American Oil Company v. Hart

• Decision Date: 08 February 1966
• Docket Number: No. 21972.,21972.
• Citation: 356 F.2d 657
• Parties: The AMERICAN OIL COMPANY, Appellant, v. John H. HART et al., Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

356 F.2d 657 (1966)

The AMERICAN OIL COMPANY, Appellant, v. John H. HART et al., Appellees.

No. 21972.

United States Court of Appeals Fifth Circuit.

February 8, 1966.

Marion R. Shepard, Jacksonville, Fla., for appellant, Mathews, Osborne & Ehrlich, Jacksonville, Fla., of counsel.

Alfred C. Scott, Richard L. Randle, Edward H. Robinson, Robinson & Randle, Jacksonville, Fla., for appellee, John H. Hart.

Before JONES and BROWN, Circuit Judges, and BREWSTER, District Judge.

JOHN R. BROWN, Circuit Judge:

In this Florida diversity case, Amoco,¹ the unsuccessful Defendant, sued by the Employee of the Independent Contractor,² appeals from the injured Employee's judgment against it in the main case and the judgment in favor of the impleaded Independent Contractor on the contractual indemnity claim. Only the second deserves much treatment, although to illumine it we have to discuss the situation giving rise to the main case.

Amoco owned the service station and leased it in 1955 to Lessee,³ but over the years all of the maintenance and upkeep of the premises (save for light-housekeeping type of activities in the Lessee's daily operations) had been done by Amoco at its expense and under its direction. Twenty-five years before it installed (or had installed) as a part of the station's permanent fixtures a vertical pipe which first bore a large sign, later a small cluster of spotlights. From external appearances, one visibly inspecting it could readily conclude that it was securely bolted to the concrete base by bolts which came up through the flange bell fitting at the base. Repeated painting only served to make it appear all the better. Actually, this was just a deceptive shell since the bell flange was not really bolted to the concrete, and the sole support of the pole was a short piece of vertical threaded pipe sunk in the concrete. From improper protection of the threads on installation, this fitting had become heavily corroded. Proof, if credited by the jury, showed that some years before, the deficiency in the construction of the pole had been called to the attention of responsible Amoco maintenance representatives who for budgetary reasons did nothing.

Amoco, on its own determination and without even so much as consulting the so-called Lessee, decided to mount on the pole a new type of curved, overhead fluorescent lighting fixture weighing some 80 pounds. Amoco, for its own account, on February 24, 1960, contracted with the Independent Contractor to do this work for the sum of $40.45 under a routine repair order form containing a contractual indemnity provision.⁴

About a week later (March 2, 1960) the work commenced. After a visible inspection of the pole, the Employee, using the practice followed by maintenance painters over the years, undertook to reach the top by ascending a ladder resting against the pole. The rusty fitting gave way. The pole fell. The Employee crashed to the concrete apron receiving serious injuries.

By the use of interrogatories as a part of, and in conjunction with, a general charge, F.R.Civ.P. 49(a), a procedural device often having much appeal as the trial Court exercises its discretion in the choice of the manner of jury submission especially in complex areas of multiple claims-multiple parties, and the like,⁵ we know precisely what the jury found. Without going into detail, it is sufficient to summarize that the jury found specifically that vis-a-vis the Lessee Amoco had undertaken to maintain, keep up, and repair the premises, and that while it did not know of the defect in the pipe structure, this deficiency was in existence at the time of the lease (1955), the time of the contract (February 24, 1960), and the time of the work, and in the exercise of ordinary care it should have known of it at these times. The Employee was also categorically exonerated from contributory negligence.

Based on these findings and the record, we are able to make precise legal conclusions. We reject Amoco's contention as to the main case that under Florida law the proof was insufficient to sustain the verdict and judgment against it for the injured Employee. Under accepted Florida law, Amoco, responsible for its upkeep and maintenance and chargeable with knowledge of the long standing deficiency of this whole structure, could properly be held by the jury to have breached its duty to employees of an independent contractor. Hall v. Holland, Fla.1950, 47 So.2d 889, 891. And Hickory House, Inc. v. Brown, Fla.1955, 77 So.2d 249, so heavily stressed by Amoco, does not compel a different result.

Amoco's argument attacking the denial of the third-party impleader judgment against the independent contractor is a simple one. Standing squarely on Jacksonville Terminal Co. v. Railway Express Agency, Inc., 5 Cir., 1961, 296 F.2d 256, cert. denied, 1962, 369 U.S. 860, 82 S.Ct. 949, 8 L.Ed.2d 18, and American Agricultural Chemical Co. v. Tampa Armature Works, Inc., 5 Cir., 1963, 315 F.2d 856, it insists that the words of the indemnity clause (see note 4, supra), being substantially identical, compel an identical result. And so it would, were contract construction simply a question of simple words.

But any such approach ignores the well accepted, but frequently ignored, principle that the words employed are read in the setting of the parties.⁶ In this light it is simply inconceivable that it was within the contemplation of these parties that although wholly innocent of any negligent conduct in the use of Amoco's premises, the Independent Contractor for the slight sum of $40 agreed to take on itself — and conversely spare Amoco of any pecuniary burden — the legal consequences arising from Amoco's negligence in furnishing an unsafe place to work by reason of the known (actual or constructive), long standing, then-existing deficiencies⁷ in the very structure involved in the work to be performed by the contractor's employees. Florida has but recently reiterated its adherence to the usual rule that the indemnitor's purpose to indemnify against the indemnitee's negligence must be clearly revealed.

"It is the general principle of law that contracts of indemnification which attempt to relieve a party of its own negligency are not

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