Court Opinion

ID: 9545246
Source: CourtListenerOpinion
Date Created: 2023-08-07 17:08:54.564294+00
Date Added: 2024-06-11T15:14:23.889904
License: Public Domain

Swanson, J. (dissenting)
I must disagree.
Initial inquiry must focus on RCW 51.04.010, the statute upon which an employer's claim of immunity rests, which states in pertinent part:
The state of Washington, . . . declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for workmen, ... is hereby provided ... to the exclusion of every other remedy, proceeding or compensation, . . . and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished, . . .
(Italics mine.) The importance of the above-italicized clauses lies in the limitations they impose on the otherwise broad legislative ban on civil litigation arising from fact patterns covered by the industrial insurance act. The Supreme Court of the United States, in Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., 350 U.S. 124, 129, 100 L. Ed. 133, 76 S. Ct. 232 (1956), interpreted analogous language1 as follows:
The obvious purpose of this provision is to make the statutory liability of an employer to contribute to its employee's compensation the exclusive liability of such employer to its employee ... on account of his injury or death arising out of that employment.
The court went on to declare that a third-party complaint springing "from an independent contractual right" was not barred thereby. Numerous other courts have recognized that the breach of an independent duty may result in an *99employer's liability to a third party regardless of a prior award of employee compensation. See, e.g., Dole v. Dow Chem. Co., 30 N.Y.2d 143, 152, 282 N.E.2d 288, 294, 331 N.Y.S.2d 382, 53 A.L.R.3d 175 (1972); Blackford v. Sioux City Dressed Pork, Inc., 254 Iowa 845, 855, 118 N.W.2d 559, 565 (1962); McDonnell Aircraft Corp. v. Hartman-Hanks-Walsh Painting Co., 323 S.W.2d 788, 796 (Mo. 1959).
This line of reasoning has been recognized by the Washington courts. Thus, in our earlier decision in Tucci & Sons, Inc., v. Carl T. Madsen, Inc., 1 Wn. App. 1035, 467 P.2d 386 (1970), this court upheld a written indemnification agreement between a subcontractor employer and a third-party general contractor, thereby permitting the employer to voluntarily assume the burden of indemnification and create a contractual right with a third party, independent of the exclusive jurisdiction provision of the industrial insurance act. In the later case of Montoya v. Greenway Aluminum Co., 10 Wn. App. 630, 519 P.2d 22 (1974), however, we refused to imply a contractual right to indemnity from a licensor/licensee relationship and specifically denied indemnity to an allegedly passive third-party joint tortfeasor against an employer who was an active or primary tort-feasor. The decision in Montoya states at pages 635-36:
An indemnity will not exist in this state in the face of the industrial insurance act in the absence of a contract between the indemnitor and indemnitee. Broxson v. Chicago, M., St. P. & P. R.R., 446 F.2d 628 (9th Cir. 1971); Tucci & Sons, Inc. v. Carl T. Madsen, Inc., supra. The employer may ignore the immunity of the industrial insurance act and indemnify the third party when the parties have independently created such a contractual right. It will not exist otherwise.
The question in Washington therefore becomes whether an independent duty, for the purpose of indemnifying a third party, may arise solely from an express contractual agreement or whether such may be implied from a contractual *100status. After reviewing the opinion in Tucci, the Montoya court observed that the Tucci decision
indicates that an indemnity will not be implied in the absence of a contract between the parties. It did not go so far as to state that a specific written indemnification agreement is a sine qua non for recovery by a third party. That slim question was not before the [Tucci] court, and is not before us now.
(Italics mine.) Montoya v. Greenway Aluminum Co., supra at 635. We also recognized in Montoya that other courts have found implied promises to indemnify the third party when a contractual relationship has been entered into between the employer and the third party. Montoya v. Greenway Aluminum Co., supra at 635, citing Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., supra; Weyerhaeuser S.S. Co. v. United States, 372 U.S. 597, 602, 10 L. Ed. 2d 1, 83 S. Ct. 926 (1963).
Two issues should thus confront the court as decisive on this appeal. First, does the evidence presented suffice to establish a question of fact as to whether a contractual relationship of seller and purchaser exists between the appellants, Pacific Press and Buckner-Weatherby, and respondent Collator.2 Second, may an independent duty of reasonable care in operating and providing safeguards for the machine purchased be implied from a seller/purchaser status, from which indemnity may be invoked should such obligation be breached. If both of these issues are resolved affirmatively, then appellants deserve the opportunity to attempt to prove a breach of the implied duty.
As to the first issue, appellants contend that the sales agreement for the purchase and sale of the hydraulic press, *101as evidenced by an invoice together with the testimony of the sales manager of Pacific Press, is sufficient to establish a question of fact regarding the alleged contractual relationship of buyer and seller between the parties. I agree. The more troublesome question turns on whether an implied duty of reasonable care in the use of purchased merchandise inures in the purchaser to the seller. It is here that I disagree with the majority.
In the recent case of United States Fidelity & Guar. Co. v. Kaiser Gypsum Co., 273 Ore. 162, 539 P.2d 1065 (1975), the Oregon Supreme Court confronted this issue in a fact pattern quite analogous to that before us. There an employee lost his hand in an accident involving a machine which, at the request of the employer, was installed without a safety guard. After receiving full workmen's compensation, the employee filed suit against the installing company, alleging negligence. The subrogated insurer of the installer settled the employee's claim and then brought a common-law action for indemnity against the employer. Upon motion, the trial court dismissed the indemnity action on the ground that the exclusive remedy provision of the Oregon Workmen's Compensation Act barred third-party actions for indemnity against an employer. The Oregon Supreme Court made an exhaustive analysis of the many cases discussing the question of an implied independent duty owed a third-party plaintiff by an employer, and concluded:
We find that a substantial majority and the better reasoned cases allow a third party to recover indemnity from an employer when the injury to the employe for which the third party was held liable resulted from the breach of an independent duty owed to the third party by the employer. This duty will be implied by law from the relationship between the employer and the party seeking indemnity.
(Footnote omitted.) United States Fidelity & Guar. Co. v. Kaiser Gypsum Co., supra at 177. See also cases cited therein. Thus an independent duty of care owed to a third *102party by an employer was implied by law from a seller/purchaser relationship between said parties.
I am persuaded that the Oregon court accurately appraised the existing authority and reasoning in this area. Further, I do not believe the legislature, by enacting a workmen's compensation statute, intended to protect negligent employers from common-law indemnity actions by third parties. This position draws strength from strong Washington precedent dictating that common-law rights should not be lost absent express statutory language. For example, the court in In re Estate of Tyler, 140 Wash. 679, 684, 250 P. 456, 51 A.L.R. 1088 (1926), asserted the following:
In this state there is also a general statute, Rem. Comp. Stat., § 143 [P. C. § 8252], which is pertinent. It provides:
"The common law, so far as it is not inconsistent with the constitution and laws of the United States, or of the state of Washington, nor incompatible with the institutions and condition of society in this state, shall be the rule of decision in all the courts of this state."
We have held that any law in derogation of the common law should be strictly construed.
See also McDermott v. Kaczmarek, 2 Wn. App. 643, 648, 469 P.2d 191 (1970); Marble v. Clein, 55 Wn.2d 315, 317-18, 347 P.2d 830 (1959). Thus, in view of the lack of statutory language derogating the right of indemnity in a third party where the cause of action arises from something other than the personal injury of the employee, said right should be preserved.3
I therefore think it appropriate to permit a common-law action for indemnity to go forward when the complaint alleges a breach of independent duty of the purchaser/employer to the seller/third party to use due care *103during the operation of the purchased machine. Such a duty is implied in the contractual relationship between the parties. The exclusionary provision of the industrial insurance act does not bar an action arising from such a source.4
I am also persuaded by the equity involved. As stated in 2A A. Larson, The Law of Workmen's Compensation § 76.52 (1976):
The question here becomes very precise: did the compensation acts, in conferring immunity on the employer from common-law suits, mean to do so only at the expense of the injured employee, or also at the expense of outsiders? One answer is that the injured employee got quid pro quo, in receiving assured compensation payments as a substitute for tort recoveries, while the third party has received absolutely nothing, and hence should not be impliedly held to have given up rights which he had before. It is unfair, so the argument runs, to pull the third party within the principle of mutual sacrifice when his part is to be all sacrifice and no corresponding gain.
A number of courts have concurred in this argument. See, e.g., Blackford v. Sioux City Dressed Pork, Inc. supra; Lunderberg v. Bierman, 241 Minn. 349, 364, 63 N.W.2d 355, 365, 43 A.L.R.2d 865 (1964); Ryan Stevedoring Co. v. Pan-Atlantic S.S. Corp., supra. The equities of sacrifice and gain are highlighted in Washington where RCW 51.24-.010 serves to protect the employer by allowing the subrogation or assignment in the employer of an employee's rights based on the negligence of a third party. There is however, no reciprocal right vested by the statute in a third party based on negligence of the employer. Thus, immunizing the employer from a third-party indemnity complaint constitutes an unequal division of responsibility.
To recapitulate, the Tucci case involved an express, written indemnification agreement between the employer and a *104third party, so that the cause of action was not "for such personal injury," (and thus abolished by the industrial insurance act, RCW 51.04.010), but arose from an independently created contractual right outside the exclusive remedy provision of the workmen's compensation act. In Montoya, no contractual relationship existed between the parties upon which to base a cause of action for indemnity independent of the exclusive remedy provision of the act. Here, sufficient evidence is present to create a question of fact as to whether a contractual relationship existed between the third parties and the employer. If such a relationship were to be found by the trier of fact to exist, an independent duty of care owed by the employer to the third parties may be implied. It would then become the responsibility of appellants to demonstrate this independent duty had in fact been breached, thereby justifying an indemnity. A breach of the implied duty should support the third parties' indemnity claim because it would not be a cause of action "for such personal injuries," which is abolished by the act, but rather would be a cause of action based on an independently created implied duty of due care arising from the contractual relationship between the parties of purchaser and seller.
The judgment of the trial court should be reversed and the case remanded for trial.
Petition for rehearing denied April 4, 1978.
Review denied by Supreme Court September 22, 1978.

The Longshoremen's and Harbor Workers' Compensation Act, 33 U.S.C. § 901 (1970) et seq., before the court in Ryan at 128-29 reads as follows:
"Sec. 5. The liability of an employer prescribed in section 4 [for compensation] shall be exclusive and in place of all other liability of such employed to the employee, . . . and anyone otherwise entitled to recover damages from such employer at law or in admiralty on account of such injury or death, ..." 44 Stat. 1426, 33 U S C § 905.

The importance of establishing a contractual relationship between the employer and the third party is indirectly emphasized in two recent Washington Supreme Court cases which demonstrate the conclusive exclusion of tort actions under the industrial insurance act. See West v. Zeibell, 87 Wn.2d 198, 550 P.2d 522 (1976), and Ledesma v. A.F. Murch Co., 87 Wn.2d 203, 550 P.2d 506 (1976) (in which the court stressed the broad nature of the exclusionary language of RCW 51.04.010 while rejecting the- tort claim of third-party parents for the alleged wrongful death of their minor employee son).

I agree with the Supreme Court of Iowa when it stated, "An intention of the legislature, in enacting a statute for the regulation of rights between the employer and employee, to destroy the rights of third parties should at the very least be clearly expressed." Blackford v. Sioux City Dressed Pork, Inc., 254 Iowa 845, 855, 118 N.W.2d 559 (1962).

It should be noted that at least two courts recently have declared unconstitutional the provision of workmen's compensation acts giving an employer immunity against a third party's common-law action for indemnity. See Carlson v. Smogard, 298 Minn. 362, 215 N.W.2d 615 (1974); Sunspan Eng'r & Constr. Co. v. Spring-Lock Scaffolding Co., 310 So. 2d 4 (Fla. 1975).