Opinion ID: 456302
Heading Depth: 2
Heading Rank: 4

Heading: The Principle Applied

Text: 27 Thus, we must decide whether overriding public policy considerations are present in this case sufficient to override the parties choice of law decision. The appellee argues that the statute itself as interpreted in Paul Krebs & Assocs. is indication of an overriding public policy. If the statute in question, Sec. 25-5-53 of the Alabama Code were to expressly prohibit such indemnity provisions then that would be a persuasive argument. Public policy can generally be found in express and direct legislation. However, the Alabama statute relating to the exclusivity of remedy and suits against employers arising out of employee accidents subject to Alabama Workmen's Compensation Act makes no mention of public policy considerations, particularly in respect to suits by third parties under a contract for indemnity stipulated to be made in and to be governed by the laws of a state other than Alabama. Furthermore, as was noted earlier, the Supreme Court of Alabama had previously interpreted the statute to allow such indemnity contracts. It was not until the Paul Krebs & Assocs. decision, supra, after the parties had entered into the indemnity contract that Alabama law was judicially changed and the statute was so interpreted. 28 We further note that neither Mead nor GFFS are Alabama corporations. Rather, they are large and sophisticated corporations domiciled and incorporated in foreign states where such claims for contractual indemnity against employers in situations like the one involved here are enforceable. These companies knowingly entered into an agreement permitting indemnity and specifying the application of the law of the state of Michigan. It cannot be seriously contended that a member of the public in Alabama could be in any way affected in the suit between a Michigan company (GFFS) and an Ohio corporation (Mead) for indemnity under a contract legally enforceable in the courts of every other state in this country and more to the point, enforceable in the state whose law they chose to govern their agreement. As the Alabama courts have stated, [i]f it definitely appears that enforcement of a contract will not be followed by injurious results generally [to the public], at least what the parties have agreed to ought not to be struck down. Lowery v. Zorn, supra, 9 So.2d at 874. 29 The most common examples of states refusing to enforce contracts against public policy are generally more extreme cases involving, for example, gambling. See, e.g., Dorado Beach Hotel Corp. v. Jernigan, 202 So.2d 830 (Fla.Dist.Ct.App.1967); c.f., Intercontinental Hotels v. Golden, supra. The issue involved in this case, however, is not one that can be said to be so far outside the pale of social, economic and moral standards currently imposed by our civilization as to be violative of the strong public policy of the State of Alabama. 30 Thus we believe that the district court erred in dismissing GFFS's counterclaim against Mead and that an Alabama state court faced with this issue would not have found an overriding public policy, therefore, the decision of the district court is 31 REVERSED and REMANDED.