CRAIG LINDSAY V CITY OF DETROIT
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STATE OF MICHIGAN
COURT OF APPEALS
CRAIG LINDSAY AND PAULETTE LINDSAY,
UNPUBLISHED
January 17, 1997
Plaintiffs,
v
No. 183512
LC No. 93-332211 NO
CITY OF DETROIT, BEST AMERICAN
INDUSTRIAL SERVICES,
Defendant/Third-Party
Appellants,
Plaintiffs/
and
EAGLE MECHANICAL COMPANY,
Defendant,
v
BEN WASHINGTON & SONS PLUMBING &
HEATING, INC.
Third-Party Defendant/Appellee.
Before: Young, P.J., and Taylor and R. C. Livo,* JJ.
PER CURIAM.
Third-party plaintiffs, Best American Industrial Services and the City of Detroit, appeal as of
right from a circuit court order granting summary disposition of their claims for indemnification and
breach of contract against third-party defendant, Ben Washington & Sons Plumbing & Heating, Inc.
We reverse.
* Circuit judge, sitting on the Court of Appeals by assignment.
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Washington was subcontracted by Best to assist in the performance of Best’s ongoing
maintenance contract with the City at the Detroit Waste Water Treatment Plant. In the course of this
work, Washington’s employee, Craig Lindsay, injured his foot when he jumped from a catwalk to the
floor three feet below as he ran to avoid what he thought was a methane gas ignition in a pipe that he
was welding. Lindsay filed a lawsuit against the City and Best, alleging his injury was the result of the
City’s and Best’s failure to monitor, protect and warn him against the dangers of the accumulation of
methane gas in the work area. The City and Best filed a third-party complaint against Washington,
seeking indemnification pursuant to the indemnification clause in the subcontract and alleging a breach of
contract pursuant to a clause requiring Washington to add Best as an additional named insured on
certain insurance policies. Washington moved for summary disposition, arguing it was entitled to
summary disposition because (1) it had not agreed to indemnify Best and the City against the
consequences of their own negligence, (2) Lindsay’s injury did not arise out of or result from the
performance of its work under the contract, (3) Lindsay’s claim was not caused by any negligent act or
omission of itself, (4) Best had waived the contract provision regarding insurance, and (5) it is against
public policy for a subcontractor to procure insurance that includes coverage for the general
contractor’s sole negligence. The circuit court agreed with Washington’s arguments and granted
Washington’s motion for summary disposition of the third-party complaints under MCR 2.116(C)(10).
Summary disposition is appropriate under MCR 2.116(C)(10) where there is no genuine issue
of material fact with respect to a particular claim, except on the issue of damages, and the moving party
is entitled to judgment as a matter of law. Radtke v Everett, 442 Mich 368, 374; 501 NW2d 155
(1993). A court reviewing such a motion must consider the pleadings, affidavits, depositions,
admissions, and any other evidence in favor of the party opposing the motion, and grant the benefit of
any reasonable doubt to the opposing party. Id. This Court reviews a trial court’s grant of summary
disposition de novo. Stehlik v Johnson (On Rehearing), 206 Mich App 83, 85; 520 NW2d 633
(1994).
Best and the City (hereinafter collectively referred to as “Best”) argue that the trial court erred
in finding that the indemnification provision of the subcontract was inapplicable to Lindsay’s claim on the
basis that the indemnification provision did not provide indemnification for Best’s own negligence. We
agree.
Indemnity contracts are construed in accordance with the general rules for construction of
contracts. Triple E v Mastronardi, 209 Mich App 165, 172; 530 NW2d 772 (1995). As such, the
indemnity provision should be construed to effectuate the intentions of the parties. This may be
determined by the language of the provision, the situation of the parties, and the circumstances
surrounding the making of the contract. Id.; Sherman v DeMaria Bldg Co, 203 Mich App 593, 596;
513 NW2d 187 (1994). However, an indemnity contract is to be strictly construed against the drafting
party and the indemnitee. Sherman, supra at 596. It is no longer true that indemnity contracts will not
be construed to provide indemnification for the indemnitee’s own negligence absent that intent being
clearly and explicitly expressed in the contract. Id. at 596-597. Rather, a broad indemnification clause
may be interpreted to protect an indemnitee against its own negligence if that intent can be found in other
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language of the contract, the circumstances surrounding the contract, or from the purposes sought to be
accomplished by the parties. Id. at 597.
The subject clause provides in pertinent part:
To the fullest extent permitted by law, the Subcontractor [Washington] shall
indemnify and hold harmless the Owner [City] [and] Contractor [Best] . . . from and
against claims, damages, losses and expenses, including but not limited to attorney’s
fees, arising out of or resulting from performance of the Subcontractor’s work under this
Subcontract, provided that such claim, damage, loss or expense is attributable to bodily
injury . . . but only to the extent caused in whole or in part by negligent acts or omissions
of the Subcontractor, the Subcontractor’s Sub-subcontractors, anyone directly or
indirectly employed by them or anyone for whose acts they may be liable, regardless of
whether or not such claim, damage, loss or expense is caused in part by a party
indemnified hereunder.
Thus, the indemnification clause states that Best is to be indemnified to the fullest extent
permitted by law from claims arising out of Washington’s work provided such a claim is caused in part
by the negligent acts or omissions of Washington regardless of whether such claim is caused in part by
Best. Lindsay alleged that his injury was a result of negligence by Best. The affirmative defenses filed
by Best alleged that Lindsay had been comparatively negligent. The third-party complaint alleged that
Washington did not take all reasonable safety precautions with respect to the subcontract and did not
comply with all safety laws. The third-party complaint further alleged that Lindsay’s injury arose out of
or resulted from the negligent performance of Washington’s work under the contract. The
indemnification clause allows for Best to be indemnified even if Best partially caused Lindsay’s injury so
long as the injury also arose out of or resulted from the performance of Washington’s work under the
subcontract.
Washington claims that because Lindsay alleged Best had been grossly negligent that a finding of
indemnification is precluded. This is incorrect because even were a jury to find gross negligence
accompanied by a finding of comparative negligence on the part of Lindsay or Washington, then
indemnification would be triggered. Moreover, the indemnification clause merely seeks indemnification
to the fullest extent permitted by law, i.e., it does not allow for indemnification in the case of Best’s sole
negligence occasioning the accident which would be contrary to MCL 691.991; MSA 26.1146(1).
This statute is in derogation of the common law, Blazic v Ford Motor Co, 15 Mich App 377, 380
381; 166 NW2d 636 (1968), and therefore we read it narrowly. Craig v Larson, 432 Mich 346,
356; 439 NW2d 899 (1989). Whether Best was grossly negligent, however defined, or merely
negligent, is of no consequence because the statute allows indemnification unless Best was solely
negligent. Lindsay’s complaint alleged that the City and Best had been negligent. Thus neither the City
nor Best was seeking indemnification for their sole negligence, i.e., it was possible that each was
partially negligent, not to mention the fact that Lindsay may have been partially negligent.
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Best also asserts that the trial court erred in finding that the indemnification clause did not cover
Lindsay’s claim because it was premised on acts and omissions that were outside Washington’s
subcontract work. We agree.
The indemnification provision specifically states that it is intended to protect against claims
“arising out of or resulting from performance of” Washington’s work under the subcontract. The
subcontract specifically states that Washington’s “work included: [the] supply of skilled, union labor
forces; the quantity and disciplines to be determined by D.W.S.D.” Yet, other portions of the contract
raise a question of fact regarding whether the scope of Washington’s work was broader than the mere
providing of labor. Section 4.3.1 of the subcontract required Washington to take reasonable safety
precautions. Section 4.4.1 required Washington to keep the premises free from the accumulation of
waste materials and rubbish caused by operations performed under the subcontract. Both these
provisions may suggest that more than the provision of labor was being done by Washington. Indeed,
inclusion of an indemnification clause arguably would have been unnecessary if Washington was only
going to be supplying labor. Further, Best cited deposition testimony showing Washington had a
foreman on site. Accordingly, the contract is ambiguous as to the scope of the work. In this
circumstance, the court must defer to the factfinder as to the scope of the work. Thus, we are satisfied
that a genuine issue of material fact existed regarding whether Lindsay’s claim arose out of or resulted
from the performance of Washington’s work under the subcontract. Under such circumstances the
factfinder must determine the exact scope of Washington’s undertaking. DeMaria, supra at 596.
Next, Best contends that the trial court erred in granting summary disposition of its claim of
breach of contract with respect to the subcontract’s insurance provision. We agree.
The subcontract contained the following pertinent provisions regarding insurance:
13.1 The Subcontractor shall purchase and maintain insurance of the following types
of coverage and limits of liability:
Types of coverage and limits of liability shall be in strict accordance with
the types of coverage and limits of liability required in the Prime
Contract, consisting of the Agreement between Owner [the City] and
Contractor [Best] and the other Contract Documents enumerated
therein. Coverages, except Worker’s Compensation, shall name the
Contractor, Owner and Prime Contractor as additional named Insured.
*
*
*
13.3 Certificates of insurance acceptable to the Contractor shall be filed with the
Contractor prior to commencement of the Subcontractor’s Work. . . .
13.4 The Contractor shall furnish to the Subcontractor satisfactory evidence of
insurance required of the Contractor under the Prime Contract.
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These provisions require reference to the general contract to determine what coverage Washington was
required to supply. The provision of the general contract applicable to the subcontract and the instant
issue provided as follows:
If any Work is sublet, the Contractor [Best] shall require each Subcontractor
not otherwise fully and adequately protected under the Contractor’s Public Liability and
Property Damage insurance policies, to procure, purchase and maintain, during the
period of Subcontractor’s respective operations and performance of the Work at the
Site, Public Liability and Property Damage Insurance which names the City of Detroit
and Subcontractor as named insureds. The Engineer [an employee of the City] shall
determine the dollar amount of coverage of such insurance policies based on the nature
and potential hazards of the operations and performance of the Work at the Site by the
respective Subcontractors. Unless greater amounts of coverage for insurance is
provided in the Contract Documents, the minimum amount of coverage for public
liability shall be $100,000 for each and $300,000 for aggregate operations. The
amount for property damage shall be a minimum of $100,000 for each occurrence and
$300,000 for aggregate operations.
Given the fact that the scope of Washington’s work must be determined by the factfinder, the
trial court erroneously held that Lindsay’s claim did not come within the required insurance. We also
reject the argument that summary disposition of the breach of contract claim was proper because Best
waived this contract provision. Washington failed to obtain the necessary endorsement indicating Best
was an additional named insured. Washington argued this clause was waived by Best because Best let
it perform its work without requiring the endorsement. The record does not suggest that Best knowingly
waived this contractual requirement. There is a genuine issue of material fact regarding whether
Washington breached the subcontract by failing to provide the endorsement naming Best as an
additional insured and whether Best discovered this breach. Thus summary disposition of the breach of
contract claim on this ground was error. Finally, the argument that the insurance provision was void
because it required Washington to provide insurance against Best’s sole negligence is without merit. If
the insurance that the parties intended Washington to procure for Best’s benefit was coverage for Best’s
sole negligence, then that coverage would be void as against public policy. Peeples v Detroit (On
Rehearing), 99 Mich App 285, 302-303; 297 NW2d 839 (1980). However, the extent of coverage
to be provided by the insurance provisions of the subcontract was only intended to protect against
Washington’s performance of its subcontract work. As such, the insurance provisions were not
designed to cover Best’s sole negligence.
Reversed and remanded for further proceedings. We do not retain jurisdiction.
/s/ Robert P. Young
/s/ Clifford W. Taylor
/s/ Robert C. Livo
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