Caldwell Tanks, Inc. v. Tnemec Co., Inc.

417 F. Supp. 2d 179, 2006 U.S. Dist. LEXIS 8089, 2006 WL 488582
CourtDistrict Court, D. Massachusetts
DecidedFebruary 14, 2006
DocketCIV.A. 03-11726-NMG
StatusPublished
Cited by1 cases

This text of 417 F. Supp. 2d 179 (Caldwell Tanks, Inc. v. Tnemec Co., Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Caldwell Tanks, Inc. v. Tnemec Co., Inc., 417 F. Supp. 2d 179, 2006 U.S. Dist. LEXIS 8089, 2006 WL 488582 (D. Mass. 2006).

Opinion

MEMORANDUM & ORDER

GORTON, District Judge.

Pending before the Court is a motion for judgment as a matter of law that challenges a jury verdict in favor of a defendant-counterclaimant.

I. Background

The underlying case arose in connection with certain damage done to a million-gallon water tank owned by the Buzzards Bay Water District and located in Buzzards Bay, Massachusetts. The manufacturer of the tank, Caldwell Tanks, Inc. (“Caldwell”), incurred substantial costs to remedy the alleged damage to the tank and subsequently filed a lawsuit against 1) Tnemec Co., Inc. (“Tnemec”), which provided the primer for the tank, 2) Righter Group, Inc. (“Righter”), Tnemec’s sales agent, 3) Haley & Ward, Inc. (“Haley”), the engineering firm that designed the tank, and 4) Robert L. Merithew, Inc. (“Merithew”), the on-site tank inspector.

Caldwell’s complaint sought damages from Tnemec for breach of contract, breach of express and implied warranties, negligence, negligent misrepresentation and strict liability, and from Righter, Haley and Merithew for negligent misrepresentation. Haley filed a counterclaim against the plaintiff, contending that any liability on its part was precluded by a *181 contractual indemnity clause binding upon Caldwell.

After a two-week trial in April, 2005, the jury returned a verdict in favor of defendants on all counts. The jury also found that Haley had proved it was “entitled to indemnification from Caldwell for damages arising out of or resulting from the Buzzards Bay Water District project”. It awarded Haley $175,000 on the indemnification counterclaim.

On May 6, 2005, Caldwell filed a motion for judgment notwithstanding the verdict, treated here as a motion for judgement as a matter of law, in which it contends that the verdict in favor of Haley is incorrect as a matter of law. 1 Haley opposes that motion and has moved for an award of attorney’s fees incurred in preparing its opposition.

II. Discussion

A. Standard of Review

Pursuant to Fed.R.Civ.P. 50(b), a court may direct entry of judgment as a matter of law only “when after examining the evidence of record and drawing all reasonable inferences in favor of the non-moving party, the record reveals no sufficient evidentiary basis for the verdict”. Zimmerman v. Direct Fed. Credit Union, 262 F.3d 70, 75 (1st Cir.2001) (citations omitted). In making such an evaluation, the court “may not weigh the evidence, undertake credibility determinations, or engage in differential factfinding”. Id. (citation omitted). The jury verdict must be allowed to stand “unless the evidence, taken in the light most favorable to the prevailing party, points unerringly to an opposite conclusion”. Id. (citation omitted).

B. Analysis

Caldwell submits that it should be granted judgment as a matter of law, with respect to the affirmative judgment against it, on the grounds that 1) the indemnification clause on which Haley’s counterclaim was based cannot, as a matter of law, support indemnification under the circumstances and, in any event, 2) the evidence produced at trial was insufficient to entitle Haley to indemnification. Haley maintains that the jury verdict is supported by adequate legal and evidentiary bases. After careful consideration of the parties’ contentions, the Court is persuaded by Caldwell’s position.

Courts interpreting indemnification contracts under Massachusetts law are to “give effect to the parties’ intentions and construe the language to give it reasonable meaning wherever possible”. Shea v. Bay State Gas Co., 383 Mass. 218, 418 N.E.2d 597, 601 (1981).

The contractual indemnity at issue provides that:

19.1 The CONTRACTOR [Caldwell] will indemnify and hold harmless the OWNER [Water District] and the ENGINEER [Haley] and their agents and employees from and against all claims, damages, losses and expenses including attorney’s fees arising out of or resulting from the performance of the Work, provided that any such claims, damage, loss or expense is attributable to bodily injury, sickness, disease or death, or to injury to or destruction of tangible property including the loss of use resulting therefrom; and is caused in whole or in part by any negligent or willful act or omission of the CONTRACTOR, and SUBCONTRACTOR, anyone directly or indi *182 rectly employed by any of them or anyone for whose acts any of them may be liable. 2

Indemnification clauses typically shift costs from the indemnitee to the indemnitor where a third party makes a claim against the indemnitee. Courts applying Massachusetts law have dealt infrequently with indemnification in the context of in-demnitor-indemnitee litigation. Those that have addressed the issue, however, have concluded that there is no right to indemnification of claims between an in-demnitor and indemnitee unless the contract expressly contemplates such entitlement. See Petit v. Basf Corp., No. CIV.A. 96-1814A, 2001 WL 410358, at *3 (Mass.Super. April 20, 2001) (following the “principle that, in cases where the contestants have engaged in litigation with each other, an obligation upon one to indemnify the other for fees and costs should result only where the indemnity provision specifically expresses the intent of the parties to provide for costs thus incurred”); Astrolabe, Inc. v. Esoteric Technologies PTY, Ltd., No. Civ.A.01-11352, 2002 WL 511520 (D.Mass. Mar.29, 2002) (denying indemnification of a claim brought by an indemni-tee against the indemnitor because the contract provided “no indication that the parties intended [the indemnity] to cover attorney’s fees and litigation costs in an action between the parties”).

This principle is in accord with the decisions of courts applying the law of other states. See, e.g., Longport Ocean Plaza Condominium, Inc. v. Robert Cato & Assoc., Inc., 137 Fed.Appx. 464, 466-67 (3d Cir.2005) (applying New Jersey law); Layman v. Combs, 994 F.2d 1344, 1352 (9th Cir.1992) (applying California law); Bourne Co. v. MPL Commc'ns, Inc., 751 F.Supp. 55, 57 (S.D.N.Y.1990) (citing Hooper Assoc., Ltd. v. AGS Computers, Inc., 74 N.Y.2d 487, 549 N.Y.S.2d 365, 548 N.E.2d 903 (1989)).

Haley contends, correctly, that courts generally construe indemnification provisions broadly. Nevertheless, in the context of indemnitee-indemnitor litigation, courts are not so magnanimous.

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Related

Caldwell Tanks, Inc. v. Haley & Ward, Inc.
471 F.3d 210 (First Circuit, 2006)

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Bluebook (online)
417 F. Supp. 2d 179, 2006 U.S. Dist. LEXIS 8089, 2006 WL 488582, Counsel Stack Legal Research, https://law.counselstack.com/opinion/caldwell-tanks-inc-v-tnemec-co-inc-mad-2006.