Court: District Court of Appeal of Florida; April 12, 2012; Florida; State Appellate Court
Griswold Ready Mix Concrete, Inc. appeals a judgment awarding Pumpco, Inc. $69,378.39 in attorney’s fees and $65,000 in additional costs for a contractual indemnity claim. The additional costs reflect a settlement payment to Tony Reddick, who alleged negligence against both Griswold and Pumpco after being injured by a hose from a pump truck during concrete delivery. Griswold engaged Pumpco to lease a pump truck and operator, and a work order included an indemnification clause obligating Griswold to assume all risks and indemnify Pumpco against various claims, except those arising from Pumpco's intentional conduct.
Griswold challenged the indemnification provision, arguing it was void under section 725.06 of the Florida Statutes due to the absence of a monetary limitation on liability. The trial court upheld the provision, asserting the statute only applies to contracts involving property owners. However, the appellate court disagreed, interpreting section 725.06(1) to apply broadly to indemnification agreements among any combination of listed parties, requiring a monetary limit to be valid. As a result, the appellate court reversed the trial court's judgment and remanded the case for further proceedings.
The interpretation of section 725.06 is supported by the precedent set in A-T-O, Inc. v. Garcia, where the Third District found an indemnity agreement between a lessor and lessee of construction equipment unenforceable because it lacked a monetary limitation. In that case, the lessee was required to indemnify the lessor for damages from the lessor's negligence, but the court ruled the provision void under section 725.06 due to the absence of a dollar limit on liability. Similarly, the indemnity provision in the current case concerning Griswold is also void for not including such a limitation. The trial court's ruling to the contrary is deemed an error, leading to a reversal of the judgment and a remand for further proceedings. The court further clarifies that section 725.06 applies broadly to any indemnity agreements within the specified parties, emphasizing that the indication of “any combination thereof” does not restrict its applicability solely to contracts between property owners and other listed parties. For indemnity provisions to be enforceable, they must include a monetary cap on liability.
The indemnity provision in question, located on the reverse side of a delivery receipt, required the lessee to indemnify the lessor for damages due to the lessor’s negligence. Following a scaffolding failure that led to a successful negligence lawsuit against the lessor by an injured worker, the lessor sought indemnity from the lessee. However, the court determined that the indemnity provision was void under section 725.06 because it lacked a monetary limitation on liability. The trial court's ruling was found to be erroneous, leading to the reversal of the final judgment and remand for further proceedings. The court clarified that section 725.06 protects against unlimited indemnity liability in construction-related contracts, requiring either a monetary limit on indemnification or specific consideration for the indemnity to be enforceable.
