Furlon v. Haystack Mountain Ski Area, Inc., 261-77

• Decision Date: 06 June 1978
• Docket Number: No. 261-77,261-77
• Citation: 388 A.2d 403,136 Vt. 266
• Court: Vermont Supreme Court
• Parties: Louis FURLON and Hartford Insurance Group v. HAYSTACK MOUNTAIN SKI AREA, INC.

Page 403

388 A.2d 403

136 Vt. 266

Louis FURLON and Hartford Insurance Group v. HAYSTACK MOUNTAIN SKI AREA, INC.

No. 261-77.

Supreme Court of Vermont.

June 6, 1978.

Motion for Reargument Denied

French & Zwicker, and Robert Grussing, III, Brattleboro, of Furlon, Weber, Fisher, Perra & Gibson, Brattleboro, for Hartford Insurance Group, plaintiffs.

Robinson E. Keyes of Ryan, Smith & Carbine, Ltd., Rutland, for defendant.

Before BARNEY, C. J., and DALEY, LARROW, BILLINGS and HILL, JJ.

HILL, Justice.

On March 22, 1967, plaintiff-appellant Furlon, an employee of defendant-appellee Haystack, was severely injured while attempting to repair one of Haystack's ski lifts. Appellant filed a workmen's compensation claim, 21 V.S.A. § 601 et seq., and collected a sum of money from Hartford Insurance Group, Haystack's insurance carrier.

On March 10, 1970, appellant sued the manufacturer of the ski lift, Mueller Lifts of Switzerland (and Ers P. Meyer d/b/a Mueller Lifts). In his complaint against Mueller appellant alleged negligence in the design and manufacture of the ski lift and breach of warranty. Mueller did not defend this lawsuit, and appellant received a default judgment in the amount of $284,000.00. No part of this judgment has been collected.

On November 28, 1973, appellant brought this action, alleging that Haystack was liable to him for the full amount of the default judgment, plus costs and interest. Hartford Insurance Group intervened as a plaintiff, pursuant to its right to be reimbursed out of any monies paid on the default judgment for its workmen's compensation payments to appellant. 21 V.S.A. § 624.

Appellant's claim against Haystack is based on the contract by which Haystack agreed to purchase the ski lift from Mueller. The relevant portion of that contract reads:

Further Responsibilities:

The Buyer assumes all legal responsibility for any personal injuries, deaths or property damage that may result from the erection or operation of the Chattels, and for this purpose, he shall take out the necessary insurance coverage at his expense.

Appellant argues that the above provision makes him a third-party beneficiary of the contract, and that as such he is entitled to sue Haystack directly for satisfaction of the judgment received against Mueller.

The parties filed an agreed statement of facts with the trial court, and both sides moved for summary judgment. After hearing, appellant's motion was denied; Haystack's motion was granted, and judgment was entered for Haystack. Haystack's motion presented several different grounds for dismissal. The lower court's ruling was based on one of these grounds only. All parties have agreed that if we find the basis of the trial court's ruling to be unsupported, we may uphold the judgment if we find it supported by any of the other grounds for dismissal offered below. See Bennett v. Robertson, 107 Vt. 202, 209, 177 A. 625, 628 (1935).

The lower court held that the above-quoted provision of the sales contract did not give appellant the right to enforce his default judgment against Haystack. Adopting the general rule that indemnification clauses should not be construed to protect an indemnitee from his own negligence unless such an intention is expressly stated, the court found that Haystack had assumed responsibility for its own conduct only. The court further reasoned that because appellant's claim and judgment against Mueller were for faulty design and manufacture, they fell outside the ambit of the "Further Responsibilities" clause, which covered injuries resulting from "erection or operation." We disagree.

The lower court's reading of the "Further Responsibilities" clause would render that clause a nullity. If the intention of the parties was that Haystack should be liable for its own conduct only, there would have been no reason to include the subject clause. This case is distinguishable from those in which a manufacturer indemnifies a buyer against liability for the manufacturer's negligence. Such a clause serves a purpose in those cases because there the buyer, as Haystack here, could be liable for injury to a customer or employee even though the defect causing the injury was wholly attributable to the manufacturer. See, e. g., Rogers v. W. T. Grant Co., 132 Vt. 485, 321 A.2d 54 (1974). In the reverse situation presented here, a clause which simply indemnified Mueller against liability for Haystack's negligent acts would be unnecessary, because Mueller not having breached any duty could not be held liable for injuries resulting from Haystack's negligence. We should avoid constructions which render ineffectual the language of a contract. McLean v. Windham Light and Power Co., 85 Vt. 167, 178, 81 A. 613, 617 (1911).

Furthermore, we decline to apply in this case the rule that an indemnification clause does not cover liability for the indemnitee's own negligence unless it expressly so states. Although we acknowledge that the lower court was following the generally-accepted rule, the question is an open one in Vermont and in this case we think the reasons for that rule are absent.

First, there is not such ambiguity in the "Further Responsibilities" clause that we must resort to technical rules of construction. See In re Beach's Estate, 112 Vt. 333, 335, 24 A.2d 340 (1942). Appellant's injury did "result from" the "operation" of the ski lift. In fact, it was the sudden and unexpected starting-up of the lift which caused appellant's injury. ¹ The assumption by Haystack of "all legal responsibility" for such an injury should...