Indemnity Agreement Contractor Negligence In California

Rossmoor Sanitation, Inc. v. Pylon, Inc. (1975) involved the rights and obligations of parties to an indemnity agreement (a general contractor/indemnitor and an owner/indemnitee), and of the parties' respective insurers. Rossmoor upheld the lower court's finding that the contractor was negligent and the owner was not actively negligent, requiring the contractor to indemnify the owner under the terms of the parties' indemnity contract. (Id. at p. 633.) Rossmoor additionally held the owner's insurance coverage provided by a direct insurer was excess over coverage provided by an additional insured provision in the contractor's policy. (Id. at pp. 633-634.) But the court did not hold an indemnitee's policy will always be excess. the court instead made clear it was reaching its conclusion based on the particular circumstances of the case. (Id. at p. 634.) The court said the "one factor" it found "compelling" was that the parties had specifically bargained for the contractor to bear the entire costs resulting from its negligent conduct and for the owner to be relieved of any liability where it was not actively negligent. (Ibid.)