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Contracts Keyed to Jimenez
Pacific Gas & Electric Co. v. G.W. Thomas Drayage & Rigging Co.
Facts
In 1960, G.W. Thomas Drayage and Rigging Co. (Thomas) (defendant) went into an agreement with Pacific Gas and Electric Co. (PG&E) to give work and equipment important to remove and replace the upper cover for PG&E’s steam turbine. Thomas consented to play out the work at its own risk and expense and to repay PG&E for any “loss, damage, expense and liability resulting from injury to property” or any other demonstration related to the execution of the agreement. During execution, the cover fell and damages some portion of the exposed rotor of PG&E’s turbine. PG&E sued to recover $25,144.51 in damages. The trial court granted judgment for PG&E because Thomas’ indemnity provision shielded PG&E from damage to its own property. The trial court concluded that the “plain meaning” of the indemnity provision in Thomas’ agreement was to allow indemnification of damage to PG&E’s property notwithstanding the property of third parties. The trial court admitted no extraneous proof on this issue. Thomas appealed, contending that that extraneous proof ought to be allowable to demonstrate that the “plain meaning” of the indemnity clause was that it should just apply to damage to the property of third parties, not PG&E.
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ProfessorMelissa A. Hale
CaseCast™ – "What you need to know"
6m 23s