Opinion
Docket No. 77-4211.
Decided November 28, 1978. Leave to appeal denied, 406 Mich. 915.
Smith, Haughey, Rice Roegge (by Lance R. Mather), for defendant YMCA.
Cholette, Perkins Buchanan (by Edward D. Wells), for defendant Ludington Area School District.
On June 7, 1973, defendant (hereinafter YMCA), and third-party defendant, Ludington Area School District (hereinafter the school district), entered into a contract which provided that the school would have the exclusive use of the YMCA camp from September 24, 1973, to September 28, 1973. On September 23, 1973, plaintiffs, a teacher for the Ludington Area School District and his wife, were at the YMCA camp in anticipation of the school's use of the camp beginning on the following day. During the evening, plaintiff Sharon Gartside was injured when she was thrown from a horse which she was riding at the camp. As a result of these injuries, plaintiffs filed a suit against the YMCA alleging that they negligently encouraged her to ride a very spirited and quick-tempered horse and negligently provided her with defective riding equipment. The YMCA then filed a third-party complaint against the school district for indemnification. The school district made a motion for summary judgment, GCR 1963, 117.2(1), which was granted, and the YMCA appeals.
The standard of review for determining the correctness of a ruling on a motion for summary judgment pursuant to GCR 1963, 117.2(1), is set out in Borman's, Inc v Lake State Development Co, 60 Mich. App. 175, 179-180; 230 N.W.2d 363, 366 (1975):
"A motion based solely on subsection 1, challenges the legal sufficiency of a plaintiff's claim and is to be considered by an examination of the pleadings alone. Todd v Biglow, 51 Mich. App. 346, 349; 214 N.W.2d 733 (1974). [The] job [of] a reviewing court is to accept as true the well-pleaded facts in plaintiff's complaint, * * *, Weckler v Berrein [sic] County Road Commission, 55 Mich. App. 7, 9; 222 N.W.2d 9 (1974), and to determine whether these claims are so `clearly unenforceable as a matter of law that no factual development can possible [sic] justify a right to recovery.' Crowther v Ross Chemical Manufacturing Co, 42 Mich. App. 426, 431; 202 N.W.2d 577 (1972)."
The YMCA's claim for indemnification is based on a provision of its contract with the school district, whereby the school district promised:
"(f) To indemnify YMCA against, and to hold YMCA, its agents and employees harmless from, all claims, demands, costs or damages (including attorneys' fees) because of bodily injury, including death, or property damage to any person or legal entity at any time arising out of or in any way connected with School's use of the Camp and its facilities."
The trial court granted the school district's motion for summary judgment on the basis that the contract provision for indemnification was only intended to apply during the period of the contract: September 24, 1973, to September 28, 1973. While this is one possible interpretation of the contract provision, the indemnity clause is not free from ambiguity on this point. Accepting the well-pleaded facts in the YMCA's complaint as true, its claim that the indemnity provision was intended to apply to an accident which occurred on September 23, 1973, is not so clearly unenforceable as a matter of law that no factual development could possibly sustain it. Accordingly, the trial judge erred in granting the school district's motion for summary judgment on this basis.
The school district also contends that even if the trial judge erred in granting the motion for summary judgment on the basis that the contract provision did not apply to an injury occurring on September 23, 1973, the order of summary judgment should be affirmed because the indemnity provision of the contract did not bind the school district to indemnify the YMCA for damages caused by its sole negligence.
Indemnity contracts, like other contracts, are to be enforced so as to effectuate the intentions of the parties, Title Guaranty Surety Co v Roehm, 215 Mich. 586; 184 N.W. 414 (1921). Contracts to indemnify the indemnitee for damages caused by the indemnitee's sole negligence are not unenforceable or contrary to the public policy of this state, but see, MCL 691.991; MSA 26.1146(1). However, a contract which purportedly indemnifies one against the consequences of his own negligence is subject to strict construction and will not be so construed unless it clearly appears that it was intended to cover the indemnitee's own negligence, Fireman's Fund American Ins Cos v General Electric Co, 74 Mich. App. 318; 253 N.W.2d 748 (1977), Hubbert v Acme Equipment Co, 55 Mich. App. 313; 222 N.W.2d 224 (1974), Klann v Hess Cartage Co, 50 Mich. App. 703; 214 N.W.2d 63 (1973), Geurink v Herlihy Mid-Continent Co, 5 Mich. App. 154; 146 N.W.2d 111 (1966), Meadows v Depco Equipment Co, 4 Mich. App. 370; 144 N.W.2d 844 (1966). Also, indemnity contracts are construed most strictly against the party who drafts them and the indemnitee, Fireman's Fund, supra. Recognizing these strict rules of construction, the YMCA argues that the contract provisions clearly show the parties' intention that the school district was to indemnify the YMCA even for damages caused by its own negligence. Alternatively, the YMCA argues that even if the language used in the written contract provision does not sufficiently show the parties' intention to have the school district indemnify the YMCA for the damages suffered in this case, the contract provision when considered in light of the situation of the parties and the surrounding circumstances, when the facts are properly developed, clearly shows the parties' intention that the school district would indemnify the YMCA in this case.
Although indemnity contracts are strictly construed, they are to be enforced so as to effectuate the intentions of the parties. Accordingly, in ascertaining the intentions of the parties, one must consider not only the language used in the contract but also the situation of the parties and the circumstances surrounding the contract, see, Title Guaranty, supra. As the Supreme Court stated in Vanden Bosch v Consumers Power Co, 394 Mich. 428; 230 N.W.2d 271 (1975),
"Although not `expressly' stated in the agreement, we are persuaded from our reading of that agreement, in light of the surrounding circumstances, that the parties intended that Consumers Power be indemnified against liability for its own negligence of the type precipitating this litigation."
Applying this reasoning to the facts in this case, we conclude that there are some factual developments possible under the allegations in the YMCA's pleadings which may establish its right to indemnification. We recognize that the YMCA may not be able to establish, at trial, that the parties clearly intended to provide for indemnification for the indemnitee's own negligence, see, Fireman's Fund, supra, Hubbert, supra, Klann, supra, see also Geurink, supra. In the cases cited above, the trial judge ruled that the indemnitees had failed to prove that the written contract provisions, when considered in light of the surrounding circumstances, clearly showed the parties' intention to indemnify the indemnitee for his own negligence. However, these rulings on the indemnitor's motion for a directed verdict were made after trial so that the indemnitee was given an opportunity to prove the parties' intention.
In Geurink v Herlihy Mid-Continent Co, 5 Mich. App. 154; 146 N.W.2d 111 (1966), the trial court granted the indemnitor's motion for summary judgment. However, it must be seen that in Geurink, supra, the motion was granted after trial, see White v McLouth Steel Corp, 18 Mich. App. 688; 171 N.W.2d 662 (1969).
In Meadows, supra, this Court affirmed the trial judge's decision to grant the indemnitor's motion for summary judgment but only because the contract provision in that case was barren of any reference to the concept of indemnity for damages caused by the indemnitee's own negligence. In Vannoy v City of Warren, 2 Mich. App. 78; 138 N.W.2d 520 (1965), this Court affirmed the denial of a motion for summary judgment since the written contract terms were equivocal and uncertain as to this point and because the construction of those terms must wait until after the trial court has had an opportunity to consider evidence of the situations of the parties and the circumstances surrounding the contract. This reasoning is also applicable to this case. Although the YMCA may not be able to carry the heavy burden it will bear at trial of persuading the trier of facts that the parties clearly intended that the contract was to cover the YMCA's own acts of negligence, the YMCA's complaint does contain a claim which could be factually developed at trial so as to justify a right of recovery. Accordingly, the order of summary judgment entered under GCR 1963, 117.2(1), is reversed and this case is remanded to the trial court for further proceedings.
Reversed and remanded for further proceedings not inconsistent with this opinion. Costs to defendant-third-party plaintiffs.