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12/28/89 Roger Owens, v. Midwest Tank and

December 28, 1989





Company, Third-Party Defendant-Appellee)

549 N.E.2d 774, 192 Ill. App. 3d 1039, 140 Ill. Dec. 123 1989.IL.2040

Appeal from the Circuit Court of Cook County; the Hon. Myron T. Gomberg, Judge, presiding.


PRESIDING JUSTICE JIGANTI delivered the opinion of the court. LINN and McMORROW, JJ., concur.


The plaintiff, Roger Owens, filed a product liability action against the defendant Midwest Tank and Manufacturing Company (Midwest) alleging that he was injured as a result of a defective asphalt storage silo manufactured by Midwest. Midwest then filed a third-party complaint against the plaintiff's employer, Tyrolt, Inc., d/b/a Dunn Company (Dunn). Count I of the third-party complaint sought indemnity pursuant to a contractual provision which required Dunn to indemnify Midwest for any injury resulting in whole or in part from an unauthorized modification or misuse of the silo. The trial court granted Dunn's motion to dismiss count I for failure to state a cause of action for indemnity. Following the parties' settlement of the remaining claims, Midwest has appealed the dismissal of its indemnity count. Midwest contends on appeal that the indemnity provision is sufficiently clear and specific to be enforceable, that it is not illusory and that enforcement of the provision would not violate public policy.

The complaint filed by the plaintiff against Midwest alleged that Midwest "designed, manufactured, sold and installed" an asphalt storage silo. During the course of his employment with Dunn, the plaintiff was cleaning the interior of the silo and was injured when the doors at the bottom of the silo closed upon him. The complaint alleged that the silo was in the same condition as at the time of its manufacture and that it was unreasonably dangerous in four respects: (1) there was no control mechanism at the bottom of the silo or near the silo doors by which the doors could be opened; (2) there was no method to shut down the hydraulic system for the doors without turning off the entire system; (3) the only way to open the doors was to have a person in a booth depress a button; and (4) it was foreseeable that asphalt would become lodged between certain beams in the silo and that workmen would go between the silo doors to dislodge it.

Midwest filed a two-count third-party complaint against Dunn. Count II was for contribution and is not a subject of this appeal. Count I was for express indemnity based upon a contractual provision contained in the detail specifications for the asphalt production plant manufactured by Midwest and sold to Dunn. The language of the provision is as follows:

"The Customer [Dunn] agrees that if any damage or injury (including death) to person or property (including the loss or use thereof) results in whole or in part from a modification or alteration of the equipment purchased from the Company [Midwest] which is made without the Company's written approval or consent or which results from improper or abnormal operation of such equipment without the company's written approval or consent, then in any such event the Customer will indemnify and save the Company harmless from all liability, cost and expense (including costs of litigation and defense) for which the Company may be held liable in connection with such damage or injury."

Midwest's complaint then alleged that the plaintiff's injuries resulted in whole or in part from either a modification or alteration or from improper or abnormal operation of the asphalt production plant and that Dunn was accordingly required to indemnify Midwest from any liability resulting from the plaintiff's strict liability action.

Dunn filed a motion to dismiss the third-party complaint pursuant to section 2-615 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2-615). With respect to count I, the motion to dismiss alleged that the language of the indemnity agreement was ambiguous and therefore insufficient to require indemnity where Midwest was sued for strict product liability. The motion also alleged that Midwest could not state a claim for indemnity based on allegations of modification or misuse, because if the allegations were proved true, Midwest could not be held liable and there would be no basis for indemnity. The court granted the motion to dismiss, and Midwest has appealed, contending that the allegations of its third-party complaint against Dunn sufficiently set forth a cause of action for indemnity.

Midwest's complaint should not have been dismissed unless it clearly appeared from the pleadings that no set of facts could have been proved which would have entitled Midwest to relief. (Patton v. T.O.F.C., Inc. (1979), 79 Ill. App. 3d 94, 98, 398 N.E.2d 313.) The issue before us involves interpretation of a written contract provision, which is a question of law subject to de novo review by this court. Kerr Steamship Co. v. Chicago Title & Trust Co. (1983), 120 Ill. App. 3d 998, 1007, 458 N.E.2d 1009.

Dunn's motion to dismiss challenged the indemnity provision on two bases. First, Dunn alleged that the provision was not sufficiently specific to be construed as an agreement to indemnify Midwest against its own strict liability. Second, Dunn alleged that the provision was illusory because it called for indemnity only where the product was modified or misused; however, because modification and misuse are defenses to a product liability action, ...

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