## Facts

- Jerome E. Bailey was injured when wheels from a tractor-trailer separated after an axle broke and struck his oncoming vehicle.
- May Trucking Co. purchased a 1993 Kenworth tractor-trailer when it was new or nearly new and operated it for about six years and 500,000 miles.
- During its ownership, May Trucking was responsible for maintenance; Bailey alleged it negligently failed to maintain the axle and that this negligence was a substantial cause of the later axle failure.
- May Trucking sold the tractor-trailer to Lewis Farm, Inc.; about a year after the sale, the axle broke while Lewis Farm was operating the vehicle.
- Bailey sued, asserting May Trucking’s pre-sale negligent maintenance created a dangerous condition that later caused the axle failure and resulting injuries.
- The trial court dismissed Bailey’s negligence claim against May Trucking for failure to state a claim; the Court of Appeals affirmed by an equally divided court.

## Issues

1. Whether a former owner’s sale of a vehicle categorically eliminates negligence liability for injuries to third parties allegedly caused by the former owner’s negligent maintenance during its ownership.
2. Whether intervening ownership and the subsequent owner’s opportunity to inspect or maintain the vehicle necessarily breaks causation as a matter of law at the pleading stage.

## Decision

- The Oregon Supreme Court reversed the dismissal and remanded for further proceedings.
- The court held that the sale of the tractor-trailer did not, as a matter of law, relieve May Trucking of potential liability for its earlier negligent maintenance.
- On a motion to dismiss, the complaint’s allegations—foreseeable risk from negligent maintenance and substantial causation—were sufficient to state a cognizable negligence claim.
- Intervening ownership did not automatically sever causation; those questions concern proof and potential allocation of fault, not categorical pleading failure.

## Legal Principles

- Ordinary negligence principles govern claims that a defendant’s negligent maintenance created a dangerous condition that later causes physical harm; transfer of the chattel does not itself create immunity.
- A defendant may be liable when its conduct unreasonably creates a foreseeable risk of physical harm to others and is alleged to be a substantial factor in causing the harm.
- Foreseeability and the scope of risk may include harm occurring after resale when the alleged negligent maintenance of a safety-critical component could predictably result in road hazards to other motorists.
- Whether later acts of a subsequent owner constitute a superseding cause generally cannot be resolved as a matter of law on a motion to dismiss when the complaint alleges the earlier negligence remained a substantial cause.

## Conclusion

The Oregon Supreme Court held that a former owner’s sale of a vehicle does not categorically bar negligence liability for injuries to third parties allegedly caused by the former owner’s negligent maintenance during its ownership, and it reinstated Bailey’s claim for adjudication on the merits.


Bailey v. Lewis Farm, Inc., 343 Or. 276, 171 P.3d 336 (Or. 2007)