SIMP-A-LEX, INC. AND NATIONAL UNION FIRE INSURANCE COMPANY v. PREMIER ELKHORN COAL COMPANY, INC.
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RENDERED: JULY 5, 2002; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
2001-CA-001593-MR
SIMP-A-LEX, INC. AND
NATIONAL UNION FIRE INSURANCE COMPANY
v.
APPELLANTS
APPEAL FROM PIKE CIRCUIT COURT
HONORABLE CHARLES E. LOWE, JR., JUDGE
ACTION NO. 01-CI-00151
PREMIER ELKHORN COAL COMPANY, INC.
APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE:
BARBER, COMBS AND JOHNSON, JUDGES.
JOHNSON, JUDGE:
Simp-A-Lex, Inc. and its insurer, National Union
Fire Insurance Company, have appealed from an order of the Pike
Circuit Court entered on July 10, 2001, which granted summary
judgment to Premier Elkhorn Coal Company, Inc (Premier).
Having
concluded that there is no genuine issue as to any material fact
and that Premier is entitled to a judgment as a matter of law, we
affirm.
On July 3, 1997, Simp-A-Lex entered into a subcontracting agreement with Premier to provide mining support
services at one of Premier’s facilities, located in Myra, Pike
County, Kentucky.
Specifically, the contract required Simp-A-Lex
to perform line-boring and welding services.
Line-boring is
described by Simp-A-Lex, in its brief, as the “repair and
replacement of bushings, bearings and pins located on large
equipment used by [Premier] in its mining operations.”
The agreement signed by the parties employed
standardized language used by Premier in all of its subcontracting agreements.
The contract was distinguishable only by
the purchase orders, which detailed the specific work to be
performed by Simp-A-Lex, and which were incorporated into the
general agreement by reference.
Paragraph 10 of the contract set
forth Premier’s standard “Hold Harmless” provision:
Contractor [Simp-A-Lex] assumes the entire
responsibility for performance of the work
described above. Contractor agrees to
indemnify Premier Elkhorn Coal Company and
hold it harmless of and from any and all
claims for personal injury, death or property
damage, and any other loses, damages, charges
or expenses, including attorney’s fees, which
arise or are alleged to have arisen out of or
in connection with performance of the work
described on the face hereof.
The scope of this contractual language is the crux of this case.
Simp-A-Lex contends that “[t]he purpose of the indemnity
agreement was to protect [Premier] from problems associated with
the line boring and maintenance[;]” and that it “did not agree to
indemnify [Premier] for all conceivable claims which could be
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made against Premier.”
Premier argues that “[t]he language is
crystal clear in it’s [sic] meaning and purpose and unequivocally
provides that Simp-A-Lex will indemnify Premier for any damages
which are alleged to have arisen out of or in connection with the
performance of the work contemplated under the agreement between
the parties.”
On December 30, 1999, Homer Dale Roberts, an employee
of Simp-A-Lex, was performing line-boring operations on Premierowned mining equipment at its Myra facility.
Both parties agree
that Roberts had reported to the Myra facility that day to
perform work under the sub-contracting agreement between Simp-ALex and Premier.
According to Simp-A-Lex, Roberts had just
finished his line-boring operations for the day and was returning
to the machine shop when a service vehicle he was driving skidded
off a roadway and crashed, causing his death.
Roberts’s parents filed a lawsuit against Premier
alleging that its negligence in maintaining the roadway caused
their son’s death.
Following court-ordered mediation between the
parties, Premier and the Robertses entered into a settlement,
which awarded $800,000.00 in damages to the plaintiffs.
On January 29, 2001, Premier filed a lawsuit against
Simp-A-Lex for indemnification for the costs incurred due to the
Robertses’ claim.
On March 6, 2001, just 14 days after Simp-A-
Lex answered the complaint, Premier filed a motion for summary
judgment.
Premier argued that since “Roberts was an employee of
Simp-A-Lex on December 30, 1999, and during the course and scope
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of his employment with Simp-A-Lex, Inc., he was killed while
operating a service truck belonging to Simp-A-Lex, while on
Premier Elkhorn Coal Company’s property” that pursuant to the
terms of the indemnity language contained in the contract, it was
entitled to a summary judgment as a matter of law.
The Pike
Circuit Court agreed with Premier and entered a summary judgment
on July 10, 2001.
This appeal followed.
The standard of review on appeal of a summary judgment
is whether the trial court correctly found that there was no
genuine issue as to any material fact and that the moving party
was entitled to a judgment as a matter of law.1
There is no
requirement that the appellate court defer to the trial court
since factual findings are not at issue.2
“The record must be
viewed in a light most favorable to the party opposing the motion
for summary judgment and all doubts are to be resolved in [its]
favor.”3
Summary “judgment is only proper where the movant shows
that the adverse party could not prevail under any
circumstances.”4
“‘After the moving party has made a prima facie
showing that would entitle [it] to summary judgment, . . . the
adverse party has an obligation to do something more than rely
1
CR 56.03.
2
Goldsmith v. Allied Building Components, Inc., Ky., 833
S.W.2d 378, 381 (1992); Scifres v. Kraft, Ky.App., 916 S.W.2d
779, 781 (1996).
3
Steelvest, Inc. v. Scansteel Service Center, Inc., Ky., 807
S.W.2d 476, 480 (1991).
4
Id. (citing Paintsville Hospital Co. v. Rose, Ky., 683
S.W.2d 255 (1985).
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upon the allegations of [its] pleading.’”5 It is incumbent upon
the non-moving party “to make some showing in response to the
affidavit that [it] could produce proof, on the trial, in support
of [its] allegations[.]”6
Consequently, summary judgment must be
granted “only when it appears impossible for the nonmoving party
to produce evidence at trial warranting a judgment in [its]
favor....”7
Simp-A-Lex argues that a genuine issue of material fact
exists as to whether Roberts was performing activities
sufficiently connected with line-boring work to be encompassed by
the hold-harmless provision in its contract with Premier.
In
support of its position, Simp-A-Lex argues that the sentence
“Contractor assumes the entire responsibility for performance of
the work described above” and the phrase “any and all claims . .
. which arise or are alleged to have arisen out of or in
connection with performance of the work” limit its duty to
indemnify Premier.
In other words, Simp-A-Lex claims that in
order for the indemnification agreement to apply, Simp-A-Lex must
have been engaged in the “performance” of line-boring work at the
time the claim arose; and that any claim falling outside the time
period of actual “performance” of line-boring work would not be
5
Hill v. Fiscal Court of Warren County, Ky., 429 S.W.2d 419,
423 (1968)(citing Clay, Kentucky Practice, vol. 7, p. 166).
6
Tarter v. Arnold, Ky., 343 S.W.2d 377, 379 (1960)(citing
Mullins v. Weatherly, Ky., 298 S.W.2d 673 (1957)).
7
Huddleston v. Hughes, Ky.App., 843 S.W.2d 901, 903
(1992)(citing Steelvest, supra).
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covered by the indemnification agreement.
Thus, Simp-A-Lex
argues that summary judgment was inappropriate because it was
prohibited from developing discovery in support of its claim that
extrinsic evidence would support its interpretation of the term
“performance,” and that it was entitled to a factual finding as
to the parties’ intentions under the contract.
We disagree.
In interpreting the “hold harmless” agreement between
Simp-A-Lex and Premier, we must first determine whether the terms
of the contract are ambiguous.8
“If they are, then extrinsic
evidence may be resorted to in an effort to determine the
intention of the parties; if not, then extrinsic evidence may not
be resorted to.”9
In determining the intentions of the parties,
courts must first look to the actual language of the contract.
Unless there is more than one reasonable interpretation of the
contract, it is not ambiguous.10
In reviewing the terms of the
hold-harmless provision, we are unable to find any ambiguity
within its broad language.
We believe that the language,
“Contractor agrees to indemnify Premier Elkhorn Coal Company and
hold it harmless of and from any and all claims . . . , which
arise or are alleged to have arisen out of or in connection with
performance of the work” [emphasis added], resolves all doubt in
favor of Premier.
As Premier points out, Simp-A-Lex has failed
8
Central Bank & Trust Co. v. Kincaid, Ky., 617 S.W.2d 32, 33
(1981).
9
Id.
10
Id.
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to assert any reason that Roberts would have been driving a
vehicle on its roadway at the time he was killed other than the
fact that he was there “in connection with” the performance of
line-boring work.
Since no ambiguity exists, the use of
extrinsic evidence is not allowed, and any effort by Simp-A-Lex
through further discovery to produce extrinsic evidence relevant
to the parties’ intentions would have been futile.
Accordingly, summary judgment was properly granted, and
the order of the Pike Circuit Court is affirmed.
ALL CONCUR.
BRIEF AND ORAL ARGUMENT FOR
APPELLANTS:
BRIEF AND ORAL ARGUMENT FOR
APPELLEE:
Richard W. Edwards
Louisville, Kentucky
Neal Smith
Pikeville, Kentucky
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