Chicago & N. W. Ry. Co. v. Chicago Packaged Fuel Co.

195 F.2d 467
CourtCourt of Appeals for the Seventh Circuit
DecidedApril 23, 1952
Docket10503
StatusPublished
Cited by25 cases

This text of 195 F.2d 467 (Chicago & N. W. Ry. Co. v. Chicago Packaged Fuel Co.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Chicago & N. W. Ry. Co. v. Chicago Packaged Fuel Co., 195 F.2d 467 (7th Cir. 1952).

Opinions

KERNER, Circuit Judge.

Plaintiff, Chicago and North Western Railroad Company, a Wisconsin corporation, sued defendant for reimbursement of $55,000 paid to one Frank Drews under the provisions of a written contract whereby plaintiff licensed defendant to construct, maintain and use a coal hopper under a spur track which was a part of plaintiff’s railroad running across defendant’s premises at Chicago.

This is the .second appearance of this case. See 7 Cir., 183 F.2d 630. In that appeal we held that a serious question of law was presented as to the scope of the indemnity; that the question of negligence alone was not determinative of the issues; and that the court erred in dismissing the complaint in that it did not appear to a certainty that plaintiff would not be entitled to relief under any state of facts which it might be able to prove on the hearing.

The complaint asserted liability on the part of defendant on the ground that the accident was caused in whole or in part by or in connection with the existence, maintenance, operation and use of the coal hopper. Defendant answered denying liability, and asserted that the contract was not intended to cover a situation where the railroad was in any way negligent; that the only indemnification intended was in the case where the proximate cause of the accident was either a defect in the hopper or the negligence of the defendant. Upon remand the case was tried by the court without a jury. The trial judge made findings of fact upon which he rendered his conclusions of law and entered a judgment for plaintiff. D.C., 99 F.Supp. 361.

The record discloses that plaintiff licensed defendant to place a hopper under a spur track crossing its premises. This was done in accordance with the plans suggested and approved by plaintiff. The hopper was installed and was in operation when on February 16, 1948, Drews, an employee of Zipf Brothers Coal Company, delivered a load of coal to defendant’s plant and backed his' truck up to the hopper, stopping the rear wheels 6 or 8 inches outside the nearest rail of the track. The bed of the truck was 10 feet long and 5 feet high and at least 3 feet above the ground. The front end of the truck was 12 feet above the ground. After the truck was raised, Drews went to the left rear end of the truck, a foot or so outside of the rails, and, facing the truck which was between him and the approaching engine, opened a chute which, when the machinery in the coal hopper was started, allowed the coal to run from the truck. After the truck had been standing in this position for 20 minutes and while Drews was dumping the coal into the hopper, an engine operated by plaintiff approached from the [469]*469southwest, collided with the truck and pushed it against Drews, pinning him under the wheels of the truck. The truck, while standing at the hopper, was visible from the direction from which the engine was moving for more than 200 feet. Drews testified that he heard no bell or whistle. He did, however, see the engine, but then it was so close he was unable to get away.

The record does not disclose any evidence, or any evidence from which it could “be inferred, that the use of the hopper increased the hazards of railroading, or that the existence of the hopper between the tracks made it necessary for Drews to place himself and the truck in a dangerous position, and there was no evidence that the hopper was in any way defective or improperly used.

It is undisputed that Drews sued plaintiff to recover damages for his injuries, notice of which was given to defendant in this case, and that a demand was made upon defendant that it take over the defense on the ground that it had agreed so to do under the indemnity clause of the contract, but defendant disclaimed liability. Thereafter plaintiff settled with Drews and paid him the $55,000. No question is raised as to the seriousness of Drews’ injuries or that the settlement was not fair, wise or reasonable, and there can be no question but that the accident was due to the negligence of plaintiff.

Contained in the trial court’s findings are these facts: In order for Drews to avail himself of the use of the hopper it was necessary for him to place himself and his truck in a hazardous position; at the time of the accident, the hopper was running and Drews was in the process of dumping coal into the hopper and had been doing so for some 20 or 25 minutes; the injury to Drews arose at least in part in connection with the use of the hopper. The court concluded as a matter of law that it was exactly this kind of occurrence that the indemnity agreement was designed to meet.

The indemnity provision of the contract, prepared by plaintiff, provided: “The Licensee-assumes and agrees to pay for all loss or damage to property and injury to or death of persons, including costs and expenses incident thereto, arising, wholly or in part, from or in connection with the existence, construction, maintenance, repair, renewal, reconstruction, operation, use or removal of said facility or any defect therein or failure thereof, causing same or contributing thereto; and the Licensee shall forever indemnify the Railway Company against and save it harmless from all liability for any such loss, damage, injury and death, including all costs and expenses incident thereto.”

The question is whether the indemnity clause requires defendant to indemnify plaintiff for the damages sustained. This we must decide from the terms of the contract and the facts.

Defendant asserts that the injuries sustained by Drews were in no way connected with the contract, and that the proximate cause of the accident was neither a defect in the hopper nor the negligence of defendant. It claims that it did not agree to save plaintiff harmless from liability for injuries to persons due to plaintiff’s own negligence, and that contracts of indemnity are not to be construed to cover losses to the indem-nitee caused by his own negligence unless such an intention is expressed in clear and unequivocal terms, and it makes the point that here the proximate cause of Drews' injuries was plaintiff’s negligence.

It is conceded that the parties could enter into a contract eliminating liability for future negligence. However, such contracts are not favored, and when entered into will be strictly construed against the party relying thereon. Halliburton Oil Well Cementing Co. v. Paulk, 5 Cir., 180 F.2d 79, 84; North American Ry. Const. Co. v. Cincinnati Traction Co., 7 Cir., 172 F. 214, 216. But the courts are not in agreement as to what language in such contracts will exculpate one of the parties from liability for his future negligence. Some hold that general words are not sufficient and that to accomplish this, specific reference to negligence must be made or the intent shown by unequivocal terms. Southern Pacific Co. v. Layman, 173 Or. 275, 145 P.2d 295; Mostyn v. Delaware, L. & W. R. [470]*470Co., 2 Cir., 160 F.2d 15, 18; ThompsonStarrett Co. v. Otis Elevator Co., 271 N.Y. 36, 2 N.E.2d 35, 37; Marshall v. Maryland, D. & V. Ry. Co., 1 W.W.Harr. 170, 112 A. 526; New York Central R. Co. v. Chicago & E. I. R. Co., 360 Mo. 885, 231 S.W.2d 174; and Southern Bell T.

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Bluebook (online)
195 F.2d 467, Counsel Stack Legal Research, https://law.counselstack.com/opinion/chicago-n-w-ry-co-v-chicago-packaged-fuel-co-ca7-1952.