J.A. Payton v. Kuhn-Murphy, Inc.

McCABE, P. J.

Contrary to the position of defendants, we determine that the subcontract was executed by one of the

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plaintiff joint venturers and an officer of the defendant subcontractor, with knowledge on the part of the subcontractor at that time that there was a joint venture between the signatory and others and with knowledge of the terms and conditions of the prime contract between contractor and the State of California. Thus the subcontract inured to the benefit of all of the joint venturers comprising the prime contractor. With such determination, the indemnification agreement being in general terms and in the absence of active negligence on the part of contractor, the contractor is entitled to indemnification from subcontractor.

J. A. Payton, a copartnership, George Herz & Company, a corporation, and Clyde W. Wood & Sons, Inc., a corporation, jointly submitted a bid and were awarded the prime contract by the State of California to construct a portion of the San Bernardino Freeway. This joint venture will hereinafter be referred to as Contractor. Kuhn-Murphy, Inc. entered into a subcontract with the Contractor for work on the project generally described as “dirt hauling.” Although in dispute, the court found upon substantial evidence that the prime contract had been entered into before the subcontract was executed. J. A. Payton signed the subcontract agreement as Contractor.

The subcontract agreement recited that the subcontractor (Kuhn-Murphy, Inc.) had examined the plans, specifications and the prime contract and knew the contents and requirements of it; subcontractor had examined the work site and subcontractor assumed toward the Contractor all obligations and responsibilities the Contractor, as the Contractor, assumed toward the State of California insofar as applicable to the work to be performed by the subcontractor. By the subcontract, subcontractor agreed to furnish, before commencement of work, evidence of adequate protection by public liability and property damage insurance. Further, subcontractor agreed in the subcontract “to indemnify and save Contractor harmless from any and all claims, damages or liability of whatever nature which might result from performance of ’ ’ the work under the subcontract and “to pay a reasonable attorney’s fee, to be fixed by court, in the event litigation is necessitated for the settlement of any such claims or liens.”