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Steele Foundations, Inc. v. Clark Construction Group

December 13, 2007

STEELE FOUNDATIONS, INC., APPELLANT/CROSS-APPELLEE,
v.
CLARK CONSTRUCTION GROUP, INC., APPELLEE/CROSS-APPELLANT.



Appeal from the Superior Court of the District of Columbia (CA-4213-00) (Hon. A. Franklin Burgess, Jr., Trial Judge).

The opinion of the court was delivered by: Ruiz, Associate Judge

Argued December 6, 2005

Before WASHINGTON, Chief Judge, RUIZ, Associate Judge, and KERN, Senior Judge.

This case involves cross-claims for indemnification between a contractor, appellee/cross-appellant, Clark Construction Group, Inc. (Clark), and its subcontractor, appellant/cross-appellee, Steele Foundations, Inc. (Steele). Both parties were sued by a worker injured on their construction site, and both settled the worker's claim before suing each other in the instant suit for indemnification. Clark's cross-claim, at issue on appeal,*fn1 is based on an indemnification clause in the parties' construction contract. The trial court found, as a matter of law, that under a provision of the indemnification clause, Steele was required to indemnify Clark for the amount of the settlement it reached with the injured worker and for the attorneys' fees incurred in responding to the worker's claim, notwithstanding the jury's verdict that Clark was not entitled to indemnification under a different provision of the indemnification clause. Steele appeals the trial court's determination that it is contractually bound to indemnify Clark. In a cross-appeal, Clark challenges the trial court's denial of its motion for judgment as a matter of law on the theory that the jury's verdict was inconsistent with the findings it made on the interrogatories on the verdict form. We affirm.*fn2

I.

Clark was the general contractor responsible for the construction of the Connecticut Park Apartments at 4411 Connecticut Ave., NW. Steele was the subcontractor on the project tasked with "lagging," or reinforcing, the excavation site. The injured worker, Mr. Inez Berrios, was employed by another subcontractor, and in his complaint he alleged that both his employer and a representative of Clark had told him, on the day he was injured, to help Steele excavate a trench along a wall of new excavation, which Steele was charged with reinforcing so it would not collapse. The wall did collapse, causing the worker serious injury and paralysis. Mr. Berrios sued his employer, Steele, Clark, and the owner of the property. All parties settled with Mr. Berrios. The present action between Steele and Clark went to trial on cross-claims for indemnification for their respective settlements with Mr. Berrios and associated attorneys' fees.

At the core of the parties' dispute on appeal are the first two sentences in the indemnification clause, section 6 (c) of the "Subcontract Agreement" between Steele and Clark. This section reads:

If any person (including employees of Subcontractor [Steele]) suffers injury or death or any property is damaged, lost or destroyed, as a result, in whole or in part, of Subcontractor's acts or omissions, whether or not involving negligence of Subcontractor, his employees, agents or lower-tier subcontractors, Subcontractor assumes the liability therefor and shall indemnify and hold harmless therefrom the Owner and Clark and their agents, servants, employees and sureties. With respect to any action involving Subcontractor's acts or omissions, (I) Subcontractor shall at its own expense defend Clark and all other indemnified parties, and (ii) Subcontractor shall pay all costs and expenses, including attorneys' fees, of, and satisfy all judgments entered against, Clark and all other indemnified parties. Nothing herein shall preclude Clark from participating in any such defense. Subcontractor's assumption of liability herein is in addition to assumption of all liabilities on account of or in any way related to Subcontractor's work which Clark has assumed under the Contract Documents or under agreements with third parties who may be affected by construction of the Project.*fn3

The parties agreed before trial that the first sentence of the indemnification clause required Steele (the subcontractor) to indemnify Clark (the contractor) only if there was a finding that Mr. Berrios's injuries resulted from an act or omission of Steele, and that the jury should decide that question. Therefore, causation was the primary focus of the trial. The meaning of the second sentence, on the other hand, was hotly contested, and the parties agreed that its interpretation was a question of law to be decided by the judge after the jury rendered its verdict.

The Trial and Post-Trial Proceedings Regarding the First Sentence of the Indemnity Clause

At trial, Clark called Douglas Verden as a witness. Verden was the superintendent for Clark on the job site at the time of the accident. Verden testified that on Monday morning, February 1, 1999, the day before the accident, he had expected Steele's crew to be at the work site, since he had told Steele's foreman, Mr. Hudler, the previous Friday that they would be needed that morning. Verden's crew worked over the weekend to excavate the site so it would be prepared for lagging by the Steele crew on Monday. However, Steele's crew did not show up as expected. When Verden complained about the crew's absence, Hudler told him that all of Steele's crews were busy that day, but that Verden should not be too concerned about the area the Steele crew was supposed to have lagged that day, since it was mostly rock and "it wasn't going to move." The following day, Tuesday, February 2, Steele's crew arrived, but did not begin the lagging work because it was raining. Later, Verden (on behalf of Clark) and a representative of Mr. Berrios's employer, Miller and Long, instructed Mr. Berrios to go to that area and shovel out some debris. While he was doing so, a portion of the wall of the excavated site collapsed, causing serious injury to Mr. Berrios.

Hudler, Steele's foreman, had been working for Steele for twenty-eight years. He testified that Verden did not tell him on Friday to come with a crew on Monday morning, February 1, 1999. Nevertheless, Hudler had gone by the worksite at about 5:30 or 6:00 a.m. that Monday morning on his own initiative to check whether the area was ready for lagging, and noticed that it was not, because it had not been "dug out." According to Hudler, he never spoke with Verden that day, and Verden was not at the worksite while Hudler was there. Hudler disputed that he told Verden not to worry about the lagging because the area was mostly rock and "it wasn't going anywhere." Hudler testified that the next day, when Mr. Berrios was injured, he was on his way to Florida on vacation.

The jury was instructed that it was "being asked to determine Clark's claim that it is entitled to indemnification from Steele under" the first sentence of the indemnification clause. On the special verdict form, a general verdict form with interrogatories pursuant to Superior Court Civil Rule 49 (b),*fn4 the jury was asked to ...


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