Free Motion for Summary Judgment - District Court of Arizona - Arizona

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FENNEMORE CRAIG A Professional Corporation William L. Thorpe (005641) Sal J. Rivera (No. 016728) Melissa W. Rawlinson (No. 021285) 3003 North Central Avenue Suite 2600 Phoenix, Arizona 85012-2913 Telephone: (602) 916-5000 [email protected] [email protected] [email protected] Attorneys for BNSF

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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA Steve Schrum, Plaintiff, v. Burlington Northern and Santa Fe Railway Company, a Delaware corporation, and subsidiary of Burlington Northern and Santa Fe Corporation, a Delaware corporation, Defendant. The Burlington Northern Santa Fe Railway Company, a corporation, Third Party Plaintiff, v. Chemical Lime Company of Arizona, a corporation; ABC Corporations I-IV, fictitious corporations, Third Party Defendants, Pursuant to Rule 56, Fed. R. Civ. P., BNSF Railway Co. ("BNSF") moves for summary judgment on its indemnification claim against third-party defendant Chemical
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No. CIV04-619-PHX-RCB MOTION FOR SUMMARY JUDGMENT ON BNSF'S INDEMNIFICATION CLAIM AGAINST THIRD-PARTY DEFENDANT CHEMICAL LIME COMPANY

(Oral Argument Requested)

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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

Lime Company ("Chemical Lime"). The valid and binding Industry Track Agreement (the "Track Agreement") between BNSF and Chemical Lime clearly requires Chemical Lime to defend and indemnify BNSF in this matter. Chemical Lime has nonetheless refused BNSF's repeated requests that Chemical Lime do so. The Court should therefore grant summary judgment on this issue. BNSF' motion is supported by the following s Memorandum of Points and Authorities and separately filed Statement of Facts. MEMORANDUM OF POINTS AND AUTHORITIES I. Introduction Pursuant to the Track Agreement, BNSF operated an industry railroad track at Chemical Lime' Nelson Arizona plant (the "Plant"). (SOF, ¶ 1.) Plaintiff worked on s trains that provided railroad service to the Plant. (SOF ¶ 2.) Plaintiff sued BNSF under the Federal Employers Liability Act, 45 U.S.C. § 51 et. seq. ("FELA") for damages allegedly sustained while working at the Plant. (SOF, ¶ 3.) The Track Agreement

explicitly requires Chemical Lime to indemnify BNSF for any and all FELA claims. (SOF, ¶¶ 5-9.) Plaintiff unambiguously testified that all of his claims relate to the

conditions at the Plant. (SOF, ¶ 10.) Thus, plaintiff' claims fall squarely within the s indemnification provisions of the Track Agreement, and Chemical Lime is required to defend and indemnify BNSF for plaintiff' claims. s II. Factual Background BNSF and Chemical Lime entered into the Track Agreement, whereby BNSF provided rail service to the Plant and Chemical Lime granted BNSF a right of way for tracks, paid the costs of operating and maintaining the railroad, and agreed to defend and indemnify BNSF for any and all liability or claimed liability arising from or relating to the Plant. (SOF, ¶ 5.) Significantly, the Track Agreement also requires Chemical Lime to indemnify BNSF for all FELA claims arising from the Plant: (b)
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Regardless of any negligence or alleged negligence of
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[BNSF], [Chemical Lime] shall indemnify and hold harmless [BNSF] from any liability or claimed liability arising under the Federal Employers Liability Act (45 U.S.C. § 51, et. seq.) for any incident caused, wholly or in part, by property, equipment, fixtures or conditions belonging to or under the control of [Chemical Lime]. (SOF, ¶ 7.) The Track Agreement also confirms that BNSF' right to indemnification s shall be binding against Chemical Lime "regardless of negligence (whether active, passive, derivative, joint, concurring or comparative) on the part of" BNSF. (SOF, ¶ 8.) Finally, paragraph 8 of the Track Agreement provides that Chemical Lime is required to defend BNSF and "pay all the costs incident to such defense including, but not limited to, attorneys' fees, investigators' fees, litigation expenses, settlement payments, and amounts paid in satisfaction of judgments." (SOF, ¶ 9.) BNSF provided written notice of its tender of defense to Chemical Lime on several occasions. (SOF, ¶¶ 11-14.) To date, Chemical Lime has not accepted BNSF' tender of s defense, despite the clear contractual language set forth above. (SOF, ¶ 15.) A. Plaintiff confirmed that his claims arise out of conditions at the Plant.

During his deposition, plaintiff testified that his claims are based entirely on his employment at the Plant. Q: But again, just so we are on the same page on a moving-forward basis, all of these alleged exposures that you are complaining about occurred at the Chemical Lime plant; correct? A: Yes.

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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

Q: In other words, it wasn' your work in San Bernardino t that you contend made you ill in some manner, and that is at issue in this case? A: I believe that the lime dust exposure and the coal and coke dust exposure from Chemical Lime is what has hurt me more than anything else. Q: Okay. And all of those claims arise out of the exposures that occurred at the Chemical Lime plant; correct?
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PROFESSIONAL CORPORATION P HOENIX

A: (SOF, ¶ 10.) III.

Yes.

Pursuant to the Track Agreement, Chemical Lime agreed to defend and indemnify BNSF. The extent of a contractual duty to indemnify must be determined from the

agreement. Superior Companies v. Kaiser Cement Corp., 152 Ariz. 575, 577, 733 P.2d 1158, 1160 (App. 1986); Estes Co. v. Aztec Constr., Inc., 139 Ariz. 166, 168, 677 P.2d 939, 941 (App. 1983). A court must give effect to an indemnification contract where parties bind themselves by a lawful contract and the terms of the contract are clear and unambiguous. Isaak v. Massachusetts Indemn. Life Ins. Co., 127 Ariz. 581, 623 P.2d 11 (1981); Dutch Inns of America, Inc. v. Horizon Corp., 18 Ariz. App. 116, 500 P.2d 901 (1972). Chemical Lime clearly and unambiguously agreed to defend and indemnify BNSF. In the Track Agreement, Chemical Lime agreed to defend and indemnify BNSF in FELA lawsuits "for any incident caused, wholly or in part, by property, equipment, fixtures or conditions belonging to or under the control of" Chemical Lime. Here,

plaintiff is asserting FELA claims for injuries allegedly arising from conditions at the Plant. Indeed, plaintiff testified at deposition that his claims are based entirely on alleged exposures that occurred at the Plant. (SOF, ¶ 10.) Chemical Lime is contractually

obligated to defend and indemnify BNSF from plaintiff' claims. s BNSF is entitled to indemnification even if it was negligent.1 Arizona courts have held that indemnity contracts will protect an indemnitee against its own negligence where the indemnitor's obligation to do so is expressed in clear and unequivocal terms. See,
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BNSF vehemently denies that it was negligent or that plaintiff' alleged injuries relate to his BNSF s employment. Indeed, the only credible medical evidence offered in this case confirms that plaintiff' s alleged injury, asthma, preexisted his BNSF employment and is not related to his BNSF employment. In fact, BNSF has filed a separate motion for summary judgment on all of plaintiff' claims. The point here s is that Chemical Lime has a duty to defend and indemnify BNSF and it has failed to do so.
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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

e.g., Washington Elementary School Dist. No. 6 v. Balino Corp., 169 Ariz. 58, 61, 817 P.2d 3, 6 (1991). In this case, Article I, Section 4(b) of the Track Agreement provides, Regardless of any negligence or alleged negligence of [BNSF], [Chemical Lime] shall indemnify and hold harmless [BNSF] from any liability or claimed liability arising under the Federal Employees Liability Act (45 U.S.C. Sec. 51 et. seq. for any incident caused wholly or in party, by property, equipment, fixtures, or condition belonging to or under the control of [Chemical Lime]. (SOF, ¶ 7.) (Emphasis added.) Moreover, the Track Agreement provides, "[i]t is the intention of the parties that [BNSF]' right to indemnity contained in Sections 4(b), 5(e), s and 6(a) shall be valid and enforceable against [Chemical Lime] regardless of negligence (whether active, passive, derivative, joint, concurring or comparative) on the part of [BNSF], its officers, agents and employes [sic]." (SOF, ¶ 8.) BNSF was not negligent and did not cause plaintiff' alleged injuries. 2 Nevertheless, even assuming for the sake of s argument that it was, the "clear and unequivocal terms" of the Track Agreement entitle BNSF to indemnification in this case. Plaintiff' claim squarely falls under the express indemnification language in the s parties' Track Agreement. BNSF is therefore entitled to summary judgment on its

indemnification claim against Chemical Lime. IV. Conclusion For the foregoing reasons, BNSF requests this Court grant its motion for summary judgment on its indemnification claim against Chemical Lime. /// /// /// /// ///
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See separately filed motion for summary judgment on plaintiff' claims. s

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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

RESPECTFULLY SUBMITTED this 17th day of January, 2006. FENNEMORE CRAIG, P.C.

By s/Melissa W. Rawlinson William L. Thorpe Sal J. Rivera Melissa W. Rawlinson Attorneys for BNSF

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CERTIFICATE OF SERVICE I hereby certify that on January 17, 2006, I electronically transmitted the attached document to the Clerk' Office using the CM/ECF System for s filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: George T. Brugess Hoey & Farina, P.C. 542 S. Dearborn, Suite 200 Chicago, IL 60605 Attorneys for Plaintiff Charles D. Onofry ReNae A. Nachman Schneider & Onofry, P.C. 3101 N. Central Ave., Ste. 600 Phoenix, AZ 85012 Attorneys for Third-Party Defendant Chemical Lime I hereby certify that on January 17, 2006, I served the attached document by facsimile and U.S. mail on the following, who are not registered participants of the CM/ECF System: William D. Black One East Camelback Road Suite 630 Phoenix, Arizona 85012-1658

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F ENNEMORE C RAIG
PROFESSIONAL CORPORATION P HOENIX

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