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08/23/96 ARDIS LICCARDI v. STOLT TERMINALS

August 23, 1996

ARDIS LICCARDI, INDIV. AND AS SPECIAL ADM'R OF THE ESTATE OF ARTHUR FARMER, DECEASED, JUSTIN FARMER, LARRY FARMER, KENNETH FARMER, JAMES FARMER, ARDIS FARMER, ANTOINETTE LICCARDI, AND MELISSA FARMER, PLAINTIFFS,
v.
STOLT TERMINALS (CHICAGO), INC., DEFENDANT AND THIRD-PARTY PLAINTIFF-APPELLANT (JETSTREAM OF HOUSTON, INC., TECHNICAL SPECIALTIES, INC., JARVIS ENGINEERING COMPANY, AND COMBINED PLANT SERVICES, INC., DEFENDANTS (GUNDERSEN/VIKING, INC., THIRD-PARTY DEFENDANT-APPELLEE)).



Appeal from the Circuit Court of Cook County. No. 91 L 16005. The Honorable Patrick E. McGann, Judge Presiding.

Released for Publication October 4, 1996. Rehearing Denied Sept. 26, 1996.

The Honorable Justice Cousins delivered the opinion of the court. Gordon and Hourihane, JJ., concur.

The opinion of the court was delivered by: Cousins

JUSTICE COUSINS delivered the opinion of the court:

The appellant and third-party plaintiff, Stolt Terminals (Chicago), Inc. (Stolt), filed a third-party complaint seeking contribution from appellee and third-party defendant, Gundersen/Viking, Inc. (Gundersen). Stolt contracted with Gundersen for it to clean Stolt's storage tanks, and a Gundersen employee died while waterblasting a tank on Stolt's property. Decedent's relatives sued Stolt pursuant to alleged violations of the Structural Work Act (740 ILCS 150/1 (West 1994)). After Stolt sought contribution from Gundersen, Gundersen moved to limit any contribution award to the amount of its workers' compensation liability, the contribution limit for employers imposed by the supreme court in Kotecki v. Cyclops Welding Corp., 146 Ill. 2d 155, 585 N.E.2d 1023, 166 Ill. Dec. 1 (1991). Stolt responded that Gundersen had waived the Kotecki contribution limit in its contract with Stolt, relying on the fifth district case of Herington v. J.S. Alberici Construction Co., 266 Ill. App. 3d 489, 639 N.E.2d 907, 203 Ill. Dec. 348 (1994). However, the trial court held that Herington conflicted with Kotecki and its public policy to protect employers, and the court granted Gundersen the Kotecki limit on its contribution liability.

We reverse and remand.

On October 9, 1990, Gundersen and Stolt entered into a contract where Stolt agreed to pay $3,175 for Gundersen to provide the labor and equipment to waterblast a tank on Stolt's property to remove accumulated rust in the tank's interior. Stolt drafted the contract with the following provisions:

"7. If vendor performs services or constructs, errects [sic], inspects or delivers hereunder, Vendor agrees to indemnify and hold harmless Stolt Terminals (Chicago) Inc. from all loss or the payment of all sums of money by reason of all accidents, injuries, or damages to persons or property that may happen or occur in connection therewith.

8. Vendor represents and warrants that no Federal or State Statute or regulation, or municipal Ordinance, has been or will be violated in the manufacturing, sale, and delivery of any article or service sold and delivered hereunder, and if such violation has or does occur, Vendor shall indemnify and hold harmless Stolt Terminals (Chicago) Inc. from all loss, penalties, or the payment of all sums of money on account of such violation."

On October 17, 1990, Gundersen employee Arthur Farmer died while waterblasting Stolt's tank. Farmer's waterblasting gun sprang a leak, which caused a stream of high-pressure water to hit him in the neck, and Farmer fell from scaffolding erected in the tank.

On October 4, 1991, decedent's mother filed a complaint against Stolt, and decedent's seven brothers and sisters joined as plaintiffs in the fourth amended complaint filed on October 27, 1993. Count IV of that complaint alleged that Stolt had the right to supervise and control the activities of subcontractors, and that it failed to properly supervise and inspect the construction of the tank's scaffolding in violation of the Structural Work Act. The complaint's other counts were directed at defendants who were involved in the manufacture or sale of the waterblasting equipment.

On November 23, 1993, Stolt filed a third-party complaint against Gundersen. Counts I and II sought indemnity for all losses that were the proximate result of wrongful acts or breach of contract by Gundersen. Count III sought contribution to the extent that Gundersen's wrongful acts caused decedent's death.

On December 22, 1993, Gundersen moved to strike the ad damnum clause of count III of Stolt's complaint for its failure to limit Gundersen's contribution liability to Gundersen's workers' compensation liability, as dictated by Kotecki. The trial court granted the motion on September 6, 1994.

On September 16, 1994, Stolt moved for reconsideration of the order, relying on the August 1994 case of Herington. In Herington, the fifth district held that an employer's contractual agreement to indemnify for its own wrongful acts could waive the Kotecki contribution limit. Gundersen responded that (1) Herington was wrongfully decided, (2) paragraphs seven and eight of the contract sought indemnity rather than contribution and, thus, both violated the Construction Contract Indemnification for Negligence Act (Indemnity Act) (740 ILCS 35/1 (West 1994)), and (3) Gundersen could not have waived its Kotecki rights through a 1990 contract because Kotecki was decided in 1991. Gundersen also moved for summary judgment as to all three counts. On February 2, 1995, the trial court agreed with Gundersen's first rationale and denied the motion to reconsider, stating that it was not persuaded by the logic of Herington and felt constrained to follow ...


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