Ranger Nationwide, Inc. v. National Indemnity Co.

658 F. Supp. 103, 1987 U.S. Dist. LEXIS 5097
CourtDistrict Court, D. Delaware
DecidedMarch 26, 1987
DocketCiv. A. No. 86-79-JLL
StatusPublished
Cited by6 cases

This text of 658 F. Supp. 103 (Ranger Nationwide, Inc. v. National Indemnity Co.) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ranger Nationwide, Inc. v. National Indemnity Co., 658 F. Supp. 103, 1987 U.S. Dist. LEXIS 5097 (D. Del. 1987).

Opinion

LATCHUM, Senior District Judge.

I. INTRODUCTION

This action arises out of an automobile accident involving a tractor trailer owned by defendant and third party plaintiff Jackson Freight Lines (“Jackson”) and leased to plaintiff Ranger Nationwide, Inc. (“Ranger”).1 (Docket Item [“D.I.”] 33 at ¶ 8.) Ranger settled some of the potential claims arising out of the accident and filed this action seeking indemnification from Jackson, and a declaration that an insurance policy issued to Jackson by National Indemnity Company (“National”) provides the primary coverage for any liability arising out of the accident. (D.I. 1.) Jackson and National filed an answer denying liability to Ranger and advancing a counterclaim against Ranger seeking a declaration that Ranger bears the sole responsibility for the accident (D.I. 9), and a third party complaint against American Casualty Company (“American Casualty”) and Allianz Underwriters Insurance Company (“Allianz”), re[105]*105questing indemnification from American Casualty and Allianz of any amounts owed to Ranger as a result of the accident. (See D.I. 20.) After some initial discovery all of the parties moved for summary judgment. (D.I. 34; 35; 38.)

II. BACKGROUND

The parties have stipulated to the relevant facts. (D.I. 33.) On October 27, 1983, Ranger, an authorized interstate carrier under the authority of the Interstate Commerce Commission (“ICC”), leased a tractor trailer from Jackson for the purpose of transporting goods from Virginia to New Hampshire. (Id. at Mi 5-8.) The lease agreement (“the Lease”) provided that Edward Peak (“Peak”) would drive the tractor trailer. (See id. at Ex. D.)

The operation of the tractor trailer was pursuant to Ranger’s ICC permit MC # 156490 (id.), and the Lease was thus subject to ICC regulations. See 49 C.F.R. 1057.11 (1987). The Lease complied with the applicable regulations by specifying that Ranger would maintain exclusive control over the tractor trailer and “assume full responsibility in respect to the equipment to the public, the shippers, and all regulatory bodies having jurisdiction.” (D.I. 33 at Ex. D.) Ranger also agreed to maintain insurance coverage sufficient to fulfill this obligation. (Id.) Ranger decided to maintain self-insurance for any liability amount up to $500,000, as permitted by ICC regulations. Ranger also maintained an excess liability policy with Allianz covering liability above $500,000 but less than $10,000,000 (id. at Ex. B), and a public liability surety bond with American Casualty in the amount of $1,000,000. (Id. at Ex. A.)

The Lease contained an indemnification provision whereby Jackson agreed to indemnify Ranger for “any and all losses sustained by lessee [Ranger] resulting from the use of the aforesaid equipment.” (Id. at Ex. D.) Jackson also agreed to maintain adequate insurance for this purpose. (Id.) Jackson attempted to obtain such insurance from National in the amount of $500,000. (Id. at Ex. C.)

On October 28, 1983, while operating the leased tractor trailer, Peak collided with a passenger car traveling north on Interstate 95, in the State of Delaware. (D.I. 33 at 118.) Palmer Swaine, an occupant of the passenger car, died as a result of the injuries he sustained in the accident. (Id. at If 9.) Harold Flood, Elizabeth Flood, Nathan Howell, and Ruth Howell all sustained serious injuries as a result of the accident. (Id.)

Ranger settled the claims arising out of Palmer Swaine’s death for $226,208.32. (Id. at Ex. E.) Ranger and Jackson jointly settled the claims of Harold and Elizabeth Flood for $20,000. (D.I. 33 at If 11.) Nathan and Ruth Howell’s claims are currently being litigated in the New Castle County Superior Court. (Id. at ¶ 12.) Ranger and Jackson are joint defendants in that suit.

III. ANALYSIS

The issues presently before the Court have arisen as cross motions for summary judgment. In order for a court to grant a motion for summary judgment, the moving party must convince the court that no genuine issue of material fact exists with regard to the motion, and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c) (1986). A court deciding a motion for summary judgment must view the facts, and all inferences therefrom, in the light most favorable to the non-moving party. Adickes v. Kress Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). It is with this standard in mind that the Court must consider the parties’ motions.

Ranger seeks summary judgment against Jackson and National based on Jackson’s agreement to indemnify Ranger for any losses Ranger incurred as a result of the accident. (D.I. 1; 34.) Ranger also seeks a declaration that the insurance policy issued to Jackson by National provides the primary coverage for the accident and operates to Ranger’s benefit insofar as Ranger has settled the majority of claims arising out of the accident. (D.I. 1; 34.)

Jackson and National deny any liability to Ranger and request that the Court grant [106]*106summary judgment in their favor, dismiss Ranger’s complaint, and declare Ranger liable for all losses resulting from the accident. (D.I. 9; 35.) Jackson and National also seek summary judgment on their third party claims against American Casualty and Allianz for indemnification of any amounts they owe to Ranger. (D.I. 20; 35.)

American Casualty and Allianz deny any liability for the accident and request summary judgment and the dismissal of Jackson’s and National’s third party complaint against them. (D.I. 27; 30; 34; 38.)

The Court is thus faced with a motion from each party in this case. Each motion is met by a cross motion. The Court will discuss each motion and its cross motion together since they are actually opposite sides of the same legal issue.

A. Ranger v. Jackson

Ranger contends that Jackson is liable for any losses Ranger incurred as a result of the accident pursuant to the indemnification provision of the Lease. (D.I. 37 at 6-10.) Jackson argues that the indemnification provision is invalid and that the applicable ICC regulations make Ranger solely responsible for the accident. (D.I. 36 at 8-10.) For the reasons stated below, this Court agrees with Ranger and will thus grant Ranger’s motion for summary judgment as to its claim against Jackson, and correspondingly deny Jackson’s motion for summary judgment as to its claim against Ranger.

At the time of the accident, Peak was operating the tractor trailer pursuant to Ranger’s ICC permit. (D.I. 33 at ¶ 8.) As an ICC authorized carrier, Ranger must adhere to various regulations when leasing a tractor trailer. See 49 C.F.R. §§ 1057.1-1057.42 (1987). All leases between an ICC authorized lessee and a non-registered lessor, involving interstate commerce, must be in writing and contain certain mandatory provisions. 49 C.F.R.

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