Lancaster Stone Products Corp. v. Austin Powder Co.

Order reversed, on the law, without costs, and motion granted. Memorandum: In two separate actions brought by plaintiff to recover damages caused by the explosion of a truck loaded with dynamite and driven to plaintiff’s property by an employee of defendant Austin Powder Company, plaintiff alleged a cause of action in negligence against Austin and a second cause of action for contractual indemnification. The predicate for the indemnification cause of action is a service agreement entered into between the parties which provides, in pertinent part: "Lancaster Stone Products Corporation recognizes full responsibility for the results and consequences of such service when performed by a licensed blaster using generally accepted loading and safety procedures. The licensed blaster and Austin Powder Company are responsible to the full extent of their [sic] liability for damages that result from the improper use or handling of explosives products. ” (Emphasis supplied.)

Austin moved for partial summary judgment dismissing the second indemnification causes of action in each complaint. Special Term denied the motion finding that the second cause of action "presents a triable issue of fact as to whether and to what extent Austin’s improper use or handling of the explosives may have contributed to Lancaster’s damages”. This was error.

The agreement between the parties is unambiguous. It provides that Lancaster shall assume full responsibility for the consequences of any blasting when the service is provided by a licensed blaster using acceptable procedures. Austin, on the other hand, assumed responsibility "to the full extent of their liability” for damages resulting from the improper use or handling of explosives. This is nothing more than a statement of Austin’s common-law liability. Nothing in the service agreement even remotely implies that Austin agreed to assume responsibility for damages regardless of who was at fault.

While an indemnification agreement entered into at arm’s length between sophisticated parties may be construed as intending indemnification of a party for its own negligence, this result will obtain only if "the agreement between the parties connotes an 'intention to indemnify [which] can clearly be implied from the language and purposes of the entire agreement’. (Margolin v New York Life Ins. Co., 32 NY2d 149, 153)” (Hogeland v Sibley, Lindsay & Curr Co., 42 NY2d 153,159). The instant agreement falls far short of this standard and, indeed, does nothing more than obligate Austin to pay for damages which result from its own negligence, a responsibility which has already been pleaded in the first cause of action in each complaint.

All concur, except Hancock, Jr., J. P., who dissents and votes to affirm in the following memorandum.