Opinion ID: 1486394
Heading Depth: 1
Heading Rank: 2

Heading: McDONNELL AIRCRAFT, CONTRACTUAL INDEMNITY AND RELATIVE FAULT

Text: The Court of Appeals, Eastern District, transferred this case because it was not certain as to the interpretation of [ McDonnell Aircraft Corp. v. Hartman-Hanks-Walsh Painting Co., 323 S.W.2d 788 (Mo. 1959)] in light of [ Whitehead and Kales ]. Whitehead and Kales criticized McDonnell Aircraft as a case in which the discredited active-passive approach had produced an award of full indemnity despite the fact that the conduct of the indemnitee in these cases was also careless and blameworthy. 566 S.W.2d at 472. Thus, Whitehead and Kales recognized that the claim for indemnity involved in McDonnell Aircraft was essentially a claim based on the alleged negligence of the indemnitor. Nevertheless, the principal opinion would exclude appellant's claim for indemnity from the requirement that the fault of those who caused the plaintiff's injury should be determined and apportioned. The principal opinion would hold that McDonnell Aircraft is still good law after the adoption of relative fault, noting that Whitehead and Kales expressly excluded from its holding indemnity which comes about by reason of contracts. 566 S.W.2d at 468 n. 2. The reservation of an issue not presented to the Court in Whitehead and Kales should not be interpreted as an implied holding on that issue when the Court is called upon to decide it. The general principles on which Whitehead and Kales relied require the apportionment of fault in a case involving a claim of contractual indemnity patterned after McDonnell Aircraft . In McDonnell Aircraft , Arbuckle was injured while working as a painter for Hartman on McDonnell's premises. Arbuckle obtained a judgment against McDonnell, and McDonnell sought indemnity from Arbuckle's employer, Hartman. The Court noted that McDonnell owed Arbuckle a non-delegable duty to warn of unsafe conditions. Nevertheless, it held that McDonnell had stated a claim for indemnity by alleging that Hartman had agreed to assume and perform this duty and negligently failed to do so. 323 S.W.2d at 794. The Court discussed at length whether there was a right of indemnity against one who agreed to assume the indemnitee's non-delegable duty to warn the plaintiff of hazards on the indemnitee's premises. The Court held that there was such a right of indemnity, relying on Restatement of Restitution § 95, which provides that Where a person has become liable with another for harm caused to a third person because of his negligent failure to make safe a dangerous condition of land or chattels . . . which, as between the two, it was the other's duty to make safe, he is entitled to restitution. 323 S.W.2d at 794. Surely a claim for indemnity based on an allegation of negligent failure to warn requires apportionment of liability in accordance with the degree of fault of those whose conduct concurred to cause harm. There is nothing in the argument in McDonnell Aircraft for characterizing Hartman's duty as a contractual obligation that warrants abandoning the doctrine of relative fault in such a case. Such a limitation of the doctrine of relative fault would place the entire burden of the plaintiff's loss, in an all-or-nothing fashion, on the indemnitor, even though the indemnitee. . . was also careless and blameworthy. Such a result clearly violates the principle that one is not liable for damage one did not wrongfully cause. McDonnell Aircraft strained to characterize McDonnell's indemnity claim as contractual, apparently in order to avoid the bar of the workmen's compensation statute. Section 287.120.1, RSMo, provides that the employer subject to the workmen's compensation act shall be released from all other liability [for personal injury or death of the employee by accident arising out of and in the course of his employment] whatsoever, whether to the employee or any other person. (Emphasis added.) Despite this provision, McDonnell Aircraft held that an employer subject to the workmen's compensation act could be required to indemnify a third party, where the third party was held liable for negligently injuring the employee. McDonnell Aircraft reasoned that the employer's liability to indemnify the third party for failure to warn was not a liability for personal injury or death of the employee within the meaning of the release provision in § 287.120.1, RSMo. Instead, the Court held that such liability to indemnify the third party was liability for breach of an independent duty or obligation owed to a third party by an employer. The Court stated: [T]he Act does not prevent holding Hartman liable to indemnify McDonnell for loss caused McDonnell by the breach of its duty to McDonnell, which arose by reason of Hartman's express agreement to assume and perform it. Such a ruling does not hold the employer liable for the personal injury or death of his employee but instead holds him liable for the breach of an independent duty to a third party which he expressly agreed to perform. Id. at 796. The Court stated that the workmen's compensation act was not intended to affect the rights of third parties outside the employer-employee relationship. Id. I believe that the unmistakable language of § 287.120.1, RSMo 1978, releasing the employer from all other liability . . . whatsoever, whether to the employee or any other person, is easily broad enough to release the employer from liability for breach of a duty owed a third party. Moreover, the employer's liability for such breach is directly tied to his employee's injury: no claim of indemnity would arise unless the employee was injured as a proximate result of the employer's breach of a duty to warn and the employee held the third party liable in damages for the employee's injuries. Thus, holding the employer liable in such a case is holding him liable both for the breach of duty owed to a third party and (indirectly) on account of the personal injury or death of his employee. It is only through the use of an abbreviated description of the origin of the employer's liability that McDonnell Aircraft made such liability appear to be outside the scope of § 287.120.1, RSMo 1978. McDonnell Aircraft relied heavily on the construction given the exclusivity provision of the Longshoremen's and Harbor Workers' Compensation Act by the United States Supreme Court in Ryan Stevedoring Co. v. Pan-Atlantic Corp., 350 U.S. 124, 76 S.Ct. 232, 100 L.Ed. 133 (1956). I believe that the provision construed in Ryan is significantly different from § 287.120.1, RSMo 1978, and that McDonnell Aircraft 's resolution of the question resulted from a failure to give careful attention to the unique wording of our statute. I would overrule McDonnell Aircraft to the extent that it conflicts with the views herein expressed. In accordance with the views expressed in the previous section, the fact that § 287. 120.1, RSMo 1978, immunizes the employer from liability for indemnity, contractual or non-contractual, for damages paid to an injured employee does not imply that the allegedly negligent employer should not remain a party to the lawsuit. His relative fault must be determined in order accurately to determine the relative fault of the non-employer defendant. Accordingly, I would reverse and remand the case for such further proceedings as are necessary to ensure that appellant's liability is directly proportionate to its degree of fault. DONNELLY, Judge, dissenting. In Anderson v. Cahill, 528 S.W.2d 742, 749 (Mo. banc 1975), Judge Seiler joined me in expressing the view that this Court should consider adopting a pure form of comparative fault. In Missouri Pacific Railroad Co. v. Whitehead and Kales Co., 566 S.W.2d 466 (Mo. banc 1978), this Court embraced a concept of relative fault. In State ex rel. Maryland Heights Concrete Contractors, Inc. v. Ferris, 588 S.W.2d 489 (Mo. banc 1979), this Court neutered the Whitehead and Kales holding. As a result, the Bench and Bar of Missouri were left in a state of hopeless confusion. In Steinman v. Strobel, 589 S.W.2d 293, 295 (Mo. banc 1979), my perception of pure comparative fault was considered and rejected by a majority of this Court. The dissenting opinion filed in this case by Judge Welliver articulates beautifully the rationale for my dissenting opinion in Steinman, supra . However, pure comparative fault has again been rejected. I have been given ample opportunity to persuade and have failed. I have no right, in these circumstances, to continue to array my judgment against that of the majority of my brethren on this Court. And, of course, the confusion resulting from the stillbirth in 1978 continues unabated. Accordingly, I must conclude, with regret, that we should overrule Whitehead and Kales and return the law of torts in Missouri to whatever degree of stability existed for the one hundred and fifty years prior that decision. Steinman, supra, 589 S.W.2d 293, 295 (Welliver, J., concurring). I respectfully dissent.