Aerojet General Corp. v. D. Zelinsky and Sons

• Decision Date: 20 March 1967
• Citation: 57 Cal.Rptr. 701,249 Cal.App.2d 604
• Court: California Court of Appeals Court of Appeals
• Parties: AEROJET GENERAL CORPORATION, a corporation, Cross- Complainant and Respondent, v. D. ZELINSKY & SONS, a copartnership, Cross-Defendant and Appellant. Civ. 11271.

Page 701

57 Cal.Rptr. 701

249 Cal.App.2d 604

AEROJET GENERAL CORPORATION, a corporation, Cross- Complainant and Respondent, v. D. ZELINSKY & SONS, a copartnership, Cross-Defendant and Appellant.

Civ. 11271.

Court of Appeal, Third District, California.

March 20, 1967.

Hearing Denied May 17, 1967.

McGregor, Bullen & Erich, by Donald McGregor, Sacramento, for appellant.

Johnson, Davies & Greve, by Clair Greve and William Sitton, Sacramento, for respondent.

FRIEDMAN, Associate Justice.

This appeal is the outgrowth of an industrial accident which occurred in August 1956, resulting in the death of Otto Woolen and Edward Dauer. Both were employed as painters by D. Zelinsky & Sons, an independent painting contractor. Heirs of the two employees brought separate wrongful death actions against Aerojet General Corporation, at whose plant the painting was taking place. In each case a jury awarded damages against Aerojet, but each judgment was reversed for errors in jury instruction. (Woolen v. Aerojet General Corp., 57 Cal.2d 407, 20 Cal.Rptr. 12, 369 P.2d 708; Dauer v. Aerojet General Corp., 224 Cal.App.2d 175, 36 Cal.Rptr. 356.) Before the retrial of either lawsuit, Aerojet entered into settlements with the plaintiffs. In the present proceeding Aerojet seeks indemnity against Zelinsky for the amount of the settlements plus its litigation expenses. The trial court sustained Aerojet's claim and Zelinsky appeals.

The circumstances of the accident have been described in the Supreme Court's decision in Woolen v. Aerojet, supra, and this court's decision in Dauer v. Aerojet, supra, and it will be necessary to state them only briefly here. Aerojet hired Zelinsky to paint the interior of two liquid fuel storage tanks with a highly volatile paint. An explosion occurred inside one of the tanks while the work was in progress, fatally injuring the two employees. There was evidence that the paint contained volatile, inflammable solvents; that the explosion would not have occurred had blowers been supplied to create air circulation and had explosion-proof electrical equipment been used. The contract between Aerojet and Zelinsky contained no explicit safety provisions, but simply required Zelinsky to furnish 'all plant, labor, equipment and material' to accomplish the work. Zelinsky had full control of the painting operations and Aerojet supplied no direction or supervision. The evidence did indicate that Aerojet itself had been in active charge of an earlier and separate project involving use of the same paint and on that job had supplied blowers and explosion-proof lighting.

The Woolen suit went to trial in January 1959. The Supreme Court's reversal of the judgment occurred in March 1962. The court sustained the trial court's denial of Aerojet's motion for judgment notwithstanding the verdict, holding that there was sufficient evidence to support a judgment against Aerojet under the rule described in section 413, Restatement of Torts, this rule being the same as California law; ¹ held that the trial court had erred in instructing the jury regarding the duty of an invitor (Aerojet) to keep its premises reasonably safe for its invitees, since such an instruction failed to include the elements necessary to liability under Restatement section 413; held that error had also occurred in instructions on an 'employer's' duty to comply with industrial safety orders since, under the circumstances, Aerojet had no obligation to assure compliance with safety orders by Zelinsky, an independent contractor.

The Dauer case was tried in January 1962, several months before the Supreme Court's decision in Woolen. Approximately the same errors characterized the Dauer trial, and this court reversed the plaintiffs' judgment in conformity with the Supreme Court's decision in the Woolen case.

Aerojet's claim for reimbursement is based upon the doctrine of implied indemnity. When applicable, the doctrine permits one of two tortfeasors to shift the entire loss to the other when, without active fault on the former's part, he has been compelled by reason of some legal obligation to pay damages occasioned by the immediate negligence of the latter. (Ralke Co. v. Esquire Bldg. Maintenance Co., 246 A.C.A. 170, 173, 54 Cal.Rptr. 556; Pierce v. Turner, 205 Cal.App.2d 264, 267--268, 23 Cal.Rptr. 115; American Can Co. v. City & County of San Francisco, 202 Cal.App.2d 520, 525, 21 Cal.Rptr. 33.) Implied indemnification may rest upon equitable considerations, impelled by a contrast between the secondary, passive role of one tortfeasor and the primary, active role of the other. (Cahill Bros., Inc. v. Clementina Co., 208 Cal.App.2d 367, 381--382, 25 Cal.Rptr. 301; San Francisco Unified School District v. California Bldg. etc. Co., 162 Cal.App.2d 434, 445, 328 P.2d 785.) It may also rest upon a contractual relationship between indemnitor and indemnitee, predicated upon the former's breach of an implied contract to perform the work carefully and to discharge foreseeable damages resulting from that breach. (Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 131, 76 S.Ct. 232, 100 L.Ed. 133; Weyerhaeuser S.S. Co. v. Nacirema Operating Co., 355 U.S. 563, 567, 78 S.Ct. 438, 2 L.Ed.2d 491; Great Western Furniture Co. v. Porter Corp., 238 Cal.App.2d 502, 517, 48 Cal.Rptr. 76; Cahill Bros., Inc. v. Clementina Co., supra, 208 Cal.App.2d at pp. 376--380, 25 Cal.Rptr. 301; Alisal Sanitary Dist. v. Kennedy, 180 Cal.App.2d 69, 79, 4 Cal.Rptr. 379.) Whichever is the theoretical premise, equitable or implied contractual, the indemnity claimant's active participation in the wrong will usually preclude his recovery. (Goldman v. Ecco-Phoenix Elec. Corp., 62 Cal.2d 40, 44, 41 Cal.Rptr. 73, 396 P.2d 377, citing Cahill Bros., Inc. v. Clementina Co., supra, 208 Cal.App.2d at p. 382, 25 Cal.Rptr. 301; Great Western Furniture Co. v. Porter Corp., supra, 238 Cal.App.2d at p. 517, 48 Cal.Rptr. 76; see Annot., Construction Contractor--Indemnity, 97 A.L.R.2d 616.)

Labor Code section 3864, adopted in 1959, prohibits indemnity recovery by a third party against the employer of the injured person absent an express indemnification agreement. The 1959 statute does not apply retroactively to this 1956 accident. (Vegetable Oil Products Co. v. Superior Court, 213 Cal.App.2d 252, 258, 28 Cal.Rptr. 555; American Can Co. v. San Francisco, supra, 202 Cal.App.2d at p. 524, 21 Cal.Rptr. 33.)

Aerojet's indemnification proceeding was tried without a jury. Bulk of the evidence consisted of the reporters' transcripts of the Woolen and Dauer trials. The trial court found that Zelinsky had exclusive control and supervision of the painting operation; that prior to the execution of the contract both parties were aware that the paint was highly volatile and explosive and that precautions would be necessary; that it was reasonable that Aerojet would rely on the skill and qualifications of Zelinsky as an expert; that Aerojet performed all the terms and conditions of the contract; that Zelinsky negligently and in breach of the contract failed to provide its employes a reasonably safe place to work and failed to furnish the necessary labor, plant, equipment, material and supplies to perform the work in a reasonably safe and workmanlike manner; that the explosion and the deaths of Woolen and Dauer resulted solely and exclusively from the negligence of Zelinsky and from Zelinsky's breach of its contract with Aerojet; that Zelinsky had stipulated to the propriety and reasonableness of the settlements and to the reasonableness of the litigation expenses incurred by Aerojet. The court also found that no act or omission of Aerojet 'proximately or otherwise' caused the deaths; that Aerojet was not guilty of any negligence 'active or affirmative or otherwise, so as to preclude its rights to indemnity.'

The findings declare that Zelinsky breached its contractual duty of care; that the accident resulted from this breach. Zelinsky does not attack the evidentiary basis for this declaration. Aside from the question whether Aerojet's own role in the accident bars indemnity, the findings fully support indemnification based upon Zelinsky's breach of an implied covenant to perform the work in a reasonably safe manner.

Zelinsky contends that the findings omit a material issue, namely, the breach or liability in consequence of which Aerojet made the settlements; that, for all that appears in the findings, Aerojet might have made the settlements as a volunteer; that, had such a finding been made, it would disclose settlements based upon Aerojet's independent liability for its own actionable negligence; that such negligence precludes Aerojet's recovery as an implied indemnitee.

In both the Woolen and Dauer actions the reviewing courts had discarded the notions of Aerojet's responsibility as a landowner to its invitee and as an 'employer' bound to assure compliance with industrial safety orders. By a process of elimination, the only theory under which Aerojet might be directly liable to the heirs was that described in Restatement section 413. Aerojet settled not as a volunteer but under compulsion of its own potential liability for breach of the duty of care described in the Restatement rule. (Great Western Furniture Co. v. Porter Corp., supra, 238 Cal.App.2d at p. 512, 48 Cal.Rptr. 76; Safeway Stores, Inc. v. Massachusetts Bonding & Ins. Co., 202 Cal.App.2d 99, 115--116, 20 Cal.Rptr. 820; Pac. Tel. & Tel. Co. v. Pac. Gas & Elec. Co., 170 Cal.App.2d 387, 392, 388 P.2d 984.) Personal liability of the indemnitee does not preclude indemnification, since his legal responsibility for the injury is the very occasion for the claim of indemnity.

Having before it the same trial transcripts and exhibits which had prompted the appellate courts to find substantial evidence of Aerojet's violation of the rule articulated in the Restatement, the trial court in the indemnification proceeding could have found Aerojet guilty of...