Court Opinion

ID: 5074884
Source: CourtListenerOpinion
Date Created: 2021-10-01 11:14:11.927571+00
Date Added: 2024-06-11T08:19:58.647295
License: Public Domain

TURNAGE, Presiding Judge.
Norfolk & Western Railway Co. filed a third party petition against W.M. Brode Company seeking indemnification for the amount it had paid Ronald Tumlinson as a result of a railroad crossing accident. Trial to the court resulted in a judgment in favor of Brode and Norfolk appeals.
The facts were stipulated. In May, 1985, Norfolk entered into an agreement with Brode for the replacement of a bridge over Wakenda Creek near Wakenda in Carroll County.
Section 5.1 of the agreement provides: Contractor shall indemnify and hold harmless the Company, its officers, agents and employees, from and against any and all liability, demands, claims, losses, costs and expenses arising from or in connection with (i) any claims for personal injury and/or property loss or damage to whomsoever or whatsoever occurring or arising in any manner out of or in connection with the work, this Contract, any act or omission of Contractor, its officers, agents or employees or the presence of Contractor, its officers, agents or employees upon or about the property or premises of Company, whether or not negligence on the part of Company, its officers, agents or employees may have caused or contributed to such injury, death, loss or damage; ....
Section 1.4 of the agreement defined the word “work” as “all or any part of the Contractor’s obligations and other matters referred to in Section 1.1.” Section 1.1 required Brode to furnish all “materials, superintendence, labor, equipment, tools, supplies, permits, signs and transportation necessary to perform” and complete the replacement of the bridge.
*252In July, 1985, Brode had purchased from Howard Quarries a quantity of rock to be used in the construction of the bridge. Howard had hired Alan Wilson who owned a dump truck to deliver the rock. On July 10,1985, Tumlinson, who had been hired by Wilson, was driving a Wilson truck to deliver the rock to Brode at the construction site. As Tumlinson drove his truck on to a Norfolk crossing about three and one-eighth miles from the construction site he collided with a Norfolk train. The crossing was about 2.2 post miles along the railroad from the construction site.
Tumlinson filed suit against Norfolk and Norfolk filed its third party petition which is the subject of this appeal. Norfolk later settled the Tumlinson law suit by paying $38,000 to Tumlinson and expended the sum of $24,024.91 in attorney fees and expenses. Thus, the suit in question sought the sum of $62,024.91 from Brode.
The theory of Norfolk’s third party petition was that Brode indemnified Norfolk for any damages Norfolk paid for claims arising out of or in connection with the work. Norfolk contends Brode had the obligation to furnish the transportation of materials to the construction site, and since Tumlinson was delivering rock for the construction, the accident arose out of and in connection with the rock.
The trial court found the contract to be ambiguous and admitted the testimony of W.M. Brode as to the meaning of the indemnification clause within the railroad construction industry. Brode testified that indemnity agreements such as the one in this case applied only to accidents or loss occurring within the project limits. He described the project limits here as being the railroad right-of-way line and each end of the bridge. The accident obviously took place well beyond those limits.
Norfolk did not offer any evidence contrary to the Brode testimony as to the generally accepted meaning of the indemnity agreement within the railroad construction industry.
Norfolk contends that the language of the agreement is clear and unambiguous. It contends that the language covers any accident occurring anywhere in the country involving transportation of material to the construction site if Norfolk were involved and were held liable for the accident. Brode also testified that steel for the construction project was shipped by rail from Ohio. During oral argument counsel for Norfolk contended that Brode would be liable under the indemnity agreement if an accident occurred anywhere between Ohio and the construction site during the transportation of the steel. It is possible to hypothesize situations which illustrate Norfolk’s theory. If the steel beams were loaded on Norfolk railroad cars and during shipment the beams came loose as the train passed over a highway and struck a bus carrying fifty people, Norfolk would have the right to have Brode indemnify it for all damages paid as a result of injury or death caused to the passengers. Norfolk contends the agreement is not ambiguous and the words used must be given their literal meaning. Norfolk says the words used do not limit the duty of Brode to indemnify to accidents occurring in any particular location. Norfolk concludes that Brode would be required to indemnify it for the accident just hypothesized.
In Sanders v. General Motors Acceptance Corp., 180 S.C. 138, 185 S.E. 180, 182[1] (1936), the court stated several general rules governing the construction of contracts. Among these:
‘Even an apparently unambiguous contract may be rendered ambiguous and open to construction if its words, taken literally, lead to absurdity or illegality when applied to the facts.’ (Quoting from Clappenback v. New York L. Ins. Co., 136 Wis. 626, 118 N.W. 245, 246, and 13 C.J., § 481.p.521.
The same rule is quoted in 17A C.J.S. Contracts § 294 P.36 (1963).
Sanders refused to give literal effect to a chattel mortgage which gave the mortgagee the right to seize a car on default and take all of the personal property therein. The court gave several examples of the absurd results which a literal reading of the mortgage would produce.
*253An absurdity is a result which is contrary to reason or which “could not be attributed to a man in his right senses.” The State v. Hayes, 81 Mo. 574, 585 (1884).
Brode contends that if the contract were read literally it would include the above stated hypothesis. This court finds that under the rule stated in Sanders the agreement in this case becomes ambiguous because the words taken literally lead to absurd results. It is difficult to imagine a more absurd result than to impose liability on Brode under the facts of the above mentioned hypothesis. Yet that is the result Norfolk contends is required under this agreement. Under the literal meaning of the words used, Brode was liable to Norfolk every time any material for the project began its journey to the site, regardless of the distance from the site. If Norfolk could become liable, then Brode could. Thus, the financial well being of Brode was placed on the line from the time the steel left Ohio until it reached the project limits if it were carried by Norfolk, or if a truck carrying it came into contact with a Norfolk train. The liability of Brode was completely at the mercy of the conduct of others who were acting without the knowledge or control of Brode.
The words of the indemnity taken literally lead to an absurd result which invokes the rule of ambiguity and which allows the court to construe the contract according to the intent of the parties. The only evidence of intent was the testimony of Brode that the indemnity agreement applied only within the project limits. The court did not misapply the law and the judgment is supported by the evidence.
The judgment is affirmed.
CLARK, J., concurs.
FENNER, J., dissents in separate dissenting opinion.