Metal Working Lubricants Co. v. IWC

• Citation: 746 N.E.2d 352
• Decision Date: 30 March 2001
• Docket Number: No. 49A04-0004-CV-141.,49A04-0004-CV-141.
• Parties: METAL WORKING LUBRICANTS COMPANY and North River Insurance Company as Subrogee of Metal Working Lubricants Company, Appellant-Plaintiff, v. INDIANAPOLIS WATER COMPANY, Appellee-Defendant.
• Court: Court of Appeals of Indiana

746 N.E.2d 352

METAL WORKING LUBRICANTS COMPANY and North River Insurance Company as Subrogee of Metal Working Lubricants Company, Appellant-Plaintiff, v. INDIANAPOLIS WATER COMPANY, Appellee-Defendant.

No. 49A04-0004-CV-141.

Court of Appeals of Indiana.

March 30, 2001.

Robert R. Clark, Maggie L. Smith, Sommer & Barnard, P.C., Indianapolis, IN, Attorneys for Appellant.

John C. Trimble, Richard K. Shoultz, Lewis & Wagner, Indianapolis, IN, Attorneys for Appellee.

OPINION

ROBB, Judge

Metalworking Lubricants Company and its insurer, North River Insurance Company (collectively referred to as "Metalworking Lubricants" where appropriate), appeal from the trial court's grant of summary judgment in favor of the Indianapolis Water Company ("IWC") on Metalworking Lubricants' complaint for negligence. We affirm.¹

Issue

Metalworking Lubricants raises the following restated issue for our review: whether IWC is entitled to summary judgment on Metalworking Lubricants' claims that sufficient water required for firefighting purposes was not available in the fire hydrants IWC serviced, causing injury to Metalworking Lubricants when a fire broke out at its facility and could not be immediately extinguished.

Facts and Procedural History

The parties agree that the following operative facts are undisputed: Metalworking Lubricants Company owns a wastewater and oil treatment facility located on South Senate Avenue in the City of Indianapolis. In the summer of 1996, a fire occurred at the facility which totally destroyed several parts of the facility and gave rise to this litigation.

IWC is a privately-owned water company providing the City of Indianapolis with water for domestic purposes pursuant to a franchise contract between IWC and the City. Metalworking Lubricants' facility was connected to various water mains and lines serviced by IWC, specifically, a water main which runs along Senate Avenue and one which runs along West Morris Street. In addition, several fire hydrants located near the facility are supplied with water from those water mains. In 1988, a shutoff valve near the juncture of the Senate Avenue and West Morris Street water mains had been closed which affected these mains and in turn, the fire hydrants located near Metalworking Lubricants' facility.

When Metalworking Lubricants' facility caught fire in 1996, there was an inadequate supply of water from those hydrants for use in fighting the fire at the facility. Additional measures had to be taken to fight the fire, which took several hours to bring under control. Metalworking Lubricants' facility sustained serious damage from the fire. Metalworking Lubricants' facility is insured by North River Insurance Company. North River paid over $1.8 million in insurance proceeds to Metalworking Lubricants for losses caused by the fire. Metalworking Lubricants also incurred additional losses of $500,000 that were not covered by insurance.

Thus, this action was commenced against IWC for negligent failure to inspect and maintain the water mains servicing the fire hydrants near Metalworking Lubricants facility, seeking to recover the sums paid by North River to Metalworking Lubricants, as well as Metalworking Lubricants' losses not covered by insurance. IWC answered, asserting immunity as an affirmative defense.

Metalworking Lubricants ultimately moved for partial summary judgment on the issue of IWC's entitlement to the affirmative defense of immunity. IWC also filed a motion for summary judgment. A hearing on both motions was held and separate orders were entered as to each motion. On January 24, 2000, an order denying Metalworking Lubricants' motion was entered. Several weeks later, an order was entered granting IWC's motion and entering final judgment in IWC's favor. Metalworking Lubricants now appeals.

Discussion and Decision

Metalworking Lubricants filed its motion for partial summary judgment in the trial court with respect to IWC's affirmative defense of immunity. IWC also filed a motion for summary judgment, alleging that it was entitled to summary judgment on Metalworking Lubricants' claims either because it had immunity or, in the alternative, because it owed no duty to Metalworking Lubricants. Because we find the issue of immunity to be dispositive, we address it exclusively.

I. Standard of Review

Our standard of review of a summary judgment order is well-settled: summary judgment is appropriate if the "designated evidentiary matter shows that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Ind. Trial Rule 56(C). Relying on specifically designated evidence, the moving party bears the burden of making a prima facie showing that there are no genuine issues of material fact and that the moving party is entitled to judgment as a matter of law. I/N Tek v. Hitachi Ltd., 734 N.E.2d 584, 586 (Ind.Ct.App.2000),trans. denied. If the moving party meets these two requirements, the burden shifts to the nonmovant to set forth specifically designated facts showing that there is a genuine issue for trial. Id. A genuine issue of material fact exists where facts concerning an issue which would dispose of the litigation are in dispute or where the undisputed material facts are capable of supporting conflicting inferences on such an issue. Gilman v. Hohman, 725 N.E.2d 425, 428 (Ind.Ct.App. 2000),trans. denied. Even if the facts are undisputed, summary judgment is inappropriate where the record reveals an incorrect application of the law to the facts. Id.

On appeal, we are bound by the same standard as the trial court, and we consider only those matters which were designated at the summary judgment stage. Interstate Cold Storage v. General Motors Corp., 720 N.E.2d 727, 730 (Ind.Ct. App.1999), trans. denied. We do not reweigh the evidence, but we liberally construe all designated evidentiary material in the light most favorable to the nonmoving party to determine whether there is a genuine issue of material fact for trial. Estate of Hofgesang v. Hansford, 714 N.E.2d 1213, 1216 (Ind.Ct.App.1999). The party that lost in the trial court has the burden to persuade the appellate court that the trial court erred. Id. A grant of summary judgment may be affirmed upon any theory supported by the designated materials. Bernstein v. Glavin, 725 N.E.2d 455, 458 (Ind.Ct.App.2000), trans. denied.

The fact that the parties make cross-motions for summary judgment does not alter our standard of review. Instead, we must consider each motion separately to determine whether the moving party is entitled to judgment as a matter of law. Freidline v. Civil City of South Bend, 733 N.E.2d 490, 493 (Ind.Ct.App.2000).

II. Immunity

Metalworking Lubricants filed a complaint against IWC alleging counts of negligence, breach of contract and implied warranty of merchantability, and breach of implied warranty of fitness and merchantability. In response, IWC filed an answer alleging, among other affirmative defenses, that Metalworking Lubricants' claims were "barred by any and all immunities concerning [IWC's] operations, concerning the handling, distribution or supply of water or water pressure." R. 19. Thereafter, the parties each filed a motion for summary judgment. Metalworking Lubricants' motion was denied; IWC's motion was granted, and final judgment was entered for IWC.

A. IWC as a Governmental Entity

The first question which must be answered in determining whether IWC is entitled to immunity is whether or not it qualifies as a "governmental entity." IWC is not a "governmental entity" as that term is defined in the Indiana Tort Claims Act. See Ind.Code §§ 34-6-2-49 and 34-6-2-110 (defining "governmental entity" as "the state or a political subdivision of the state" and "political subdivision" as a "(1) county; (2) township; (3) city; (4) town; (5) separate municipal corporation; (6) special taxing district; (7) state college or university; (8) city or county hospital; (9) school corporation; (10) board or commission of one (1) of the entities listed in subdivisions (1) through (9); (11) drug enforcement task force operated jointly by political subdivisions; (12) community correctional service program organized under IC 12-12-1; or (13) solid waste management district established under IC 13-21 or IC 13-9.5-2 (before its repeal)."). However, our supreme court has held that when private groups are "endowed by the state with powers or functions governmental in nature, they become agencies or instrumentalities of the state and are subject to the laws and statutes affecting governmental agencies and corporations." Ayres v. Indian Heights Volunteer Fire Dept., 493 N.E.2d 1229, 1235 (Ind.1986) (citing Evans v. Newton, 382 U.S. 296, 86 S.Ct. 486, 15 L.Ed.2d 373 (1966)). Thus, IWC, despite being a privately-owned entity, may nevertheless be considered a governmental instrumentality if it meets the above test.

In Ayres, a volunteer fire department was determined to be an instrumentality of local government and held to be protected by the Indiana Tort Claim Act along with the township that employed it. Id. at 1237. In dicta, the court noted that

Firefighting is a service that is uniquely governmental. The need to control, prevent, and fight fires for the common good of the community has been universally accepted as a governmental function and duty in this State and, as far as we can determine, in this Nation from its very beginning.... [W]e [do not] know of the existence in Indiana of any private enterprise in the business of fighting fires. This distinguishes the volunteer fire department from independent contractors in the business of paving streets, constructing school buildings or bridges, or many of the other private enterprises the government is sometimes called upon to hire to fulfill its governmental duties to the public. Those who pave streets, construct schools, or build bridges for hire by state or local

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