Safeway Stores, Inc. v. Chamberlain Protective Services, Inc.

• Decision Date: 15 September 1982
• Docket Number: No. 79-1043.,79-1043.
• Citation: 451 A.2d 66
• Parties: SAFEWAY STORES, INC., Appellant, v. CHAMBERLAIN PROTECTIVE SERVICES, INC., Appellee.
• Court: D.C. Court of Appeals

451 A.2d 66

SAFEWAY STORES, INC., Appellant, v. CHAMBERLAIN PROTECTIVE SERVICES, INC., Appellee.

No. 79-1043.

District of Columbia Court of Appeals.

Argued November 5, 1981.

Decided September 15, 1982.

William L. Fallon, with whom Arthur B. Hanson, Washington, D. C., was on brief, for appellant.

Bernard J. Honig, Washington, D. C., was on brief, for appellee.

Before NEBEKER, PRYOR and BELSON, Associate Judges.

PRYOR, Associate Judge:

This is an appeal from an order denying appellant recovery of attorney's fees and expenses. The case presents two related issues: whether one joint tort-feasor, who defended not only claims concerning the tortious conduct of an employee of the other joint tort-feasor but also allegations of its own separate and independent negligence, may recover attorney's fees and expenses (1) under an exception to the rule against recovery of attorney's fees, or (2) under an implied obligation of indemnity. We conclude that neither theory entitles appellant to recover attorney's fees and expenses. Accordingly, we affirm.

I

The present action arose from a suit for damages brought by Cornell Simpson¹ against Safeway Stores, Inc., and Chamberlain Protective Services, Inc.² for an alleged assault and battery by a security guard employed by Chamberlain under an oral contract and working at a Safeway store in Northwest Washington in 1974. Simpson alleged a dual theory of liability against both defendants: (1) that they were directly liable for negligently hiring, training, and supervising the guard, and (2) that they were vicariously liable for the tortious conduct of the guard. In response to Safeway's written request to Chamberlain to defend the allegations against Safeway, Chamberlain refused on the ground that Chamberlain did not have an obligation to indemnify Safeway. Safeway then cross-claimed against Chamberlain for indemnification or contribution for the amount, if any, recovered by Simpson and for costs and reasonable attorney's fees. Safeway argued that Chamberlain was an independent contractor primarily liable for any loss or damage suffered by Simpson since (1) the damage resulted from the guard acting within the scope of his employment with Chamberlain without participation or ratification by Safeway, or (2) the damage resulted from the primary negligence of Chamberlain in hiring, training and supervising the employee. After a trial the jury found both defendants liable in the amount of $6,000 but denied Safeway's claim for indemnification.

Pursuant to Super.Ct.Civ.R. 50(b) Safeway successfully moved for judgment non obstante veredicto (n.o.v.) regarding its direct liability for hiring, training, and supervising the guard. However, the trial judge denied Safeway's motion for judgment n.o.v. regarding its vicarious liability for the actions of the guard. The court found that there was sufficient evidence from which the jury could find that Safeway had the right to control the guard in his duties, thereby creating a master/servant relationship which served as the basis for Safeway's vicarious liability for the guard's tortious conduct. In addition, the trial court granted judgment n.o.v. for Safeway regarding its cross-claim for indemnification, finding an implied obligation for Chamberlain to indemnify Safeway. Safeway then filed a motion for attorney's fees and expenses in the amount of $9,872.86, to be paid by Chamberlain as part of its obligation of indemnity. The trial court denied that motion on the ground that Safeway, as a joint tort-feasor with Chamberlain, was not entitled to recover attorney's fees. The court explained:

Safeway's request is based upon an exception to [the American] rule that permits an award of attorney's fees and costs against a party who wrongfully involves a third party in litigation.

On the facts of this case, involving joint tort-feasors, the Court, in the exercise of its discretion, concludes that an award of fees to Safeway is not warranted.

The denial of attorney's fees and expenses is the only issue on appeal.

II

It is a general rule that a plaintiff litigating a civil action must bear his own attorney's fees and expenses absent a contractual or statutory basis for liability. See, e.g., Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 246-55, 95 S.Ct. 1612, 1616-1620, 44 L.Ed.2d 141 (1975); AFSCME v. Ball, D.C.App., 439 A.2d 514 (1981); Biddle v. Chatel, D.C.App., 421 A.2d 3, 7 (1980).³ A well recognized exception to this "American Rule"⁴ — that each party bear his own expenses of litigation — allows a party wrongfully involved in litigation with a third party to recover from the wrongdoer the expenses of such litigation, including attorney's fees. Id.; Brem v. United States Fidelity & Guaranty Co., D.C.App., 206 A.2d 404, 407 (1965).⁵ To enjoy the benefit of this narrow exception, a party must show that:

(1) [t]he plaintiff must have incurred attorney's fees in the prosecution or defense of a prior action;

(2) the litigation ordinarily must have been with a third party and not with the defendant in the present action; and

(3) the plaintiff must have become involved in such litigation because of some tortious act of the defendant. [Biddle v. Chatel, supra at 7].

Appellant contends that it is entitled to attorney's fees under this exception.⁶ We disagree. First, Safeway did not incur attorney's fees in the defense of a prior action. The mere fact that the attorney's fees were incurred in the same action, rather than in a prior one, may not preclude a party from recovering under this exception in every case. See Prentice v. North American Title Guaranty Corp., 59 Cal.2d 618, 621, 30 Cal.Rptr. 821, 823, 381 P.2d 645, 647, 30 Cal.Rptr. 821, 823 (1963) (en banc); 25 C.J.S. Damages § 50e, at 789 (1966). As we pointed out in Biddle, the California courts have applied Prentice only where the alleged wrongful party responsible for the original litigation would have escaped all liability (except costs) but for the award of attorney's fees. Biddle v. Chatel, supra at 8. Here, that is not the case. Chamberlain has not escaped liability but rather has paid Simpson the full $6,000 jury award. Therefore, the special circumstance in Prentice is not present here. However, just as in Biddle, we need not decide here whether considerations of judicial economy warrant us in overlooking this requirement since Safeway fails to meet the third requirement of the Biddle exception — that some tortious act of Chamberlain wrongfully involved Safeway in the litigation. Under the wrongful involvement in litigation exception, a party is considered to have committed a wrongful act whether he did it personally or through an agent for whom he is responsible. Turner v. Zip Motors Inc., 245 Iowa 1091, 1099, 65 N.W.2d 427, 430 (1954); 25 C.J.S. Damages § 50e, at 788 (1966). The author of the tortious act in the case at bar was an employee for whom both Safeway and Chamberlain were responsible under the doctrine of respondeat superior, a ruling that Safeway does not challenge on appeal. Since it is immaterial to liability whether each principal committed the tort personally or through an agent, Safeway, just as much as Chamberlain, can be said to have committed the wrongful act. Thus, Safeway's argument that it was a passive or secondary tort-feasor does not bring it within this exception since both Safeway and Chamberlain were passive or secondary tort-feasors, the primary or active tort-feasor being the guard. Therefore, appellant cannot prevail on the theory that tortious acts of Chamberlain wrongfully involved it in this litigation.

III

We turn now to appellant's second contention that it is entitled to attorney's fees under Chamberlain's implied obligation of indemnity.⁷ The precise issue before us is whether an indemnified tort-feasor can recover attorney's fees from his codefendant tort-feasor under an implied obligation of indemnity where the indemnitee successfully defended, in part, allegations of its own negligence, but unsuccessfully defended allegations of its vicarious liability for the acts of the employee of the indemnitor.

Where the right of indemnity arises under a contract or is implied by law, several states follow the rule that the indemnified party may recover attorney's fees and expenses incurred in resisting the indemnified claim. See, e.g., Perkins State Bank v. Connolly, 632 F.2d 1306, 1315 (5th Cir. 1980); Cormier v. Rowan Drilling Co., 549 F.2d 963, 971 n. 9 (5th Cir. 1977); Bagby v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 491 F.2d 192, 198 n. 9 (8th Cir. 1974); A. C. Israel Commodity Co. v. American-West African Line, Inc., 397 F.2d 170, 172 (3d Cir.), cert. denied sub nom. Lavino Shipping Co. v. American-West African Line, Inc., 393 U.S. 978, 89 S.Ct. 446, 21 L.Ed.2d 439 (1968); McDonough Construction Co. v. H. B. Fowler & Co., Inc., 281 F.Supp. 90, 95 (E.D.La.1968); General Electric Co. v. Mason & Dixon Lines, Inc., 186 F.Supp. 761, 762 (W.D.Va.1960); 27 AM.JUR. Indemnity § 27 (1940); 41 Am.Jur.2d Indemnity § 36 (1968); 42 C.J.S. Indemnity §§ 13d, 24 (1944). The purpose of allowing recovery of attorney's fees for certain indemnified tort-feasors is to reimburse "the defense costs of a party held constructively liable `because of the actual default of another for whose benefit the defense [was] really conducted . . ." Davis v. Air Technical Industries, Inc., 22 Cal.3d 1, 5, 148 Cal.Rptr. 419, 421, 582 P.2d 1010, 1012 (1978) (en banc), quoting Chesapeake & Ohio Canal Co. v. County Commissioners, 57 Md. 201, 226 (1881) (emphasis added). In some circumstances, however, a person may recover common law indemnity but not recover attorney's fees. Epley v. S. Patti Construction Co., 228 F.Supp. 1, 5 (N.D.Iowa 1964). Several courts have held that a party may recover attorney's fees and expenses from another party under an implied indemnity obligation only when he is defending solely against an act of the other party and...