Pennsylvania R. Co. v. Kent

• Decision Date: 21 May 1964
• Docket Number: No. 19658,19658
• Citation: 198 N.E.2d 615,14 A.L.R.3d 434,136 Ind.App. 551
• Parties: , 14 A.L.R.3d 434 The PENNSYLVANIA RAILROAD COMPANY, Appellant, v. Ned B. KENT, Appellee.
• Court: Indiana Appellate Court

Page 615

198 N.E.2d 615

136 Ind.App. 551, 14 A.L.R.3d 434

The PENNSYLVANIA RAILROAD COMPANY, Appellant, v. Ned B. KENT, Appellee.

No. 19658.

Appellate Court of Indiana, In Banc.

May 21, 1964.

William A. Wick, Carl T. Reis, George C. Forrey, III, Edward B. Raub, Jr., and Jacob S. White, Indianapolis, for appellant.

Hickam & Hickam, Spencer, for appellee.

HUNTER, Presiding Justice.

This action was brought by the appellee in the court below praying for declaratory judgment construing an indemnifying agreement in a real property lease.

Both the appellee (plaintiff below) and the appellant railroad company (defendant below) filed motions for judgment and decree on the pleadings in the trial court. The court decided the issue for the appellee plaintiff by sustaining his motion and overruling appellant's motion, and entering judgment thereon.

The appellant's assignments of errors are two in number; they are as follows:

(1) The court erred in sustaining appellee's (plaintiff below) motion for judgment and decree on the pleadings.

(2) The court erred in overruling appellant's (defendant below) motion for judgment and decree on the pleadings.

The facts as shown by the complaint and answer, which we deem to be true and correct, inasmuch as both parties moved for judgment on the pleadings in the court below, are as follows:

One Robert Cooksey was an employee of the appellee; the appellee was a lessee of the appellant railroad company and adjacent to the leased property was appellant's railroad track upon which appellant's railroad cars were permitted to stand, including cars for the receipt or shipment of property by the appellee. Cooksey, while at work for the appellee and while standing in one of appellant railroad's gondola type cars, was injured as a result of the appellant's negligence. In his complaint for declaratory judgment the appellee Kent recited the facts relative to injury sustained by Cooksey. Cooksey alleged that the appellant caused four empty cars to be 'bumped' against the car in which he was working and that he thereby received injuries through the negligence of the appellant railroad company.

According to the pleadings at bar the appellee's employee Cooksey filed his cause of action against the appellant railroad company in the Cook County, Illinois Circuit Court which case is pending. The appellant tendered the defense of said suit to the appellee and demanded that appellee protect, indemnify, and save the appellant railroad company harmless from all damage and expense incidental to suit pursuant to provisions of a lease contract between the parties. The appellee denies any liability, under the lease, to defend the suit or to reimburse and save the appellant harmless from any loss, damage or expense resulting from the Cook County Circuit Court case.

The pertinent portions of the trial court's judgment are set forth as follows:

'IT IS THEREFORE CONSIDERED, ORDERED, ADJUDGED AND DECREED by the court that under the contract between the plaintiff Ned B. Kent and the defendant The Pennsylvania Railroad Company * * * that the plaintiff Ned B. Kent is not liable or obligated to the defendant The Pennsylvania Railroad Company to protect, indemnify or save defendant harmless from any loss, damage or expense which defendant may suffer or for which defendant may be held liable as the result of any injuries which may have been sustained by Robert Cooksey as the result of personal injuries which he may have sustained on or about the 13th day of October, 1958, as alleged in the complaint pending on behalf of said Robert Cooksey in the Circuit Court of Cook County in the State of Illinois, * * * that the plaintiff Ned B. Kent is not liable, bound or obligated to the defendant The Pennsylvania Railroad Company under said contract to defend said action against the defendant The Pennsylvania Railroad Company now pending in the Circuit Court of Cook County * * * or any other action which may hereafter be instituted by or on behalf of the said Robert Cooksey or any other person against The Pennsylvania Railroad Company * * *'

The portions of the lease contract between the appellant railroad company and the appellee, Ned B. Kent (d/b/a individually as Kent Soil Service) are as follows:

'It is understood and agreed that Lessor will permit the standing of cars on the track along the northwesterly side of the land covered by this LEASE, for the receipt or shipment of property by Lessee subject, nevertheless, to the rules and regulations prescribed from time to time in Lessor's filed tariffs; and (as such location is not the usual or normal place for the loading or unloading of freight) further subject, nevertheless, to the following terms and conditions which are assented and agreed to by Lessee:' * * *

'(1) * * *

'(2) * * *

'(3) Lessee shall protect, indemnify and save harmless Lessor from all loss, damage or expense, as well as claims and actions, which Lessor may suffer, or for which it may be held liable, as a result of any act or omission of Lessee, its officers, employees, or others, upon or about the cars or track in connection with the business or activities of Lessee; and shall especially protect, indemnify and save harmless Lessor from all loss, damage and expense, as well as claims and actions, which Lessor may suffer, or for which it may be held liable, resulting from injury (including death) to Lessee, Lessee's officers, agents and employees, or to other persons who are at the time of the injury upon or about the cars or track in connection with the business or activities of Lessee, arising in any manner or from any cause whatsoever.' (our emphasis)

The real property leased by the appellant railroad company to the appellee Kent comprised approximately 24,753 square feet which real estate is adjacent to the railroad right of way. The railroad right of way located on the northwesterly side of and opposite the appellee Kent's place of business contained a portion of the main line of the Indianapolis-Vincennes branch of said railway and also team tracks and passing sidings and it was while working in one of the appellant railroad company's cars which was standing on the appellant's switch track adjacent to but not within the boundaries of the leased land, that the appellee's employee Cooksey was injured. For the purposes of the determination of the issues involved in this case, Cooksey's injuries are admitted to be the result of the sole negligence of the appellant railroad company in the operation of its train. The train was entirely under the control of the railroad company through its employees. Kent had no control over the train, the operation thereof, the tracks, or the cars. Cooksey's injuries were sustained without any fault or negligence of the appellee Kent or his employees.

Thus, we are directed in this appeal to a construction of the provisions of the above set forth lease contract. The sole question presented in the case at bar calls for a consideration of the extent, scope and legal enforceability of the indemnification clause of the real estate contract involved in this appeal.

Therefore, the questions presented by the assignment of error are (1) whether the trial court in the declaratory judgment action was correct in sustaining the appellee's motion for judgment and decree on the pleadings, and (2) whether or not the trial court was correct in overruling appellant's motion for judgment and decree on the pleadings.

The appellant cites the case of Consolidated Coal and Lime Company v. Mercer (1896), 16 Ind.App. 504, 510, 44 N.E. 1005, 1007 as authority for a strict construction of the language of the contract and that the terms of said contract may not be reduced or lessened. The issue there hinged on an instruction given by the trial court re the question of extraneous facts as applicable to a written contract and laid down the legal principle that the terms of a written contract may not be reduced by extrinsic evidence 'unless such reduction shall appear * * * to have been known to it at the time to be essential to the accomplishment of the object for which appellee made the contract.' Therefore, it is not applicable to the issue here where we are concerned with the language of a lease contract as it pertains to indemnity and liability of the parties in a tort action. Likewise, inapplicable is the case of Doxey's Estate v. Service (1902), 30 Ind.App. 174, 65 N.E. 757, for there the issues had to do (1) with the execution of an oil lease wherein the lease did not bear the signatures and acknowledgments of the lessees, and (2) with the proposition that successors in interest by purchase of said leases were held to be merely sureties in action for drilling deferment rentals due under the lease contract.

The appellant cites the case of Sargeant v. Leach (1911), 47 Ind.App. 318, 321, 94 N.E. 579 in support of its contention that the strict terms of the contract must be applied to the facts in this case. In that case the court laid down the general principle that '* * * a plain, unambiguous contract must be construed by the court according to its express terms.' It should be pointed out, however, that the questions raised in that case were relative to the effect of a contract for the payment of royalties for all salable coal under a certain mining lease contract and the questions presented were three in number, they were: (1) was the appellee entitled to show the royalties for sale of coal extracted under said lease contract upon the basis of a stated price per hundred bushels of coal, (2) were the appellants entitled to a reduction for pea and slack coal of the total busheis of coal mined and sold, and (3) did the court err in excluding certain evidence offered by the appellants to show a long established practice and usage as a basis for construction of the contract that had originally been placed upon the lease by the original parties?

It will be readily noted,...