Security Fire Protection Co. v. City of Ripley

SUMMERS, Judge. On May 26,1976, Security Fire Protection Company, Inc., the third party plaintiff-appellant, was installing a sprinkler system on the premises of Master Trouser Corporation when it ruptured a city water line. On May 23, 1978, Master Trouser sued the appellant for the damages to its premises caused by the ruptured water line. The appellant answered the complaint on June 19, 1978, and also filed a third party complaint against the City of Ripley, the third party defendant-appellee in this suit. The appellant alleged that the negligence of the employees of the appellee was the direct and proximate cause of any loss or damage suffered by Master Trouser and sought contribution or indemnity from the appellee for any damages it might have to pay to Master Trouser. The appellee made a motion for a summary judgment on April 9, 1979, and the trial judge sustained the motion on July 2, 1979. In that same order, the appellant excepted and prayed for a discretionary appeal which was denied by the trial court. Thereafter, the appellant settled with Master Trouser and paid that company the sum of $7,500.00. The judgment entered on October 16, 1979, also dismissed the original complaint and the third party complaint with full prejudice. The appellant appealed to this court and presented two issues, and the appellee then raised five issues. The appellee alleged that the judgment signed by the trial judge and entered on October 16, 1979, was a consent judgment; therefore, the appellant, as a party to the consent judgment, voluntarily dismissed its third party complaint against the appellee and has no legal basis to appeal the case. In examining the judgment, we find it states: “that all matters in controversy between plaintiff and defendant have been settled by consent,” the plaintiff and defendant being Master Trouser and the appellant herein. It does not appear in the judgment that the appellant consented to the dismissal of its third party complaint filed against the appellee. In fact, in the order granting the summary judgment to the appellee, it is clearly stated that the appellant excepted to the ruling of the court. We hold that this appeal is properly before this court for our consideration and respectfully overrule the first issue presented by the appellee. [876] The remaining issues will not be discussed seriatim. These issues concern whether the appellee was immune from suit under the Governmental Tort Liability Act for the alleged acts of negligence of its employees; whether the appellant is barred from recovery under its third party complaint for contribution because of the appel-lee’s immunity from suit by Master Trouser; and whether a suit for contribution may be instituted against the appellee more than twelve months after the initial cause of action arose. Chapter 33 of Tennessee Code Annotated is the Governmental Tort Liability Act. T.C.A. § 23-3311 provides for the removal of immunity for injury caused by the negligent act or omission of employees of the governmental entity and exceptions thereto. Further, sections of the act provide the time for filing notice of the claim, and, if the claim is denied, suit must be filed in the circuit court within twelve months after the cause of action arises. Therefore, Master Trouser lost any claims it had against the appellee because it did not file within the time prescribed by the statute. T.C.A. § 23-3322 provides: The court, before holding a governmental entity liable for damages, must first determine that the employee or employees [sic] act or acts were negligent and the proximate cause of plaintiff’s injury, that the employee or employees acted within the scope of his or their employment and that none of the exceptions listed in § 23-3311 are applicable to the facts before the court.... In the case before us, a summary judgment was granted to the appellee, and the learned trial judge, therefore, made no determination as set out in T.C.A. § 23-3322. This the court will have to do at the trial of the case upon its remand to the lower court. The appellee relies on the case of Vaughn v. Gill, 264 S.W.2d 805 (Tenn.1953), for the proposition that if the statute of limitations has run on the injured party’s claim against the party from whom contribution is sought prior to the time that an action for contribution is filed, this would preclude any common liability existing between the tort-fea-sors and would preclude an action for contribution. In City of Kingsport, Tennessee v. SCM Corporation, 429 F.Supp. 96 (E.D.Tenn.1976) is the following: ... In Vaughn v. Gill (1953), Tenn., 264 S.W.2d 805, 808[5], it was held that there was no common liability where the plaintiff’s claim against the co-obligor against whom contribution was sought was barred by the statute of limitations and thus contribution was not available. This opinion was withdrawn from the official Tennessee Reports by the Tennessee Supreme Court. As to its precedential value herein, “* * * [it] is merely the opinion of the judge who filed it and is binding upon only the parties to that particular litigation. ***”... It is thus clear that the moving defendants-by-counterclaim are not entitled to a summary judgment on their contention that, since Kingsport’s action against them would have been barred by the statute of limitations, then SCM’s claim for contribution or indemnification would likewise be barred. Therefore, we cannot rely on Vaughn, supra. We find City of Kingsport, Tennessee, supra, to be dispositive of the case at bar. The City of Kingsport sued SCM Corporation and Special Coatings, Inc., for damages from a defective roof which had been placed on a high school building. SCM pled the statute of limitations as the defense and then filed a counterclaim for contribution and indemnity against Steel and Roof Structure, Inc., Bristol Pre-Stressed Concrete Corporation and J. Larry Poole and William Hamilton Wallace, alleging that they performed their duties negligently and that they should share any responsibility for any loss caused by defects in the roof. Suit was brought on December 15,1970, and the proof showed that the City of Kingsport had occupied the building since September, 1967. The Court ruled that the three year statute of limitations under T.C.A. § 28-305 was applicable. After several days of testimony at the trial, the plaintiff and the [877] defendants reached a settlement, and SCM agreed to pay the plaintiff $300,000.00, the full amount of damages sought. The defendants by counterclaim made a motion to dismiss or for a summary judgment, which the court granted. The Court based its decision on the fact that since SCM and Coatings had pled in their answers to the original complaint that such action was barred by the statute of limitations, they were estopped to deny that their original claim was so barred and thus no common liability for contribution or indemnity would lie. SCM appealed to the Court of Appeals for the Sixth Circuit, and that court reversed the summary judgment and remanded the matter back to the district court. The defendants by counterclaim argued that as the City of Kingsport’s claim against SCM was barred by the three year statute of limitations and SCM settled with the city on a voluntary basis and not under legal obligation, SCM was not entitled to contribution or indemnity as a matter of law. However, there was a factual issue presented as to whether SCM has induced the city to delay bringing suit so that SCM waived or was estopped from asserting the statute of limitations as a defense herein. The court found that the statute of limitations and forbearance were issues for the jury to determine. As to whether a defendant could claim the right of contribution or indemnity against a joint tort-feasor although the statute of limitations had run against the plaintiff suing the other joint tort-feasors, the court in City of Kingsport, Tennessee, supra discussed the matter, and we quote several parts of that case: It should be noted initially that, for the purposes of these motions, it makes no difference whether SCM’s theory is based upon contribution or indemnity. “* * * [Indemnity under the active-passive negligence theory is more ‘akin to contribution between tort-feasors, and should be governed in this regard by the principles applied to contribution.’ “ * * * The general rule seems to be that where the original defendant alleges facts showing that the additional defendant is liable over to him, joinder is generally held to be proper, and the fact that the statute of limitations will bar the plaintiff from a direct recovery against the additional defendant has no effect on the defendant’s right to enforce his claim of contribution or indemnity, since the cause of action owed by the plaintiff is distinct from the cause of action arising out of the duty of the additional defendant to indemnify the defendant. * * *” Anno: 8 A.L.R. (2d) 6, 139, & 70. According to the American Law Institute, where C bring an action against B for damages and B in turn seeks indemnification from A, even if “* * * C does not bring suit until the [s]tatute of [limitations has run in favor of A although not in favor of B * * * B is entitled to indemnity from A. * * *” Restatement of the Law, Restitution (1st) § 86, illustration 3 to comments. “* * * [T]he rule supported by most of the authorities is that an obligor who has been compelled to pay more than his proportion of the common obligation may compel his co-ob-ligor to contribute the amount he ought to have paid, although an action against the latter by the obligee would have been barred if instituted at the time of the payment by the claimant, as, for example, where the statute [of limitations] has run against his co-obligor. * * *” 18 Am. Jur. (2d) 29-30, Contribution § 14. The aforementioned legal rules are entirely consistent with the nearly-universal view that the statute of limitations for an action for indemnity or contribution does not commence to run until there has been a payment made or some loss suffered by a party seeking such indemnification or contribution.... As our Supreme Court has held in Butler v. Trentham, 224 Tenn. 528, 458 S.W.2d 13 (1970), a suit for contribution is, whether in equity or at law, not ex delicto in nature. Therefore, we conclude that the one year statute of limitations for tort [878] claims against governmental entities as provided for in the Governmental Tort Liability Act is not applicable to this case. Chapter 31 of T.C.A. is entitled “Contribution Among Tort-Feasors”. Section 23-3102 provides: ... a. Except as otherwise provided in this chapter where two (2) or more persons are jointly or severally liable in tort for the same injury to persons or property or for the same wrongful death, there is a right of contribution among them even though judgment has not been recovered against all or any of them; but no right of contribution shall exist where, by virtue of intrafamily immunity, immunity under the workmen’s compensation laws of the State of Tennessee, or like immunity, a claimant is barred from maintaining a tort action for injury or wrongful death against the party from whom contribution is sought. We must agree with the appellee’s interpretation of this statute as set forth in its brief. The exceptions to the right of contribution noted in the section are intrafamily immunity, immunity under the workmen’s compensation laws of the State of Tennessee or like immunity. These immunities listed are blanket immunities; at no time can an action be brought due to this type of immunity. However, in the case before us, the appel-lee was not immune from suit. It could have been sued by Master Trouser within a year after the damages to Master Trouser’s property had the proper notice of 120 days been given and the statutory requirements met. But this is not a tort action so we are not concerned with the 120 days notice. There is a vast difference between the blanket immunities listed in T.C.A. § 23-3102 and the defense of the one year statute of limitations. Since the appellee could at one time have been sued by Master Trouser, it can now be sued for contribution by the appellant if the suit for contribution is brought within one (1) year after satisfaction of judgment. (T.C.A. § 23-3104) We remand the case back to the trial court to make the determinations enumerated by T.C.A. § 23-3322. If such determinations are made in favor of the appellant, then the court should proceed to a trial on the merits as to the question of contribution by the appellee. The costs in this cause are adjudged against the appellee. MATHERNE, J., concurs. NEARN, J., dissents. JUDGMENT SUMMERS, Judge. This matter came on to be regularly considered on the record. For the reasons set forth in our opinion of even date, it is ordered: 1. That the judgment of the trial court dismissing the cross claim of the appellant against the appellee is reversed, and this cause is remanded back to the trial court for it to make determinations as set out in T.C.A. § 23-3322, and if such determinations are made in favor of the appellant, then for a trial on the merits as to the question of contribution by the appellee. 2. That thd costs of this appeal are assessed against the appellee.