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HARMON v. ROBBERSON STEEL COMPANY

January 7, 1958

D.A. HARMON AND AMERICAN MOTORISTS INSURANCE COMPANY, PLAINTIFFS,
v.
ROBBERSON STEEL COMPANY, A DELAWARE CORPORATION, DEFENDANT.



The opinion of the court was delivered by: John E. Miller, District Judge.

The plaintiff, D.A. Harmon, filed his complaint on March 16, 1957, in the Circuit Court of Washington County, Arkansas, in which he alleged:

That prior to June 2, 1954, he, as general contractor, was engaged in the construction of a field house for the University of Arkansas at Fayetteville, Arkansas; that on said date he and the defendant, Robberson Steel Company, entered into two written agreements, one being a "Subdealer's Purchase Order" and the other a "Sub-Contract Agreement". The "Subdealer's Purchase Order" provided, inter alia, that the defendant was to fabricate and furnish certain materials for the construction of the said field house. The "Sub-Contract Agreement" provided, inter alia, that the defendant would "furnish and pay for all labor and perform in a good and workmanlike manner all work necessary to complete the unloading and erecting of all structural steel required in connection with the construction of the field house for the University of Arkansas".

Subsequent to June 2, 1954, the defendant entered into a "Sub-Contract Agreement" with Jesse L. Bailey, d/b/a Bailey Steel Construction Company, for the unloading and erecting of the structural steel.

On November 15, 1954, while the agreements between the plaintiff Harmon and the defendant were in full force and effect, and during the erection of the structural steel for the field house, that portion of the structural steel then in place collapsed, fatally injuring one man and causing serious personal injury to four other men, all being employees of Bailey Steel Construction Company.

That in addition to the death of one of the employees and the personal injuries to the four others, the collapse of the structural steel caused damage to plaintiff in the total sum of $8,527.66.

Subsequent to the death of the one employee and the injuries to the other four employees of Bailey Steel Construction Company, separate suits were filed in the Circuit Court of Washington County against plaintiff, D.A. Harmon, the defendant, Robberson Steel Company, and the architects, to recover damages for the death and injury of the employees. The plaintiff Harmon made demand upon defendant that it defend the said suits, and hold the said D.A. Harmon harmless from any loss, cost or expense in connection with said suits but the defendant refused to do so.

On August 8, 1956, the five damage suits then pending in the Circuit Court of Washington County, Arkansas, were compromised and settled. That as a contribution to the settlement, the plaintiff Harmon paid the sum of $50,000; that said settlement was entered into upon a specific written agreement between plaintiff Harmon and the defendant that the amount of the settlement was fair and reasonable, that neither Harmon nor Robberson Steel Company admitted any liability by entering into said agreement, and "that the said settlement was without prejudice to any claims that D.A. Harmon might have against Robberson Steel Company by reason of the sub-contract agreement". That in addition to the contribution of $50,000 on the part of the plaintiff to the settlement of said personal injury suits, the said plaintiff incurred expenses in excess of $10,000 in connection with the defense of said personal injury suits.

The complaint in paragraph 10 enumerates the items of damages, totaling $8,527.66, which the plaintiff claims were caused by the collapse of the structural steel.

The plaintiff further alleged that by the terms of the "Sub-Contract Agreement" he is entitled to recover from the defendant a total sum of $68,527.66, being comprised of the sum of $8,527.66, $50,000 contribution to settlement of personal injury cases, and $10,000 cost of defending the personal injury cases.

In paragraph 13 of the complaint the plaintiff alleged in the alternative that the collapse of the structural steel and the resulting cost, loss, expense, and damage to the plaintiff was occasioned by the act or neglect, and the negligence of Bailey Steel Construction Company, its agents, servants or employees, and that for the purpose of the performance of the work Bailey Steel Construction Company was an agent of the defendant and was negligent and careless in adopting the method used for the erection of the structural steel, in failing to provide adequate shoring or bracing for the steel, and in attempting to force one of the members into position in such a manner as to create a vibration throughout the entire structure, when they knew, or ought to have known in the exercise of ordinary care that a collapse of the structure might result; that the negligence of Bailey Steel Construction Company, its agents, servants or employees, was a proximate cause of the collapse of the structural steel, and that plaintiff is entitled to recover from the defendant under the terms of the "Sub-Contract Agreement" the said sum of $68,527.66.

In paragraph 14 of the complaint the plaintiff further alleged in the alternative that the collapse of the structural steel was caused by negligence on the part of the defendant, its agents, servants and employees in that they negligently and carelessly failed to fabricate the steel in accordance with the plans and specifications, and failed to supervise the method of erection being used by Bailey Steel Construction Company, and in failing to require Bailey Steel Construction Company to provide adequate and sufficient shoring and bracing of the steel in place; that the said negligence of the defendant was a proximate cause of the collapse of the structural steel, and that plaintiff is entitled to recover the said sum of $68,527.66.

In due time the cause was removed to this Court, and on May 16, 1957, the defendant filed its answer and counterclaim.

In the answer the defendant admitted that plaintiff had contributed $50,000 to the settlement of the claims and suits for personal injuries referred to in the complaint, but alleged that it had no knowledge or information as to the expenses incurred by the plaintiff in connection with the defense of the personal injury suits in the Circuit Court of Washington County, Arkansas.

Admitted the correctness of the amount of damages claimed by plaintiff in the sum of $8,527.66, but denied that it was liable to plaintiff for such damages.

Denied that the loss, damage and expense allegedly suffered by plaintiff resulted from the performance of the work covered by the "Sub-Contract Agreement", and "states that such loss, damage and expense was proximately caused by the negligence of plaintiff". Denied that the alleged negligence of Bailey Steel Construction Company was "the proximate cause of the collapse of the structural steel" and alleged that the proximate cause of such collapse was the negligence of plaintiff.

The defendant denied that it was guilty of negligence in any particular as alleged by plaintiff, "and denies that the alleged negligence of this defendant was the proximate cause of the collapse of the structural steel referred to therein. Defendant states that the proximate cause of such collapse was the negligence of plaintiff in the particulars hereinafter set forth".

The defendant further alleged:

    "Plaintiff is not the real party in interest as to
  the $50,000 allowed in its complaint which has been
  expended in settlement of personal injury

  and death cases, which settlements were actually made
  by plaintiff's insurance carrier, the American
  Motorists Insurance Company, which company is a
  necessary party to this action."

The defendant further alleged that the collapse of the structural steel was proximately caused, or, in the alternative was contributed to by the negligence of the plaintiff in the following particulars:

    "1. As prime-contractor, it was the duty of D.A.
  Harmon to co-ordinate and supervise the work of
  sub-contractors; and to furnish to sub-contractors,
  in proper sequence, the work site, in suitable and
  proper condition for performance of the work of
  sub-contractors.
    "2. As part of preparation of the work site by
  plaintiff for erection of steel rigid frames by
  Bailey Steel Construction Company, the plaintiff was
  required to construct concrete foundations for
  support of the base of each frame; and failed to
  properly prepare and construct the concrete
  foundations in the following particulars:
    "a. The plaintiff failed to permit the concrete to
  set for a sufficient length of time to properly cure
  and attain a proper degree of hardness before turning
  over the same to Bailey Steel Construction Company
  for erection of the rigid frames.
    "b. The plaintiff set steel anchor bolts in the
  foundations improperly; and, especially in the
  foundation supporting the northwest column of the
  building, the anchor bolts were set too deeply in the
  concrete, so that the ends of the bolts extending
  above the concrete were too short to anchor down the
  rigid frames. Plaintiff, thereupon, negligently and
  carelessly extended the anchor bolts by welding
  extensions thereon.
    "c. Plaintiff was further negligent in that the
  welding between the anchor bolts and extensions
  thereon was improperly performed, with only the
  outside circumference of metal between the original
  bolts and the extensions connected by a weld, so that
  only a thin shell of metal held the extension onto
  the anchor bolt.
    "d. Plaintiff knew, or by the exercise of ordinary
  care should have known, that the anchor bolts were
  intended to withstand great stresses and strain,
  especially during the erection phase of the steel
  framework of the building, and that the anchor bolts
  as extended, were inadequate to serve the purpose for
  which they were designed.
    "e. The plaintiff failed to advise or warn this
  defendant, or the Bailey Steel Construction Company
  of the unsafe and inadequate anchor bolts (that) had
  been installed in the concrete foundations, well
  knowing that the Bailey Steel Construction Company
  would rely upon safe and adequate anchor bolts having
  been installed, and perform its steel erection
  procedure accordingly."

That by reason of the negligence of plaintiff which proximately caused or contributed to the collapse of the structural steel, "plaintiff is precluded from recovering in this cause under the indemnity agreement referred to in paragraph 11 of plaintiff's complaint and under the allegations of negligence, as alleged in paragraphs 13 and 14 of plaintiff's complaint".

By counterclaim the defendant alleged that by reason of the negligence of plaintiff the defendant sustained damages in the total sum of $52,445.17 as the cost of repairing damaged steel, replacing it in position, and paying expenses necessarily incurred as a result of the collapse of the said steel.

That the Liberty Mutual Insurance Company, liability insurer for the defendant, paid the sum of $50,000 as a contribution toward the settlement of the death case and the personal injury cases in the Circuit Court of Washington County, Arkansas, "which this defendant is entitled to recover, for and on behalf of the Liberty Mutual Insurance Company."

The defendant prayed that it recover from the plaintiff the said sum of $52,445.17, and the additional sum of $50,000 expended by the Liberty Mutual Insurance Company, insurance carrier of the defendant.

On June 4, 1957, the plaintiff Harmon filed his reply to the counterclaim in which he admitted that the defendant had incurred expense and suffered damages as a result of the collapse of the structural steel, but that he is "without knowledge or information sufficient to form a belief as to the truth of the allegations concerning the extent of such expense and damage and therefore denies that the defendant suffered expense and damage in the amount alleged in the counterclaim".

The plaintiff admitted that the Liberty Mutual Insurance Company paid the sum of $50,000 as a contribution toward settlement of the damage suits in the Circuit Court of Washington County, but denied that the defendant or Liberty Mutual Insurance Company was entitled to recover such sum from the plaintiff.

The plaintiff further alleged in his reply that by the terms of an agreement entered into between him and the defendant on August 9, 1956, that "Robberson Steel Company specifically waives and releases any claim against D.A. Harmon based upon the contribution by Robberson Steel Company to the settlement with the plaintiffs in the said lawsuits".

On July 11, 1957, plaintiff filed his motion for summary judgment, to which defendant filed its response on July 26, 1957, and on August 2, 1957, the Court denied plaintiff's motion for summary judgment, and set the case for a pretrial conference on August 13, 1957. At the pretrial conference the defendant dismissed and struck from its counterclaim sub-paragraph 2 of paragraph 2, and also sub-paragraph 2 of the prayer of the counterclaim; or, in other words, the claim for the recovery of the $50,000 contributed by the Liberty Mutual Insurance Company, insurance carrier of defendant, to the settlement of the damage suits in the Circuit Court of Washington County, Arkansas, was withdrawn.

On August 26, 1957, the plaintiff, D.A. Harmon, filed his motion for permission to amend his complaint and to make American Motorists Insurance Company a party plaintiff in the action, which motion was granted on the same date, and in the amendment it was alleged that the said American Motorists Insurance Company, as liability insurance carrier for plaintiff, paid $50,000 in the settlement of the damage suits in the Washington County Circuit Court and incurred expense in the defense of said suits in the sum of $10,000.

It was further alleged in the amendment:

    "All of said sums paid by American Motorists
  Insurance Company were paid on behalf of D.A. Harmon
  and because of an independent contractual
  relationship between D.A. Harmon and American
  Motorists Insurance Company. Because of the nature of
  the contractual arrangement between D.A. Harmon and
  American Motorists Insurance Company and the basis
  upon which premiums were paid by D.A. Harmon to
  American Motorists Insurance Company, although the
  actual payments in a total sum in excess of Sixty
  Thousand Dollars ($60,000.00) were made by American
  Motorists Insurance Company, the burden of such
  payments was borne, at least in part, by D.A.
  Harmon."

The prayer of the amendment was that the plaintiffs, Harmon and American Motorists Insurance Company, recover from defendant the total sum of $68,527.66.

The defendant did not file any answer to the amendment to the complaint.

At the beginning of the trial the defendant reduced his counterclaim for $52,445.17 to $47,273.50.

The case was tried to the Court without the intervention of a jury on November 25, 26, and 27, 1957. At the conclusion of the trial the case was submitted and taken under advisement, and the attorneys for the parties were granted time in which to prepare, serve and file briefs in support of their respective contentions. The briefs have been received and considered along with the record and all the testimony adduced at the ...


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