THE ESTATE OF LUIS CARLOS TAVARES VS. LUCAS CONSTRUCTION GROUP, INC. VS. LIONEL LUCAS (L-2713-11, MIDDLESEX COUNTY AND STATEWIDE) ( 2018 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-5272-15T4
THE ESTATE OF LUIS CARLOS TAVARES
and PAULA PIRES, his wife, serving
as Administratrix Ad Prosequendum
of the ESTATE OF LUIS CARLOS TAVARES,
Plaintiff,
v.
LUCAS CONSTRUCTION GROUP, INC.,
FREDERIC R. HARRIS, INC., DMJM +
HARRIS, INC., DMJM HARRIS/AECOM,
and AECOM,
Defendants-Respondents,
and
COUNTY OF MIDDLESEX,
Defendant-Appellant,
and
v.
LIONEL LUCAS, ANTONIO LUCAS,
CONSOLIDATED RAIL CORPORATION,
TOWNSHIP OF WOODBRIDGE, and
TRADEWINDS CONSTRUCTION, INC.,
Defendants.
__________________________________
Argued May 8, 2018 – Decided June 20, 2018
Before Judges Yannotti, Carroll and Mawla.
On appeal from Superior Court of New Jersey,
Law Division, Middlesex County, Docket No. L-
2713-11.
Jerald J. Howarth argued the cause for
appellant (Howarth & Associates, LLC,
attorneys; Jerald J. Howarth and Purnima D.
Ramlakhan, on the briefs).
James G. Serritella argued the cause for
respondent Lucas Construction Group, Inc.
(Biancamano & DiStefano, PC, attorneys; James
G. Serritella, on the brief).
William F. Waldron, Jr., argued the cause for
respondents Frederic R. Harris, Inc., DMJM +
Harris, Inc./AECOM and AECOM (Marshall,
Dennehey, Warner, Coleman & Goggin, attorneys;
William F. Waldron, Jr., and Patricia M.
McDonagh, on the brief).
PER CURIAM
The County of Middlesex (County) appeals from various orders
entered by the trial court, which held that the County was not
entitled to contractual indemnification from defendants Lucas
Construction Group, Inc. (Lucas), or Frederic R. Harris, Inc.,
DMJM + Harris, Inc., DMJM Harris/AECOM, and AECOM (collectively,
AECOM) for attorney's fees it incurred in defending claims brought
against it in an underlying lawsuit. We affirm.
2 A-5272-15T4
I.
This appeal arises from the following facts. Lucas entered
into a contract with the County to provide "all labor, materials,
and equipment" for a bridge replacement project in Avenel, New
Jersey (the Lucas contract). The contract incorporated
Supplementary Specifications and the New Jersey Department of
Transportation (NJDOT) 2001 Standard Specifications for Road and
Bridge Construction (NJDOT Specifications). The contract contained
several indemnity provisions.
AECOM also entered into a contract with the County to provide
professional engineering consulting services in connection with
the bridge replacement project (the AECOM contract). These
services required AECOM to provide a full-time inspector to monitor
Lucas's work, ensure compliance with the plans and specifications
for the project, and prepare and furnish daily reports. The County
was required to provide its own project manager to oversee
operations at the project site as well. The AECOM contract also
contained a contractual indemnity provision.
On August 11, 2009, Luis Carlos Tavares (Tavares) was fatally
injured while working as a laborer for Lucas on the bridge
replacement project. On April 17, 2013, Tavares's estate and his
wife, the administrator of the estate (plaintiffs), filed an
amended complaint naming Lucas, the County, and AECOM as
3 A-5272-15T4
defendants. Lionel Lucas, Antonio Lucas, Consolidated Rail
Corporation (Conrail), the Township of Woodbridge (Township), and
Tradewinds Construction, Inc. (Tradewinds) were also named as
defendants.
Plaintiffs alleged that as a result of the negligence of the
County, Lucas, and AECOM, a 1500 pound steel plate separated from
a Campbell Hook assembly and struck Tavares's head, causing his
death. Plaintiffs also claimed several defendants, including
Lucas, AECOM, and the County, were negligent in failing to inspect,
maintain, repair, and supervise workplace equipment and
components; provide a safe place to work; and establish, provide,
and implement proper training. Plaintiffs further alleged the
County, Lucas, and AECOM permitted unsafe practices at the
workplace, violated accepted construction-site policies and
procedures, and otherwise failed to fulfill contractual
responsibilities regarding the workplace.
Evidence obtained in discovery revealed that Lucas used
damaged construction equipment, including the Campbell Hook
assembly, to lift the 1500 pound plate at the time Tavares was
injured. The hoisting assembly that Lucas used to raise the subject
plate included two hooks, which engaged into holes in the steel
plate. The hooks lacked a safety pin to prevent the plate from
dislodging. Antonio Lucas, who was operating the Caterpillar
4 A-5272-15T4
excavator, which was moving the plate at the time of the incident,
testified that he did not inspect the hooks before use.
AECOM assigned William J. Meister to act as field inspector
for the project. At his deposition, Meister testified that on the
day of the incident he was on vacation and not present at the work
site. Meister claimed he advised Lucas, the County, and his
superiors that he would be on vacation the week in which the
incident occurred. Meister also acknowledged that AECOM was
responsible for Lucas's progress, and "blatant" or "conspicuous"
safety issues.
Ronald M. Sender, a supervising engineer for the County,
testified that it was his and the County's policy or procedure to
ensure coverage if the resident engineer was absent from a work
site. Sender said, "[It is] common practice that if someone is
going on vacation, they say I won't be here, this person will be
. . . doing the inspection and reporting to you." However, when
asked who had responsibility to ensure that a substitute resident
engineer was present, Sender stated "[n]o one at the [C]ounty
would ensure [that]."
On April 25, 2014, the County filed a motion for summary
judgment seeking dismissal of plaintiffs' complaint and all cross-
claims against it, and motions for summary judgment against Lucas
and AECOM for contractual indemnification. Conrail and the
5 A-5272-15T4
Township filed motions for summary judgment, and Lucas, Antonio
Lucas, and Lionel Lucas sought summary judgment on liability. In
addition, Lucas and AECOM filed cross-motions for summary judgment
on the County's claims against them for contractual
indemnification.
On May 13, 2014, the motion judge dismissed the claims against
Conrail, the Township, Antonio Lucas, and Lionel Lucas, and granted
Lucas's motion for summary judgment on liability.1 In addition, on
May 13, 2014, the judge heard oral argument on the County's motion
for summary judgment on the claims asserted against it, which was
denied by order of the same date.
The judge determined that there was a genuine issue of
material fact as to whether the County violated its own policy or
practice in failing to oversee safety at the work site on the day
of the accident. In so ruling, the judge stated:
Sender affirmed that it is . . . general
practice to ensure that there was coverage [at
the work site] if the resident engineer was
away on vacation.
The engineer on site seems to have the
responsibility, in this case with these
1
Lucas obtained liability insurance through Penn National
Insurance Company and initially provided a defense to the County;
however, the County's insurer, Mid-Continent/Great American
Insurance Group, acknowledged that it had issued an Owner's and
Contractor's Protective Policy to the County, and that this policy
was primary. Howarth & Associates, LLC then assumed the defense
of the County.
6 A-5272-15T4
contracts, to ensure that there are no blatant
safety violations. [It is] up to a jury to
decide whether failing to wear a helmet is a
blatant safety violation, or lifting a heavy
metal plate without prior notice . . . is a
blatant safety violation, or utilizing the
hooks that were utilized.
. . . .
I am satisfied that a reasonable jury can
conclude that the [C]ounty violated its
practice of ensuring safety coverage by
failing to make certain that a person was on
site who could have evaluated the safety
hazards.
The County filed a motion for reconsideration. The County
argued that AECOM was not contractually responsible for safety at
the work site, and as such, the County's duty to plaintiff could
be no greater than AECOM's duty. The judge denied the motion.
The judge found that reconsideration was not warranted
because the County had presented "no new material evidence for the
[c]ourt to consider." The judge stated:
Here, the County may also be liable for
failing in its exclusive duty of providing a
replacement for a supervising engineer while
he was away on vacation. I say "may" because
it seems, to me, to be clear that that is a
question of fact and a question . . . for a
fact-finder.
The language of the scope of work for
professional services for this project,
combined with the deposition of [Mr.] Sender,
some of which was read into the record . . .
raises an issue of fact as to whether
7 A-5272-15T4
defendant should have provided a replacement
engineer for Mr. Meister while he was absent.
The County cannot eliminate all questions of
fact relating to its responsibility, direct
or indirect, in this matter. Because it cannot
do so and because none of the material
presented before the [c]ourt appears . . . to
the [c]ourt to be new, the [c]ourt denies the
motion . . . to reconsider its earlier ruling
denying summary judgment.
On June 6, 2014, the judge heard oral argument on the cross-
motions by Lucas, AECOM, and the County for summary judgment on
the indemnification claims. The judge stated he would issue a
written opinion on the matter; however, the judge did not issue
an opinion. Instead, the judge filed various orders dated August
14, 2014, which granted the County's cross-motions for summary
judgment seeking indemnification from Lucas and AECOM, and ruled
that Lucas and AECOM owed contractual indemnity to the County.
On September 2, 2014, AECOM's attorney sent a letter to the
trial court requesting "additional action, clarification, and/or
motion practice" with regard to the August 14, 2014, orders. On
September 11, 2014, the judge acknowledged on the record that the
orders issued on August 14, 2014, were entered in error.
The judge further acknowledged that no decision on the
County's motions on indemnification had been made, and there was
no letter opinion accompanying the orders inadvertently filed on
August 14, 2014. The judge entertained arguments from the County,
8 A-5272-15T4
Lucas, and AECOM on the issue of indemnification, and by order,
dated September 15, 2014, and letter opinion, dated September 16,
2014, the judge vacated the August 14, 2014 orders and denied the
County's motions for summary judgment on the issue of
indemnification.
In October 2014, plaintiffs settled their claims against
AECOM and Tradewinds. Moreover, in November 2014, plaintiffs
provided the County with a stipulation dismissing with prejudice
plaintiffs' claims against the County.
On January 20, 2015, AECOM filed a motion for summary judgment
to dismiss the County's claims against it for indemnification.
Lucas filed a cross-motion seeking similar relief. The County
filed two cross-motions for summary judgment on indemnification
as to Lucas and AECOM, respectively.
On April 17, 2015, another Law Division judge heard oral
argument on the four motions. By order dated June 24, 2015, the
judge granted the motions by Lucas and AECOM, and denied the
County's motions. The County subsequently filed a motion for
reconsideration, which was heard on September 4, 2015. By order
dated July 14, 2016, the judge denied the County's motion. This
appeal followed.
On appeal, the County argues: (1) the matter must be remanded
as the County was entitled to a hearing to establish it was
9 A-5272-15T4
negligence-free and could seek counsel fees pursuant to the
indemnity provisions in the Lucas and AECOM agreements; (2) the
July 14, 2016 order must be reversed because the trial court
erroneously denied the County's motion for summary judgment on
liability; (3) the County is entitled to attorney's fees under
Kieffer v. Best Buy, 205 N.J. 213 (2011); (4) both Lucas and AECOM
must indemnify the County pursuant to the terms of their respective
contracts; (5) the County is entitled to attorney's fees from
Lucas and AECOM on the theory of common law indemnification; and
(6) Lucas owes the County contractual indemnity pursuant to Azurak
v. Corporate Property Investors, 175 N.J. 110 (2003).
II.
Relying upon the court's decision in Central Motor Parts
Corp. v. E.I. duPont deNemours & Co., 251 N.J. Super. 5 (App. Div.
1991), the County first argues the trial court erroneously denied
it the opportunity for a trial, plenary hearing, or "settlement
proceeding" establishing that it had no liability to plaintiffs
and therefore was entitled to indemnification by Lucas and AECOM.
The County contends that where there is no trial or settlement
proceeding establishing liability, the so-called "after-the-fact"
approach requires the trial court to afford the County the
opportunity to prove that it was "fault-free." We disagree.
10 A-5272-15T4
The "after-the-fact" approach, first articulated in Central
Motor, "permits an indemnitee to recover counsel fees if the
indemnitee is adjudicated to be free from active wrongdoing
regarding the plaintiff's injury, and has tendered the defense to
the indemnitor at the start of the litigation." Mantilla v. NC
Mall Assocs., 167 N.J. 262, 273 (2001) (citing Cent. Motor, 251
N.J. Super. at 11).
"[A]n indemnitee who defends exclusively against the acts of
the indemnitor may recoup from the indemnitor the reasonable costs
of its defense." Cent. Motor, 251 N.J. Super. at 10 (emphasis in
original). "Costs incurred by a[n] [indemnitee] in defense of its
own active negligence or independent warranties are not
recoverable, but those costs incurred on defending claims on which
the [indemnitee] is found only derivatively or vicariously liable
are recoverable." Id. at 11.
The purpose of the "after-the-fact" approach is not to
determine whether an indemnitee is ultimately "fault-free." Id.at 10–12. Rather, it is for determining whether an indemnitee has
defended against claims of its own independent fault or the fault
of the indemnitor. Ibid. A settlement proceeding fixing liability
is only necessary where the "indemnitee incurred legal costs
defending its vicarious liabilities." Id. at 12–13.
11 A-5272-15T4
Here, the record shows that at all times throughout this
litigation, the County has solely been defending against
plaintiffs' claims against the County for its own alleged acts of
negligence. Plaintiffs did not claim that the County was only
derivatively or vicariously liable for the alleged negligence of
Lucas or AECOM.
Thus, even if the County were adjudicated "fault-free" on the
claims asserted against it for its own alleged independent acts
of negligence, the County still would not be entitled to
contractual indemnity from AECOM or Lucas for the attorney's fees
incurred in defending against those claims. Accordingly, the trial
court did not err by failing to conduct an evidentiary hearing to
determine if the County was "fault-free."
III.
Next, the County argues that the trial court erred by denying
its initial motion for summary judgment on the claims plaintiffs
asserted against it in the amended complaint, and by thereafter
denying its motion for reconsideration. Again, we disagree.
Summary judgment must be granted if "there is no genuine
issue as to any material fact challenged and that the moving party
is entitled to a judgment or order as a matter of law." R. 4:46-
2(c). "An issue of fact is genuine only if, considering the burden
of persuasion at trial, the evidence submitted by the parties on
12 A-5272-15T4
the motion, together with all legitimate inferences therefrom
favoring the non-moving party, would require submission of the
issue to the trier of fact." Ibid.In reviewing a trial court's decision to grant or deny a
motion for summary judgment, we conduct a de novo review, using
"the same standard as the trial court." Templo Fuente De Vida
Corp. v. Nat'l Union Fire Ins. Co. of Pitt., 224 N.J. 189, 199
(2016). We must determine whether there are substantial, genuinely
disputed issues of fact, and not simply issues of an "immaterial
or . . . insubstantial nature." Brill v. Guardian Life Ins. Co.
of Am., 142 N.J. 520, 540 (1995). The non-moving party cannot
defeat a summary judgment motion "merely by pointing to any fact
in dispute." Ibid.Here, plaintiffs asserted claims against the County for its
alleged negligence in failing to follow its own policies,
procedures, and practices with regard to supervision of the
worksite. Under its contract with AECOM, the County was required
to provide its own project manager to oversee the operations at
the work site, and AECOM was required to prepare and furnish daily
reports to the County, creating an ongoing dialogue between Meister
and Sender.
The trial court correctly found that there was a genuine
issue of material fact as to whether the County retained control
13 A-5272-15T4
over the work site and whether the County provided the proper
supervision of the work. Thus, the trial court did not err by
denying the County's motion for summary judgment on the claims
plaintiffs asserted against the County in their amended complaint.
Moreover, the County has failed to establish that the trial
court erred by denying its motion for reconsideration of the order
denying summary judgment. A motion for reconsideration is
committed to the sound discretion of the court, which should be
"exercised in the interest of justice." Cummings v. Bahr, 295 N.J.
Super. 374, 384 (App. Div. 1996) (quoting D'Atria v. D'Atria, 242
N.J. Super. 392, 401 (Ch. Div. 1990)).
Reconsideration is appropriate only when a court has rendered
a decision "based upon a palpably incorrect or irrational basis,"
or failed to consider or "appreciate the significance of probative,
competent evidence." Ibid. (quoting D'Atria, 242 N.J. Super. at
401-02). Here, the County failed to show that in denying summary
judgment, the court had ruled on an incorrect or irrational basis,
or failed to appreciate probative and competent evidence.
Therefore, the court did not err by denying the County's motion
for reconsideration.
IV.
The County argues the trial court erroneously relied upon the
"risk-shifting analysis" of Azurak and Mantilla, rather than the
14 A-5272-15T4
"after-the-fact" approach enunciated in Kieffer and Central Motor
for "fault-free" indemnitees that seek "counsel fees only." The
County therefore argues that the trial court erred by denying its
motion for summary judgment and granting the motions by Lucas and
AECOM for summary judgment on the issue of indemnification.
Central Motor established that the trial court should review
the record to determine whether an indemnitee has incurred costs
defending against claims against the indemnitor or claims against
the indemnitee. 251 N.J. Super. at 11. "Central Motor expresses
the common-law principle that 'an indemnitee who has defended
against allegations of its independent fault may not recover its
[defense] costs.'" Mantilla, 167 N.J. at 272 (quoting Cent. Motor,
N.J. Super. at 10).
In Mantilla, the Court held that an indemnitee cannot recover
legal expenses incurred in defending itself against independent
claims based upon its own negligence unless the parties explicitly
agree otherwise. Id. at 275. In that case, a patron brought a
negligence claim against the owner of a shopping mall and its
janitorial-services contractor. Id. at 264. The case went to trial
and the jury returned a verdict finding the owner forty-percent
at fault, the contractor fifty-percent at fault, and the plaintiff
ten-percent at fault. Id. at 265. The owner then sought
indemnification from the janitorial-services contractor. Ibid.15 A-5272-15T4
The Court held, however, that "absent explicit contractual
language to the contrary, an indemnitee who has defended against
allegations of its own independent fault may not recover the costs
of its defense from an indemnitor." Id. at 275. In addition, as
previously stated, the Court adopted the "after-the-fact" approach
previously articulated in Central Motor. Id. at 273 (citing Central
Motor, 251 N.J. Super. at 10–11).
In Azurak, the Court reaffirmed the principles enunciated in
Mantilla, and held that a "broad form" indemnification clause,
which attempted "to include an indemnitee's negligence within an
indemnification agreement without explicitly referring to the
indemnitee's 'negligence' or 'fault,' . . . is no longer good
law." 175 N.J. at 112. The Court stated that Mantilla reaffirmed
the "'bright line' rule requiring 'explicit language' that
indemnification and defense shall include the indemnitee's own
negligence." Ibid. (quoting Azurak v. Corp. Prop. Inv'rs, 347 N.J.
Super. 516, 523 (App. Div. 2002)).
Most recently, in Kieffer, the Court considered the terms of
an indemnification agreement executed between a property owner and
a cleaning contractor, and another indemnification agreement
between the cleaning contractor and a sub-contractor. 205 N.J. at
216. The trial on the plaintiff's negligence claims resulted in a
no-cause verdict for all three defendants. Ibid. The trial court
16 A-5272-15T4
held, however, that the sub-contractor must indemnify the
contractor and, in turn, the property owner. Id. at 220.
The Court held that the trial court erred by requiring the
sub-contractor to indemnify the contractor and, ultimately, the
property owner. Id. at 217. The Court determined that the sub-
contract did not require the sub-contractor to indemnify the
contractor and the property owner for their legal costs in the
absence of a determination that plaintiff's injuries were caused
by the sub-contractor's "negligence, omission, or conduct." Ibid.The trial court never made a finding of negligence, and therefore,
the sub-contractor was not contractually responsible for paying
the defense costs of the property owner and contractor. Id. at
225.
In this case, the County argues that it is not seeking
indemnification for its own negligence, but rather, that it is
only seeking attorney's fees based on the language of the contract.
The County further argues that Kieffer applies in this case because
it has essentially been found to be "fault-free." Again, we
disagree.
As stated previously, plaintiffs' amended complaint set forth
independent claims of negligence against the County arising from
the County's own alleged acts of negligence, and the County moved
for summary judgment to dismiss these claims. The trial court
17 A-5272-15T4
found, however, that there were genuine issues of material fact
regarding the County's potential liability for its own independent
acts of negligence.
Moreover, in the amended complaint, plaintiffs did not assert
that the County was derivatively or vicariously liable for the
alleged negligence of Lucas or AECOM. The record shows that
throughout the litigation, the County has been defending against
allegations of its own negligence. Therefore, the County's
reliance on Kieffer is misplaced.
We conclude the trial court engaged in the proper analysis
in reviewing the County's motions for summary judgment seeking
contractual indemnification from Lucas and AECOM, and correctly
decided as a matter of law that the County is not entitled to
reimbursement of its attorney's fees. The court correctly
determined that the County incurred the fees defending against
claims of its own independent negligence and not defending claims
of derivative or vicarious liability.
Therefore, the trial court did not err by granting Lucas's
and AECOM's motions for summary judgment on the County's claims
for indemnification, and denying the County's motions for summary
judgment seeking indemnification from Lucas and AECOM.
18 A-5272-15T4
V.
The County further argues that it is entitled to
indemnification for its attorney's fees pursuant to its agreements
with Lucas and AECOM.
The interpretation of a contract is a legal question, which
is reviewed de novo by this court, and "[a] trial court's
interpretation of the law and the legal consequences that flow
from established facts are not entitled to any special deference."
Kieffer, 205 N.J. at 222–223 (quoting Manalapan Realty, LP v. Twp.
Comm., 140 N.J. 366, 378 (1995)). Therefore, an appellate court
must "look at the contract with fresh eyes." Id. at 223.
"The objective in construing a contractual indemnity
provision is the same as in construing any other part of a contract
– it is to determine the intent of the parties." Ibid. (citing
Mantilla, 167 N.J. at 272). "The judicial task is simply
interpretative; it is not to rewrite a contract for the parties
better than or different from the one they wrote for themselves."
Ibid. The court must give contractual terms "their plain and
ordinary meaning." Ibid. (quoting M.J. Paquet, Inc. v. N.J. Dep't
of Transp., 171 N.J. 378, 396 (2002)).
As a general rule, an indemnity contract "will not be
construed to indemnify the indemnitee against losses resulting
from its own negligence unless such an intention is expressed in
19 A-5272-15T4
unequivocal terms" in the agreement. Ramos v. Browning Ferris
Indus., Inc., 103 N.J. 177, 191 (1986) (citing Longi v. Raymond-
Commerce Corp., 34 N.J. Super. 593, 603 (App. Div. 1955)).
"A party ordinarily is responsible for its own negligence,
and shifting liability to an indemnitor must be accomplished only
through express and unequivocal language." Kieffer, 205 N.J. at
224. "[A]bsent statutory or judicial authority or express
contractual language to the contrary, each party is responsible
for its own attorney's fees." Ibid. Moreover, if the meaning of
an indemnity provision in a contract is ambiguous, the provision
should be "strictly construed against the indemnitee." Id. at 223(quoting Mantilla, 167 N.J. at 272).
A. The Lucas Contract
The County relies upon three paragraphs in the Lucas contract
to support its claim for contractual indemnity. The County first
relies on paragraph 107.22 of the Supplementary Specifications,
which provides:
The contractor shall save, protect, indemnify
and hold harmless . . . [Conrail], [the
County], its employees and/or agents from any
and all injuries or claims for injuries or
damages to persons or property caused by the
Contractor or its employees, agents and/or
subcontractors in undertaking the work
contemplated by these bid specifications. The
indemnification/hold harmless provided to the
County hereunder shall survive the completion
20 A-5272-15T4
of the work and final acceptance of the
project by the Board of Chosen Freeholders.
Next, the County cites the "Sanitary, Health and Safety
Provisions," of the NJDOT Specifications, which were incorporated
by reference in the contract. Under subsection 107.10(B)(1)(b) of
the NJDOT Specifications, "[t]he Contractor is solely responsible
for creating, implementing, and monitoring [a] [Safety] Program."
Further, paragraph 107.10(B)(2) states that
[t]he Contractor is solely responsible for all
aspects of the [p]rogram including, but not
limited to, the development, revision,
implementation, monitoring, and updating of
the [p]rogram. Pursuant to Subsection 107.22,
the [c]ontractor shall defend, indemnify, and
save harmless the [County] from any and all
liability from any actions arising directly
or indirectly or alleged to arise from the
[p]rogram.
In addition, the County relies upon subsection 107.22(2),
"Risks Assumed by the Contractor," of the NJDOT Specifications,
which provides:
The [c]ontractor shall bear the risk of
claims, just or unjust, by third persons made
against the [c]ontractor or the [County], on
account of injuries (including wrongful
death), loss or damage of any kind whatsoever
arising or alleged to arise out of or in
connection with the performance with the
[w]ork. The risk of claims, whether or not
actually caused by or resulting from the
performance of the [w]ork or out of or in
connection with the [c]ontractor's operations
or presence at or in the vicinity of the
construction site or [County] premises,
21 A-5272-15T4
whether such claims are made and whether such
injuries, loss, and damages are sustained,
applies at any time both before and after
[a]cceptance.
However, the indemnification language contained in these
three provisions of the Lucas contract falls short of the explicit,
"bright-line" contractual language required for indemnification
of an indemnitee's own alleged acts of negligence. Paragraph 107.22
of the Supplementary Specifications does not mention the County's
negligence. Rather, paragraph 107.22 states that Lucas shall
indemnify the County from any and all injuries, claims, injuries,
or damages to persons or property caused by Lucas's own negligence.
Subsection 107.10 of the NJDOT Specifications also does not
mention the County's negligence. Instead, this provision requires
Lucas to implement a safety program, states that Lucas is solely
responsible for all aspects of the program, and directs Lucas to
"defend, indemnify, and save harmless the [County] from any and
all liability from any actions arising directly or indirectly or
alleged to arise from the [p]rogram" pursuant to subsection 107.22.
The agreement does not expressly state that Lucas shall indemnify
the County for any actions that may arise from its own negligence
with regard to the program.
Furthermore, subsection 107.22 of the NJDOT Specifications
does not clearly and unequivocally impose on Lucas an obligation
22 A-5272-15T4
to indemnify the County for its own negligence. Indeed, the
indemnification language in subsection 107.22 is similar to the
indemnity provision at issue in Mantilla. 167 N.J. at 266.
That provision stated, "Contractor shall indemnify and save
Owner harmless from any and all loss, cost, expense, damages,
claims and liability for bodily injury, death or property damage
occurring in and about the Shopping Center as a result of the work
performed and materials and equipment installed or furnished by
Contractor hereunder." Ibid. As the Mantilla Court held, this
language does not provide for indemnification for claims arising
out of the indemnitee's own negligence. Id. at 276. The same
conclusion applies in this case.
In addition, there is no ambiguity in the contract on the
issue of whether Lucas must indemnify the County for the County's
own negligence. Even if the agreement was ambiguous, any ambiguity
on the issue of indemnification must be "strictly construed against
the indemnitee." Kieffer, 205 N.J. at 223 (quoting Mantilla, 167
N.J. at 272).
B. The AECOM Contract
In support of its claim for indemnification against AECOM,
the County relies upon paragraph 120 of the AECOM contract,
"Responsibility for Claims and Liability," which states in
pertinent part that AECOM
23 A-5272-15T4
shall indemnify and save harmless . . . [the
County], its officers, agents and employees
from and against any and all claims, suits,
actions, damages, losses, demands and costs
of every name and description resulting from
or claimed to result from any negligent act,
error or omission of [AECOM] and/or any of its
Subconsultant(s)/Subcontractor(s) in the
performance of services or resulting from the
non-performance of the [c]onsultant and/or any
of its Subconsultant(s)/Subcontractor(s) of
any of the covenants and specifications of
this [p]roposal, including any supplements
thereto, and such [indemnification] shall not
be limited by reason of any insurance
coverage. The [c]onsultant shall provide all
professional services required by the County
in defending all claims against the County
which relate in any way to alleged errors,
omissions or alleged failure to supervise by
the [c]onsultant arising out of this contract
without additional compensation. The County
shall recover from the [c]onsultant its
attorney's fees, expert witness costs, cost
of consultant(s) necessary for evaluation of
the project, and any other costs incurred.
This provision of the AECOM contract does not, however,
include language that meets the "bright-line" standard required
to compel indemnification for an indemnitee's own alleged acts of
negligence. The contract does not contain any reference to the
County's negligence. Rather, the indemnification clause expressly
focuses on AECOM's negligence and only requires AECOM to indemnify
the County for any claims or damages arising from AECOM's
negligence.
24 A-5272-15T4
Moreover, there is no ambiguity in the contract with regard
to indemnification of the County for its own negligence. Even if
the indemnification clauses were ambiguous, any ambiguity must be
"strictly construed against the indemnitee." Kieffer, 205 N.J. at
223 (quoting Mantilla, 167 N.J. at 272).
We therefore conclude the County is not entitled to
contractual indemnification for the attorney's fees the County
incurred in defending the claims asserted against the County based
on its own negligence.
VI.
The County also argues that it is entitled to common law
indemnification from Lucas and AECOM for the attorney's fees it
incurred in this lawsuit. Again, we disagree.
In Central Motor, we held that "[a] common-law indemnitee,
forced to defend claims for which its liability is only vicarious,
is entitled not only to the cost of any judgment or reasonable
settlement, but also to costs of defense occasioned by the
indemnitor's fault." 251 N.J. Super. at 9. However, "the right of
indemnity is granted only to those whose liability is secondary
and not primary, i.e., whose negligence is not morally culpable
but is merely constructive, technical, imputed or vicarious." Pub.
Serv. Elec. & Gas Co. v. Waldroup, 38 N.J. Super. 419, 432 (App.
Div. 1955). Moreover, common law indemnity is applicable only in
25 A-5272-15T4
the absence of an express agreement between parties. Promaulayko
v. Johns Manville Sales Corp., 116 N.J. 505, 511 (1989).
Here, the Lucas and AECOM contracts establish the
relationships between the parties with regard to indemnification.
As we have determined, the County is not entitled to
indemnification under either contract for the costs it incurred
in defending claims asserted against the County for its own
negligence.
Furthermore, the record does not support the County's
assertion that it incurred the legal costs defending claims of
derivative or vicarious liability. Plaintiffs did not assert any
claims against the County for such liability. Therefore, the County
is not entitled to common law indemnification from Lucas or AECOM
for reimbursement of the counsel fees it incurred in this lawsuit.
Finally, the County argues that under Azurak, Lucas owed it
contractual indemnity for the County's own negligence. We find the
County's arguments on this issue lack sufficient merit to warrant
discussion. R. 2:11-3(e)(1)(E).
Affirmed.
26 A-5272-15T4