Sersted v. American Can Co.

• Decision Date: 22 March 1982
• Docket Number: No. 79-C-182.,79-C-182.
• Citation: 535 F. Supp. 1072
• Parties: Gilane C. SERSTED, Plaintiff, v. AMERICAN CAN COMPANY, a New Jersey corporation, Defendant, MIDLAND-ROSS CORPORATION, an Ohio corporation, Midro Ltd., a foreign corporation, Northbrook Excess and Surplus Ins. Co., (Northbrook Ins. Co.), a foreign corporation, Harbor Insurance Company, a foreign corporation, Defendants, Third-Party Plaintiffs, and Cross-Claimants, v. ZURN INDUSTRIES, INC., Clarage Fan Division, a Pennsylvania corporation, Third-Party Defendant.
• Court: U.S. District Court — Eastern District of Wisconsin

535 F. Supp. 1072

Gilane C. SERSTED, Plaintiff, v. AMERICAN CAN COMPANY, a New Jersey corporation, Defendant, MIDLAND-ROSS CORPORATION, an Ohio corporation, Midro Ltd., a foreign corporation, Northbrook Excess and Surplus Ins. Co., (Northbrook Ins. Co.), a foreign corporation, Harbor Insurance Company, a foreign corporation, Defendants, Third-Party Plaintiffs, and Cross-Claimants, v. ZURN INDUSTRIES, INC., Clarage Fan Division, a Pennsylvania corporation, Third-Party Defendant.

No. 79-C-182.

United States District Court, E. D. Wisconsin.

March 22, 1982.

COPYRIGHT MATERIAL OMITTED

Jean Seaburg, Robert L. Habush, Habush, Habush & Davis, Milwaukee, Wis., for Sersted.

James R. Clark, Ronald M. Wawrzyn, Foley & Lardner, Milwaukee, Wis., for Midland-Ross Corp.

Thomas L. Smallwood, Borgelt, Powell, Peterson & Frauen, Milwaukee, Wis., for American Can Co.

John M. Swietlik, Kasdorf, Dall, Lewis & Swietlik, Milwaukee, Wis., for Zurn Industries, Inc.

MEMORANDUM AND ORDER

WARREN, District Judge.

On February 14, 1979, plaintiff filed an action in the Circuit Court of the State of Wisconsin in and for the County of Milwaukee seeking to recover damages for injuries she suffered during the course of her employment for defendant American Can Company (American). Plaintiff was injured on August 14, 1978 while working on a can-drying oven which had been sold to American by defendant Midland-Ross Corporation (Midland-Ross) in 1968. On March 19, 1979, Midland-Ross filed a petition for removal in this Court. On March 29, 1979, plaintiff filed a motion for remand. That motion was denied in an order dated May 14, 1979.

On March 11, 1980, Midland-Ross and its insurers filed a third-party complaint against Zurn Industries, Inc., Clarage Fan Division, the corporation which designed, fabricated, manufactured and sold to Midland-Ross a fan component used in the can-drying oven sold by Midland-Ross to American.

Four motions are currently pending before the Court. First, Midland-Ross seeks an order granting it summary judgment against American based on an indemnification agreement contained in Midland-Ross' formal proposal for sale. Second, Midland-Ross seeks an order compelling the production of certain statements taken by plaintiff's investigator and American Can's insurance adjuster. Third, Midland-Ross seeks an order extending the time by which it must complete plaintiff's deposition until thirty (30) days after the plaintiff's last surgical procedure. Fourth, the plaintiff seeks an order allowing her to enter into a Pierringer agreement with Zurn Industries, Inc., Clarage Fan Division, so as to obtain the effect of dismissing Clarage Fan from this lawsuit. These motions are the subject of this memorandum and order.

I. Motion for Summary Judgment

On October 2, 1968, Midland-Ross submitted a formal proposal to American for a can-drying oven. Included in that proposal was the following indemnification agreement:

Buyer shall use and shall require its employees to use all safety devices, guards, and proper safe operating procedures as set forth in manuals and/or instruction sheets furnished by Seller. Buyer shall not remove or modify any such device or guard or warning sign. During operation and especially when readjusting the equipment to accommodate new and different materials in process or when experimenting with new materials, Buyer shall not permit any person other than knowledgeable and skilled operating personnel to remain within 10 feet of any machine or accessory manufactured by Seller. If Buyer fails to strictly observe each and every one of the obligations set forth in this paragraph with regard to any of Seller's products, Buyer agrees to indemnify and save Seller harmless from any liability or obligation incurred by Seller to persons injured directly or indirectly in connection with the operation of such products. Buyer shall notify Seller promptly, and in any event within 30 days, of any accident or malfunction involving Seller's products which result in personal injury or damage to property and shall cooperate fully with Seller in investigating and determining the cause of such accident or malfunction. In the event that Buyer fails to give such notice to Seller and so cooperate, Buyer agrees to indemnify and save Seller harmless from any claims arising from such accident or malfunction.

On October 29, 1968, American accepted the Midland-Ross proposal with a purchase order which expressly incorporated the Midland-Ross proposal, including the indemnification provision. These two documents formed the purchase contract, which the parties agreed would be governed by Ohio law.

It is Midland-Ross' contention that the undisputed facts, as developed through deposition testimony, show that American Can failed to comply with three of the provisions of the indemnification agreement. Specifically, Midland-Ross claims American failed to comply with the provisions which: permitted only knowledgeable and skilled operating personnel to remain within ten feet of the oven; required American employees using the machine to use all safety devices, guards and proper safe operating procedures as set forth in manuals and/or instruction sheets furnished by Midland-Ross; and required American to notify Midland-Ross promptly, and in any event within 30 days, of any accident involving the oven, and to cooperate fully with Midland-Ross in investigating and determining the cause of the accident. The Court will discuss these provisions seriatim.

A. The Skilled-Employee Provision

Midland-Ross contends American Can failed to comply with the skilled-employee provision of the parties' indemnification agreement because at the time of the accident, plaintiff was only twenty years old and had less than one year total work experience at American. In support of its contention that plaintiff was unskilled, Midland-Ross discusses in detail plaintiff's work history, the tasks she usually performed and her limited experience on the ceiling oven.

American Can, of course, contends plaintiff did have the proper training to perform the task of clearing jams in ovens. It also discusses in detail her work history and the tasks she usually performed.

Summary judgment is appropriate only if it appears that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fitzsimmons v. Best, 528 F.2d 692, 694 (7th Cir. 1976); Fed.R.Civ.P. 56(c). All doubts as to the existence of an issue of material fact must be resolved against the movant. Moutoux v. Gulling Auto Electric, Inc., 295 F.2d 573, 577 (7th Cir. 1961). In passing on a motion for summary judgment, the trial court may only determine whether or not there exists a dispute as to a material issue of fact. It is not permitted to resolve that dispute. Carter v. Williams, 361 F.2d 189, 194 (7th Cir. 1966).

The briefs submitted by the parties on this issue lead the Court to conclude that a genuine issue of fact pertaining to plaintiff's knowledge and skills exists. Because the resolution of this issue calls for resolution of factual matters, summary judgment on this ground is not appropriate.

B. The Safety Manual Provision

The provision of the indemnification agreement pertaining to safety precautions to be taken by American Can states:

Buyer shall use and shall require its employees to use all safety devices, guards and proper safe operating procedures as set forth in manuals and/or instruction sheets furnished by Seller. (Emphasis added.)

Although Midland-Ross has not shown that it ever furnished American Can with any safety manuals or instruction sheets, it contends summary judgment is appropriate because at the time of the accident plaintiff was violating two safety procedures set forth in American Can's own safety manual.

The Court finds this contention meritless. The safety manual provision relates solely to manuals or instruction sheets furnished by Midland-Ross. Therefore, that plaintiff may have been violating safety provisions set forth in American Can's corporate manuals is irrelevant to the issue of indemnification.

C. The Notice Provision

The provision of the indemnification agreement pertaining to notice of accident states:

Buyer shall notify Seller promptly, and in any event within 30 days, of any accident or malfunction involving Seller's products which result in personal injury or damage to property and shall cooperate fully with Seller in investigating and determining the cause of such accident or malfunction. In the event that Buyer fails to give such notice to Seller and so cooperate, Buyer agrees to indemnify and save Seller harmless from any claims arising from such accident or malfunction.

In its brief in opposition to Midland-Ross' motion for summary judgment, American Can acknowledges it never officially notified Midland-Ross of plaintiff's accident in writing. Notwithstanding this failure to comply with the indemnification agreement requirement, American Can contends the motion of summary judgment should be denied because it was unaware of the notice provision until 1980. According to American Can, it has a policy of destroying all records after a period of seven years. Consequently, the 1968 proposal containing the notice provision was destroyed long ago. American further asserts that it was only because a bookkeeper at the Milwaukee American Can Company Plant kept some records for herself that the original documents were located and produced in 1980.

Whether American Can destroyed its documents or not is irrelevant to the enforceability of the notice requirement. American Can agreed to notify Midland-Ross of any accident involving the oven within thirty (30) days of the accident, and its failure to do so cannot be excused by its own recordkeeping practices.

American Can also contends it was not necessary for it to comply with the notice provision because Midland-Ross was sued at the same time American Can was...