Opinion
No. 173.
Argued: February 6, 1969.
Decided: March 4, 1969.
APPEAL from a judgment of the circuit court for Waukesha county: WILLIAM E. GRAMLING, Circuit Judge. Affirmed.
For the appellant there were briefs by La France, Thompson, Greenquist, Evans Dye and Alfred E. La France and Adrian P. Schoone, all of Racine, and oral argument by Mr. Schoone.
For the respondent there was a brief by Love, McGraw Brown and John C. Love and Robert T. McGraw, all of Waukesha, and oral argument by Robert T. McGraw.
Facts.
On April 15, 1964, the plaintiff-appellant, Vulcan Materials Company, purchased a stone quarry business from defendant-respondent, Quality Limestone Products, Inc. The purchase agreement contained the following provision:
"Sellers agree to indemnify, hold harmless and defend Vulcan against and from any claim made by any of Sellers' employees arising out of any event that occurred prior to the cutoff point, including but not limited to, any claim filed against Vulcan by any such employees as the result of any type of injury or illness that occurred prior to the cutoff point."
The cutoff date referred to is April 20, 1964, the effective date of Vulcan's assumption of control of the business.
On October 1, 1960, one Richard Gruetzmacher had begun employment as a quarry worker for Quality. His employment continued until June 1, 1964, the last thirty-one days of which he was employed by Vulcan.
On June 8, 1964, Gruetzmacher filed an application for workmen's compensation with the industrial commission of Wisconsin. He named as responsible employers Vulcan, Quality and Conco Building Products (for whom he had worked from 1949 to 1960).
The industrial commission found that Gruetzmacher's exposure to silica while working for Quality was the cause of his disability. No finding was made as to Conco. The finding as to Vulcan was that the thirty-one days Gruetzmacher had worked for it did not cause, aggravate or further the progress of the silicosis. The date of injury for purposes of the workmen's compensation award was fixed at April 19, 1964, one day before Vulcan took over the operation.
Vulcan brings this suit against Quality for reimbursement for $2,758.51 expended by it in its successful contest of the Gruetzmacher claim against Vulcan. The trial court found that the indemnity provision in the purchase agreement did not apply in this situation and denied recovery. Vulcan appeals.
As was prudent and proper for him to do, the disability plagued employee brought his claim for workmen's compensation benefits against the three employers for whom he had worked since 1949. The claim against Conco was that between 1949 and 1960, on-the-job exposure to silica dust caused his disability. The claim against Quality was that between October 1, 1960, and April 19, 1964, on-the-job exposure to silica dust caused or contributed to his condition of silicosis. The claim against Vulcan was that between April 20, 1964, and June 1, 1964, on-the-job exposure to silica dust caused the condition diagnosed as far-advanced nodular conglomerate silicosis in both lungs. Only Quality was found responsible for such cause and such effect.
In this fact situation, does it follow that the claim brought against Vulcan rested upon an "event" that occurred "prior" to the cutoff date of April 20, 1964? In the claim against Vulcan was the applicant relying upon an "event" that took place during the three and one-half years he worked for Quality, or was he basing his claim against Vulcan on an "event" he alleged occurred during the thirty-one days he was working as a Vulcan employee? Was Vulcan being sued because of something that occurred prior to the cutoff point of April 20, 1964, or was Vulcan being sued because of something alleged to have occurred after the cutoff point? The trial court concluded that "Vulcan was a respondent, not because of Quality, but because it had been the employer of Gruetzmacher." Since Vulcan was a respondent solely because it had been Gruetzmacher's employer for the period of thirty-one days, all after the cutoff point, the trial court held "Vulcan defended itself and no one else." So the trial court denied recovery under the indemnity provision of the purchase agreement and we affirm his judgment.
Counsel for Vulcan argues backwards from the finding of the industrial commission that the silicosis was contracted before April 20, 1964, to assert that such finding makes inescapable the conclusion that the "event" involved in the claims arose prior to the cutoff point. But it is the nature of the claim against Vulcan itself, and the basis on which recovery against Vulcan was sought, that determines whether it is included within the indemnification clause in the contract. The "event" that was relied upon for recovery against Vulcan was the contracting or aggravating of silicosis during the post-cutoff point period of employment by Vulcan. The fact that the industrial commission found no factual basis for such claim does not change the basic character of the claim. It does not transform a claim based on a post-cutoff point "event" into a claim arising from a pre-cutoff point "event." Hindsight alters perspective, but does not change the post-cutoff foundation of the claim brought against Vulcan.
In sustaining the trial court in this case, we are mindful of the established rule in Wisconsin that indemnity agreements are to be strictly construed and must clearly and definitely show an intention to indemnify against a certain loss or liability. ( See Herchelroth v. Mahar (1967), 36 Wis.2d 140, 153 N.W.2d 6; Mustas v. Inland Construction, Inc. (1963), 19 Wis.2d 194, 120 N.W.2d 95, 121 N.W.2d 274; Hartford Accident Indemnity Co. v. Worden-Allen Co. (1941), 238 Wis. 124, 297 N.W. 436. See also 42 C.J.S., Indemnity, p. 569, sec. 5.) Although strict, the interpretation of the Vulcan-Quality agreement so that the claim here involved falls on the nonindemnity side of the cutoff date, we find reasonable.
By the Court. — Judgment affirmed.