Monday, October 11, 2010

Luzerne County Judge Joseph Van Jura Addresses Duty to Defend/Indemnify

In the case of Thyssenkrupp Elevator Corporation v. Humford Equities, No. 18390-Civil-2009 (Luz. Co. August 17, 2010 Van Jura, J.), Judge Joseph Van Jura granted summary judgment in a declaratory judgment action on the issue of a duty to defend and denied summary judgment on the issue of a duty to indemnify.

By way of background, Defendant, Humford Equities, had contacted with the Plaintiff, Thyssenkrupp Elevator Corporation, for the maintenance of three elevators located in the Wilkes-Barre Center.

While the elevator maintenance agreement was in effect, two separate personal injury actions were filed by different injured parties against Thyssenkrupp, as well as Humford, and other entities, alleging that Thyssenkrupp, failed to properly maintain one of the elevators at the Wilkes-Barre Center, allegedly resulting in personal injuries to the injured parties.

Thereafter, Thyssenkrupp filed this action for declaratory judgment alleging a breach of contact on the part of Humford Equity for failure to provide a defense and indemnity to Thyssenkrupp in the underlying personal injury actions.

In his Opinion, Judge Van Jura set forth the analysis applicable to reviewing duty to defend/duty to indemnify language. Applying the law to the contract language the Court found that the duty to defend provisions contained in the elevator maintenance agreement was sufficiently specific to evidence a clear intent of the parties. Accordingly, the Court found that Humford Equity was legally bound to defend Thyssenkrupp in the underlying lawsuits.

The court also held that, under the duty to defend language contained in the agreement, that duty was triggered by the filing of the lawsuits and Thyssenkrupp did not have to await for the resolution of the underlying lawsuits. In other words, Humford Equity’s position that Thyssenkrupp was intended, under the agreement, to have a post-litigation remedy by means of a legal action to recoup Thyssenkrupp’s self-expended defense costs was rejected.

The remaining portion of the Motion for Summary Judgment dealing with the duty to indemnify was denied as premature.

Anyone desiring a copy of this opinion may contact me at dancummins@comcast.net.

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