Raytheon Engineers & Constructors, Inc. v. Sargent Elec. Co., 932 N.E. 2d 691 (Ind. Ct. App. 2010) arose from the construction of a coke battery plant on property owned by Inland Steel Company. Raytheon, the engineer and general contractor, hired Sargent to provide and install electrical transformers. The specifications provided by Raytheon required the transformers to have a Wye Primary and a Wye Second configuration. A Wye-Wye transformer is grounded to a neutral, but Sargent was never told that Inland’s technical engineering guidelines required the primary winding for the transformers to be in a “Delta” configuration, which is not grounded. Predictably, the transformers installed by Sargent failed, causing a power loss which in turn caused a blast furnace to lose power. Molten steel was spilled onto Inland’s property. Inland sustained damages exceeding $25 million, and filed a negligence action against Raytheon, which sought indemnity from Sargent.
The trial court entered summary judgment in favor of Sargent, and the Court of Appeals affirmed. The indemnity provision in Sargent’s subcontract did not apply to damage resulting from Raytheon’s sole negligence or willful misconduct, of Raytheon or other contractors responsible to Raytheon. Here, Sargent was not negligent. Sargent “hooked in” the transformers consistent with drawings provided by Raytheon. Citing the rule of Peters v. Forster, 804 N.E. 2d 736, 742 (Ind. 2004), the court explained that there is no breach of duty, and therefore no negligence, when a contractor merely follows the plans given to him so long as they are not obviously dangerous or defective such that no reasonable contractor would follow them. Accordingly, Raytheon was not entitled to indemnity.