The opinion of the court was delivered by: Frazier, Magistrate Judge:
Before the Court are third party plaintiff Kroger Co.'s motion for summary judgment (Doc. 166) and the third party defendants' motion for summary judgment (Doc. 170). For the following reasons, third party plaintiff Kroger Co.'s motion for summary judgment (Doc. 166) is GRANTED and the third party defendants' motion for summary judgment (Doc. 170) is GRANTED in part and DENIED in part.
This action arises out of a June 3, 2006 incident in Carbondale, Illinois when Doris Cole allegedly exited a Kroger Grocery Store located in the West Park Plaza strip mall carrying bags of groceries, and subsequently stepped on a slick, sloping, uneven area, and fell. She claimed that the area was painted with a yellow "slippery paint." This area was painted in September, 2005, approximately 9 months prior to the alleged incident. Cole alleged, generally, that Kroger and Bromont Property Management, LLC ("Bromont") owned, operated, and controlled or had a duty to own, operate, and control the property where the accident occurred. She further alleged that Kroger's and Bromont's breach of duty proximately caused her to sustain injuries.
Plaintiff Cole's claim was ultimately settled on March 15, 2011 for a total payment of $30,000. Doc. 172 at 5 ¶ 28; Doc. 176 at 3 ¶ 28. Of the total payment to Cole, Kroger contributed $5,000, and the insurer for the remaining defendants contributed the remainder. See id. As a result of the settlement, Cole's claim against was dismissed with prejudice. Doc. 165. However, Kroger's third-party claim against four named third party defendants remained. Id.
In its amended third party complaint (Doc. 93), Kroger alleges that if it is found liable to Cole for the accident, Kroger is nonetheless entitled to contractual indemnification by BP Carbondale, LLC. ("BP Carbondale"), among others, for any damages Cole is awarded. Doc. 93 at 3 (Count I). Further, Kroger alleges that it is entitled to contribution from BP Carbondale, among others, under a common law theory of premises liability. Id. (Count II). One third-party defendant, the Phillip M. Kimmel Trust ("the Kimmel Trust"), has been voluntarily dismissed from the third party action. See Doc. 127.
The third party plaintiff and defendants have now filed cross-motions for summary judgment (Docs. 166, 170) on the remaining indemnity claim (Count I). Summary judgment is appropriate where "the movant shows that there is no genuine dispute as to any material fact and that the movant is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Spath v. Hayes Wheels Int'l-Ind., Inc., 211 F.3d 392, 396 (7th Cir. 2000). Because jurisdiction is based on diversity (28 U.S.C. ¶ 1332) and the relevant facts of this case occurred in Illinois, substantive Illinois law applies to the instant third party claim for indemnification. See Erie R. Co. v. Tompkins, 304 U.S. 64, 78 (1938).
"An indemnity agreement is an agreement whereby the indemnitor agrees to protect the indemnitee from claims asserted against the indemnitee by third persons." Magnus v. Lutheran General Health Care System, 601 N.E.2d 907, 915 (Ill. App. Ct., 1st Dist. 1992). In Illinois, "an indemnity agreement is a contract and is subject to contract interpretation rules." Virginia Sur. Co., Inc. v. Northern Ins. Company of New York, 866 N.E.2d 149, 153 (Ill. 2007) (citation omitted). "The cardinal rule is to give effect to the parties' intent, which is to be discerned from the contract language", and "if the contract language is unambiguous, it should be given its plain and ordinary meaning." Id. (citation omitted). "Finally, indemnity agreements are not favored in Illinois and thus are strictly construed against the indemnitee." Church v. General Motors Corp., 74 F.3d 795, 799 (7th Cir. 1996) (citations omitted).
In its cross-motion for summary judgment (Doc. 166) against the third party defendants in this case, Kroger relies strictly on the terms of the lease for its argument that at least one of the third party defendants were required to indemnify them for Plaintiff Cole's injuries in this case. The parties agree that at the time of the incident involving Cole, Kroger was leasing the property on which its store was located from third party defendant BP Carbondale, which accepted assignment of the ground lease in 2004 subject its prior terms, provisions, and conditions. Doc. 168 at 2 ¶ 4, 5; Doc. 177 at 2 ¶ 4, 5. Because the evidence demonstrates that BP Carbondale is the landlord under the lease and any duty to indemnify Kroger would be assigned to BP Carbondale only, there can be no existing claim for indemnification against third party defendants Bromont Developments, LLC, Bromont Development Group, LLC, and Bromont Investments, Inc. Therefore, the third party defendants' cross-motion for summary judgment (Doc. 170) will be GRANTED with respect to those four defendants on Kroger's indemnity claim (Count I).
In its cross-motion for summary judgment (Doc. 170), BP Carbondale argues that the lease did not contain clear and unequivocal language requiring BP Carbondale to indemnify Kroger for Kroger's own negligence, as required by Illinois law. This argument is misplaced because there was no finding of negligence with regard to Kroger in this case. It is true that Illinois law requires that an indemnity contract will not be construed as indemnifying one against his own negligence, unless such a construction is required by the clear and explicit language of the contract or such intention is expressed in unequivocal terms. Buenz v. Frontline Transp. Co., 822 N.E.2d 525, 533 (Ill. 2008) (citing Westinghouse Electric Elevator Co. v. LaSalle Monroe Building Corp., 70 N.E.2d 604 (Ill. 1946)). Here, however, Cole's negligence claim against Kroger was settled out of court and voluntarily dismissed. See Doc. 165.
Furthermore, it would be improper for the Court to infer negligence on behalf of Kroger based only upon the fact that Cole chose to make Kroger, the tenant, rather than BP Carbondale, the landlord, a defendant in her negligence case and the fact that Kroger chose to protect its interests by settling the negligence claim instead of incurring further legal expense by defending the claim through trial. The Court cannot now determine, after the claim has been settled out of court, that Kroger was negligent. To do so would violate policy principles encouraging settlement negotiations. See FED. R. EVID. 408; see also Zurich American Ins. Co. v. Watts Industries, Inc., 417 F.3d 682, 689 (7th 2005) (providing that the primary policy reason for excluding settlement communications is that the law favors out-of-court settlements, and allowing offers of compromise to be used as admissions of liability might chill voluntary efforts at dispute resolution and citing as example Perzinski v. Chevron Chem. Co., 503 F.2d 654, 658 (7th Cir. 1974)). For purposes of Kroger's indemnification claim against BP Carbondale, the issue is whether the terms of the lease actually required indemnification.
"Under Illinois law, . the starting point of any contract analysis is the language of the contract itself. If the language unambiguously answers the question at issue, the inquiry is over." Church, 74 F.3d at 799 (citations omitted). The relevant portions of the lease in this case provide as follows:
". All that portion ... not covered by buildings is to be common area for joint use of all tenants, customers, invitees and employees. . Landlord agrees, at its own expense, to maintain all Common Area in good repair, to keep such area clean, to remove snow and ice therefrom, to keep such area lighted during hours of darkness when the demised premises are open for business and to keep the parking area properly striped to assist in the orderly parking of cars. Any claim for damage to property and any claim arising from or out of the injury or death of any person while on the Common Area shall be the responsibility of ...