Hillman v. Leland E. Burns, Inc.

• Decision Date: 17 April 1989
• Citation: 257 Cal.Rptr. 535,209 Cal.App.3d 860
• Court: California Court of Appeals
• Parties: Kirk HILLMAN, Cross-Complainant and Appellant v. LELAND E. BURNS, INC., Cross-Defendant and Respondent. A040988.

Page 535

257 Cal.Rptr. 535

209 Cal.App.3d 860

Kirk HILLMAN, Cross-Complainant and Appellant v. LELAND E. BURNS, INC., Cross-Defendant and Respondent.

A040988.

Court of Appeal, First District, Division 2, California.

April 17, 1989.

Raymond M. Buddie and Christopher M. Dolan, Natkin & Weisbach, San Francisco, for cross-complainant and appellant Kirk Hillman.

Dorothy L. Barth and A. Byrne Conley, Gibbons, Lees, Schaefer & Edrington, Walnut Creek, for cross-defendant and respondent Leland E. Burns, Inc.

PETERSON, Associate Justice.

Cross-complainant Kirk Hillman appeals from the postjudgment orders denying his motion for entry of judgment on his cross-complaint and granting cross-defendant and respondent Leland E. Burns, Inc.'s motion to tax costs. We reverse.

PROCEDURAL/FACTUAL BACKGROUND

We have adduced the following from the appellant's appendix submitted in lieu of the clerk's and reporter's transcripts:

In 1982, defendant Woodbridge Preservation Group (owner), a California limited partnership, and respondent Leland E. Burns, Inc. (contractor), a licensed contractor, entered into an agreement for the construction of owner's project. The contract, a standard American Institute of Architects' short form construction agreement between owner and contractor, contained a clause requiring contractor to indemnify appellant Kirk Hillman (architect), as the architect, under certain circumstances "against all claims, damages, losses and expenses including attorneys' fees" attributable, inter alia, to death caused in whole or in part by the contractor's negligence.

Plaintiffs commenced a wrongful death action grounded in negligence against architect and others following a construction accident in which plaintiffs' decedent, an employee of the contractor, was killed. Architect, in turn, cross-complained, as here relevant, for indemnity against contractor, who was not named in the complaint. The cross-complaint alleged that contractor's negligence was responsible for the alleged wrongful death.

The jury returned a plaintiffs' verdict, finding owner's and contractor's negligence to be the legal cause of plaintiffs' injury and apportioning liability between the two at 40 and 60 percent, respectively. The jury specifically exonerated architect. Judgment was entered accordingly.

Architect subsequently moved for judgment on the cross-complaint and filed a memorandum of costs, seeking $69,715 in attorney fees from contractor based on the indemnification provision of the construction contract. Contractor moved to tax costs, asserting that the terms of the agreement barred architect from recovering attorney fees. The trial court determined that architect was a third party beneficiary under the contract, but was not entitled to attorney fees under its terms because the contract excluded indemnification for professional negligence. It accordingly denied architect's motion for entry of judgment on the cross-complaint and granted contractor's motion for an order taxing costs. This appeal followed.

DISCUSSION

I

Initially, contractor contends that the appeal is taken from a nonappealable order. However, as architect correctly points out in his reply brief, postjudgment orders have been expressly made appealable by statute. (Code of Civ.Proc., § 904.1, subd. (b).)

Contractor further asserts that the appeal has been submitted to us on an inadequate record because architect did not provide a reporter's transcript of the proceedings. Specifically, contractor raises two points.

First, it argues that without a more complete record, the copy of the contract at issue contained in the architect's appendix cannot be verified in that it is not a trial exhibit. We call contractor's attention to the California Rules of Court, rule 5.1, subdivision (i)(1): "Filing an appendix constitutes a representation by counsel that the appendix consists of true and correct copies of the papers in the superior court file. Willful or grossly negligent filing of an appendix containing nonconforming copies is an unlawful interference with the proceedings of the reviewing court, and subjects the counsel filing the brief, and the party represented, to monetary and any other appropriate sanctions." As contractor does not contend that the copy of the contract included in the architect's appendix is nonconforming, we find its argument to be without merit.

Second, contractor, more by innuendo than by direct assertion, contends that the trial court's interpretation of the contract at issue was based on conflicting extrinsic evidence, requiring us to review its decision under the substantial evidence rule. Since we are precluded from so doing because of the absence of a reporter's transcript, contractor asserts that the appeal is fatally flawed and that the decision must be upheld.

However, under rule 52 of the California Rules of Court, this court must presume that the record on appeal "includes all matters material to a determination of the points on appeal" in the absence of augmentation proceedings. The presumption is applicable to judgment roll appeals, and therefore by extension to appeals submitted on an appellant's appendix, where "the error claimed by appellant does appear on the face of the record." (Dumas v. Stark (1961) 56 Cal.2d 673, 674, 16 Cal.Rptr. 368, 365 P.2d 424; see generally, 9 Witkin, Cal.Procedure (3d ed. 1985) Appeal, §§ 271-273, pp. 280-284 and cases cited therein.)

Here, contractor did not request augmentation as provided by rule 5.1, subdivision (j); and as will be hereinafter discussed, error appears on the face of the record. "Therefore, this court must presume that the interpretation of the contract did not turn upon the credibility of extrinsic evidence and was a question of law and, accordingly, this court is not bound by the determination of the trial court." (LaCount v. Hensel Phelps Constr. Co. (1978) 79 Cal.App.3d 754, 771, 145 Cal.Rptr. 244.)

II

The principal issue before us is whether the trial court correctly construed the indemnification clause contained in the agreement between owner and contractor.

Article 10.10 of the construction agreement provides in relevant part: "The Contractor shall indemnify and hold harmless the Owner and the Architect and their agents and employees from and against all claims, damages, losses and expenses including attorneys' fees arising out of or resulting from the performance of the Work, provided that any such claim, damage, loss or expense (1) is attributable to bodily injury, sickness, disease or death, ... and (2) is caused in whole or in part by any negligent act or omission of the Contractor, ... regardless of whether or not it is caused in part by a party indemnified hereunder.... The obligations of the Contractor under this Paragraph 10.10 shall not extend to the liability of the Architect, his agents or employees arising out of (1) the preparation or approval of maps, drawings, opinions, reports, surveys, Change Orders, designs or specifications, or (2) the giving of or the failure to give directions or instructions by the Architect, his agents or employees provided such giving or failure to give is the primary cause of the injury or damage."

In denying architect's motion for entry of judgment on the cross-complaint and granting contractor's motion to tax, the trial court stated: "The Court finds that Defendant Hillman was sued by Plaintiffs on the grounds of professional negligence and it is manifest from the evidence presented and arguments rendered that professional negligence was Plaintiffs' principal contention as to Defendant Hillman. The Court finds that the jury herein rendered a special verdict finding Defendant Hillman not to have been negligent. Said Defendant has been awarded costs as against the parties against whom he prevailed, to wit: Plaintiffs. The Court further finds that the Defendant Hillman was a beneficiary for indemnity under the contract between Defendant contractor Burns and owners Woodbridge. However, it is clear that the indemnity specifically by exclusion did not extend to any liability of said Defendant Hillman for professional negligence under Article 10.10 of said contract. Therefore, the Court hereby denies Cross-Complainant Kirk Hillman's Motion for judgment as against Cross-Defendant Leland Burns. Further, the Court hereby grants Cross-Defendant Leland Burns' Motion to tax costs as against Cross-Complainant Kirk Hillman." (Emphasis deleted.)

Architect contends that the trial court erred as a matter of law by misconstruing and misapplying the indemnification clause. He argues that, under the clear and unambiguous language of the contract, he was entitled to indemnification for attorney fees because the fees were incurred as a result of contractor's negligent work performance that resulted in a death. He further asserts that the exclusion for professional negligence is limited to those situations where the architect is found to be liable. Here, architect argues, the trial court acknowledged the jury's verdict exonerating him from all liability. Therefore the exclusionary clause is inapplicable, and the trial court's determination internally inconsistent.

Contractor essentially contends that the clause is ambiguous, arguing that we therefore are compelled to accept the trial court's interpretation because it is "very reasonable."

With respect to indemnity provisions, our state Supreme Court has held that, "the question whether an indemnity agreement covers a given case turns primarily on contractual interpretation, and it is the intent of the parties as expressed in the agreement that should control. When the parties knowingly bargain for the protection at issue, the protection should be afforded. This requires an inquiry into the circumstances of the damage or injury and the language of the contract; of necessity, each case will turn on its own facts." (Rossmoor Sanitation, Inc. v. Pylon, Inc. (1975) 13 Cal.3d 622, 633, 119...