Smoke v. Turner Const. Co.

• Decision Date: 25 February 1944
• Docket Number: Civil Action No. 232.
• Parties: SMOKE v. TURNER CONST. CO. (C. O. STRUSE & SONS, Third-Party Defendant).
• Court: U.S. District Court — District of Delaware

54 F. Supp. 369

SMOKE v. TURNER CONST. CO. (C. O. STRUSE & SONS, Third-Party Defendant).

Civil Action No. 232.

District Court, D. Delaware.

February 25, 1944.

William Prickett, of Wilmington, Del., for Turner Const. Co., third-party plaintiff.

H. Albert Young, of Wilmington, Del., for C. O. Struse & Sons, third-party defendant.

LEAHY, District Judge.

This action was begun in the Superior Court of Delaware and removed by defendant Turner Construction Company, a New York corporation. Smoke's original declaration against Turner sought to recover damages in the amount of $8720 for personal injuries. After removal, Turner filed a third party complaint¹ against C. O. Struse and Sons, a Pennsylvania corporation, who appeared and moved to strike paragraph 10(a) of the third party complaint and for summary judgment against Turner on the ground that the third party complaint did not state a cause of action. Both these motions raise the same question and will be considered together.

The admitted facts taken from the pleadings disclose the following material circumstances. Turner was the general contractor for the construction of the new Delaware Hospital in Wilmington. Struse was subcontractor for brick, terra cotta and other masonry work under an agreement between Turner and Struse dated August 17, 1939, the pertinent portion of which for the purposes of this case is set forth in the margin.² Smoke was a mortar mixer employed by Struse. While Smoke was working on the first floor, as a result of Turner's negligence, some hard object fell on him from one of the floors above. Smoke suffered personal injuries for which Struse paid him upwards of $1600 under the Delaware Workmen's Compensation Act. Rev. Code 1935, § 6071 et seq.

After Struse completed its work at the hospital, it gave Turner "A Release and Indemnity Agreement" dated April 16, 1941. It recited that Struse as subcontractor had received all sums due it for work, labor and materials furnished on the project. Another portion of the writing provided: "The Subcontractor Struse further agrees to indemnify and hold harmless the Turner Construction Company and Delaware Hospital, or either of them, for loss, expense, damage or injury as a result of claims arising out of or in connection with the execution of the work provided for in said contract, including any claim made by any laborer, contractor or material man that may have furnished labor or material directly or indirectly to the Subcontractor or by reason of any action brought or judgment recovered by such laborer, contractor or material man."

Struse brings this action as subrogee and in the name of Smoke under the applicable provision of the Delaware Workmen's Compensation Act.³ The complaint charges numerous acts of negligence on Turner's part.

Assuming Turner's negligence was the cause of Smoke's injuries, is Turner entitled to look to Struse to indemnify it in view of Struse's undertakings in the agreements of August 17, 1939, and April 16, 1941? The answer to this question depends on what construction is given the two agreements between the parties. These agreements will be discussed in their inverse chronological order.

1. Indemnity Agreement of April 16, 1941. This agreement is not relevant to the solution of the present problem for it is apparent from the language used that the parties did not intend to contract with respect to personal injuries to Struse's employees caused by Turner's negligence. The dominant purpose of the agreement is to indemnify "for loss * * * as a result of claims arising out of or in connection with the execution of the work provided for in said contract, including any claim made by any laborer, contractor or material man that may have furnished labor or material directly or indirectly to the Subcontractor or by reason of any action brought or judgment recovered by such laborer, contractor or material man." This is a special indemnity with respect to loss occasioned by faulty or defective workmanship, material or labor claims. It is something in addition to the safeguards provided for in the original contract and has nothing to do with personal injuries caused by Turner's negligence. There are several operative facts which support this conclusion. First, the particular agreement is dated subsequent to the completion of the work by Struse and, what is more significant, subsequent to the commencement of the suit by Smoke against Turner for personal injuries. Obviously, the parties would not have rationally intended to contract with reference to the subject matter embraced within that litigation without making some mention of it, because at the time of the execution of the agreement, the claim for substantial damages in the amount of $8720 had, of course, been made against Turner by the filing of Smoke's suit in the Superior Court in Delaware. Second, under the contract of August 17, 1939, two alternative safeguards were always available to Turner. It could have either withheld from its payments to Struse an amount which it thought sufficient to protect it from Smoke's claim of $8720 or it could have required Struse to furnish a surety bond to answer for any judgment Smoke might obtain in his personal injury action. Since Turner required neither safeguard, it is most unlikely that the parties would have intended the present matter to be governed by the much weaker indemnity contained in the April 16, 1941 agreement. The present problem must be determined without regard to this agreement.

2. Agreement of August 17, 1939. The problem of liability involved is one of substance. Delaware law applies. Before construing the agreement, the validity of indemnity agreements against the results of one's own negligence must be considered. Delaware holds such agreements valid. Marshall v. Maryland D. & V. Railway Co., 1 W.W.Harr. 170, 112 A. 526. This is also the general rule. National Transit Co. v. Davis, 3 Cir., 6 F.2d 729, certiorari denied 269 U.S. 579, 46 S.Ct. 104, 70 L.Ed. 422; Santa Fé Railway Co. v. Grant Bros. Const. Co., 228 U.S. 177, 33 S.Ct. 474, 57 L.Ed. 787. The remaining question in the case at bar then is whether the intention to indemnify from the results of the indemnitee's own negligence appears from a fair construction of the agreement sub judice.

The Delaware law does not require that indemnity from one's own negligence be expressed in so many words, but it is sufficient if such intention appear from a fair construction of the instrument. Marshall v. Maryland D. & V. Railway Co., supra. There is, however, no Delaware authority which determines whether the specific language of this agreement is sufficiently broad to cover the injury to Smoke. But, I think Delaware would, under such circumstances, examine the general authority on this point and accept that authority as the law of Delaware. Geller v. Transamerica Corp., D.C.Del., 53 F.Supp. 625; Stentor Electric Mfg. Co. v. Klaxon Co., 3 Cir., 125 F.2d 820; Moyer v. Van-Dye-Way Corporation, 3 Cir., 126 F.2d 339.

The language used in this...