Jarvis v. Ashland Oil, Inc.

• Decision Date: 05 June 1985
• Docket Number: No. 84-1280,84-1280
• Citation: 478 N.E.2d 786,17 Ohio St.3d 189
• Parties: , 17 O.B.R. 427 JARVIS, Plaintiff, v. ASHLAND OIL, INC., Appellant; Union Boiler Company, Appellee.
• Court: Ohio Supreme Court

Page 189

17 Ohio St.3d 189

478 N.E.2d 786, 17 O.B.R. 427

JARVIS, Plaintiff, v. ASHLAND OIL, INC., Appellant Union Boiler Company, Appellee.

No. 84-1280.

Supreme Court of Ohio.

June 5, 1985.

Syllabus by the Court

1. Where the parties to a contract have made an effective choice of the forum law to be applied, the Restatement of the Law 2d, Conflict of Laws (1971) 561, Section 187(2), will not be applied to contravene the choice of the parties as to the applicable law. (Schulke Radio Productions, Ltd. v. Midwestern Broadcasting Co. [1983], 6 Ohio St.3d 436, 453 N.E.2d 683 followed.)

2. Where the law of the chosen state sought to be applied is concededly repugnant to and in violation of the public policy of this state, the law of Ohio will only be applied when it can be shown that this state has a materially greater interest than the chosen state in the determination of the particular issue. (Restatement of the Law 2d, Conflict of Laws [1971] 561, Section 187[b], construed.)

On November 8, 1979, a complaint was filed by plaintiff, Arthur R. Jarvis, against the defendant-appellant, Ashland Oil, Inc. ("Ashland"). On January 22, 1980, Ashland filed its answer to said complaint. A third-party complaint was filed by Ashland on August 6, 1982, against third-party defendant-appellee, Union Boiler Company ("Union"). Subsequently, Union filed a motion for summary judgment which was granted by the trial court.

In his complaint, Jarvis alleged that on or about October 3, 1979 at Ashland's plant located near North Tonawanda, New York, he sustained injuries to his "right neck and ear" and, in addition, first-degree burns. Jarvis was employed by Union. Union, a West Virginia corporation, licensed and qualified to do business in Kentucky, Ohio, Pennsylvania, New York and Minnesota, contracted with Ashland for work to be performed by Union at various refineries owned by Ashland in all of the above-listed states. Ashland is a Kentucky corporation with its principal place of business being Ashland, Kentucky. Jarvis is a resident of Ohio.

On February 6, 1978, Union and Ashland entered into a written contract whereby Union was to provide labor, supervision, tools and certain materials as requested by Ashland for work to be performed by Union at Ashland's facilities, including the North Tonawanda, New York plant. The contract provided, inter alia, for an indemnification clause whereby Union agreed to indemnify Ashland for any injuries arising out of the work to be performed by Union. Specifically, clause nine of the agreement, designated "Indemnity," provided, in pertinent part:

" * * * In addition, Contractor [Union] will indemnify and hold Ashland harmless against any claims and liability for personal injuries, including any claims and liability for death resulting therefrom and including any expense incurred in defending against such claims and suits, of all employees of Contractor, and of Contractor's subcontractors if any, occurring in the course of performance of the Work."

The contract also included clause fifteen, titled "Miscellaneous," which provided in part that: "This contract shall be construed and the legal relations of the parties hereto shall be determined in accordance with the laws of the State of Kentucky." It is undisputed that Jarvis was not a party to the contract between Ashland and Union.

Pursuant to the above-quoted provisions of the contract between the parties to the matter which is now before us (Ashland and Union), Ashland filed its third-party complaint against Union seeking judgment " * * * for all sums that may be adjudged against * * * Ashland Oil, Inc., in favor of * * * Arthur Jarvis, together with the reasonable costs incurred in defending this action * * *." Union filed its motion for summary judgment contending that it was entitled to judgment as a matter of law. In support of its motion, Union argued that R.C. 2305.31 declares that a contractual provision requiring the contractor-promisor (Union) to indemnify the promisee (Ashland) for damages resulting from the negligence of the promisee is against public policy in Ohio and is void. The trial court granted summary judgment to Union on this basis and the court of appeals affirmed.

The cause is now before this court pursuant to the allowance of a motion to certify the record.

Casimir T. Adulewicz, Steubenville, for plaintiff Arthur R. Jarvis.

Allan Sherry and Gary W. Smith, Woodsfield, for appellant.

Joseph J. Bruzzese, Sr., Steubenville, for appellee Union Boiler Co.

DOUGLAS, Justice.

This case, at first blush, appears to present us with a classic conflict of laws question. Upon further examination, however, it is clear that the resolution of the question presented to us for review is neither complicated nor difficult.

To summarize, Ashland is a Kentucky corporation; Union is a West Virginia corporation. Arthur R. Jarvis, plaintiff below, is an Ohio resident who was injured while working for Union on an Ashland job in the state of New York. The principal parties to this appeal, Ashland and Union, had entered into a contract and agreed in explicit terms that the laws of Kentucky would govern the legal relationship of the parties. Thus, the question arises as to how this contract affects the suit of Jarvis in an Ohio court when one of the major provisions of the contract (indemnity) is concededly against the public policy of this state (see R.C. 2305.31), but is perfectly valid under the law of Kentucky.

The answer is that for purposes of this appeal between these two parties, Jarvis has no direct interest. This court recognizes the desirability of protecting the rights and needs of Ohio citizens and we do not treat that responsibility lightly. However, under these circumstances we are called upon to determine whether...