Pacific Gas & Elec. Co. v. G. W. Thomas Drayage & Rigging Co.

69 Cal.2d 33, 442 P 2d 641 (1968)

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Nature of the Case

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Facts

G.W. Thomas (D) contracted to replace an upper metal cover on Pacific's (P) steam turbine. D agreed to do the work 'at its own risk and expense and to indemnify' P against 'all loss, damage, expense, and liability resulting from injury to property' or from any act of D connected with performing the contract. D agreed to procure not less than $50,000 in insurance to cover liabilities for injuries to property. P was to be listed as an additional insured. A cover fell and damaged an exposed turbine rotor. The damage would cost $25,144.51 to fix. D refused to pay for the damage and P sued. D offered proof that the indemnification of property was supposed to be for third parties only and was not to cover P's property. This proof was in the form of admissions by P's agents, and of the course of dealing between P and D. After determining that the contract had a plain meaning, the court refused to admit any extrinsic evidence that would contradict its interpretation. The court awarded P damages; the contract had a plain meaning such that D's parol evidence was not admissible. D appealed.