Slater v. Central Plumbing and Heating Co.

• Decision Date: 21 March 1996
• Docket Number: No. 95-369,95-369
• Citation: 912 P.2d 780,275 Mont. 266
• Parties: Billy A. SLATER, Plaintiff and Respondent, v. CENTRAL PLUMBING AND HEATING COMPANY, Defendant and Appellant, and Edsall Construction Company, Inc., (American States Insurance Company, Subrogee), Defendant and Respondent.
• Court: Montana Supreme Court

Page 780

912 P.2d 780

275 Mont. 266

Billy A. SLATER, Plaintiff and Respondent, v. CENTRAL PLUMBING AND HEATING COMPANY, Defendant and Appellant and Edsall Construction Company, Inc., (American States Insurance Company, Subrogee), Defendant and Respondent.

No. 95-369.

Supreme Court of Montana.

Submitted on Briefs Jan. 18, 1996.

Decided Feb. 22, 1996.

Rehearing Denied March 21, 1996.

Appeal from the District Court of the Eighth Judicial District, Cascade County; Marc G. Buyske, Judge.

George D. Goodrich, Garlington, Lohn & Robinson, Missoula, for appellant.

James R. Walsh, Smith, Walsh, Clarke & Gregoire, Great Falls, for respondent.

LEAPHART, Justice.

Central Plumbing & Heating Company (Central) appeals from the March 17, 1995, order of the Eighth Judicial District Court, Cascade County, granting American States Insurance Company's (American) summary judgment on a cross-claim, brought in the name of Edsall Construction Company (Edsall), concluding that Central had breached its contract with Edsall. We reverse.

We consider the following issues on appeal:

1. Did the District Court err in granting summary judgment to Edsall concluding that Central breached the subcontract agreement?

2. Did the District Court err in awarding prejudgment interest and attorney's fees to Edsall?

Edsall was the general contractor on a project to build a commissary building, over 30 feet high, on Malmstrom Air Force Base, located near Great Falls, Montana. Edsall contracted with Central, a subcontractor, to perform work on the project. In turn, Central sub-subcontracted with other construction companies, including Building Sprinkler Company. On March 10, 1988, Billy Slater (Slater), an employee of Building Sprinkler, was injured when a wheel on the motorized scaffolding he was using to install a fire control system fell into a floor drain grate causing the scaffolding to tip and Slater to fall. Defendant Central had installed the floor drains.

Slater filed suit against Edsall and Central for his injuries. Slater moved for partial summary judgment as to liability against Edsall. The District Court found that "the party originally responsible for job safety has a non-delegable duty to employees of subcontractors." The District Court determined that, by virtue of its prime contract with the United States Government, Edsall had a nondelegable duty to provide for the safety of workers and ensure the compliance of subcontractors. The District Court ruled that Edsall, in failing to properly cover or protect the floor openings, had violated its own contractual duties as well as the Montana Scaffolding Act, §§ 50-77-101 to 50-77-107, MCA, (the Act). Further, the District Court recognized that as the party in control of the work, Edsall was absolutely liable for any violation of the Act. Thus, the District Court granted the motion for partial summary judgment against Edsall on the issue of liability.

In addition, Slater moved for partial summary judgment against Central; the court, however, denied that motion. Before trial, Slater settled with Central. The District Court directed a verdict for Slater against Edsall on the questions of duty, breach and causation, thus, the jury determined only the amount of damages. The jury awarded Slater $675,000. No appeal was taken from this verdict. American, Edsall's insurer, paid the judgment.

Subsequently, American, in Edsall's name, filed an amended cross-claim against Central claiming indemnification due to Central's breach of the subcontract agreement between Central and Edsall. American's complaint alleged that:

The contract between Edsall and Central, and in particular the first paragraph thereof, was breached by Central.... These breaches caused the judgment against Edsall and payment by Edsall to Billy Slater described herein, and for that reason, Edsall is entitled to be fully indemnified by Central Plumbing and Heating for its loss.

....

Alternatively, and in addition to the foregoing, the contract between Edsall and Central provides at paragraph 9 that Central will protect and indemnify Edsall against any loss or damage suffered by anyone arising through the negligence of Central, or those employed by it, or its agents or servants. Under this provision, Central is liable to Edsall for all damages caused by its negligence, the negligence of its sub-sub-contractor, or of Billy Slater himself.

Both Central and American moved for summary judgment. Central claimed that "Edsall, by virtue of its prime contract with the United States Government, had a non-delegable duty to provide for the safety of workers and ensure the compliance of subcontractors." Further, because Central was not the party in control of the workplace, it was not liable as a matter of law. American argued that Central had breached the subcontract agreement by not complying with the Act and the Occupational Safety and Health Act (OSHA). On April 18, 1992, the District Court granted summary judgment in favor of American on the breach of contract claim leaving the question of damages for a later determination. On March 17, 1995, the District Court awarded judgment against Central in the amount of $630,044.31 (the amount that American had paid Slater), together with interest accruing at the rate of 10% per annum from June 3, 1991. The District Court, pursuant to a clause in the subcontract agreement, also awarded American attorney's fees and costs incurred in the defense of Slater's claim against Edsall and in the prosecution of the cross-claim against Central. Central appeals from this determination.

1. Did the District Court err in granting summary judgment to Edsall concluding that Central breached the subcontract agreement?

Our standard in reviewing a district court's grant of a motion for summary judgment is the same as that used by the district court; we are guided by Rule 56(c), M.R.Civ.P. Chilberg v. Rose (Mont.1995), 903 P.2d 1377, 1378-79, 52 St.Rep. 1038, 1039 (citing Minnie v. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214). Thus, we determine whether a genuine issue of material fact exists and whether the moving party is entitled to judgment as a matter of law. Chilberg, 903 P.2d at 1378-79. In this case, the underlying facts are not in dispute, therefore, we consider whether the District Court was correct in concluding that American was entitled to damages for breach of the subcontract agreement as a matter of law.

A violation of the duties imposed by the Montana Scaffolding Act imposes absolute liability. Mydlarz v. Palmer/Duncan Constr. Co. (1984), 209 Mont. 325, 336, 682 P.2d 695, 701. Once the District Court determined that Edsall was liable for Slater's injuries because of its violations of the Act, American should not have the opportunity to pin that liability on the subcontractor. Edsall did not appeal from the judgment finding that it was liable for violations of the Act. It is, therefore, inconsistent for American to claim that Central breached the subcontract and assert that the damages it paid on behalf of Edsall, the party found to be responsible, were due to Central's violation of OSHA rather than Edsall's violations of the Act. The District Court's instructions to...