Home Ins. Co. v. Pinski Bros., Inc.
| Decision Date | 25 September 1972 |
| Docket Number | No. 12080,12080 |
| Citation | 500 P.2d 945,160 Mont. 219 |
| Parties | The HOME INSURANCE COMPANY, a corporation, Plaintiff and Appellant, v. PINSKI BROTHERS, INC., a corporation, et al., Defendants and Respondents. Kenneth K. KNIGHT, Counterclaimant, v. HOME INDEMNITY COMPANY, a corporation, Involuntary Plaintiff and Defendant to Counterclaims and Appellant. |
| Court | Montana Supreme Court |
Smith, Emmons & Baillie, Alexander, Kuenning, Hall & Miller, John Hall (argued), Great Falls, for appellant.
Church, Harris, Johnson & Williams, Jack L. Lewis (argued), Jardine, Stephenson, Blewett & Weaver, Scott & Linnell (argued), Wayne E. Linnell (argued), Great Falls, Loble, Picotte & Loble, Helena, for respondents.
In an action between an insurer and its insured involving the insurer's subrogation rights and the insured's right to damages for breach of the insurance contract, the district court of Cascade County, the Hon. Paul G. Hatfield, district judge presiding, granted summary judgment to the insured. The insurer now appeals from such summary judgment.
Plaintiff in the original action was The Home Insurance Company who paid off a property damage loss of approximately $135,000 resulting from a boiler explosion at the old Montana Deaconess Hospital in Great Falls and claimed subrogation to the rights of the hospital against those allegedly responsible. After various dismissals by the district court, the remaining defendants were (1) Pinski Bros., Inc., the mechanical contractor on the hospital remodeling project where the boiler explosion occurred, and (2) the architects on the project, Kenneth K. Knight and A. Andrew Van Teylingen, copartners, doing business as Knight & Van Teylingen.
The complaint of The Home Insurance Company alleged three counts of negligence against the architects which it claimed was the cause of the boiler explosion and the resulting property damage loss. The architects tendered defense of the action to The Home Indemnity Company, a wholly owned subsidiary of Plaintiff Home Insurance Company, with whom the architects carried a comprehensive liability policy. The Home Indemnity Company refused this tender, the architects hired their own defense counsel, and filed an answer containing, among other things, a 'Twelfth Defense, Counterclaim and Setoff' by one of the architects, Kenneth K. Knight. Therein Knight alleged that insurance coverage was afforded under the architects' comprehensive liability policy with The Home Indemnity Company; that such coverage constituted a defense against the claim of the parent company, The Home Insurance Company, and that The Home Indemnity Company was liable for the costs and expenses, including attorney fees, incurred in defending the action and prosecuting the counterclaim and setoff. It was stipulated that The Home Insurance Company and The Home Indemnity Company are one and the same corporate entity.
Subsequently the district court, in effect, granted summary judgment to The Home Indemnity Company against the architects on all issues of insurance coverage under their comprehensive liability policy, dismissed the 'Twelfth Defense, Counterclaim and Setoff' of architect Knight, and ordered the subrogation action of The Home Insurance Company against the architects to continue.
Upon appeal, we held that the alleged negligent design, supervision and inspection of the hot water heating system by the architects (Count I of the complaint by The Home Insurance Company against the architects) was within the coverage of the architects' comprehensive liability policy; we further held that Counts II and III of the complaint were not within the coverage of the architects' policy. We vacated the district court's findings of fact, conclusions of law and judgment from which the appeal was taken and remanded the case to the district court for consideration of the further issues raised by The Home Insurance Company's motion for summary judgment against architect Knight on his 'Twelfth Defense, Counterclaim and Setoff' and entry of appropriate findings, conclusions and judgment. See Home Insurance Company v. Pinski Bros., Inc., 156 Mont. 246, 479 P.2d 274.
Prior to hearing this former appeal, pretrial conferences were held by the district court at which time three developments pertinent to this appeal occurred: (1) The Home Insurance Company settled its claim against Pinski Bros., leaving the architects as the sole remaining defendants, (2) The Home Insurance Company offered to settle its claim against the architects within the limits of coverage claimed by them under their comprehensive liability policy with The Home Indemnity Company, leaving unsettled the then pending former appeal, (3) the architects were permitted to amend their answer by adding a 'Thirteenth Defense and Counterclaim', in essence the same defense, counterclaim and setoff, for the architects named in the caption of the suit as was contained in architect Knight's 'Twelfth Defense, Counterclaim and Setoff'.
Following this Court's decision on the former appeal, the architects moved (1) for summary judgment against The Home Insurance Company on its complaint against them, and (2) for partial summary judgment on the issue of liability against The Home Insurance Company and The Home Indemnity Company on the counterclaim aspects of the architects' twelfth and thirteenth defenses, counterclaims and setoffs.
Thereafter following hearing, the district court entered its 'Findings of Fact, Conclusions of Law, Order, Memorandum Opinion, and Summary Judgment'. Therein the district court of Cascade County as directed by this Court's order of remand in the former appeal, made findings of fact and conclusions of law with respect to Home Indemnity's motion for summary judgment against the architects. The district court found and concluded that The Home Indemnity Company had not pointed out or suggested to the district court any facts which required entry of summary judgment in favor of The Home Indemnity Company or which had not been ruled upon and decided by this Court in the earlier appeal, and that The Home Indemnity Company insured the architects for the liability claimed against them by Count I of the complaint of The Home Insurance Company. In addition, the district court (1) concluded that the controlling facts were undisputed and there was no genuine issue of material fact; (2) held that the architects could not be liable to The Home Insurance Company by reason of: (a) contributory negligence, (b) assumption of risk, (c) intervening cause and (d) insurance coverage under The Home Indemnity Company policy and its breach of duty to defendant under its policy; (3) entered summary judgment in favor of the architects on The Home Insurance Company's complaint against them; (4) entered partial summary judgment as to the issue of liability in favor of architect Knight on his twelfth defense and counterclaim against The Home Indemnity Company for all costs, expenses, attorney fees, etc., incurred on behalf of Knight in defending against the claim of Home Insurance and in prosecuting his claim for insurance coverage against Home Insurance; and (5) withheld until after the summary judgment became final the setting of a trial date for determination of the amount of damages to be awarded architect Knight for defense costs.
Home now appeals from this summary judgment.
We will summarize the underlying issues upon appeal in this manner:
1. Is there a genuine issue of material fact precluding summary judgment in favor of the architects on Home's complaint against them?
2. Is there a genuine issue of material fact precluding partial summary judgment on the issue of liability in favor of architect Knight against The Home Indemnity Company for his costs of defense herein?
3. Must Home pay all attorney fees and court costs incurred in this action?
Directing our attention to the first issue, we first review the basic requirements for granting a summary judgment. Rule 56(c), M.R.Civ.P., requires that a summary judgment shall be granted forthwith if:
'* * * the pleadings, depositions, answers to interrogatories, and admissions on file show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law. * * *'
The burden of establishing the absence of any issue of material fact is on the party seeking summary judgment. Roope v. The Anaconda Company, Mont., 494 P.2d 922; Byrne v. Plante, 154 Mont. 6, 459 P.2d 266. Where the record before the court discloses no genuine issue as to any material fact, the burden is upon the party opposing entry of summary judgment to present evidence of a material and substantial nature raising a genuine issue of material fact. Roope v. The Anaconda Company, supra; Flansberg v. Montana Power Company, 154 Mont. 53, 460 P.2d 263.
Applying these basic rules to the problem at hand we note that all other questions aside, the record before the Court discloses that...
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