Getty Oil Co. v. Insurance Co. of North America, C14-90-00552-CV
| Citation | 819 S.W.2d 908 |
| Decision Date | 07 November 1991 |
| Docket Number | No. C14-90-00552-CV,C14-90-00552-CV |
| Parties | GETTY OIL COMPANY and Texaco Inc., Appellants, v. INSURANCE COMPANY OF NORTH AMERICA, NL Industries, Inc. and Youell and Companies, Appellees. (14th Dist.) |
| Court | Court of Appeals of Texas |
Joe G. Roady, Mary-Ann A. Bellatti, Mariam Kass, Houston, for appellants.
Byron Lee, David W. Prasifka, Jack G. Carnegie, John C. Allen, Tom Bayko, Tom Lorance, Houston, for appellee.
Before ROBERTSON, SEARS and DRAUGHN, JJ.
Getty Oil Company (Getty) and Texaco Inc. (Texaco) appeal from a summary judgment in their suit against Insurance Company of North America (INA), NL Industries, Inc. (NL), and Youell and Companies (Youell). Appellants raise seven points of error claiming that NL's agreement to extend all insurance coverage to Getty is not a prohibited indemnity agreement. Appellants also contend that res judicata and collateral estoppel do not bar the instant suit. Because we find res judicata applicable, we affirm the trial court's judgment.
Getty and NL contracted for Getty to purchase chemicals and services. Paragraph 4 of the contract is entitled "INSURANCE AND INDEMNITY." This paragraph provides:
Seller agrees to maintain at Seller's sole cost and expense, from the time operations are commenced hereunder until Order is fully performed and discharged, insurance of all types and with minimum limits as follows, and furnish certificates to Purchaser's Purchasing Department evidencing such insurance with insurers acceptable to Purchaser:
....
All insurance coverages carried by Seller, whether or not required hereby, shall extend to and protect Purchaser, its co-owners and joint venturers (if any), to the full amount of such coverages and shall be sufficiently endorsed to waive any and all claims by the underwriters or insurers against Purchaser, its co-owners, joint venturers, agents, employees and insurance carriers.
Seller shall indemnify, defend and hold harmless Purchaser, its co-owners, joint venturers, agents, employees and insurance carriers from any and all losses, claims, actions, costs, expenses, judgments, subrogations, or other damages.... Seller shall not be held responsible for any losses, expenses, claims, subrogations, actions, costs, judgments, or other damages, directly, solely, and proximately caused by the negligence of Purchaser. Insurance covering this indemnity agreement shall be provided by Seller.
Carl Duncan, a Getty employee, was injured when a barrel of NL chemicals exploded. Duncan died from his injuries and his estate brought a wrongful death suit against Getty, NL, and others. Getty filed a cross claim against NL for indemnity and contribution. The jury found Getty 100% negligent and the trial court denied Getty's cross-action for contribution and indemnity. Getty settled with the plaintiff but appealed the adverse ruling on its cross action. The trial court's ruling was affirmed on appeal. See Getty Oil Corp. v. Duncan, 721 S.W.2d 475 (Tex.App.--Corpus Christi 1986, writ ref'd n.r.e.).
Getty then filed the instant suit against NL for breach of contract in failing to name Getty as an additional insured and against the primary and excess carriers, INA and Youell respectively, for not paying on the policies. Appellees filed motions for summary judgment on the grounds that Getty's claims were barred by the express negligence doctrine, by the Texas Oilfield Anti-Indemnity Statute, and by res judicata. The trial court granted these motions.
A trial court properly grants summary judgment only when the movant establishes that there are no genuine issues of material fact and that the movant is entitled to judgment as a matter of law. See TEX.R.CIV.P. 166a(c). In reviewing a summary judgment, an appellate court must accept as true all evidence favorable to the non-movant, indulging all reasonable inferences and resolving all doubts in the non-movant's favor. See Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548-49 (Tex.1985).
In point of error six, appellants claim the trial court erred as a matter of law in granting summary judgment based on res judicata. Res judicata involves the principles of merger and bar. If a plaintiff prevails, his cause of action merges into the judgment, dissolving the cause of action. Jeanes v. Henderson, 688 S.W.2d 100, 103 (Tex.1985). If, on the other hand, the plaintiff loses the original suit, the plaintiff is barred from bringing another action upon the claims actually litigated and those that could have been litigated in the original action. Id.; Texas Water Rights Comm'n v. Crow Iron Works, 582 S.W.2d 768, 771-72 (Tex.1979). Thus, res judicata prevents a plaintiff from bringing a second suit against the same parties or their privies asserting causes of action arising out of the same subject matter and that might have been asserted in the first suit. Texas Water Rights Comm'n, 582 S.W.2d at 772; Abbott Laboratories v. Gravis, 470 S.W.2d 639, 642 (Tex.1971). Generally, "a judgment on the merits in a suit on one cause of action is not conclusive of a subsequent suit on a different cause of action except as to issues of fact actually litigated and determined in the first suit." Griffin v. Holiday Inns of America, 496 S.W.2d 535, 538 (Tex.1973). A party may not, however, relitigate the same claim under a different theory. See id. at 537 (citing Abbott, 470 S.W.2d at 642).
Appellees argue that appellants' suit is a disguised attempt to relitigate the original claim for indemnity. In support of this argument, appellees cite Ocean Drilling & Exploration Co., Inc. v. Mont Boat Rental Services, Inc., 799 F.2d 213 (5th Cir.1986). In that case, an Ocean Drilling employee was injured while unloading equipment from a boat owned by Mont. Id. at 215. The employee sued Ocean Drilling who in turn filed third-party claims of contribution and indemnity against Mont. Id. The jury absolved Mont of any wrongdoing and found Ocean Drilling at fault, assessing damages of $340,000.00. Id. The trial court rendered judgment against Ocean Drilling on its third-party claims. Id. Ocean Drilling then brought suit against Mont and its insurers and broker for reimbursement of the amount paid to the injured employee. Id. The trial court dismissed Ocean Drilling's suit on the ground of res judicata. Id.
The Fifth Circuit applied the transactional test of the Restatement (Second) of Judgments to determine whether the causes of action in the two suits were the same. 1 Id. at 217 (citing RESTATEMENT (SECOND) OF JUDGMENTS § 24(1) (1982)). Although the court acknowledged that the theories asserted in the two suits were different, the court found that the right Ocean Drilling sought to redress, reimbursement for the obligation incurred as a result of the judgment in the first suit, was the same in both suits. Id. Because the two causes of action were based on substantially the same facts, the court held that res judicata barred the second suit. Id.
Citing Griffin v. Holiday Inns of America, 496 S.W.2d 535, 538 (Tex.1973), appellants claim that Ocean Drilling is inapplicable because Texas courts expressly refuse to follow the Restatement transactional test. In Griffin, the court clarified a prior holding that a party cannot relitigate matters that could have been raised in a prior action between the same parties or their privies relating to the same subject matter. Id. at 537 (citing Abbott, 470 S.W.2d at 642). The Griffin court held that the term "subject matter" refers to "the claim or controversy at issue in the earlier suit and not to the transaction out of which the suit arose." Id. The court further stated:
We have not said or held that a judgment in a suit on one claim or cause of action is necessarily conclusive of all claims and causes of action against the same party, or relating to the same property, or arising out of the same transaction. Apparently some courts have gone that far, but we are unwilling to do so.
We disagree with appellants' reliance on this statement in Griffin. Even if Texas courts do not apply res judicata to all claims arising from the same transaction, they do apply res judicata where a party reasserts the same claim under a different theory. See id. at 537 (). Thus, we must determine whether appellants' claim in this case is essentially the same claim raised in the prior suit.
In the first suit, appellants sought indemnity from NL under the indemnity provision of the contract. In the instant suit, appellants seek reimbursement of the amount paid to the plaintiff in the first suit from NL and its insurers based on the provision that NL would extend all insurance coverage to Getty. Appellants allege that NL breached its contract by failing to make Getty an additional insured on the policies and that NL's insurers wrongfully denied payment to Getty as an additional insured.
Paragraph 2 of the "INSURANCE AND INDEMNITY" provision of the contract states that "[a]ll insurance coverages carried by [NL], whether or not required hereby, shall extend to and protect [Getty]...." Because appellants seek reimbursement for the amount paid to the plaintiff in the prior suit under this provision, appellees argue that appellants' construction of this provision would transform the provision into a prohibited agreement to indemnify Getty for its sole negligence. Appellees contend that Fireman's Fund Ins. Co. v. Commercial Standard Ins. Co., 490 S.W.2d 818 (Tex.1972), overruled, Ethyl Corp. v. Daniel Constr. Co., 725 S.W.2d 705 (Tex.1987), remains viable to the extent it addresses provisions for insurance and that it is controlling in this regard. In Fireman's Fund, the contract provided:
The Contractor shall protect the Owner and Architect-Engineer against all liabilities, claims or...
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Getty Oil Co. v. Insurance Co. of North America
...and (4) specific issues were precluded by collateral estoppel. The court of appeals affirmed on the theory of res judicata. 819 S.W.2d 908 (Tex.App.--Houston 1991). We affirm the judgment of the court of appeals in part, reverse in part, and remand the cause to the trial court for further I......