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Indiana Insurance Co. v. Barnes12/6/2005
mp; Sur. Co. (1987), 32 Ohio St.3d 238, 240. Indemnification may also be implied from a contractual agreement or relationship. Id. Here, there is no express indemnity agreement. Thus, if any right to indemnification exists, it must be implied.
{ } Implied indemnification is recognized when the party committing the wrong is so related to a secondary party that the secondary party becomes liable for the wrongs committed solely by the other. Reynolds v. Physicians Ins. Co. of Ohio (1993), 68 Ohio St.3d 14, 16, citing Losito v. Kruse (1940), 136 Ohio St. 183, 185. Thus, an implied right to indemnification arises only within the context of a relationship wherein one party is found to be vicariously liable for the acts of a tortfeasor. Spalding v. Coulson (1995), 104 Ohio App.3d 62, 75, citing Reynolds, supra, at 16. In addition, the party seeking indemnification must be passively, not actively, negligent. Mahathiraj v. Columbia Gas of Ohio, Inc. (1992), 84 Ohio App.3d 554, 564, jurisdictional motions denied (1993), 66 Ohio St.3d 1489.
{ } The Ohio Supreme Court has recognized that implied indemnification may arise out of the master/servant relationship and the application of the doctrine of respondeat superior. In Losito, supra,the court held that an employer who is judged liable for personal injuries caused solely by the negligence of an employee may sue the employee to recover the damages paid on the employee's behalf. Id., at paragraph one of the syllabus. Here, implied indemnification would allow Gauer to collect the damages it was required to pay to Mr. Zarlino from Barnes.
{ } Therefore, to be able to recover from Barnes, Indiana must rely on the right of subrogation. Subrogation is defined as " he substitution of one party for another whose debt the party pays, entitling the paying party to rights, remedies, or securities that would otherwise belong to the debtor." Black's Law Dictionary (8 Ed.2004). Specific to insurance law, subrogation is also defined as " he principle under which an insurer that has paid a loss under an insurance policy is entitled to all the rights and remedies belonging to the insured against a third party with respect to any loss covered by the policy." Id. In essence, subrogation allows one person to stand in the shoes of another and exercise the rights or privileges of that person.
{ } Indiana submits that, as the subrogee of Gauer, it stands in Gauer's position to assert Gauer's right of implied indemnification against appellant. However, Indiana's right to subrogation arises from its contractual relationship with Gauer. That relationship is defined within the issued insurance policy. Under the plain language of that policy, Barnes was a named insured at the time of the automobile accident. Given that fact, to allow Indiana to exercise Gauer's right to implied indemnification is tantamount to allowing Indiana to subrogate against its own insured. This runs contrary to the fundamental principle of insurance law. An insurer has no right of subrogation against its insured.
{ } It appears that the Ohio Supreme Court has not specifically addressed the situation that arises when an insurance company attempts to recover under a combined theory of implied indemnification and subrogation. Likewise, we have not had occasion to examine that specific issue. However, we find no precedent that allows a subrogated insurance carrier to sue its insured under a theory of implied indemnification.
{ } To the contrary, courts have consistently forbidden insurers from exercising a right of subrogation against their own insureds, regardless of the factual circumstances. In Globe Ins. Co. v. Sherlock (1874), 25 Ohio St. 50,the Ohio Supre
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