Our case involved a violent assault upon an office worker by a janitor in a metro Atlanta office building. We defended the property manager who had contracted with the janitor’s company to clean the building. The cleaning company was also a defendant in the case, along with the property owner and security company.
Of course, the first request we made to our client was to show us the contract with that cleaning company. And, we found in that contract what we hoped to find – both an indemnity and insurance procurement provision. The cleaning company was to defend and protect our management company from injury to others “arising out” of their work and to insure our client for claims against it arising out of that work.
We next tendered the defense of the case, via letters, to the cleaning company and its insurer. And, for reasons we later proved to be wrong, both denied our tender!
We then filed a cross claim against the cleaning company for breach of contract, indemnity and legal fees/costs. Under GA law, a cross claim like this is authorized to resolve a dispute between defendants since the dispute relates to the main claim involved in the case.
We also filed a third party claim against the insurer of the cleaning company because our client was in fact listed as an additional insured under that liability policy. Under GA law, an insurer can be added to a pending lawsuit by a defendant claiming a right to insurance from that insurer and when that insurer denies coverage.
After two years of litigation, we were able to convince the cleaning company and its insurer that the plaintiff’s injury was something “arising out of” the contract at issue. In GA, the phrase “arising out of” in an indemnification provision does not mean proximate cause in the strict legal sense nor does it require a finding that the injury was directly caused by the indemnitor’s actions. Rather, and as our GA courts have held, almost any causal connection or relationship will do.
But for the cleaning contract, but for the cleaning company hiring that janitor and but for that janitor having access to the building that night for cleaning, this event would not have occurred and our client would not have been sued. At the least, the event and injury arose out of the contract at issue.
After fighting about it (for too long in our opinion), the cleaning company and its insurer finally agreed to: a) reimburse our client management company and its insurer for our legal fees/costs, and b) pay the plaintiff to settle the claims advanced against our client in the lawsuit. The end result was that our client was made whole and dismissed from the case.
The case later tried against the cleaning company and resulted in a multi-million dollar plaintiff’s verdict. The other defendants settled out before trial.
If another is obligated to pay your tab, first ask them to do it and if necessary use the law to convince them.
If you would like to talk further about the strategy involved in this case or about any other legal matter, please feel free to call me.
Matt Moffett – for the defense