Security Administration Services, Inc. v. Baltimore Gas & Electric Co.

WILNER, Judge. This is a preliminary skirmish between Security Administration Services, Inc. (SASI) and Baltimore Gas and Electric Co. (BG & E) over who is responsible for defending an action brought by one Otis Lee Councill and for paying any judgment arising from that action. Mr. Councill was a uniformed security guard employed by SASI. Pursuant to a contract between SASI and BG & E, he was assigned to guard BG & E’s Crane Station plant, and was in the course of doing so when, on August 5, 1980, he was hit by a truck allegedly owned by BG & E and ⁵² driven in a negligent manner by one of its employees, Willie Graham.

Mr. Councill apparently collected workmen’s compensation benefits through SASI’s workmen’s compensation insurance; he and the carrier then sued BG & E and Graham in the Circuit Court for Baltimore City. BG & E and Graham pled to the declaration and filed a third party claim against SASI. The third party claim was based on the contract between BG & E and SASI, under which SASI allegedly undertook (1) to provide a safe place to work for its employees, (2) to defend any action brought against BG & E as the result of work performed under the contract, and (3) to indemnify BG & E against any proceedings or damages arising from the performance of the work covered by the contract. SASI demurred to the third party claim on a number of grounds, two of which are relevant here: (1) the indemnification provision relied upon by BG & E falls within the purview of Md.Code Ann.Cts. & Jud.Proc. art., § 5-305, and, by reason of that statute, is void as being against public policy, and (2) the contract, in any event, does not require SASI to indemnify BG & E and Graham for their own negligence.

The issues were briefed and argued; on March 19, 1984, after a hearing, the court overruled the demurrer without explanation and directed SASI to answer the third party claim-. Unwilling to accept that decision, SASI sought another bite of the apple. With its answer (in which, among other things, it denied having executed the documents alleged by BG & E to be the contract between the parties) SASI filed, in the Councill case, a cross-bill for declaratory judgment and injunctive relief and a motion for preliminary injunction. The cross-bill raised precisely the same issues raised in the demurrer — that the indemnification provision was both inapplicable and void — and it asked for a declaratory judgment to that effect.

The cross-bill and the accompanying motion also sought a preliminary injunction restraining BG & E and Graham from making any effort to enforce ⁵³ that provision against SASI, including making any demand that SASI defend BG & E in the action brought by Councill, pending a determination, on the merits, of the validity and enforceability of the provision. SASI did not request a hearing on its motion for preliminary injunction. On May 16, 1984, the court, without a hearing, denied