Court Opinion

ID: 3146106
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:13:15.829119+00
Date Added: 2024-06-11T12:28:33.362207
License: Public Domain

No. 1-05-2587
September 25, 2006

JOHN BUENZ, as Special Administrator of                     )      Appeal from the
the Estate of Olga L. Buenz, Deceased,                      )      Circuit Court of
                                                            )      Cook County.
                      Plaintiff,                            )
                                                            )
       v.                                                   )
                                                            )
FRONTLINE TRANSPORTATION COMPANY,                           )
VINCENTE A. ZEPEDA, Individually,                           )
CHINA OCEAN SHIPPING COMPANY, and                           )
CHINA OCEAN SHIPPING COMPANY AMERICAS,                      )
INC.,                                                       )
                                                            )
                      Defendants,                           )
                                                            )
(China Ocean Shipping Company Americas,                     )
Inc., Counterplaintiff-Appellee; Frontline                  )
Transportation Company;                                     )
Counterdefendant-Appellant; and                             )      Honorable
Vincente A. Zepeda, Individually,                           )      Diane C. Larsen
Counterdefendant).                                          )      Judge Presiding.

       JUSTICE ROBERT E. GORDON delivered the opinion of the court:

       The central issue in this appeal is whether an indemnification provision in an agreement

between counterplaintiff      China Ocean Shipping Co. Americas, Inc. (COSCO), and

counterdefendant Frontline Transportation Co. (Frontline) is sufficient to indemnify COSCO for its

own alleged negligence. COSCO and Frontline were both defendants in the underlying litigation,

which arose from a five-vehicle traffic accident that resulted in the death of Olga Buenz. Her

husband, John Buenz, filed the lead suit in this matter, a wrongful death complaint alleging

negligence on the part of COSCO, Frontline, and counterdefendant Vincente A. Zepeda. According
No. 1-05-2587

to the complaint, Zepeda, who was allegedly an agent of Frontline, was the driver of a tractor trailer

that struck a bus in which Olga Buenz was a passenger, causing her death. The complaint alleged

that COSCO Aowned and/or owned a leasehold on, maintained, and/or controlled the trailer and/or

container which were part of the tractor trailer@ driven by Zepeda. The equipment in question

apparently was leased to Frontline by COSCO. In June 2004, COSCO filed a counterclaim against

Frontline and Zepeda. In count IV of its counterclaim, which was against Frontline only, COSCO

sought a declaration of its rights under an equipment interchange agreement (interchange agreement)

between COSCO and Frontline. According to COSCO, Frontline was obligated, pursuant to the

interchange agreement, to indemnify COSCO for Aany and all costs, expenses, damages and liability

*** in the Buenz litigation.@ COSCO moved for summary judgment on count IV, and the circuit

court of Cook County granted the motion. Frontline filed a motion to reconsider, which was denied.

Frontline appeals from the circuit court=s orders granting COSCO=s motion for summary judgment

and denying Frontline=s motion to reconsider. For the reasons set forth below, we affirm and

remand.

                                         BACKGROUND

       The accident giving rise to the underlying litigation occurred on October 1, 2003, on

Interstate 90 in Marengo County. According to the record, the tractor trailer driven by Zepeda

struck the bus in which Olga Buenz was a passenger, starting a chain reaction in which the bus then

struck a pickup truck which, in turn, struck another vehicle, and so on. The Buenz complaint

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No. 1-05-2587

eventually was consolidated with a number of other lawsuits arising from the same accident. 1

       With regard to Frontline, the Buenz complaint alleged a number of negligent acts or

omissions on the part of Frontline, Aby and through its employee and agent,@ Zepeda, including: (1)

failure to keep proper control of the vehicle, (2) failure to keep a proper lookout for traffic, and (3)

failure to reduce speed or change direction to avoid a collision. Frontline denied that it was the

employer of Zepeda or that he was its agent, but admitted that there was a contractual relationship

between them. Frontline also denied the allegations of negligence. The Buenz complaint also

alleged a number of negligent acts or omissions on the part of COSCO, including: (1) permitting the

Atrailer and/or container@ to be used and operated when it knew or should have known that it was not

in safe operating condition, (2) permitting the trailer to be used and operated when it knew or should

       1
           The case numbers of the cases consolidated with Buenz v. Frontline Transportation Co.,

No. 03 L 12014, include Nos. 03 L 11883, 03 L 11887, 03 L 13794, 03 L 14280, 03 L 14936, 03

L 14712, 04 L 01975, 04 L 03190, 04 L 03194, 04 L 04139, and 04 L 08417.

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No. 1-05-2587

have known that it was not equipped with proper brakes, and (3) failing to inspect and repair the

trailer. COSCO denied these allegations.

       In count IV of its counterclaim against Frontline, COSCO referred to the interchange

agreement between COSCO and Frontline, which the parties agree was in effect on October 1, 2003,

the date of the accident at issue in this case. This agreement, which dealt with the relationship

between COSCO and Frontline regarding the Ause and/or interchange@ of equipment such as

containers 2 and chassis, included an indemnity provision. This provision stated, in pertinent part:

       AThe ACQUIRING CARRIER [Frontline] shall indemnify The Line [COSCO] against, and

       hold The Line harmless for any and all claims, demands, actions, suits, proceedings, costs,

       expenses, damages, and liability, including without limitation attorney=s fees, arising out of,

       [in] connection with, or resulting from the possession, use, operation or returning of the

       equipment during all periods when the equipment shall be out of the possession of The

       Line.@

COSCO alleged that the accident at issue in the Buenz complaint Aarose out of, [was] in connection

       2
           A Acontainer@ is defined as Aa portable usu. metal compartment in which freight is placed

for convenience of movement esp. on railroad container cars.@ Webster=s Third New

International Dictionary 491 (2002).

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No. 1-05-2587

with or result[ed] from the possession, use or operation of [the tractor trailer] by Frontline.@ COSCO

sought from the circuit court, pursuant to section 2-701 of the Code of Civil Procedure (735 ILCS

5/2-701 (West 2004)), a declaration Athat Frontline is obligated, pursuant to the Interchange

Agreement, to indemnify and hold COSCO harmless for any and all costs, expenses, damages and

liability, including attorneys= fees, in the Buenz litigation.@

        In March 2005, COSCO filed a motion for summary judgment on count IV of its

counterclaim. In support of this motion, COSCO pointed to the indemnification provision in the

interchange agreement, focusing in particular on the phrase Aany and all@ in the statement asserting

that Frontline would hold COSCO harmless Afor any and all claims *** resulting from the

possession, use, operation or returning of the equipment during all periods when the equipment shall

be out of the possession of [COSCO].@ (Emphasis added.) COSCO argued that the phrase Aany and

all@ signified the parties= intent that COSCO was to be indemnified against claims arising out of its

own negligence. COSCO argued, in addition, that the underlying negligence claims against COSCO

fell within the scope of the conduct described in the indemnity provision.

        In response, Frontline disagreed with both parts of COSCO=s argument. In Frontline=s view,

the phrase Aany and all@ was neither specific nor clear enough to signify an intention that Frontline

would indemnify COSCO for claims resulting from COSCO=s own negligence. In addition, Frontline

argued, contrary to COSCO=s contention, that the underlying negligence claims against COSCO did

not fall within the scope of the indemnity provision. Frontline noted that this provision specifically

limited indemnification to those situations where the equipment was out of COSCO=s control and

possession. However, in Frontline=s view, the claims against COSCO, such as the allegation that

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No. 1-05-2587

COSCO failed to inspect and repair the trailer, Aare not related to periods when the equipment is out

of the possession of COSCO, but rather to periods in which the equipment is in the possession of

COSCO.@

       On June 10, 2005, the circuit court granted COSCO=s motion for summary judgment on

count IV. 3 In its order, the court referred to Supreme Court Rule 304(a) (155 Ill. 2d R. 304(a)),

which deals with judgments as to one or more but fewer than all of the parties or claims in a

proceeding. Pursuant to Rule 304(a), the circuit court stated: AThere is no just reason to delay appeal

or enforcement of this court=s judgment@ as to count IV. Frontline=s motion to reconsider was denied

on July 20, 2005. As noted, Frontline appeals from the circuit court=s June 10 order granting

COSCO=s motion for summary judgment and the court=s July 20 order denying Frontline=s motion to

reconsider.

                                           DISCUSSION

       Summary judgment is proper where, when viewed in the light most favorable to the

nonmoving party, the pleadings, depositions, admissions, and affidavits on file reveal that there is no

genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of

law. General Casualty Insurance Co. v. Lacey, 199 Ill. 2d 281, 284 (2002); 735 ILCS 5/2-1005(c)

(West 2004). We review the granting of a motion for summary judgment de novo. General Casualty

       3
           On November 15, 2005, the circuit court entered an order nunc pro tunc to June 10,

2005, providing that the court=s order granting summary judgment in favor of COSCO applied to

all pending consolidated cases in the underlying litigation.

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No. 1-05-2587

Insurance Co., 199 Ill. 2d at 284; Amalgamated Transit Union, Local 241 v. Chicago Transit

Authority, 342 Ill. App. 3d 176, 179 (2003).

       In Illinois, contracts of indemnity against one=s own negligence are generally valid and

enforceable, provided that the indemnitor=s obligations are set forth in clear and explicit language.

Burlington Northern R.R. Co. v. Pawnee Motor Service, Inc., 171 Ill. App. 3d 1043, 1045 (1988). It

is not necessary that such a contract make specific reference to indemnification for an indemnitee=s

negligence, so long as the language employed clearly indicates that this was the intent of the parties.

Rios v. Field, 132 Ill. App. 2d 519, 521-22 (1971).

                            A. Construction of the Phrase AAny and All@

       In the case at bar, as previously indicated, the parties dispute whether the phrase Aany and all@

in the indemnity clause constitutes an explicit or unequivocal expression of an intent that COSCO be

indemnified for its own negligence. COSCO argues that the parties= use of use of this phrase

explicitly shows such an intent, and Frontline disagrees.

       In considering this issue, several panels of this court have concluded that use of the phrase

Aany and all@ in an indemnity agreement is sufficient to include liability arising from the

indemnitee=s negligence. Haynes v. Montgomery Ward & Co., 47 Ill. App. 2d 340 (1964); Economy

Mechanical Industries, Inc. v. T.J. Higgins Co., 294 Ill. App. 3d 150 (1997); Rios v. Field, 132 Ill.

App. 2d 519 (1971); Fosco v. Delisi, 103 Ill. App. 2d 457 (1968). In Haynes, for example, the

plaintiff (The Fair), a retailer, had contracted with SOS, a janitorial services company, to maintain

The Fair=s store in downtown Chicago. In order for SOS to be able to perform its services, SOS was

given the use of one of the store=s elevators. The floor indicator on this elevator was permanently

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No. 1-05-2587

stuck. A janitor employed by SOS stepped into what he thought was the elevator car, but instead

was the elevator shaft, and fell to the bottom. The janitor sued The Fair, and the trial resulted in a

judgment for the janitor. The Fair brought a third-party action against SOS, claiming that SOS was

obligated to indemnify The Fair under the terms of an indemnity provision included in the contract

between The Fair and SOS. This provision stated: A>It is agreed that the Vendor [SOS] holds the

Vendee [The Fair] harmless for any and all injuries or accident sustained by the Vendor=s employees

while on the premises of the Fair Store Company or while en route to perform any services for the

Vendee.=@ Haynes, 47 Ill. App. 2d at 341. The trial judge denied The Fair=s motion for judgment

against SOS and entered judgment in favor of SOS. On appeal, the appellate court reversed. The

appellate court held that the contract between The Fair and SOS Aexpresses the intention that The

Fair shall be indemnified against its own negligence.@ Haynes, 47 Ill. App. 2d at 346. The court

pointed to the agreement=s use of the phrase Aany and all@ and stated:

       AThe words >any and all= are all inclusive; their conciseness does not limit their scope; their

       coverage would not have been extended by making them more specific. If the words >any

       and all= are to have their commonly accepted meaning, they cover the accident in this case.@

        Haynes, 47 Ill. App. 2d at 346-47.

       Notwithstanding the foregoing, Frontline points to Karsner v. Lechters Illinois, Inc., 331 Ill.

App. 3d 474 (2002), a Third District case which held that the phrase Aany and all@ in the parties=

indemnity agreement was insufficient to indemnify the indemnitee for its own negligence. Karsner,
331 Ill. App. 3d at 477. Karsner has been rejected by Washington Group International, Inc. v.

Mason Manufacturing, Inc., 263 F. Supp. 2d 1115 (N.D. Ill. 2003). In Washington Group, one of

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No. 1-05-2587

the defendants (the indemnitee) filed a cross-claim for indemnity against the other defendant, based

on a contract between them. This contract included a clause providing that the indemnitee would be

indemnified for Aany and all@ claims arising from the services to be provided by the indemnitor

under the contract. The indemnitor moved to dismiss the indemnitee=s cross-claim, arguing that the

provision was unenforceable because it did not constitute a clear and explicit promise to indemnify

against the indemnitee=s own negligence. The court denied the motion. According to the court in

Washington Group, the Aany and all@ language included in the indemnity provision was sufficient to

provide coverage for the indemnitee=s negligence. In reaching this decision, the court pointed to

cases dealing with similar Aany and all@ language that had come to the same conclusion. Among

these cases was Economy Mechanical Industries, Inc. v. T.J. Higgins Co., 294 Ill. App. 3d 150

(1997).           We agree with Washington Group and the cases cited therein regarding the proper

interpretation of the phrase Aany and all.@ As the court in Economy Mechanical Industries stated:

                  AIn an indemnity agreement, a general reference to >any and all= claims, losses,

          injuries, and the like will generally be construed as indicating an intention by the parties that

          the indemnitee be indemnified for damages resulting from the indemnitee=s own negligence.@

          Economy Mechanical Industries, 294 Ill. App. 3d at 155.

In our view, this accurately states the prevailing interpretation of the phrase Aany and all@ under

Illinois law. Accordingly, we decline to follow Karsner, which runs counter to this interpretation.

In the case at bar, we conclude that the phrase Aany and all@ in the indemnity clause showed

unequivocally that the parties intended for COSCO to be indemnified against any and all negligence

claims within the scope of the indemnity provision, including those arising from COSCO=s own

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No. 1-05-2587

negligence.

                             B. The Scope of the Indemnity Provision

       Frontline also argues that the underlying negligence claims against COSCO did not fall

within the scope of the indemnity provision and the granting of summary judgment was improper on

this ground as well. As previously indicated, these underlying claims included allegations that

COSCO:

(1) permitted the Atrailer and/or container@ to be used and operated when it knew or should have

known that it was not in safe operating condition, (2) permitted the trailer to be used and operated

when it knew or should have known that it was not equipped with proper brakes, and (3) failed to

inspect and repair the trailer. Frontline notes that the indemnity provision in the interchange

agreement is limited to those situations where COSCO=s equipment was out of COSCO=s control and

possession. In Frontline=s view, the claims against COSCO, such as the allegation that COSCO

failed to inspect and repair the trailer, Aare not related to periods when the equipment was out of the

possession of COSCO, but rather to periods in which the equipment [was] still within COSCO=s

possession.@

       We disagree with Frontline=s contention that the claims against COSCO are not within the

scope of the indemnity provision. Under this provision, as previously indicated, Frontline is

required to indemnify COSCO for any and all claims arising out of, in connection with, or resulting

from Athe possession, use, operation or returning of the equipment during all periods when the

equipment shall be out of the possession of the Line.@ It is undisputed that it was Frontline (not

COSCO) that was using the equipment in question at the time of the accident. Moreover, this

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No. 1-05-2587

accident was the occurrence that gave rise to the underlying claims. These claims, including the

allegations against COSCO, clearly arose from, were in connection with, or resulted from Frontline=s

use and operation of the equipment at a time when the equipment was out of the possession of

COSCO. See Burlington Northern R.R. Co. v. Pawnee Motor Service, Inc., 171 Ill. App. 3d 1043,

1047 (1988) (indemnity provision need not state the specific acts of negligence to be covered in

order to be effective).

       We conclude that the indemnity provision in the case at bar clearly and unequivocally stated

the parties= intention that COSCO was to be indemnified for any and all negligence claims within the

scope of the indemnity provision, including those arising from COSCO=s own negligence. We

conclude, in addition, that the underlying claims against COSCO are within the scope of this

indemnity clause.

                                         CONCLUSION

       For the reasons set forth above, we affirm the circuit court=s granting of summary judgment

in favor of COSCO on count IV of COSCO=s counterclaim. We also affirm the circuit court=s denial

of Frontline=s motion to reconsider. The cause is remanded to the circuit court for further

proceedings.

       Affirmed and remanded.

       McBride, P.J. and Cahill, J., concur.

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No. 1-05-2587

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