92 Va. Cir. 89
Hopewell Cir. Ct.2015Background
- On April 26, 2012, contractor Sharom Prum was injured at Linde’s Hopewell, VA plant while employed by Four Square Industrial Contractors (Four Square).
- Prum alleged Linde’s negligent lockout/tagout allowed ammonia vapors to injure him; VOSH found safety violations by Linde but not Four Square; Prum received workers’ compensation from Four Square.
- Linde was sued by Prum under respondeat superior; Linde then sought leave to file a third-party complaint against Four Square based on an express indemnity clause in their purchase order.
- The indemnity clause required Four Square to indemnify Linde for damages "resulting from" occurrences in connection with Four Square’s performance under the contract.
- Court granted leave to file the third-party complaint, ordered separate trials for Prum v. Linde (tort) and Linde v. Four Square (contract), but consolidated discovery.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Linde may file a third-party indemnity claim against Four Square | Prum: Linde may not join an indemnity action where plaintiff has no independent claim against the third party | Linde: Parties made an express indemnity agreement shifting loss to Four Square | Court: Granted leave—express indemnity agreement permits third-party claim despite worker’s compensation backdrop |
| Whether trials should be separate | Prum: Requested separate trials to avoid jury confusion and prejudice | Linde: Agreed to separate trials but favored consolidated discovery | Court: Granted separate trials for tort and contract; discovery consolidated to avoid duplication |
| Choice of law (New Jersey vs. Virginia) for indemnity validity | Linde: Purchase order selects New Jersey law to govern validity of the contract | Four Square: Virginia law should apply; New Jersey rule conflicts with Virginia public policy | Court: Applied Virginia law because New Jersey’s indemnity rule conflicted with Virginia public policy |
| Whether the indemnity clause is void under Va. Code § 11-4.1 | Four Square: Indemnity provision is invalid as against public policy (indemnifies for indemnitee’s negligence) | Linde: Clause is valid; does not indemnify Linde for Linde’s own negligence | Court: Clause, read in isolation, requires indemnification for Four Square’s negligence only and is valid under Virginia law; summary judgment denied to Four Square |
Key Cases Cited
- VEPCO v. Wilson, 221 Va. 979 (1981) (no right of indemnity against employer where employee lacks a cause of action absent an express indemnity agreement)
- Safeway, Inc. v. DPI Midatlantic, Inc., 270 Va. 285 (2005) (distinguishes implied indemnity from enforceable express indemnity agreements in context of workers’ compensation)
- Paul Bus. Sys., Inc. v. Canon USA, Inc., 240 Va. 337 (1990) (parties’ contractual choice of substantive law is honored unless contrary to the public policy of the state with greater interest)
- Uniwest v. Amtech Elevator Servs., 280 Va. 428 (2010) (trial court must examine indemnity language in isolation to determine whether it is so broad as to indemnify the indemnitee for its own negligence)