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Frazer v. A.f. Munsterman

OPINION FILED JULY 25, 1986.

DORIS FRAZER, PLAINTIFF-APPELLEE,

v.

A.F. MUNSTERMAN, INC., DEFENDANT AND THIRD-PARTY PLAINTIFF-APPELLANT (IRIS G. DOUGHERTY ET AL., D/B/A CROFT TRAILER AND HITCH COMPANY, ET AL., THIRD-PARTY DEFENDANTS-APPELLEES; IRIS G. DOUGHERTY ET AL., D/B/A CROFT TRAILER AND HITCH COMPANY, DEFENDANTS, THIRD-PARTY APPELLANTS; KEITH ALLEN, THIRD-PARTY DEFENDANT-APPELLEE).



Appeal from the Circuit Court of Du Page County; the Hon. Richard J. Lucas and the Hon. Bruce R. Fawell, Judges, presiding. JUSTICE SCHNAKE DELIVERED THE OPINION OF THE COURT:

These consolidated appeals involve various claims arising out of an automobile collision in which plaintiff, Doris Frazer, was injured when her car was struck by a trailer that had become disengaged from the pickup truck pulling it. Because of settlement which occurred while this case was pending on appeal, the sole issue remaining to be decided is whether the enactment of "An Act in relation to contribution among joint tortfeasors" (Contribution Act) (Ill. Rev. Stat. 1979, ch. 70, par. 301 et seq.) abolished the cause of action for implied indemnity based on upstream strict products liability.

On April 15, 1980, plaintiff was injured when a low-boy trailer broke loose from a pickup truck, crossed the center line of Roosevelt Road in Wheaton, and collided with her vehicle which was traveling in the opposite direction. Plaintiff brought suit against A.F. Munsterman, Inc. (Munsterman), owner of the trailer, Keith Allen, driver and owner of the pickup truck, Robert Sosnowski, alleged to have attached the trailer to the Allen truck, Iris Dougherty and the George Croft Trust, d/b/a Croft Trailer and Hitch Company (Croft), purported seller of the pintle hook/trailer hitch to Munsterman, Ring Brothers, Inc. (Ring), purported seller of the pintle hook/trailer hitch to Croft, and Beck Corporation (Beck), purported manufacturer and seller of the trailer to Munsterman. Third-party defendant, Dico, Inc. (Dico), purported manufacturer of the trailer's braking system, was later brought into the action by Munsterman and Beck.

While numerous third-party complaints and counterclaims were filed between the defendants, only two are at issue on appeal. They are: (1) Munsterman's indemnity claim against Croft, Ring, Beck (strict products liability and breach of implied warranty) and Dico (strict products liability); and (2) in the event Munsterman's implied indemnity action is allowed, Croft's counterclaim against Allen for contribution as to liability in excess of the settlement.

Prior to trial, Croft, Beck, Ring and Dico entered into a settlement agreement with plaintiff in the amount of $60,000. After Munsterman withdrew his objection to the settlement, the trial court found the settlement to be in good faith. The court then dismissed Croft, Beck, Ring and Dico as defendants and dismissed Munsterman's third-party complaint for contribution. The court had previously ordered that all counterclaims and third-party claims be severed from the underlying action, and plaintiff's action against Munsterman, Allen and Sosnowski proceeded to trial. During the trial, Sosnowski was dismissed as a defendant on plaintiff's motion after he testified that he had nothing to do with attaching the trailer to Allen's truck.

At the close of all the evidence, the trial court directed a verdict in plaintiff's favor against Munsterman on the strict-products-liability count of her complaint. The court found that the pintle hook/trailer hitch was in an unreasonably dangerous condition at the time it left Munsterman's control. The court then submitted the case to the jury on plaintiff's negligence claims against Munsterman and Allen. The jury returned a verdict in favor of Allen but against Munsterman in the amount of $365,538.03. The court entered judgment on the verdict after reducing the amount by $60,000.

After trial, the court dismissed Munsterman's strict-products-liability and breach-of-implied-warranty claims against Croft, Ring, Beck and Dico. The court held that the enactment of the Contribution Act had abolished all actions for implied indemnity in Illinois. The court also dismissed Croft's claim against Allen for contribution in the event that Munsterman's indemnity claim was allowed.

Munsterman appealed separately from the judgment entered against it on the jury's verdict and from the trial court's order dismissing its strict-liability and breach-of-implied-warranty claims. Croft also appealed from the order dismissing its contribution claim against Allen in the event Munsterman's indemnity is allowed. By order of this court, the three appeals were consolidated. While this case was pending on appeal, Munsterman settled with plaintiff so that the sole remaining issue on appeal is the propriety of the trial court's dismissal of its strict-products-liability and breach-of-implied-warranty claims.

Prior to 1977, Illinois adhered to the common law rule barring contribution between joint tortfeasors. In that year, our supreme court overturned the long-standing rule against contribution in Skinner v. Reed-Prentice Division Package Machinery Co. (1977), 70 Ill.2d 1, cert. denied (1978), 436 U.S. 946, 56 L.Ed.2d 787, 98 S.Ct. 2849. In 1979, the General Assembly codified Skinner by adopting the Contribution Act. (Doyle v. Rhodes (1984), 101 Ill.2d 1, 8-9.) The issue now before this court is what effect, if any, the Contribution Act has on the common law doctrine of implied indemnity.

The question of whether the Contribution Act extinguished the common law doctrine of implied indemnity has generated considerable discussion among the courts and commentators.

While acknowledging the debate, our supreme court has not yet decided the issue. (Van Slambrouck v. Economy Baler Co. (1985), 105 Ill.2d 462, 470-71; Simmons v. Union Electric Co. (1984), 104 Ill.2d 444, 453-54; Heinrich v. Peabody International Corp. (1984), 99 Ill.2d 344, 350-51.) In Allison v. Shell Oil Co. (1986), 113 Ill.2d 26, our supreme court declared an end to the concept of active-passive indemnity, but declined to include products-liability litigation in that ruling.

• 1 The decisions of the appellate court have generally agreed that the Contribution Act has extinguished actions based upon the active-passive theory of implied indemnity. (Heinrich v. Peabody International Corp. (1985), 139 Ill. App.3d 289; Allison v. Shell Oil Co. (1985), 133 Ill. App.3d 607; Holmes v. Sahara Coal Co. (1985), 131 Ill. App.3d 666; Morizzo v. Laverdure (1984), 127 Ill. App.3d 767; Lowe v. Norfolk & Western Ry. Co. (1984), 124 Ill. App.3d 80; Van Jacobs v. Parikh (1981), 97 Ill. App.3d 610.) The cases, however, split on whether the Contribution Act also extinguished the implied indemnity actions involving a pretort relationship between the parties which gives rise to a duty to indemnify (e.g., lessor-lessee, employer-employee), or upstream claims in strict products liability. (Compare Heinrich v. Peabody International corp. (1985), 139 Ill. App.3d 289, Holmes v. Sahara Coal Co. (1985), 131 Ill. App.3d 666, and Morizzo v. Laverdure (1984), 127 Ill. App.3d 767, 775 (Downing, J., concurring) with Allison v. Shell Oil Co. (1985), 133 Ill. App.3d 607, Lowe v. Norfolk & Western Ry. Co. (1984), 124 Ill. App.3d 80, and Van Jacobs v. Parikh (1981), 97 Ill. App.3d 610.) This appeal presents the first opportunity for this court to rule on this issue.

We believe that the effect of the Contribution Act was to completely abolish the doctrine of implied indemnity. We base our decision upon the purposes and legislative history of the Contribution Act and the historical development of the doctrine of implied indemnity.

• 2-5 In construing a statute, it is fundamental that the judicial role is to ascertain the intent of the legislature and give it effect. (City of Springfield v. Board of Election Commissioners (1985), 105 Ill.2d 336, 340-41.) In ascertaining the intent of the legislature, it is proper for the court not only to consider the language employed by the legislature, but also to look to the reason and necessity for the law, the evils to be remedied, and the objects and purposes to be obtained. (People v. Steppan (1985), 105 Ill.2d 310, 316.) The two primary purposes of the Contribution Act are the equitable sharing of damages and the encouragement of settlement. (Heinrich v. Peabody International Corp. (1985), 139 Ill. App.3d 289, 296.) We find the continued existence of the doctrine of implied indemnity inconsistent with both of these purposes.

• 6, 7 Contribution and implied indemnity are distinct theories of recovery. Both their elements and their measure of damages are different. (Heinrich v. Peabody International Corp. (1984), 99 Ill.2d 344, 349-50.) Contribution requires that two or more parties share responsibility for an injury, and it proceeds from the theory that each party should contribute to the judgment in proportion to his or her responsibility. (Heinrich v. Peabody International Corp. (1985), 139 Ill. App.3d 289, 291.) Implied indemnity, on the other hand, shifts the entire burden of the judgment to one party. The theory underlying implied indemnity is that the law will place the ultimate liability upon the party whose fault was the primary cause of the injury. (139 Ill. App.3d 289, 291.) In our view, the duty to share damages in proportion to responsibility is fundamentally ...


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