*1 Griffin, Respondents v. Linda B. VAN Teri B. T. GRIFFIN and Robert Gregory Pest Eliminators and Gregory d/b/a Mack NORMAN and Mack Eliminators, Defendants, is Linda B. Van Norman Of Whom Mack’s Pest Gregory Gregory Pest Elimina- Mack d/b/a Mack Respondent also a and Appellant. Pest Eliminators tors and Mack’s (397 (2d) 378) Appeals Court and filed JJ., opinions. dissented Goolsby, Cureton Howard, Britton, & Clark- Jr., Gibbes Boyd, Rainey, W. son, Greenville, respondents. Fisher, Jr., Lathan,
Adam D. Ray of Lathan & Bar- bare, Greenville, respondents. 11, 1990.
Heard April 8, 1990.
Decided Oct.
Littlejohn, Acting Judge: (Home Griffin
Robert T. and Teri D. Griffin Buyers) initi- ated seeking this action and punitive damages actual for al- leged rеpresentations fraudulent on the of part defendants (Home Seller) Linda B. Van Norman and Mack Gregory d/b/a Mack Gregory Pest Eliminators Mack’s Pest Eliminators (Exterminator). The gravemen Buyers’ the Home com- plaint is that both the Home Seller and the Exterminator falsely that represented purchased a by house them was free of termites and moisture damage.
The Exterminator general filed a denial. The Answer of the Home Seller is twofold. The first is “For denominated a First denial) Defense” (general and the second is denominated “For a Second By Defense Cross Way Claim.” In the Cross Claim the Home Seller “That alleges: any damage suffered by the in Plaintiffs this matter due to the or negligence mis- representation of the Defendant, Mack The Gregory.” Prayer for Relief asks “that the Defendant, Court find that the Mack Gregory, d/b/a Mack’s Pest Eliminators be responsible held damages for any suffered the Plaintiffs.” by The Extermina- tor filed an Answer to the Cross Claim a asserting general alleging denial and the Cross Claim did not facts allege suffi- cient to a constitute cause of action. litigation grew
This out fact that the Home Sellers employed the provide Exterminator to a Wood Infestation Report by the required Buyers Home before sale of the the completed. house could be the sale consummated, After was it the developed report that was false.
The Exterminator Home paid $11,000 the Buyers a covenant to nоt execute. The Home the paid Seller Home Buyers $5,000 for a to covenant not execute. Neither admit- ted each liability; obviously “bought his peace.” Thereafter, the Buyers longer Home were no a party litigation. to the The Cross proceeded Claim trial before the judge with- out a The jury. judge ruled in favor of the Home Seller Exterminator, judgment the amount awarding We affirm. appeals. The Exterminator $5,000. parties remaining have well for the
It would been havе redrafted the but fail litigation pleadings, need not be fatal to the pleadings ure to new provide Com remaining parties by original The reason claim. Claim, Cross and the Answer to the the Answers and plaint, by judge. Claim were alerted to the issues trial Cross merely background litiga as a to this Complaint serves denied in answer are evi Complaint tion. in a Allegations dence of nothing.
Prior to the counsel for the Exterminator moved ground allegations dismiss the Cross Claim on sufficient to constitute a the Cross Claim do not state facts (1) on the grounds only damages cause action and $5,000 or claimed the Home Seller are which sustained (2) for a covenant not to execute and such making was she was a volunteer. The motion was denied payment simply *3 the that it could not be said as a matter of judge holding with was not entitled to recover on any law that the Home Seller He the sufficient under Rule 8 of theory. pleadings held S.C.R.C.P. We The addressed to this issue agree. exceptions are without merit. the in the court
It was the contention of Exterminator and here that the Exterminator and the Home Seller below joint judge were tortfeasors. The trial found that the Home base her claim Mack an upon alleged Seller “does not joint “Rather, of indemnification from tortfeasors. she right by claims that suffered the Griffins were the re- any damages of sole or The negligence misrepresentation.” sult Mack’s found the suffered the Griffins judge by further “that lоss the Buyers] solely by wrong was occasioned de- [Home Furthermore, he found “there fendant Mack [Exterminator].” no evidence Norman took an active that Van [Home Seller] in The alleged perpetuated upon role fraud the Griffins.” proves conclusively knowledge evidence that she had no that the certification of the Exterminator was false. The Extermi- nator no to and con- proof contrary. findings submits judge clusion of the are the evidence. amply supported
I. Town Winnsboro v. Wiedeman-Singleton, In Opin of (S.C. ion No. Ct. App. 8,1990), filed October con decided Bolton, Addy v. with currently case, held, this we quoting (1971), S.C. if wrongful that act defendant has plaintiff involved the with litigation others placed or him in such relation with others as makes it neces sary to incur expenses to such protect interest, his expenses should legal be treated as the consequence original act wrongful may be We recovered. further held re may be at cоvery had law in the form of special or in damages, in the form of equitable indemnity. Id. We overruled equity Hardwick, JKT Company, Inc. (Ct. App. 1984), which held indemnity
was to be determined on the face of the pleadings, rather than by facts in evidence trial. Winnsboro, Town
In of liability issue to the third party merits, whereas, was tried on the case, in this the third party’s suit was settled before trial. The relief sought Town Winnsboro was recovery fees incurred attorney’s in the successful trial defense of the third action. party’s Here, the Home recovery Seller seeks of the sum to set- tle the Home We Buyer’s action. view these distinctions without a difference. v. Bolton
Addy recovery “expenses” allows when the act of the wrongdoer litigation involves the innocent defendant places or him “in such relation with others as makes it neces- sary to incur Addy protect his interest.” The expenses opinion does “Ex- “expenses” attorney’s not confine fees. penses” any under thе rule include costs which are rea- sonably to defend or necessary litigation protect otherwise the innocent party’s interest. *4 settling
We hold that the of a is cost case recoverable (1) fide, under the rule if the settlement is with no bona (2) if, or the by parties; fraud the circum- collusion of stances, pro- the decision to settle is a reasonable means (3) tecting the innocent if the of party’s interest; amount the settlement is reasonable of the third esti- light pаrty’s damages expo- mated and the risk and extent of defendant’s sure if the case is tried.
524 satisfied. The set case, all three elements are
In this bona fide. The de action was Buyers’ tlement Home circumstances, settle reasonable in the cision to was which peace” costly and avoided a trial “bought it because to the Home Seller. result in a verdict adverse might possibly In likeli- was reasonable. all Finally, the amount settlement Home attorney’s costs and fees hood, it was less than the suc- in a at trial —even а Seller have incurred defense would cessful defense. Home Seller “was listed as a defen
The contention that the against allega to defend required dant in the action and was alle persuasive on her is not because the part” tions of fraud alleg her Complaint listing the as a defendant and gations of not of whether her to be of fraud are determinative ing guilty such a determination right indemnity. Rather, she has the to the found the fact is based on the evidence аnd facts ex the was Where, here, person seeking indemnity finder. is allowed. See liability, indemnity trial all onerated at from Bolton, supra; v. Town Winnsboro v. Wiedeman-Sin Inc., gleton, supra. II. In the Seller of the cost for set granting recovery Home tling Buyers’ suit, large Home the trial court relied in the Machinery, Logging measure on Stuck Pioneer 279 (1983). Court, Therein, Supreme S.C. the indemnification, on the matter of said: speaking to concerning right We note that the modern trend According is to to indemnity principles equity. look indemnity a exists when- equitable principles, such parties the relation between is that either ever is an on obligation in law or in there one equity party other, as where one indemnify person exposed act of he liability by wrongful another which does Indemnity (1968); Am. join. not Jur. Section (1944). Indemnity C.J.S. Section the trial court reached correct on Although judgment its reliance on Stuck was mis- case, facts of the instant Stuck, (the (the placed. Hastings In third sued Stuck pаrty) and his driver from party) damages arising second *5 525 jury negli- motor vehicle collision. The returned a verdict of Stuck. Stuck settled the claim gence against Pending appeal, with for an amount than the verdict. Stuck then Hastings less (the action Pioneer first brought separate party) indemnification of its the settle- litigation expenses, including ment amount. Pioneer had sold Stuck the vehicle involved in the collision. alleged
Stuck that Pioneer had warranted the vehicle as defеcts, when in fact it had several latent includ- roadworthy, a defective rear axle which made it an inher- ing assembly, de- ently dangerous product. alleged Stuck further that these fects had caused the accident. Stuck,
The trial court in as fact finder on the indem- sitting nity issue, found Pioneer had breached both its war- express ranty that the truck was and an war- roadworthy implied Stuck, See ranty of fitness for a 279 S.C. particular purpose. (2d) 25, 301 (citing 36-2-313, 36-2-316, at 554 sections 1976). Carolina, Code of Laws оf South The court also found See id. Pioneer liable in tort of the of strict theory liability. 15-73-10, Carolina, 1976, section Code of Laws of South (citing amended). It further found the defects in the caused truck the accident. in view of the verdict Significantly, jury’s prior negligence against Stuck, the court did not hold that Pio- neer’s was the sole cause of the accident. The wrongdoing court reasons simply ignored negligence, giving Stuck’s two so. doing
First, the judge claimed Pioneer had offered no evidence of Stuck’s negligence transcript Hastings other than the law, which he ruled not admissible.1 As a matter of how- ever, prove negligence, Pioneer did not have to Stuck’s be- it adjudicated pro- cause was an fact of record the same It law that a ceeding elementary before the same court. judicial judgments. court of record can take notice of its own (2d) McBee, Freeman v. 490, 494, 325, 280 S.C. 313 S.E. (Ct. 1984). Mas- App. place proof. Judicial notice takes thе Rodgers ters v. 255, Development Group, 251, 1984). (Ct. 194, final, unappealed App. ruling supported by appellate from this state. This is not court decisions Furthermore, judicial we believe the rule to be that records are admissible See, Huddleston, e.g., Glover v. App. 39 Ala. 105 So. evidence. (1957). negligence of Stuck’s adjudication was a conclusive
judgment in the action on the counterclaim. Its and a matter of record decision validity parties’ subsequent was not affected *6 Evans v. Creech 187 S.C. 371, 379, not to an pursue appeal. (1938). 197 S.E. to consider Stuck’s for a judge negligence
The
also refused
He
that because Stuck’s
did not
pleadings
second reason.
held
warranty
Pioneer’s
but rested on breach of
allege
negligence,
joint
and strict
was not a
tortfeasor. As we
liability, Stuck
not the alle-
already
above,
have
the facts
emphasized
Moreover,
gations
party’s pleading,
liability.
of a
control
Stuck did
allege
against Pioneer,
furnishing
a tort
the tort of
a
which is
Since the
product
inherently dangerous.
defective
to
was caused
the concurrent
torts of both
injury
Hastings
Pioneer,
Stuck and
were
tortfeasors under the ac-
they
joint
that term.2
cepted legal definition of
Court,
The
stated:
Supreme
affirming,
testimony
equipment
The uncontroverted
shows that
was defective
caused the ac-
equipment
and
defective
Clearly,
appel-
cident.
the claim for
arose out of
damages
liability
lant’s breach of warranties
strict
for sell-
and its
ing a dangerously
product.
defective
(2d)
Id.
The facts of this case are dramatically different. trial of the Home Seller’s Cross Claim indemnity against the Ex- terminator established that the Exterminator was guilty fraud, Seller, while the Home unlike inno- Stuck, totally was cent of wrongdoing. It was this freedom any from fault that created the in Home Seller’s him equity favor and entitled Bolton, See Town supra; equitable indemnity. Winnsboro v. Wiedeman-Singleton, supra. For this in JKT Com- reason, same the joint tortfeasor rule applied pany, Hardwick, Inc. v. supra, did not to this case. apply
III. *7 argument The of counsel that the Home Seller was a mere volunteer is without merit. The Exterminator’s made it wrongdoing necessary for her to her protect interests a third against party. “bought The Home Seller her peace” because of a in which predicament she found herself as a result of the fraudulent representations Extermina- tor. She volunteer; evils, did not she chosе the lesser of two go the worser of which was to a verdict risking $5,000, her of more than plus payment of additional attorney’s fees and costs. The amount for her “peace” was reasonable. The award of the judge trial was minimal and considering attorney costs fees allowed in Bolton. given,
For the reasons we affirm judgment of the cir- cuit awarding court Van Norman her costs as an settlement equitable indemnity.
Affirmed.
Sanders, C.J., Gardner, JJ., Bell, Shaw and concur. Cureton and Goolsby, JJ., оpinions. dissent in separate 3Ironically, acknowledged Supreme both the trial court and the that Court indemnity Stuck would have no if his fault contributed to the acci Stuck, 24-25, They simply dent. 279 S.C. at chose to 553-54. negligence read Stack’s clean out of record. Justice, dissenting:
Cureton, reasons. A cause following remand the case for the I would necessarily equitable indemnification is of action for equitable find facts in of review us to scope permits in nature and our the evi preponderance our view of the accordance with Greenville, Associates, City Ltd. v. dence. Townes (1976). 81, 221 S.E. forth in Part I of their the crite- majority opinion sets qualifies equi- whether a settlement determining ria for course, Of the trial did not ad- judge table indemnification. indicating any agreement criteria. Without with dress these criteria, I would find there is insufficient evidence these or the record to determine either that the decision settle the amount of the settlement was reasonable. to set forth the purports
I note there is an exhibit and the Griffins’ answer to inter- damages Gregory’s Griffins’ cannot, however, out I reconcile rogatories damages. also sets Indeed, damages much of the set forth on these exhibits. these documents could not have been caused the conduct state in their answer to in- Gregory. Gregory’s The Griffins they damages sustained to their home terrogatories fraud, misrepresentation, puni- $5,298, plus damages indi- damagеs. $5,298 figure tive A close examination of Surely, was to and sills. expense replace flooring cates this conduct did not cause the sills and floor to rot. Gregory’s Likewise, examination of the exhibit suggests portion not relate to the termite and damage. estimate does moisture Because Griffins claimed actual damages exceeding $16,000 the Van Normans and it can be rea- paid by Gregory inferred that a of the monies for the sonably portion paid was *8 of the infrastructure of the house repair correcting the moisture Some of these would have problem. expenses the Van by any Gregory been incurred Normans event. damage failed to discover this and/or its exis- misrepresented tence. He did not create it. judge preponderance
I differ the trial that the .with his the loss suffered supports finding by evidence In solely by Gregory. Griffins was occasioned the conduct of event, I remand this case to the trial court for а de- any would termination of reasonableness settlement. Goolsby, Justice, dissenting:
I respectfully dissent. The respondent Linda B. Van Norman’s cross-claim against appellant Mack Gregory doing business as Mack Gregory Pest Eliminators arises out of an action for fraud brought by plaintiffs Robert Griffin and Teri B. Griffin against Van Norman Gregory. The Griffins’ complaint does not allege that Van Norman was vicariously liable for Gregory’s con duct; rather, it alleges that “both” Van Norman and Gregory madе false representations about the condition of a house sold the Griffins by Van Norman and that both failed to disclose, as was their duty do, that the house had been ex damaged tensively by moisture and termite In damage. her answer, Van Norman alleges defense, second which also em braced her cross-claim, any “[t]hat damage suffered by the in this [Griffins] matter due to [was] the negligence or mis representation of [Gregory].” Van Norman, however, later paid the Griffins $5,000 to settlе their claim against her. Fol a bench lowing trial thereafter held upon Van Norman’s cross-claim, court, the trial relying upon Stuck v. Pioneer Logging Machinery, S.C. 552 (1983), found Van Norman entitled to indemnification from Gregory for the amount she the Griffins in settlement of against their claim her. I would reverse.
The Griffins’ complaint required Van Norman to defend against allegations fraud on her own part. It did not re- quire her to against defend allegations of fraud on Gregory’s part which Van Norman was аllegedly secondarily liable. Bolton, See Addy (1971) (al- S.C. 28, lowing indemnity to a landlord called upon an action brought by tenants to defend the wrongful acts of a general contractor hired landlord to make needed re- pairs to the (1944) building); § C.J.S. Indemnity 29 at 610 (“[W]here two wrongdoers are parties made defendant and they are not in pari delicto, the one secondarily liable may have a judgment over against the other being without forced action....”). to a separatе Thus, had the Griffins’ action been tried rather than settled and had it resulted in a verdict favor of Van Norman, Van Norman would not have defended against conduct imputed to her as a result of fraud committed
530 her own con- would have defended but
by Gregory defense, Greg- would have used her second and, under duct those circum- as a defense.1 Under conduct ory’s fraudulent for the ex- not have been indemnified would stances, she the action. successfully defending in incurred penses she (D.S.C. Company, Duke Power Supp. 719 F. 1310 Lightner v. mаke 1989). Griffins, then, should settled with the That she no difference. v. Wiede in Town Winnsboro that this court recognize I (S.C. Inc., October App.,
man-Singleton, Op. No. Lightner in relied that the court 1990), overruled the case Hardwick, 10, 325 S.E. JKT Inc. v. Company, upon, (Ct. ma however, I did not concur the 1984); App. correctly I court de action, as do that this jority’s believing in Town Winnsboro mis JKT and that the majority cided out to overrule it. See construed JKT when they reached Wiedeman-Singleton, Town Winnsboro v. No. Op. (S.C. and 8, 1990) (Goolsby, J., concurring App., October dissenting). that, clearly had she not reflects that Van Norman understood The record own, her and not gone to she would have had to defend settled and Gregory’s, in the sale of the house. conduct or, majority Moreover, surprising that Van Norman settled it is not it, puts “bought peace.” damage gave Van Gregory moisture After discovered the termite and contractor, report, local infestation Van Norman retained a Norman a wood Hаndy damage by Gregory. When Handy Repairs, repair found Man making repairs, underneath finished Van Norman’s husband crawled Man days inspected Handy Twenty-three after Van Man’s work.
the house and supplied only to the Griffins and them with a second Norman sold the house report given by Gregory, her the Griffins discovered wood infestation “[ejxten- widespread damage, including had termite and moisture the house damage in the ... on the hardwood floor the bedroom sive termite rear comer of the house.” the Griffins that the There is no evidence that Van Norman disclosed to damaged by repairs had moisture and termites and that house had ever been made, any buyer know. material fact that sensible home would want to been a Griffins, reveals, first provide the so far as the record with the She did not indicated, things, damage report among that the infestation other wood company.” by Gregory observed would be “corrected another Also, report, provide she did and is wood infestation which second “(2) record, following There has check list with the entries checked “no”: a (A) (B) previous [and] infestation of: Termites Other is visible evidence of “(3) wood-destroying prior treat- insects” and There is visible evidence repairs by Handy knowl- Arguably, the made Man with Van Norman’s ment.” previous infestation edge constitute “visible evidence” of a would themselves prior treatment. continues to misread JKT. Indeed, majority now They *10 say that JKT “held that the right indemnity was to be de termined on the face of the rather pleading, than facts in evidence at trial.” JKT contains no such holding. The court’s Addy JKT of the case makes it discussion clear that court understood that the “evidence in the record,” and not simply allegations set forth in the pleadings, must also be 14-15, Hardwick, considered. JKT Inc. v. Company, 284 S.C. at (2d) S.E. at 332. 325 Winnsboro, In any case, Town relied upon by and Stuck v. Pioneer Logging Machinery, the majority, (2d) 279 S.C. 301 (1983), 552 relied the trial upon by court, do support not what the does here. majority
I also dissent because Van voluntarily Norman paid $5,000 Griffins against her, settlement Griffins’ claim even though, as the court later found, there was no basis for See liability on her Indemnity part. § Am. Jur. 33 at (1968) (“Indemnity against losses does not cover losses for which the indemnitee is not liable to a third person, and . 14c(2) which he improperly Indemnity § pays.”); C.J.S. (1944) (“[A] contract of indemnity protect does not the in- demnitee against loss through payment which is entirely on his voluntary рart, in the sense that there is no legal obli- on him gation it, to make unless such payment is made with the knowledge and Vause v. approval indemnitor.”); cf. Mikell, (Ct. 1986) 65, 69, App. (“A remainderman is not entitled to reimbursement for prop- volunteer.”) erty taxes as a Van faced, Norman was not majority suggests, obligation with an that she could or, not resist legally say, as some would “an offer she couldn’t refuse.” See (“The supra (2d), Am. Jur. voluntary fact payment does not negative since a indemnity, confronted person obligation with an that he cannot legally resist not obligated to wait to be sued and to lose a reason- able opportunity compromise.”).