Bison Builders Inc. v. ThyssenKrupp Elevator Corporation (2012)

September 24, 2012

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In this indemnity dispute, Horvitz & Levy LLP persuaded the California Court of Appeal to affirm a judgment in favor of our client, ThyssenKrupp Elevator Corporation (TKE).

TKE was hired by Bison Builders, a general contractor, to install elevators at a hotel constructed by Bison. In a personal injury action against Bison, TKE employee David Travis asserted that Bison provided inadequate access and inadequate lighting at the entrance to the hotel construction site. As a result, Travis had to duck under scaffold cross-bracing each time he entered the hotel, often while carrying heavy equipment. Travis struck his head on the cross-bracing several times, allegedly sustaining severe orthopedic injuries to his neck.

In a cross-action, Bison contended that the terms of an indemnity agreement between TKE and Bison entitled it to recover indemnity and defense costs arising from Travis’s personal injury action.

A jury returned a verdict in favor of Travis for approximately $12 million, allocating 75% of the fault to Bison, 20% to TKE, and 5% to Travis. In the indemnity action, the trial court ruled that Bison was not entitled to indemnity or defense costs.

TKE retained Horvitz & Levy to consult with its trial counsel during proceedings in the trial court and to represent it when Bison appealed from the judgment in favor of TKE on the indemnity cross-complaint. On appeal, we argued that the trial court ruling was correct because the agreement at issue specifically provided that TKE was obligated to provide indemnity only to the extent that its acts and omissions caused injury. We also relied on a line of authority holding that unless an indemnity agreement specifically states that the indemnitor will provide indemnity for the indemnitee’s negligence, an actively-negligent indemnitee cannot recover indemnity.

The Court of Appeal (First Appellate District, Division Five) agreed with our arguments and affirmed the judgment in favor of TKE. The court also held that Bison waived its appellate argument on the defense cost issue by failing to explain in its briefing why the language in the indemnity agreement entitled it to recover defense costs. The court further held that even if Bison had not waived the defense cost issue, Bison was not entitled to recover its defense costs because Travis’s complaint against Bison alleged claims arising solely out of Bison’s negligence. Finally, the court ordered that TKE shall recover its fees on appeal.