White v. Newark Morning Star Ledger

Decision Date01 November 1990
PartiesEugene WHITE, Plaintiff, v. NEWARK MORNING STAR LEDGER; John Doe (name being fictitious); and ABC Corp. (name being fictitious), Defendants. NEWARK MORNING STAR LEDGER, Defendant Third-Party Plaintiff, v. COLIN SERVICES SYSTEMS, INC., Third Party Defendant.
CourtNew Jersey Superior Court
Marjorie O. Smith, South Orange, for defendant, third-party plaintiff, Newark Morning Star Ledger. (Connell, Foley & Geiser, attorneys; Jeffrey Moryan, Roseland, on the brief)

Michael John Stone (Hoagland, Longo, Oropollo & Moran, attorneys; Michael John Stone, New Brunswick, on the brief), for third-party defendant Colin Service Systems.

KENNETH R. STEIN, J.S.C.

The issues presented by this ruling concern: (i) the right of a third-party tortfeasor to obtain indemnification from an employer pursuant to an express agreement between that tortfeasor and the employer, and (ii) the right of that tortfeasor to name the employer as a third-party defendant in an action brought by the injured employee.

Plaintiff, Eugene White, Jr., (White) was injured while working on the premises of defendant, third-party plaintiff, Newark Morning Star Ledger (Ledger) on or about September 5, 1987. White was then an employee of third-party defendant Colin Service Systems, Inc. (Colin). Colin had contracted to supply labor and services to Ledger pursuant to an agreement between Colin and Ledger dated October 1, 1985 (labor agreement) and White was on the Ledger's premises pursuant to that agreement. White received a worker's compensation award from Colin for his injuries this action White filed a complaint against Ledger charging that while he was on Ledger's premises, Ledger, through its agents, servant and/or employees, was so negligent as to allow a large roll of paper to fall and crush his hand. Ledger filed a third-party complaint against Colin claiming that if it (Ledger) is adjudged liable to White, it is entitled to a defense, indemnification and costs from Colin pursuant to the labor agreement. White did not bring a direct claim against Colin.

Ledger's claim for indemnification against Colin is based on the express terms of the labor agreement, and more particularly paragraph 10. The full text of that paragraph is annexed to this opinion as schedule "A."

Colin moved for summary judgment dismissing Ledger's third-party complaint and this is the ruling on that motion.

The Workers' Compensation Act (act), N.J.S.A. 34:15-1 et seq., provides the exclusive remedy against the employer for a work-related injury sustained by an employee. By accepting the benefits of the act, the employee forsakes a tort action against the employer. Ramos v. Browning Ferris Industries, 103 N.J. 177, 510 A.2d 1152 (1986).

In Port Auth. v. Honeywell Prot. Serv., 222 N.J.Super. 11, 535 A.2d 974 (App.Div.1987) the court in commenting upon the rights of a third-party tortfeasor against an employer stated:

A corollary to this fundamental policy is that because the employer is removed from tort liability, it is not subject to the provisions of the Joint Tortfeasors Contribution Law ( N.J.S.A. 2A:53A-1 et seq.). Thus a "third-party tortfeasor may not obtain contribution from an employer, no matter what may be the comparative negligence of the third party and the employer." Ramos v. Browning Ferris Industries, supra, 103 N.J. at 184 . The exclusive-remedy provision precludes a claim for contribution against an employer whose concurring negligence contributed to the injury of an employee. Id. at 185 . [citations omitted]

Although a third-party tortfeasor cannot seek contribution from an employer, it may obtain indemnification where that course is specifically permitted by way of an express contract. The Act does not preclude the employer's assumption of a contractual duty to indemnify a third party through an express agreement. Ramos v. Browning Ferris Industries, supra, 103 N.J. at 191 .

Strong public policy considerations along with the general rules governing the construction of contacts dictate that when the meaning of the indemnification clause is ambiguous, it should be strictly construed against the indemnitee. Ibid. Thus, "a contract will not be construed to indemnify the indemnitee against losses resulting from its own negligence unless such an intention is expressed in unequivocal terms." Ibid. [citations omitted] Subject to this principle, the parties to a contract can generally allocate the burden of risk as to any potential tort liability in any manner they may choose. [at 19-20, 535 A.2d 974]

It is clear that the act does not preclude a third-party tortfeasor from obtaining indemnification from an employer where such indemnification is permitted by an express written agreement between the parties.

In paragraph 10(a) of the labor agreement Colin clearly and unambiguously undertakes

'to indemnify and save Ledger harmless against all liability ... on account of any injury or death to any person (including employees of the parties hereto) ... in any way relating to the performance by Colin ... of [the] Agreement including, but not limited to, paper handling services ... except for such injury ... due to the affirmative negligent acts of Ledger....' [Emphasis supplied]

Injuries to Colin employees while engaged in paper handling services are expressly covered by the indemnification provisions of the labor agreement.

Colin argues that where an agreement purports to indemnify the indemnitee for its own negligence, courts closely scrutinize the agreement to ascertain whether the parties intended to shift liability, and that where the negligence of the indemnitee is the sole cause of the accident, recovery is denied against the indemnitor unless an intent to indemnify is unequivocally spelled out in a contract. See Stier v. Shop Rite of Manalapan, 201 N.J.Super. 142, 150, 492 A.2d 1055 (App.Div.1985). However, that argument is not applicable to this situation since the labor agreement does not purport to indemnify Ledger for its own affirmative negligence, nor does it purport to indemnify Ledger where its affirmative negligence is the sole cause of the accident. The labor agreement, itself, excepts from the indemnification, losses due to the affirmative negligent acts of Ledger. Further, where the injuries to the employee are due to the As stated earlier, in this action White seeks only relief against Ledger and makes no claim against Colin. That alone does not mean Colin is free from negligence, rather, it can be assumed that White has made no direct claim against Colin because he is precluded from doing so by the act.

affirmative negligent acts of Ledger, paragraph 10(e) provides that Ledger shall provide indemnification to Colin.

If, in this instance, both Ledger and Colin were negligent and proximately caused the accident, Ledger as the third-party tortfeasor will be solely responsible to White. Ramos v. Browning Ferris Industries, supra. Further, absent the indemnification, Ledger alone would bear the financial responsibility for such loss, and would have no recourse against Colin. It is precisely to avoid this result and to circumvent the bar of the act that Ledger sought and obtained the protection of paragraph 10 of the labor agreement. The effect of paragraph 10 is to require Ledger to bear the cost of any recovery resulting from its affirmative negligence, while providing it with indemnification from Colin against any losses not due to its (Ledger's) affirmative negligent acts. That is clearly the intent and purpose of paragraph 10 of the labor agreement.

There remains then the question of how best to allocate the liability as between Ledger, to the extent that liability results from Ledger's affirmative negligent acts, and Colin. The logical and most efficient means of achieving that result will be by proceeding as this case is presently structured, with both Ledger and Colin as parties. That will enable the same jury to fix the damages due from Ledger to White, while also fixing the amount due to Ledger pursuant to the indemnification provisions of the labor agreement.

Colin argues that the Comparative Negligence Act restricts the assessment of negligence to the parties to the suit ( N.J.S.A. 2A:15-5.2b) and that an employer is not a proper party to a suit brought by an employee against a third-party Second, the allocation of liability or responsibility as between Ledger and Colin is not an allocation to be made under the Comparative Negligence Act. The Comparative...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT