Summary
finding an indemnification clause enforceable when stating "[contractor will] indemnify ... against all loss ... however caused, regardless of any negligence of [building owner]"
Summary of this case from Reynolds v. Target Corp.Opinion
No. C0-00-35.
Filed July 18, 2000.
Appeal from the District Court, Hennepin County, File No. 987667.
James M. Mahoney, Mahoney, Dougherty Mahoney, P.A., (for respondent)
Timothy P. Tobin and Elliot L. Olsen, Gislason Hunter, LLP, (for appellant)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1998).
UNPUBLISHED OPINION
Appellant contractor challenges the district court's determination that, pursuant to the parties' agreement, appellant was obligated to indemnify respondent for the legal expenses respondent incurred in defending itself in a negligence action. Appellant first contends that he was not required to indemnify respondent because the claims made by the plaintiff in the underlying negligence action fell outside the scope of the parties' indemnity agreement. Further, appellant contends that because respondent's manager, rather than respondent itself, was a party to the contract, respondent was not indemnified under the contract. Finally, appellant contends that under Minn. Stat. § 337.02, there is a statutory prohibition against the indemnification agreement. We affirm.
FACTS
Respondent John Hancock Mutual Life Insurance Company (Hancock) owns a shopping center) that is managed by Welsh Companies (Welsh). Fleming Corporation and Fleming Companies, Inc. d/b/a Rainbow Foods (Rainbow) operate a grocery store at the center pursuant to a lease issued by Hancock.
Welsh, on behalf of Hancock, contracted with appellant S.C.S. Contracting and Services (Sheehan) to provide snow removal services for the center property. The agreement provided that Sheehan was to "keep the sidewalk, parking area, and all pedestrian areas free and clear of snow and ice." The agreement also contained an indemnity clause that provided, in pertinent part:
Contractor shall indemnify Manager and the Center Owner * * * against all loss, damage, expense and liability resulting from injury to * * * persons * * * arising out of or in any way connected with the performance of this Agreement, however caused, regardless of any negligence of Manager or Center Owner * * *.
Michael Potvin commenced a lawsuit alleging that on December 23, 1996, he was injured outside the Rainbow store due to the negligent maintenance of the property. Potvin specifically alleged that Hancock and Rainbow were negligent in allowing an accumulation of ice and snow and the development of humps, bumps, and ridges on said premises so as to cause a shopping cart to fall against and onto the body of the plaintiff and the contents thereof to strike the plaintiff on various part of his body and knock him to the ground.
Sheehan refused to indemnify Hancock for the legal expenses it incurred in defending itself at a trial, which resulted in a determination that there was no showing of negligence on the part of Sheehan, Hancock, or Rainbow. However, the district court concluded that because of the indemnity agreement, Sheehan was responsible for Hancock's attorney fees incurred in defense of the action commenced by Potvin. This appeal followed.
DECISION
A grant of summary judgment is appropriate where there are no genuine issues of material fact and where a party is entitled to judgment as a matter of law. Minn.R.Civ.P. 56.03. On review of a grant of summary judgment, this court need not defer to the district court's analysis of purely legal issues. State Farm Mut. Auto. Ins. Co. v. Ford Motor Co., 572 N.W.2d 321, 323 (Minn.App. 1997). Interpretation of an unambiguous contract, including the meaning of an indemnification clause, presents a question of law, which this court review de novo. Turner v. Alpha Phi Sorority House, 276 N.W.2d 63, 66 (Minn. 1979). Likewise, construction of a statute is also a question of law subject to de novo review. Doe v. State Bd. of Med. Exam'rs, 435 N.W.2d 45, 48 (Minn. 1989).
I. Scope of the Indemnity Agreement
Sheehan first argues that because Potvin's complaint alleged, in part, that Hancock was itself negligent, Sheehan had no duty to indemnify Hancock. We disagree. While the language of the agreement is seemingly broad enough to encompass Hancock's own negligence because it provides that the "[c]ontractor shall indemnify manager and the center owner * * * against all loss,") it still only covers work in accordance "with the performance of this agreement." Only Sheehan was responsible for performing snow and ice removal. It was the accumulation of ice and snow that Potvin alleged caused the unevenness in the surface of the lot, which resulted in his fall and injury. Accordingly, Potvin's claim did not encompass negligence on the part of Hancock as well as Sheehan and because Potvin's claim was within the scope of the indemnification agreement, the district court's determination that Sheehan was obligated to indemnify Sheehan was proper.
Even if Potivn's claim could be construed to include a claim that Hancock itself was negligent, the indemnification agreement clearly and expressly contemplates that Sheehan will indemnify Hancock, even if Hancock is the source of the negligence. The contract states that Sheehan will "indemnify * * * against all loss * * * however caused, regardless of any negligence of manger or center owner."
While the law does not favor agreements that seek to indemnify an indemnitee for liabilities caused by the indemnitee's own negligence, National Hydro Sys. v. M.A. Mortenson Co., 529 N.W.2d 690, 694 (Minn. 1995), indemnity contracts will be fairly construed so as to accomplish their stated purpose. Sorenson v. Safety Flate, Inc., 306 Minn. 300, 307, 235 N.W.2d 848, 852 (1975). Here, the contract, by its plain language, clearly states that Sheehan is responsible for all losses, including those that may have been caused by Hancock's negligence. Because the intent of the parties is clear, the district court's finding for Hancock on its indemnification claim was proper.
II. Party to the Agreement
Sheehan next argues that the district court erred when it ordered Sheehan to pay attorney fees to Hancock because Welsh, Hancock's manager, and not Hancock, was a party to the contract containing the indemnification agreement. Sheehan relies on the language of the agreement stating that he shall "indemnify Manager and the Center Owner, their officers, agents and employees." Sheehan notes that the agreement identifies Welsh Companies as the "Manager," but that "Center Owner" is not defined anywhere in the contract. Sheehan also argues that it is unclear whether John Hancock Mutual Life Insurance Company or John Hancock Reality Income Fund was the owner of the property.
Given that "Center Owner" remains undefined and is susceptible to at least two meanings, Sheehan argues that the contract is ambiguous. Thus, Sheehan argues that Hancock, as the drafter of the agreement, could have easily designated itself as the center owner and the signatory to the agreement. See Lake Cable Partners v. Interstate Power Co., 563 N.W.2d 81, 85 (Minn.App. 1997), review denied (Minn. July 10, 1997) (ambiguous terms to be construed against the drafter). But we conclude the term "Center Owner" is not ambiguous. Sheehan knew the identity of the center owner contemplated by the contract. There is no salient corporate distinction between John Hancock Mutual Life Insurance Company and John Hancock Realty Income Fund. Thus the district court's determination that Sheehan was obligated to indemnify Hancock was not erroneous.
III. Statutory Prohibition
Sheehan contends that Minn. Stat. § 337.02 prohibits enforcement of the indemnification agreement.
An indemnity agreement contained in * * * a building and construction contract is unenforceable except to the extent that: (1) the underlying injury or damage is attributable to the negligent or otherwise wrongful act or omission, including a breach of a specific contractual duty, of the promissor or the promissor's independent contractors, agents, employees, or delegatees.
Minn. Stat. § 337.02 (Supp. 1999). Construing this contract so that it falls within the purview of the statute would be to extend the statute into contracts where the legislature did not intend for it to control. Any analysis of the indemnification agreement under this statute is improper.
IV. Motion to Strike
Sheehan asks this court to strike portions of Hancock's appendix containing excerpts of depositions. The deposition transcripts were not filed with the district court. Deposition transcripts that are not filed with the district court cannot be considered part of the record on appeal. Hasan v. McDonald's Corp., 377 N.W.2d 472, 473 (Minn.App. 1985). Therefore, they are not properly part of the record on appeal, and we have not considered the excerpts.