Redfern v. R.E. Dailey & Co.

• Decision Date: 22 January 1986
• Docket Number: Docket No. 73542
• Citation: 146 Mich.App. 8,379 N.W.2d 451
• Court: Court of Appeal of Michigan — District of US
• Parties: Pauline K. REDFERN, Executrix of the Estate of Roy Redfern, Deceased, Plaintiff, v. R.E. DAILEY & COMPANY, Chemineer, Inc., and Wayne County Board of County Road Commissioners, Defendants, and UNION CARBIDE CORPORATION, Defendant, Third-Party Plaintiff-Appellee, Cross-Appellant, v. MIDWEST MECHANICAL CONTRACTORS, INC., Third-Party Defendant-Appellant, Cross-Appellee.

Page 451

379 N.W.2d 451

146 Mich.App. 8

Pauline K. REDFERN, Executrix of the Estate of Roy Redfern, Deceased, Plaintiff, v. R.E. DAILEY & COMPANY, Chemineer, Inc., and Wayne County

Board of County Road Commissioners, Defendants, and UNION CARBIDE CORPORATION, Defendant, Third-Party Plaintiff-Appellee, Cross-Appellant, v. MIDWEST MECHANICAL CONTRACTORS, INC., Third-Party

Defendant-Appellant, Cross-Appellee.

Docket No. 73542.

Court of Appeals of Michigan.

Submitted May 9, 1985.

Decided Oct. 7, 1985.

Released for Publication Jan. 22, 1986.

Dykhouse & Wise by Robert A. Marsac and Joseph E. Hurley, Detroit, for Union Carbide Corporation.

Plunkett, Cooney, Rutt, Watters, Stanczyk & Pedersen, P.C. by Fred W. Gerow and Ernest R. Bazzana, Detroit, for Midwest Mechanical Contractors, Inc.

Before WAHLS, P.J., and J.H. GILLIS and EVERETT, ^* JJ.

WAHLS, Presiding Judge.

Midwest Mechanical Contractors, Inc., appeals as of right from a judgment in favor of Union Carbide Corporation finding contractual indemnity and awarding attorney fees.

This case arose out of an accidental death in connection with warranty repair work at the Wyandotte Waste Water Treatment Facility. Midwest had been subcontracted to install a UNOX waste water treatment system. The design and manufacture of the UNOX was contracted to Union Carbide, which in turn contracted the design and manufacture of agitator components to Chemineer, Inc. Midwest installed the system and, pursuant to a contract with Union Carbide, was responsible for the warranty repair work.

Plaintiff's decedent, Roy Redfern, was an employee of Midwest and a supervisor of both the original installation of and the warranty repair work on the UNOX system. On April 30, 1976, Redfern was on the job site in connection with warranty repair work. A nonfunctioning agitator was discovered to have a broken component manufactured by Chemineer. Redfern sought to retrieve the component and was seriously injured when the agitator moved. His wounds were contaminated by the waste material in the agitator cell and he died 39 days later.

Plaintiff filed suit on April 28, 1977, seeking damages for the alleged wrongful death of her husband. Plaintiff settled her claim four years later on April 17, 1981. The parties stipulated that Redfern and Chemineer were partly negligent and Chemineer would pay $311,500. Union Carbide denied liability and negligence, but agreed to contribute $141,500 toward the settlement. Claims against the general contractor and the Board of County Road Commissioners were dismissed with prejudice.

Of the amount paid by Union Carbide, $70,000 was contributed by Midwest. The remaining $71,500 was subject to a later determination in Union Carbide's third-party indemnity action against Midwest. Union Carbide's third-party complaint alleged contractual indemnity. Prior to trial, Union Carbide moved to amend its complaint to include a theory of recovery based on breach of an implied warranty of workmanlike performance by Midwest. The motion was denied, as was Midwest's motion for summary judgment claiming that the indemnification agreement was void pursuant to M.C.L. Sec. 691.991; M.S.A. Sec. 26.1146(1).

Trial came on before the court, and a judgment of no cause of action was entered in favor of Midwest. The court found that Redfern alone was negligent, but concluded that his negligence could not be imputed to Midwest. Union Carbide then moved for a new trial or, in the alternative, a judgment notwithstanding the verdict. ¹ The trial court granted judgment NOV, concluding that its prior opinion was in error and Redfern's negligence could be imputed to Midwest through the doctrine of respondeat superior.

I

Midwest first argues that the court erred reversibly in denying Midwest's motion for summary judgment. Midwest argues that, because the indemnity agreement between Midwest and Union Carbide was broad enough to provide indemnification of Union Carbide for liability arising out of its sole negligence and, to that extent was void, ² and because the void section could not be severed from the rest of the agreement, the entire indemnity agreement was void.

The indemnity agreement between Midwest and Union Carbide provides:

"Contractor [Midwest] shall indemnify and save harmless Owner [Union Carbide], its employees and agents, against all claims, liabilities, losses, damages and expenses, of every character whatsoever, for bodily injury, sickness and/or disease, including death at any time resulting from such bodily injury, sickness and/or disease sustained by any person (including but not limited to employees of Owner, of Contractor or of a Subcontractor of Contractor) while in, on or about the premises of Owner or the site of the Work, if or where such injury, sickness, disease and/or death arose out of or was in any way connected with the Work or with the performance of or failure to perform the Work, whether or not such injury, sickness, disease and/or death was caused by, resulted from or was in any way connected with the negligence of Owner, its employees, or agents." (Emphasis added.)

In Tope v. Waterford Hills Road Racing Corp, 81 Mich.App. 591, 594-596, 265 N.W.2d 761 (1978), lv. den. 405 Mich. 822 (1979), this Court considered a contract with language similar to that emphasized above and concluded that, construing the indemnity clause strictly against the indemnitee, the language was unequivocal in exempting the indemnitee from liability for damages sustained by the plaintiff because of the indemnitee's own negligence. However, the Court was not faced with the question of the applicability of the language to liability for damages caused by the indemnitee's sole negligence. ³ The question appears to be one of first impression.

The indemnity agreement in this case occupies a middle ground between other indemnity agreements in construction contracts reviewed by this Court. On the one side are agreements which expressly provide that indemnity does not extend to liability for damages caused by the indemnitee's sole negligence. This Court has obviously approved such agreements and has concluded that they provide indemnity against liability for damages caused by the indemnitee's concurrent negligence. Harbenski v. Upper Penninsula Power Co., 118 Mich.App. 440, 325 N.W.2d 785 (1982), lv. den. 417 Mich. 1078 (1983); Giguere v. Detroit Edison Co., 114 Mich.App. 452, 319 N.W.2d 334 (1982), lv. den. 414 Mich. 961 (1982); Hayes v. General Motors Corp., 106 Mich.App. 188, 308 N.W.2d 452 (1981). On the other side are agreements which expressly provide for indemnification against liability for damages caused in whole or in part by the indemnitee's negligence. In such cases, this Court has severed the offending language relating to the indemnitee's sole negligence and upheld the contract as it related to the indemnitee's concurrent negligence. Robinson v. A.Z. Shmina & Sons Co., 96 Mich.App. 644, 293 N.W.2d 661 (1980); Ford v. Clark Equipment Co., 87 Mich.App. 270, 274 N.W.2d 33 (1978); Robertson v. Swindell-Dressler Co., 82 Mich.App. 382, 267 N.W.2d 131 (1978), lv. den. 403 Mich. 812 (1978).

The court below relied on the latter cases and ruled that the indemnity agreement between Midwest and Union Carbide was void "insofar as the language relates to one hundred percent negligence on the part of the indemnitee, * * * [b]ut insofar as it relates to the concurrent negligence, that is, the negligence of one percent to ninety-nine percent on the part of the indemnitee, it is valid". Midwest is correct in noting that the court did not and could not sever offending language as was done in the above cases. Nonetheless, we approve the result reached by the trial court.

The issue here is very similar to that presented to this Court in Klann v. Hess Cartage Co., 50 Mich.App. 703, 214 N.W.2d 63 (1973). In that case, the parties had a lease agreement providing that the lessee would not be liable for loss of, or damage to, the leased equipment, "however caused". Plaintiff sued for loss of the equipment, alleging that the loss was due to the defendants' negligence. This Court stated,

"Plaintiff contends that the words 'however caused' could be construed to exempt defendants from liability for gross negligence or intentional acts of misconduct. If this clause was so construed, it would, to that extent, violate public policy. But here, plaintiff alleges only negligence. An indemnity provision which would be invalid if applied to indemnify a person from liability for his wilful and wanton wrongdoing may, nevertheless, be validly applied to indemnify him from liability for his negligent acts. Thomas v. Atlantic C L R Co., [201 F.2d 167, 170 (CA 5, 1953) ]." Klann, supra, p. 709, 214 N.W.2d 63.

We find the analysis of Klann applicable to the instant case. Union Carbide has denied that it was solely negligent (or negligent at all, for that matter) and has not sought to interpose the indemnity agreement in the event of a finding of sole negligence. Union Carbide is allowed every presumption in favor of a legal purpose for the indemnity agreement, Roland v. Kenzie, 11 Mich.App. 604, 611, 162 N.W.2d 97, 62 A.L.R.3d 912 (1968). We will not construe the agreement so as to make it illegal if such construction can be reasonably avoided. Millen v. Potter, 190 Mich. 262, 273, 157 N.W. 101 (1916); Roland, supra. See Parliament Construction Co. v. Beer Precast Concrete, Ltd., 114 Mich.App. 607, 615, 319 N.W.2d 374 (1982). We are persuaded that the indemnity agreement is not void on its face. Accordingly, Midwest's motion for summary judgment pursuant to GCR 1963, 117.2(1) was properly denied.

II

Midwest next argues that the trial court erred in imputing Roy Redfern's negligence to Midwest, his employer, and in determining that Union Carbide's liability was not the result of its sole negligence.

We note initially that the trial court made the factual finding that Union Carbide was not negligent with...