Safeway, Inc. v. Rooter 2000 Plumbing & Drain SSS
| Decision Date | 28 January 2013 |
| Docket Number | No. 30,196.,30,196. |
| Citation | 297 P.3d 347 |
| Parties | SAFEWAY, INC., Defendant/Cross–Claimant–Appellant, v. ROOTER 2000 PLUMBING AND DRAIN SSS, Defendant/Cross–Defendant–Appellee. |
| Court | Court of Appeals of New Mexico |
OPINION TEXT STARTS HERE
Madison, Harbour & Mroz, P.A., Gregory D. Steinman, Robert J. Sanchez, Albuquerque, NM, for Appellant.
Butt, Thornton & Baehr, P.C., Emily A. Franke, Jane A. Laflin, Albuquerque, NM, for Appellee.
{1} This case requires us to examine which version of New Mexico's anti-indemnity statute applies to an agreement between a contractor and a landowner: the version of the statute that was in force when the parties signed the agreement, or the amended version that was in force when the contractor performed the work and the accident occurred. We conclude that the version of the statute that was in effect when the contract was signed applies and that the statute voided the contractor's agreement to indemnify but not its agreement to defend and insure. We also conclude that notwithstanding the unenforceability of the parties' indemnification agreement, material issues of fact precluded entry of summary judgment on the landowner's claim of common law indemnification. Accordingly, we reverse in part and affirm in part.
{2} Safeway, Inc. (Safeway) owns a grocery store in Gallup, New Mexico. On March 10, 2005, Rooter 2000 Plumbing and Drain SSS (Rooter) installed a diaper changing table in the Safeway store. On April 8, 2006, Brianna DeWeese and her child (Plaintiffs) were injured when the baby changing table became dislodged and fell from the wall. In an amended complaint, Plaintiffs sued Safeway and Rooter alleging general negligence, negligence per se, breach of implied warranty, strict liability, and a claim under the doctrine of respondeat superior against Safeway. Safeway demanded a defense from Rooter's insurance company, but Safeway was not named by Rooter as an additional insured on its policy, and the insurance company denied Safeway's request. Rooter also declined to otherwise provide Safeway a defense.
{3} Safeway then filed a cross-claim against Rooter, alleging that Rooter was in breach of the Standard Service Provider Terms and Conditions Agreement (Agreement) between them that was in effect when Rooter installed the diaper changing table. Safeway sought indemnification and damages pursuant to the contract, common law indemnification, and contribution from Rooter. The relevant provision of the Agreement states:
[Rooter] shall indemnify, defend and hold [Safeway] harmless from and against: any and all claims, losses, damages, liabilities, and expenses (including the costs of investigation and attorney's fees) in connection with any claim or cause of action arising from any act or omission of [Rooter,] its employees, agents, and representatives, in the performance of its obligations under this Agreement, except where the claim, loss or damage is caused by the sole negligence of [Safeway].
The Agreement also requires Rooter to maintain liability insurance and to name Safeway as an additional insured on that policy.
{4} Rooter and Plaintiffs settled before trial. Rooter filed a motion for summary judgment in the district court requesting that summary judgment be granted on all of Safeway's cross-claims, asserting that the agreement was void under NMSA 1978, Section 56–7–1 (). At the hearing on Rooter's motion for summary judgment, Plaintiffs abandoned their strict and vicarious liability claims against Safeway but retained their claim that Safeway had a non-delegable duty to maintain safe premises. Plaintiffs also represented that they would be willing to include other Defendants on the special verdict form for comparative fault purposes and would not require Safeway to pay any percentage of fault assigned by the jury to Rooter at trial. The district court granted Rooter's motion and dismissed all of Safeway's cross-claims. Safeway's claim for common law indemnification was dismissed because “[t]he Plaintiff is not seeking liability or damages from Safeway for Rooter's acts or omissions.” The court orally ruled in the hearing that the agreement to indemnify, defend, and insure was void as against public policy under Section 56–7–1. The district court did not address which version of the statute it was applying, nor did it include this in the written order.
{5} Safeway and Plaintiffs proceeded to trial on the remaining claims. The jury found that Safeway was negligent, awarded damages, and apportioned fault on a special verdict form assigning forty percent fault to Safeway and sixty percent fault to Rooter. Safeway appeals from the district court order granting summary judgment to Rooter on Safeway's cross-claims for indemnification and its defense costs.
{6} Safeway asserts that summary judgment was improper for four reasons: (A) the 2003 amended version of Section 56–7–1 applies to the Agreement because the events invoking the provisions of the Agreement occurred after 2003; (B) Rooter's agreement to indemnify is not barred by Section 56–7–1; (C) the doctrine of common law indemnification requires Rooter to indemnify Safeway independent of any effect of Section 56–7–1; and (D) the defense and insurance provisions in the Agreement are not barred by Section 56–7–1. “Summary judgment is appropriate where there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law.” Self v. United Parcel Serv., Inc., 1998–NMSC–046, ¶ 6, 126 N.M. 396, 970 P.2d 582. All issues raised in this appeal are legal issues, which we review de novo. Id.
{7} In 2003, between the signing of the agreement between Rooter and Safeway and the relevant events giving rise to Plaintiffs' lawsuit, Section 56–7–1 was amended. 2003 N.M. Laws, ch. 309, § 1. Section 56–7–1 had not been amended since its enactment in 1971. The original version stated in pertinent part:
Any provision, contained in any agreement relating to the construction, installation, alteration, modification, repair, maintenance, servicing, demolition ... of any real property, or any improvement of any kind ... by which any party to the agreement agrees to indemnify the indemnitee, or the agents and employees of the indemnitee, against liability, claims, damages, losses or expenses, including attorney fees, arising out of bodily injury to persons or damage to property caused by, or resulting from, in whole or in part, the negligence, act or omission of the indemnitee, or the agents or employees of the indemnitee, or any legal entity for whose negligence, acts or omissions any of them may be liable, is against public policy and is void and unenforceable[.]
Section 56–7–1 (1971) (emphasis added). The statute defined “indemnify” as:
without limitation, an agreement to remedy damage or loss caused in whole or in part by the negligence, act or omission of the indemnitee, the agents or employees of the indemnitee, or any legal entity for whose negligence, acts or omissions any of the foregoing may be liable.
Id.
{8} The 2003 version of the statute was amended to state in pertinent part:
A. A provision in a construction contract that requires one party to the contract to indemnify, hold harmless, insure or defend the other party to the contract, including the other party's employees or agents, against liability, claims, damages, losses or expenses, including attorney fees, arising out of bodily injury to persons or damage to property caused by or resulting from, in whole or in part, the negligence, act or omission of the indemnitee, its officers, employees or agents, is void, unenforceable and against the public policy of the state.
B. A construction contract may contain a provision that, or shall be enforced only to the extent that, it:
(1) requires one party to the contract to indemnify, hold harmless or insure the other party to the contract, including its officers, employees or agents, against liability, claims, damages, losses or expenses, including attorney fees, only to the extent that the liability, damages, losses or costs are caused by, or arise out of, the acts or omissions of the indemnitor or its officers, employees or agents; or
(2) requires a party to the contract to purchase a project-specific insurance policy, including an owner's or contractor's protective insurance, project management protective liability insurance or builder's risk insurance.
Section 56–7–1(A), (B) (2003) (emphasis added).
{9} The 2003 amendment also added that to “indemnify or hold harmless” included “any requirement to name the indemnified party as an additional insured in the indemnitor's insurance coverage for the purpose of providing indemnification for any liability not otherwise allowed in this section.” Section 56–7–1(E) (2003). The statute was again amended in 2005 by adding a new subsection dealing with state contracts, but not changing any other provision. Safeway asserts, and we agree, that those amendments do not affect the disposition of this case.
{10} In Windham v. L.C.I.2, Inc., 2012–NMCA–001, ¶ 8, 268 P.3d 528, we applied the version of Section 56–7–1 that was in effect when the parties signed the contract, although the statute had been subsequently amended because the parties did not dispute that the version of the statute that was in effect at the time of the formation of the contract controlled. Here, however, Safeway argues that although the original version of Section 56–7–1 was in effect at the time the parties signed the contract, the version as amended in 2003 applies because that was the version which was in effect at the time Rooter performed its work and the accident occurred. We disagree. Rather, we conclude that the version of the statute in effect at the time the contract is signed governs and explain in greater detail our reasons.
{11} Provided that a...
To continue reading
Request your trial
-
Safeway, Inc. v. Rooter 2000 Plumbing & Drain SSS
...that Safeway is found by the jury to be a passive tortfeasor." Safeway, Inc. v. Rooter 2000 Plumbing & Drain SSS, 2013–NMCA–021, ¶ 23, 297 P.3d 347 (citations omitted). Because the Court of Appeals determined that there were still genuine issues of material fact regarding whether Rooter owe......
-
Xto Energy, Inc. v. Atd, LLC
...indemnification still exists. See Response at 10. It cites Safeway, Inc. v. Rooter 2000 Plumbing & Drain SSS, 2013-NMCA-021, ¶ 21, 297 P.3d 347 ("Safeway I"), where the Court of Appeals of New Mexico held that "a party's indemnification agreement's unenforceability under Section 56-7-1 has ......