Pittsburgh Steel Co. v. Patterson-Emerson-Comstock, Inc.

• Decision Date: 26 May 1961
• Docket Number: INC,PATTERSON-EMERSON-COMSTOC
• Parties: PITTSBURGH STEEL COMPANY, Appellant, v., Original Defendant, and Eichleay Corporation, Additional Defendant.
• Court: Pennsylvania Supreme Court

Page 185

171 A.2d 185

404 Pa. 53

PITTSBURGH STEEL COMPANY, Appellant, v. PATTERSON-EMERSON-COMSTOCK, INC., Original Defendant, and Eichleay Corporation, Additional Defendant.

Supreme Court of Pennsylvania.

May 26, 1961.

Rehearing Denied June 20, 1961.

Gilbert J. Helwig, Reed, Smith, Shaw & McClay, Francis St. Clair O'Leary, Pittsburgh, for appellant.

H. A. Robinson, Dickie, McCamey, Chilcote & Robinson, Pittsburgh, for original defendant.

William A. Challener, Jr., Pittsburgh, for additional defendant, Frank J. Brown, Jr., Pittsburgh, of counsel.

Before CHARLES ALVIN JONES, C. J, and BELL, MUSMANNO, BENJAMIN R. JONES, COHEN, BOK and EAGEN, JJ.

BELL, Justice.

This appeal was taken from the judgment non obstante veredicto in favor of the defendant and additional defendant in an action of assumpsit. Plaintiff, Pittsburgh Steel Company, the present appellant, owned the property on which the construction was taking place. Plaintiff seeks indemnity for a sum it had been required to pay in settling an earlier action brought by an employee of the additional defendant (Eichleay Corporation) against plaintiff-appellant.

Originally the plaintiff entered into a contract with defendant-Patterson for the installation by defendant of a blooming mill on plaintiff's premises. The contract contained the following clause:

'Insurance Clause: Contractor [Patterson] will indemnify, save harmless and defend buyer [the present plaintiff-appellant] from all liability for loss, damage or injury to person or property in any manner arising out of or incident to performance of this order and will furnish buyer with proper evidence that contractor is insured against such liability.

'Contractor will indemnify, save harmless and defend buyer from any and all claims, demands or suits made or brought against buyer on account of any of the terms or provisions of any applicable Workmen's Compensation law and will furnish buyer with the proper evidence that contractor is insured against all liability made under such law.'

Defendant-Patterson was to perform the electrical work. In order to complete the general construction and mechanical installation of the mill, Patterson entered into a contract with the additional defendant--Eichleay Corporation. The contract between Patterson and Eichleay contained the identical clause with respect to insurance which was in Patterson's above-mentioned contract with plaintiff.

Before any work was commenced on the mill, all the parties met and agreed upon certain safety precautions. Among the precautions to be taken were the installation by Patterson of red lights to warn when workers were in a position of danger, and the installation by Eichleay of blocks on the crane rails. In spite of these oral understandings or agreements these safety meassures were habitually ignored by all of the parties.

As a result of the negligent operation of a crane by an employee of the present plaintiff, one of Eichleay's workmen was severely injured. He brought suit in a Federal District Court against the present plaintiff. Eichleay was joined as additional defendant. During the course of the trial but before the jury rendered a verdict, the present plaintiff voluntarily settled with the workman-plaintiff for the sum of $87,615.54. The case was dismissed with prejudice.

The present suit was thereafter commenced in the Court of Common Pleas of Allegheny County by the plaintiff (Pittsburgh Steel Company) against Patterson for indemnity under the provisions of the hereinabove mentioned contract. Patterson joined Eichleay as additional defendant. The jury returned a special verdict in favor of plaintiff and against both defendants ¹ in the sum of $129,326.62, which included legal fees, expenses and interest. Motions for judgment non obstante veredicto by Patterson and Eichleay were granted. This appeal followed the entry of judgmentnon obstante veredicto.

Unquestionably the Workmen's Compensation Act of June 2, 1915, P.L. 736, § 301(a) as amended, 77 P.S. § 431, precluded the injured worker from suing Eichleay, his employer. He was also precluded from suing Patterson, his statutory employer, under § 203 of the Act, 77 P.S. § 52. However, the present plaintiff (Pittsburgh Steel Company) as the property owner was not so insulated by the Workmen's Compensation Act and was subject to suit in a common law action in trespass: McDonald v. Levinson Steel Co., 302 Pa. 287, 153 A. 424.

Plaintiff's principal contention is that under the broad indemnity clause above quoted, Patterson is under a duty to indemnify plaintiff for sums paid by it to Eichleay's injured workman even though plaintiff's own negligence was legally the cause of the injury. Contracts indemnifying a party against his own negligence are valid. Siegel Co. v. Philadelphia Record Co., 348 Pa. 245, 35 A.2d 408; Cannon v. Bresch, 307 Pa. 31, 160 A. 595. However, the law is well settled that the intention to include within the scope of an indemnity contract, a loss due to the indemnitee's own negligence, must be expressed in clear and unequivocal language. Tidewater Field Warehouses, Inc. v. Fred Whitaker Co., 370 Pa. 538, 88 A.2d 796; Darrow v. Keystone 5, 10, 25, $1.00 Stores, Inc., 365 Pa. 123, 74 A.2d 176; Schroeder v. Gulf Refining Co. (No. 2), 300 Pa. 405, 150 A. 665; Perry v. Payne, 217 Pa. 252, 66 A. 553, 11 L.R.A.,N.S., 1173. Cf. Siegel Co. v. Philadelphia Record Co., 348 Pa. 245, 35 A.2d 408.

Factually, the leading case of Perry v. Payne, supra, is almost on all fours with the instant case. In that case the contract between the parties contained a clause indemnifying the property owner 'from all ² loss, cost or expense * * * arising from accidents to mechanics or laborers employed in the construction of said work, or to persons passing where the work is being constructed.' During the course of the construction one of the contractor's workmen was killed through the negligence of one of the property owner's employees. The property owner was compelled to respond in damages for the death. He then brought an action in assumpsit on the indemnity bond against the contractor. This Court affirmed the entry of a judgment of nonsuit. In construing the contract clause in question this Court, speaking through Mr. Justice Mestrezat aptly said (217 Pa. at pages 259, 260, 262, 263, 66 A. at pages 555, 556, 557):

'The question presented here has not arisen or been determined in any of the reported decisions of this court. In other jurisdictions, however, the inclination is decidedly against construing a contract of this character as indemnifying the indemnitee against his own negligence, and it is there held that a contract will not be so construed unless express language requires it. In Mynard, etc., v. Syracuse, etc., R. R. Co., 71 N.Y. 180, 27 Am.Rep. 28, it is held that 'every presumption is against an intention to contract for immunity for not exercising ordinary diligence in the transaction of any business, and hence the general rule is that contracts will not be so construed unless expressed pressed in unequivocal terms.' In Mitchell v. Southern Ry. Co., 74 S.W. 216, 24 Ky. Law Rep. 2388, Mr. Justice Paynter, speaking for the court, says: 'If a doubt existed as to its [clause of indemnity] meaning, the court would resolve that doubt against the contention that the contract was intended to indemnify appellee against its own negligence. Every presumption is against such intention. * * * In Perkins v. New York Central R. R. Co., 24 N.Y. 196, 82 Am.Dec. 281, the court said: 'A party who claims exemption from liability for the negligence of his servants or agents must undoubtedly base his claim upon the express words of his contract. It will not be presumed sumed in his favor.''

'In Manhattan Ry. Co. v. Cornell, 54 Hun 292, 7 N.Y.S. 557, affirmed by the Court of Appeals of New York, 130 N.Y. 637, 29 N.E. 151, a contractor, employed to construct an extension to the station platform of a railway, indemnified the railway company against 'all loss, cost or damage * * * from any damages arising from injuries sustained by mechanics, laborers or other persons, by reason of accident or otherwise.' During the progress of the work a laborer in the employ of the contractor was killed by an engine of the railway company for which the widow of the laborer recovered damages against the company. Suit was then brought by the company against the contractor or his indemnity contract, but it was held that the contract did not indemnify the company against the negligence of its employees. In the opinion of the court it is said: 'For, while the language of this part of the contract is very general, it cannot reasonably be so construed as to impose upon the contractors the obligation to protect the plaintiff against the carelessness or negligence of persons in its own employment. What the party designed and intended by this part of the agreement was to indemnify the plaintiff against liability for any damages or injuries that might be sustained by persons in the employment of the contractors in the...