Smith v. Seaboard Coast Line R. Co.
Decision Date | 16 March 1981 |
Docket Number | No. 80-7074,80-7074 |
Citation | 639 F.2d 1235 |
Parties | M. D. SMITH d/b/a M. D. Smith Construction Company, Plaintiff-Appellant, v. SEABOARD COAST LINE RAILROAD COMPANY, Defendant-Appellee. . Unit B |
Court | U.S. Court of Appeals — Fifth Circuit |
Montet & Smith, Malcolm P. Smith, Atlanta, Ga., for plaintiff-appellant.
Eugene A. Epting, Athens, Ga., for defendant-appellee.
Appeal from the United States District Court for the Northern District of Georgia.
Before KRAVITCH and THOMAS A. CLARK, Circuit Judges and LYNNE *, District Judge.
The judgment appealed from is AFFIRMED on the basis of the Order of District Judge William C. O'Kelley, filed on December 17, 1979, and attached hereto as an Appendix.
AFFIRMED.
APPENDIX
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
GAINESVILLE DIVISION
M.D. SMITH d/b/a M.D. :
SMITH CONSTRUCTION COMPANY :
:
O'KELLEY, District Judge.
The plaintiff M. D. Smith commenced this action in the Superior Court for Barrow County, Georgia, alleging that a shop building and some equipment were destroyed by a fire started through the negligence of the defendant Seaboard Coast Line Railroad Co. The defendant answered and counterclaimed for the costs of defending this suit pursuant to the indemnity provision of their lease agreement. The defendant, a Virginia corporation, then had the suit removed to this court. Presently pending before the court is the defendant's motion for summary judgment.
The following facts are undisputed. On March 24, 1978, a fire began on the defendant's right-of-way at a point adjacent to the plaintiff's property. The fire spread to a small shed containing combustible petroleum products used by the plaintiff in his business. The property on which the shed was located belonged to the defendant and had been leased by the plaintiff for $100.00 per year since early 1969. 1 From the shed the fire then spread to and destroyed an adjoining metal shop building located entirely on the plaintiff's property. The plaintiff now seeks $36,394.75 for the loss of the metal shop building.
The defendant's argument in support of its motion is simple and straightforward: the plaintiff agreed in paragraphs six and eight of the lease agreement, respectively, to
indemnify and save harmless Lessor, its successors and assigns, against any and all claims, demands, suits, judgements (sic) and sums of money ... for the loss of or damage to said structures, their contents, fence or any property placed upon or stored in said premises, as the result of fire, regardless of Lessor's negligence ...;
and to
indemnify and save harmless Lessor, its successors and assigns, from and against all loss, costs, expense, claims, suits and judgments, including attorneys' fees, whatsoever in connection with ... loss of or damage to property caused by or in any way connected with Lessee's use of the leased premises, whether such injury, death, loss, or damage results from any cause whatsoever; and whether such injury, death, loss or damage results from the negligence of Lessor, its agents or otherwise.
On the basis of the foregoing provisions the defendant contends that even assuming that the fire started as a result of its negligence, the plaintiff has contracted away his right to sue the defendant for the damage and that, therefore, there is no issue of fact. The only chore remaining for the court, the defendant concludes, is to decide the purely legal question whether these indemnity provisions can be construed to screen the defendant from any liability for this accident.
The plaintiff's counter-arguments, on the other hand, are multifold. He asserts that one of the indemnity provisions is contrary to the public policy expressed in Ga.Code Ann. § 20-504 and, therefore, is unenforceable; that the provisions cannot be construed to shield the defendant from liability for an accident caused solely by its own negligence, since they do not express the intent of the parties in clear and unequivocal terms; that even if the indemnity provisions are valid and enforceable, they absolve the defendant of liability only for damage to any of the plaintiff's property located on the defendant's right-of-way; and that even if the provisions are valid and enforceable, and apply to any damage whatsoever suffered by the plaintiff, the defendant is estopped from relying on them since its representative assured the plaintiff prior to the execution of the lease agreement that the shed was not on the defendant's right-of-way.
Aside from this final argument by the plaintiff, the parties disagree only as to the legal meaning of their agreement. In resolving this narrow issue the court's role is well-defined. If the language of the agreement is clear, then it is controlling, and the court need look no further. Carsello v. Touchton, 231 Ga. 878, 204 S.E.2d 589 (1974). This principle is the obverse of the broad freedom of contract the law grants the parties; once a contract is signed, its provisions define the full measure of rights accorded each party. Worth v. Orkin Exterminating Co., 142 Ga.App. 59, 60, 234 S.E.2d 802 (1977). Whether the language of an agreement is clear or ambiguous, then, is a question of law for the court. Freeman v. Continental Gin Co., 381 F.2d 459 (5th Cir. 1967); Honea v. Gilbert, 236 Ga. 218, 219, 223 S.E.2d 115 (1976); Early v. Kent, 215 Ga. 49, 49-50, 108 S.E.2d 708 (1959); Ga.Code Ann. § 20-701. Only if ambiguity remains after the court applies the pertinent rules of construction does this become a question of fact. General Wholesale Beer Co. v. Theodore Hamm Co., 567 F.2d 311, 313 (5th Cir. 1978) (per curiam); R. S. Helms, Inc. v. GST Development Co., 135 Ga.App. 845, 848, 219 S.E.2d 458 (1975). See generally 3 Corbin on Contracts, § 554, at 219-25.
Whether this disagreement can be resolved on a motion for summary judgment, then, depends upon the clarity of the language used by the parties to express their intentions. As a general rule a party may contract away liability to the other party for the consequences of his own negligence without contravening public policy, provided the parties' intention to this effect is expressed in clear and unequivocal terms, and except when such an agreement is prohibited by statute or where a public duty is owed. Batson-Cook Co. v. Georgia Marble Setting Co., 112 Ga.App. 226, 229-30, 144 S.E.2d 547 (1965). Applying this standard, Georgia courts have held in a number of cases that an exculpatory clause shielded a defendant from liability for the plaintiff's injury, even when his negligence caused or contributed to the accident. E. g., Southern Railway Co. v. Insurance Company of North America, 228 Ga. 23, 183 S.E.2d 912 (1971); Blitch v. Central of Georgia Railway Co., 122 Ga. 711, 50 S.E. 945 (1905); Binswanger Glass Co. v. Beers Construction Co., 141 Ga.App. 715, 234 S.E.2d 363 (1977); Georgia Ports Authority v. Central of Georgia Railway Co., 135 Ga.App. 859, 219 S.E.2d 467 (1975); Benson Paint Co. v. Williams Construction Co., 128 Ga.App. 47, 195 S.E.2d 671 (1973); Hearn v. Central of Georgia Railway Co., 22 Ga.App. 1, 95 S.E. 368 (1918). In each of these cases the courts determined that as a matter of law the indemnity provision in question was drafted in clear enough terms to protect the indemnitee even though he had been negligent. While no talismanic phrase is necessary, whether this indemnity clause accomplishes what the defendant insists it does, then, depends entirely upon the language used. See Brown v. Seaboard Coast Line Railroad Co., 554 F.2d 1299 (5th Cir.), cert. denied, 434 U.S. 975, 98 S.Ct. 533, 54 L.Ed.2d 467 (1977).
The plaintiff first contends that the exculpatory clauses set forth in paragraphs six and eight of the lease agreement protect the defendant only from liability for the damage to any of the plaintiff's property resting on the defendant's right-of-way. By this interpretation the provisions would cover damage to the small shed only, which loss the plaintiff concedes he must absorb. In support of this argument the plaintiff cites Manchester Marble Co. v. Rutland Railroad Co., 100 Vt. 232, 136 A. 394 (1927), in which the Vermont Supreme Court refused to construe an indemnity clause to protect the defendant from liability for any damage to the plaintiff's property that was not located on the defendant's right-of-way, even though the structures on and off the right-of-way constituted a single unit for the purposes of the plaintiff's business.
A similar argument made by the plaintiff, which can be discussed simultaneously with his first, is that the indemnity provisions could not bar the plaintiff's claim if the trier of fact was to determine that the defendant was alone responsible for this accident because the provisions do not state this intent in clear and unequivocal terms. The plaintiff insists that the paragraph six exculpatory clause pertains only to the shed on the defendant's right-of-way, while the reference in the paragraph eight exculpatory clause to the "lessee's use of the leased premises" declares as a necessary precondition to its operation that the plaintiff be contributorily negligent. Upon this foundation he contends that it is impossible to determine as a matter of law that he was in any way responsible for his loss; therefore, a question of fact remains for the jury's consideration.
The court agrees that this case presents a classic causation-in-fact problem, one which it would not endeavor to decide summarily, but the court need not wrestle with this quandary for the issues raised by the defendant's motion and the plaintiff's counter-arguments can be settled without a long-winded discussion of the bizarre circumstances of this accident.
The plaintiff erected a small shed and a chain-link fence as an extension of his business operation on what the plaintiff reasonably believed to be his own...
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