Court: Court of Appeals of Oregon; December 13, 1983; Oregon; State Appellate Court
Concel, Inc. and APL Corporation appeal a summary judgment favoring Boise-Cascade regarding Concel’s indemnity claim. The case stems from a personal injury to a Boise employee operating a paper machine owned by Concel at Boise's facility. A 1968 contract required Boise to operate and maintain the machine. After the employee was injured in 1979, Boise paid workers’ compensation benefits and the employee sued Concel for negligence, alleging multiple failures in safety and instruction. Concel then sought indemnity from Boise, but the trial court granted Boise's summary judgment motion, asserting no factual disputes existed and that Boise had no independent duty to Concel regarding workplace safety or liability protection. Concel did not oppose this motion. The court affirmed the summary judgment, concluding that no genuine issue of fact was present regarding Boise's independent duty to Concel. Although Concel argued that Boise had assumed such a duty through their contract, the court found no factual basis to support this claim, thereby not addressing whether ORS 656.018(1) precluded the indemnity action. The ruling referenced relevant case law affirming that indemnity claims can proceed if the third-party plaintiff's liability stems from a breach of an independent duty owed by the employer.
The 1968 contract between Boise and Concel lacks an explicit indemnification clause. A precedent case, Sandwell International Inc. v. American Can Co., established that an engineering firm cannot seek indemnity from an employer without an independent duty of care owed by the employer to the engineering firm, which does not arise merely from service purchases. Boise’s obligation to maintain a safe working environment is directed solely to its employees and is fulfilled through worker’s compensation benefits.
Concel asserts that section 8 of the contract implies an independent duty of care from Boise to protect Concel from liability for employee injuries. The relevant provisions detail Boise's responsibilities for the operation and upkeep of the Paper Machine, ensuring its efficient functioning for Concel. However, even if such a duty is implied, it is also shared with Concel, as Concel directs Boise's operations, negating the possibility of indemnity. Concel's alternative claim that Boise’s status as a bailee creates liability was not raised in the trial court and thus is not considered on appeal.
The court upheld the summary judgment in favor of Boise. Subsequently, a jury found Concel 67% negligent and the plaintiff 33% negligent. According to ORS 656.018(1), an employer satisfying the duty under ORS 656.017(1) is exclusively liable for compensable injuries, which includes barring third-party indemnity claims, unless specified otherwise. Agreements contrary to this provision made after July 19, 1977, are deemed void.
