United States District Court, E.D. Missouri, Eastern Division
COMMUNICATIONS UNLIMITED CONTRACTING SERVICES, INC., et al., Plaintiffs,
v.
BROADBAND INFRASTRUCTURE CONNECTION, LLC; and MID-CONTINENT CASUALTY COMPANY, Defendants. MID-CONTINENT CASUALTY COMPANY, Counterclaim Plaintiff,
v.
COMMUNICATIONS UNLIMITED CONTRACTING SERVICES, INC., Counterclaim Defendant.
MEMORANDUM AND ORDER
AUDREY
G. FLEISSIG, JUDGE
This
diversity action seeking indemnification and equitable
contribution is before the Court on the motion (ECF No. 48)
of Plaintiff Communications Unlimited Contracting Services
("Communications Unlimited") for partial summary
judgment on Defendant Mid-Continent Casualty Company's
("Mid-Continent") counterclaim for noncontractual
indemnity or contribution from Communications Unlimited for
sums Mid-Continent paid to settle claims made against its
insured, Defendant Broadband Infrastructure Connection, LLC
("Broadband"), in an earlier action. For the
reasons set forth below, the motion will be granted.
BACKGROUND
The
facts relevant to the motion before the Court are as recited
in the Court's Memorandum and Order dated May 10, 2017,
converting Communications Unlimited's motion to dismiss
Mid-Continent's counterclaim to a motion for summary
judgment:
In 2007, a company named Communications Unlimited entered
into a Master Contractor Agreement with Charter
Communications, Inc. ("Charter"), under which
Communications Unlimited agreed to install cable services for
Charter customers in Missouri. In 2012, Communications
Unlimited entered into a Master Service Agreement with
[Broadband], setting forth terms under which Broadband would
perform cable installation work assigned to it by
Communications Unlimited. The Master Service Agreement
contained an "Insurance" provision, requiring
Broadband to obtain Commercial General Liability Insurance,
with coverage for a minimum amount of $1 million per
occurrence, as well as Umbrella Excess Insurance in the same
amount. The Master Service Agreement obligated Broadband to
name Communications Unlimited as an additional insured party
under Broadband's policies. Broadband obtained such
insurance, with Mid-Continent as the insurer.
The Master Service Agreement between Communications Unlimited
and Broadband also contained an "Indemnification"
provision pursuant to which Broadband agreed to indemnify
Communications Unlimited for any claims and liabilities
arising out of, as relevant here, wrongdoing on the part of
any Broadband employee.
Communications Unlimited itself was insured under a
Commercial General Liability Policy issued by Plaintiff
Charter Oak Fire Insurance Company ("Charter Oak"),
and an Umbrella Excess Liability Policy issued by Plaintiff
St. Paul Fire & Marine Insurance Company ("St.
Paul").
On September 23, 2014, Jane Doe filed an action in Missouri
state court for damages against Charter; Broadband;
Communications Unlimited; and James Helderle, a cable
technician. Doe alleged in her first amended petition that
the three corporate defendants were joint employers of
Helderle, in that they each had the right to control hiring,
supervising, and firing him. Doe alleged that Helderle came
into contact with her "through his employment and/or
agency and/or affiliation with" the three corporate
defendants. She alleged that he entered her apartment on
December 2, 2012, to perform technical cable services, and
acted inappropriately. Helderle was fired on December 4,
2012, based on Doe reporting his inappropriate behavior, and
was told the reason for his termination. The next night he
forced his way into Doe's apartment and sexually
assaulted her. Doe asserted claims of negligent hiring,
negligent supervision, and negligent failure to warn against
each of the three corporate defendants, and a battery claim
against Helderle.
Plaintiffs in the present case made a demand upon
Mid-Continent to defend and indemnify Communications
Unlimited in the Doe action, but Mid-Continent denied the
request. Communications Unlimited alleges that on January 20,
2016, the three Plaintiffs in the present case paid a
confidential sum in settlement of Doe's claims against
Communications Unlimited. Communications Unlimited now seeks
indemnification from Broadband (Count I), under the Master
Service Agreement, for the full amount of the Doe settlement
plus expenses and costs incurred in that action; and for the
same amount from Mid-Continent (Count II) for breach of the
Broadband insurance policies naming Communications Unlimited
as an additional insured. Charter Oak and St. Paul seek
equitable contribution against Mid-Continent (Count III).
Mid-Continent filed a counterclaim against Communications
Unlimited in which it stated that (on or about January 3,
2017) Mid-Continent settled Doe's claims against
Broadband, its insured, for a confidential amount.
Mid-Continent further stated that Broadband assigned
Broadband's rights against Communications Unlimited to
Mid-Continent, with respect to the amount paid to settle
Doe's claims against Broadband. Mid-Continent alleged
that Communications Unlimited was the corporate party that
was solely responsible for, and at fault in, hiring and
supervising Helderle, in that Communications Unlimited
"completely dominated all operations of Broadband . . .
including] complete control regarding hiring, training,
supervision, disciple and firing of employees." More
specifically, Mid-Continent alleged that "[i]t was
employees or officers of [Communications Unlimited] who hired
Helderle and were responsible for his training, job
assignment and supervision." Mid-Continent claimed that,
as such, Communications Unlimited was liable to Mid-Continent
for contribution or indemnity for the amount Mid-Continent
paid to settle Doe's claims against Broadband.
ECF No. 44.
On
January 28, 2016, Doe voluntarily dismissed with prejudice
her state court claims against Charter and Communications
Unlimited. On December 22, 2016, Doe filed a notice of her
dismissal with prejudice of the case against Broadband, which
was granted by the court on January 3, 2017. On January 4,
2017, Doe dismissed her claim against Helderle.
In
support of its motion to dismiss, Communications Unlimited
argued that Mid-Continent's counterclaims for
contribution or non-contractual indemnity were barred
pursuant to Mo. Rev. Stat. § 537.060, by virtue of
Communications Unlimited's settlement of Doe's claim
against it. Section 537.060 provides as follows:
When an agreement by release ... is given in good faith to
one of two or more persons liable in tort for the same injury
or wrongful death, such agreement shall not discharge any of
the other tort-feasors for the damage unless the terms of the
agreement so provide; however such agreement shall reduce the
claim by the stipulated amount of the agreement, or in the
amount of consideration paid, whichever is greater. The
agreement shall discharge the tort-feasor to whom it is given
from all liability for contribution or noncontractual
indemnity to any other tort-feasor. The term
"noncontractual indemnity" as used in this section
refers to indemnity between joint tort-feasors culpably
...