Mark A. Schaefer v. Spider Staging Corporation, Defendant-Appellee/cross-Appellant v. Schaefer & Sons Roofing, Inc., Third Party Defendant-Appellant/cross-Appellee. Spider Staging Corporation v. Schaefer & Sons Roofing, Inc.
Docket: 01-1008
Court: Court of Appeals for the Third Circuit; January 6, 2002; Federal Appellate Court
Four consolidated appeals arose from an accident involving roofers Mark Schaefer and Wayne Rothgeb, employees of Schaefer and Sons Roofing, Inc., who were injured due to a scaffolding platform collapse rented from Spider Staging Corporation. The injuries included Rothgeb's fall of twenty-five feet and Schaefer's four-foot fall, where he struck the building. Both employees filed separate negligence suits against Spider Staging in the Eastern District of Missouri, which were overseen by different judges. Spider Staging subsequently filed third-party claims against Schaefer Roofing for indemnity based on their rental agreement.
In Mark Schaefer's trial, the jury attributed seventy-five percent fault to Spider Staging and twenty-five percent to Schaefer, awarding $1,750,000 in damages. However, District Judge E. Richard Webber deemed this amount excessive and ordered a new trial or a remittitur to $200,000, which Schaefer declined, leading to a retrial where he was awarded only $30,000. Schaefer appealed the remittitur order. Additionally, Judge Webber had granted summary judgment on Spider Staging's indemnity claim against Schaefer Roofing before the first trial and later awarded Spider Staging $315,358.62 for costs and attorney's fees.
Wayne Rothgeb settled with Spider Staging prior to trial. District Judge Carol E. Jackson also granted summary judgment on the indemnity claim against Schaefer Roofing, awarding Spider Staging $185,752.34, which included the Rothgeb settlement and attorney's fees, along with prejudgment interest. Schaefer Roofing appealed the indemnity and attorney's fee rulings, while Spider Staging cross-appealed the denial of prejudgment interest. The court affirmed all but the prejudgment interest award in Case No. 01-1617.
Regarding the remittitur, Judge Webber determined the initial jury award was excessive based on Missouri law, considering all trial evidence in accordance with federal standards, allowing the court to grant a new trial despite substantial evidence supporting the initial verdict.
Mark Schaefer contends that the district court improperly reviewed the evidence without favoring the verdict holder, as required by Missouri law. However, he fails to provide direct legal authority to support this claim. The court finds this argument unmeritorious, referencing *Gasperini v. Center for Humanities*, which confirms that while state law substantive standards apply in diversity cases, procedural matters like remittitur fall under federal law. The district court's role is to ensure the jury's verdict aligns with state law and to determine, using federal standards, the appropriateness of a new trial or remittitur.
Judge Webber correctly applied both substantive and procedural standards, affirming the need for a remittitur in favor of Spider Staging. Additionally, the equipment rental agreement included an indemnity clause where Schaefer Roofing indemnified Spider Staging for its own negligence. The court granted summary judgment in favor of Spider Staging on its indemnity claim, concluding that the indemnity provision was enforceable under Missouri law, applicable to Schaefer's claims, and that the agreement was not signed under duress or undue influence. The appellate court rejects Schaefer Roofing's challenges, agreeing with Judge Webber's thorough analysis in his October 7, 1999, Memorandum and Order.
Schaefer Roofing appeals the summary judgment favoring Spider Staging in Wayne Rothgeb's lawsuit, which hinges on an indemnity claim linked to the same equipment rental agreement for two personal injury cases. The courts upheld Judge Webber's ruling in the Mark Schaefer case, affirming Judge Jackson's similar decision. The indemnity provision allowed Spider Staging to recover costs and attorney's fees, resulting in awards of $315,358.62 in the Mark Schaefer case and $185,752.34 in the Rothgeb case. Schaefer Roofing contests both amounts as unreasonable, but the courts found no abuse of discretion; detailed billing records were reviewed, and no substantial challenges were made by Schaefer Roofing.
Regarding prejudgment interest, Missouri law permits it on due amounts from written contracts. Judge Webber awarded it from November 22, 2000, in the Mark Schaefer case, while Judge Jackson awarded it from March 20, 1995, in the Rothgeb case. Spider Staging's argument for earlier prejudgment interest was dismissed, as it failed to demonstrate that costs were incurred or demanded for reimbursement before the later awarded dates. The judges acted within their discretion by limiting prejudgment interest to when Spider Staging first filed for reimbursement, aligning with precedents that emphasize the necessity of liquidity for interest awards.
Schaefer Roofing contends that Judge Jackson incorrectly awarded prejudgment interest on the total judgment amount of $185,752.34 starting from March 20, 1995. Spider Staging asserts that Schaefer Roofing did not preserve this issue by failing to object to the prejudgment interest request in the district court, but the court may still review it for plain error that impacts judicial fairness. Judge Jackson did not address the prejudgment interest. Spider Staging's damages included $130,000 paid to settle Rothgeb's claim and $55,752.34 in costs and attorney's fees incurred after March 20, 1995. The court finds that awarding prejudgment interest was a plain error, exceeding the compensatory purpose of MO. REV. STAT. 408.020. Despite the issue not being properly raised, fairness necessitates an accurately calculated attorney's fees award. Consequently, the judgment in Schaefer's lawsuit is affirmed, while the judgment in Rothgeb's lawsuit is vacated and remanded for reconsideration of the prejudgment interest issue, with all other aspects of the judgment affirmed. Additionally, a settlement agreement on May 16, 2000, between Mark Schaefer, an owner of Schaefer Roofing, and Schaefer Roofing's liability insurer, involved a payment of $370,000. Spider Staging claims this settlement rendered Schaefer Roofing insolvent, potentially constituting a fraudulent transfer to evade liability. The decision does not address this issue, and any disputes over creditor rights to Schaefer Roofing's insurance proceeds should be resolved in separate proceedings.
