2011-00104475-CU-PO

Chris Anderson vs. AT&T Services Inc

Nature of Proceeding: Motion for Summary Judgment and/or Adjudication (ITC Service Group)

Filed By: Marchiano, David M.

Cross-Defendant ITC Service Group, Inc.’s (“ITC”) motion for summary judgment, or in
the alternative, summary adjudication, is ruled upon as follows.

Plaintiff Chris Anderson brought the instant action against AT&T, Glaus Pyle Schomer
Burns & Dehaven, Inc, dba GPD Associates (“GPD”) alleging that he was injured while
surveying cellular sites in June 2009 for his employer ITC. AT&T allegedly owned the
cellular towers and GPD coordinated the surveys and contracted with ITC to conduct
the surveys. GPD cross-complained against ITC for contractual and equitable
indemnity, contribution and declaratory relief. ITC seeks summary judgment on GPD’s
cross-complaint on the basis that the contract between ITC and GPD had no indemnity
language.

ITC’s separate statement includes the following. GPD alleges that it entered into a
written contract with ITC on March 9, 2009 whereby ITC agreed to provide services
including tower mapping of various locations in California. GPD alleges that the
contract contained an indemnity clause requiring ITC to indemnify, defend, and hold
GPD harmless for claims, damages, losses, and expenses, including attorneys’ fee
arising out of ITC’s negligence in the performance of the contracted services. The
March 9, 2009, contract references three locations: Brewer, Fresno, and Alder
Springs. The March 9, 2009, contract does not mention or reference the Laughlin
Ridge site in Willits where Plaintiff was injured, or the site survey project for which
Plaintiff was hired.

The March 9, 2009, contract was an hourly contract that provided for an hourly rate of
$60/hour to be paid to ITC upon completion. The contract was unrelated to the site
survey project for which plaintiff was hired. GPD does not allege the existence of any
other contract.

Plaintiff was hired by ITC on May 26, 2009, to perform surveying work at numerous cel
tower sites in Northern California (“site survey project”). On May 29, 2009, Mr.
Clements of GPD sent ITC an “AT&T Site Survey Project Scope” agreeing that GPD
would pay ITC $300 for each site visit completed with a list of sites to survey (“Scope
of Work”). The Scope of Work does not contain an indemnity provision. The Scope of
Work applied to the site survey project.

Plaintiff filed a workers’ compensation claim in connection with the alleged injury which
he ultimately settled.

First Cause of Action (Express Contractual Indemnity)

ITC seeks summary adjudication on the basis that there is no contract with an express
indemnity provision covering the work at the Laughlin Ridge Site, or the site survey
project for which Plaintiff was hired. ITC argues that the only document that governs
the site survey project for which plaintiff was hired is the Scope of Work. ITC’s
evidence shows that the March 9, 2009, contract, does not refer to the site survey
project for which Plaintiff was hired. Plaintiff was hired in late May 2009, to perform
surveying work at numerous cell tower sites in Northern California. Plaintiff alleges he
was injured while performing work at the Laughlin Ridge site in Willits.

The March 9, 2009 contract, which is for tower mapping as opposed to site surveying,
refers to three specific locations: Brewer, Fresno, and Alder Springs, none of which are
involved in the site survey project for which Plaintiff was hired. The March 9, contract
does not refer to the Laughlin Ridge site in Willits. The only document that refers to
the site survey project, the LOA , does not contain an indemnity provision, or even
refer to a contract that contains an indemnity provision. ITC’s evidence shows that the
very contract relied upon in connection with the first cause of action for express
indemnity does not relate to the site survey project for which Plaintiff was employed
and that GPD cannot establish a similar contract in connection with the site survey
project. ITC’s evidence is thus sufficient to shift to GPD the burden to establish a
triable issue of material fact.

GPD has met its burden. While GPD does not legitimately dispute that the March 9,
2009, contract does not pertain to the site survey project, it has produced evidence
raising a triable issue of material fact as to whether a contract exists with respect to the
site survey project that contains an express indemnity provision. The Court, however,
must first address GPD’s erroneous contentions. At the outset, to the extent that GPD
argues that its evidence establishes a triable issue of fact as to whether an implied-in-
fact contract was formed with respect to the Laughlin Ridge site in which ITC intended
to indemnify GPD, GPD is incorrect. If the evidence only established an implied-in-
fact, as opposed to an express written agreement, than the instant cause of action
would fail. Indeed, a cause of action for express indemnity is grounded upon an
obligation that only arises “by virtue of express contractual language establishing a
duty in one party to save another harmless upon the occurrence of specified
circumstances.” (Prince v. Pacific Gas & Electric Co. (2005) 45 Cal.4th 1151, 1120
[quoting Bay Development Ltd. v. Superior Court (1990) 50 Cal. 3d 1012, 1029]
[emphasis added].) Any cause of action seeking indemnity premised on a contract
implied-in-fact would not be seeking indemnity based upon any “express contractual
language” and thus would be a cause of action for equitable indemnity.” “There are
only two basic types of indemnity: express indemnity and equitable indemnity.
[citations omitted] Though not extinguished, implied contractual indemnity is now
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viewed simply as ‘a form of equitable indemnity.’” (Prince, supra, 45 Cal.4 at 1157.)
Nomenclature for the right of equitable indemnity has been a cumbersome matter in
our state’s jurisprudence. However, the California Supreme Court has also made it
reasonably clear that there are only two indemnity doctrines in California. One is
express contractual indemnity. The other may be called “implied” indemnity,
“equitable” indemnity, or “comparative” indemnity, or any combination of these terms
[see Bay Dev., Ltd. v. Superior Court (1990) 50 Cal. 3d 1012, 1028-1035.] Further, as
explained below in connection with the instant motion directed to the second through
fourth causes of action, GPD is not permitted to seek equitable indemnity from ITC.

As seen from GPD’s evidence, GPD’s project manager, who was involved in the
agreements between GPD and ITC to perform site audits and mapping services on cell
tower sites owned by AT&T and was familiar with the parties’ relationship, provides
evidence that the parties entered a subcontract covering the Laughlin Ridge site
containing an indemnity provision identical to the provision set forth in the March 9,
2009, contract. (Id. ¶¶ 4-8.) Indeed, Clements declares that it was the standard
practice of the two companies to have a written subcontract which included an express
indemnity provision and required ITC to obtain insurance naming GPD as an additional
insured. (Id. ¶ 4.)

Specifically, “GPD has a standard subcontract agreement template that is used with
ITC.” (Id.) The subcontracts were identical in terms of the indemnity and insurance
provisions that are contained in the March 9, 2009, subcontract. (Id. Exh. B.) On May
27, 2009, Clement received an email from Kevin Capps, Director of Sales at ITC, with
whom he regularly communicated. (Id. ¶ 6.) Capps inquired whether Clements would
“be providing a scope of work letter with your subcontract agreement” You and I know
what needs to be done but the ‘powers that be’ want to see it in writing.” (Id. ¶ 6, Exh.
D.) Clements declares that this email’s reference to the “subcontract” was a reference
to the contract for the Laughlin Ridge site where Plaintiff was injured. (Id. ¶ 6.) On
May 29, 2009, Clements prepared a Scope of Work letter entitled “AT&T Site Survey
Project Scope” which expressly referred to the Laughlin Ridge Site. (Id. ¶ 8, Exh, F.)
Clements declares that the letter was not a separate contract but rather prepared to
convey to ITC the scope of work for specific site locations for the contracted services
to be performed. Clements declares that it “would not have been standard practice to
include a provision for indemnity in such a letter; instead it would have been GPD’s
standard practice to execute a separate subcontract with indemnity provisions.” (Id. ¶
8.) In addition, ITC provided a certificate of insurance naming GPD as an additional
insured for the period of time from January 1, 2009, to January 1, 2010, which covers
the period during which Plaintiff was injured. (Id. Exh, E.) Again, while the actual
subcontract for the Laughlin Ridge site was not produced, Clements states that
“because the standard practice of GPD and ITC at that time was to transmit some of
those documents via facsimile, some of the subcontracts were not saved
electronically. Although GPD continues to attempt to locate the specific document for
the work at the Laughlin Ridge site, it has not yet been able to locate that
subcontract.” (Id. ¶ 6.) Further, ITC’s discovery responses make clear that it
contracted with GPD to provide site surveys at various AT&T cell sites throughout
California. (Riddell Decl. ¶ 2, Exh. A [ITC’s response to GPD’s special interrogatory
#4].) The above evidence creates a triable issue of material fact with respect to whether ITC
and GPD entered into a written contract with respect to the site where Plaintiff was
allegedly injured that contained an express indemnity provision. Indeed, while GPD
has not been able to date to locate the specific contract, the evidence set forth above,
if credited by a trier of fact could lead to the reasonable conclusion that ITC and GPD
entered into a contract which covered the subject site. Indeed, the evidence shows
that the parties contracted for ITC to provide site surveys, and the parties entered into
a number of standard subcontracts for other specific projects containing standard
express indemnity provisions. This evidence leads to an inference that the work
performed at the Laughlin Site was performed pursuant to a written contract containing
an express indemnity provision. This inference is bolstered by the evidence of the
parties’ communications. Specifically, ITC’s Director of Sales emailed Clements at
inquiring whether a scope of work for the AT&T Mobility Site Survey would be provided
with the subcontract agreement, which Clements declares was in reference to the
Laughlin Site. Further, two days later, Clements sent the Scope of Work Letter to ITC
which both parties agree referred to the Laughlin Site. Clements even accounts for the
inability to produce the actual subcontract based on the then-standard practice of
faxing documents without saving them electronically. Putting the communications
together with the course of dealing between the parties’ and Clements’ explanation of
GPD’s inability to locate the specific subcontract, presents the inference that such an
express agreement exists, and could lead a reasonable trier of fact to find that the
parties entered into a written contract that contained an express indemnity provision.
As a result, there are triable issues of material fact and the motion for summary
adjudication as to the first cause of action is denied.

While ITC argues in reply that GPD concedes that no contract exists for the subject
project, it did not so concede. Rather its evidence shows that it has been unable to
locate the specific contract to date, given the fact that the standard practice at the
relevant time was to fax documents between the parties and not save them
electronically. (Clements Decl. ¶ 6.) An inability to locate a written document is not a
concession that one never existed. GPD’s evidence is sufficient to demonstrate a
triable issue of material fact as to whether there was a contract for the subject project
containing an express indemnity provision.

Second, Third, and Fourth Causes of Action (Implied Contractual Indemnity,
Contribution and Implied Equitable Indemnity)

ITC moves for summary adjudication of these implied equitable indemnity based
causes of action on the basis that they are unavailable as a basis for indemnity as a
result of Labor Code § 3864. A third party is barred from seeking implied or equitable
indemnity from a plaintiff’s employer when the plaintiff’s injury occurred in the plaintiff’s
scope of employment. “Section 3864 enforces the exclusivity of workers’
compensation by precluding concurrent tortfeasors from seeking indemnification from
negligent employers absent a written agreement executed prior to the injury.” (
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Employers Mutual Liability Ins. Co. v. Tutor-Saliba Corp. (1998) 17 Cal.4 632, 638.)
Section 3864 was enacted to “abolish any right to indemnity other than by express
contract.” (Id.) ITC’s evidence shows that it employed Plaintiff at the time of the
alleged injury and that the injury occurred in the scope of that employment. (UMF 19;
Sauer Decl. ¶ 4.) Indeed, Plaintiff filed a workers’ compensation claim in connection
with the alleged injury and ultimately settled the claim and received compensation.
(UMF 36, 37; Anderson Depo. 39:16-19, 42:25-43:9.) ITC’s evidence shows that
plaintiff’s injury occurred in the scope of his employment with ITC and thus that GPD cannot obtain any form of equitable indemnity from ITC pursuant to Labor Code §
3864.

GPD’s opposition fails to demonstrate a triable issue of material fact. Indeed, it does
not dispute the fact that Plaintiff’s injury occurred in the scope of his employment with
ITC. Rather, it argues that there is a triable issue of fact as to whether a contract
exists. That argument is of no moment, and misses the point as Labor Code § 3864
makes clear that the only form of indemnity that is permitted is one for express
contractual indemnity. Thus, whether a triable issue exists with respect to whether an
express contractual indemnity provision exists has no bearing on these implied
equitable indemnity causes of action, all of which are rendered unavailable pursuant to
Labor Code § 3864. That is, even if GPD is correct, that would not permit it to proceed
on equitable or implied indemnity causes of action, only on an express contractual
indemnity cause of action. Further, the fact that there is no judgment yet finding that
Plaintiff was injured due to GPD’s negligence is irrelevant as Labor Code § 3864
“preclud[es] concurrent tortfeasors from seeking indemnification from negligent
employers absent a written agreement executed prior to the injury.” (Employers
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Mutual Liability Ins. Co., supra, 17 Cal.4 at 638.) ITC need not wait until a judgment
is rendered against GPD to raise the Labor Code § 3864 argument. GPD also
suggests that somehow Labor Code § 3864 does not apply to a contribution cause of
action. GPD is wrong. Simply put, “no cause of action may be maintained against the
employer (ITC) for implied or equitable indemnity or contribution, but only on the
basis of an express indemnity agreement.” (Ralph M. Parsons Co. v. Combustion
Equipment Associates (1985) 172 Cal.App.3d 211, 216 fn.2 [emphasis added].) The
second, third, and fourth causes of action are all causes of action for implied and
equitable indemnity or contribution and are thus precluded by Labor Code § 3864.

The Court also notes that GPD appears to argue that if it were to establish a triable
issue of fact as to whether there was an implied in fact contract between itself and ITC,
then its equitable indemnity claims should be allowed to proceed. This is incorrect.
Again, where, as here, the plaintiff’s injuries occurred in the course of the plaintiff’s
employment, Labor Code § 3864 precludes all forms of indemnity except indemnity
based upon an express indemnity agreement. (Ralph M. Parsons, supra, 172
Cal.App.3d at 216, fn.2.)

GPD also attempts to argue very briefly that Labor Code § 3864 does not apply to its
fourth cause of action for implied equitable indemnity as it is based upon CCP §
1021.6. However, whether GPD classifies the fourth cause of action as based upon
CCP § 1021.6 or the “tort of another” doctrine, the result is the same. CCP § 1021.6
merely allows for the recovery of attorneys’ fees when a party has prevailed on a claim
for implied indemnity where the party was required by the tort of the indemnitor to bring
or defend an action. (CCP § 1021.6.) “Apparently, the Legislature agreed with Justice
Mosk, adopting some-but not all-of the language he quoted from Prentice, supra, as
the basis of section 1021.6. [citations omitted]. But the Legislature also appears to
have adopted Justice Mosk’s characterization of the ‘tort of another’ doctrine as just
another form of ‘implied indemnity.’” (John Hancock Mutual Life Ins. Co. v. Setser
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( 1996) 42 Cal.App.4 1524, 1533.) One can only recover attorneys’ fees pursuant to
CCP § 1021.6 pursuant to a claim for implied indemnity. ( Watson v. Department of
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Transportation (1998) 68 Cal.App.4 885, 895 [“we conclude there is no ‘claim for
implied indemnity’ on which Watson could be deemed to have prevailed, hence,
section 1021.6 is inapplicable”].) In sum, whether GDP views its fourth cause of
action, or any other cause of action for that matter based upon CCP §1021.6 or the tort
of another doctrine, it is still one for implied indemnity and as discussed above, not
permitted under Labor Code § 3864.

As a result, ITC’s motion for summary adjudication as to the second, third and fourth
causes of action, all which seek a form of implied or equitable or comparative
indemnity, is granted, in as much as those causes of action are barred by Labor Code
§ 3864.

Fifth Cause of Action (Declaratory Relief)

ITC’s motion is denied. Here, ITC argues that it is entitled to summary adjudication
because there is no actual controversy between the parties based on the fact that
GPD “is incapable of seeking express or equitable indemnity against ITC, as
established above.” (Mot. 8:19-20.) However, given that the Court determined that
there is a triable issue of material fact in connection with whether GPD can seek
express contractual indemnity from ITC, there is necessarily a triable issue of fact with
respect to the fifth cause of action for declaratory relief. As a result the motion is
denied.

In sum, the motion for summary adjudication is denied as to the first and fifth causes of
action and granted as to the second, third and fourth causes of action.

Having failed to obtain summary adjudication on all causes of action asserted against
it in GPD’s cross-complaint, ITC’s motion for summary judgment is denied.

The notice of motion does not provide notice of the Court’s tentative ruling system as
required by Local Rule 1.06(D). ITC’s counsel is ordered to notify GPD’s counsel
immediately of the tentative ruling system and to be available at the hearing, in person
or by telephone, in the event GPD’s counsel appears without following the procedures
set forth in Local Rule 1.06(B).

GPD’s counsel shall prepare for the Court’s signature and order pursuant to CCP §
437c(g) and CRC Rule 3.1312.