Ohio Valley Gas, Inc. v. Blackburn, 4-182A19

• Decision Date: 07 March 1983
• Docket Number: No. 4-182A19,4-182A19
• Citation: 445 N.E.2d 1378
• Parties: OHIO VALLEY GAS, INC., Appellant (Defendant Below), v. Prentice D. BLACKBURN, Administrator of the Estate of Katherine R. Blackburn, Deceased, Appellee (Plaintiff Below), and City of Sullivan, Indiana, Appellee (Defendant Below).
• Court: Indiana Appellate Court

Page 1378

445 N.E.2d 1378

OHIO VALLEY GAS, INC., Appellant (Defendant Below), v. Prentice D. BLACKBURN, Administrator of the Estate of

Katherine R. Blackburn, Deceased, Appellee (Plaintiff Below),

and

City of Sullivan, Indiana, Appellee (Defendant Below).

No. 4-182A19.

Court of Appeals of Indiana,

Fourth District.

March 7, 1983.

William A. Wick, John J. Sullivan, White, Raub, Reis, Wick & Riegner, Indianapolis, Rabb Emison, Emison, Emison, Doolittle & Kolb, Vincennes, for appellant.

Joe D. Black, Ramsey & Black, Vincennes, Hansford C. Mann, Mann, Chaney, Johnson & Goodwin, Terre Haute, for Prentice D. Blackburn, Adm Harry A. Wilson, Jr., Wilson & Kehoe, Indianapolis, Paul B. Ledford, Ledford, Kirchoff, Doll & Webster, Vincennes, R.D. Zink, Meils, Zink, Thompson, Page & Dietz, Indianapolis, for City of Sullivan.

CONOVER, Judge.

Ohio Valley Gas, Inc. (OVG) appeals a $700,000 jury verdict. Decedent Katherine R. Blackburn was killed when one of OVG's gas lines in the city of Sullivan (City) exploded. This suit resulted.

We affirm.

ISSUES

This appeal presents the following issues:

1. Whether the trial court erred in refusing to admit an edited version of a loan receipt agreement when the editing was done by the offering party.

2. Whether the trial court erred in refusing to admit prior inconsistent statements of City's employees Robins, Unger and Lewis.

3. Whether the trial court erred in admitting photographs of unbarricaded gas service lines of OVG other than the service line at issue.

4. Whether the trial court erred in admitting into evidence certain federal and state pipeline safety regulations.

5. Whether the trial court erred in refusing to give OVG's instruction on the inapplicability of such pipeline safety regulations.

6. Whether the trial court erred in dismissing OVG's cross-claim against City.

FACTS

The facts most supportive of the verdict in this case are as follows:

In 1965, OVG installed an above-ground gas line in the alley behind the Girls' Country Building located in the City to bring natural gas service to that building. The gas line entered the building through a coal chute window. No special barricade was erected in front of this line, although some protection was afforded by a cast iron drain pipe, possibly a stone step, and a window air conditioner above it, probably none of which had been installed by OVG to protect its exposed line.

Because of the "Blizzard of '78", a large amount of ice and snow accumulated in the alley behind the Girls' Country Building. One February afternoon while a city snow removal crew was operating a tractor with a front end loader clearing the alley of ice and snow near the exposed gas line, deceased's daughter heard loud noises from the basement like "a dropping of pots and pans or somethin', hittin', metal against metal, hitting each other and falling on the floor." Later an odor of gas permeated the building, and decedent reported the gas leak to OVG. It immediately sent two gas service men to the scene. They checked the basement where the gas meter was located. One of them came up and advised decedent and her daughter he was going to see if he could shut off the gas. He told them to leave the building and stay outside.

Decedent told her daughter she was going to warn Mrs. Bean, another small store owner located at the rear of the building. When the gas man entered the alley, he waived to the tractor operator. As he did so, an explosion occurred which killed four people, including decedent. A brick wall fell on her. Decedent's surviving husband as administrator on behalf of himself and his three daughters (survivors) brought the instant suit. OVG contended at trial (a) the front end loader struck either the riser or the gas line, or (b) the loader lifted the ice encasing the gas line causing it to leak. The City contended (a) its front end loader did not operate closer than 18 inches to the gas line, and (b) the City's participating employees were aware of the gas line's disturbance and notified their supervisor.

The City and survivors entered into a written $150,000 loan receipt agreement. It was filed with the trial court and served upon OVG's counsel thirty days before trial began. OVG filed no motion to sever the City from the trial, but several times during trial offered as evidence an edited version of the agreement from which OVG's counsel had excised all the parts it considered detrimental to its defense of the action. The trial court refused to admit this edited version as evidence.

I.

OVG first argues the trial court erred by refusing its tenders of the edited version.

After the loan receipt agreement was served upon it, OVG filed a motion in limine proposing to offer as evidence an edited version of the agreement from which it had excised "the dollar figures and inflammatory recitals of the preamble." Its motion was made contingent upon the issuance of an order by the trial court prohibiting the survivors and the City from disclosing to the jury in any manner the material OVG had deleted. The survivors and the City in turn, filed motions in limine requesting the court to prohibit any mention whatever of the loan receipt agreement.

Before voir dire of prospective jurors began, the trial court issued an order prohibiting any mention of the loan receipt agreement during voir dire or opening statements, overruled OVG's motion in limine, and deferred its ruling on the admissibility of the loan receipt agreement into evidence.

OVG offered its edited version of the agreement conditioned upon the court's issuing of a prohibitory order three times, first when the City called two of its employees to testify, next during OVG's case in chief when it requested permission to question the City's former street commissioner who had testified earlier and was still available, and during its case in chief when OVG proposed to call the City's mayor for such purpose. At a hearing out of the presence of the jury the City's two witnesses denied any knowledge of the loan receipt agreement. The mayor, however, testified he executed the agreement and was familiar with its contents. OVG never established the former street commissioner ever had knowledge of it.

We first note the unexpurgated version of the loan receipt agreement in this case is almost a verbatim recital of the loan receipt agreement in Otis, infra. Only the names, factual recitals and amount of the loan have been changed, the operative language being identical.

OVG's edited version deleted the following passages from the document executed by the survivors and the City:

WHEREAS, Sullivan recognizes the facts are such to provide a substantial possibility that the estate will be awarded judgment against each defendant in the aforesaid action; Sullivan further recognizes that any judgment would in all probability be for a large sum of money, and that any judgment entered in favor of the estate would probably be in excess of Three Hundred Thousand ($300,000.00) Dollars; and ...

WHEREAS, the estate believes that its position in the aforesaid action is strong but recognizes that the ultimate disposition of said action, including appeals, is probably at least three (3) years in the future, particularly inasmuch as Ohio Valley Gas Company, Inc., has pursued a policy of delay and noncooperation since the very inception of the aforesaid litigation; and has failed to make any meaningful offer of compromise to settle the estate's claims against it; and

WHEREAS, the estate recognizes that any judgment in its favor would not have to be satisfied until the ultimate disposition of said litigation; and its investigation to date indicates that negligence of Ohio Valley Gas Company, Inc., was a proximate cause of the aforesaid explosion, and that Ohio Valley Gas Company, Inc., is liable in the aforesaid action; and

WHEREAS, the estate is desirous of reaching an agreement which would enable it to receive money at the present time without jeopardizing the estate's claim against Ohio Valley Gas Company, Inc., alleged in the aforesaid action; and the City of Sullivan desires to limit its liability for the death of Katherine R. Blackburn without shirking its responsibility to her family, and without affecting its rights to indemnity from Ohio Valley Gas Company, Inc.; and

WHEREAS, the estate is willing to compromise all claims against both defendants for a total of Three Hundred Thousand ($300,000.00) Dollars and Sullivan offered to pay One Hundred and Fifty Thousand ($150,000.00) Dollars of said amount, and Ohio Valley Gas Company, Inc., refused to pay its one-half of such a settlement; and

WHEREAS, Ohio Valley Gas Company, Inc., has been furnished a copy of this agreement before its execution, and has again been given the opportunity to compromise its claim for the sum of One Hundred and Fifty Thousand ($150,000.00) Dollars, and Ohio Valley Gas Company, Inc., has refused to make such compromise; ....

In addition, all references to the dollar amount of the loan in the operative portion of the agreement were deleted.

Loan receipt agreements are admissible in evidence for impeachment purposes when one party to the loan agreement calls another party thereto as a witness to testify on its behalf. Gray, Adm. v. Davis Timber and Veneer Corp., (1982) Ind.App., 434 N.E.2d 146, 148; State v. Thompson, (1979) Ind.App., 385 N.E.2d 198, 210. OVG, however, never tendered the complete loan receipt agreement to the trial court, it only tendered its edited version thereof.

Loan receipt agreements have been looked upon with approval as a legitimate settlement device for many years. State v. Ingram, (1981) Ind., 427 N.E.2d 444, 446; American Transport Co. v. Central Indiana Rwy. Co., (1970) 255 Ind. 319, 264 N.E.2d 64, 66; Gray, Adm., supra, 434 N.E.2d at 148; Erskine v. Duke's GMC, Inc., (1980) Ind.App., 413 N.E.2d 305, 307; Dias v. Daisy-Heddon, (1979) Ind.App., 390 N.E.2d 222, 228; Burkett v. Crulo Trucking...