Bituminous Casualty Corporation v. Plano Molding Company

Plaintiff insured Defendant manufacturer of storage molds under CGL policy. After train derailment, allegedly caused by molds breaking through floor of container and falling onto tracks, various cargo owners sued Defendant for damages to their goods. Plaintiff defended Defendant under reservation of rights until Seventh Circuit determined that only causes of action by shipping company and railroad against Defendant stemmed from its contractual obligations under bill of lading. Language on bill of lading unequivocally states that Defendant warranted that stowage and seals of containers were safe and proper and suitable for handling and carriage. Thus, Defendant agreed to indemnity shipping company and railroad against their own negligence. Parties to contract intended that Defendant's indemnification liability would be restricted to its breach of warranties in contract. (JORGENSEN and BIRKETT, concurring.)