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The following is a recent decision by Judge Mize of the Superior Court of the District of Columbia, in Charles H. Tompkins Co., et al. v. Power Services, Inc., Case No. 98CA5803, in a case handled by David P. Durbin, Esq. of this firm. O R D E R Before the court are cross motions for summary judgment from plaintiffs and defendants along with oppositions thereto and defendants* reply in support of their motion for summary judgment. The facts described herein are undisputed. Thus, the court needs only to determine if the record before it entitles a movant, or movants, to judgment as a matter of law. See Super. Ct. Civ. R. 56(c); Williams v. Gerstenfeld, 514 A.2d 1172, 1176 (D.C. 1986). Plaintiffs Charles H. Tompkins Co.! Mid American Elevator Co. Joint Venture (" the Joint Venture") and its insurer Travelers Property & Casualty Company, ("Travelers") request the court to declare that two different contracts entitled the Joint Venture to: (1) a defense and indemnification for an earlier legal action brought against it; and (2) reimbursement for the settlement, costs and fees incurred with the earlier lawsuit. Travelers is a plaintiff because it paid the attorney*s fees, litigation costs, and settlement in the earlier legal action pursuant to an insurance policy between it and the Joint Venture and now seeks reimbursement. Plaintiffs base their claims against defendant Power Services, Inc. ("PSI") pursuant to its subcontract with the Joint Venture. Plaintiffs* claims against defendant Company ("Twin City") rest on an insurance policy issued by Twin City to PSI which names the Joint Venture as an additional insured. In September 1995, the Joint Venture entered into a subcontract with PSI whereby PSI was to perform electrical work as part of an elevator modernization project that the Joint Venture had undertaken. Among other things, the subcontract contained a clause whereby PSI would defend and indemnify the Joint Venture for any claims of bodily injury and for accompanying attorney*s fees. The clause states also that PSI*s duties "shall not arise if such injury . . . is caused by the sole negligence of [the Joint Venture]." The indemnity clause also contains a provision stating that "Subcontractor agrees to reimburse Contractor for all costs (including attorney*s fees) incurred by Contractor in enforcing or securing Subcontractor*s performance of any of the provisions of this Subcontract.... PSI held a liability insurance policy. Section 9 of an endorsement to that insurance policy amends the policy to include the Joint Venture as an additional insured under certain conditions. See, e.g., Pls.* Mot., Ex. 3, CG-00-O 1-10-93, at 4. On December 13, 1995, Thomas Crooks, an employee of PSI, was injured while riding on top of a moving elevator car and in the course of providing electrical services to the Joint Venture pursuant to the subcontract. See, e.g, Pls.* Mot., Stint. of Undisputed. Facts, at 2; see also Defs.* Mot., at 2. Subsequently, Mr. Crooks filed a lawsuit against the Joint Venture and the employee of the Joint Venture who was operating the elevator. Mr. Crooks asserted that the Joint Venture was liable for his injury based on theories of negligence and strict liability. The jury returned a verdict that the Joint Venture had failed to provide a safe workplace. On Mr. Crooks* claim for negligent failure to warn and instruct, the jury determined that the Joint Venture was negligent, that Mr. Crooks was not contributorily negligent, but that Mr. Crooks had assumed this risk imposed by this negligence. Neither PSI nor Twin City provided any defense or indemnification in the Crooks action. The Joint Venture received a defense in the Crooks action pursuant to its commercial general liability policy issued between it and an insurer whose successor is defendant Travelers. See PIs.* Mot., Stint. of Undisputed. Facts, at 2. Mr. Crooks was awarded a money judgment. His case was appealed. During the pendency of that appeal, the case was settled, and defendant Travelers paid the settlement amount to Mr. Crooks. These motions require the court to determine whether the Crooks action triggered either of the defendants* duties to defend or duty to indemnify and whether PSI must reimburse plaintiffs for their costs and attorney*s fees in the instant action. 1. Twin City*s Duties to Defend and Indemnify The heart of the debate among the parties with respect to these duties focuses on whether the Joint Venture was an additional insured for purposes of the Crooks action within the meaning of section 9 of an endorsement to the insurance policy ("section 9"). Defendants argue that Twin City did not have a duty to defend or indemnify the Joint Venture because section 9 limited the Joint Venture*s coverage to claims for vicarious liability stemming from the conduct of PSI. They go on to assert that this duty was not triggered because Mr. Crooks claimed that the negligence of the Joint Venture and the Joint Venture*s employee were the direct cause of his injury. Plaintiffs in their motion and opposition contend that section 9 is not so restrictive. They argue that section 9 made the Joint Venture an additional insured for claims "arising out" of PSI*s work or operations and not just for claims asserting that the Joint Venture was vicariously liable. Plaintiffs assert that the Joint Venture was entitled to a defense in the Crooks action because Mr. Crooks injuries were sustained while performing work on the subcontract and in the scope of his duties for PSI. The court does not find that section 9 restricted the Joint Venture*s coverage as an additional insured to claims that it was vicariously liable for PSl~s conduct. "In this jurisdiction. as elsewhere, it has long been ‘a general rule of construction of policies of insurance... that any reasonable doubt which may arise as to the meaning or intent of a condition thereof, will be resolved against the insurer."* Cameron ~ USAA Prop. & Gas. Ins. Co., 733 A.2d 965, 968-69 (D.C. 1999) (internal citations omitted). Section 9 states that the policy, with respect to who is an insured, "is amended to include as an insured any person or organization with whom you agreed, because of a written contract or agreement or permit, to provide insurance such as afforded under this policy, but only with respect to your operations, ‘your work* or facilities owned by you." See, e.g., Pis.* Mot., Ex. 3, CG-00-0l-l0-93, at 4. Thus, it does not expressly restrict the Joint Venture*s additional insured status to liability based on PSI*s conduct. This absence distinguishes section 9 from the additional insured language in the liability policies in the decisions on which defendants rely in pages 13-15 in their motion for summary judgment. The pertinent language of the policies in those cases variably speaks of coverage for "liability" or "claims~~ "arising out of the work of the named insured." See, e.g., First Ins. Co. of Hawaii v. Hawaii, 665 P.2d 648, 653 (Haw. 1983). On this same point, the court disagrees with defendants* position, as stated on page nine of their opposition, that "the presence or absence of the word ‘liability* is of no legal moment" when it comes to restricting an additional insured*s coverage to claims of vicarious liability. See Washington Sports and Entertainment, Inc. v. United Coastal Ins. Co., 7 F. Supp. 2d 1, 9 (D.D.C. 1998) (restricting coverage to vicarious ability because the policy stated the additional insured was covered for "liability arising from" the services of the primary insured); J.A. Jones Constr. Co. v. Hartford Fire Ins. Co., 269 III. App. 3d 148, 645 N.E.2d 980, 982 (III. App. 1995) (finding that a provision identical to section 9 did not limit the additional insured*s coverage to the extent of the primary insured*s negligence). On the other hand, the court finds that the Joint Venture was an "additional insured" with respect to the Crooks* action. Section 9 states that the Joint Venture is also an insured with respect to "your work," meaning the work of PSI. "Your work" is defined as ‘work or operations performed by you or on your behalf* and includes "the providing of or failure to provide warnings or instructions." See PIs.* Mot., Ex. 3, at PSI 21. Paragraph 13 of Mr. Crooks* original and amended complaint states that "[o]n or about December 13, 1996, pursuant to the subcontract agreement, Plaintiff was assigned to install light fixtures in an elevator shaft." See Pis.* Mot., Exs. 4-5. Paragraph 14 states that the Joint Venture provided the elevator and an operator for use in transporting Mr. Crooks. See id. In other words, Mr. Crooks* action against the Joint Venture concerned PSI*s work and operations, thereby making the Joint Venture an additional insured for purposes of Mr. Crooks* legal action. Moreover, the Crooks action invoked Twin City*s duties to defend and to indemnify the Joint Venture as an additional insured. An insurer*s duty to defend is triggered if the allegations of the complaint may bring it within the coverage of the policy. See American Continental Ins. Co. v. Pooya, 666 A.2d 1193, 1198 (D.C. 1995) (emphasis added). Mr. Crooks claimed, among other things, that he suffered bodily injury as a result of the Joint Venture*s negligence. The insurance policy states that the insurer "will pay those sums that the insured becomes legally obligated to pay as damages because of ‘bodily injury* . . . to which this insurance applies." See Pls.* Mot, Ex. 3, at PSI 10. The policy applies "only to ‘bodily injury* []caused by an ‘occurrence*; and the ‘bodily injury* ... occurs during the policy period." See id. The court hereby incorporates plaintiffs* reasons on pages 18-19 of their motion as to how the allegations in the Crooks* complaint fell with the policy*s scope of coverage. The Crooks* action also triggered Twin City*s duty to indemnify. "The duty to defend, however, should be distinguished from the duty to pay a judgment." See American C*oniintena/ Ins. Co., supra, 666 A.2d 1193 atl 198. "‘[TIhe duty to indemnify, i.e.. ultimate liability, depends rather upon the true facts."* Id. (internal citation omitted). Mr. Crooks was granted a judgment as a result of the Joint Venture*s failure to provide a reasonably safe work environment. See Pis.* Mot., Exs. 10-1 1. In his amended complaint, Mr. Crooks had alleged that the Joint Venture had negligently failed to provide such an environment. See PIs.* Mot., Exs. 5, ¶20. The court incorporates plaintiffs* reasoning, stated on page 20 of its motion, as to how the jury*s findings in the Crooks action fell within the insurance policy*s terms. 2. PSI*s Duty to Defend and To Indemnify Plaintiffs contend also that the subcontractor, PSI, had a duty to defend and indemnify the Joint Venture in the Crooks* action pursuant to the indemnification clause in the subcontract. PSI and the other defendant contend that the Crooks* matter fell within the exclusionary provision (the last sentence) of the indemnification clause. They argue that, therefore, these duties were not triggered. The indemnification clause states, in pertinent part* that:
Defs.* Mot., Ex. A, at 5. With respect to PSI*s duty to defend, plaintiffs assert that PSI had to defend them because Crooks* complaint did not state that the Joint Venture was the sole cause of his injury. addition, despite the fact that the jury found that the Joint Venture*s negligence caused Mr. Crooks* injury, plaintiffs argue that they were not the sole cause because the jury determined that Mr. Crooks had assumed one of the risks that caused his injury. Defendants claim that PSI was relieved of its duty to defend because Mr. Crooks* injury resulted solely from the Joint Venture*s negligence, despite the jury*s finding that Mr. Crooks had assumed one the risks that caused his injury. Both sets of parties support their arguments based on the instructions given to the jury and the jury*s findings in the Crooks matter. Such support carries no weight as to whether PSI had a duty to defend the Joint Venture in the Crooks* action. "[T]he obligation to defend ‘is not affected by facts ascertained before suit or developed in the process of litigation or by the ultimate outcome of the suit."* See American Cont. Ins. Co., supra, 666 A.2d at 1198 (internal citation omitted). The parties* arguments on the duty to defend require to court to determine only whether the exclusionary provision, as applied to the Crooks* action, relieved PSI of its duty to defend the Joint Venture. The duty to defend is triggered if the allegations of the complaint may bring it within the coverage provided by the contract. See id. (emphasis added). The indemnification clause, stated another way, required PSI to defend the Joint Venture for a claim of injury resulting from the Joint Venture*s negligence and a cause other than the Joint Venture*s negligence. Mr. Crooks* complaint explicitly points to the negligence of the Joint Venture as the cause of his injury. However, his allegations in the complaint suggest another cause of his injury, namely his own conduct in riding on top of the elevator car. "Plaintiff.., positioned [] [himself] on top of the elevator car provided by Defendant Mid-American Elevator [a.k.a. the Joint Venture." Pls.* Mot., Exs. 4-5 ¶17. "Vv~hile riding on top of the elevator, the elevator suddenly ‘jerked* thereby causing Plaintiff to lose his balance." Id, Exs. 4-5 ¶20. Thus, the allegations of Mr. Crooks* complaint may provide for coverage since those allegations point to a cause other than the Joint Venture*s negligence. Therefore, PSI was not relieved of its duty to defend the Joint Venture. With respect to PSI*s duty to indemnify, plaintiffs go to great lengths to demonstrate that the assumption of the risk instruction given in the Crooks* case overlapped with the contributory negligent instruction while defendants go to great lengths to counter this. It has been held that in certain contexts the assumption of the risk instruction and the contributory negligence instruction do overlap. See, e.g., Janifer v. Jandebeur, 551 A.2d 1351, 1352 (D.C. 1989). In such contexts, the assumption of the risk instruction does not rest on theory that the plaintiff consented to or waived the risk. See Sinai v. Polinger, 498 A.2d 520, 525 & n.5 (D.C. 1985). Presumably, the parties go to their efforts because proximate cause is an element of contributory negligence but not of assumption of the risk, see Standardized Civil Jury instruction for the District of Columbia (1998), No. 5-17 cmt., and because Mr. Crooks was found to have assumed the risk of one of his injuries but not found to have been contributorily negligent, see Pls.* Mot., Ex. 12. In essence, the issue that the parties squabble over appears to be whether the assumption of the risk instruction given in the Crooks* case was essentially a contributory negligence instruction. If it was, so the argument goes from plaintiffs* perspective, Mr. Crooks was a cause of his injury. If the instruction was not, so the argument goes from defendants* perspective, then the Joint Venture*s negligence was still the sole cause of Mr. Crooks* injury. The court finds that it does not have to determine the relationship between the contributory negligence and the assumption of the risk instructions in the Crooks* action. Rather, the court finds that the issue regarding PSI*s duty to indemnify is better resolved by looking at the word "caused" in the indemnification clause. Thus, the need to distinguish between the assumption of the risk and contributory negligence instructions evaporates. While recognizing that the subcontract is not an insurance policy, the court finds guidance in the general rule [that], unless it is obvious that the words which appear in an insurance policy are intended to be used in a technical connotation, the words will be given the meaning which speech imparts." See Oler v. Liberty Mut. Ins. Co., 297 A.2d 333, 335 (D.C. 1972). The court does not find anything in the subcontract that requires that the word "caused" in the indemnification clause should be construed to have the legal meaning of "proximately caused." Rather, the court shall construe the word cause with an ordinary meaning of "something which brings about an effect." Mr. Crooks* waiver or consent to the risk of riding on top of the elevator was also something that brought about his injury. In making this finding, the court recognizes that the concept of proximate cause exists in the law, rather than cause alone, because the causal connection between an occurrence and an injury may arguably be limitless. However, Mr. Crooks* decision to perch himself atop the elevator, and thereby assume any attendant risks, does not present such a tenuous relationship to his injury. Because Mr. Crooks* assumption of a risk of his injury was a cause within meaning of the word "caused" in the indemnification clause, the Joint Venture*s negligence was not the sole cause of that injury. Therefore, PSI has not been relieved of its duty to indemnify the Joint Venture, or its subrogated insurer, defendant Travelers. 3. PSI*s Liability for Costs and Attorney*s Fees in This Action The court hereby adopts the reasoning on page 21 of plaintiffs* motion. Thus, it finds that PSI is liable for plaintiffs* costs and attorney*s fees in prosecuting this action. Accordingly, it is this -- day of January, 2000, ORDERED that plaintiffs* motion for summary judgment is granted; it is FURTHER ORDERED that plaintiffs are to file with the court and to serve on defendants by the close of business on February 11, 2000 a verified statement as to amounts that they claim to be due and owing to them from defendants for (a) the settlement paid in the Crooks action, (b) the costs and attorney*s fees incurred in the Crooks action, and (c) the costs and attorney*s fees incurred in the instant action; it is FURTHER ORDERED that defendants shall have leave until the close of business on February 25, 2000 to file with the court and to serve on defendant any exceptions to plaintiffs* verified statement; it is FURTHER ORDERED that defendants* motion for summary judgment is denied.
Gregory Mize Judge SIGNED IN CHAMBERS [Note: for further discussion of contractual indemnity clauses, click here.] |
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