Church v. General Motors Corp.

• Decision Date: 19 January 1996
• Docket Number: No. 95-1229,95-1229
• Citation: 74 F.3d 795
• Parties: Eddie D. CHURCH and Cherri Church, Plaintiffs, v. GENERAL MOTORS CORPORATION, Defendant-Cross-Plaintiff-Appellant, v. POWER PRESS SALES COMPANY, INC., Defendant-Cross-Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 795

74 F.3d 795

Eddie D. CHURCH and Cherri Church, Plaintiffs, v. GENERAL MOTORS CORPORATION, Defendant-Cross-Plaintiff-Appellant, v. POWER PRESS SALES COMPANY, INC., Defendant-Cross-Defendant-Appellee.

No. 95-1229.

United States Court of Appeals,

Seventh Circuit.

Argued Sept. 22, 1995.

Decided Jan. 19, 1996.

Roderick A. Palmore (argued), Sonnenschein, Nath & Rosenthal, Chicago, IL, Brian W. Lewis, David M. Simon, Wildman, Harrold, Allen & Dixon, Chicago, IL, for Defendant-Appellant.

Elliot R. Schiff, Jeffrey D. Corso (argued), O'Connor, Schiff & Myers, Chicago, IL, for Defendant-Appellee.

Before POSNER, Chief Judge, COFFEY and FLAUM, Circuit Judges.

FLAUM, Circuit Judge.

Plaintiff Eddie Church was injured while dismantling a large "fishbelly" crane at a closed General Motors production plant. He brought Structural Work Act and negligence claims against the new owner of the crane, American Metal Industries, the company that brokered the sale of the crane, Power Press Sales Co., Inc. ("Power Press"), and the previous owner and plant tenant, General Motors Corp. ("GM"). Subsequently, Church's claims were all dismissed on summary judgment or settled.

Before us on appeal is GM's cross-claim against Power Press seeking indemnification for attorney's fees and costs expended in defending Church's suit. GM seeks reimbursement pursuant to an indemnity provision in a November 18, 1988 contract entered into by Power Press and GM. Initially, the district court granted judgment on the pleadings in favor of GM. Upon a motion for reconsideration, however, the court reversed itself and held that the indemnity clause did not require Power Press to reimburse GM. It then granted Power Press judgment on the pleadings. GM now appeals this decision. We agree with the district court's interpretation of the indemnity provision and affirm its decision.

I.

In 1986, GM decided to close its Willow Springs, Illinois production plant. In March 1989, GM sold the facility to United Parcel Service, but leased the building back for the remainder of the year in order to sell off certain equipment and take care of closing details. To that end, GM and Power Press had entered into a written agreement ("GM Agreement"), whereby Power Press, as a non-exclusive broker, was to find potential buyers for GM's salvageable equipment. The GM Agreement will be discussed in some detail, as it forms the basis of GM's claim.

The first section of the Agreement provided:

Under the terms and conditions set forth in this agreement, [Power Press] agrees to sell surplus equipment for General Motors for the period commencing December 1, 1988 through January 31, 1990.

Additional terms of the contract granted GM the power to decide which equipment would be sold, to dispose of surplus equipment in "any manner it deem[ed] best," and to retain ownership and title of all equipment prior to the conclusion of a sale. All sales were subject to GM's approval, and Power Press was required to obtain written authorization for each sale, specifying the equipment to be sold and the date by which the equipment was to be removed from the plant.

The Agreement also provided that:

[Power Press] shall be obligated to transport ... selected equipment from General Motors premises within the time designated in the disposal authorization.

Power Press was required to carry workmen's compensation insurance on its employees, and further:

If [Power Press] shall sublet any portion of the work contemplated in the agreement, [Power Press] shall require each subcontractor to accept the provisions of this article and the provisions of said workmen's compensation act or law, and shall require such subcontractors to carry workmen's compensation insurance on employees of such subcontractors.

The parties also agreed that the contract would be governed by Illinois law. Finally, the Agreement included an indemnity clause, under which Power Press was obligated to indemnify GM for:

all claims, suits, liabilities, damages, and losses, including costs, expenses, and reasonable attorney's fees through action taken by any party arising from conduct of [Power Press], its officers, agents, contractors, and employes [sic], ¹ in connection with the sale of equipment, any activity related thereto, or the performance of any obligations of [Power Press] pursuant to this agreement.

Pursuant to this contract, Power Press obtained a bid from American Metal Industries ("AMI") for nine, large, overhead "fish-belly" cranes, which hung from the ceiling of the GM plant. On August 31, 1989, GM approved AMI's offer for the cranes and issued a written authorization of the sale stipulating that AMI had to remove the cranes by November 20, 1989 in order to avoid forfeiture of the cranes. Power Press completed the sale of the cranes, and an invoice dated September 20, 1989 was issued from Power Press to AMI ("AMI contract"). As reflected on the invoice, the nine "40 ton cranes" were sold on an "as is, where is, with all faults basis" for $60,000. There was no other contract or agreement between Power Press and AMI. At AMI's request, GM eventually extended the removal deadline until December 31, 1989.

AMI hired Schuette Crane Corporation ("Schuette") to dismantle the cranes and transport them to Schuette's yard for storage. Power Press was not involved in the hiring of Schuette, nor did it recommend or suggest that AMI hire Schuette to remove the cranes. Schuette then hired Central Contractor Services, Inc. ("Central") and three members of Ironworkers Union Local 1 to assist in the dismantling of the cranes. Schuette employees developed the procedure for lowering and dismantling the cranes and Schuette employees alone directed and supervised the dismantlement.

Eddie Church was one of the three Ironworkers Union members hired by Schuette. On December 12, 1989, while Church and the rest of the Schuette dismantling crew were lowering one of the overhead cranes, Church was struck by the crane and suffered serious injuries. Seeking compensation for the injuries he sustained, Church and his wife sued GM, Power Press, AMI, and Central under the Illinois Structural Work Act and for common law negligence. Schuette was later added as a third-party defendant.

Based on the indemnity provision in its agreement with Power Press, GM tendered its defense to Power Press. GM maintained that AMI, and hence Schuette (whose conduct the parties now agree was responsible for Church's injuries), were Power Press "contractors" for removal of the cranes. Therefore Power Press was obligated to indemnify GM under the Agreement. When Power Press denied this obligation, GM filed a cross-claim for indemnification against Power Press.

Eventually, the district court granted summary judgment in favor of GM, Power Press, and AMI on the issue of liability to Eddie Church. The court found none of these parties responsible for Church's injuries. Shortly thereafter, Church negotiated a settlement with Schuette and Central. This left only GM's claim for indemnification against Power Press unresolved. Since GM was not found liable for Church's injuries, the indemnity claim involved only attorney's fees, costs, and expenses GM incurred in defending the litigation.

Although the district court initially granted GM judgment on the pleadings, in its final decision, the court found that AMI and Schuette were not "contractors" of Power Press within the meaning of the indemnity provision. Thus the court concluded that Power Press had no obligation to reimburse GM under the Agreement and it granted judgment in favor of Power Press.

II.

The thrust of GM's appeal is that the district court erred in finding that AMI and Schuette were not Power Press "contractors" for removal of the cranes. Before we reach the merits of GM's argument, however, we first address several preliminary issues.

A.

Initially we must determine the nature of the motion presented to us for review. The district court characterized its decision as a rule 12(c) judgment on the pleadings, which we would uphold only if it appears beyond doubt that the non-movant can prove no set of facts that would support its claim for relief. See GATX Leasing Corp. v. National Union Fire Ins. Co., 64 F.3d 1112, 1114 (7th Cir.1995); Thomason v. Nachtrieb, 888 F.2d 1202, 1204 (7th Cir.1989). However, under rule 12(c), if "matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgment...." Fed.R.Civ.P. 12(c); Dempsey v. Atchison, Topeka and Santa Fe Ry. Co., 16 F.3d 832, 835-36 (7th Cir.), cert, denied, --- U.S. ----, 115 S.Ct. 82, 130 L.Ed.2d 35 (1994). Upon review of the memorandum submitted to the district court and the district court's opinion, it is apparent that deposition testimony, exhibits attached to summary judgment motions, additional contracts and other evidence were presented to the district court and were not rejected. The parties have directed us to similar evidence outside the pleadings on this appeal. Therefore, we find the motion presented for our review is more accurately characterized as a motion for summary judgment, and it will be treated as such. ²

This being said, we generally review a grant of summary judgment de novo to determine if no genuine issue of material fact exists and the moving party must prevail as a matter of law. Fed.R.Civ.P. 56; Serfecz v. Jewel Food Stores, 67 F.3d 591, 596 (7th Cir.1995). Power Press argues, however, that the clearly erroneous standard is more appropriate in this case because the parties do not contend that there is any genuine issue of material fact, but only dispute the court's application of law to the uncontested facts. We do not agree. The clearly erroneous standard does apply to any district court factual finding drawn from undisputed underlying facts. See Cohen v. City of Des Plaines, 8 F.3d 484, 488 (7th Cir.1993), cert. denied, --- U.S. ----, 114 S.Ct. 2741, 129...