Honeywell International, Incor v. Lutz Roofing Company, Incorpor

433 F. App'x 399
CourtCourt of Appeals for the Sixth Circuit
DecidedAugust 8, 2011
Docket09-1877
StatusUnpublished
Cited by3 cases

This text of 433 F. App'x 399 (Honeywell International, Incor v. Lutz Roofing Company, Incorpor) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Honeywell International, Incor v. Lutz Roofing Company, Incorpor, 433 F. App'x 399 (6th Cir. 2011).

Opinion

KEITH, Circuit Judge.

This is an action for contractual indemnity and breach of contract. The case arises out of plaintiff-appellee Honeywell International’s suit against defendant-appellant Lutz Roofing Company for attorney’s fees and other costs Honeywell incurred while defending itself in a tort claim brought by Geraldo Galvan, one of Lutz’s former employees, and in prosecuting this action against Lutz. The district court held that Lutz, the subcontractor, breached its obligations to indemnify and insure Honeywell, the general contractor, under the contract governing Honeywell and Lutz’s relationship. Lutz appeals, arguing that given the terms of the contract and the scope of Mr. Galvan’s complaint, it cannot be held liable. It also argues that the district court incorrectly denied its motion as to Honeywell’s claim for breach of contract with regards to a provision re *401 quiring that Lutz obtain insurance for Honeywell. For the first time, Lutz argues, on appeal, that the fees Honeywell requests for prosecuting this action are not recoverable under Michigan law. For the reasons discussed below, we AFFIRM the district court’s rulings and decline to address Lutz’s new argument regarding attorney’s fees, finding that it was waived.

Factual Background

Plaintiff-Appellee Honeywell was the general contractor in charge of making improvements at Algonac High School in Algonac, Michigan. Defendant-Appellant Lutz was the roofing subcontractor. The parties’ relationship was governed by the Subcontract Agreement (“Agreement”) that both parties signed.

Under the Agreement’s terms, Lutz agreed to take reasonable precautions to protect the safety of its employees. In particular, Lutz agreed to implement appropriate safety measures on its work at the site, including establishing “safety rules, posting applicable warnings and notices, erecting safety barriers, and establishing proper notice procedures to protect persons and property at the site and adjacent thereto from injury, loss or damage.” R. 6-2, Subcontract Agreement, § 8.14.3. Lutz also pledged to comply with all required and recommended governmental safety rules and regulations. The Agreement also included an indemnity clause requiring Lutz to indemnify Honeywell in certain situations:

To the fullest extent permitted by law, Subcontractor shall indemnify and hold harmless Customer, Honeywell and Owner and their agents and employees from claims, demands, causes of actions and liabilities of every kind and nature, including reasonable attorney’s fees, incurred in connection with the execution of the Subcontract Work by the Subcontractor, its subcontractors, agents, or employees to the extent such claims, demands causes of actions and liabilities result from or arise from the negligent acts or willful misconduct of the Subcontractor, its subcontractors, agents or employees. This indemnification shall extend to claims occurring after this Subcontract is terminated as well as while it is in force. Subcontractor shall not be obligated to indemnify Customer, Honeywell, or Owner for claims arising from the negligence or willful misconduct of Customer, Honeywell, or Owner or their agents of employees or caused by the design and specifications provided by such parties. The indemnity set forth in this section shall not be limited by insurance requirements or by any other provision of this Subcontract.

Id. § 10.

The Agreement separately provided that Lutz would “procure and maintain insurance on all of its operations” including General Liability insurance covering all operations. Id. § 9. Lutz agreed to name Honeywell as an additional insured under the policy and to provide Honeywell with a certificate of insurance verifying such coverage before the project commenced. Lutz obtained insurance from Lexington Insurance Company. Lutz provided Honeywell a Certificate of Insurance, supposedly extending liability coverage to Honeywell. The certificate, issued by Lutz and not by Lexington, stated that

Honeywell ... [is] an additional insured on the general liability policy ... with respect to liability arising out of ongoing and completed operations performed by the named insured on the above named project. Such insurance afforded to the additional Insured(s) shall be primary and not excess over ... any insurance purchased....

*402 R. 8-10, Certificate of Liability Insurance. However, the insurance Lutz procured from Lexington explained that “[a]ny coverage provided by this endorsement to an additional insured shall be excess over any other valid and collectible insurance available to the additional insured ... ” R. 8-16, Letter from Lexington Insurance Company to Honeywell at 3 (emphasis added).

On July 14, 2004, Geraldo Galvan, one of Lutz’s employees, was injured when he fell off the school’s roof. The district court described the fall:

Galvan was on the roof installing a pressure bar and flashing. He was not working on an exposed edge, but in a location where the roof met a short parapet wall. Galvan testified that he left the area where [he] had been working and went to get a drink of water from his lunch box, which was in the middle of the roof. He was walking toward the next area where he was to work when his boot became stuck in tar that had not been covered by gravel. This occurred near the edge of the roof, and Galvan lost his balance and fell to the concrete below. He injured his wrists and had surgery.

Galvan v. Honeywell Int’l, Inc., No. 07-12670, 2009 WL 1448934, at * 1, 2009 U.S. Dist. LEXIS 43266, at *3 (E.D.Mich. May 21, 2009) (internal citation omitted).

Galvan received a settlement of a worker’s compensation claim from Lutz’s insurer, and then, along with his wife, Lourdes Galvan, sued Honeywell. The action was filed in state court and removed to federal court on the basis of diversity jurisdiction. The Galvans alleged that Honeywell was negligent in failing to take reasonable safety precautions. They specifically claimed:

There was no gravel on the sticky asphalt on which Plaintiffs foot became stuck. There were barriers along the perimeter of the roof initially at the start of the project. However, there were no flags, warnings, barriers, railings, fall arrest devices or guard rails after the first two or three days of the project. Honeywell did not inspect or require any safety devices and warnings.

R. 8-11, Galvan’s Answer to Honeywell’s Discovery Request at 5.

The Galvans did not file a separate claim against Lutz for these same failures, as the Workers’ Disability Compensation Act barred them from doing so. However, when deposed, their experts explained that Lutz had failed to use proper safety measures as it had pledged to do in the Agreement and that if such measures had been taken, Mr. Galvan would not have been injured. In response to a question regarding Lutz’s failure to use proper safety measures, Mumtaz Usmen, one of the Gal-vans’ experts, explained the preventative role perimeter guarding would have played:

Question: I take it it’s your opinion that if Lutz would be using whatever you defined as proper safety measures, that this accident could have been avoided entirely?

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433 F. App'x 399, Counsel Stack Legal Research, https://law.counselstack.com/opinion/honeywell-international-incor-v-lutz-roofing-company-incorpor-ca6-2011.