E-Filed Document Nov 16 2016 11:35:26 2016-CA-01282 Pages: 19 IN THE SUPREME COURT OF THE STATE OF MISSISSIPPI NO. 2016-CA-01282 PREMIER ENTERTAINMENT BILOXI LLC d/b/a HARD ROCK HOTEL & CASINO APPELLANT VS. P.T.E. SYSTEMS INTERNATIONAL, LLC APPELLEE APPEAL FROM THE CIRCUIT COURT OF HARRISON COUNTY, MISSISSIPPI BRIEF OF APPELLANT PREMIER ENTERTAINMENT BILOXI LLC D/B/A HARD ROCK HOTEL & CASINO Michael W. Ulmer MSB #5760 James J. Crongeyer, Jr. MSB #10536 WATKINS & EAGER PLLC Post Office Box 650 Jackson, MS 39205 Telephone: 601-965-1900 mulmer@watkinseager.com jcrongeyer@watkinseager.com Attorneys for Appellant
IN THE SUPREME COURT OF THE STATE OF MISSISSIPPI NO. 2016-CA-01282 PREMIER ENTERTAINMENT BILOXI LLC d/b/a HARD ROCK HOTEL & CASINO APPELLANT VS. P.T.E. SYSTEMS INTERNATIONAL, LLC APPELLEE CERTIFICATE OF INTERESTED PERSONS The undersigned counsel of record for Appellant certifies that the following listed persons have an interest in the outcome of this case. These representations are made in order that the Justices of the Supreme Court and/or the Judges of the Court of Appeals may evaluate possible disqualifications or recusals. 1. Premier Entertainment Biloxi LLC d/b/a Hard Rock Hotel & Casino, Appellant; 2. Michael W. Ulmer, James J. Crongeyer, Jr. and the law firm of Watkins & Eager PLLC, lawyers for Appellant; 3. Thomas L. Carpenter and the law firm of Carr Allison, lawyer for Appellee; 4. P.T.E. Systems International, LLC, Appellee; 5. William R. Purdy, Ralph B. Germany, Jr., Slates C. Veazey and the law firm of Bradley Arant Boult Cummings LLP, lawyers for Roy Anderson Corp.; 6. Roy Anderson Corp., a Tutor Perini Company; and 7. Honorable Roger T. Clark, Circuit Judge of Harrison County, Mississippi. So certified, this the 16 th day of November, 2016. /s/ James J. Crongeyer, Jr. James J. Crongeyer, Jr. MSB #10536 Attorney for Appellant i
TABLE OF CONTENTS Certificate of Interested Persons... i Table of Contents... ii Table of Authorities... iii Statement of the Issues... 1 Statement of Assignment... 1 Statement of the Case... 1 Summary of the Argument... 5 Argument... 6 Conclusion... 13 Certificate of Service... 15 ii
TABLE OF AUTHORITIES Cases Bush v. City of Laurel, 215 So. 2d 256 (Miss. 1968)... 6, 10, 14 Celotex Corp. v. Becknell Constr., Inc., 325 So. 2d 566 (Miss. 1976)... 9, 10, 13 Harris v. Miss. Valley State Univ., 873 So. 2d 970 (Miss.2004)... 2, 6 Home Ins. Co. of NY v. Atlas Tank Mfg. Co., 230 So. 2d 549 (Miss. 1970)... 5, 8, 13 J.B. Hunt Transp., Inc. v. Forrest General Hosp. 34 So. 3d 1171 (Miss. 2010)... 5, 8, 13 Lowe v. Lowndes County Building Inspection Dept., 760 So. 2d 711 (Miss. 2000)... 7 Magnolia Constr. Co., Inc. v. Miss. Gulf S. Engineers, Inc., 518 So. 2d 1194 (Miss. 1988) 13 Overstreet v. Merlos, 570 So. 2d 1196 (Miss. 1990)... 7 Penn. Nat'l Gaming, Inc. v. Ratliff, 954 So. 2d 427 (Miss. 2007)... 2, 6 Richardson v. Clayton & Lambert Manufacturing Co., 634 F. Supp. 1480 (N.D. Miss. 1986)... 13 Rules M.R.C.P 14... 1, 4, 5, 6, 7, 8, 10, 12, 13, 14 Statutes Miss. Code 11-7-17... 13 iii
STATEMENT OF ISSUES Whether the Circuit Court erred in granting Third Party Defendant P.T.E. Systems International, LLC s Motion to Dismiss (the Third Party Complaint of Hard Rock), dismissing Third Party Defendant PTE from this case. STATEMENT OF ASSIGNMENT Appellant does not submit this case should or must be retained the Supreme Court as the issue before the Court is controlled by MRCP 14 and well-settled case law. STATEMENT OF THE CASE I. Course of Proceedings and Disposition in the Trial Court. On November 23, 2015, plaintiff Roy Anderson Corp. (hereinafter Roy Anderson ) 1 sued Defendant/Appellant Premier Entertainment Biloxi LLC d/b/a Hard Rock Hotel & Casino (hereinafter Hard Rock ) for breach of contract related, in part, to the failure of eighteen (18) or more post-tensioned cables and associated materials supplied and sold by Appellee P.T.E. Systems International, LLC (hereinafter PTE ). The PTE cables were selected and utilized by Roy Anderson during its 2013 construction of the New North Hotel Guest Tower Addition at the Hard Rock Hotel & Casino, (hereinafter subject project ). 2 Roy Anderson seeks from Hard Rock reimbursement of all costs associated with the failures of the PTE cables because Hard Rock was required, as Owner, to either (A) obtain all risk builder s risk insurance or (B) be liable to RAC [Roy Anderson] for any loss not compensated by such insurance. [R. 10-133 Complaint, 26 and 52]. 1 Roy Anderson Corp. is now part of Tutor Perini Corporation. 2 Post-tensioned cables are used to improve structural capacity of concrete. They generally are laid out (in sheaths) within concrete. The high-strength tendons are tensioned and it improves the performance of concrete. See generally https://en.wikipedia.org/wiki/prestressed_concrete. 1
Hard Rock denied it was legally responsible for the failure of the PTE cables but admitted it was contractually required to obtain the insurance and, in fact, purchased the required insurance. [R. 134-148, Answer, 26 and 52]. Nonetheless, Hard Rock obtained leave of Court to file its Third Party Complaint against PTE and did so stating claims against PTE associated with the cable failures for common law indemnity, breach of warranty of merchantability, breach of implied warranty of fitness, products liability (manufacturing defect), and breach of express warranty. [R.E. 212-236, Third Party Complaint]. PTE filed a motion to dismiss Hard Rock s Third Party Complaint and argument was had by the Circuit Court on July 28, 2016. The Circuit Court then granted PTE s motion to dismiss and entered a Rule 54(b) Final Judgment of dismissal in its favor. [R.E. 421-427]. Hard Rock submits the Circuit Court erred in granting PTE s motion to dismiss and now appeals. [R.E. 421-427]. II. Statement of Facts. Because of the motion to dismiss standard, and for purposes of consideration of this appeal, these facts must be accepted as true 3 : A. Hard Rock, the owner, and Roy Anderson, the general contractor, entered into a contract for Roy Anderson to build the subject project [R. 10-133, Complaint]; B. As part of the construction contract between Roy Anderson and Hard Rock, construction materials selected and specified by Roy Anderson were purchased directly by Hard Rock for use by Roy Anderson and its 3 These underlying facts generally are alleged in Hard Rock s Third Party Complaint. When considering a motion to dismiss, the allegations in the complaint must be taken as true. Penn. Nat'l Gaming, Inc. v. Ratliff, 954 So. 2d 427, 430 (Miss. 2007) (citing Harris v. Miss. Valley State Univ., 873 So. 2d 970, 988 (Miss.2004)). 2
subcontractors in the construction of the subject project. [R.E. 212-236, Third Party Complaint, 7]. The materials were purchased under an owner direct purchase program which exempted them from the 3.5% contractor s tax with financing for the materials provided by Mississippi Development Finance Corporation Industrial Development Revenue Bonds 4 ; C. The construction materials purchased directly by Hard Rock, including the subject PTE cables, were selected by Roy Anderson and its subcontractors (not Hard Rock) and then utilized and installed by Roy Anderson and its subcontractors (not Hard Rock) during the construction of the subject project [R.E. 212-236, Third Party Complaint, 7]; D. During the construction of the subject project in 2013, at least eighteen (18) of the PTE cables failed below the rated and specified strength for the cables. The PTE 270 KSI post-tensioned ½ diameter cables (including their factory installed heads) were rated for and supposed to withstand up to 80% of 270,000 pounds per square inch of load when stretched or elongated. This equates to 41,310 pounds for breaking strength or 33,000 pounds design load (pure load). [R.E. 212-236, Third Party Complaint, 8-9]; E. The PTE post-tensioned cables failed during or after stressing at loads at or below 80% (33,000 pounds) of the 41,300 breaking strength. Post-tensioned cables do not often fail and the rate and number of failures on the subject project were exceptional. Regardless, they failed below the rated and specified loads for the 270KSI cables. [R.E. 212-236, Third Party Complaint, 8-9]; F. In late 2015, Roy Anderson filed its action against Hard Rock alleging, among 4 This type of exemption arrangement is customary in the industry especially when the project involved will result in significant economic impact. 3
other things, that Hard Rock is contractually responsible for the costs associated with the cable breaks because it was required, as Owner, to either (A) obtain all risk builder s risk insurance or (B) be liable to RAC [Roy Anderson] for any loss not compensated by such insurance. Roy Anderson alleged in its Complaint at least $1,629,977.00 in damages associated with the PTE cable failures. [R. 10-133 Complaint, 19-30 and 51-58]; G. Hard Rock responded and admitted it was contractually required to obtain the insurance and, in fact, purchased the required insurance 5, and also filed a counterclaim against Roy Anderson since it, as general contractor, is contractually responsible for all workmanship and materials associated with the construction of the subject project. [R. 134-148, Answer and Defenses and Counterclaim]; H. Nonetheless, pursuant to MRCP 14, Hard Rock obtained leave to file [R. 211] and did file its Third Party Complaint against PTE, as the manufacturer and supplier of the cables which failed below their specified and rated strength, and which are a subject of Roy Anderson s damages claims against Hard Rock. Therein, Hard Rock stated claims for common law indemnity, breach of warranty of merchantability, breach of warranty of fitness, products liability (manufacturing defect) and breach of express warranty as to the cables which failed. [R.E. 212-236, Third Party Complaint]; I. PTE filed a motion to dismiss [R. 237-390, Motion; R. 391-397, 5 Hard Rock denies there was any breach of contract since it purchased the required insurance and that Roy Anderson was contractually responsible for all workmanship and materials. [R. 134-148, Answer and Defenses and Counterclaim]. Therefore, there was simply no breach of contract by Hard Rock. However, Roy Anderson s claim remains pending with the insurer and the claim may be denied in total, denied in part or it may be argued multiple significant deductibles apply. 4
Memorandum Brief] and argued Hard Rock cannot assert its claims against PTE via a Rule 14 Third Party Complaint under these facts and circumstances; Hard Rock responded and opposed the motion to dismiss of PTE [R. 398-406] and PTE replied [R. 407-417]; and J. The Circuit Court granted the motion to dismiss [R.E. 421-425, Order] following a hearing [R. Vol. IV, Hearing Transcript], and entered a Rule 54(b) Final Judgment in favor of PTE. [R.E. 426-427]. SUMMARY OF THE ARGUMENT PTE s Rule 12(b)(6) motion to dismiss should have been denied. Hard Rock s claims are properly brought pursuant to both Rule 14 and well-established case law and should not have been dismissed. As the Court knows, the standard is very high on a motion to dismiss and all of the allegations of Hard Rock s Third Party Complaint must be accepted as true. Hard Rock s common law indemnity and also its warranty claims (which were not addressed by the Court in its Order) are proper under Rule 14. Additionally, Hard Rock stated ancillary product liability claims properly brought under Rule 14. The Supreme Court repeatedly has made it clear there are two prerequisites for common law indemnity: (1) the damages which claimant seeks to shift are imposed upon him as a result of some legal obligation to the injured person; and (2) it must appear that the claimant did not actively or affirmatively participate in the wrong. J.B. Hunt Transp., Inc. v. Forrest General Hosp. 34 So. 3d 1171, 1173-74 (Miss. 2010) (quoting Home Ins. Co. of NY v. Atlas Tank Mfg. Co., 230 So. 2d 549, 551 (Miss. 1970). These indemnity prerequisites are met by Hard Rock. As to satisfaction of the first prerequisite, if Hard Rock is ultimately found legally responsible to Roy Anderson for the damages associated with the failures of the PTE cables, the damages will have been imposed as a result of legal obligation to Roy Anderson (i.e., 5
contractual responsibility for the damages associated with the failed PTE cables). In fact, the viability of Hard Rock s Rule 14 claims do not depend on how Roy Anderson has pled its claims against Hard Rock other than the breach of contract claim supplies the contingent legal compulsion (the legal obligation ) needed for Hard Rock s common law indemnity claim against PTE. The second indemnity prerequisite is met as well. Hard Rock was merely the building owner and did not participate in the construction and did not select or install (or manufacture) the PTE cables which failed and caused the damages sought by Roy Anderson. Hard Rock therefore did not and could not have actively or affirmatively participated in the wrong. The Circuit Court also overlooked Hard Rock s breach of warranty claims which alone can support a Rule 14 claim. Claims made under Rule 14 may not only be supported with allegations of indemnity but also with warranty allegations like Hard Rock made herein. Simply put, this case presents the type of situation Rule 14 was designed to address and the Circuit Court erred when it granted PTE s motion to dismiss. The very purpose of common law indemnity is [w]hen one person is required to pay money which another person in all fairness should pay. Bush v. City of Laurel, 215 So. 2d 256, 259 (Miss. 1968). Nothing could be fairer than the manufacturer and supplier of the cables which failed below their specified and rated strengths and caused the damages at issue being brought into the case. ARGUMENT I. Standard of Review. This Court reviews de novo a trial court's grant or denial of a motion to dismiss. Penn. Nat'l Gaming, Inc. v. Ratliff, 954 So. 2d 427, 430 (Miss. 2007) (citing Harris v. Miss. Valley State Univ., 873 So. 2d 970, 988 (Miss.2004)). When considering a motion to dismiss, the allegations in the complaint must be taken as true, and the motion should not be granted unless it 6
appears beyond a reasonable doubt that the plaintiff will be unable to prove any set of facts in support of his claim. Id. at 430-31. In order for this Court to affirm a grant of a Rule 12(b)(6) motion to dismiss, it must be such that no set of facts would entitle the opposing party to relief. Lowe v. Lowndes County Building Inspection Dept., 760 So. 2d 711, 712 (Miss. 2000). See also Overstreet v. Merlos, 570 So. 2d 1196, 1197 (Miss. 1990) (the pleaded allegations of the complaint must be taken as true and a dismissal should not be granted unless it appears beyond a reasonable doubt that the plaintiff can prove no set of facts in support of his claim which entitles him to relief. ). PTE did not and cannot meet this very high standard. The Circuit Court therefore erred in granting the motion to dismiss for the reasons discussed herein. III. The Circuit Court Erred in Granting PTE s Motion to Dismiss. Hard Rock complied with Rule 14 and the controlling case law and stated valid claims against PTE. A read of the language of Rule 14 and its Advisory Committee Notes alone show Hard Rock s third-party claims are proper and PTE s motion was due to be denied. Rule 14(a), provides that a defending party may cause a summons and complaint to be served upon a person not a party to the action who is or may be liable to him for all or part of the plaintiff's claim against him. (emphasis added). Similarly, the Advisory Committee Notes 6 state (emphasis added): It is essential that the third-party claim be for some form of derivative or secondary liability of the third-party defendant to the third-party plaintiff. Impleader is not available for the assertion of an independent action by the defendant against a third party, even if the claim arose out of the same transaction or occurrence as the main claim. Once a third-party claim is properly asserted, however, the third-party plaintiff may assert whatever 6 The Comments to Mississippi Rules of Civil Procedure were repealed by the Supreme Court on July 1, 2014. At that time, the Supreme Court approved for publication the Advisory Committee Notes with the Mississippi Rules of Civil Procedure. 7
additional claims the third-party plaintiff has against the thirdparty defendant under Rule 18(a). The requirement that the third-party claim be for derivative or secondary liability may be met by, for example, an allegation of a right of indemnity (contractual or otherwise), contribution, subrogation, or warranty. In this case, Hard Rock made an indemnity claim and also separate warranty claims 7 along with other claims against PTE for the failed cables which are the subject, in part, of Roy Anderson s claims against Hard Rock. Indemnity and warranty claims are proper third party claims under Rule 14. Hard Rock has made claims against PTE because it may be liable for all or part of plaintiff s claims against it. This is text book common law indemnity and proper under Rule 14. explained: In J.B. Hunt Transp., Inc., 34 So. 3d at 1173-74, the Mississippi Supreme Court Two critical prerequisites are generally necessary for the invocation of noncontractual implied indemnity [common law indemnity] in Mississippi: (1) the damages which the claimant seeks to shift are imposed upon him as a result of some legal obligation to the injured person; and (2) it must appear that the claimant did not actively or affirmatively participate in the wrong. (quoting Home Ins. Co. of NY v. Atlas Tank Mfg. Co., 230 So. 2d 549, 551 (Miss. 1970)). Like with Rule 14, J.B. Hunt shows that Hard Rock s claims are proper. First, the damages which the claimant [Hard Rock] seeks to shift are [or may be] imposed upon him as a result of some legal obligation to the injured person [Roy Anderson]. In other words, one who seeks indemnity cannot be a volunteer and must pay under legal compulsion. Here, Hard Rock has brought its indemnity claim against PTE for damages which may be imposed on it by virtue of a contractual obligation. Indeed, Roy Anderson filed its action against Hard Rock alleging, 7 The Circuit Court did not address the fact that Hard Rock s valid warranty claims against PTE in its Third Party Complaint also support a third party claim under Rule 14. 8
among other things, that Hard Rock is contractually responsible for the costs associated with the cable breaks because it was required, as Owner, to either (A) obtain all risk builder s risk insurance or (B) be liable to RAC [Roy Anderson] for any loss not compensated by such insurance. [R. 10-133 Complaint, 26 and 52]. Hard Rock admitted it was contractually required to obtain the insurance and, in fact, purchased the required insurance [R. 134-148, Answer and Counterclaim, 26 and 52], and simultaneously filed a counterclaim against Roy Anderson since it, as general contractor, is contractually responsible for all workmanship and materials associated with the construction of the subject project. The insurance coverage decision remains pending with the insurance carrier. If coverage is declined or there is only partial coverage (or significant deductibles are invoked), Roy Anderson contends that Hard Rock is contractually responsible for any damages associated with the PTE cable breaks. If Roy Anderson ultimately is successful and it is judicially determined that Hard Rock has contractual liability for the damages associated with the PTE cable breaks, Hard Rock will have to pay Roy Anderson significant damages under legal compulsion ( as a result of some legal obligation ). Second, it must appear that the claimant [Hard Rock] did not actively or affirmatively participate in the wrong. Hard Rock, as merely the building owner, had nothing whatsoever to do with the selection, manufacture or installation of the PTE cables which failed. Again, Hard Rock is alleged to have contractual responsibility only for damages associated with the PTE cable failures. The Supreme Court squarely addressed these issues in Celotex Corp. v. Becknell Constr., Inc., 325 So. 2d 566 (Miss. 1976). Therein, Becknell entered into a contract with the Airport Authority to construct major additions to the property at the airport. Celotex Corp., 325 So. 2d at 566-68. Under the contract with the Airport, Becknell warranted the construction and materials would be free of defects. Id. Becknell entered into subcontracts with Campbell Roofing to 9
construct a roof. Soon after the roof was completed, the roof blistered and leaked. Id. After some effort to repair the roof, the Airport gave notice to Becknell that it would have the roof replaced by another contractor if Becknell did not replace it. Id. Becknell gave notice to Campbell (the roofing subcontractor) and Celotex who supplied Campbell with the roofing materials. Id. When they all failed to act, the Airport replaced the roof and filed suit against Becknell and recovered. Id. Becknell then sued Celotex and Campbell and judgment was entered in Becknell s favor for both the amount paid to the Airport and attorney's fees and costs Becknell incurred in defending the Airport s claim. Id. Celotex appealed and argued Becknell did not have an indemnity claim against it. Id. Relying on Bush v. City of Laurel, the Supreme Court found that Becknell was entitled to indemnity. In so holding, the Supreme Court stated: Becknell was required to pay money because of the defective workmanship of Campbell and defective materials furnished Campbell by Celotex. Becknell s liability arose because it was a prime contractor and warranted all materials and workmanship. Becknell paid the Airport Authority the cost of placing a new roof on the buildings and, in all fairness, this expense should be borne by Campbell and Celotex. We therefore hold Becknell is entitled to recover on the theory of indemnity. Celotex, 325 So. 2d 567-568 (emphasis added). Just like in Celotex, Hard Rock may have a contractual obligation to Roy Anderson (this, of course, is disputed by Hard Rock). Notably, Celotex s indemnity liability was upheld even though it did not have a direct relationship/contract with Becknell and even though the Airport s claims against Becknell were based on the contract only between them. Becknell paid under the terms of its contract with the Airport and then sought indemnity from the real wrongdoer-the one who should fairly bear the loss. This is what Hard Rock did here but was not even allowed to proceed past the motion to dismiss stage. The only difference is the timing in that Hard Rock did not wait until after conclusion of the underlying suit to join the wrongdoer because Rule 14 10
expressly allows third-party claims against one who "may be liable," and the Advisory Committee Notes state it is not an objection to implead that the third party's liability is contingent on the original plaintiff's recovery against the defendant/third-party plaintiff. (emphasis added). Because it was not before the Circuit Court (and Roy Anderson was not even at the hearing on the motion to dismiss) and it, in fact, was not the issue, the Circuit Court simply went astray when it delved into the merits of the dispute between Roy Anderson and Hard Rock. The Circuit Court incorrectly focused on the contract between Hard Rock and Roy Anderson and not the relationship between Hard Rock and PTE, the real wrongdoer for purposes of the damages claimed. For example, the Circuit Court indicates on Page 4 of its Order the contract [between Roy Anderson and Hard Rock] does not give rise to an action for implied indemnity under the facts presented here. [R.E. 421-425, Order]. Similarly, the Circuit Court wrote RAC [Roy Anderson] had a contract with Hard Rock to construct the Project, and that contract provided that RAC [Roy Anderson] would be insured against the very thing that happened, a failure of material on the job and consequential costs. [R.E. 421-425, Order]. With its mistaken focus, the Circuit Court missed the fact Hard Rock stated and satisfied the pre-requisites or elements for common law indemnity which only depend on the Roy Anderson/Hard Rock construction contract to the extent it supplies the legal compulsion needed for the common law indemnity claim. Otherwise the merits of the underlying claim should not have been the focus especially at the motion to dismiss stage. The Circuit Court did though seem to acknowledge Hard Rock might have a common law indemnity claim in its Order. The Circuit Court wrote on page 4 of its Order, [i]f Hard Rock pays it may have an independent cause of action against PTE. [R.E. 421-425, Order]. Why an independent cause of action? If Hard Rock has to pay Roy Anderson and seeks to recover its payment (and its lawyer fees and costs in 11
defending the underlying case) that is the very definition of indemnity. 8 Likewise, as to breach of warranty, the Circuit Court wrote (and acknowledged) on page 4-5 of its Order that [a]ny right of recovery for any loss or damages Hard Rock might have against PTE arises from either warranties implied by law or provided by contract or statute. Again, Rule 14 s Advisory Committee Notes advises that claims made under the rule may not only be supported with allegations of indemnity but also with warranty allegations like Hard Rock made herein. The merits of Roy Anderson s claim simply is not the issue, and the contract between Roy Anderson and Hard Rock only supplies the element of contingent legal compulsion needed to undergird a valid common law indemnity claim under Rule 14. It is of no moment Hard Rock was sued in contract other than it provides the necessary predicate to a successful common law indemnity claim. The damages which the claimant [Hard Rock] seeks to shift will be imposed upon it as a result of some legal obligation to the injured person [Roy Anderson]. The contract between Roy Anderson and Hard Rock therefore is not (and cannot be) some sort of a bar to an indemnity claim by Hard Rock. To be sure, the fact Hard Rock s alleged legal duty/obligation arises from the contract between Roy Anderson and Hard Rock does not somehow disqualify Hard Rock s indemnity claim. Further, the underlying claim indisputably emanates from the failure of the PTE cables and the damages those failures caused and the test is 8 The Circuit also writes on page 4 of its Order that [b]oth parties concede that the products liability claims cannot be heard in this case. [R.E. 421-425, Order]. That is not correct. Hard Rock never conceded its product liability claims could not be heard in this case. To be sure, such claims most definitely can be heard in this case as long as there are valid third party claims under Rule 14. Here, the common law indemnity and warranty claims are valid and thus the product liability claims can be joined herein. The Advisory Committee Notes to Rule 14 state: Once a third-party claim is properly asserted, however, the third-party plaintiff may assert whatever additional claims the third-party plaintiff has against the third-party defendant under Rule 18(a). 12
articulated in J.B. Hunt. If Roy Anderson is successful, Hard Rock will be legally compelled to pay for the damages caused by the PTE cable failures but also will be passive or without active fault because it was merely the building owner and had nothing whatsoever to do with the selection, manufacture or installation of the PTE cables which failed. Regardless, any determination of fault by Hard Rock cannot be made via a Rule12(b)(6) motion or even summary judgment in most cases, let alone based on any allegation in Roy Anderson s complaint as PTE argued. "[T]he determination of whether a party is actively or passively negligent is a question of fact and depends upon the facts of each case." Richardson v. Clayton & Lambert Manufacturing Co., 634 F. Supp.1480, 1488 (N.D. Miss. 1986). See also Magnolia Constr. Co., Inc. v. Miss. Gulf S. Engineers, Inc., 518 So. 2d 1194, 1200 (Miss. 1988) (whether or not a party performed negligently in a manner precluding an indemnity claim is a genuine issue of material fact that "must be decided by the trier of facts at a trial on the merits"); Miss. CODE 11-7-17 ("All questions of negligence and contributory negligence shall be for the jury to determine. ). CONCLUSION MRCP 14 and controlling case law such as Celotex Corp. v. Becknell Constr., Inc. mandate the resolution of this appeal in favor of Hard Rock. PTE s motion traveled under Rule 12(b)(6), which, to be successful, requires that no set of facts (pled or not) could exist to support Hard Rock s claim. Although this is not even close on these facts, the Supreme Court also has observed that the determination of whether or not indemnity should be allowed must of necessity depend on the facts of each case. Home Ins. Co. of NY, 230 So. 2d at 551 (citations omitted). Hard Rock made a rock solid common law indemnity claim AND breach of warranty claims which were inexplicably overlooked by the Circuit Court in its Order. Hard Rock also properly included ancillary product liability claims against PTE pursuant to Rule 14. Again, the 13
very purpose for common law indemnity is when one person is required to pay money which another person in fairness should pay. Bush, 215 So. 2d at 259. This loss can either fall on Hard Rock (the building owner), Roy Anderson (the general contractor which constructed the building) or the wrongdoer, PTE, the manufacturer of the eighteen (18) cables which failed below their specified and rated strengths. This is the type of situation Rule 14 was designed to address and the rule allows all of these claims to be resolved in one action. For these reasons, the Circuit Court s grant of the motion to dismiss should be reversed. RESPECTFULLY SUBMITTED, this the 16 th day of November, 2016. PREMIER ENTERTAINMENT BILOXI LLC d/b/a HARD ROCK HOTEL & CASINO BY: s/james J. Crongeyer, Jr. James J. Crongeyer, Jr. OF COUNSEL: Michael W. Ulmer MSB #5760 James J. Crongeyer, Jr. MSB #10536 Watkins & Eager PLLC Post Office Box 650 Jackson, MS 39205 Telephone: 601-965-1900 Facsimile: 601-965-1901 mulmer@watkinseager.com jcrongeyer@watkinseager.com 14
CERTIFICATE OF SERVICE I, James J. Crongeyer, Jr., do hereby certify that I have this day filed the foregoing with the Clerk of the Court using the MEC system, which sent notification of such filing to all counsel of record. I also certify that I have mailed, via U.S. Mail, postage prepaid, a true and correct copy of the foregoing to: Honorable Roger T. Clark Circuit Judge Post Office Box 1461 Gulfport, MS 39502 This the 16 th day of November, 2016. s/james J. Crongeyer, Jr. James J. Crongeyer, Jr. 15