Lawsuits versus regulations and penalties: implications for health departments. (Legal Briefs).

Have you ever encountered a belligerent restaurant operator who refused to correct deficiencies? What did you do after your best effort to explain the scientific and sanitary principles of food safety were rebuffed? Did you appeal to the opertor's sense of pride or resort to threatening legal sanctions? Case 1 in this month's column is a good example of the impact health inspection results have at trial when a restaurant is accused of a food poisoning, and might help in convincing an operator of the importance of prompt compliance with the Food Code.

Case 2 looks at whether compliance with state and local regulations for on-site sewage disposal systems exempts a septic system from any implied warranty to a homeowner that the septic system would be reasonably fit for its ordinary purpose. Case 3 is about a local housing code provision that mandates annual inspection of all rental units if one unit is substandard.

Case #1: Restaurant Liable for Food Poisoning (1)

On June 4,1997, all but one member of the Croteau family ate breakfast at a Denny's restaurant in Lawrence, Massachusetts. None had been sick before. The father and one son had sausage, eggs, pancakes, and toast. The mother had steak, home fries, and eggs, some of which she fed her baby. Nothing was observed or smelled wrong with the food. They finished their breakfast and returned home around 9:00 a.m.

The son complained of stomach problems around noon. Two hours later, he was vomiting. That evening he had constant diarrhea. The diarrhea continued the next day The following day he was admitted to a hospital and stayed for three days. At the hospital, he received antibiotics and intravenous treatments for dehydration.

The evening after the Denny's breakfast, the father became sick with cramps and severe diarrhea. That continued for six days. He lost 25 pounds and did not return to normal health for six months.

The mother and baby had only mild diarrhea. The father, mother, son, and baby all tested positive for Salmonella enteritidis. One older son, who did not eat at Denny's, did not become sick, and was negative for Salmonella enteritidis. The family sued Denny's Restaurant for damages.

The plaintiffs had evidence from Denny's records of repeated problems with the refrigerators in May and June 1997. They also had an expert witness who testified that the Denny's breakfast caused the Salmonella food poisoning. Her testimony was based on the time interval between breakfast and the onset of symptoms. Apparently no food samples were collected, no Salmonella enteritidis was isolated at the restaurant, no one reported the episode to the health department, and no epidemiological investigation was conducted.

Nevertheless, a crucial part of the plaintiffs' evidence was inspections by the health department. Three months before the fateful breakfast, a health inspector had cited the restaurant for several violations, including the unsanitary storage of sausage on the floor of the refrigerator and the absence of thermometers in it. Then, a week after the breakfast, another inspection showed that the temperature of the walk-in refrigerator where the sausage and eggs were stored was over 50[degrees]F.

On the basis of this evidence, the court concluded,

Although Denny's properly prepared and stored its egg products, its handling of the sausages was not proper. Denny's stored sausages in an unsanitary condition and did not properly refrigerate them, which increased the risk of salmonella. Moreover, Denny's procedures for cooking sausages were not sufficient to insure that the sausages served to the Croteaus had been cooked enough to kill any bacteria that may have been present.

The trial judge believed the plaintiffs' expert that the breakfast caused the Salmonella infection and that the sausage storage and preparation were unsanitary, awarding the family $50,000 in damages. Finding no clear error in those conclusions, the court of appeals affirmed the decision.

There was no mention in the court decision about any enforcement action by the health department. So, one might wonder about compliance. Yet I am reasonably certain that the restaurant henceforth will make very sure its refrigerators maintain a proper temperature, and that all sausage and eggs are thoroughly cooked. The reason is that the restaurant suffered direct damage to its business reputation and a $50,000 loss, which was certainly greater than any amount of civil penalties that the health department could have assessed. In addition, its liability insurance rates probably increased.

It is unlikely that the plaintiffs would have won without the evidence from the health department inspections. Therefore, citing this case could be very useful in convincing an intransigent owner or operator that it is in his or her best financial interest to make any corrections as soon as possible in order to keep a clean record. The results of health department inspections probably are information the restaurant's insurance carrier also would want to know and should seek.

Case #2: Septic-Tank Regulations Do Not Shield Installer (2)

In Missouri, a new home purchaser receives an implied warranty that the structure of the house is habitable and all its integral parts are reasonably fit for their ordinary purposes. That includes the septic system.

A family purchased a new; finished "spec" home. The septic system was already installed and approved by the county health department. A month after the family moved into the home, the septic system failed. They sued the builder.

At trial, the septic installer argued that the implied warranty did not apply because the on-site sewage disposal regulations removed all decision-making authority from him. The court of appeals, however, ruled that the regulations were merely minimum standards designed to protect public health and safety, and did not remove an installer's discretion to install something bigger or better. Therefore, a failure of the system could constitute a breach of the implied warranty. The case was sent back for trial.

The case is important for environmental health personnel because if the court had held that the installer had no discretion, then it could have made the health department liable for a failure.

Case #3: Housing Code Provision Invalid (3)

The Akron, Ohio, Environmental Health Housing Code has a provision that

The owner or operator of a premises with a rental unit shall have the interior and exterior of the premises, its structures and its rental units inspected semiannually, for a minimum of four years, to determine compliance with the Health, Safety and Sanitation Code, Litter Code, and Zoning Code ... if the owner or operator has been convicted of a violation of this Chapter.

Inspections cost $125 for one unit, $175 for two units, $225 for three units, $250 for four units, and $265 for five or more units, with a fee of $15 for each additional unit over five. The case discussed here, Yajnik v. City of Akron, did not state the usual housing code inspection schedule or procedure.

A landlord was convicted of a housing code violation at one of his units. He owned over 50 rental units in the city Therefore, the Housing Division of the City of Akron scheduled inspections for all units and assessed the landlord the inspection fee. The inspection fees would have cost the landlord about $10,000 a year for four years. He sued the city claiming that the ordinance violated the substantive-due-process provisions of the Ohio and U.S. constitutions.

Substantive due process is a constitutional limitation on municipal ordinances. It requires that all laws and regulations bear a real and substantial relation to public health, safety, morals, or public welfare, and not be unreasonable or arbitrary Yet, it is very rare for any court to declare any statute or ordinance unconstitutional based on a violation of substantive due process, because of a wide berth given to legislative discretion, and the ease with which a court, in hindsight, can find some semblance of a valid public policy justification. Municipal ordinances in Ohio enjoy a strong presumption of constitutional validity

In this case, however, the court of appeals held that

It is unreasonable to subject each of their more than 50 rental units to the mandatory inspection provision of A.C.O. 150.40, where merely one violation, in one rental unit, led to the underlying conviction. We find that A.C.O. 150.40, as applied to the Yajniks in this case, is unconstitutional in so far as it subjects properties where no violations have been found to mandatory inspections.

Editor's note: Readers who have questions about cases discussed in Legal Briefs may contact Mr. Sikora by e-mail at <[e-mail]>

References

(1.) Croteau V. Denny's Restaurant, Inc., 2002 Mass. App. 81 (Ct. App. 2002) http://www.loislaw.com (13 Aug. 2002).

(2.) Wilkinson V. Dwiggins, ED 80003 (Missouri Ct. App. 2002) http://www.-loislaw.com (13 Aug. 2002).

(3.) Yajnik v. City of Akron, No. 2000 03 0977 (Ohio Ct. App. 2002) http://www.loislaw.com (13 Aug. 2002).