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OHIO CAS. INS. CO. v. BANK BLDG. & EQUIP. CORP. OF

June 17, 1968

OHIO CASUALTY INSURANCE COMPANY (VENANGO FEDERAL SAVINGS AND LOAN)
v.
BANK BUILDING AND EQUIPMENT CORPORATION OF AMERICA. The OHIO CASUALTY INSURANCE COMPANY (GRANNIS) v. BANK BUILDING AND EQUIPMENT CORPORATION OF AMERICA



The opinion of the court was delivered by: WEBER

 These two consolidated actions seek indemnity on behalf of the insurance carrier of two parties who were found jointly liable for damages for the death of Charles Grove, an employee of the present defendant, in Civil Action No. 86-65 Erie in this Court. The present defendant was not made a party to that action. The circumstances of the liability imposed in that case are set forth in the opinion in the action of Wagner, Admrx. of Grove v. Grannis, Venango Federal Savings and Loan et al., reported in 287 F. Supp. 18.

 The present claims of indemnity are based both on an express contract of indemnity between the defendant and Venango, under which Grannis claims as a third-party beneficiary, and on the basis of a common law right of indemnity asserted by both parties on the grounds of restitution because of payment of an obligation for which the present defendant is alleged to be primarily liable.

 All parties have moved for summary judgment. It has been stipulated that the record of the action at Civil Action No. 86-65 Erie shall constitute part of the record of this action for the purpose of these motions.

 There can be no doubt from the record of the former action that the proximate cause of the accident which caused the death of Grove was the active negligence of the present defendant. It was the contractor which was working at the site constructing a new building for Venango. It was excavating for footers for the new building at the base of the foundation of the old building, and undercutting the old building walls and failing to observe many building practices which were called for under the circumstances. The deceased was the employee of the defendant who was directly engaged in this work.

 Although these two actions are being maintained by insurance carriers on behalf of the defendants in the former action, it is by coincidence that the same carrier represented both parties. For convenience we will continue to designate each plaintiff by the name of the insured in each action, Venango and Grannis.

 Venango desired to build a new bank building. It engaged defendant, a specialist in planning, design and construction of bank building and related facilities, to render planning services. It was decided that the new building should be built on part of the site of an old hotel building. Grannis, a lawyer, and Venango, agreed to buy the old hotel building, and with the advice of defendant, to divide the building at the location of an interior wall, with Grannis retaining title to the part which was to remain standing, and Venango taking title to the portion which was demolished to prepare for the site of the new building. Venango entered into a construction contract with defendant for construction of its new building, one wall of which would follow the property line dividing the Grannis and Venango tracts and be adjacent to the newly created exterior wall of the old building retained by Grannis. While excavating for foundations for the wall of the new building defendant undercut the supporting earth of the wall of the old building and also cut into the wall of the old building for the purpose of placing underpinning and support. In the course of these operations the old wall collapsed, killing Grove, defendant's workman.

 The building contract between defendant and Venango contained the following express provision:

 
"1B. UNDERPINNING
 
General Requirements.
 
(a) The Contractor under this section of the specifications shall take precautions to guard against movement or settlement of adjacent building, provide and place bracing or shoring necessary or proper in connection herewith, be responsible for the safety and support of such building, be liable for any movement or settlement and any damage or injury caused thereby or resulting therefrom. If at any time the safety of the adjacent building appears to be in danger, cease operation, notify the Architect, take precautions to support the building and do not resume operation until permission has been granted."

 While not denying the express provisions of the indemnity clause, defendant argues that they cannot be construed as indemnifying Venango against its own negligence, and that the record of the prior action supported a finding of liability against Venango for independent acts of negligence committed by it. Defendant cites Pittsburgh Steel Co. v. Patterson-Emerson-Comstock Co., 404 Pa. 53, 171 A.2d 185 [1961], as holding:

 
"However, the law is well settled that the intention to include within the scope of an indemnity contract, a loss due to the indemnitee's own negligence, must be expressed in clear and ...

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