SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY OF LOS ANGELES – NORTH DISTRICT

STEVEN EARLY and MELANIE EARLY, )
) Case Number MC 024111
Plaintiff, )
) ORDER AFTER HEARING
V )
) Date of Hearing:
NORTHROP GRUMMAN CORP.,; ) April 22, 2014
NORTHROP GRUMMAN AEROSPACE ) Dept. A-11
SYSTEMS; NORTHROP GRUMMAN ) Judge Randolph A. Rogers
SYSTEMS CORPORATION; )
CHRISTOJOHN SAMUEL, M.D.,; )
JAWAD BERMANI, M.D.; ABDALLAH )
S. FARRUKH, M.D.; PAUL N. )
MOGANNAM, M.D.; RAYMOND CHO, )
M.D.; THOMAS J. LEE, M.D.; P. )
DOUGLAS KIESTER, M.D.; )
ANTELOPE VALLEY HOSPITAL; )
ANTELOPE VALLEY HEALTHCARE )
DISTRICT, and DOES 1 to 20, )
)
Defendants )
)
____________________________________)

The Court bases the Order After Hearing of this date upon the following Statement of Decision:

1. This is an unlimited jurisdiction negligence, premises liability, professional negligence case in which Plaintiff Steven Early (“Plaintiff”) sustained injuries on a site controlled by the Northrop Grumman defendants, while operating a vehicle. Plaintiff was taken to Defendant Antelope Valley Hospital, and discharged. Plaintiff was later diagnosed with a cervical spine fracture, which required a surgical procedure.

2. On February 21, 2013, Plaintiff filed his complaint for (1) negligence, (2) premises liability, and (3) (professional) negligence (as against non-Northrop Defendants). The premises liability cause of action was dismissed with prejudice on January 16, 2014 by Plaintiffs.

3. On January 31, 2014, Defendant filed its motion for summary judgment, alleging that under the terms of the indemnification clause incorporated into purchase order no. 2802095 (“Purchase Order”), executed February 1, 2012, Plaintiff is contractually obliged to indemnify Defendant for any injuries not directly and solely attributable to Defendant’s negligence. Therefore, Defendant argues that it is entitled to summary judgment as a matter of law.

4. Plaintiff filed his opposition to Defendant’s motion for summary judgment on April 8, 2014, contending that the indemnity clause, to the extent that it was incorporated in the Purchase Order, was a standard third-party indemnification clause that does not cover indemnification in a two-party situation. In addition, construing the clause to be a release and waiver would be unconscionable and the clause is ambiguous as to the interpretation proffered by Defendant. Finally, there are material facts in dispute which preclude summary judgment.

5. Standard for summary judgment or summary adjudication – A party may move for summary judgment in any action or proceeding if it is contended the action has no merit or that there is no defense to the action or proceeding. Cal. Code Civ. Proc. § 437c(a). To prevail on a motion for summary judgment, the evidence submitted must show there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Cal. Code Civ. Proc. § 437c(c). In other words, the opposing party cannot present contrary admissible evidence to raise a triable factual dispute.

6. It is uncontested that there are disputed facts. Defendant’s motion for summary judgment, memorandum of points and authorities page 6 (“taking as true that the GEM’s seatbelt was inoperable, which Northrop disputes”). However, Defendant contends, and Plaintiff agrees, that the present summary judgment motion can be adjudged as a matter of law without need to resort to the facts. Defendant motion is grounded in an interpretation of the indemnity clause that would, as a matter of law, preclude liability. Questions of contract interpretation are a question of law for the court to decide. City of Bell v Rizzo (2013) 220 Cal.App.4th 236, 248.

7. The Indemnity Clause – The disputed clause states, in its entirety,

Seller [Mr. Early] shall take all necessary precautions to prevent the occurrence of any injury (including causing death) of any persons, or of any damage to any property, arising out of acts or omissions of such agents, employees, or subcontractors; and, except to the extent that any such injury or damage is due directly and solely to Buyer’s [Northrop’s] negligence, Seller shall indemnify, defend, and hold Buyer, its officers, employees, and agents, harmless form any and all costs, losses, expense, damages, claims, suit, or any liability whatsoever, including attorney’s fees, arising out of any act or omission of Seller, its agents, employees, or subcontractors.

8. Under Civil Code §2772, an indemnity contract is defined as where “one engages to save another from a legal consequence of the conduct of one of the parties, or of some other person.” In general, “in indemnity contracts the engagement is to make good and save another from loss upon some obligation which he has incurred or is about to incur to a third person.” Goodman v. Severin (1969) 274 Cal.App.2d 855, 893. See also Myers Building Industries, Ltd. V. Interface Technology (1993) 13 Cal.App.4th 949, 968 (“An indemnitor in an indemnity contract generally undertakes to protect the indemnitee against loss or damage through liability to a third person”); Varco-Pruden, Inc. v. Hampshire Constr. Co. (1975) 50 Cal.App.3d 654, 660 (quoting the same language from the Goodman case). However, it is equally true that “each indemnity agreement is interpreted according to the language and contents of the contract as well as the intention of the parties as indicated by the contract. The extent of the duty to indemnify is determined from the contract . . . [and the provisions] are to be construed under the same rules governing other contracts with a view to determining the actual intent of the parties.” Wilshire-Doheny Associates, Ltd. V. Shapiro (2000) 83 Cal.App.4th 1380, 1396 (quoting Myers, supra 13 Cap.App.4th at 968-9) (internal citations omitted).

9. The present case is a two-party situation, where the indemnitor is suing the indemnitee, and is dissimilar from the typical three-party scenario. Defendant argues that the indemnity clause functions as a shield to Defendant’s liability as against any possible claimant, including the Plaintiff, essentially construing the indemnification clause as an exculpatory clause vis-à-vis the Plaintiff. Where this is the case, “courts must look for clear, unambiguous and explicit language not to hold the released party liable.” Queen Villas Homeowners Assn. v. TCB Property Management (2007) 149 Cal.App.4th 1, 5. See also Saenz v. Whitewater Voyages, Inc. (1991) 226 Cal.App.3d 758, 765 (“drafting a legally valid release is no easy task. Courts have criticized and struck down releases if the language is oversimplified, if a key word is noted in the title but not the text, and if the release is too lengthy or too general. . . . It suffices that a release be clear, unambiguous, and explicit, and that it express an agreement not to hold the released party liable for negligence”).

10. Thus, for example, in Wilshire-Doheny Associates, Ltd. v. Shapiro, supra 83 Cal.App.4th 1380, the court found that attorney’s fees could be awarded under an indemnification clause in an action brought by the indemnitor because the indemnification clause “specifically applies to an action or suit by or in the right of the [indemnitor] to procure a judgment in its favor.” Id. at 1396. Similarly, in Dream Theater, Inc. v. Dream Theater (2004) 124 Cal.App.4th 547, the court found the indemnification clause to apply in a two-party situation where interpreting the contractual provisions otherwise would have created asymmetrical indemnification rights (where there is express language committing one party to indemnify against third party and first party breaches). Id. at 555.

11. These cases, however, are distinguishable from the present case. In contrast to the cases cited above, where there was clear indication by the terms of the contract that the indemnity clauses were intended to apply in a two-party situation, the terms of the present contract does not appear to have such language. Indeed, the present contract seems more akin to that in Queen Villas Homeowners Association v. TCB Property Management, supra.

12. In Queens Villas, the homeowner’s association and a property management company became embroiled in a dispute over failure to perform. The property management company brought a summary judgment motion arguing that the indemnity clause between itself and the association meant the association could not maintain its cause of action against the company. Id. at 3-4. The clause in question stated that the “Association agrees to indemnify, defend and hold agent and its employees . . . harmless against any and all claims, costs, suits, and damages, including attorneys fees arising out of the performance of this agreement or in connection with the management and operation of the Association, including claims, damages, and liabilities for injuries suffered, or occurrences of death or property damage relating to the property, excluding any claims or liabilities arising out of the sole negligence or willful misconduct of Agent or its employees.” Id. at 4.

13. Under these facts, the appellate court reversed the trial court’s grant of the property management company’s motion for summary judgment, finding “no indicia . . . that would require a court to interpret [the clause] . . . beyond the usual context of third party indemnification.” Id. at 7. Indeed, the Court went as far as to state that the “sole negligence” language “points the reader to the fact that there will be, at least in theory, situations where the property management company might not be indemnified if it were sued by a third party.” Id. at 8 (bold added).

14. The facts here mirror those in Queens Villas. An indemnity clause similar to that in Queens, even containing substantially similar “sole negligence” language is being used as grounds for summary judgment. The moving party is attempting to urge an exculpatory, two-party construction of the clause. The “terms of the commercial reality or the benefit of the bargain” do not indicate contemplation beyond the ordinary third party context. The contract does not have express language similar to that found in Wilshire-Doheny and Dream Theatre. Under these facts, Defendant is not entitled to summary judgment as a matter of law in its favor against the Plaintiff.

15. Based on the foregoing, the motion for summary judgment is DENIED.

SO ORDERED AND ADJUDGED this the ______ day of April, 2014.

___________________________________
RANDOLPH A. ROGERS, JUDGE