AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

• The City of Taos contracted L.C.I.2, Inc. to construct a structure around a pre-existing recreation area. L.C.I.2 subcontracted Newt & Butch’s Sheet Metal, Inc. for the roofing, which included an indemnification clause making L.C.I.2 an "additional insured" under Newt & Butch’s policy with Nationwide Mutual Insurance Company. While working, Plaintiff Bobby Windham fell through a skylight cutout into an empty swimming pool, leading to a lawsuit against L.C.I.2 for negligence. L.C.I.2 sought defense and indemnification from Nationwide under the policy (paras 2-4).

Procedural History

• District Court of Taos County, Michael E. Vigil, Judge: Granted L.C.I.2’s motion for summary judgment and denied Nationwide’s motion for summary judgment (para 5).

Parties' Submissions

• Plaintiff: Argued that L.C.I.2 was negligent for not covering skylight cutouts and not enforcing safety rules, leading to the accident. Plaintiff’s wife sought damages for loss of consortium (para 3).
• L.C.I.2: Denied liability, attributing the negligence to the subcontractor or a third party, and sought defense and indemnification from Nationwide as an additional insured under the policy (paras 3-4).
• Nationwide: Accepted defense under reservation of rights but sought a declaratory judgment that it had no duty to defend or indemnify L.C.I.2, arguing the incident might not arise out of Newt & Butch’s operations or could be due to L.C.I.2’s own negligence (para 4).

Legal Issues

• Whether Nationwide has a duty to defend and indemnify L.C.I.2 under the commercial general liability policy issued to Newt & Butch.
• Whether the indemnification agreement and the duty to defend under the policy violate NMSA 1978, Section 56-7-1 (2003), and are thus void and unenforceable (paras 4-5, 10-11).

Disposition

• The district court's order granting L.C.I.2’s motion for summary judgment and denying Nationwide’s motion for summary judgment was affirmed (para 19).

Reasons

• Per VIGIL, J. (BUSTAMANTE, J., and FRY, J., concurring):
  The court held that Section 56-7-1 does not void Nationwide’s obligation to provide L.C.I.2 a defense, aligning with the precedent set in City of Albuquerque v. BPLW Architects & Eng’rs, Inc. The statute allows for indemnification and defense obligations when liability arises out of the subcontractor's operations performed for the contractor. The court distinguished between the duty to defend and the duty to indemnify, emphasizing that the duty to defend exists if the allegations potentially bring the case within the coverage of the policy, regardless of the insured's ultimate liability (paras 10-18).