Mitchell's, Inc. v. Friedman

• Decision Date: 05 June 1957
• Docket Number: No. A-6101,A-6101
• Citation: 157 Tex. 424,303 S.W.2d 775
• Parties: MITCHELL'S, Inc., Petitioner, v. Ben FRIEDMAN, Respondent.
• Court: Texas Supreme Court

Page 775

303 S.W.2d 775

157 Tex. 424

MITCHELL'S, Inc., Petitioner, v. Ben FRIEDMAN, Respondent.

No. A-6101.

Supreme Court of Texas.

June 5, 1957.

Rehearing Denied July 17, 1957.

Morris I. Jaffe, Dallas, for petitioner.

Elihu Berwald and Max Rosenfield, Dallas, for respondent.

Stephen L. Mayo, Dallas, amicus curiae, for Dallas Real Estate Board.

Niemann & Babb, Austin, amicus curiae, for Texas Real Estate Association, Inc.

WALKER, Justice.

This is a summary judgment case. The principal question is whether the original lessee in a building lease, who had assigned the leasehold estate with an agreement to remain responsible for the performance of all the lease terms, is obligated by the provisions of the lease to indemnify the lessor against liability for injuries received on the leased premises by a customer of the assignee.

Mitchell's Inc., petitioner, is the lessor, and Ben Friedman, respondent, is the original lessee. The lease in question, which was executed by these parties in 1949, provides for a term of ten years and covers a brick building on Lovers Lane in Dallas which petitioner had previously caused to be erected. Paragraph 7 of the lease reads as follows:

'7th. That the Lessor shall not be liable to Lessee or to Lessee's employees, patrons, or visitors, for any damage to person or property, caused by the act of negligence of any other tenant of said demised premises, or due to the building on said premises or any appurtenances thereof being improperly constructed, or being or becoming out of repair, nor for any damages from any defects or want of repair of any part of the building of which the leased premises form a part, but the Lessee accepts such premises as suitable for the purposes for which same are leaed and accepts the building and each and every appurtenance thereof, and waives defects therein and agrees to hold the Lessor harmless from all claims for any such damage.'

In 1952 the lease was assigned by respondent to George Cokins, and the following year was transferred by Cokins to B. A. Brockles. Each of the assignments is covered by an agreement executed by petitioner, respondent and the assignee. These agreements provide inter alia that petitioner consents to the assignment, that the assignee assumes all of the obligations imposed upon the lessee by the terms of the lease, and that respondent shall remain bound for the performance of such obligations.

One Leonard Zobel, while in the building as a customer of Brockles, was injured when struck by plaster and lathing which fell from the ceiling. Zobel instituted a damage suit against petitioner, respondent, Brockles and the architect and contractors who constructed the building. The petition alleges that the air conditioning ducts, the plaster and lathing surrounding same, and the ceiling of the building were negligently constructed, that the defects were or should have been known to petitioner, respondent and Brockles, and that each of the defendants was negligent in various respects. Petitioner thereupon filed a cross action against respondent, Cokins and Brockles, asserting that under the provisions of the lease and the subsequent agreements executed by the parties, said three defendants are obligated to hold petitioner harmless from any damages which might be recovered by Zobel.

The trial court concluded that respondent could not be liable to Zobel under the facts alleged, and accordingly dismissed plaintiff's suit as to respondent. The propriety of this order has not been questioned. Respondent then filed a motion for and was granted a summary judgment on petitioner's cross action, and the Court of Civil Appeals affirmed. 294 S.W.2d 740. Since respondent agreed to remain bound for the performance of all the provisions of the lease, there is no merit in his contention that he is merely a surety for the payment of the rent. The question then is whether the indemnity agreement covers Zobel's claim. We have concluded that it does, and consequently that respondent was not entitled to a summary judgment.

It will be noted that Zobel was a patron of Brockles, but was not an employee, patron or vistor of respondent, at the time he was injured. Respondent contends that the provisions of paragraph 7 of the lease, when strictly construed against petitioner as required by the rule of strictissimi juris, extend only to claims for damages sustained by respondent or his employees, patrons or visitors.

According to the opinion in Smith v. Scott, Tex.Civ.App., 261 S.W. 1089 (no writ), the cardinal rule for the construction of indemnity contracts is that the indemnitor is entitled to have the undertaking strictly construed in his favor. The only authority there cited is 31 C.J. p. 427, Sec. 19, which reads as follows:

'After the intention of the parties or the scope of the indemnitor's undertaking has been determined by the ordinary rules of construction, the rule of strictissimi juris applies, that is, that the indemnitor is entitled to have his undertaking as thus determined strictly construed, and that it cannot be extended by construction or implication beyond the terms of the contract, especially where the contract was prepared by the indemnitee. * * * '

The rule as announced in the Smith case is quoted in Texas Jurisprudence and has been reiterated in subsequent opinions. 23 Tex.Jur. Indemnity, Sec. 7, p. 526; International-Great Northern R. Co. v. Lucas, Tex.Civ.App., 70 S.W.2d 226 (reversed 128 Tex. 480, 99 S.W.2d 297); Kramer v. Linz, Tex.Civ.App., 73 S.W.2d 648 (no writ); Fidelity & Deposit Co. of Maryland v. Reed, Tex.Civ.App., 108 S.W.2d 939 (no writ); Rublee v. Stevenson, Tex.Civ.App., 161 S.W.2d 528 (no writ). And in the related field of suretyship, we have said by way of dictum that the contract will be 'strictly construed' so as to impose on the surety only such obligations as clearly come within its terms, and will not be extended by construction or implication. Standard Acc. Ins. Co. v. Knox, 144 Tex. 296, 184 S.W.2d 612.

It is somewhat misleading to say that an indemnity agreement must be strictly construed in favor of the indemnitor and against the indemnitee. Although the distinction has not been frequently noted, the doctrine of strictissimi juris is not a rule of construction but is a principle of substantive law which is applicable after the intention of the parties has been ascertained by ordinary rules of construction. See note to Houston Fire & Casualty Ins. Co. v. E. E. Cloer, General Contractor, 5th Cir. 217 F.2d 906; Covey v. Schiesswohl, 50 Colo. 68, 114 P. 292; Marshall-Wells, Co. v. Tenney, 118 Or. 373, 244 P. 84, 45 A.L.R. 1382; American Chain Co. v. Arrow Grip Mfg. Co., 134 Misc. 321, 235 N.Y.S. 228; 42 C.J.S. Indemnity § 8, p. 574. In determining the rights and liabilities of the parties, therefore, their intention will first be ascertained by rules of construction applicable to contracts generally. At this point neither party is favored over the other simply because their agreement is one of indemnity. After the intention of the parties has been determined, however, the doctrine of strictissimi juris applies and the liability of the indemnitor under his contract as thus interpreted will not be extended beyond the terms of the...