Smith v. Lockheed Propulsion Co.
247 Cal.App.2d 774, 56 Cal. Rptr. 128, 29 A.L.R. 3d 538 (1967)
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Rule of Law:
Test firing a large rocket motor is an ultrahazardous activity for which the operator is strictly liable for resulting damages. A private contractor performing an ultrahazardous activity for the government is not entitled to share in governmental immunity from strict liability.
Facts:
- Since 1957, plaintiffs Smith owned 160 acres of land with a high-quality water well, which they were developing into a boys' camp.
- In 1961, Lockheed Propulsion Co. acquired 9,100 acres of adjacent land for the purpose of testing rocket motors.
- Lockheed unsuccessfully attempted to purchase the Smiths' property, with its counsel telling Smith, 'We have to have your land before we can test.'
- The Smiths expressed concern to Lockheed about potential damage to their property from a planned test, and Lockheed's counsel assured them that Lockheed would take care of any damage.
- On May 12, 1962, Lockheed conducted a static test firing of a 120-inch solid fuel rocket motor, the largest of its kind to date, which generated up to 350,000 pounds of thrust for 132 seconds.
- The test stand was located approximately 7,800 feet from the boundary of the Smiths' property.
- Plaintiff Smith felt a very strong vibration during the test, and 80 minutes after the test concluded, the water from their well turned muddy.
- An inspection later revealed that the well casing had been sheared at a depth of 95 feet, rendering the well permanently unusable, and a new well drilled by Lockheed failed to produce potable water.
Procedural Posture:
- Plaintiffs Smith sued defendant Lockheed Propulsion Co. in a California trial court on theories of negligence and strict liability.
- The case was tried before a jury.
- At the close of the plaintiffs' case, the defendant moved for a nonsuit.
- The trial court granted the defendant's motion for nonsuit, primarily on the ground that there was insufficient evidence of negligence and causation.
- Plaintiffs Smith, as appellants, appealed the judgment of nonsuit to the California Court of Appeal.
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Issue:
Is a private company that test-fires a large solid fuel rocket motor pursuant to a government contract strictly liable for damage caused to neighboring property, even in the absence of negligence?
Opinions:
Majority - Tamura, J.
Yes, a private company that test-fires a large rocket motor is strictly liable for resulting damage, and this liability is not excused by the fact that the activity was performed under a government contract. The court determined that static rocket testing on this scale constitutes an ultrahazardous activity. Applying the test from the Restatement of Torts § 520, the activity (a) necessarily involves a risk of serious harm which cannot be eliminated by the exercise of utmost care, and (b) is not a matter of common usage. The court reasoned that public policy requires placing the inevitable loss on the party best able to shoulder it—the one engaged in the enterprise for profit—rather than on the innocent neighboring landowner. The court rejected Lockheed's claim of shared governmental immunity, distinguishing cases involving non-ultrahazardous activities and noting that the trend in law is to restrict, not expand, sovereign immunity. As between an innocent landowner and a contractor engaged in an ultrahazardous activity, the court found no compelling reason to extend immunity.
Analysis:
This case solidifies the application of strict liability for ultrahazardous activities to modern, large-scale technological endeavors like rocket testing. It establishes a significant precedent by refusing to extend the government contractor defense to shield private companies from strict liability for damages caused by such inherently dangerous work. The decision reinforces the public policy of allocating the costs of foreseeable, though unavoidable, harm to the enterprise that creates the risk and benefits from it, rather than to innocent third parties. This ruling has a continuing impact on aerospace, defense, and other high-tech industries, clarifying that they cannot escape strict liability for ultrahazardous activities by virtue of their contractual relationship with the government.
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