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  "name": "SOUTHERN RAILWAY COMPANY, a Corporation v. ADM MILLING COMPANY, a Corporation",
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      "SOUTHERN RAILWAY COMPANY, a Corporation v. ADM MILLING COMPANY, a Corporation"
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      {
        "text": "WHICHARD, Judge.\nPlaintiff instituted this action to collect from defendant $52,987.53 which plaintiff had paid to its employee who was injured while working on a spur track serving defendant\u2019s Mecklen-burg County plant. The basis of the action was an indemnity provision of contracts in which plaintiff and defendant\u2019s predecessor in title agreed on the terms and conditions for the location and operation of the spur track on which the employee was injured.\nThe trial court granted defendant\u2019s motion for summary judgment. Plaintiff appealed, raising as issues (1) whether the court correctly interpreted the indemnity agreement, and (2) whether it properly withheld from the jury the question of defendant\u2019s negligence.\nWe find that summary judgment was improperly entered, and accordingly reverse.\nI.\nPlaintiff and Interstate Milling Company (Interstate) entered a contract under which plaintiff agreed to relocate, reconstruct, and operate two industrial railroad tracks (spur tracks) to serve Interstate. Interstate agreed, among other things, to the following indemnity clause:\n5. That it [Interstate] will indemnify and save harmless the Railroad [plaintiff] against any and all damage resulting from negligence of the party of the second part [Interstate], its servants and employees, in and about said industrial tracks and the right of way therefor ....\nSubsequently the parties entered a second contract in which plaintiff agreed to construct and operate an extension to one of the two spur tracks. The second contract contained an indemnity clause identical to that in the first except that it related to the spur track extension.\nInterstate thereafter deeded to defendant the property on which the spur tracks were located. It also transferred to defendant the business it had operated. Defendant continued operation of the business under the name Interstate Milling Company, a subsidiary of ADM Milling Company. Plaintiff alleged that defendant succeeded to the benefits of the spur track contracts; and that by contract, express or implied, or by operation of law, it assumed the obligations set forth in those contracts.\nLloyd L. Whitson, an employee of plaintiff, was injured on defendant\u2019s spur tracks while switching railroad cars. Plaintiff paid Whitson\u2019s medical and hospital expenses and made a compromise settlement of its potential liability to him under the Federal Employers\u2019 Liability Act, 45 U.S.C. \u00a7 51, et seq. While negotiating the settlement, plaintiff sought from defendant indemnification pursuant to the indemnity clauses of the two contracts. Defendant refused to extend any authority to plaintiffs agents in the negotiations and to consent to any reimbursement.\nAfter settlement with Whitson plaintiff instituted this action against defendant for indemnification under the terms of the contracts. Defendant answered, denying its negligence; denying that its negligence, if any, was the proximate cause of Whitson\u2019s injuries; and asserting the affirmative defense of contributory negligence. After extensive discovery, defendant\u2019s motion for summary judgment was granted.\nPlaintiff appealed.\nII.\nThe purpose of summary judgment under G.S. 1A-1, Rule 56, is to bring litigation to an early decision on the merits, without the delay and expense of trial, where it can be readily shown that no material facts are in issue. Kessing v. Mortgage Corp., 278 N.C. 523, 534, 180 S.E. 2d 823, 830 (1971). Judgment shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue of material fact and that one of the parties is entitled to judgment as a matter of law. Id. See also Treadway v. Railroad Co., 53 N.C. App. 759, 762-63, 281 S.E. 2d 707, 710 (1981). The court here determined, pursuant to this standard, that only a question of law on undisputed facts was in controversy; and that the question could be resolved without \u201cthe delay and expense of a trial.\u201d Id. at 533, 180 S.E. 2d at 829.\nIII.\nPlaintiff first argues that the intent of the parties to the contracts was that defendant would indemnify plaintiff against liabilities under the Federal Employers\u2019 Liability Act (FELA), and that the question of defendant\u2019s negligence under FELA standards thus should have been submitted to the jury. Under the FELA, a common carrier, including a railroad, is liable to its employees for injury or death resulting in whole or in part from the negligence of its officers, agents, or employees, or \u201cby reason of any defect or insufficiency, due to its negligence, in its cars, engines . . . , track, [or] roadbed.\u201d 45 U.S.C. \u00a7 51. What constitutes negligence under the FELA is a federal question. Urie v. Thompson, 337 U.S. 163, 174, 69 S.Ct. 1018, 1027, 93 L.Ed. 1282, 1295 (1949); see also Treadway, 53 N.C. App. at 760, 281 S.E. 2d at 709. The United States Supreme Court has defined negligence as \u201cthe lack of due care under the circumstances; or the failure to do what a reasonable and prudent man would ordinarily have done under the circumstances of the situation; or doing what such a person under the existing circumstances would not have done.\u201d Tiller v. Atlantic Coast Line R. Co., 318 U.S. 54, 67, 63 S.Ct. 444, 451, 87 L.Ed. 610, 617 (1943). Although contributory negligence by an employee may diminish his damages in proportion to his negligence, it is not a defense to the action. 45 U.S.C. \u00a7 53. Further, the carrier-employer is barred from defending on the basis of assumption of risk. 45 U.S.C. \u00a7 54. The burden of establishing liability for negligence thus is considerably less imposing under the FELA than under the common law of North Carolina.\nThe sections of the parties\u2019 contracts which pertain to indemnification control whether defendant\u2019s potential liability is to be judged by FELA standards. A contract of indemnity should be construed to cover all losses, damages, or liabilities which reasonably appear to have been within the contemplation of the parties. 42 C.J.S., Indemnity, \u00a7 12(a), p. 579. The intent of the parties to the contract is to be ascertained from the language used, the subject matter, the end in view, the purpose sought, and the situation of the parties at the time. Lane v. Scarborough, 284 N.C. 407, 410, 200 S.E. 2d 622, 624 (1973).\nThe contracts here do not specifically refer to the FELA. Such omission, however, has not been determinative in similar cases in other jurisdictions. In Chicago, R.I. & P.R. Co. v. Dobry Flour Mills, 211 F. 2d 785 (10th Cir.), cert. denied, 348 U.S. 832, 75 S.Ct. 55, 99 L.Ed. 656 (1954), e.g., the relevant contract clause stated that the defendant agreed \u201cto indemnify and hold harmless the Trustees for loss, damage or injury from any act or omission of the [defendant], its employees or agents.\u201d (Emphasis supplied.) The court construed \u201cact or omission\u201d to allow a determination of liability based upon the law making plaintiff liable to its injured employee, viz., the FELA, rather than upon defendant\u2019s common law liability. Similarly, in Steed v. Central of Georgia Ry. Co., 529 F. 2d 833 (5th Cir.), cert. denied, 429 U.S. 966, 97 S.Ct. 396, 50 L.Ed. 2d 334 (1976), the phrase \u201cact or omission\u201d in an indemnity clause was interpreted to mean liability for the indemnitor under the law which would make the railroad liable to its injured employee, again the FELA. Finally, in Georgia Ports Auth. v. Cent. of Georgia Ry., 135 Ga. App. 859, 219 S.E. 2d 467 (1975), the court held that the phrase \u201cnegligence or other causes\u201d in the indemnity clause of a contract included any of the indemnitor\u2019s wrongful or negligent acts which would impose liability upon the railroad under FELA standards as well as under common law negligence standards. The court noted that it was not necessary for the indemnity clause to refer expressly to the FELA because \u201c[t]he parties to such an agreement are held to have known of the existence of the federal statute at the time they executed their agreement.\u201d Id. at 862, 219 S.E. 2d at 470.\nIn Beachboard v. Railway Co., 16 N.C. App. 671, 193 S.E. 2d 577 (1972), cert. denied, 283 N.C. 106, 194 S.E. 2d 633 (1973), this Court reviewed an indemnity agreement identical to those here. Plaintiff there, an employee of Southern Railway Company, sued Southern for damages from injuries sustained while he was working on a side track owned by the third-party defendant, Champion Papers, Inc. Employees of Champion shoved five railroad cars onto the track where plaintiff was working. Those cars hit two cars on which plaintiff was opening the knuckles. Plaintiff was dragged beneath these cars, and the wheels severed his legs. The jury found Champion negligent; and Champion appealed, contending, inter alia, that the court should have submitted to the jury the issue of plaintiffs contributory negligence. In rejecting this contention, this Court, per Judge Parker, stated:\nSouthern\u2019s third-party action against Champion was not predicated upon Champion\u2019s liability to plaintiff under the general law of torts, under which plaintiffs contributory negligence would have been a defense, but upon the indemnity contract under which Champion became obligated to indemnify and save harmless Southern \u201cagainst any and all damage resulting from the negligence\u201d of Champion. The jury determined that plaintiff\u2019s injuries did result from Champion\u2019s negligence. As a consequence of that negligence, Southern became obligated to plaintiff under F.E.L.A. for its failure to furnish him a safe place to work, and Champion in turn by contract became obligated to indemnify and save harmless Southern. Under these circumstances the contributory negligence of plaintiff, if any existed, would not have been a defense to Southern\u2019s contract action against Champion to enforce the indemnity agreement. Chicago, R.I. & P.R. Co. v. Dobry Flour Mills, 211 F. 2d 785 (10th Cir. 1954), cert. denied, 348 U.S. 832; Annotation: \u201cClaim, for Contribution or Indemnity Against Joint Tortfeasor, of Employer Liable to Employee under Federal Employer\u2019s [sic] Liability Act, As Affected by Contributory Negligence of Employee,\u201d 6 A.L.R. 3d 1307. Plaintiffs contributory negligence, if any, was available in mitigation of damages in plaintiff\u2019s F.E.L.A. action against Southern, but ... in this case the amount of plaintiffs recovery was ultimately settled by the consent judgment ... in which all parties, including Champion, joined.\nId. at 681-82, 193 S.E. 2d at 584.\nThis case is identical to Beachboard in the following respects: (1) plaintiff was obligated under the FELA to provide for its employees a safe place to work; (2) plaintiff obligated itself by contract to perform acts and render services in connection with defendant\u2019s privately owned railroad tracks and right-of-way which it was not obligated to perform for the public generally, see id. at 680, 193 S.E. 2d at 583; and (3) as part of the consideration for plaintiffs incurring that obligation, defendant promised to \u201cindemnify and save harmless\u201d the plaintiff \u201cagainst any and all damage\u201d resulting from defendant\u2019s negligence. The court in Beachboard obviously believed the FELA determinative of Southern\u2019s liability to its employee, and believed Champion to be liable to Southern pursuant to the indemnity agreement for any liability Southern incurred to its employees under the FELA on account of Champion\u2019s negligence.\nSuch must equally be the case here. The record raises an issue as to plaintiff\u2019s negligence and consequent liability to its employee, Whitson, as determined by the standards imposed by the FELA, discussed supra-, as to whether plaintiffs liability was occasioned by defendant\u2019s negligence, again as determined by the FELA standard, see Chicago, R.I. & P.R. Co., Steed, and Beachboard, supra; and as to defendant\u2019s liability, if so, to plaintiff, pursuant to the indemnity agreement. The granting of defendant\u2019s motion for summary judgment thus was error.\nIV.\nWe further agree with plaintiffs second contention, viz., that even if FELA standards were not implicated, the case should have been allowed to proceed on the theory of common law negligence. Whitson, as an employee of plaintiff working on defendant\u2019s property, was an invitee of defendant. Cf. Spivey v. Wilcox Company, 264 N.C. 387, 141 S.E. 2d 808 (1965) (employee of independent contractor, who had undertaken to install plumbing fixtures on defendant\u2019s premises, was an invitee of defendant). Defendant\u2019s duty to Whitson, therefore, was to exercise ordinary care to keep the premises in a reasonably safe condition so as not to expose him unnecessarily to danger, and to give warning of hidden conditions and dangers of which it had express or implied knowledge. Wrenn v. Convalescent Home, 270 N.C. 447, 154 S.E. 2d 483 (1967).\nAn owner or occupier of land ordinarily has no duty to warn of an obvious condition of which its invitee has equal or superior knowledge. Id.\nBut this is certainly not a fixed rule, and all of the circumstances must be taken into account. In any case where the occupier, as a reasonable man, should anticipate an unreasonable risk of harm to the invitee notwithstanding his knowledge, warning, or the obvious nature of the condition, something more in the way of precautions may be required. ... It is true also where the condition is one such as icy steps, which cannot be negotiated with reasonable safety even though the invitee is fully aware of it, and, because the premises are held open to him for his use, it is to be expected that he will nevertheless proceed to encounter it. In all such cases the jury may be permitted to find that obviousness, warning or even knowledge is not enough.\nW. Prosser, Handbook of the Law of Torts, \u00a7 61, pp. 394-95 (4th Ed. 1971) (emphasis supplied).\nThe undisputed facts of the accident here are set forth in Whitson\u2019s deposition as follows: Whitson was working as a switch-man for plaintiff on defendant\u2019s property when he slipped from a railroad car and injured himself. He attributed his fall to slippery conditions caused by feed from defendant\u2019s plant. He stated that when \u201cyou get [feed] on your feet it\u2019s just like being on ice.\u201d He had been aware of the danger for many years. He stated: \u201cFrom 1968 up until 1977 I was working at Interstate and during all that time of nine years I was slipping from time to time. . . . For the nine years I saw the same conditions over there and slipped time after time.\u201d Defendant never swept the area clean in response to complaints about the condition of the tracks.\nWhile the deposition clearly establishes that Whitson had knowledge of the obvious condition equal or superior to that of defendant, under the particular facts there was nevertheless a jury question as to whether defendant fulfilled its responsibility to keep the premises in a reasonably safe condition so as not to expose Whitson to unnecessary dangers. The cases cited by plaintiff, Long v. Methodist Home, 281 N.C. 137, 187 S.E. 2d 718 (1972); Wrenn v. Convalescent Home, supra; Little v. Oil Corp., 249 N.C. 773, 107 S.E. 2d 729 (1959); Phillips v. Industries, Inc., 44 N.C. App. 66, 259 S.E. 2d 769 (1979); and Brady v. Coach Co., 2 N.C. App. 174, 162 S.E. 2d 514 (1968), all involved situations in which the injured person recognized or should have recognized a one-time danger, and nevertheless elected to proceed. Here, by contrast, the record permits a finding that Whitson\u2019s job required that he work on the spur tracks on defendant\u2019s property and encounter the problem of slipping on the feed \u201ctime after time\u201d; and that defendant was cognizant of that requirement. The slippery tracks could not \u201cbe negotiated with reasonable safety even though\u201d Whitson was fully aware of the condition; and, because defendant\u2019s spur tracks were \u201cheld open to [Whitson] for his use,\u201d defendant should have expected that Whitson would \u201cproceed to encounter\u201d the slippery tracks. W. Prosser, supra, at pp. 394-95. Under these circumstances, reasonable care may have required more than a warning of the danger.\nIn Peterson v. W. T. Rawleigh Co., 274 Minn. 495, 144 N.W. 2d 555 (1966), the court allowed recovery to an employee who was injured when he slipped and fell on ice. At the time of his injury, the employee was picking up an order of household goods to deliver for defendant. The Minnesota Supreme Court adopted the following from the Restatement (Second) of Torts \u00a7 343A(l) (1965):\nA possessor of land is not liable to his invitees for physical harm caused to them by any activity or condition on the land whose danger is known or obvious to them, unless the possessor should anticipate the harm despite such knowledge or obviousness. [Emphasis supplied.]\nComment f under this section states:\nThere are . . . cases in which the possessor of land can and should anticipate that the dangerous condition will cause physical harm to the invitee notwithstanding its known or obvious danger. In such cases the possessor is not relieved of the duty of reasonable care which he owes to the invitee for his protection. This duty may require him to warn the invitee, or to take other reasonable steps to protect him, against the known or obvious condition or activity, if the possessor has reason to expect that the invitee will nevertheless suffer physical harm.\n. . . Such reason may also arise where the possessor has reason to expect that the invitee will proceed to encounter the known or obvious danger because to a reasonable man in his position the advantages of doing so would outweigh the apparent risk. In such cases the fact that the danger is known, or is obvious, is important in determining whether the invitee is to be charged with contributory negligence, or assumption of the risk. ... It is not, however, conclusive in determining the duty of the possessor, or whether he has acted reasonably under the circumstances.\nDefendant was not required to take extraordinary precautions for the safety of its invitees, Gas kill v. A. and P. Tea Co., 6 N.C. App. 690, 694, 171 S.E. 2d 95, 97 (1969), or to take precautions that would render the operation of its business impractical, Hedrick v. Tigniere, 267 N.C. 62, 67, 147 S.E. 2d 550, 554 (1966). It was, however, required to exercise reasonable care for the protection of its invitees under the circumstances; and the circumstances here included defendant\u2019s knowledge that plaintiffs employee, despite his knowledge of the obvious dangerous condition, had no choice but to encounter it in the fulfillment of the duties of his employment. Whether defendant\u2019s failure to take additional precautions for the employee\u2019s safety was reasonable under these circumstances was for the jury to determine.\nReversed and remanded.\nJudges Webb and Wells concur.",
        "type": "majority",
        "author": "WHICHARD, Judge."
      }
    ],
    "attorneys": [
      "Jones, Hewson & Woolard, by Hunter M. Jones and Harry C. Hewson, for plaintiff appellant.",
      "Grier, Parker, Poe, Thompson, Bernstein, Gage & Preston, by William E. Poe and Irvin W. Hankins, III, for defendant ap-pellee."
    ],
    "corrections": "",
    "head_matter": "SOUTHERN RAILWAY COMPANY, a Corporation v. ADM MILLING COMPANY, a Corporation\nNo. 8126SC992\n(Filed 7 September 1982)\n1. Indemnity \u00a7 2; Master and Servant \u00a7 38\u2014 liability under Federal Employers\u2019 Liability Act \u2014duty to indemnify under contract\nWhere (1) plaintiff was obligated under the FELA to provide for its employees a safe place to work; (2) plaintiff obligated itself by contract to perform acts and render services in connection with defendant\u2019s privately owned railroad tracks and right-of-way which it was not obligated to perform for the public generally; and (3) as part of the consideration for plaintiffs incurring the obligation, defendant promised to \u201cindemnify and save harmless\u201d the plaintiff \u201cagainst any and all damage\u201d resulting from defendant\u2019s negligence, and where plaintiffs employee was injured while working on a spur track serving defendant\u2019s Mecklenburg plant, the trial court erroneously entered summary judgment for defendant since there were issues as to plaintiffs negligence and subsequent liability to its employee as determined by the standards imposed by the FELA; as to whether plaintiffs liability was occasioned by defendant\u2019s negligence; and as to defendant\u2019s liability, if so, to plaintiff, pursuant to the indemnity agreement.\n2. Negligence \u00a7 53.1\u2014 duty of reasonable care for protection of invitee \u2014 knowledge of dangerous condition by invitee \u2014summary judgment improper\nIn an action where plaintiffs employee was injured while working on a spur track serving defendant\u2019s Mecklenburg plant, the case should have been allowed to proceed to the jury on the theory of common law negligence since the injured person, as an employee of plaintiff working on defendant\u2019s property, was an invitee of defendant, and since defendant was required to exercise reasonable care for the protection of its invitees under the circumstances; and the circumstances here included defendant\u2019s knowledge that plaintiff\u2019s employee, despite his knowledge of a slippery condition caused by defendant\u2019s feed being on tracks, had no choice but to encounter the dangerous condition in the fulfillment of the duties of his employment.\nAPPEAL by plaintiff from Allen, Judge. Judgment entered 18 June 1981, in Superior Court, Mecklenburg County. Heard in the Court of Appeals 30 April 1982.\nJones, Hewson & Woolard, by Hunter M. Jones and Harry C. Hewson, for plaintiff appellant.\nGrier, Parker, Poe, Thompson, Bernstein, Gage & Preston, by William E. Poe and Irvin W. Hankins, III, for defendant ap-pellee."
  },
  "file_name": "0667-01",
  "first_page_order": 699,
  "last_page_order": 708
}
