Charles MacHine Works, Inc. v. Butler Rental & Sales, Inc.

327 S.W.3d 779, 2010 WL 4017870
CourtCourt of Appeals of Texas
DecidedNovember 18, 2010
Docket13-09-00103-CV
StatusPublished
Cited by4 cases

This text of 327 S.W.3d 779 (Charles MacHine Works, Inc. v. Butler Rental & Sales, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Charles MacHine Works, Inc. v. Butler Rental & Sales, Inc., 327 S.W.3d 779, 2010 WL 4017870 (Tex. Ct. App. 2010).

Opinion

OPINION

Opinion by

Justice YÁÑEZ.

Appellant, Charles Machine Works, Inc. (“Charles”), appeals the trial court’s order denying its motion for summary judgment and granting summary judgment in favor of appellee, Butler Rental and Sales, Inc. (“Butler”), on Butler’s statutory claim for indemnity for losses arising out of a products liability suit. 1 By four issues, Charles contends that the trial court erred in granting summary judgment on Butler’s chapter 82 indemnity claim because Charles owed no duty to indemnify Butler for sums that Butler paid in settlement of claims for which Butler was independently liable. 2 We affirm.

I. Background

In April 2006, while' inspecting a ditch being dug at a construction site, Manuel *781 Aldape Duron Jr. was killed by a- Ditch Witch trencher manufactured by Charles and leased to Duron’s company by Butler. In April 2007, Duron’s survivors (“the plaintiffs”) sued Charles and Butler, alleging several products-liability and negligence theories against Charles and negligence theories against Butler. 3 In its original answer, Butler asserted a cross-claim against Charles for statutory indemnity pursuant to chapter 82 of the civil practice and remedies code. 4 The plaintiffs filed an amended petition on May 29, 2007.

By a letter dated January 4, 2008, Charles offered to indemnify Butler for claims that the trencher was defective, but refused to provide indemnity for any negligence claims against Butler. The letter offered to reimburse Butler for its reasonable attorneys’ fees “in defending the negligence claims successfully by obtaining a defense verdict or a dismissal with prejudice.” Charles did not receive a response to its offer.

On March 14, 2008, Charles executed a confidential settlement agreement with the plaintiffs, by which the plaintiffs settled and released all product liability claims against both Charles and Butler. However, the agreement expressly did not release the plaintiffs’ “claims based on Butler’s negligence, intentional misconduct or other act[s] or omission[s] for which Butler is independently liable.” 5 On March 24, 2008, Butler filed a supplemental answer, in which it (1) re-asserted its cross-claim against Charles for statutory indemnity and (2) asserted the affirmative defense of release, contending that the March 14, *782 2008 settlement agreement released all claims against it. 6

On May 29, 2008, Butler sent a letter to Charles, advising that it had settled with the plaintiffs for $75,000, without admitting any fault. Butler’s letter sought indemnity from Charles for the $75,000 settlement amount, plus attorneys’ fees and costs, pursuant to chapter 82 of the civil practice and remedies code. 7 On August 4, 2008, the trial court issued an “Agreed Order of Dismissal” in Butler’s favor, dismissing with prejudice “all of the [plaintiffs’] claims that have been asserted, or may have been asserted” by the plaintiffs against Butler. Thus, as of August 4, 2008, none of the plaintiffs’ claims against Butler remained pending.

On August 19, 2008, Charles filed a traditional motion for summary judgment, arguing that it was not obligated to indemnify Butler for the $75,000 in settlement monies because those funds were paid to release Butler for its own independent negligence. According to Charles’s motion, “there is evidence to suggest Butler was independently liable for Plaintiffs’ damages. The payment of $75,000 to obtain a release from any further liability is evidence that a portion of Plaintiffs’ loss is attributable to Butler’s independent negligence.” Charles also cited, as evidence of Butler’s independent liability, a statement taken from the plaintiffs’ safety expert report asserting that Butler failed to properly train and warn customers of the dangers associated with using the Ditch Witch. 8

In support of its motion, Charles attached the following summary judgment evidence: (1) its January 4, 2008 letter offering to indemnify Butler for products-liability claims; (2) an affidavit by Robert D. Tomlinson, Charles’s counsel, which verified that the January 4, 2008 letter offered to indemnify Butler for products-liability claims, but not for Butler’s own negligence; stated that the only response was Butler’s May 29, 2008 demand letter; and verified “Exhibit D,” describing the claims released by the settlement agreement, as an exhibit incorporated into the March 14, 2008 settlement agreement; (8) an excerpt from the plaintiffs’ expert report; (4) “Exhibit D” to the motion, entitled “Exhibit ‘A’ to Settlement Agreement Executed March 14, 2008,” releasing all products-liability claims against Charles and Butler; and (5) the May 29, 2008 letter from Butler demanding indemnity.

On September 2, 2008, Butler filed a traditional and no-evidence motion for *783 summary judgment, 9 which included a response to Charles’s motion and objections to (1) Nelson’s report as summary judgment evidence and (2) the characterization of Butler’s settlement as evidence of its independent culpability. In its motion, Butler asserted that (1) it was entitled to statutory indemnity unless Charles could prove the statutory exception — that Butler’s independent negligence caused the plaintiffs’ injuries — and (2) Charles could not prove that Butler’s independent negligence caused the plaintiffs’ injuries. Butler argued that Charles had the burden to prove Butler’s independent culpability, and that the evidence fails to establish any such independent culpability.

In support of its motion for summary judgment, Butler attached the following as evidence: (1) an affidavit by its counsel, Will W. Pierson, which (a) verified Exhibits 1A through IE; (b) explained why Butler’s $75,000 settlement of the plaintiffs’ claims was reasonable; and (c) outlined and explained Butler’s attorneys’ fees and expenses in defending against the plaintiffs’ claims; (2) copies of the plaintiffs’ original and first amended petitions; (3) a copy of Charles’s designation of experts; 10 (4) excerpts from the deposition of Rich Lambert, an employee of Charles and designated as an expert witness by Charles; 11 (5) Pierson’s curriculum vitae; and (6) a copy of Charles’s objections and responses to discovery requests sent by Butler.

Butler’s motion asserts that it is entitled to judgment on both traditional and no-evidence grounds. Butler argues that to avoid its duty to indemnify, Charles was required to prove Butler’s independent culpability in causing the plaintiffs’ injuries. In the section of its motion urging judgment on traditional grounds, Butler points to statements made by Charles’s own experts, Dr. Way Johnston and Rich Lambert.

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Bluebook (online)
327 S.W.3d 779, 2010 WL 4017870, Counsel Stack Legal Research, https://law.counselstack.com/opinion/charles-machine-works-inc-v-butler-rental-sales-inc-texapp-2010.