Court Opinion

ID: 9606750
Source: CourtListenerOpinion
Date Created: 2023-08-22 02:52:15.523795+00
Date Added: 2024-06-11T15:17:33.871233
License: Public Domain

MATTHEWS, Justice,
with whom, RABINOWITZ, Chief Justice, joins, dissenting.
On appeal from the grant of a summary judgment we accept as true that version of the facts advanced by the losing party. Frantz v. First Nat’l Bank of Anchorage, 584 P.2d 1125, 1126 (Alaska 1978). If, viewing the case from that perspective, the movant is not entitled to judgment as a matter of law, the case must be reversed. In the discussion that follows I set forth Martech’s version of the facts. If these facts are accepted as true, Ogden is not entitled to judgment on the grounds that the settlement agreement of November 10, 1988, released Ogden’s obligation to pay Cummins for the automatic switchgear.
According to Martech’s president, Ben Tisdale, there was a dispute between Mar-tech and Ogden concerning whether Mar-tech was obliged to supply the automatic switchgear. This dispute arose in July of 1988. Martech consistently took the position that the automatic switchgear was not necessary to the project, that Martech was not obligated to supply the automatic switchgear, and that Martech would not *1156pay for the automatic switchgear. This dispute continued through August and into September of 1988. Meanwhile Ogden’s engineers were working directly with Cum-mins to design automatic switchgear. After the design was finalized, the parties resolved the dispute. Ogden agreed to pay for the automatic switchgear and directed Martech to place an order for it.1
By a letter dated November 3, 1988, Ogden terminated its contract with Martech, claiming six material breaches on the part of Martech and, alternatively, claiming the right to terminate the contract for Ogden’s convenience. None of the claimed breaches entailed the previous switchgear controversy. The parties then negotiated a settlement agreement entitled Settlement Agreement Mutual Release and Waiver which was signed on November 10, 1988. Neither the switchgear nor Ogden’s obligation to pay for the switchgear — which had not yet been delivered — was mentioned in the settlement agreement or in the discussions leading up to the settlement agreement. At some point after the settlement agreement was signed, Ogden declined to accept delivery of the automatic switchgear and refused to pay for it. Cum-mins sued Martech for the switchgear; Martech filed a third-party claim for indemnity against Ogden. The trial court granted Ogden’s motion for summary judgment concerning Martech’s third-party claim, presumably on the basis that the claim is barred by the settlement agreement.2
An important aspect of the’ settlement agreement is that it contemplates certain *1157ongoing contractual obligations for both parties. The settlement agreement is, therefore, much more than merely a release of all claims. An agreement which both creates or confirms ongoing obligations and purports to release all past and future claims would, without more, be a contradiction in terms, because the parties would be left without any remedy for future breaches. The settlement agreement addresses this problem in two ways.
First, in the release clause, section 18 of the 22 section agreement, care is taken to limit application of the clause to listed claims and claims which are described in the past tense, that is, claims which “arose” on or prior to November 4, 1988. The key sentence of the release clause reads as follows:
The parties agree that this settlement is the compromise of their disputed claims referred to above and hereby agree and acknowledge that any other claims against each other, known or unknown, which arose on or prior to November 4, 1988, or which arose pursuant to the contract for past or future losses, expenses or claims of any nature whatsoever (including any liability pursuant to the contract which might have arisen in the future had the contract not been terminated) are forever abandoned, and any right to assert such additional claims for any damages whatsoever are hereby forever waived and barred. (Emphasis added.)3
Second, as to past work or services which have not been billed and as to future services arbitration remedies are provided in case of a dispute.
Ogden was not called upon to perform its promise to pay for the automatic switching equipment until after the date of the settlement agreement. Thus, Ogden did not breach its promise to make payment for the switchgear until after the date of the agreement. Consequently, Martech’s claim for indemnity did not arise on or prior to November 4, 1988, and therefore the claim was not released.4 Instead, under paragraph 5 of the agreement, payment for the automatic switchgear was uninvoiced work for which Ogden was required to pay or, in the event of a dispute, to submit to arbitration.
In footnote 10, Op. at 1151 n. 10, the court acknowledges that this conclusion is correct: “Indeed, an agreement by Ogden to purchase the switchgear would have made the switchgear an item subject to invoice and thus arbitrable under paragraph 5(d) of the settlement.” Since, under the view of the transaction most favorable to Martech, Ogden did agree to purchase the switchgear, we must, for summary judgment purposes, treat the switchgear as subject to resolution under paragraph 5 of the settlement agreement. This necessarily means that the claim has not been released.
*1158On remand there are various courses of action which might be taken to resolve the critical question of whether there was an agreement by Ogden to purchase the switchgear. The trial court could order the parties to arbitrate this question.5 Alternatively, since neither party has asked for arbitration, the question might be resolved after a trial by the court, either with or without a jury. As these options have not been briefed, I express no opinion on them. It seems plain, however, that the release provisions of the settlement agreement do not cover Ogden’s alleged agreement to pay for the automatic switchgear and that summary judgment on this basis was erroneously entered.
What remains is the court’s suggestion that Martech may be barred — by soine variant of the doctrine of res judicata — from litigating its claim because the claim was not arbitrated. Op. at 1152-53 n. 13. A sufficient answer to this contention is that Martech’s claim for indemnity is not a mandatory subject for arbitration until it ripens, that is until and unless Martech is required to pay Cummins. This view is supported by much authority in the litigation context.6
For the above reasons, the judgment of the superior court should be reversed and this case should be remanded for further proceedings.

. The majority opinion states: "It was never formally resolved who would pay for or take ownership of the switchgear." Opinion at 1147. Whether this question was resolved is a fact in dispute. By asserting that the question was not resolved, the majority is taking Ogden’s view of the facts rather than Martech’s.
Similarly, the majority rejects Tisdale’s affidavit which states that “Ogden agreed to pay for the switchgear” on the grounds that it is uncorroborated and insufficiently detailed. Id. at 1149-50 n. 7. The majority states regarding Tisdale’s affidavit ”[t]o create a genuine issue of material fact there must be more than a scintilla of contrary evidence." Id. I agree that sometimes testimony may be so internally inconsistent and in conflict with the apparently reliable evidence offered by the proponent of a summary judgment motion that it may not serve to create a genuine issue of material fact and thus defeat summary judgment. Yurioff v. American Honda Motor Co., 803 P.2d 386, 389 (Alaska 1990), was such a case. There the key issue was whether plaintiffs injury occurred on March 19 or March 20. The defendant moved for summary judgment on the ground that it took place on the 19th, offering clinic records, testimony that the records were accurate, and plaintiffs deposition testimony that the injury probably was suffered on the date indicated on the clinic records. In opposition, plaintiff cited another portion of his deposition where he had stated that he thought he was injured on March 20. We held that this self-contradictory statement was not evidence reasonably tending to dispute or contradict the “authentic documentation of the injury.” Id.
This case is unlike Yurioff for a number of reasons. First, Tisdale's affidavit is not self-contradictory. Second, the affidavit is not contradicted by documentary evidence. Third, the movant in this case, Ogden, did not attempt an evidentiary showing that there was no agreement that Ogden would pay for the switchgear. Instead, Ogden moved on the sole ground that regardless of any agreement the release clause of the settlement agreement barred Martech from litigating the switchgear dispute:
But for the Settlement Agreement, Mutual Release and Waiver, Ogden would be obliged to dispute the admissibility and credibility of Mr. Tisdale’s undocumented assertion at the end of paragraph 12 that Ogden agreed to pay for the switch gear.
Ogden’s Reply to Martech’s Opposition to Ogden’s Motion for Summary Judgment at 6 (emphasis added).
Ogden admittedly failed to address the factual issue concerning whether it had agreed to pay for the switchgear. Indeed, Ogden indicated how it would respond to the question if required to do so:
Ogden would contend, for example, that a directive, under the subcontract, was only that. It was not a promise to pay for work directed. A change order was a promise to pay. There was no change order.
Id. at 6 n. 1. Ogden, however, offered no evidence to this effect in support of its motion. The proponent of a summary judgment motion has the initial burden of establishing the absence of genuine issues of material fact. Ratcliff v. Security Nat'l Bank, 670 P.2d 1139, 1142 (Alaska 1983). Thus, since Ogden — the mov-ant — did not carry its initial burden of showing by admissible evidence that no agreement existed, the court errs by requiring Martech — the nonmovant — to produce evidence, a “scintilla” or otherwise, on the issue.

. That was the sole ground presented in Ogden’s memorandum filed in support of its summary judgment motion.

.The majority opinion quotes language from the release as follows:
1. "All liability from whatever damage”
2. "any damages whatsoever”
3. "claims of any nature whatsoever”
4. "arising from or relating to the subject contract"
5. "known or unknown, arising from or relating to the subject contract.”
Op. at 1151-52 & n. 11. However, use of the verb "arose” places these seemingly broad phrases in the past tense with November 4, 1988, as the reference date. The court acknowledges the parties’ use of the past tense, Op. at 1152 n. 12, but fails to give effect to the verb "arose” in construing the release language. The court points out that the two clauses in which "arose” appears are joined by the disjunctive "or.” Since both clauses are framed in the past tense, however, severing the clauses does not alter the tense of the release sentence. Yet, use of the disjunctive leads the court to conclude that "[t]he release then specifically encompasses 'claims of any nature whatsoever (including any liability pursuant to the contract which might have arisen in the future had the contract not been terminated).’ (Emphasis added.)” Id. From its use of emphasis, I take the court to rely in part on the highlighted parenthetical language in support of its reading of the release. Even the parenthetical clause, however, only further specifies the claims that are released, which claims are already limited by the use of the past tense.

.As a claim for indemnification, Martech’s claim does not actually arise until Martech is made to pay Cummins. See Providence Washington Ins. Co. v. McGee, 764 P.2d 712, 715 (Alaska 1988) (claim for contribution does not arise until claimant is made to pay more than his or her proportional share).

. As the majority opinion notes, Martech contended before the trial court that its claim was not subject to arbitration. However, Martech did not burn its bridges on this issue, as it also stated: “If this court ... decides the indemnification issue should be submitted to arbitration, the court can sever the indemnity action from the underlying action.... ’’

. It is generally accepted that the doctrine of res judicata bars only those claims that could have been brought at the time of prior litigation (i.e., only those claims that had arisen), DeNardo v. State, 740 P.2d 453, 455-56 (Alaska), cert. denied, 484 U.S. 919, 108 S.Ct. 277, 98 L.Ed.2d 239 (1987), and that a claim for indemnification does not arise until the party seeking indemnification becomes liable on the underlying obligation. See, e.g., Borchard v. Wefco, Inc., 112 Idaho 555, 559, 733 P.2d 776, 780 (1987); EBI/Orion Group v. State Compensation Ins. Fund, 240 Mont. 99, 782 P.2d 1276, 1279 (1989); Aetna Casualty & Sur. Co. v. Aztec Plumbing Corp., 106 Nev. 474, 796 P.2d 227, 229 (1990); Travelers Ins. Co. v. L. V. French Truck Serv., 770 P.2d 551, 555 (Okla.1988); Perry v. Pioneer Wholesale Supply Co., 681 P.2d 214, 218 (Utah 1984). A Michigan court and a Georgia court have applied these accepted rules together in concluding that litigation prior to the accrual of an indemnification claim does not bar litigation of the indemnification claim. Ranger Constr. Co. v. Robertshaw Controls Co., 158 Ga.App. 179, 279 S.E.2d 477, 480 (1981); Beck v. Westphal, 141 Mich.App. 136, 366 N.W.2d 217, 221 (1984).