APPEAL from the Circuit Court of Cook County; the Hon. JAMES
A. GEROULIS, Judge, presiding.
MR. JUSTICE LORENZ DELIVERED THE OPINION OF THE COURT:
Rehearing denied January 23, 1981.
Third-party defendant, L.J. Columbe & Son Construction Co., Inc. (Columbe), appeals from the trial court's judgment which granted a directed verdict in favor of third-party plaintiffs, Fragman Construction Co. (Fragman), Childrens Bargain Town USA, Inc. (Bargain Town), and Toys "R" Us. This action arises out of a claim for indemnity by third-party plaintiffs, the general contractor and owners of a building under construction, against third-party defendant, a subcontractor and the employer of the original plaintiff (Kleeman), with whom said third-party plaintiffs effected a settlement of his claim for damages under the Structural Work Act. Ill. Rev. Stat. 1971, ch. 48, par. 60 et seq.
The following issues are raised for our review: (1) whether the judgment entered by the trial court prior to the directed verdict which permitted plaintiff to settle his action against the owners and general contractor adequately protected the lien of the employer; (2) whether the trial court erred in allowing judgment by way of indemnity for the owners and general contractor against the employer in an amount equal to the cash settlement to plaintiff plus the amount recovered by plaintiff from his workmen's compensation benefits; (3) whether the trial court erred in ruling on certain evidentiary objections; and (4) whether the trial court erred in granting a directed verdict in favor of third-party plaintiffs.
On November 10, 1972, plaintiff sustained injuries when he fell while installing shelving during the construction of a store in Burbank, Illinois. Plaintiff brought an action under the Structural Work Act (Ill. Rev. Stat. 1971, ch. 48, pars. 60-69) against the owners and general contractor. Both the owners and general contractor then filed third-party actions for indemnity against Columbe, plaintiff's employer. On January 9, 1979, the owners and general contractor petitioned the court for a consent judgment between themselves and plaintiff, agreeing to compensate plaintiff in the sum of $40,000 in exchange for a dismissal of his action against them with prejudice. Third-party plaintiffs further agreed by this petition to pay, upon application of Columbe, the lien amount owing to Central Mutual Insurance Co., Columbe's compensation carrier. Plaintiff was held harmless by third-party plaintiffs from any actions to collect this lien amount. The order of the trial court entered on the same day approved the terms of the petition. In conforming with the agreement, it provided that upon application of Columbe for the use of its compensation carrier, "said party shall be compensated in accordance with the applicable statute [Ill. Rev. Stat. 1971, ch. 48, par. 138.5]."
The case then proceeded to trial on the indemnity action of the owners and general contractor against the employer. There is little dispute as to the trial testimony adduced from the four witnesses called by third-party plaintiffs or from the one witness called by third-party defendant.
Plaintiff testified that on November 10, 1972, he was employed as a carpenter for Columbe and was installing shelving at a height of 12 to 13 feet around the inside perimeter of the owner's building. He was kneeling on a section of the shelving, attempting to "level it out," when the shelving gave way, causing him to fall to the ground. Temporary 2 x 4 supports or T-Braces called "kickers" were being used at this time to brace the outer edge of the shelving from the floor.
Robert Drapak, an apprentice carpenter working with plaintiff, saw plaintiff kneeling on the outer edge of the shelf when it depressed, expelling plaintiff to the floor. Drapak later stated that the plywood upon which plaintiff was working gave way because the T-Brace supporting it was out of place.
Alex Wyroski was the construction superintendent for Fragman on the jobsite and was responsible for ensuring that the various subcontractors performed their jobs according to specifications. Although he was at the site on November 10, 1972, he did not witness the incident.
Edward Stevenson, employed as a supervisor in charge of the safety inspection division of the Illinois Department of Labor from 1965 to 1974, testified that Columbe's construction practices at the jobsite were in violation of safety standards in two respects. First, there were no perimeter guards or safety rails erected on the shelving being used as a temporary scaffold. Second, a rolling scaffold should have been furnished as a means of performing the work in question.
Wyroski was called for adverse examination by third-party defendant pursuant to section 60 of the Illinois Civil Practice Act. (Ill. Rev. Stat. 1979, ch. 110, par. 60.) He was the only employee of Fragman on the job with the exception of a laborer named Carter who did cleanup work. Wyroski was Fragman's construction superintendent and not a safety man.
Third-party defendant initially contends that the trial court's judgment order which permitted plaintiff to settle his action against third-party plaintiffs inadequately protected its lien for compensation benefits.
In Illinois, an employer has a right to recover reimbursement of compensation payments from the proceeds of an action filed by the employee against a third party by virtue of the Workmen's Compensation Act (the Act). (Ill. Rev. Stat. 1971, ch. 48, par. 138.5.) Section 5(b) of the Act provides in part:
"* * * if the action against such other person is brought by the injured employee or his personal representative and judgment is obtained and paid, or settlement is made with such other person, either with or without suit, then from the amount received by such employee or personal representative there shall be paid to the employer the amount of compensation paid or to be paid by him to such employee * * *." (Ill. Rev. Stat. 1971, ch. 48, par. 138.5.)
Subparagraph (b) of section 5 further describes the employer's entitlement to a lien on the proceeds secured by the employee against the third parties:
"If the injured employee or his personal representative agrees to receive compensation from the employer or accept from the employer any payment on account of such compensation, or to institute proceedings to recover the same, the employer may have or claim a lien upon any award, judgment or fund out of which such employee might ...