Heckart v. Viking Exploration, Inc.

673 F.2d 309
CourtCourt of Appeals for the Tenth Circuit
DecidedMarch 18, 1982
DocketNo. 79-2284
StatusPublished
Cited by18 cases

This text of 673 F.2d 309 (Heckart v. Viking Exploration, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Tenth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Heckart v. Viking Exploration, Inc., 673 F.2d 309 (10th Cir. 1982).

Opinion

LOGAN, Circuit Judge.

Viking Exploration, Inc. (Viking) brought this third-party action against Superior Drilling, Inc. (Superior)1, seeking indemnity for any sums Viking would have to pay as the result of a personal injury suit one of Superior’s employees brought in federal court against Viking. Viking then settled the personal injury suit and sought to recover the amount of its settlement. The trial court ruled that Viking was not entitled to indemnity. When Viking appealed, we remanded for further proceedings in light of subsequent Wyoming Supreme Court decisions interpreting applicable Wyoming law. Upon remand the trial court again denied relief. In this second appeal Viking contends that contrary to the trial court’s holding, Wyoming law does not bar its indemnity action. To resolve the issues on appeal we must consider an indemnity provision in the contract between the parties, a Wyoming statute limiting the validity of indemnity contracts, and Wyoming law on other issues affecting indemnity.

In December 1973 the two parties entered into a contract calling for Superior to drill an oil well on a Wyoming lease Viking held. Superior began drilling activities immediately. On February 16, 1974, Viking told Superior to plug and abandon the well. That afternoon, while in the process of plugging the well, Wilfred Baker, one of Superior’s crew members, was badly injured when struck by heavy machinery set in motion by another crew member’s catching his sleeve on a lever. Baker sued Viking, his complaint asserting that Viking wás liable because it was the master having the right to control the negligent employee (respondeat superior) and because Viking was itself negligent in several respects including failing to provide a safe work place, permitting unsafe equipment on the site, and selecting an incompetent operator to conduct the drilling operations. Baker also sued two of Superior’s officers, but did not sue Superior itself because Wyoming’s worker’s compensation law bars employer liability. Relying on a provision for indemnity in the contract between the parties, Viking requested that Superior assume its defense. When Superior refused, Viking brought this third-party claim for indemnity based upon contractual and common law theories.

Superior’s two officers settled with Baker for $50,000. Baker, who had sued Viking for $2,520,000, then offered to settle with Viking for another $50,000. When Viking [311]*311informed Superior of Baker’s settlement offer, Superior responded that it considered the $50,000 offer as reasonable and that if Viking refused to settle for that sum, in a subsequent indemnity claim Superior would argue that Viking had inadequately protected Superior’s interests.2 Viking then accepted Baker’s $50,000 settlement offer.

In its third-party complaint against Superior, Viking relies upon the indemnity clause in its contract with Superior, the contract clause requiring Superior to perform in a workmanlike manner, common law rights of indemnity, and rights of contribution based on comparative fault. The trial court held that Wyo.Stat.Ann. § 30-28.3 (current version at Wyo.Stat.Ann. § 30-1-131) entirely voids the contractual commitments and that Superior is not liable for the damages resulting from its employee’s injury on either a common law indemnity or contribution theory because Wyoming’s Worker’s Compensation Act provides a complete bar.3

In the first appeal we remanded for further consideration in light of Pan American Petroleum Corp. v. Maddux Well Service, 586 P.2d 1220, 1223-24 (Wyo.1978), and Mountain Fuel Supply Co. v. Emerson, 578 P.2d 1351, 1358 (Wyo.1978). See Baker v. Viking Exploration, Inc., No. 78-1344 (10th Cir. June 14, 1979). On remand the trial court expressed its uncertainty about how to proceed but, after an in-chambers discussion with the attorneys for both sides, issued an order dismissing Viking’s claims. The court concluded that Viking had voluntarily settled its claim with Baker, and it declined to disturb the voluntary settlement. This second appeal followed. We now remand again, but this time we will give the trial court more specific guidance.

I

We first focus upon the indemnity provision in the contract between the parties. It provides, in section 18.10, as follows:

“Indemnity by Contractor: Contractor agrees to protect, indemnify and save harmless the Owner from and against all claims, demands, and causes of action in favor of Contractor’s employees or third parties on account of personal injuries or death or on account of property damages (other than property damages as in this Par. 18 specifically provided for) arising out of the work to be performed by Contractor hereunder and resulting from the negligent acts or omissions of Contractor, Contractor’s agents, employees, and subcontractors.”

[312]*312That provision at least requires Superior to indemnify Viking for any claim made by a Superior employee because of an accident resulting solely from the' negligence of Superior or its employees. If it is read more broadly to indemnify against an accident in which Viking’s negligence4 was the sole or a concurrent cause, it is invalid under Wyoming law. Mountain Fuel Supply held that Wyo.Stat.Ann. § 30-28.3 (1975)5 makes unenforceable any oil and gas drilling contract to the extent it “seeks to indemnify the indemnitee for his own negligence — regardless of the character of that negligence.” 578 P.2d at 1358.

Superior asserts that even if Viking settled the case not because of its own negligence but because it feared it would be found vicariously liable, section 30-28.3 still bars indemnity. As we have explained before,

“A crucial difference exists between liability as master (respondeat superior) and direct liability. Respondeat superior is a doctrine of vicarious liability based upon public policy — the notion that the person who benefits by the acts of the servant must pay for wrongs committed by the servant; thf one held liable as master need not be at fault in any way. See Holmes, The History of Agency, 4 Harv. L.Rev. 345 (1882).”

McClelland v. Facteau, 610 F.2d 693, 695 (10th Cir. 1979). Superior relies upon Reding v. Texaco, Inc., 598 F.2d 513, 520-21 (9th Cir. 1979), which interprets the Wyoming statute as voiding an indemnity agreement when the indemnitee, though not negligent, is liable under the doctrine of respondeat superior. We do not agree with that construction of the statute. While subsection (ii) of the statute precludes indemnity from accidents in operations “carried on at the direction or under the supervision of the indemnitee ... or in accordance with methods and means specified by the indemnitee,” the act’s preamble reads as follows:

“AN ACT invalidating, as against public policy, provisions for indemnity in certain contracts where there is negligence attributable to the indemnitee, and providing an exemption thereto.”

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Bluebook (online)
673 F.2d 309, Counsel Stack Legal Research, https://law.counselstack.com/opinion/heckart-v-viking-exploration-inc-ca10-1982.