Butters v. Consolidated Transfer & Warehouse Co., Inc.

• Court: Kansas Supreme Court
• Writing for the Court: FATZER; FROMME
• Citation: Butters v. Consolidated Transfer & Warehouse Co., Inc., 510 P.2d 1269, 212 Kan. 284 (Kan. 1973)
• Decision Date: 09 June 1973
• Docket Number: No. 46794,46794
• Parties: Kenneth R. BUTTERS et al., Appellants, v. CONSOLIDATED TRANSFER AND WAREHOUSE COMPANY, INC., Appellee.

Page 1269

510 P.2d 1269

212 Kan. 284

Kenneth R. BUTTERS et al., Appellants, v. CONSOLIDATED TRANSFER AND WAREHOUSE COMPANY, INC., Appellee.

No. 46794.

Supreme Court of Kansas.

June 9, 1973.

Syllabus by the Court

1. In an action upon an indemnity or 'hold harmless' agreement, the record is examined, and it is held: The pleadings and transcript in the original proceedings against indemnitee were ample to support the district court's finding that recovery was barred on indemnitee's own negligence.

2. It is a general rule that a contract of indemnity will not be construed to indemnify the indemnitee against losses resulting from his own negligent acts unless such intention is expressed in clear and unequivocal terms, or unless no other meaning can be ascribed thereto, and mere general broad and seemingly all-inclusive language in the indemnifying agreement is not sufficient to impose liability for the indemnitee's own negligence.

3. The indemnity agreement set out in the opinion did not show an intention expressed in clear and unequivocal terms to indemnify against the indemnitee's own negligence.

J. D. Lysaught, of Weeks, Thomas, Lysaught, Bingham & Johnston, Chartered, Kansas City, argued the cause, and Thomas D. Cochran, Independence, was with him on the brief for appellants.

N. Jack Brown, of Boddington, Brown & Unverferth, Kansas City, argued the cause, and Roy A. Larson, Jr., of Sprinkle, Carter, Lawson & Hanna, Kansas City, Mo., was with him on the brief for appellee.

FATZER, Chief Justice:

This is an appeal from a summary judgment denying relief under a 'hold harmless' agreement.

The city of Independence, Missouri, owns and operates a power and light department as a public utility engaged in the proprietary function of purchasing electric power for distribution to customers. In connection therewith it owned, controlled, and operated an electric transformer substation located at 34th Street and Kiger Road.

On or about July 12, 1968, Consolidated Transfer and Warehouse Company, Inc. (Consolidated) was performing heavy hauling work for the city of Independence (city), and was specifically engaged in delivering a large electric transformer to the substation mentioned. The contract governing the performance of the work provided, in part:

'The Contractor agrees to hold the City harmless from any and all claims or liability for bodily injury, death and property damage to Contractor, his employees, agents, servants, and third parties, while engaged in the performance of this contract.

'The Contractor shall carry Workmen's Compensation Insurance during the performance of this contract, all in accordance with the laws of the State of Missouri and further agrees to carry Employer's Liability and Public Liability Insurance in the amount of $1,500,000.00 combined single limit for any one occurrence.'

John Jamieson, an engineer for the city of the last eight years, including the time covered by the accident in question, was familiar with the National Electric Safety Code followed as a rule book or guide by the city employees. These safety standards required that unqualified workmen and visitors, unqualified employees or visitors and workmen whose employment incidentally brought them into the vicinity of electrical supply equipment to be accompanied by a qualified employee to provide suitable safeguards and instructions.

At the time of the accident in question, wherein Consolidated was attempting to deliver the transformer to the substation, the foreman in charge of the substation was Leo F. Hoyle. As foreman, Hoyle was not familiar with the safety rules or regulations with respect to the usage of a crane in or about an energized substation, although he was generally aware that unqualified persons were not to be allowed in the substation. As foreman of the substation Hoyle failed to warn any of the employees of Consolidated of the existence or the voltage of the power lines, and admitted there were no warning signs of or about the power lines. Further, Hoyle left the substation before the arrival of Consolidated's employees and took with him the only other city employee at the substation.

When the employees of Consolidated arrived with the crane and transformer at the unmanned substation they were unaware that if the boom of the power crane came closer than two and a half or three feet to the 69,000 volt conductor existing at the station in question, this would cause 'arcing.' While Kenneth Butters was unhooking the 'whip line' it swung out away from the bumper and as he saw the whip line coming back toward him, he grabbed it with his left hand, receiving an electrical shock injuring his body.

As a result of the injuries sustained by Kenneth, he and his wife, Elma Butters, residents of Wyandotte County, Kansas, instituted an action for damages against the city and Olinger Heavy Hauling Service (Olinger) and added Evans as an additional defendant. Thereafter, Olinger impleaded Consolidated as a third party defendant and the city made a third party claim against Consolidated, cross claiming against Evans and Olinger.

Thereafter, the Butters entered into an agreement with the city whereby the city paid the Butters the sum of $25,000 and the Butters acknowledged that they were making claim against the city, Olinger and Evans and that in the event they recovered judgments against the city, execution thereon would be limited to all proceeds, claims and rights in contract and in tort of certain specified insurance companies and written contracts of indemnity and all indemnifications, whether in contract or in tort (whether written, oral, implied or arising by operation of law) between the city and Evans, Consolidated and any subsidiary or agent except Olinger, and that the city would assign such rights of indemnity, if any, to Butters.

Kenneth, being an employee of Consolidated, had previously filed for and received workmen's compensation from Consolidated, under the laws of the State of Missouri in the amount of $40,877.43.

On January 28, 1971, the Thursday before this case was to commence trial on Monday, Butters proceeded to put on evidence in a default proceeding against the city under the agreement reached with the city hereinbefore mentioned. The attorneys for the other interested parties, having previous knowledge of the intention of Butters and his attorneys, were present at those default proceedings and attempted to participate therein in order to protect the interests of their respective clients. At that time, in order to protect the parties not allowed to participate, the Missouri court ruled that any determination in favor of the Butters and against the city would not be binding on the other parties, including Consolidated. Butters then proceeded to present evidence and argument in support of his damages in this default proceeding against the city, and at the conclusion of the trial, the court took the matter under advisement and on April 8, 1971, entered its judgment in favor of Kenneth Butters in the sum of $250,000 and in favor of Elma Butters in the sum of $50,000 and against the city.

On April 21, 1971, the city voluntarily dismissed the Missouri action as to defendants Evans and Consolidated; Olinger had previously been dismissed from the Missouri action as a result of a settlement reached with Butters.

Thereafter, pursuant to its agreement, the city assigned to the Butters its right of indemnity against Consolidated. The action which we are now considering was filed by the city and the Butters, claiming Butters to be the assignee of the city's right against Consolidated under the indemnity agreement.

Consolidated filed motions to dismiss both as to the city and the Butters. The pleadings, transcript, and journal entry in the Missouri default proceedings were submitted to the district court. The district court treated the motions to dismiss as motions for summary judgment. Without setting out all the grounds for dismissal, it will suffice to say that the district court found the actions were barred by the Workmen's Compensation Act and the Statute of Limitations, and further found:

'The case brought by Mr. and Mrs. Butters in the Circuit Court of Jackson County, Missouri, for Mr. Butters' injuries is against the...