{
  "id": 11435415,
  "name": "BRIDGESTONE/FIRESTONE, INC., Plaintiff v. OGDEN PLANT MAINTENANCE COMPANY OF NORTH CAROLINA and THE BUDD GROUP, INC., Defendants",
  "name_abbreviation": "Bridgestone/Firestone, Inc. v. Ogden Plant Maintenance Co. of North Carolina",
  "decision_date": "2001-07-03",
  "docket_number": "No. COA00-400",
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    "judges": [
      "Judge HUNTER concurs.",
      "Judge CAMPBELL concurs in part and dissents in part."
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    "parties": [
      "BRIDGESTONE/FIRESTONE, INC., Plaintiff v. OGDEN PLANT MAINTENANCE COMPANY OF NORTH CAROLINA and THE BUDD GROUP, INC., Defendants"
    ],
    "opinions": [
      {
        "text": "WALKER, Judge.\nThis appeal involves plaintiffs claim for indemnity from defendants arising out of an industrial accident which resulted in the deaths of two individuals. The accident occurred on 9 September 1994 at a tire manufacturing facility, owned by Bridgestone/Firestone, Inc. (plaintiff), in Wilson County, North Carolina.\nPlaintiff contracted with Ogden Plant Maintenance Company of North Carolina (defendant Ogden) to maintain the plant and operate its powerhouse, which generated energy for the plant\u2019s manufacturing process and included two large fuel storage tanks (tanks). Plaintiff also contracted with Budd Services, Inc. (defendant Budd) to provide security for the plant and to issue \u201chot work\u201d permits which allowed jobs to be performed by independent contractors who engage in welding or other types of \u201chot work\u201d at the plant. The contracts between plaintiff and each defendant included a provision obligating each defendant to indemnify plaintiff from any and all losses suffered by plaintiff arising out of defendants\u2019 respective acts of negligence at the plant.\nPrior to 9 September 1994, defendant Ogden determined that two of the tanks needed measuring devices. Defendant Ogden then requisitioned plaintiff for the parts and labor for this job, which included the services of an off-facility independent contractor, A. B. Electric Services, Inc. (ABES), that defendant Ogden had selected. Plaintiff agreed to supply the parts and contracted with ABES to perform the installation of the measuring devices.\nOn 9 September 1994, ABES arrived at the plant to install the measuring devices. ABES first determined that pipes would need to be attached to the top of each tank to house the measuring devices and therefore requested defendant Budd to issue a \u201chot-work\u201d permit for the welding necessary to attach the pipes. After defendant Budd issued the permit, ABES employees proceeded with their welding work on top of one of the tanks. During this task, the tank exploded from the heat generated by the welding and resulted in the deaths of both employees as well as the destruction of the tank.\nThe estates of the deceased welders filed wrongful death suits alleging negligence and gross negligence by plaintiff, defendant Ogden and defendant Budd. Plaintiffs motion for summary judgment was denied. Defendants Ogden and Budd then settled the claims prior to trial and plaintiff settled the claims against it during trial. Plaintiff subsequently filed this action seeking indemnity and/or contribution from defendants for its costs and sums paid to settle the underlying claims. Plaintiff also sought the costs of repair to its property destroyed during the accident. From the trial court\u2019s granting of defendants\u2019 motions for judgment on the pleadings, plaintiff appeals.\nIn its assignments of error, plaintiff argues the trial court erred in granting defendants\u2019 motions for judgment on the pleadings. Plaintiff contends it is entitled to be indemnified for its costs and sums paid to settle the claims and for its property damage pursuant to indemnity provisions in the contracts with defendants because the accident did not arise from plaintiff\u2019s negligence but from the negligence of defendants.\nAt the outset, we note that when a trial court considers a motion for judgment on the pleadings pursuant to Rule 12(c) of our Rules of Civil Procedure, all allegations in the non-movant\u2019s pleadings are deemed admitted. Ragsdale v. Kennedy, 286 N.C. 130, 137, 209 S.E.2d 494, 499 (1974) (citations omitted); N.C.R. Civ. P. 12(c) (1999). The motion is granted when the movant, held to a strict standard, shows that \u201cno material issue of [fact] exists and that he is clearly entitled to judgment.\u201d Ragsdale, 286 N.C. at 137, 209 S.E.2d at 499, citing Southern Ohio Bank v. Merrill Lynch, Pierce, Fenner and Smith, Inc., 479 F.2d 478 (6th Cir. 1973). The purpose of the motion is to dispose of baseless claims and to ensure that a party is not precluded from a full and fair hearing on the merits. Id.\nContractual indemnity provisions in this State are controlled by N.C. Gen. Stat. \u00a7 22B-1 (1999), which provides:\nAny promise or agreement in, or in connection with, a contract or agreement relative to the design, planning, construction, alteration, repair or maintenance of a building, structure, highway, road, appurtenance or appliance. . . purporting to indemnify or hold harmless the promisee, the promisee\u2019s independent contractors, agents, employees, or indemnitees against liability for damages arising out of bodily injury to persons or damage to property proximately caused by or resulting from the negligence, in whole or in part, of the promisee, its independent contractors, agents, employees, or indemnitees, is against public policy and is void and unenforceable. Nothing contained in this section shall prevent or prohibit a contract, promise or agreement whereby a promisor shall indemnify or hold harmless any promisee or the promisee\u2019s independent contractors, agents, employees or indemnitees against liability for damages resulting from the sole negligence of the promisor, its agents or employees....\n(emphasis added). In other words, a construction indemnity agreement may purport to indemnify a promisee from damages arising from negligence of the promisor, but any provision seeking to indemnify the promisee from its own negligence is void. \u201cThe indemnity provisions to which G.S. \u00a7 22B-1 apply are those construction indemnity provisions which attempt to hold one party responsible for the negligence of another.\u201d International Paper Co. v. Corporex Constructors, Inc., 96 N.C. App. 312, 315, 385 S.E.2d 553, 555 (1989) (holding that where contract provision which violated N.C. Gen. Stat. \u00a7 22B-1 was not a central feature of the contract, the illegal provision was severable from the otherwise valid indemnity contract).\nIn the instant case, the indemnity provision in the contract between plaintiff and defendant Ogden is as follows in pertinent part:\nExcept as provided in Article XIII of this contract, [defendant Ogden] shall indemnify [plaintiff] and save it harmless from damage to or theft of [plaintiffs] property and from all claims and judgments for injury or death to persons or property damage (including costs of [litigation] and attorney\u2019s fees) made or obtained against [plaintiff] by third persons including [plaintiffs] and [defendant Ogden\u2019s] employees and agents, based on injuries to person or property, in any manner caused by, incident to, connected with, resulting or arising from the performance of this contract or the presence of [defendant Ogden\u2019s] employees, and/or agents on [plaintiff\u2019s] premises, regardless of whether such claims are alleged to be caused by negligence, or otherwise, on the part of [plaintiff] or its employees, excepting however, injury to or death of employees of [defendant Ogden], from any cause whatsoever.\nBy this provision, plaintiff seeks indemnity for costs and sums paid as a result of defendant Ogden\u2019s negligence. Plaintiff is therefore not attempting \u201cto hold [defendant Ogden] responsible for the negligence of [plaintiff].\u201d Id. This indemnity provision does not violate N.C. Gen. Stat. \u00a7 22(b)(1).\nThe indemnity provision in the contract between plaintiff and defendant Budd contains the following language:\n[Defendant Budd] will further indemnify and hold [plaintiff] harmless from and against any and all liabilities, claims, demands, suits, losses, damages, costs, attorney\u2019s fees and expenses for bodily injury to, or death of any person, or damage to or destruction of any property, caused by any negligent or intentional act or omission on the part of [defendant Budd], its officers, employees or former employees. Except [plaintiff] shall not be held harmless for any such liabilities, claims, demands, suits, losses, damages, costs, attorney\u2019s fees and expenses caused by any negligent or intentional act or omission on the part of [plaintiff], its officers, employees or agents.\nLikewise, this indemnity provision purports to hold defendant Budd responsible for its own negligent acts but not the negligent acts of plaintiff.\nIn this State, \u201ca principal generally is liable for the negligent acts of his agent which result in injury to another.\u201d Willoughby v. Wilkins, 65 N.C. App. 626, 633, 310 S.E.2d 90, 95 (1983), citing King v. Motley, 233 N.C. 42, 62 S.E.2d 540 (1950). \u201cGenerally, there is no vicarious liability upon an employer for negligent acts of an independent contractor.\u201d Id., citing Hendricks v. Leslie Fay, Inc., 273 N.C. 59, 159 S.E.2d 362 (1968). But see Woodson v. Rowland, 329 N.C. 330, 407 S.E.2d 222 (1991) (which stated general rule that one who employs an independent contractor is not liable for the independent contractor\u2019s negligence but recognized exceptions when: (1) the employer retains the right to control the manner in which the contractor performs his work; and (2) the independent contractor is employed to perform an inherently dangerous activity, because the employer has a continuing responsibility to ensure that adequate safety precautions are taken, which responsibility cannot be delegated to the independent contractor).\nAs to the question of when an issue of indemnity should be submitted to the jury, this Court has held:\nThe right to indemnity between defendants arises when liability is imposed upon one defendant for the other\u2019s tortious conduct through operation of law, as for example, through the doctrine of respondeat superior. Indemnity is not permitted when the defendants are in pari delicto, that is, when both defendants breach substantially equal duties owed to the plaintiff. In order to recover indemnity from a second defendant, the first defendant must allege and prove (1) that the second defendant is liable to the plaintiff and (2) that the first defendant\u2019s liability to the plaintiff is derivative, that is, based upon the tortious conduct of the second defendant.\nKim v. Professional Business Brokers, 74 N.C. App. 48, 51, 328 S.E.2d 296, 299 (1985) (citations omitted) (holding trial court did not err in failing to submit issue of indemnity to jury where multiple defendants were in pari delicto and thus not derivatively liable); See also Anderson v. Robinson, 275 N.C. 132, 165 S.E.2d 502 (1969).\nIn its complaint, plaintiff alleges that the accident occurred solely as a result of defendants\u2019 negligence. Plaintiff further alleges that if it were in any way liable, it could only be on the \u201cbasis of some passive or derivative fault,\u201d and thus would be entitled to indemnification. To support this assertion, the complaint also alleges that plaintiff was not involved in the discussion which took place between defendants and ABES regarding the installation job and that plaintiff \u201cwas not notified of [the welding] activity and had no personnel present.\u201d In their answer, defendants admit discussing the installation job among each other and with ABES, and that plaintiff\u2019s personnel were not present during the activity. However, defendants deny that plaintiff was not notified of the activity. Defendants also admit the \u201chot work\u201d permit to perform the welding was issued without notice to plaintiff but deny the allegation that plaintiff was not included in the coordination of the activity.\nDefendants contend plaintiff settled claims of direct and active negligence against it in the underlying action and therefore is not entitled to indemnification. Defendants further contend that because plaintiff has settled claims of direct and active negligence, it cannot recover either under common law or contractual indemnity.\nIn examining the record before us, there is no admission, finding or adjudication of negligence on the part of plaintiff in the underlying action. All that appears is that plaintiff, for whatever reasons, paid sums to settle the underlying claims.\nDefendants cite City of Wilmington v. Natural Gas Corp., 117 N.C. App. 244, 450 S.E.2d 572 (1994), for the proposition that where a party voluntarily pays a claim for which it is not liable, that party is not entitled to indemnity. In that case, the City was required to pay a certain amount of workers\u2019 compensation benefits to an individual pursuant to a city ordinance, which also provided that any additional amount paid was within the City\u2019s discretion. Id. at 250, 450 S.E.2d at 577. Because the City paid additional amounts for which it \u201cwas not legally obligated to pay[,]\u201d this Court found its \u201cactions were voluntary\u201d and thus it was not entitled to be indemnified. Id.\nWe distinguish this case from City of Wilmington. Plaintiff\u2019s settlement in the underlying action came after Ogden and Budd had settled and plaintiff asserts it was faced with the prospect of costly and protracted litigation as the only remaining defendant in that action. We cannot conclude as a matter of law that plaintiff\u2019s settlement payment was voluntary. See Griffin v. Van Norman, 302 S.C. 520, 397 S.E.2d 378 (1990); Valloric v. Dravo Corp., 178 W. Va. 14, 357 S.E.2d 207 (1987).\nDefendant Ogden contends N.C. Gen. Stat. \u00a7 IB-4 (1999) bars plaintiff from seeking contribution. Contribution, as opposed to indemnity, \u201carises when more than one tortfeasor is found liable for the plaintiff\u2019s injury. It allows a defendant to demand assistance from the other joint tortfeasor(s) if his payment to the plaintiff exceeds his pro rata share. Contribution also allows the defendant to apply any damages it pays as a joint tortfeasor as a credit against the total damage award.\u201d David A. Logan and Wayne A. Logan, North Carolina Torts \u00a7 8.20, at \u00b6 7 (1996), citing Holland v. Southern Pub. Util. Co., 208 N.C. 289, 180 S.E. 592 (1935).\nOn the other hand, as previously noted, indemnity arises under the doctrine of primary-secondary liability, also known as active-passive negligence. Here, plaintiff is seeking indemnification, as opposed to contribution, on the basis that it is not a joint nor primary tortfeasor.\nWe conclude plaintiff\u2019s allegations, together with the contractual indemnity provisions, are sufficient to withstand defendants\u2019 motion for judgment on the pleadings. We therefore reverse the trial court\u2019s order and remand the case for a determination of whether plaintiff is entitled to indemnity from defendants Ogden and Budd.\nReversed and remanded.\nJudge HUNTER concurs.\nJudge CAMPBELL concurs in part and dissents in part.",
        "type": "majority",
        "author": "WALKER, Judge."
      },
      {
        "text": "CAMPBELL, Judge,\nconcurring in part and dissenting in part.\nI concur with the majority opinion to the extent that it allows plaintiff to proceed on its claim against defendants for the property damage plaintiff allegedly incurred as a result of the 9 September 1994 accident. I respectfully dissent from the majority opinion\u2019s conclusion that plaintiff should be allowed to proceed on its claim seeking indemnity from defendants for the costs incurred by plaintiff in defending and settling the underlying wrongful death action. Therefore, the trial court\u2019s order should be affirmed in part and reversed in part.\n\u201cThe right to indemnity between defendants arises when liability is imposed upon one defendant for the other\u2019s tortious conduct through operation of law, as for example, through the doctrine of respondeat superior.\u201d Kim v. Professional Business Brokers, 74 N.C. App. 48, 51, 328 S.E.2d 296, 299 (1985). \u201cIndemnity is not permitted when the defendants are in pari delicto, that is, when both defendants breach substantially equal duties owed to the plaintiff.\u201d Id. In the instant case, plaintiff seeks indemnification from defendants for the expenses it incurred in defending and settling the underlying wrongful death action brought against the parties. Upon examination of the complaint in the underlying wrongful death action, which defendants attached as an exhibit to their respective answers,1 find that the only allegations asserted against plaintiff are allegations of direct and active negligence. Although plaintiffs complaint in the instant case alleged that plaintiffs liability in the underlying action could only be based on passive or derivative negligence, there are no allegations of passive or derivative negligence on the part of plaintiff in the underlying wrongful death suit. Having settled an action based on a complaint alleging direct and active negligence on its part, plaintiff would be prohibited from seeking indemnification from defendants for the costs incurred in such settlement. I believe a contrary ruling would violate this State\u2019s public policy against allowing an entity to be indemnified for loss arising from its own negligence, as codified in N.C. Gen. Stat. \u00a7 22B-1.\nFurther, as to defendant-Ogden, plaintiffs contractual indemnification claim is itself violative of N.C.G.S. \u00a7 22B-1. Pursuant to N.C.G.S. \u00a7 22B-1, a construction indemnity provision which purports to indemnify a promisee against liability for damages arising from the negligence, in whole or in part, of the promisee \u201cis against public policy and is void and unenforceable.\u201d N.C. Gen. Stat. \u00a7 22B-1 (1999). In the instant case, the indemnity provision in the contract between plaintiff and defendant-Ogden clearly purports to indemnify plaintiff against damages arising from its own negligence. By its terms, the indemnity provision provides that defendant-Ogden shall indemnify plaintiff \u201cfrom damage to or theft of [plaintiffs] property and from all claims and judgments . . . based on injuries to person or property . . . regardless of whether such claims are alleged to be caused by negligence, or otherwise, on the part of [plaintiff] or its employees . . . .\u201d This provision clearly attempts to hold defendant-Ogden responsible for the negligence of plaintiff. It is therefore against public policy and is void and unenforceable.\nHowever, this does not end the inquiry as to the indemnity provision between plaintiff and defendant-Ogden. \u201cWhen a contract contains a provision which is severable from an illegal provision and is in no way dependent upon the enforcement of the illegal provision for its validity, such a provision may be enforced.\u201d International Paper Co. v. Corporex Instructors, Inc., 96 N.C. App. 312, 315, 385 S.E.2d 553, 555 (1989). The majority opinion does not specifically address the issue of severability, but having carefully reviewed the indemnity provision at issue and applicable case law, I do not believe that the indemnity provision between plaintiff and defendant-Ogden can be severed so as to make it valid under N.C.G.S. \u00a7 22B-1.\nEven if the offending phrase, \u201cregardless of whether such claims are alleged to be caused by negligence, or otherwise, on the part of [plaintiff] or its employees,\u201d were to be stricken, the remaining indemnity provision would still allow plaintiff to seek indemnity from defendant \u201cfrom all claims and judgments ... based on injuries to person or property ... in any manner caused by, incident to, connected with, resulting or arising from the performance of this contract,.. ..\u201d The remaining indemnity provision would not by its terms prevent plaintiff from seeking indemnification from loss arising from the performance of the contract and caused, in whole or in part, by plaintiffs own negligence. Therefore, it would still violate public policy and be void and unenforceable.\nIn Miller Brewing Co. v. Morgan Mechanical Contractors, Inc., 90 N.C. App. 310, 368 S.E.2d 438, disc. review denied, 323 N.C. 174, 373 S.E.2d 110 (1988), this Court considered an appeal from a trial court order holding that the indemnity provision printed on the back of a purchase order was against public policy, void and unenforceable under N.C.G.S. 22B-1. The indemnity provision at issue in Miller, read:\n9. Seller is to save harmless and indemnify Buyer from any and all judgments, costs, expenses, attorneys\u2019 fees, and claims . . . arising out of or in any way connected with the work done or goods furnished under this [purchase order]. . . .\nAs in the instant case, the indemnity provision in Miller did not in any way prohibit the party seeking indemnity from recovering for loss caused by its own negligence. In Miller, this Court held that the indemnity provision at issue was invalid under N.C.G.S. 22B-1. I believe that the indemnity provision at issue in the instant case is sufficiently similar to the one in Miller to make this Court\u2019s holding in Miller controlling.\nFurther, the majority\u2019s reliance on International Paper Co. does not change my opinion. In International Paper Co., this Court severed from an indemnity provision a phrase similar to the offending phrase in the instant case. Having done so, the remainder of the indemnity provision was found not to be violative of N.C.G.S. \u00a7 22B-1. However, unlike the remaining indemnity provision here, the remaining indemnity provision in International Paper Co. only allowed for indemnification for loss \u201ccaused in whole or in part by any negligent act or omission of the Builder, any Subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable.\u201d This provision would not allow plaintiff to seek indemnification for loss caused by its own negligence.\nHaving found this Court\u2019s conclusion in Miller to be controlling, I believe the indemnity provision between plaintiff and defendant-Ogden is void and unenforceable under N.C.G.S. \u00a7 22B-1, and cannot be used as the basis for recovery in an indemnity action. Consequently, plaintiffs contractual indemnification claim against defendant-Ogden has no legal basis, and the trial court did not err in entering judgment on the pleadings in favor of defendant-Ogden as to that portion of plaintiffs claim.\nI do not find that the indemnification provision between plaintiff and defendant-Budd violates N.C.G.S. \u00a7 22B-1. It does not purport to indemnify plaintiff against liability arising from its own negligence. Nevertheless, for the reasons previously stated, I believe the trial court\u2019s judgment on the pleadings in favor of defendant-Budd as to plaintiffs contractual indemnification claim was correct.\nAs to plaintiff\u2019s property damage claim, I concur in reversing the trial court\u2019s order, and remanding for further proceedings to determine if defendants are liable to plaintiff for the property damage incurred on 9 September 1994. On remand, one of the factual issues to be resolved would be whether the damage to plaintiff\u2019s property and equipment was covered by the \u201cFire and Extended Coverage and Boiler and Machinery Insurance Policies filed and approved in New York State\u201d at the time of the accident, thereby leading to plaintiff\u2019s waiver of its right to recover from defendant-Ogden pursuant to Article XIII of their contract.\n. When ruling on a motion for judgment on the pleadings the trial judge is allowed to consider any exhibits which have been attached to the pleadings. See Minor v. Minor, 70 N.C. App. 76, 318 S.E.2d 865, cert. denied, 312 N.C. 495, 322 S.E.2d 558 (1984).",
        "type": "concurring-in-part-and-dissenting-in-part",
        "author": "CAMPBELL, Judge,"
      }
    ],
    "attorneys": [
      "Young Moore & Henderson, P.A., by David M. Duke; and Womble Carlyle Sandridge & Rice, RL.L.C., by Jerry S. Avis and G. Christopher Olson, for plaintiff-appellant.",
      "Ragsdale Liggett PLLC, by George R. Ragsdale and Walter L. Tippett, Jr., for defendant-appellee Ogden Plant Maintenance Company of North Carolina.",
      "Yates, McLamb & Weyher, L.L.P., by Rodney E. Pettey, for defendant-appellee The Budd Group, Inc."
    ],
    "corrections": "",
    "head_matter": "BRIDGESTONE/FIRESTONE, INC., Plaintiff v. OGDEN PLANT MAINTENANCE COMPANY OF NORTH CAROLINA and THE BUDD GROUP, INC., Defendants\nNo. COA00-400\n(Filed 3 July 2001)\nIndemnity\u2014 contractual \u2014 industrial accident \u2014 motion for judgment on the pleadings\nThe trial court erred by granting defendants\u2019 motion for judgment on the pleadings in plaintiff\u2019s contractual claim for indemnity from defendants under N.C.G.S. \u00a7 22B-1 arising out of an industrial accident resulting in the death of two individuals and destruction of property during the accident, because: (1) plaintiff is seeking indemnity for costs and sums paid as a result of defendants\u2019 negligence, and plaintiff is not attempting to hold defendants responsible for the negligence of plaintiff; (2) there is no admission, finding, or adjudication of negligence on the part of plaintiff in the underlying action; and (3) plaintiffs settlement payment was not voluntary as a matter of law when defendants already settled and plaintiff faced the prospect of costly and protracted litigation as the only remaining defendant in that action.\nJudge Campbell concurring in part and dissenting in part.\nAppeal by plaintiff from judgment dated 12 February 2000 by Judge W. Russell Duke in Wilson County Superior Court. Heard in the Court of Appeals 5 February 2001.\nYoung Moore & Henderson, P.A., by David M. Duke; and Womble Carlyle Sandridge & Rice, RL.L.C., by Jerry S. Avis and G. Christopher Olson, for plaintiff-appellant.\nRagsdale Liggett PLLC, by George R. Ragsdale and Walter L. Tippett, Jr., for defendant-appellee Ogden Plant Maintenance Company of North Carolina.\nYates, McLamb & Weyher, L.L.P., by Rodney E. Pettey, for defendant-appellee The Budd Group, Inc."
  },
  "file_name": "0503-01",
  "first_page_order": 531,
  "last_page_order": 541
}
