*1 provides unambigu- The contract also LINES, INC., Appellant, AIR DELTA
ously that never- those who do not consent (after get re- theless additional revenues do), coupment by those who for which SECURITY, INC., Appellee. pay nothing. penalty This is not a No. 2-03-371-CV. bonus.3 Texas, Appeals Court provides unambigu- The contract also Fort Worth. ously get that those who do consent 300% costs, for non- recoupment of certain 28, 2005. April nothing. consenting parties again pay damages.4 These are not recognize
I some situations re-
ceiving equivalent economic less is the
paying more. But bonuses for a star ath- penal-
lete or salesman are not intended to
ize their but to increase re- employers,
turns for all concerned. Unless oilfield existing completely emptied
can be
wells, development further is not zero- game.
sum industry widely
Those in the oil use and here,
rely on clauses like the one
certainly consider them enforceable. See Thompson,
John R. Reeves & J. Matthew Op- Development the Model Form Interpretive Ac-
erating Agreement: An (2001). L.R. 254-55
counting, 54 Okla. provides precedent
Dorsett neither law bonus logic suggesting liquidated
nor unenforceable, why nor
clauses should be get
she should a bonus for a risk she never a “non-con- Accordingly,
took. this is not penalty.”
sent Money (“bonus. ("damages, pi. paid at 416 n. premium A 4. See id. 3. See id. at 134 to, person by, paid claimed or ordered to be expected <year-end to what is due or addition plain- injury <the compensation for loss or as bonus'%.”). $8,000 damages the defen- tiff seeks dant%.”). *2 OPINION McCOY, Justice. BOB
I. Introduction interpretation involving is a suit This four is- agreement. of an (“Delta”) sues, Airlines, com- Delta Inc. plains granting that the trial court erred Security, Inc. summary judgment for ARC (“ARC”),1 on its contrac- and Delta affirm. tual claims. We II. Factual and Procedural
Background (“Dal- 15, 1995, July Randy Dalton On ton”), a at the paraplegic, arrived Dallas Airport on Delta Fort Worth International A flight 1935. and a female attend- male ant, alleged possibly employees, to ARC be him onto airplane moved from his seat an chair, type aisle of wheelchair roll aisle designed to down the narrow jetway aircraft. Once on the an were adjacent airplane, to the a second male arrived, also a Delta purportedly attendant and was gate agent, being while Dalton transferred from chair into his his aisle wheelchair, allegedly dropped he on injured. the wheel wheelchair contractually Delta and ARC Skycap for Ser- bound (the whereby “Agreement”), vices provide would certain defined services for airport, including Delta at the wheelchair Bean, Hull, P.C., Maloney, to passengers. Horn & and assistance Delta Horn, TX, assignment Dan K. indicated Irving, Appellant. for wheelchair sheet possibly “John F.” and “Aftab” were as- Walker, L.L.P., Capps Rose Leane Med- day flight on signed assist someone ford, Richardson, D. Michael and Steven 1935; however, sheet did assignment Dallas, TX, Sanfelippo, Appellee. D. identify particular individual LIVINGSTON, occasion, B: also used its PANEL assisted. On GARDNER, McCOY, these services. perform JJ. addition, argued issue originally judgment, that the but this has failing grant trial court erred in been withdrawn. motion incident, alleged As result of the Dal- “omission” contributed Delta, ARC, ton sued injuries and two of ARC’s alleged Mr. Dalton claims he employees, Frimpong John and Aftab Mu- sustained a wheelchair transfer nir, as well as John Doe John Doe judicially incident. Delta has admitted *3 Petition, Jane Doe. In his Third Amended occurred, the incident never no and evi- Dalton asserted that “[o]ne of the two in suggest any dence exists to ARC was attendants who boarded the aircraft [and way involved. Delta is therefore es- dropped Dalton the wheelchair topped seeking indemnity from on jetway] transfer is believed to be ARC as a matter of law. either AFTAB [defendant MUNIR or 2. The express negligence doctrine JOHN [defendant FRIMPONG.... by adopted Georgia requires Texas and the event neither AF- FRIMPONG nor parties seeking indemnity for their own TAB question, is the male attendant in negligence clearly conspicuously and then JOHN DOE and JANE DOE indemnity pro- state that intention. The question.” the attendants in As to Delta requires vision Delta relies on now (1) ARC, and Dalton alleged negligence occurrence of an “act” or “omission” (2) transfer, related to the wheelchair ARC and does not state an implied warranty breach of to Dalton ARC will Delta for Delta’s that he transported would be in a reason- sole the absence of a (3) manner, ably safe responsibility for the clear intent to Delta Del- for negligent acts of respective agents their negligence, ta’s own un- provision (4) and employees, gross negligence. a enforceable as matter of law. In its First Amended Answer and Cross- Indemnity, Claim for Contractual Delta provided 3. Delta has no evidence that pled defenses, a general denial and other ARC committed an “act” or “omission” sought indemnity from ARC under the application sufficient to warrant expenses for costs or par- between might required pay Delta as a result a ties. ARC is therefore entitled to “no- of the suit. summary judgment. evidence” trial,
Before Dalton nonsuited his Likewise, Delta filed a cross-motion for against claims after evidence re- summary judgment and articulated as vealed that appearance of ARC’s em- grounds summary judg- therefor that “the ployees description differed from Dalton’s conclusively ment evidence establishes persons involved in the incident. liability the terms of the indemnity against Delta’s claim ARC was Thereafter, agreement.” written the trial also against severed from Dalton’s claims summary court denied Delta’s motion for trial, Following jury Delta. the trial judgment granted ARC’s motion a take-nothing judgment court rendered take noth- judgment that Delta in against favor Delta and Dalton. ing indemnity on its claim. The trial court suit, Thereafter rulings. specify did not the reasons its pursued expenses connected de- appeal This Delta followed. fending against itself Dalton’s claims. issues, ARC filed both traditional motion and a In what it denominates as four (1) summary judg- no-evidence motion for trial erred argues court asserting following grounds: ment ARC, granting summary judgment (2) Delta raised a fact issue as to 1.Delta entitled to contractual because against in the event an “act” or whether the claim Delta arose inju- (3) loss or ARC, damage, not the whether or act or omission of be- from an out of or relates of arises ry complained indemnity provision Agreement’s cause the of, or was caused test so that met hereun- by, indemnified part indemnify Delta for Delta’s ARC should nothing contained (4) der. omissions, and because sole acts or as an indem- shall be construed section by judicial admission Delta was not barred loss, lia- nity by Contractor judicial asserting that the estoppel solely from the arising claim bility or act or underlying claim arose from an misconduct negligence willful gross Agreement. of ARC under the omission Delta. *4 Allegations
III. The and the form, the first sentence short Indemnity Agreement that ARC paragraph indemnification Pleadings A.Plaintiffs all claims against Delta will that arise out acts against Delta issue, posits Delta its issue its second Agreement. under the omissions of some evidence to present as “Did Delta alleged was not to be re- Delta against that the claim Delta establish for the acts or omissions of ARC sponsible any way any arose in from act or omission acts or omissions. but rather for by contract?” An exami- ARC under the that, so, prove regard- could Even Delta Peti- nation of Plaintiffs Third Amended the act or omission pleadings, less of the tion reveals that Dalton was unsure whose by alleged Dalton was caused Delta that allegedly dropped him employees actually caused employees was result, the wheelchair transfer. As a he then Delta would be entitled employees, in the the individuals sued Delta event Agreement. under the indemnification in the were Delta’s and ARC B. of Law employ- event the individuals were ARC’S Choice ees; Delta was sued for its 13 of points paragraph out omissions, alleged acts and ARC was provi- indicates that Agreement alleged for its and omis- sued the contract are to be construed sions of sions. asserts Georgia under law. ARC apply Texas law the Texas courts will Agreement
We first examine the to de- language un- interpretation of contractual agreed termine whether ARC that there is a con- less Delta establishes Delta for ARC’s acts or omissions for on the Georgia Texas and law flict between Paragraph eight which Delta was sued. Fraud-Tech, Inc. disputed issue. See “Indemnification,” Agreement, titled Inc., 366, 377 102 S.W.3d Choicepoint, in pertinent part states as follows: denied). 2003, (Tex.App.-Fort pet. Worth indemnify, shall de- [ARC] Contractor it analyzing Georgia case that as- After fend and hold harmless Delta from to our discussion of the point” serts is “on ... of against any and all claims Agreement, in the whatsoever, any or nature includ- kind if Tex- position takes the that “even interest, to, ing, not limited court applied, the result would as law should fees, attorneys costs Therefore, analyze will we be the same.” way out of or result arise Texas law. act(s) omission(s) Contractor for Tradi- of Review performance performance in the or non C. Standards Motions and No-Evidence Agreement- of services under this tional Summary Judgment regardless of apply This section shall 670 Id.; both parties summary
When move for which there is no evidence. Johnson Pritchard, P.C., judgment grants and the trial court one v. Brewer & 73 S.W.3d other, (Tex.2002). 193, motion reviewing and denies the 207 The trial court must summary court should parties’ review both grant the motion unless the nonmovant judgment ques- evidence and determine all produces summary judgment evidence that presented. tions Props. Operating FM genuine raises a fact. issue of material Austin, City 868, 22 166a(i) Co. v. S.W.3d 872 cmt.; See Tex.R. P. & S.W. Civ. (Tex.2000). The court reviewing should Grant, 211, Elec. Power Co. v. 73 S.W.3d the judgment render that the trial court (Tex.2002). 215 We review the evidence should have rendered. Id. the light party most favorable to the summary whom the no-evidence
Texas Rule of Civil Procedure 166a does
Ranch,
judgment
King
was rendered.
prohibit
combining
in a
Chapman,
751
S.W.3d
single
request
motion a
for a traditional
—
denied,
(Tex.2003),
--,
cert.
U.S.
summary judgment
request
for a
n
(2004);
S.Ct.
158 L.Ed.2d
John
no-evidence
judgment
that as-
son,
197; Morgan
v. Antho
serts that there
“no
evidence of one or
(Tex.2000).
ny, 27
If
more essential elements of a claim or de-
*5
than
brings
nonmovant
forward more
a
Jacobo,
646,
fense.” Binur v.
135 S.W.3d
probative
scintilla of
evidence that raises a
(Tex.2004).
650
fact,
genuine issue of
then a no-
material
A defendant is entitled to a “traditional”
summary judgment
proper.
evidence
is not
summary
judgment
summary judg
266,
K
Corp.,
Moore v. Mart
981 S.W.2d
establishes,
ment evidence
as a matter of
1998,
(Tex.App.-San
pet.
269
Antonio
de
law, that at
plain
least one element of a
nied).
tiffs cause of action cannot be established.
Diaz,
than a
of
Less
scintilla
evidence exists
Elliott-Williams
v.
9
Co.
S.W.3d
(Tex.1999).
801,
when the
so
that it does
evidence is weak
803
The defendant as
nothing more than create a mere surmise
present summary judgment
movant must
suspicion
a fact.
v.
of
Kindred
negates
evidence that
an element of the
Con/
Chem, Inc.,
(Tex.1983).
61,
650 S.W.2d
63
plaintiffs
Centeq Realty,
claim.
Inc. v.
(Tex.1995).
than a
exists
195,
More
scintilla
evidence
Siegler, 899 S.W.2d
197
when the evidence would enable reason
produces
Once the defendant
sufficient evi
people
able and fair-minded
to reach dif
right
summary
dence to establish the
to
v.
ferent conclusions. Ford Motor Co.
judgment,
plaintiff
burden shifts
598,
(Tex.2004);
Ridgway,
601
competent
to come forward with
contro
Pharm.,
Havner,
953
Merrell Dow
verting
raising
genuine
evidence
issue
denied,
(Tex.1997),
cert.
S.W.2d
material fact
regard
to the element
523 U.S.
118 S.Ct.
140 L.Ed.2d
challenged by the defendant. Id.
(1998). A genuine
issue of material
adequate
After an
for discovery,
time
fact
on
presenting
is raised
evidence
proof may,
without the burden of
jury
could return a
reasonable
evidence,
presenting
without
also move for
Moore,
verdict in the nonmovant’s favor.
ground
judgment on the
that
266;
see also Anderson
support
there is no evidence to
an essential
Inc.,
242, 255-56,
Liberty Lobby,
477 U.S.
element of the nonmovant’s claim or de
2505, 2513-14,
106 S.Ct.
second of evidence Delta is claim because the deposition testimony it that was the nor provision in the satisfied the procedure mal assign for ARC to its em i.e., test, agreed ployees to passengers. assist wheelchair negli Delta for Delta’s own course, just recounting This ARC’S *6 gence. genesis express negli of the responsibilities Agreement the they agreed gence Ethyl Corp. wherein doctrine is v. Daniel provide “electric Co., cart and wheelchair assistance to Delta’s 725 708 Construction S.W.2d ” (Tex.1987), customers.... that wherein the court stated Regardless evidence, of whether this express negligence pro- [t]he doctrine alone, standing is more than a scintilla of seeking indemnify that parties vides evidence that employees were in- consequences the indemnitee from the of volved in particular the wheelchair incident negligence express its own must that Dalton, understanding that Delta em- specific the doc- intent terms. Under service, ployees provided also this negligence, of intent of express trine the conclusively through established its own parties the stated must be testimony evidence and the of Dalton that within the four corners of the contract. employees its were not involved. In Dal- In Exploration Corp. Adams Resources disposition, ton’s he testified that the non- Inc., Drilling, v. Resource transferring Delta individuals involved in 1988, no (Tex.App.-Houston [14th Dist] him from the aisle chair to the wheelchair writ), express that in the court noted wearing were male and female who were context, an indem “dark, negligence enforceable navy overall-looking kind of a blue nity must contain three elements: clause outfits ... like ... mechanic or what “(1) of thicker, parties intent must [t]he ... something would wear blue- (2) clear; it must be set forth within the employees dark blue coveralls.” ARC’S (3) shirts, ties, agreement; four corners of the were dressed dress must be ex specific parties Neither nor Af- intent of the Frimbrough slacks. John any that had rec- Id. pressed.” tab Munir testified brief, indemnify, and defend con- fully protect, In cases for reply Delta cites against any ... ... causes of ac- tractor proposition that the indemnification regardless tion ... cause or meets the re- language of fault of contractor.” Id. at 613 negligence or In quirements express that (emphasis supplied). We stated this Broth- Exploration Maxus Co. Moran language meets “the ers, Inc., (Tex.1991), intent expressly test because it states the agreed indemnify Diamond Shamrock of the that the subcontractor would parties against Moran claims Diamond Sham- indemnify the contractor for the contrac- rock’s “without limit or without Id. negligence.” tor’s own regard to the cause or causes thereof or parties.” negligence any party or Negli- Application Express F. of the a cor- (emphasis supplied). Id. There was gence Test responding reciprocal agreement by Mor- language that the asserts an. The court went on to hold that “the second sentence of the indemnification Dia- agreement unmistakably obligated states, that “This section shall paragraph indemnify mond Shamrock and Moran to or not the apply regardless of whether negli- one another the other’s loss, damage, injury ... arises out of Shamrock, gence.” Id. As to Diamond of, ... caused in reading previously of the
is clear from hereunder,” by, a indemnified part i.e., Dia- quoted agreement, section of the express negligence doctrine re- meets the agreed mond Shamrock Mor- language quirements. regardless negli- of the cause of the limited the contractual gence parties; cause eight. The first paragraph first sentence of obviously could include Moran itself. indemnity obligation, sentence defines the Adams, the court held that the fol- its param- and the second sentence defines lowing language express form, satisfies the first sentence of eters. short agrees to negligence test: “Contractor the indemnification paragraph defend, indemnify, and protect, save all against ARC will claims, all operator against from and claims Delta that arise out *7 demands, ... of action with- Agree- causes under the or omissions or thereof regard out to the cause causes ment. any party parties. or negligence or the in- The sentence that this second Exploration ...” Adams Resources applicable will be by demnification sup- Corp., (emphasis 761 S.W.2d at notwithstanding negligence of a the indemnify to
plied). Again, intent it, which is Delta. indemnified obvi- operator negligence from its own words, obligation to indemni- other ARC’S language regard ous because “without acts or Delta is sued ARC’S fy Delta if to the or causes thereof or the cause negli- if Delta is also omissions exists even could negligence any party parties” or by” in gent, part or the loss was “caused negligence operator. include the of the is there lan- Delta. nowhere indirectly says that perti- guage directly or parties, discussed Not issue, if Delta is indemnify will nent to this is B-F-W Construction ARC fault, (Tex. fault, Garza, solely at at because if Delta is Co. writ), at fault and Delta then ARC cannot be no App.-Fort Worth or omis- sued for ARC’S acts following language could this court held indemnification in required shall sions as also meets the test: “Subcontractor words, beyond consequences first sentence. In other result in unintended ARC will if indemnify Delta Delta is sued for ARC’s the facts of this case. (the obligation or omissions found in we must answer appeal, To resolve sentence)
the first even if is also First, questions: does the three (the partially at fault parameter of the agreement pass “express negligence” sentence). obligation found in the second test; obligated is ARC ever fault, however, If wholly Delta is negli- indemnify Delta for Delta’s own give acts and omissions do not rise to a Second, gence? to what extent is ARC Delta, claim and no indemnification indemnify obligated to Delta for Delta’s required. third, negligence? And do the facts As applied paragraph eight presented trigger ARC’s contractual obli- Agreement and Plaintiffs Third Amended gation Delta? To answer Petition, not required ARC was to indem- questions, plain these I first look to the nify Delta for Delta’s own acts or omis- agreement. obligation sions because this arose The consists two Delta had been sued for ARC’s acts or sentences: omissions, which it not. Accordingly, shall ... Delta [ARC] Delta’s third issue is overruled. any way from ... all claims ... which in act(s) arise out of or result from
IV. Plaintiffs Claims omission(s) by per- [ARC] issue, In its first Delta asserts error nonperformance formance or of services the trial court in “granting summary judg- Agreement.... under this Having ment favor of ARC.” overruled apply regardless This section shall Delta’s issues two and three that are dis- inju- or not damage, whether loss one, positive of issue we overrule that is- ry complained of arises out of or relates sue also. (whether active, pas- otherwise) of, sive or or was caused
V. Conclusion part by, [Delta]. first, second, Having overruled Delta’s issues, unnecessary
and third it is to ad- express negligence 1. The test. four, dress issue and we affirm the trial majority acknowledges that indem- judgment.2 court’s nity agreements similar to this one have GARDNER, concurring J. filed a opin- satisfy been held ion. Ethyl require test of so as to indemnifica- *8 negligence. tion for the indemnitee’s own GARDNER, Justice, concurring.
ANNE majority But the nevertheless states agree I majority’s language directly with the result. But “nowhere is there or I respectfully disagree interpreta- indirectly says indemnify with its that ARC will tion indemnity agreement. solely The ma- Delta if Delta is at fault.” To the jority contrary, adds terms that do not exist on the I believe the second sentence agreement, says exactly indemnify face of the that are unneces- that: will Del- ARC sary appeal, regardless injury to resolve this and that could ta of the or whether Tex.R.App. light holding regard of our to these See arguments. P. 47.1. issues, remaining we need not address Delta’s Delta, indemnify even negli- ... erwise—ARC must damage “... arises out of the at fault.1 wholly partially if or ... ... Delta is gence [Delta].” Must Circumstances 3. Under What cases, including those cited many Indemnify Delta’s Own Delta for very majority, provisions similar Negligence? here been held indemnity agreement have test so as
to meet The first sentence require indemnity for the indemnitee’s that ARC will agreement states negligence. sole The second sentence “in arise out way for claims that compara- here omissions(s) act(s) or of or result from the in those cases. I language ble to the non- performance ... in the or by [ARC] express negli- that it meets the would hold Agree- under this performance of services ARC to indem- gence obligate test so as to majority ment.” The assumes resulting solely for claims nify Delta indemnity obli- language limits ARC’s Delta’s own arising out of ARC’s only to claims gation omissions, no such acts or but
negligent ARC Indemni- 2. To Extent Must What agreement. expressed limitation is Negli- fy Delta for Delta’s Own or omissions” do not nec- The words “acts gence? and have not essarily connote suggested interpreted in the manner been majority that ARC is never The writes majority.2 language exists by the Similar for claims obligated to as dis- indemnity agreements, in most solely negli- from Delta’s own that arise majority. cited cussed in the cases conclu- gence. majority The derives this words, claim could arise out of In other from its that Delta sion observation omission. non-negligent act or ARC’s fault, cannot at solely at then ARC be Likewise, synony- “arising out of’ is irrelevant (though fault. This is true “ out of by.” ‘Arising majority mous with “caused indemnity question). significance much broader solely at fault are words of then reasons that if Delta is ” Natl Ins. Co. claim, by.’ arise than ‘caused Utica the claim could not for then Co., Indem. I re- Tex. v. Am. act or omission of ARC. (Tex.2004) Ball Motor (citing Red majority adds disagree. The spectfully Mut. Liab. Ins. Freight, Employers indemnity agreement: two words to the (5th Cir.1951)). Co., 374, 378 agree- 189 F.2d “solely” Nothing “fault.” .the simply there is “Arising out of’ means must or ment fault — im- relationship causal connection indemnity obligation partially —before causation, not necessari- for” plies claim arises from “but long as the applies. So Id. causation. ly proximate or oth- direct negligent act or omission— provided indem- negligence that for ARC's in- tor's own majority also assumes that 1. The "damage ... demnity obligation exists where Delta is nification of the contractor negligent acts or omissions. negligent sued for ARC's by ... act or omission caused agreement nor Neither the anyone omissions] whose acts \or a limitation of supports law such the case may be liable." contractor *9 indemnity obligation to Delta's vicari- ARC's 1992, 867, (Tex.App.-Houston [1st Dist.] liability. ous added). denied) (emphasis If the indem- writ similar nity agreement had contained here Rom, Inc., Servs., Bldg. Inc. v. 2. In Jobs majori- agree language, with the then I would sufficiently indemnity agreement was held not interpretation. ty's indemnity specific require for the contrac- easily imagine arising employees I can a claim out claim that ARC’s non-negligent performance ARC’s of performing services under the contract contract services but caused Del- abandoned, ARC’s obli- majority’s ta’s Under the in- gation triggered was not as a matter of terpretation agreement, such a Therefore, join majority I law.4 claim not trigger does ARC’s affirming summary judgment. obligation. plain language But the
indemnity provision compels opposite
conclusion: ARC must Delta for arising
all claims acts ARC’s contract, even if Delta’s injury.
caused the
The first sentence simply imposes a ba requirement sic of a nexus between PRIESMEYER, formerly CTTI INC. injuries contract; damage and the Tiltwall, known as Central Texas indemnity obligation ARC’s contractual Inc., Appellant, only triggered arising as to claims out of omissions ARC in perform nonperformance ance or of services under PARTNERSHIP, K LIMITED & O Mart, its contract with Delta. See Coastal Partnership, a Texas Limited Co., 839, S.W. Bell Tel. 154 S.W.3d Appellee. 2005, 845-46 (Tex.App.-Corpus Christi no No. 03-04-00051-CV. h.) pet. (holding plain meaning “arising from or connected require with” is to in- Texas, Court of Appeals of demnitee to establish “some nexus be Austin. obligations tween [indemnitor’s] under the 5,May contract and the detriment for which in 2005.
demnity sought”). majority nonetheless reaches the
right result. While I would hold itself,
agreement, passes the express negli-
gence test, indemnity obligation
would still triggered by allegations
in the underlying suit that the claimed
injuries arose out of performance or non-
performance of ARC’s services under the
contract.3 Because those pleadings were
only in the alternative as to whether
ARC’s or Delta’s were involved Barricade, Sign If the were enforce 4. See Banner & Inc. v. Price pleaded against Constr., Inc., able as to the claim Delta for (Tex.App.- 94 S.W.3d negligence, its own it would likewise be en denied) pet. (holding San Antonio issue expenses forceable as to defense costs and solely by allega- was one of law determined defending against pleaded incurred in underlying injuries tions in suit that arose out claim, though negli even Delta was found not work). of subcontractor's gent. See Fisk Elec. Co. v. Constructors & Assocs., Inc., (Tex. 1994).