USCA1 Opinion
May 5, 1994 [NOT FOR PUBLICATION]
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
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No. 94-1125
DAVID J. YEADON,
Plaintiff, Appellant,
v.
PIZZA HUT OF AMERICA, INC.,
Defendant, Appellee.
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APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Frank H. Freedman, Senior U.S. District Judge]
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Before
Torruella, Selya and Cyr,
Circuit Judges.
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Dennis P. Powers, Katz, Argenio & Powers on brief for
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appellant.
Thomas M. Elcock, Debra A. Joyce, Carole Sakowski Lynch and
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Morrison, Mahoney & Miller on brief for appellee.
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Per Curiam. Appellant David Yeadon appeals the grant of
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a motion for summary judgment in favor of appellee, Pizza
Hut, in regard to Yeadon's claim that Pizza Hut was
vicariously liable for damages incurred by him in an accident
caused by Dwight Spaulding, an employee of Pizza Hut. This
diversity action is governed by Massachusetts law. We
summarily affirm.
I
In April 1990, Yeadon was injured in an automobile
accident when a vehicle driven by Spaulding collided with
Yeadon's car. At the time of the accident, Spaulding was
acting within the scope of his employment with Pizza Hut. In
March 1991, Yeadon, in return for a payment of $15,000 from
Spaulding's insurance carrier, Arbella Mutual Insurance
Company, executed a release which reads as follows:
In consideration of FIFTEEN THOUSAND ($15,000.00)
dollars to be paid by ARBELLA MUTUAL INSURANCE CO.
the receipt whereof is hereby acknowledged I hereby
remise, release and forever discharge the said
Arbella Mutual and Dwight J. Spaulding of and from
all debts, demands, actions, causes of action,
suits, accounts, covenants, contracts, agreements,
damages, and any and all claims, demands and
liabilities whatsoever of every name and nature,
both in LAW and in EQUITY, which against the said
Dwight J. Spaulding or his heirs and assigns I now
have or ever had from the beginning of the world to
this date and more especially on account of [an]
automobile accident on April 11, 1990. The
undersigned specifically reserves all rights as
against Pizza Hut and Dwight J. Spaulding as its
agent.
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The release was signed by Yeadon and witnessed by his
attorney. In March 1993, Yeadon brought suit against
Pizza Hut, on the ground that it was vicariously liable for
the damages from the accident. The district court found that
Yeadon had released Spaulding from all liability and that
under Massachusetts law the release of an agent precluded a
derivative claim against the principal. The court therefore
granted Pizza Hut's motion for summary judgment.
II
Yeadon raises two arguments on appeal. First, he argues
that the district court erred in interpreting the March 1991
contract as an unambiguous release of Spaulding from all
liability. Second, he contends that, even if the contract is
so interpreted, Massachusetts law does not bar a claim in his
case.
Yeadon asserts that his intent in the March 1991
contract was to grant an absolute release to Arbella but to
grant only a qualified release to Spaulding and to preserve a
complete right of action against Pizza Hut. He relies
primarily upon the explicit language of the release to the
effect that he "specifically reserves all rights as against
Pizza Hut and Dwight J. Spaulding as its agent." He also
seeks to support his interpretation by reference to
circumstances surrounding the agreement. Since, in spite of
the language referred to by appellant, we find the release to
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be "unambiguous in regard to the question at hand," Hermes
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Automation Technology, Co. v. Hyundai Electronics Industries,
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Co., 915 F.2d 739, 747 (1st Cir. 1990) (citing cases), i.e.,
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its grant of a complete release to Spaulding, we eschew
reliance on external evidence and limit our consideration to
the plain meaning of the language of the contract, see
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Commercial Union Ins Co. v. Walbrook Ins. Co., 7 F.3d 1047,
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1052-53 (1st Cir. 1993) (applying Massachusetts law).
With the exception of the last sentence, the March 1991
contract is a standard preprinted release form filled in with
the information relevant to the accident of April 11, 1990.
The form is entitled as a "Release from All Demand" and its
language grants a complete release from all liability for the
accident to "Arbella Mutual and Dwight J. Spaulding."
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(emphasis added). The only possible qualification to this
unqualified release is the last sentence of the contract
which purports to "reserve all rights as against Pizza Hut
and Dwight J. Spaulding as its agent." Unless this sentence
can be read as a retraction of the release granted
immediately above, it must mean that appellant intended to
preserve his right of action against Pizza Hut and to reserve
a right against Spaulding only as a means for reaching Pizza
Hut. However, if Pizza Hut were to be found vicariously
liable for any damages to Yeadon due to the actions of
"Spaulding as its agent," Pizza Hut would have a right to
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seek indemnity from Spaulding. See Elias v. Unisys Corp.,
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410 Mass. 479, 483, 573 N.E.2d 946, 949 (1991). The effect
of the reference to Spaulding in the final sentence then
would be to subject him to liability for the damages from
which the contract purports to release him. Spaulding,
therefore, would have paid, through his insurer, $15,000
compensation without having acquired complete protection from
further liability. Rather than reading the last sentence as
a negation of the complete release plainly granted Spaulding
in the remainder of the document, we find that, read in the
light of the contract as a whole, see Cullen Enterprises,
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Inc. v. Massachusetts Property Ins. Underwriting Ass'n, 399
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Mass. 886, 900, 507 N.E.2d 717, 725 (1987) ("contract must be
interpreted as a whole to give effect to its general
purpose"), the last sentence preserves a right only against
Pizza Hut and has no effect on the release of Spaulding from
further liability.
Interpreting the contract as an unqualified release of
Spaulding from all liability stemming from the April 1990
accident, we further find that Massachusetts law bars
recovery against Pizza Hut. In facts analogous to those of
this case, the Supreme Judicial Court held that "the release
of an agent precludes a claim against his principal who is
liable solely on the theory of respondeat superior." Elias,
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410 Mass. at 484, 573 N.E.2d at 949. Yeadon attempts to
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distinguish Elias first on the ground that in Elias the
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plaintiff had granted the agent a general release whereas
Yeadon explicitly reserved his right against Pizza Hut. This
argument is unavailing since, according to Elias, the release
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of Spaulding barred, as a matter of law, any claim against
Pizza Hut. Therefore, the attempt by Yeadon to reserve his
rights against Pizza Hut was legally meaningless.
Yeadon also asserts that the "essence" of Elias is that
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an injured party be "fully compensate[d for] an injury caused
by the act of a single tortfeasor." Id. at 483, 573 N.E.2d
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at 948 (citation omitted). Inasmuch as Yeadon now alleges
that he did not receive full compensation for his injuries
from Spaulding, he claims that Elias allows him to seek
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further compensation directly from Pizza Hut.
According to the rules of vicarious liability, "[i]f the
ultimately responsible agent is unavailable or lacks the
ability to pay, the innocent victim has recourse against the
principal." Id. However, in the instant case, Spaulding,
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through his insurer, had the ability to pay $15,000 which
Yeadon accepted as the price of a release. According to
Elias, in a situation where "the agent . . . has means to
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pay, invocation of the doctrine [of vicarious liability] is
unnecessary because the injured party has a fund from which
to recover." Id. We find nothing in Elias, nor has Yeadon
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called our attention to anything, which would limit the
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effect of an agent's release to situations where the
plaintiff concedes after the fact to having been "fully
compensated." Having granted Spaulding a release in
consideration of $15,000 compensation, Yeadon has no recourse
under Massachusetts law against Pizza Hut in the
circumstances at bar.1
Affirmed. See 1st Cir. Loc. R. 27.1.
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1. Of course, this does not mean that the reservation of
rights was a nullity or otherwise illusory. It sufficed to
preserve claims against Pizza Hut for direct (as opposed to
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vicarious) liability, e.g., if Pizza Hut had furnished
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Spaulding with a defective vehicle, and the defect
contributed to the occurrence of the accident. By like
token, the reservation sufficed to preserve claims against
Pizza Hut arising out of different accidents or occurrences
(not involving Spaulding).
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