Facility Owner’s Demand for Insurance Coverage from Common Carrier To Defend Case Against Carrier’s Injured Employee Allowed To Proceed
In an underlying suit, a worker alleged negligence against the owner of a facility to which he was making a delivery when he was injured. In turn, the facility owner sued the worker’s employer, a common carrier, asserting that the carrier had breached its duty to defend and indemnify under a Contract Carriage Agreement.
The U.S. District Court for the Western District of Kentucky denied the common carrier’s request for summary judgment. First, the court found that as a subsidiary to the signatory of the Contract Carriage Agreement, the facility owner was an intended beneficiary of the agreement and had standing to sue despite not being an actual signatory. Second, although the contract included exculpatory language that would waive the common carrier’s duty to defend and indemnify for injuries due solely to another party’s negligence, disputed issues of material fact precluded the court from determining whether the exculpatory language applied at this stage. Lastly, the court explained that it did not have sufficient evidence to determine whether the contract was a contract of adhesion and, therefore, unenforceable.
