Sunday, December 1, 2013

Pacific Gas & Electric Co. v. G.W. Thomas Drayage & Rigging Co. case brief

Pacific Gas & Electric Co. v. G.W. Thomas Drayage & Rigging Co. case brief summary
442 P.2d 641 (1968)


CASE SYNOPSIS
Defendant contractor appealed from a judgment of the Superior Court of the City and County of San Francisco (California), holding that an indemnity clause covered damages to all property, regardless of ownership, in plaintiff utility company's action to recover damages to property under the indemnity clause.

CASE FACTS
Defendant contractor appealed from a judgment for plaintiff utility company in an action to collect damages under an indemnity clause of a contract. Defendant contracted to repair plaintiff's steam turbine, promising to indemnify plaintiff for all property damage. The turbine was damaged during repairs. Defendant argued that the parties intended that defendant would indemnify plaintiff only for damage to the property of third parties. Relying on the plain meaning of the contract language, the trial court concluded that defendant was liable. Defendant appealed.

DISCUSSION

  • The court reversed the judgment, holding that looking only at the plain meaning of contractual language ignored the possibility that the parties had contrary intentions. 
  • The court therefore held that parol evidence was admissible to ascertain the true intent of the contractual parties even where the writing seemed clear and unambiguous.

CONCLUSION
The court reversed the judgment, holding that parol evidence was admissible to ascertain the true intent of the contractual parties even where the writing seemed clear and unambiguous.

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