Viad Corp v. United States Steel Corporation
343 Ga. App. 609
| Ga. Ct. App. | 2017Background
- From 1908–1937 Viad’s predecessors (Armour entities) produced sulfuric acid and stored pyrite cinders (contain lead/arsenic) on an Albany, GA property.
- In 1968 Armour sold the property to USS Agri-Chemicals (later U.S. Steel); the Sale Contract and a later Assumption Agreement allocated indemnity between the parties by time and by acts/omissions.
- Sale/Assumption split liabilities: Armour (Viad) for liabilities attributable to periods prior to Jan 27, 1968 (or acts/omissions before that date); U.S. Steel for liabilities attributable to periods after closing and for those arising from U.S. Steel’s acts or omissions after closing.
- After operations and site work by U.S. Steel (demolition, construction, disturbance of cinder piles), contamination was discovered; remediation (cost ≈ $2.9M) occurred and parties each paid and sued for indemnity and/or contribution.
- The trial court granted summary judgment to U.S. Steel, holding Viad responsible for all indemnity; Viad appealed, arguing the Assumption Agreement limits Viad’s obligation and does not indemnify U.S. Steel for U.S. Steel’s own negligence.
Issues
| Issue | Viad’s Argument | U.S. Steel’s Argument | Held |
|---|---|---|---|
| Whether Assumption Agreement requires Viad to indemnify U.S. Steel for losses arising from U.S. Steel’s post-closing acts/omissions (including negligence) | Agreement limits Viad to pre-1968 liabilities; it does not cover U.S. Steel’s post-closing negligence | Viad produced contaminants; broad “arising out of” language makes Viad liable for all contamination costs | Reversed in part: Agreement does not indemnify U.S. Steel for U.S. Steel’s own negligence absent clear, express language providing for that indemnity |
| Proper interpretation of indemnity language (“arising out of” / “arising from”) and harmonization of reciprocal clauses | Contract must be read as a whole; reciprocal clauses obligate U.S. Steel for post-closing acts | U.S. Steel relied on broad causal language to assign total responsibility to Viad | Court: “arising out of” is broad, but reciprocal clauses require harmonized reading; U.S. Steel’s post-closing acts can create its own liability under the Agreement |
| Whether indemnity for indemnitee’s own negligence is implied or requires explicit language | Indemnity for own negligence is not present in text and thus not implied | Indemnity should be read broadly to include acts/omissions (argues that covers negligence) | Held: Georgia law requires express, unequivocal language to indemnify an indemnitee for its own negligence; such language is absent here |
| Whether summary judgment was proper given disputed factual record and pending discovery | Summary judgment premature given discovery disputes and factual disputes about extent/timing of contamination and U.S. Steel’s conduct | Sought summary judgment; argued legal entitlement under contracts and contribution law | Court vacated/specified limited reversal: questions of apportionment, negligence, and contribution require factfinding; remand for further proceedings and discovery |
Key Cases Cited
- Lau’s Corp. v. Haskins, 261 Ga. 491 (explains summary judgment standard and nonmoving party burden)
- Willesen v. Ernest Communications, 323 Ga. App. 457 (contract interpretation is a question of law; ambiguity analysis)
- Firmani v. Dar-Court Builders, 339 Ga. App. 413 (indemnity clauses strictly construed against indemnitee; clarity required to cover indemnitee’s negligence)
- Ryder Integrated Logistics v. BellSouth Telecommunications, 281 Ga. 736 (contractual indemnities do not extend to indemnitee’s own negligence absent express language)
- BBL-McCarthy, LLC v. Baldwin Paving Co., 285 Ga. App. 494 (scope of “arising out of” is broad — almost any causal connection suffices)
- Allstate Ins. Co. v. City of Atlanta, 202 Ga. App. 692 (insufficiently specific indemnity language cannot be read to cover indemnitee’s negligence)
- PCS Nitrogen v. Ashley II of Charleston, 714 F.3d 161 (apportionment in soil-contamination cases requires site-specific fact analysis)
- Virginia Ins. Reciprocal v. Pilzer, 278 Ga. 190 (contribution among joint tortfeasors governed by pro rata principles; factual determination required)
- Tafel v. Lion Antique Cars & Investments, 297 Ga. 334 (trial court has broad discretion to fashion equitable remedies)
- Smith v. Branch, 226 Ga. App. 626 (continuing migration of contamination can preclude partial summary judgment)