Mohammed Al–Kasas v. Yale New Haven Hospital (2011)

MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT (# 134)

FACTS

The plaintiff, Mohamed Al–Kasas, brought this negligence action against the defendant, Yale New Haven Hospital, for injuries the plaintiff allegedly sustained while working for Pro Park, Inc. (Pro Park).   On October 15, 2010, the plaintiff filed a substituted complaint ¹ against the defendant in which he alleges the following.   The defendant “owned, operated, maintained and controlled” a portion of a parking lot located in New Haven (Lot One).   The plaintiff was a parking lot attendant and employee of Pro Park, a company that managed several parking lots for the defendant, including Lot One. On February 23, 2007, while working for Pro Park, the plaintiff slipped and fell on ice and snow that had accumulated on the surface of Lot One. The plaintiff alleges that the defendant was negligent in that it failed to remove the ice and snow or otherwise use preventative measures to render the area less dangerous.

On July 22, 2009, Pro Park filed a motion to intervene and intervening complaint.   The motion to intervene was granted on August 17, 2009.   On October 21, 2010, Pro Park filed a revised intervening complaint to recover workers' compensation benefits paid to the plaintiff.   In the revised intervening complaint, Pro Park alleged that the plaintiff was acting within the scope of the Workers' Compensation Act and his injuries arose within the course of his employment with Pro Park. On February 18, 2011, the defendant filed a counterclaim against Pro Park for indemnification for the amount of any potential settlement or judgment paid to the plaintiff, plus all fees and costs incurred in defense of this matter.   In its counterclaim, the defendant alleges that on July 1, 2001, Pro Park and the defendant entered into a contract under which Pro Park was to provide parking management services for several parking facilities, including Lot One (parking management agreement).²  The defendant further alleges that, pursuant to paragraph nine of the parking management agreement, Pro Park is required to indemnify, defend and hold harmless the defendant from “any and all claims and losses” resulting in connection with the performance of the contract.³

On August 9, 2011, the defendant filed a motion for summary judgment on its counterclaim against Pro Park and a memorandum in support.   The defendant argues that it is entitled to summary judgment because the indemnification provision contained in the parking management agreement requires Pro Park to indemnify, defend and hold harmless the defendant.   On August 24, 2011, Pro Park filed an objection to the motion for summary judgment and a memorandum in opposition.   Pro Park objects on the grounds that:  (1) the language in the indemnification provision does not explicitly relieve the defendant of liability from its own negligence;  and (2) the indemnification provision is contrary to public policy.   This matter was heard at short calendar on September 12, 2011.

LEGAL STANDARD OF REVIEW

“Practice Book § 17–49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.”  (Internal quotation marks omitted.)  Brooks v. Sweeney, 299 Conn. 196, 210, 9 A.3d 347 (2010).  “In ruling on a motion for summary judgment, the court's function is not to decide issues of material fact, but rather to determine whether any such issues exist.”  (Internal quotation marks omitted.)  Maltas v. Maltas, 298 Conn. 354, 365, 2 A.3d 902 (2010).

“In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact.   The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law.   The courts hold the movant to a strict standard.   To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact ․ As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent.”  Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 10–11, 938 A.2d 576 (2008).

ANALYSIS

I.

In the present case, the defendant moves for summary judgment on the ground that the indemnification provision contained in the parking management agreement requires Pro Park to indemnify, defend and hold harmless the defendant.   Specifically, the defendant asserts that since the indemnification provision applies to “any and all claims and losses,” the defendant has a right to contractual indemnification.   Implicit in the defendant's argument is that it is not necessary for the indemnification provision to contain the term “negligence” because the phrase “any and all claims or losses” includes negligence claims.

Pro Park objects to the defendant's motion for summary judgment on two grounds.   Pro Park's first argument is that the indemnification provision is inapplicable because it does not specifically relieve the defendant from liability arising from its own negligence.   Pro Park's second argument is that the indemnification provision is contrary to public policy.   This memorandum will address the arguments in order.

Connecticut courts have recognized the enforceability of exculpatory provisions releasing a defendant from liability for its own negligence where the parties to the agreement containing the provision are both commercial entities.  Dow–Westbrook, Inc. v. Candlewood Equine Practice, LLC, 119 Conn.App. 703, 711–18, 989 A.2d 1075 (2010);  B & D Associates, Inc. v. Russell, 73 Conn.App. 66, 72–73, 807 A.2d 1001 (2002);  Burkle v. Car & Truck Leasing Co., 1 Conn.App. 54, 57–58, 467 A.2d 1255 (1983).  “In modern commerce, indemnity clauses are no longer so unusual as to require such specific mention of the indemnitee's conduct as being within the scope of the indemnifying obligation ․ Indemnity clauses in contracts entered into by businesses ․ should be viewed realistically as methods of allocating the cost of the risk of accidents apt to arise from the performance of the contract.”   (Internal quotation marks omitted.)  Dow–Westbrook, Inc. v. Candlewood Equine Practice, LLC, supra, 119 Conn.App. 712.

In B & D Associates, Inc. v. Russell, supra, 73 Conn.App. 73, the Appellate Court held that less precise language is required when one party among “sophisticated business entities” seeks to shield itself from liability arising from its negligent acts.   In that case, the plaintiff, a commercial tenant, brought an action in negligence against the defendant landlord for losses resulting from a fire.  Id., 68.   The lease executed by the parties provided that “there shall be no liability on the part of the LANDLORD to said TENANT ․ for any damage or loss to any of the foregoing from any cause or for any reason whatsoever.”  Id., 69.   Notwithstanding the omission of the defendant's negligence from the exculpatory clause, the Appellate Court held that the lease clearly relieved the defendant from liability for negligently causing the types of losses articulated in the agreement.  Id., 73.   Similarly, in Burkle v. Car & Truck Leasing Co., supra, 1 Conn.App. 56–57, the court held that the language “lessee agrees to indemnify and hold [l]essor harmless from any and all liability” was sufficiently explicit to release the lessor from liability from its own negligence.

Nevertheless, Pro Park's first argument in objection to the motion for summary judgment is that the indemnification provision is inapplicable because it does not explicitly relieve the defendant from liability arising from its own negligence.   Pro Park argues that two recent decisions by our Supreme Court signal a significant shift in how these types of indemnification agreements should be construed.   Specifically, Pro Park cites to Hyson v. White Water Mountain Resorts of Connecticut, Inc., 265 Conn. 636, 829 A.2d 827 (2003) and Hanks v. Powder Ridge Restaurant Corp., 276 Conn. 314, 885 A.2d 734 (2005).   The clear message from Hyson and Hanks, Pro Park asserts, is that the language contained in an exculpatory clause must announce the disfavored provision clearly and unequivocally so that the terms of the contract are unmistakable.   Thus, Pro Park argues, the reference to “any and all claims and losses” in the instant exculpatory agreement is not sufficiently clear in its effect that Pro Park is agreeing to pay for damages for the defendant's own negligence.

In Hyson, our Supreme Court held that, in the consumer recreational context of snowtubing, any release from tort liability must expressly refer to negligence to be valid.  Hyson v. White Water Mountain Resorts of Connecticut, supra, 265 Conn. 643.   Subsequently, in a case with very similar facts, the court held that even releases from liability in consumer contracts that explicitly refer to negligence are void as against public policy.   Hanks v. Powder Ridge Restaurant Corp., supra, 276 Conn. 335–36.   Both of those cases, however, involve a plaintiff who was forced to sign a contract of adhesion before engaging in a public recreational activity and are distinguishable from B & D Associates, Inc.⁴ Hyson v. White Water Mountain Resorts of Connecticut, supra, 265 Conn. 637–39;  Hanks v. Powder Ridge Restaurant Corp., supra, 276 Conn. 316–17.

Accordingly, Pro Park's assertion that Hyson and its later progeny signal a significant shift away from B & D Associates, Inc. is not accurate.   Rather, as our Appellate Court explained, “[b]oth cases offer examples of the validity or invalidity of exculpatory agreements.  In B & D Associates, Inc., this court stated that less precise language is required when one contracting party among sophisticated business entities seeks to relieve itself of its own negligence ․ implicitly concluding that such an exculpatory clause could be valid.   In Hyson and its later progeny ․ our Supreme Court concluded that, in a recreational setting in which there is a distinct inequity in bargaining power between the parties, imprecise hold harmless language is fatal to the legal merit of the agreement, despite the parties' intent.”  Roman v. Bristol, 101 Conn.App. 491, 499, 922 A.2d 310 (2007).

In the present case, there is no dispute that the indemnification provision contained in the parking management agreement does not make explicit reference to a waiver of claims based on the defendant's own negligence.   Thus, the issue becomes whether the evidence, when viewed in a light most favorable to the nonmoving party, indicates that the exculpatory provision was included in an agreement negotiated between two commercial entities of similar bargaining power.   The resolution of this issue is necessary to determine whether to apply B & D Associates, Inc. or Hyson to the present case.   See Roman v. Bristol, supra, 101 Conn.App. 500–01.

Phoenix Ins. Co. v. Vernon, Superior Court, judicial district of Hartford, Docket No. CV 04 4025148 (January 5, 2007, Berger, J.) [42 Conn. L. Rptr. 564] is instructive here.   In Phoenix Ins. Co., the plaintiff tenant filed suit against the lessor of a commercial building after water pipes burst and allegedly damaged the plaintiff's property.  Id. The defendant argued that the lease agreement absolved it from any liability alleged by the plaintiff.   Id. The relevant portion of the lease provided that the “[plaintiff] agrees to ․ hold harmless the [defendant] against any and all claims, demands, suits, or loss.”  Id. The court granted summary judgment for the defendant based, in part, on the analysis contained in B & D Associates, Inc. Id. First, the court found that the parties had relatively equal bargaining status at the time they executed the lease.  Id. Specifically, the court reasoned that the lease agreement, which provided that the property would be leased at a rate of no more than two dollars per square foot, was evidence of the parties' similar bargaining status.  Id. Second, the court found that a provision contained in the subject lease that required the plaintiff to carry insurance was evidence that the parties intended the plaintiff to carry the risk of loss.  Id. Finally, the court distinguished Hyson and Hanks because those cases involve public recreational activities in which the plaintiff was forced to sign a contract of adhesion.  Id. Accordingly, the court found that the exculpatory provision in the lease was sufficiently clear and unambiguous to release the defendant from liability under the standard articulated in B & D Associates, Inc. Id.

Similarly, in the present case, the evidence submitted by the defendant along with its memorandum in support indicates that the indemnification provision contained in the parking management agreement is a commercial risk device, rather than a contract of adhesion.   For instance, paragraph two of the parking management agreement indicates that Pro Park was responsible for managing multiple parking lots for the defendant for a monthly rate in excess of fifty thousand dollars.   Also included with the memorandum in support are the first and second amendments to the parking management agreement.   Pro Park's acceptance and subsequent renewal of the terms of the agreement demonstrate that the company understood the exculpatory clause at the time the parties executed the contract.   Finally, paragraph seven of the parking management agreement, which requires Pro Park to carry insurance, further demonstrates an intent by the parties that Pro Park shield the defendant from liability.

In contrast, in Molnar v. Norcross, Superior Court, judicial district of New Britain, Docket No. CV 10 6003123 (December 20, 2010, Swienton, J.) [51 Conn. L. Rptr. 209], the court denied the defendants' motion for summary judgment because insufficient evidence was submitted by the defendants to show the absence of a genuine issue of material fact as to the plaintiff's bargaining power with respect to the contract.   In Molnar, the plaintiff was an individual who was injured while attending an automobile auction.  Id. The defendant moved for summary judgment, in part, on the ground that the plaintiff signed a release from liability prior to attending the auction.  Id. The court held that there was insufficient evidence to determine whether the plaintiff had the power to negotiate the terms of the application or whether the plaintiff could have negotiated for protection against negligence.  Id. Accordingly, the defendants' motion for summary judgment was denied.  Id.

The present case is distinguishable from Molnar because the issue in that case was whether less specific release language is sufficient to be enforced against individuals, rather than commercial entities.  Id. Further, the defendants in Molnar were moving for summary judgment on the plaintiff's personal injury claim.  Id. In the present case, the defendant is not seeking a judgment of the plaintiff's personal injury claim;  rather, it is asking the court to determine which commercial entity should bear any potential economic loss as a result of that claim.   Thus, the underlying facts in Molnar that created the inference that there may have been a large disparity in bargaining power between the parties are not present here.

Based upon the above case law and the lack of any evidence indicating that Pro Park was in a weaker bargaining position with respect to the parking management agreement, the language in the exculpatory clause should be construed according to the rule articulated in B & D Associates, Inc. Accordingly, the language contained in the provision referring to “any and all claims and losses” is sufficiently explicit and unequivocal to include liability arising from the alleged negligent acts of the defendant.

II.

Pro Park's second argument is that, even if the court determines that the indemnification provision is sufficiently clear to contemplate the defendant's negligence, such an interpretation would violate public policy.   Specifically, Pro Park asserts that:  (1) a provision which obligates a third party to pay for the consequences of another's negligence is inconsistent with sound public policy;  (2) the indemnification provision is at odds with established Connecticut law concerning a land owner's nondelegable duty to maintain the safety of the premises;  and (3) General Statutes § 52–572k, which invalidates indemnification agreements in construction contracts, is an example of Connecticut's public policy of disfavoring contracts that immunize negligent parties.

First, Pro Park asserts that a provision which obligates a third party to pay for the consequences of another's negligence is inconsistent with the fundamental principles of the Connecticut tort system.   Among the many responses to this position are the numerous situations where indemnification provisions that relieve one party from its own negligence have been upheld.   See e.g. Air Brake Systems, Inc. v. Tuv Rheinland of North America, Inc., 699 F.Sup.2d 462, 477–79 (D.Conn.2010) (motor vehicle brake testing contract);  Dow–Westbrook, Inc. v. Candlewood Equine Practice, LLC, supra, 119 Conn.App. 711–18 (horse breeding agreement);  B & D Associates v. Russell, supra, 73 Conn.App. 72–73 (commercial lease);  Burkle v. Car & Truck Leasing Co., supra, 1 Conn.App. 57–58 (motor vehicle lease).

Our Supreme Court in Hanks v. Powder Ridge Restaurant Corp., supra, 276 Conn. 328, recently adopted a variety of factors to determine whether a contract violates public policy.⁵  As mentioned above, the plaintiff in Hanks filed a negligence action for injuries he sustained while snowtubing at the defendants' facility.  Id., 316–17.   A key factor in the court's determination that the agreement was unenforceable was that it was a “standardized adhesion contract offered to the plaintiff on a take it or leave it basis.”  Id., 333.   The court reasoned that the plaintiff was unable to negotiate the terms of the agreement and did not have the option of obtaining protection against negligence at an additional reasonable cost.  Id. The court also found that the plaintiff lacked the knowledge, experience and authority to discern whether the defendants' snowtubing trails were in a reasonably safe condition.  Id., 331.   Moreover, the court concluded that the defendants had superior bargaining authority.   Id., 332 n.9.

In the present case, the indemnification provision does not violate public policy as discussed in Hanks.   First, Pro Park agreed to provide a specialized service for a considerable amount of money, which suggests that it was not in a weaker bargaining position.   Second, Pro Park agreed to procure insurance, which further evidences its intent and understanding of the indemnification provision and its willingness to shield the defendant from liability.   Finally, Pro Park and the defendant renegotiated the parking management agreement at least two times, as demonstrated by the first and second amendments to the agreement.   In sum, there is no evidence to suggest that the parking management agreement was “not subject to the normal bargaining process of ordinary contracts.”  (Internal quotation marks omitted.)  Hanks v. Powder Ridge Restaurant Corp., supra, 276 Conn. 333.

Second, Pro Park asserts that the indemnification provision is at odds with a land owner's nondelegable duty to maintain the premises in a reasonably safe condition.   The thrust of Pro Park's argument seems to be that since the defendant is the owner of the premises where the alleged injury occurred and is the entity responsible for snow removal, it should not be able to seek contractual indemnification pursuant to the parking management agreement.   Research reveals no cases that directly address this issue.   Nevertheless, the cases relied upon by Pro Park do not stand for the proposition that the defendant cannot recover for indemnity because of its nondelegable duty.

Our Supreme Court has held that “the nondelegable duty doctrine means that a party may contract out the performance of a nondelegable duty, but may not contract out his ultimate legal responsibility ․ [I]t is not a necessary implication of the nondelegable duty doctrine that the contractor to whom the performance of the duty has been assigned may not, under appropriate circumstances, also owe the same duty to a party injured by its breach ․ Instead, we view the nondelegable duty doctrine as involving a form of vicarious liability, pursuant to which the party with the duty may be vicariously liable for the conduct of its independent contractor.   That vicarious liability, however, does not necessarily preclude liability on the part of the independent contractor.”  (Citations omitted.)  Gazo v. Stamford, 255 Conn. 245, 255–56, 765 A.2d 505 (2001).   Moreover, “[i]t is widely recognized that, when one party is vicariously liable for another party's conduct, the appropriate remedy for an innocent party who has been held vicariously liable is a claim for indemnity rather than apportionment.”   Smith v. Greenwich, 278 Conn. 428, 462, 899 A.2d 563 (2006).

In the present case, the defendant is not attempting to apportion liability from itself onto Pro Park on the basis that Pro Park was negligent.   Rather, the defendant seeks indemnification pursuant to a contractual agreement executed by Pro Park and the defendant.  “The right to indemnity is clear when the obligation springs from a separate contractual relation, such as an employer-tenant's express agreement to hold the third-party landlord harmless, or a bailee's obligation to indemnify a bailor, or a contractor's obligation to perform his work with due care ․” (Internal quotation marks omitted.)   Ferryman v. Groton, 212 Conn. 138, 145, 561 A.2d 432 (1989).   Accordingly, the nondelegable duty doctrine does not render the indemnification provision ineffective.

Finally, Pro Park asserts that § 52–572k is an example of Connecticut's public policy of disfavoring contracts that immunize negligent parties.⁶  This argument was explicitly rejected by our Appellate Court.  “Rather than buttressing the argument of voidness on public policy grounds, the effect of this statute is just the opposite.   The legislature, in specifically outlawing hold harmless agreements in the construction industry, showed an intention that such a practice not be deemed against public policy in other situations, for had the legislature intended to outlaw all such provisions as against public policy, it could have said so.”  Burkle v. Car & Truck Leasing Co., supra, 1 Conn.App. 58.   Accordingly, the indemnification provision does not violate public policy.

CONCLUSION

For the foregoing reasons, defendant's motion for summary judgment is granted.

Wilson, J.

FOOTNOTES

FN1. The original complaint named Yale University as the defendant.   The parties agree, however, that Yale New Haven Hospital is the proper defendant in this matter.   On October 5, 2010, the plaintiff filed a motion to substitute party, which was granted by the Superior Court, Wilson, J..  FN1. The original complaint named Yale University as the defendant.   The parties agree, however, that Yale New Haven Hospital is the proper defendant in this matter.   On October 5, 2010, the plaintiff filed a motion to substitute party, which was granted by the Superior Court, Wilson, J.

FN2. Pursuant to its terms, the parking management agreement was valid for a period of five years, ending on July 30, 2006.   Pursuant to a second amendment to the parking management agreement, the contract was extended for an additional five years.   Thus, the parking management agreement, as amended, was in effect at the time of the alleged incident..  FN2. Pursuant to its terms, the parking management agreement was valid for a period of five years, ending on July 30, 2006.   Pursuant to a second amendment to the parking management agreement, the contract was extended for an additional five years.   Thus, the parking management agreement, as amended, was in effect at the time of the alleged incident.

FN3. Paragraph nine of the parking management agreement provides:  “INDEMNIFICATION:  VENDOR agrees to indemnify, defend and save harmless Hospital, its officers, agents and employees from any and all claims and losses occurring or resulting to any person, firm or corporation furnishing or supplying services, materials or labor in connection with the performance of this CONTRACT and from any and all claims and losses occurring or resulting to any person, firm or corporation who may be injured or damaged by VENDOR in the performance of this CONTRACT and against any liability including costs and expenses for violation of property rights, copyrights or right to privacy.”.  FN3. Paragraph nine of the parking management agreement provides:  “INDEMNIFICATION:  VENDOR agrees to indemnify, defend and save harmless Hospital, its officers, agents and employees from any and all claims and losses occurring or resulting to any person, firm or corporation furnishing or supplying services, materials or labor in connection with the performance of this CONTRACT and from any and all claims and losses occurring or resulting to any person, firm or corporation who may be injured or damaged by VENDOR in the performance of this CONTRACT and against any liability including costs and expenses for violation of property rights, copyrights or right to privacy.”

FN4. The court in Hyson distinguished B & D Associates because in that case “the plaintiff was a business entity and the defendant was a business person at the time the lease was executed, and ․ there is no evidence that the defendant had significantly more bargaining power than the plaintiff.   Additionally, the evidence establishes that the plaintiff, not the defendant, paid to insure itself from losses caused by fire, further evidencing the parties' intent to relieve the defendant from liability.”  (Internal quotation marks omitted.)  Hyson v. White Water Mountain Resorts of Connecticut, supra, 265 Conn. 642 n.6..  FN4. The court in Hyson distinguished B & D Associates because in that case “the plaintiff was a business entity and the defendant was a business person at the time the lease was executed, and ․ there is no evidence that the defendant had significantly more bargaining power than the plaintiff.   Additionally, the evidence establishes that the plaintiff, not the defendant, paid to insure itself from losses caused by fire, further evidencing the parties' intent to relieve the defendant from liability.”  (Internal quotation marks omitted.)  Hyson v. White Water Mountain Resorts of Connecticut, supra, 265 Conn. 642 n.6.

FN5. Specifically, the court adopted a six-factor test that was articulated by the Supreme Court of California in Tunkl v. Regents of the University of Calfornia, 60 Cal.2d 92, 98–101, 383 P.2d 441, 32 Cal.Rptr. 33 (1963)..  FN5. Specifically, the court adopted a six-factor test that was articulated by the Supreme Court of California in Tunkl v. Regents of the University of Calfornia, 60 Cal.2d 92, 98–101, 383 P.2d 441, 32 Cal.Rptr. 33 (1963).

FN6. General Statutes § 52–572k provides:“(a) Any covenant, promise, agreement or understanding entered into in connection with or collateral to a contract or agreement relative to the construction, alteration, repair or maintenance of any building, structure or appurtenances thereto including moving, demolition and excavating connected therewith, that purports to indemnify or hold harmless the promisee against liability for damage arising out of bodily injury to persons or damage to property caused by or resulting from the negligence of such promisee, such promisee's agents or employees, is against public policy and void, provided this section shall not affect the validity of any insurance contract, workers' compensation agreement or other agreement issued by a licensed insurer.(b) The provisions of this section shall apply to covenants, promises, agreements or understandings entered into on or after the thirtieth day next succeeding October 1, 1977.”.  FN6. General Statutes § 52–572k provides:“(a) Any covenant, promise, agreement or understanding entered into in connection with or collateral to a contract or agreement relative to the construction, alteration, repair or maintenance of any building, structure or appurtenances thereto including moving, demolition and excavating connected therewith, that purports to indemnify or hold harmless the promisee against liability for damage arising out of bodily injury to persons or damage to property caused by or resulting from the negligence of such promisee, such promisee's agents or employees, is against public policy and void, provided this section shall not affect the validity of any insurance contract, workers' compensation agreement or other agreement issued by a licensed insurer.(b) The provisions of this section shall apply to covenants, promises, agreements or understandings entered into on or after the thirtieth day next succeeding October 1, 1977.”

Wilson, Robin L., J.