the law’s demands. We have not yet reached the state where a machine is accident proof or foolproof. . . . ’ ”

The Court further quoted from Stevens v. Durbin-Durco, Inc., 377 S.W.2d 343 (Mo.1964), as follows:

“ ‘Since practically any product, regardless of its type or design, is capable of producing injury when put to particular uses, a manufacturer has no duty so to design his product to render it wholly incapable of producing injury. . . .’”

The Court further approved and quoted at length from Jamieson v. Woodward & Lothrop, 101 U.S.App.D.C. 32, 247 F.2d 23 (1957).

The District Judge in the present case held that the child’s use of the bus was not for the purpose for which it was intended.

The Courts generally have denied liability in cases factually similar to the case at bar.

In Hatch v. Ford Motor Co., 163 Cal.App.2d 393, 329 P.2d 605 (1958), a 6-year-old child walked into the radiator ornament of a parked automobile. The ornament pierced the child’s eyeball, causing loss of the eye. The Court hel'd as a matter of law that the defendant was not required to anticipate or foresee and guard against the risk of such an injury. The Court said:

“If, in the present case, the minor plaintiff had stumbled as he approached the vehicle and struck his face against a headlight lens causing it to fracture and lacerate his eye, the question of duty to make the vehicle safe to collide with would be clearly presented under a claim that if the headlight lens had been made of safety glass the plaintiff would not have lost his eye; or, if the plaintiff had collided with the side of the car and his eye been impaled upon a radio antenna which had been telescoped so that its point protruded but a few inches above the body of the car, again the claim might be made that this created a danger which might have been avoided by enclosing the radio antenna within the body of the car so as not to protrude therefrom. In other words, each case in which a person collided with a standing vehicle and received some injury from a part of the vehicle which injury he might not have sustained had the vehicle been constructed in some other manner would raise a question of fact as to whether the manufacturer was liable to that person. In effect the triers of the facts would be the arbiters of the design of automobiles and the standard of design would be determined not when the automobile was manufactured but after the occurrence of an accident.” (329 P.2d at 607-608).

In Kahn v. Chrysler Corp., 221 F.Supp. 677 (S.D.Tex.1963), a 7-year-old boy rode his bicycle into the rear of a 1957 Dodge vehicle, striking his head against the left rear fin of the vehicle. He alleged negligence in designing the fin “in such a manner that the fins of said vehicle were elongated and protruded past the remainder of the vehicle and made of sharp metal capable of cutting.” The Court granted summary judgment in favor of defendant. It found no Texas authority dealing with the precise question. It cited and followed the rule in Hatch, supra. The Court said:

“Chrysler Corporation should not be required to anticipate all the possible ways in which a person may injure himself by falling against an automobile, nor should they have a duty to protect against such possible injuries. The duty of the automobile manufacturer extends to the ordinary use of the vehicle, and may even be such as to cover certain situations when the automobile is being negligently used. But the manufacturer has no obligation to so design his automobile that it will be safe for a child to ride his bicycle into it while the car is parked.” (221 F.Supp. at 679).

In Schneider v. Chrysler Motors Corp., 401 F.2d 549 (8th Cir. 1968), the plaintiff recovered a verdict and judgment of $40,000, for injuries to his right eye, which injuries were sustained when his eye came into contact with the left front window vent in his 1960 Valiant automobile. The left window vent had a microscopic cutting surface not present on the right window vent. The District Court granted judgment for Chrysler notwithstanding the verdict, both on the issues of negligence and implied warranty. The Appellate Court (Judges Black-mun, Mehaffy and Gibson) affirmed, citing and quoting from Hatch.

The standard of safety of goods is the same under the warranty theory as under the negligence theory. 2 Harper & James, The Law of Torts, § 28.22, p. 1585 (1956).

Comment “h” to restatement (second), torts, § 402 A (1965) states:

“A product is not in a defective condition when it is safe for normal handling and consumption.”

In the present case the bus was safe for normal handling and usage.

In Evans v. General Motors Corp., 359 F.2d 822 (7th Cir. 1966), the Court held:

“A manufacturer is not under a duty to make his automobile accident-proof or fool-proof; nor must he render the vehicle ‘more’ safe where the danger to be avoided is obvious to all. Campo v. Scofield, 1950, 301 N.Y. 468, 95 N.E.2d 802, 804. Perhaps it would be desirable to require manufacturers to construct automobiles in which it would be safe to collide, but that would be a legislative function, not an aspect of judicial interpretation of existing law. Campo v. Scofield, supra, 805.” (Id. at 824).

In Burkhard v. Short, 28 Ohio App.2d 141, 275 N.E.2d 632 (1971), the Court held:

“A manufacturer of automobiles has no duty to a passenger injured by contact with an obviously unpadded cowl which could have been made ‘safer’ by padding and by recessing the same.” (Syl. 2)

The Ohio Appellate Court relied on Gossett v. Chrysler Corp., 359 F.2d 84 (6th Cir. 1966), Evans (supra) and Kahn (supra), and also cited the decision of Chief Judge Weinman in Shumard v. General Motors Corp., 270 F.Supp. 311 (D.C.1967), holding that—

“No duty exists to make an automobile fireproof, nor does the manufacturer have to make a product which is ‘accident proof’ or ‘fool proof.’ ”

In Warner v. Kewanee Mach. & Conveyor Co., 411 F.2d 1060 (6th Cir. 1969), cert. denied, 398 U.S. 906, 90 S.Ct. 1685, 26 L.Ed.2d 65 (1970), (a Michigan case) this Court held in an opinion written by Judge Peck, that the manufacturer of a portable farm elevator, used to load straw into a haymow, had no duty to adopt a design representing the ultimate in safety. The Court relied on Gossett, and held there was no proof of negligent design or violation of implied warranty.

In the present case, the part of the majority opinion most damaging to automobile manufacturers and distributors is that which erroneously extends the foreseeability doctrine to misusers of the automobile, for virtually every type of misuse is foreseeable; Hatch, supra, Evans, supra, Shumard, supra, and Schneider, supra.

As well stated by the Supreme Court of Illinois in Mieher v. Brown 301 N.E.2d 307 (Ill.1973), CCH Products Liability Rptr., jf 6972, in a case involving a collision of an automobile with the rear of a truck:

“The question in our case involves the duty of the manufacturer to design a vehicle with which it is safe to collide.”

In rejecting the application of the foreseeability rule, the Court said:

“[W]e do not believe . . . that the foreseeability rule applied in Larsen is intended to bring within the ambit of the defendant’s duty every consequence which might possibly occur. In a sense, in retrospect almost nothing is unforeseeable.’’ (Emphasis added).

The majority relied on Larsen v. General Motors Corp., 391 F.2d 495 (8th Cir. 1968), and Piercefield v. Remington Arms Co., 375 Mich. 85, 133 N.W.2d 129 (1965). Such reliance is misplaced, for neither one of these cases involved misuse of the product. In a later opinion, however, the Eighth Circuit, in Schneider v. Chrysler Motors Corp., 401 F.2d 549 (8th Cir. 1968), distinguished Larsen stating:

“In the Zahn, Larsen and Blitzstein [Blitzstein v. Ford Motor Co., 288 F.2d 738 (5 Cir.)] cases, the respective automobiles subjected their users to an unreasonable risk of harm when the automobiles were being used for the purpose intended; the accidents and resultant injuries were held foreseeable. In applying the doctrine of foreseeability the particular injury or precise form of the injury need not be perceived or foreseen, but if there is some probability of harm sufficiently serious that an ordinary reasonable person would take precautions to avoid it then failure to take such care is negligence. As reviewed in Swearngin v. Sears Roebuck & Company, supra, at 642 of 376 F.2d [637, 10 Cir.]:
‘ ->:• * * [I] t is generally held, regardless of whether the question of “foreseeability” is treated as a problem of “duty,” “negligence,” or “proximate cause,” that it is not necessary that the defendant might or should have foreseen the likelihood of the particular injury or harm, the extent of the harm, or the manner in which it occurred, but that it is only necessary that he should have anticipated that some injury or harm might result from his conduct. 100 A.L.R.2d 980; Rowell v. City of Wichita, 162 Kan. 294, 176 P.2d 590 (1947) and Atherton v. Goodwin, 163 Kan. 22, 180 P.2d 296 (1947) cited as authority.’
In the case at bar, the Valiant automobile was not being used for the purpose intended, and the left wing vent window, even if we assume that it has a microscopic cutting surface, did not present an unreasonable risk of harm. While it might not be incorrect to say that ‘but for’ the cutting surface on the left wing vent window Schneider would not have sustained a lacerated eyeball, such a statement does not serve to fix legal liability for Schneider’s unfortunate accident on the manufacturer; it is overstraining a manufacturer’s duty to foresee that individuals would inadvertently allow their eye to come in contact with the glass edge of a wing vent window on a parked automobile. A manufacturer is not an insurer and cannot be held to a standard of duty of guarding against all possible types of accidents and injuries. Standards of design and manufacturing skill must be consonant with the stage of the art and the risks to be avoided must be foreseeable.” [Footnotes omitted.] (Id. at 556-557).

Thus Larsen, as distinguished by the same Court, does not support the majority opinion here.

Piercefield involved a defective cartridge, which is a dangerous instrumentality, and as previously pointed out, Michigan Courts have not held that an automobile is a dangerous instrumentality.

In Piercefield the injury was to a bystander, and the primary issue was privity.

As well stated in Evans v. General Motors Corp., 359 F.2d 822 at 825 (7th Cir. 1966):

“The intended purpose of an automobile does not include its participation in collisions with other objects, despite the manufacturer’s ability to foresee the possibility that such collisions may occur. As defendant argues, the defendant also knows that its automobiles may be driven into bodies of water, but it is not suggested that defendant had a duty to equip them with pontoons.”

In referring to the dissent, the majority states:

“The actual issue in this case concerns whether or not under Michigan law the plaintiff has a right to a jury trial. The dissent would deny that right.”

The dissent would deny that right only where, as here, under the uneontroverted evidence there is no genuine issue as to any material fact.

The dissent relied on the most recent decision of the Supreme Court of Michigan on the subject of products liability. In Fisher v. Johnson Milk Co., 383 Mich. 158, 174 N.W.2d 752 (1970), summary judgment for the defendant was sustained. The Court stated:

“In the instant case, however, not a controverted question of fact is presented by the pleadings which, if resolved in plaintiff’s favor, would entitle him to judgment against the defendant.”

This is true here. There was not a single controverted issue of fact for a jury to determine. The only witness to the accident was the plaintiff, and her testimony has been detailed previously in this dissent. Taking her testimony as true, she cannot recover.

The majority cited and quoted from Byrnes v. Economic Machinery Co., 41 Mich.App. 192, 200 N.W.2d 104 (1972), wherein a mechanic, while working on a complex labelling machine, removed therefrom a safety guard, and when his right hand was in the machine his supervisor ordered the machine activated, resulting in injury to the mechanic. The Court had some difficulty in distinguishing Fisher v. Johnson Milk Co., supra, and the cases relied upon in Fisher. The Court then stated:

“We cannot agree with the contention that where a machine is subject to continual maintenance and an accident occurs during such maintenance, the machine is not being used as intended or that the misuse is unanticipated where the injured party takes no unnecessary risks in performing his job. Defendant knew that continual maintenance was necessary, and whether it had a duty to provide safeguards against foreseeable unreasonable risks which could occur while maintenance was taking place is a question for the trier of fact.” (41 Mich.App. at 201-202, 200 N.W.2d at 108).

Byrnes is thus distinguished from the case at bar because there the machine was being used for the purpose intended. In our case, the bus was not being used by the child for the purpose it was intended.

In discussing the matter of directed verdicts in negligence cases, the Supreme Court of Ohio in Peters v. B. & F. Transfer Co., 7 Ohio St.2d 143, 219 N.E.2d 27 (1966), held:

“Under our law it is just as pernicious to submit a case to a jury and permit the jury to speculate with the rights of citizens when no question for the jury is involved, as to deny to a citizen his trial by jury when he has the right.” (Syl. 8)

It is significant that the Court has not cited a single Michigan case wherein recovery was ever allowed against an automobile manufacturer to a person who was injured by running into the side of a standing automobile. The Michigan courts are fully capable of establishing the law of that state on products liability, and we are required to apply it. Erie R.R. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938).

While considerable progress has been made in recent years by the automotive industry in the development of safety standards, no one has yet come up with a design which would prevent injury to a person who runs into the side of a standing vehicle.

District Judge Engel followed Michigan law in holding that the “defendant is required to manufacture or supply a product reasonably fit for its intended use.’’ (Emphasis added). In granting the motion for summary judgment he held that under the uncontroverted evidence the plaintiff did not use the VW bus for its intended purpose. Fisher v. Johnson Milk Co., supra.

In my opinion the judgment of the District Court is correct and should be affirmed.

      . Defendant contends that plaintiff did not use the Volkswagen since the bus was parked. For the purposes of this motion, the court concludes, without deciding, that the bus was in fact “used” by plaintiff.

      . Larsen v. General Motors Corp., 391 F.2d 495 (8th Cir. 1968) distinguished by the same Court in Schneider v. Chrysler Motors Corp., 401 F.2d 549 (8th Cir. 1968).