Court Opinion

ID: 8911228
Source: CourtListenerOpinion
Date Created: 2022-11-27 03:05:31.980505+00
Date Added: 2024-06-11T17:08:32.978551
License: Public Domain

GOLDBERG, Circuit Judge,
specially concurring:
I write to clarify the relationship between the court’s holding in this case and those of the prior decisions discussed in the majority opinion. In particular, I write to ensure that future potential indemnitors and indemnitees understand which steps will make proof of actual liability necessary, and those which will necessitate proof of potential liability.
I understand our present holding to be that a settling indemnitee can recover from an indemnitor upon proof of the indemni-tee’s potential liability if the settlement terms are reasonable and if the indemnitor has notice of the suit, has notice of the settlement terms, and has failed to object to those terms even though he has had a reasonable opportunity to approve or disapprove the settlement. Thus, when the in-demnitor has notice of the settlement terms, he has the burden of expressing his objection to that settlement. If he fails to object, he is liable for indemnity upon proof of potential liability. If he does object, however, he cannot be held liable for indemnity without proof of the indemnitee’s actual liability unless the indemnitee offers the defense of the action to him. See Whi-senant v. Brewster-Bartle Offshore Co., 446 F.2d 394, 403 (5th Cir. 1971). If the indem-nitee does offer the defense of the suit to the indemnitor, the indemnitor refuses this offer, and the indemnitee settles, then only proof of potential liability is required to obtain indemnification. See id.
I have great doubt that before the decision in this case Ripp “was certainly aware that the settlement of the claim against Reynolds would substantially affect the adjudication of the cross-claim for indemnity.” Majority Opinion, supra, 619 F.2d at 358. However, since I cannot affect the result in this case, I will not address this problem of the retroactive application of the rule announced in this case.