Stanley Access v. Home Depot

Case: 21-20493 Document: 00516451432 Page: 1 Date Filed: 08/29/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
August 29, 2022
No. 21-20493
Lyle W. Cayce
Clerk
Ralph Matthews,
Plaintiff,
versus
Home Depot USA, Incorporated,
Defendant—Appellee/Cross-Appellant,
versus
Stanley Access Technologies, L.L.C.,
Defendant—Appellant/Cross-Appellee.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:17-CV-1643
Before Smith, Clement, and Haynes, Circuit Judges.
Per Curiam:*
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-20493 Document: 00516451432 Page: 2 Date Filed: 08/29/2022
No. 21-20493
This case concerns the interpretation under Georgia law of an
indemnity provision in a Maintenance Service Agreement (“MSA”)
between Stanley Access Technologies (“Stanley”) and Home Depot.
Plaintiff Ralph Matthews fell and was injured at a Home Depot in Houston,
Texas, when the store’s automatic doors closed on him and his walker.
Matthews filed suit against Home Depot and Stanley for negligently
maintaining the door.
Pursuant to the indemnity provision in the MSA, Home Depot
demanded Stanley indemnify and defend it in the lawsuit. Stanley refused,
asserting an exception. Home Depot then crossclaimed against Stanley for
breach of contract based on its failure to defend. The district court granted
summary judgment in favor of Home Depot on the breach of contract claim,
and Stanley appealed. We AFFIRM. Home Depot requested appellate
attorneys’ fees, and we REMAND for that purpose only.
I.
This is a diversity case. The district court had jurisdiction over the
underlying lawsuit under 28 U.S.C. § 1332 and supplemental jurisdiction
over the indemnity claim under 28 U.S.C. § 1367. We have appellate
jurisdiction over Stanley’s timely appeal under 28 U.S.C. § 1291. We review
the district court’s grant of summary judgment de novo. St. Paul Fire &
Marine Ins. Co. v. Green Tree Fin. Corp., 249 F.3d 389, 391 (5th Cir. 2001).
Summary judgment is appropriate “if the movant shows that there is no
genuine dispute as to any material fact and the movant is entitled to judgment
as a matter of law.” FED. R. CIV. P. 56(a). Under the MSA, Georgia law
applies to the interpretation of the indemnity provision, which we also review
de novo. See Mid-Continent Cas. Co. v. Chevron Pipe Line Co., 205 F.3d 222,
225–26 (5th Cir. 2000).
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No. 21-20493
II.
The relevant indemnity provision requires Stanley to defend and
indemnify Home Depot from a claim arising from or related to Stanley’s
work. But there is an exception if the claim arose out of Home Depot’s “sole
negligence.” The relevant provision states (with emphasis added):
To the maximum extent allowed by law, [Stanley] . . . shall
indemnify, defend, and hold harmless Home Depot . . . from
and against any and all claims or allegations . . . liabilities and
damages (collectively, “Claims”), including reasonable
attorneys’ fees, court costs and other expenses incurred in
responding to such Claims that [Home Depot] may suffer or
incur arising out of or related to (a) the death or injury to any
person . . . which resulted or is alleged to have resulted from
any acts or omissions of [Stanley] . . . in performing the
Services; except to the extent such portion of any Claim is directly
and solely caused by the negligence or willful misconduct of [Home
Depot].
The obligation to indemnify for damages and the obligation to defend
against third-party suits are separate and distinct duties. See Nationwide Mut.
Fire Ins. Co. v. Somers, 591 S.E.2d 430, 433–34 (Ga. Ct. App. 2003) (per
curiam). In insurance contract indemnity provisions under Georgia law (and
the law of many other states), the scope of an insurer’s duty to defend is
determined by looking to the “eight corners” of the plaintiff’s complaint and
the contract. See, e.g., Penn-Am. Ins. Co. v. Disabled Am. Veterans, Inc., 490
S.E.2d 374, 376 (Ga. 1997). That is, the duty to defend is triggered if the
allegations in the complaint—even if completely meritless—encompass
conduct covered by the relevant indemnity provision. Id.; see also BBL-
McCarthy, LLC v. Baldwin Paving Co., 646 S.E.2d 682, 685 (Ga. Ct. App.
2007).
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The district court held that, in Georgia, insurance-law principles
apply with equal force to non-insurance indemnity provisions like the one at
issue here. Accordingly, because Matthews sued both Stanley and Home
Depot for negligence—rather than pursuing Home Depot as solely
negligent—the sole-negligence exception did not apply to the duty to
defend, 1 and Stanley’s refusal to defend Home Depot was not justified.
Stanley urges that the district court erred in its determination because
Georgia does not apply the insurance-law eight corners rule to non-insurance
contracts. Per Stanley, its duty to defend is only triggered after an
adjudication establishing that Home Depot was not solely negligent. We
disagree.
Georgia courts consistently apply insurance-law principles and the
eight corners rule when analyzing the duty to defend in non-insurance
indemnity provisions. See, e.g., Fayette Cnty. Nursing Home, LLC v. PRI X-
Ray, LLC, 801 S.E.2d 116, 119–20 (Ga. Ct. App. 2017); JNJ Found.
Specialists, Inc. v. D.R. Horton, Inc., 717 S.E.2d 219, 222–23 (Ga. Ct. App.
2011) (physical precedent only). Georgia courts also invoke this “well-
established rule” when interpreting non-insurance sole-negligence clauses
specifically. See Bruce v. Georgia-Pacific, LLC, 757 S.E.2d 192, 197–98 (Ga.
Ct. App. 2014) (holding that, under Georgia law, indemnitor was excused
from its duty to defend where the underlying suit alleged sole negligence
against the indemnitee); see also Georgia-Pacific, LLC v. Hornady Truck Line,
Inc., No. 07-CV-159, 2009 WL 484629, at *4 (N.D. Miss. Feb. 26, 2009)
(same). We see no reason to depart from this consistent practice.
1
Home Depot settled the negligence case with Matthews during the jury trial and
does not seek to recover indemnification of the settlement amount; accordingly, we need
not address that issue.
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Stanley suggests that insurance-law principles cannot apply to non-
insurance indemnity provisions because insurance indemnity provisions are
construed in favor of the insured, while non-insurance indemnity provisions
are construed against the indemnitee. But Georgia courts have recognized as
much and still apply the eight corners rule to non-insurance indemnity
provisions. See BBL-McCarthy, 646 S.E.2d at 687–88. This argument is
accordingly unavailing.
In sum, we agree with the district court’s conclusion that because
Home Depot was not alleged to have been solely negligent, the MSA’s sole-
negligence exception did not apply, and Stanley was required to defend
Home Depot in the underlying litigation. We AFFIRM the judgment and,
per Home Depot’s request, 2 REMAND solely for the purpose of allowing
the district court to make the initial determination and award of appellate
attorneys’ fees to Home Depot.
2
We treat Home Depot’s request for appellate attorneys’ fees made in its appellee
brief as a petition under 5th Circuit Rule 47.8. See ATOM Instrument Corp. v.
Petroleum Analyzer Co., L.P., 969 F.3d 210, 218–19, 218 n.1 (5th Cir. 2020).
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