Gust BOUNOUGIAS, Plaintiff-Appellee,
v.
REPUBLIC STEEL CORPORATION, a foreign corporation, Defendant-Appellant.
REPUBLIC STEEL CORPORATION, a corporation, Third Party Plaintiff-Appellee,
v.
Alavina O'MALLEY, d/b/a B. Pedersen & Company, Third Party Defendant-Appellant.
No. 12772.
No. 12773.
United States Court of Appeals Seventh Circuit.
April 21, 1960.
Rehearing Denied May 23, 1960.
John G. Phillips, Oswell G. Treadway, Norman Peters, Joseph H. Hinshaw, John M. Moelmann, Chicago, Ill., for Bounougias & O'Malley.
Max E. Wildman, Thomas D. Allen, Frederick W. Temple, Chicago, Ill., for Republic Steel Corp.
Before HASTINGS, Chief Judge, CASTLE, Circuit Judge, and PLATT, District Judge.
PLATT, District Judge.
Plaintiff, Gust Bounougias, brought this action against the Republic Steel Corporation, hereafter referred to as Republic. Republic in turn filed a third-party action seeking indemnity from Alavina O'Malley, doing business as B. Pedersen & Company, hereafter referred to as O'Malley, for any judgment obtained against it by the plaintiff. The entire cause was tried to a jury and plaintiff obtained a verdict and judgment of $105,000 against Republic. The trial court instructed the jury that in the event of a verdict for plaintiff, a like amount should be returned in favor of Republic and against O'Malley. The jury followed this instruction and returned a verdict in favor of Republic and judgment was entered against O'Malley for Republic in the amount of $105,000. Motions for judgment notwithstanding the verdict in accordance with prior motions were overruled. Republic and O'Malley have appealed from this ruling.
Republic contends:
1. The evidence failed to show а violation of the Act by Republic for the reason that the Structural Work Act, or Scaffold Act, does not apply to the crane from which the plaintiff fell, because
(a) The crane was a permanent part of Republic's plant; and
(b) It was not a mechanical contrivance erected or constructed for use in the repairing or painting of any building.
2. That if there was a violation it was not the proximate cause of plaintiff's injuries.
O'Malley stands on the same contentions as Republic to defeat plaintiff's recovery, and in addition contends:
1. That O'Malley, by virtue of the purchase order agreement, did not undertake to indemnify Republic for hаving wrongfully violated the provisions of the Scaffold Act;
2. Republic is barred from recovery from O'Malley by virtue of the provisions of the Workmen's Compensation Act [Ill.Rev.Stat.1959, c. 48, § 138.1 et seq.];
3. Republic is not entitled to recover from O'Malley on the basis of common law indemnity; and
4. That the trial court erred in directing a verdict in favor of Republic and against O'Malley in the event the jury found for the plaintiff.
To determine the issues in this case it is necessary to examine the facts as disclosed by the evidence. O'Malley was a painting contractor and plaintiff was employed by her as a painter. Republic entered into a contract with O'Malley to paint the structural steel and windows in its Chicago plant.
On the morning of March 4, 1956, plaintiff with other painters and his foreman, Chris Zannis, went to the Republic plant. Zannis had procured the use of the crane for painting the upper structure from one of Republic's superintendents. An electrician employed by Republic had placed the crane in the initial position, and switched off the power on the crane. The crane moved the full length of this bay of the building on steel rails fastened to the girders or roof trusses. It consisted of a trolley оn which was mounted a drum about 38 inches in diameter, and a control cab which hung down from the trolley on one side. The top of the drum was more than forty (40) feet from the floor. A cable was attached to the drum and when fastened to various products raised and lowered them when the drum revolved. The crane was used principally to move products about the Republic plant. It had also been used when necessary in the maintenance of the upper portion of the plant such as placing light fixtures, changing light bulbs, and painting. Zannis had used cranes in other plants and had moved this cranе several times on the day plaintiff was injured. After lunch the plaintiff and two other painters were on the trolley painting. Zannis was in the cab when someone called him to move the crane. He had the power on for the crane and the hoist, and hung out of the cab window to determine whether it was one of his men who called. He leaned out so far he almost fell, grabbed for support, and caught hold of the lever which started the drum to revolve. Plaintiff, who was standing on the drum, was thrown to the floor, and received the serious injuries for which he recovered the judgment.
Upon these essentiаl facts Republic and O'Malley first contend that the Act is not applicable for the reason that the crane was a permanent part of Republic's plant and was not a temporary structure erected and constructed for use in painting the building.
The Act reads in part:
"Structural Work"
"An Act providing for the protection and safety of persons in and about the construction, repairing, * * * and to provide for the enforcement thereof. [Ill.Rev.Stat., 1959, Ch. 48, § 60.]
"60. Scaffolds, cranes, ladders, etc. — Erection and construction.] * * * That all scaffolds, hoists, cranes, stays, ladders, supports, or other mechanical contrivances, erected or constructed by any person, firm or corporation in this State for the use in the erection, repairing, * * * or painting * * * building, * * * shall be erected and constructed, in a safe, suitable and proper manner, and shall be so erected and constructed, placed and operated as to give proper and adequate protection to the life and limb of any person or persons employed or engaged thereon, or passing under or by the same * * *.
"Scaffold, or staging, swung or suspended from an overhead support more than twenty (20) feet from the grоund or floor shall have, where practicable, a safety rail properly bolted, secured and braced, rising a [at] least thirty-four (34) inches above the floor. * * *"
"69.
* * * * * *
"For any injury to person or property, occasioned by any wilful violations of this act, or wilful failure to comply with any of its provisions, a right of action shall accrue to the party injured, for any direct damages sustained thereby; * * *"
The title of the Act clearly indicates that the legislature intended it for the protection and safety of workmen in erecting and repairing of buildings. The courts in Illinois have construed the Act liberally to accomplish that end. In Schultz v. Henry Ericsson Co., 1914,
"The object to be attained by this statute was to prevent injuries to persons employed in this dangerous and extra-hazardous occupation, so that negligence on their part in the manner of doing their work might not prove fatal. * * * No attempt is made to define what shall be considered or shall constitute a safe, suitable, and proper scaffold, which, from the very nature of things, could not wеll be done, for what might be a safe, suitable, and proper scaffold for one kind of work under one set of conditions or circumstances would be wholly inadequate, insufficient and unsafe for doing another kind of work under other conditions or circumstances and at a different height from the ground. Consequently the Legislature has not attempted to define what shall constitute a safe, suitable, and proper scaffold, but has cast the burden of constructing safe, suitable, and proper scaffolds upon the employer, and he cannot escape liability for injuries sustained by reason of his failing to furnish such scaffolds by pleading ignorance of their dangerous condition when the conditions are known to him."
and in
"`[W]illfully' is synonymous with `knowingly,' and to constitute a willful violation of the statute it is not necessary that there should have been `a reckless disregard' of its provisions. The employer is liable not only when the dangerous conditions are known to him, but also when by the exercise of reasonable care the existence of such dangerous conditions could have been discovered and become known to him." In Claffy v. Chicago Dock & Canal Co., 1911,
"[T]he obvious purpose of the act, as we have said, is to provide protection for workmen against injuries while engaged in constructing, repairing, altering, or removing buildings, and it is doing no violence to the rules of construction to hold that the act imposes the same obligation of protection against injuries from the same dangers in altering, repairing, or removing a building that is required in case of the construction of a building."
In Fetterman v. Production Steel Co. of Illinois, 1954,
"[The Act] deals with work that the General Assembly has regarded as particularly hazardous, and its purpose is to reduce the hazard to the fullest possible extent. To that end it has imposed a duty upon both the contractor and the owner."
Thus the Structural Work Act has been liberally construed to carry out the purpose of the Act as intended by the legislature.
With these principles of construction of the Act in mind we must determine whether the Scaffold Act is applicable to the facts and circumstances in this case. The crane was erected primarily to move products in Republic's plant. Since the crane was used as a scaffold when necessary in the maintenance of the upper structure of the plant it is a reasonable inference that the secondary purpose of its erection was for this use. The crane was not a permanent part of the building like the structural steel supports and roof trusses. It could be moved to reach various upper portions of the building and could be removed without damage to the building. It is argued by Republic and O'Malley that, if the crane in this case falls within the Scaffold Act, the Act would also include a window sill or a porch roof. While we are not presented with such facts neither the window sill nor the porch roof could be moved as a scaffold, and they certainly could not be removed without damage to the structure itself. In support of their position they rely upon March v. Hirshman, 1956,
Donohue v. George W. Stiles Construction Co., 1919,
The defendants, Republic and O'Malley, insist that the Illinois Act was patterned after the New York Act and consequently the decisions in courts of that state are persuasive here. The New York Act, Labor Law 1909, § 18, is similar in its language and its purpose to protect workmen in extra-hazardous employment. It uses the words "shall not furnish or erect or cause to be erected for the performance of such labor * * * scaffolding, etc. which are unsafe * * *." In Schultz v. Henry Ericsson Co., supra, the court in
"Neither do we think the statement of claim filed was insufficient to reasonably inform [defendant-contractor] of the nature of the case [it] was called upon to defend when it charged that [plaintiff-employee] was injured by reason of the failure to furnish him a proper, safe, and sufficient scaffold upon which to work. The charge is almost in the language of the statute, * * *.
"Whеther or not [plaintiff-employee] established a case of common law negligence against [defendant-contractor] is wholly immaterial, inasmuch as we are of the opinion that [plaintiff-employee] made a prima facie case, under the statute, for a failure to furnish and maintain a safe, suitable, and proper scaffold upon which he should work."
It is evident that the Illinois court in its liberal construction of the Act has considered "erected and constructed" as similar to "furnish or erect." O'Malley and Republic have cited the following New York cases to establish that the Scaffold Act is not applicable to the crane in the instant case. Broderick v. Cauldwell-Wingate Co.,
In Croce v. Buckley,
Republic's crane falls within the purview of the Act. We have been unable to find and counsel has failed to cite any Illinois case in which the facts are similar to the instant case. The crane had been literally "erected or constructed" and used for the repairing and painting of Republic's building. It was positioned temporarily just as any scaffold would be constructed or positioned temporarily to accomplish its purpose. The Act when liberally construed uses the words "erected and constructed" in the sense of being furnished. It was furnished and intended to be used, at the time plaintiff was injured, as a scaffold. The aim of the statute is to provide workmen with a safe place to work. To construe the Act as not applicable would be in complete opposition to the Illinois court's liberal construction of the Act to protect workmen in an extra hazardous occupation.
There is no merit to the contention that there was no proof that the defendant's violation of the Act was the proximate cause of plaintiff's injuries. The contention is answered in Kennerly v. Shell Oil Co., supra, 13 Ill.2d at pages 435 and 436,
"The Scaffold Act deals with highly dangerous activities. It has been regarded from the outset as intended to fix an independent, nondelegable duty of compliance upon the owner of the property and upon each contractor and subcontractor engaged in the work."
The injury was caused by Republic's "wilful violation" of the Act and Republic cannot escape liability regardless of the fault of O'Malley. Kennerly v. Shell Oil Co., supra. Cf. Schmid v. United States, 7 Cir., 1959,
Since the judgment against Republic must stand we must determine whether O'Malley is bound to indemnify Republic by virtue of the purchase order agreement. This agreement read in part as follows:
"Rules Governing Contracts and Their Employees"
"A — General
"All work * * * shall conform to the requirements of the law of the State. * * *"
"B — Insurance Coverage
"All outside contractors * * * shall be required to furnish evidence of proper insurance coverage * * * as required under paragraphs 13 and 14 of the purchase agreement as follows:
"13. The Seller [O'Malley] expressly assumes and agrees to indemnify the Buyer [Republic] against all liability of every kind for injury to persons, including wrongful death, or damage to property, occurring during and in consequence of the carrying on by the Seller of the work contemplated in this contract, where such injury or damage is due to the negligence of the Seller, his employees, subcontractors or agents. In the event Seller in the performance of the work called for by this contract, such machinery and/or equipment shall be considered as being under sole custody and control of the Seller during the period of such use by Seller, and should any person or persons in the employ of Buyer be used to operate said machinery and/or equipment during the period of such use, such person or persons shall be deemed during such period of operation to be an employee or employees of Seller."
"14. * * * shall procure at his own cost and keep in force, * * * insurance. * * *"
"C — Safety Rules Governing Contractors and Their Employees.
"The following `Safety Rules Governing Contractors and their Employees' are general plant rules with which your personnel should be thoroughly acquаinted. * * * Enforcement of these rules by his employees shall be completely contractor's responsibility."
Then follow the safety rules applicable to Republic's machinery, equipment and plant.
The plaintiff was injured while employed by O'Malley in the performance of the work provided for by the contract and over which she had exclusive control. O'Malley was permitted to use the crane. Republic's electrician positioned the crane and switched the power off. Zannis, O'Malley's foreman, was told not to move the crane. He had operated othеr cranes but had no experience in operating this crane. Zannis had switched on the power to move the crane and when he grabbed the lever the drum revolved and the plaintiff fell.
The question is whether the contract was sufficient under the circumstances to entitle Republic to indemnity. The contract was to be performed in Illinois, and must be construed in accordance with the Illinois law. In Griffith & Sons v. Fireproofing Co., 1923,
"Where the relation of two persons to the performance of work is such that both may be liable to a third person for an injury resulting from the work, there is no public policy which prohibits either from indemnifying the other against loss arising from positive acts of negligence by the indemnitor. Where one of them is only passively negligent but is exposed to liability through the positive acts and actual negligence of the other, the parties are not in equal fault as to each other though both are equally liable to the injured person."
In Westinghouse Co. v. La Salle Monroe Building Corp., 1947,
"hold * * * wholly harmless from any damages * * * arising out of any acts or omissions by the [Indemnitor.]"
At page 434 of
"[Indemnitee] insists that [Indemnitor] breached its covenant to provide insurance for [Indemnitee's] protection, therefore as a matter of law, [Indemnitee] cannot impose upon [Indemnitor] a loss, which, but for such breach, would have been borne by an insurance carrier.
"To adopt this construction of the contract would impose on the contractor the duty to indemnify against injuries entirely without his control, аnd such should not be adopted in the absence of clear language in the contract including injuries arising from the negligence of [Indemnitee's] own servants."
In George Sollitt Const. Co. v. Gateway Erectors, Inc., 7 Cir., 1958,
"It seems clear that the injury to Campbell arose in connection with the `contractor's operations.' As defendant argues, the contract includes all accidents `resulting from or arising in connection with any of contractor's operations'; that `the indemnifying agreement is expressed in сlear and explicit language and the intention of the parties is indicated in unequivocal terms.' There is also force in the contention of defendant `that negligence of either party does not enter into the case, because the injury to the employee [Campbell] resulted from or arose in connection with one of the contractor's operations against which he agreed to hold defendant harmless.'"
In Northern States Co. Inc. v. A. Finkl & Sons Co., 1956,
"In the Sollitt and Northern States cases, supra, the owners negligently created the conditions, and their agents committed the acts of negligence resulting in damages for which they sought indemnity. The Russell case, supra, involved the question of whether the accident for which damages and indemnity were claimed could have been considered as resulting from or arising in connection with any of the indemnitors' operations. For the reasons hereinbefore given, we think thе G. M. & O. was entitled to indemnification under the contract, even though there was no express provision to that effect."
It must be concluded from the foregoing cases that indemnity contracts are not against public policy and that it is decisive to determine in each case whether or not the damages were incurred in the operations contemplated by Indemnitor's contract, and under conditions controlled by the Indemnitor. Under such circumstances the Illinois courts are prone to construe the indemnity contract broad enough in its scope to unequivocally includе the liability which the Indemnitee incurred.
In the instant case the plaintiff was injured while in the employ of O'Malley during and in consequence of carrying on O'Malley's work which was contemplated by the contract. The equipment used by O'Malley was by the contract to be considered within the "sole custody and control of [O'Malley] during the period of such use by Seller." Any employees of Republic who operated the equipment were by the contract deemed to be employees of O'Malley. Even if Republic's employee failed to place a lock on the switch which cut off thе power, his negligence, if any, under the contract, was the negligence of O'Malley.
In adopting this construction of the contract we do not impose on O'Malley a duty to indemnify against injuries entirely without her control. The language of the contract is sufficient to unequivocally express the intention of the parties that under the circumstances Republic should be indemnified by O'Malley.
There is no validity in O'Malley's contention that she could not be liable for injuries to the plaintiff because she was completely discharged by the Workmen's Compensation Act. The same contention was mаde in the Moroni case and we agree with Mr. Justice Schwartz wherein he held, under facts similar to the instant case, that the Workmen's Compensation Act did not abolish the right of a third-party to be indemnified by a contract.
Since we have held Republic can recover on O'Malley's indemnity contract it is not necessary to prolong this opinion by commenting on the common law right of Republic to be indemnified by O'Malley.
O'Malley finally contends that the trial court erred in directing the jury, in the event it returned a verdict in favor of Bounougias to return a verdict in favor of Republic, and against O'Malley in a like amount. There was no conflict in the evidence. All reasonable men in a fair and impartial exercise of their judgment must agree that under the circumstances when Zannis leaned out of the window with the current connected to the crane, and especially to the hoist, he was negligent. It was this negligence which proximately caused the occurrence and the injuries to the plaintiff. No other reasonable inference is justified. There was no issue of fact to be determined by the jury and the district court properly instructed the jury.
For the reasons stated the judgment of the district cоurt is
Affirmed.
CASTLE, Circuit Judge (dissenting).
I would reverse. Plaintiff predicates liability not on negligence of Republic in permitting O'Malley's employees to use the trolley of the crane as a place to stand while cleaning and painting the ceilings and beams but solely upon a breach of the provisions of the Illinois Structural Work Act. Ill.Rev.Stats., Ch. 48, § 60 et seq.
It is my opinion that the facts established by the record do not permit application of the Illinois statute. The purpose of the crane and its trolley was not to afford a place for painters or workmen to stand while painting or doing repair work. Its purposе along with the 95 other such cranes in the building was for moving materials in process in the plant. O'Malley found the trolley of the crane a convenient place for the painters, including plaintiff, to stand while performing the work. Republic permitted the trolley to be so used. Other painters and repairmen had worked from the trolley. But neither the crane nor its trolley was a scaffold, hoist, crane, stay, ladder, support or other mechanical contrivance which, in the language of the statute, was "erected or constructed * * * for the use in the erection, repairing, alteratiоn, removal or painting of any house, building, bridge, viaduct, or other structure". The crane and trolley were part of the plant's operating machinery and equipment. It was not a device for use in the erection, repair, alteration, removal or painting of the structure. Nor, on the facts here involved, was the trolley a make-shift or substitute scaffold. It did eliminate the use of a scaffold but only because the parties found it a convenient place from which to do the work. That the statute is to be liberally construed does not in my opinion afford a basis for extending its scope to embrace the factual situation here involved.