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Dow Chemical Company v. Mahlum12/31/1998
rties are dealing at arm's length, a duty to disclose may arise from "the existence of material facts peculiarly within the knowledge of the party sought to be charged and not within the fair and reasonable reach of the other party." Villalon v. Bowen, 70 Nev. 456, 467-68, 273 P.2d 409, 415 (1954) (failure of purported widow to tell the executor of her purported husband's estate that her prior marriage had not been terminated).
The duty to disclose requires, at a minimum, some form of relationship between the parties. See Mackintosh, 109 Nev. at 634-35, 855 P.2d at 553 (disclosure mandated in context of dealings between parties); Villalon, 70 Nev. at 467-68, 273 P.2d at 415 (same); see also In re Temporomandibular Joint (TMJ) Implants Prods. Liab. Litig., 113 F.3d 1484, 1497 (8th Cir. 1997) [hereinafter TMJ Implants] (without some kind of relationship, there can be no duty to disclose). Absent such a relationship, no duty to disclose arises, and as a result, no liability for fraudulent concealment attaches to the nondisclosing party.
It is undisputed that Dow Chemical did not have a fiduciary relationship, a special relationship, or a relationship of any kind with the Mahlums. Instead, the Mahlums claim that Dow Chemical's duty to disclose arose because it possessed superior knowledge about the dangers of using silicone within the human body. Dow Chemical had no duty to disclose to the Mahlums any superior knowledge it may have had regarding the safety of silicone products, however, because it was not directly involved in the transaction from which this lawsuit arose, or any other transaction with the Mahlums. Accordingly, we conclude that the portion of the judgment holding Dow Chemical liable for fraudulent misrepresentation was not supported by evidence of any relationship between the parties and must be reversed.
D. Accessory Liability
The jury also found that Dow Chemical (1) aided and abetted Dow Corning to engage in fraudulent misrepresentation and (2) acted in concert with Dow Corning to commit fraudulent misrepresentation.
The trial court's jury instruction followed section 876 of the Restatement (Second) of Torts. The Restatement provides:
"For harm resulting to a third person from the tortious conduct of another, one is subject to liability if he"
"(a) does a tortious act in concert with the other or pursuant to a common design with him, or"
"(b) knows that the other's conduct constitutes a breach of duty and gives substantial assistance or encouragement to the other so to conduct himself, or"
"(c) gives substantial assistance to the other in accomplishing a tortious result and his own conduct, separately considered, constitutes a breach of duty. to the third person." Restatement (Second) of Torts, 876 (1979) [hereinafter section 8761. Halberstam v. Welch, 705 F.2d 472 (D.C. Cir. 1983), explains that subpart (a) of section 876 corresponds to civil conspiracy, and subpart (b) of section 876 corresponds to civil aiding and abetting. Id. at 477. We will review these theories separately.
1. Concert of Action
Under the Restatement, liability attaches for concert of action if two persons commit a tort while acting in concert with one another or pursuant to a common design. Section 876(a). The tort of concert of action has traditionally been quite narrow in the scope of its application. The classic application of concert of action is drag racing, where one driver is the cause-in-fact of plaintiff's injury and the fellow racer is also held liable for the injury. Santiago v. Sherwin-Williams Co., 794 F. Supp. 29, 31 (D. Mass. 1992), aff'd, 3 F.3d 546 (1st Cir. 1993).
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