Sorenson v. Safety Flate, Inc.

• Citation: 216 N.W.2d 859,298 Minn. 353
• Decision Date: 22 February 1974
• Docket Number: Nos. 43938,43982,s. 43938
• Parties: Stanley L. SORENSON, Plaintiff, Hartford Accident & Indemnity Co., intervenor, Plaintiff, v. SAFETY FLATE, INC., Respondent, Standard Metal Products Company, Appellant, Jack P. Hennessy Company, et al., Respondents, Standard Oil, a Division of American Oil Company, Respondent.
• Court: Supreme Court of Minnesota (US)

Page 859

216 N.W.2d 859

298 Minn. 353

Stanley L. SORENSON, Plaintiff Hartford Accident & Indemnity Co., intervenor, Plaintiff, v. SAFETY FLATE, INC., Respondent Standard Metal Products Company, Appellant Jack P. Hennessy Company, et al., Respondents Standard Oil, a Division of American Oil Company, Respondent.

Nos. 43938, 43982.

Supreme Court of Minnesota.

Feb. 22, 1974.

Syllabus by the Court

A party may be granted indemnity if his misconduct is clearly secondary when compared with the misconduct of the party from whom indemnity is sought. The determination should be based upon an examination of the difference in the character or kind of wrongs which caused the injury and in the nature of the legal obligation owed by each wrongdoer to the injured person.

Richards, Montgomery, Cobb & Bassford, and Jon D. Jensvold and Jerome C. Briggs, Minneapolis, for appellant.

Sturtz, Peterson, Butler & Chesterman, Albert Lea, for Safety Flate, Inc.

John E. Castor and Robert T. Stich, Minneapolis, for Hennessy Co., and others.

Alderson Catherwood Ondov & Leonard and Gary E. Leonard, Austin, for Standard Oil.

Heard before KNUTSON, C.J., and OTIS, PETERSON, MacLAUGHLIN, and YETKA, JJ., and considered and decided by the court.

MacLAUGHLIN, Justice.

The issue in this case is the right of indemnification among the defendants. The trial court entered orders concerning indemnity which we now affirm.

Plaintiff Stanley L. Sorenson was injured while employed at Jay's Truck Stop in Albert Lea, where part of his duties consisted of changing truck tires. There is a great potential danger of injury involved in changing truck tires because certain rim assemblies have a propensity, if in a damaged condition or if improperly seated, to fly off with great force upon inflation of the tire. At the time of the injury plaintiff was engaged in changing a truck tire with the aid of a safety device known as the 'Safety Flater,' which his employer had purchased specifically to prevent such accidents from occurring. The Safety Flater was designed to fit over the rim of the tire and prevent the disengagement of the rim during the tire's inflation. Unfortunately, it did not perform as intended, and plaintiff was injured when a part of the tire rim flew off and struck him.

The Safety Flater was designed by one John Merriman who entered into a license agreement with defendant Safety Flate, Inc., a corporation formed for the purpose of marketing the device. An officer of Safety Flate contacted defendant Standard Metal Products Company, a corporation engaged in metal fabricating, to inquire if Standard Metal could fabricate the device for Safety Flate. Standard Metal agreed to fabricate the device and a prototype of the Safety Flater was submitted to Standard Metal. Standard Metal was instructed to duplicate the prototype exactly. Prior to beginning actual production, Standard Metal submitted two sample Safety Flaters to Safety Flate for approval, and the two samples were approved by Safety Flate. Neither Safety Flate nor Standard Metal ever tested the device or caused it to be tested. Completed Safety Flaters were stamped 'Safety Flate, Inc.' by Standard Metal, placed in cardboard cartons, and shipped to Safety Flate.

Safety Flate made arrangements for the distribution and sale of the Safety Flater with Jack P. Hennessy Company, a corporation which later merged with Three Star Sales Corporation of Illinois. For the purposes of this decision, these corporations may be considered as one defendant (Hennessy-Three Star).

Hennessy-Three Star would submit orders from customers to Safety Flate with instructions to ship the Safety Flater directly to the customer. Safety Flate would then ship the device to the customer but would bill Hennessy-Three Star.

One of the purchasers of Safety Flaters from Hennessy-Three Star was defendant Standard Oil, a division of American Oil Company. Standard Oil in turn sold the device directly to users. In making its sales presentation to Standard Oil, Hennessy-Three Star used a descriptive printed 'flyer' which they had prepared, illustrating and describing the Safety Flater. The flyer contained the following language:

'Whether you change one or fifty tires a day the danger of exploding lock rings always exists. Everyone knows the damage or serious injury that may occur. It only has to happen once. THE THREE STAR SAFETY FLATER will protect your man and enable you to meet insurance underwriters specifications for safety.'

The flyer also depicted alternative ways of protecting oneself while changing a truck tire, but suggested that the Safety Flater was the preferable method. No test of the Safety Flater was ever made by either Hennessy-Three Star or Standard Oil.

Plaintiff's employer, who had purchased the Safety Flater for use in his service station, testified that he had seen and relied upon the flyer prior to his purchase of the Safety Flater from Standard Oil. He said he did not know where the flyer came from, but assumed that it had been provided by Standard Oil.

At the end of the trial, the court ruled as a matter of law that both Safety Flate and Standard Metal were manufacturers of the Safety Flater and that Hennessy-Three Star and Standard Oil were distributors. No appeal has been taken from that ruling. The jury by a special verdict found no negligence on the part of plaintiff, but found all defendants liable to plaintiff on the theory of strict liability in tort. In addition, defendants Standard Metal and Safety Flate were found to be negligent, and defendants Hennessy-Three Star and Standard Oil were found to have made and breached an express warranty. Further, the jury, in response to a specific question submitted to them, ascribed percentages of wrongful conduct to each of the parties. No question has been raised in this court regarding the questions submitted to the jury or the findings of the jury.

Subsequent to trial, and after hearing arguments on defendants' cross-claims for indemnity, the trial court entered an order for judgment (a) denying claims for indemnity asserted by defendants Standard Metal and Safety Flate against all other defendants, including each other; (b) granting claims for indemnity of defendants Hennessy-Three Star and Standard Oil against defendants Standard Metal and Safety Flate; (c) granting a claim for indemnity of Standard Oil against Hennessy-Three Star and denying a claim for indemnity of Hennessy-Three Star against Standard Oil; and (d) reserving for future consideration the cross-claims of each defendant against the others for contribution. ¹

1. The principal issue is the propriety of the order granting indemnity to Hennessy-Three Star and Standard Oil from Standard Metal and Safety Flate. The factors to be considered in determining the right to indemnity have been discussed by this court on many occasions. Haney v. International Harvester Co., 294 Minn. 375, 201 N.W.2d 140 (1972); Kenyon v. F. M. C. Corp., 286 Minn. 283, 176 N.W.2d 69 (1970); Larsen v. Minneapolis Gas Co. 282 Minn. 135, 163 N.W.2d 755 (1968); Thill v. Modern Erecting Co., 272 Minn. 217, 136 N.W.2d 677 (1965); Daly v. Bergstedt, 267 Minn. 244, 126 N.W.2d 242 (1964); Hendrickson v. Minnesota Power & Light Co., 258 Minn. 368, 104 , n.W.2d 843 (1960); Lunderberg v. Bierman, 241 Minn. 349, 63 N.W.2d 355, 43 A.L.R.2d 865 (1954). Historically, indemnity was said to rest upon contract only, either express or implied. However, in Hendrickson v. Minnesota Power & Light Co. Supra, we found the contract theory to be too narrow in scope and adopted the more modern view that 'principles of equity furnish a more satisfactory basis for indemnity.' 258 Minn. 371, 104 N.W.2d 847. While cautioning that the circumstances under which indemnity is allowed are exceptional and limited, the court in Hendrickson proceeded to set forth certain situations in which indemnity may generally be granted (258 Minn. at 372, 104 N.W.2d 848):

'(1) Where the one seeking indemnity has only a derivative or vicarious liability for damage caused by the one sought to be charged.

'(2) Where the one seeking indemnity has incurred liability by action at the direction, in the interest of, and in reliance upon the one sought to be charged.

'(3) Where the one seeking indemnity has incurred liability because of a breach of duty owned to him by the one sought to be charged.

'(4) Where the one seeking indemnity has incurred liability merely because of failure, even though negligent, to discover or prevent the misconduct of the one sought to be charged.

'(5) Where there is an express contract between the parties containing an explicit undertaking to reimburse for liability of the character involved.'

We have also at times discussed a standard for granting indemnity which turns on a determination of whether the proposed indemnitee has engaged in active or passive misconduct in causing the damage to the plaintiff. However, under some circumstances a more useful approach is to determine...