Western Constructors, Inc., a Corporation v. Southern Pacific Company, a Corporation

381 F.2d 573
CourtCourt of Appeals for the Ninth Circuit
DecidedSeptember 1, 1967
Docket20939_1
StatusPublished
Cited by5 cases

This text of 381 F.2d 573 (Western Constructors, Inc., a Corporation v. Southern Pacific Company, a Corporation) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Western Constructors, Inc., a Corporation v. Southern Pacific Company, a Corporation, 381 F.2d 573 (9th Cir. 1967).

Opinion

ELY, Circuit Judge:

Appellee, hereinafter called “the railroad,” filed suit in the United States District Court for the District of Arizona, seeking damages resulting from a collision between its freight train and a “carryall,” an earth-moving machine, operated by appellant’s employee. The appellant, which will be referred to as “the contractor,” counterclaimed for damages sustained by it in the same accident. Jurisdiction of the court below rested upon diversity of citizenship and the requisite amount in controversy. 28 U.S.C. § 1332.

Each party filed a motion for summary judgment in its favor, and both motions were denied. While the record before us does not contain pretrial statements or a pretrial order, it does reveal that pretrial proceedings were conducted. These led to the District Court’s determination that the jury trial which had been requested should be directed to the issue of liability only. It was also determined that the jury’s role should be confined to the resolution of one issue, an issue pertaining to the extent, or degree, of the railroad’s negligence, if any. After the presentation of evidence bearing upon this limited issue, the district judge directed a verdict in favor of the railroad. A judgment was entered in which it was held that the railroad was entitled to recover damages and that the contractor was not. The judgment, entitled “Partial Pinal Decree and Order Directing Entry of Judgment,” provides for the retention of the District Court’s jurisdiction for subsequent determination of the amount of the railroad’s damage. It also recites that appeal to our court is appropriate under the provisions of 28 U.S.C. § 1292(b). We thereafter granted permission for the appeal.

In 1963 the Arizona Highway Department called for bids for the construction of a segment of a new highway. Prospective bidders were informed by the department that a private road to facilitate the movement of earth across the railroad’s tracks would be provided and that the railroad would require the successful bidder to enter into an agreement with it concerning the right of way. The contractor was awarded the contract and became a party, with the railroad, to a “Private Roadway Agreement.” It was at the intersection of the private road and the railroad’s track that the collision occurred. The carryall, operated by Harold Kness, was being driven, empty, across the tracks to receive a load of dirt at a “borrow pit” on the other side. Kness had safely made many such crossings since the highway work had begun, but on this occasion his machine stalled on the tracks and was struck by the train.

The contractor’s asserted right to recover on its counterclaim is based upon the contention that the accident was caused by the negligence of the employees of the railroad. On the other hand, the railroad’s case does not depend upon a determination of fault. It rests upon a certain provision of the “Private Roadway Agreement,” as follows:

“In consideration of the exposure to hazard of the operations of Railroad by reason of the construction, maintenance and use of said roadway, Li *575 censee does hereby release and agree to indemnify and save Railroad harmless from and against all liability, claims, costs and expenses for loss of or damage to the property of either party hereto or of third persons, and for injuries to or deaths of Licensee or the agents, employees or invitees of Licensee or third persons or the employees of Railroad caused by or arising out of the presence, maintenance, use or removal of said roadway, regardless of any negligence or alleged negligence on 'the "part of any employee of Railroad.”

The railroad argues that, even though it may have been negligent, the contractor agreed, under the quoted provision, to indemnify it against the consequences of that negligence.

The contractor denies that the agreement has that effect and urges that, in any event, the question of whether it should be so interpreted is one which should have been submitted to the jury. It argues that the provision, properly construed, applies only to those losses which are “proximately caused” by the roadway itself, and that a loss cannot be said to be “caused by or arising out of the presence, maintenance, use or removal” of the roadway if it was proximately caused by the negligence of the railroad. The district judge rejected this theory, ruling that the agreement did apply to the particular mishap even though the negligence of the railroad may have contributed as a proximate cause. We agree.

We cannot accept the ingenious contention that the railroad’s loss was not one “arising out of the * * * use” of the private roadway. It may not have been “caused” solely by the “use” of the roadway, but it most assuredly would not have occurred or arisen absent the existence of the roadway and the “use” which the contractor made of it. Indeed, the collision which did, in fact, occur is probably the very specific type of risk against which the railroad’ protected itself. Furthermore, to read the agreement as the contractor suggests would render nugatory the crucial language, “regardless of any negligence or alleged negligence on the part of any employee of Railroad.” There was, of course, no dispute as to the actual terms of the agreement; therefore, the burden of interpretation was properly assumed by the court. Gray v. Joseph J. Brunetti Construction Co., 266 F.2d 809 (3d Cir. 1959).

Additionally, the contractor urges that, if the agreement was intended to afford indemnity to the railroad against losses caused by its own negligence, it is invalid. The charge of invalidity is not based upon the ground that such a provision contravenes the public policy of Arizona, and we have discovered no decision of the Arizona courts which has so held. Instead, the contractor’s objection is that the language of the provision does not unambiguously express the intention that indemnity of such breadth is to be provided. The pertinent rule has been well stated in Southern Pac. Co. v. Layman, 173 Or. 275, 279, 145 P.2d 295 (1944): “[Cjontracts of indemnity will not be construed to cover losses to the indemnitee caused by his own negligence unless such intention is expressed in clear and unequivocal terms.” We hold that the language of the indemnity clause in question satisfies that test.

As we have previously remarked, the parties filed no pretrial statements, and the District Court made no pretrial order. From the contents of the motions for summary judgment and of transcripts of pretrial proceedings, we see views which guided the District Court to the course which was taken. The one which is most significantly related to our task, as expressed by the district judge, was that the railroad was “entitled to indemnity * * * unless the conduct of the plaintiff in the operation of the train involved in the collision with the carry-all was willfully or wantonly negligent.” This opinion carried through to the judgment, although it was apparently agreed at a later time, at the beginning of the trial, that the de *576 cisive factor should be the existence,

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Bluebook (online)
381 F.2d 573, Counsel Stack Legal Research, https://law.counselstack.com/opinion/western-constructors-inc-a-corporation-v-southern-pacific-company-a-ca9-1967.