Velsicol Chemical Corp. v. Rowe

• Citation: 543 S.W.2d 337
• Parties: VELSICOL CHEMICAL CORP. et al., Appellants, v. Mr. and Mrs. Leonard ROWE et al., Appellees, v. CHATTANOOGA COKE & CHEMICALS CO. et al., Appellees. 543 S.W.2d 337
• Decision Date: 25 October 1976
• Court: Tennessee Supreme Court

Page 337

543 S.W.2d 337

VELSICOL CHEMICAL CORP. et al., Appellants, v. Mr. and Mrs. Leonard ROWE et al., Appellees, v. CHATTANOOGA COKE & CHEMICALS CO. et al., Appellees.

543 S.W.2d 337

Supreme Court of Tennessee.

Oct. 25, 1976.

James W. Gentry, Jr., Gentry & Boehm, Chattanooga, for appellants.

Phillip A. Fleissner, W. K. Snouffer, Jr., Chambliss, Bahner, Crutchfield, Gaston & Irvine, Chattanooga, for appellees Rowe and others.

Spears, Moore, Rebman & Williams, Humphreys, Hutcheson & Moseley, Morgan, Garner & Wood, Chattanooga, for appellees Chattanooga Coke & Chemicals Co. and others.

OPINION

BROCK, Justice.

I.

The original plaintiffs, residents and homeowners of the Alton Park area of Chattanooga, sued Velsicol Chemical Corporation for damages allegedly caused them by pollutants emitted by Velsicol from its chemical manufacturing plant in Alton Park. It is alleged in the complaint that Velsicol's emissions contaminated the air and water in the Alton Park area and constituted a nuisance, and also that Velsicol had been guilty of trespass in depositing identifiable quantities of chemicals and other pollutants upon plaintiffs' properties. Plaintiffs also alleged that Velsicol had been guilty of intentional disregard of the law and of court injunctions in continuing the alleged nuisance, thus entitling plaintiffs to awards for punitive damages.

After filing an answer generally denying the plaintiffs' allegations, Velsicol filed a third-party complaint against five third-party defendants, alleging that each of them operated a plant in the Alton Park area, that during the period alleged in the original complaint each of them emitted pollutants of the air and water, and that by reason of these facts the third-party defendants are liable to Velsicol for 'whatever amount of recovery is made by said plaintiffs.'

The five third-party defendants filed motions to dismiss the third-party complaint which were sustained by the trial court upon the grounds that the third-party complaint (1) failed to state a claim against the third-party defendants upon which relief could be granted because the third-party plaintiff and third-party defendants were not 'joint tortfeasors' and, thus, the third-party plaintiff was not entitled to contribution or indemnity from third-party defendants and (2) the third-party complaint was not permissible under Rule 14.01 of the Tennessee Rules of Civil Procedure. Velsicol, the third-party plaintiff, appeals from the order of dismissal.

II

Rule 14.01 of the Tennessee Rules of Civil Procedure provides, in relevant part, as follows:

'At any time after commencement of the action a defending party, as a third-party plaintiff, may cause a summons and complaint to be served upon a person not a party to the action who is or may be liable to him for all or part of the plaintiff's claim against him.'

The Committee Comment to Rule 14 observes that:

'Rule 14 allows a defendant to bring in, as a third-party defendant, any new party who is or may be liable to defendant for all or part of the plaintiff's claim against the defendant . . . thus mak(ing) it possible for ultimate liability to be determined in a single suit where there are several parties whose rights and liabilities are interconnected.'

The language of Rule 14 is identical to the federal impleader rule. See Rule 14, Federal Rules of Civil Procedure. Federal decisions construing this language clearly hold that if there is a substantive right to indemnity or contribution among joint tortfeasors under applicable state law, the procedure for its enforcement is provided by Rule 14. 3 Moore's Federal Practice, par. 14.11, at 14--319 (3d ed. 174). See, e.g., Rouley v. State Farm Mut. Auto. Ins. Co., 235 F.Supp. 786 (W.D.La.1964); Bosin v. Minneapolis, St. Paul & Sault Ste. Marie R. Co., 183 F.Supp. 820 (E.D.Wis.1960), Aff'd 297 F.2d 583 (7th Cir. 1961).

We hold that Rule 14.01, Tennessee Rules of Civil Procedure, does authorize a third-party complaint based upon a claim of one tortfeasor for indemnity or contribution from other alleged 'joint tortfeasors.'

III

The third-party complaint, if liberally construed, may be considered to allege a claim based upon theories of indemnity or contribution. Although these terms are offen used interchangeably in many court decisions, there is, of course, a distinct and substantial difference between them. Contribution distributes the loss among the tortfeasors by requiring each to pay his proportionate share. Indemnity shifts the entire burden from one tortfeasor, who has been compelled to pay it, to the shoulders of another who should ultimately bear the loss instead.

Indemnity generally arises from an express or implied contract. The right to indemnity may, however, arise in the absence of an agreement and by operation of law to prevent an unjust result. This may be due to the relation of the parties to one another and the consequent duty owed, e.g., master and servant, or it may be because of a significant difference in the kind or quality of their conduct, e.g., 'active negligence' and 'passive negligence' or mere failure to remedy or discover the negligence. It is our opinion that the third-party plaintiff has not alleged facts sufficient to give rise to a possible right of indemnity against the third-party defendants.

IV

Does the third-party complaint allege a right to contribution from the third-party defendants? Essentially, it alleges that they, too, polluted the air and water, thus contributing to the damages, if any, suffered by plaintiffs.

The common law rule was that there could be no contribution between those who were regarded as 'joint tortfeasors,' when one had discharged the claim of the injured plaintiff. Rhea v. White, 40 Tenn. 121 (1859); Cohen v. Noel, 165 Tenn. 600, 56 S.W.2d 744 (1933); Prosser, Supra, § 50 and n. 38. The rule was originally adopted by the English courts in Merryweather v. Nixon, 101 Eng.Rep. (K.B.1799). Apparently, the basis of the rule was the unwillingness of the court to allow anyone to found a cause of action upon his own Deliberate wrong, an aspect of the 'unclean hands' doctrine. When, in the United States, the codes of civil procedure permitted joinder of defendants who were merely negligent, such defendants came to be called 'joint tortfeasors,' and the reason for the rule against contribution was lost to sight. The great majority of American jurisdictions applied the rule of no-contribution to all situations, even those in which independent, but concurrent, acts of negligence had contributed to a single resulting injury. A small minority of states--including Tennessee--eventually came to a contrary conclusion, allowing contribution among joint tortfeasors without the aid of legislation. Davis v. Broad St. Garage, 191 Tenn. 320, 232 S.W.2d 355 (1950); Huggins v. Graves, 210 F.Supp. 98 (E.D.Tenn.1962), Aff'd, 337 F.2d 486 (6th Cir. 1964); Prosser, Supra, § 50; Restatement (Second) of Torts, Explanatory Notes § 886A, comment A at 195 (Tent. Draft No. 16, 1970).

The earliest Tennessee case on the question of contribution between joint tortfeasors is Rhea v. White, supra, wherein the Court denied contribution, indicating that if the plaintiff had not been an Intentional tortfeasor he might have recovered. The same year, however, Anderson v. Saylors, 40 Tenn. 551 (1859), seemingly laid down a general rule against either contribution or indemnity among all joint tortfeasors.

Ever since the original rule was introduced, however, attempts have been made to carve out exceptions to it or to otherwise limit its prohibition. The first real breach of the strict rule in Tennessee occurred in Central Bank and Trust Co. v. Cohn, 150 Tenn. 375, 264 S.W. 641 (1924), involving the unintentional conversion of a note; the plaintiff seeking contribution from his fellow converters. This case clearly rejected the rule of no contribution among joint tortfeasors. Later cases further rejected the no-contribution rule. As noted by the late Chief Justice Burnett in Davis v. Broad St. Garage, supra, 232 S.W.2d at 357:

'Our cases make a clear distinction between wilful and intended wrongs in which the general rule of noncontribution is recognized and wrongs resulting from purely negligent acts, mistakes or other unintentional breaches of the law in which contribution is allowed.'

In Huggins v. Graves, supra, the federal district judge concluded that '. . . the right of contribution exists under Tennessee law as between joint tortfeasors in a negligence action in the absence of willful or wanton negligence upon the part of the party seeking contribution. Moreover, this result accords with reason and, as stated by the Tennessee Supreme Court in the Davis case, Supra, 'justice, right, and equity demand this conclusion." 210 F.Supp. at 103.

Any remaining uncertainty regarding the extent of the right of contribution among joint tortfeasors in Tennessee was dispelled by the 1968 enactment of the Tennessee Uniform Contribution Among Tortfeasors Act. ¹ T.C.A. §§ 23--3101-- 23--3105 (Supp. 1975). Excluding intentional tortfeasors, the Tennessee Uniform Act provides that the right to contribution arises upon the satisfaction of two general conditions. First, there must be 'two (2) or more persons . . . jointly or severally liable in tort for the same injury to person or property . . ..' T.C.A. § 23--3102(a). Secondly, one of those jointly or severally liable must have paid more than his pro rata share of the common liability. T.C.A. § 23--3102(b).

Obviously, the meaning of the phrase 'jointly or severally liable' is of primary importance in determining the right of contribution under our law.

An early Tennessee case, Swain v. Tennessee Copper Co., 111 Tenn. 430, 78 S.W. 93 (1903), stated that the test of joint liability is 'whether each of the parties is liabile for the entire injury done.' It would appear that the Court was begging the question:

'If they (the defendants) are...