Published on:

No Indemnification for Wal-Mart Absent Determination of Cause of Leak that Led to Personal Injuries

In a recent decision, the United States District Court, District of Nevada, examined whether a roofing contractor who performed work at a Wal-Mart was required to indemnify Wal-Mart for damages for which it may be liable relative to a woman’s slip and fall in the store.

In Goben v. Wal-Mart Stores, Inc., the plaintiff, Beverly Goben, suffered personal injuries when she slipped and fell on water inside a Wal-Mart store. Goben sued Wal-Mart for negligence. Wal-Mart, in turn, sued North American Roofing (NAR), a contractor that had performed work on the store’s roof. Wal-Mart alleged that NAR’s faulty work created a leak in the roof that led to Goben’s slip-and-fall incident.

According to the contract between Wal-Mart and NAR, NAR was to indemnify Wal-Mart against all claims and liabilities arising out of or related to “the acts, omissions, negligence, or willful misconduct of [NAR]” in connection with the services NAR was to provide Wal-Mart. Wal-Mart requested that the district court enter summary judgment in its favor, finding that NAR was obliged to indemnify Wal-Mart against Goben’s claims.

Wal-Mart argued that the indemnification clause was triggered because Goben’s complaint described personal injury that arose from NAR’s negligence. However, NAR argued that the plain language of the indemnification clause required that there be some showing that NAR’s acts led to the lawsuit; thus, a mere allegation that NAR was at fault was insufficient to trigger indemnification.

The district court agreed with NAR. Additionally, although Wal-Mart focused on the argument that NAR failed to perform work on an expansion joint (as was required under the parties’ contract), and on Wal-Mart’s expert’s conclusion that the leak that caused Goben’s fall came from the expansion joint. Again, however, NAR’s duty to indemnify Wal-Mart arises under the contract only when the cause of the leak has in fact been determined. Because there was a dispute as to the cause of the leak, the court concluded that “it is not clear whether the lawsuit is the result of actions, omissions, negligence or willful misconduct of NAR.” Accordingly, the court denied Wal-Mart’s motion for summary judgment, pending a factual finding as to the leak’s cause.