# S&B Engineers & Constructors, Ltd. v. Scallon Controls, Inc. Supreme Court of Texas, No. 24-0525 **S&B Engineers & Constructors, Ltd. v. Scallon Controls, Inc., No. 24-0525 (Tex. Mar. 13, 2026). Holding: Jinkins, which held that a settling defendant has no common-law or statutory contribution right against a non-settling party, does not bar recovery under a freely negotiated contractual proportional-indemnity provision, and the express-negligence doctrine does not apply because the contract disclaims indemnity for S&B's and Sunoco's own negligence, so S&B and Zurich may pursue indemnification, and Zurich's claim is not time-barred.** Practice areas: indemnity, insurance ## Key issues - A proportional-indemnity clause can allow settling defendants to recover from a non-settling subcontractor its share of the settlement; the 1987 rule that a settling defendant has no contribution right (Beech Aircraft v. Jinkins) does not bar contractual indemnity. - The Court reversed the summary judgment for Scallon Controls and remanded, over a four-Justice dissent. ## Factual History Sunoco hired S&B Engineers & Constructors, Ltd. to design and install a safety system at its South Texas refinery, S&B hired Scallon Controls, Inc. to supply and program a fire-suppression system, and in January 2015 a brief power loss triggered the system's chemical suppressant while another contractor's employees worked on tall scaffolding, causing seven workers to fall (Opinion, PDF p. 3). The workers sued S&B and Sunoco, which filed a third-party suit against Scallon for breach of contract, breach of warranty and enforcement of the indemnity provisions, and in May 2019 the workers settled with S&B and Sunoco for amounts paid by S&B, its insurers and Sunoco's insurer, Zurich American Insurance Company, in a settlement that did not mention Scallon (Opinion, PDF pp. 3-4). The purchase agreement has Scallon indemnify S&B "to the extent of [Scallon's] negligence," and in cases of comparative or concurrent negligence limits its duty to its "allocable share" (Opinion, PDF pp. 4-5). The dissent adds that S&B had not timely designated Scallon as a responsible third party and that the settlement denies any liability (Dissenting Opinion, PDF pp. 3-4). ## Procedural History Sunoco nonsuited its claims against Scallon in December 2021 and Zurich intervened the next day to assert subrogation claims, and S&B and Zurich then sought indemnification from Scallon for its proportional share of the settlement (Opinion, PDF pp. 4-5). The trial court granted Scallon's summary-judgment motion and the Ninth Court of Appeals (Beaumont) affirmed, holding that the express-negligence doctrine barred indemnification, that the record could not support a contribution claim and that Zurich's claims were time-barred (Opinion, PDF p. 5). The Supreme Court granted both petitions, heard argument on October 9, 2025 and on March 13, 2026 reversed and remanded (Opinion, PDF pp. 1, 5, 14). ## Issues Presented - S&B and Zurich (Opinion, PDF pp. 2, 5): whether they may recover from Scallon its proportional share of their settlement under the contract's proportional-indemnification provision, and whether Zurich's claim was time-barred. - Scallon (Opinion, PDF pp. 2, 5): whether the voluntary settlement, to which it was not a party, extinguished any indemnification right under *Beech Aircraft v. Jinkins* and the express-negligence doctrine. ## Standard(s) of Review The Court construed the indemnity contract under ordinary rules of contract construction, with the express-negligence doctrine as the one special rule for indemnity agreements (Opinion, PDF pp. 8-9). ## Legal Arguments **Whether a settlement bars proportional contractual indemnity.** **S&B and Zurich (Petitioners):** The contract entitles them to proportional indemnification from Scallon for its allocable share of negligence, which a factfinder can determine after a settlement, and the injuries were caused by Scallon, not by their negligence (Opinion, PDF pp. 2, 5, 11). **Scallon (Respondent):** The voluntary settlement extinguished any indemnification rights, because under *Jinkins* a settling defendant can settle only its own share of liability and the express-negligence doctrine bars shifting the cost of its own negligence to Scallon (Opinion, PDF pp. 2, 5). **Whether Zurich's claim is timely.** **Zurich (Petitioner):** Its claim is not time-barred because indemnity claims accrue only when the indemnitee's liability becomes fixed through settlement or judgment (Opinion, PDF p. 13). ## Stated Reasons the Court Should Take the Case The opinion does not recite the petitions' reasons, but it notes that numerous amici confirmed that proportional-indemnity agreements are commonplace among contractors and subcontractors on shared projects (Opinion, PDF p. 11). ## Oral Argument - **Measure of damages.** Asked the damages measure after a settlement for one's own negligence, petitioners' counsel said it is the indemnitee's percentage of fault, if the settlement was reasonable and in good faith. (Oral Argument, 0:01:51; 0:04:50) - **Their liability unchanged.** Asked what the plaintiffs' settlement did to its liability, respondent's counsel said nothing; the settling parties only settled their own slice. (Oral Argument, 0:32:39) - **Buying their peace.** Respondent's counsel said a party cannot settle for someone else; the settling parties chose to buy their own peace. (Oral Argument, 0:26:02) - **Burden to challenge.** Asked how a non-settling party can challenge the settlement, petitioners' counsel said they are not asking for anything new, and the plaintiffs would not ordinarily be witnesses. (Oral Argument, 0:10:51; 0:12:03) - **Why not sued.** Asked why the plaintiffs did not sue respondent, its counsel said he did not think there is any indication, and respondent was never named a responsible third party. (Oral Argument, 0:40:36) - **UCC damages.** Asked if the settlement is recoverable as consequential damages under the UCC, respondent's counsel said no, since those damages apply between buyer and seller. (Oral Argument, 0:31:44) - **Allowed to prove it.** Asked why respondent should not at least be allowed to prove its point at trial, its counsel said current law does not allow it, and parties are free to contract. (Oral Argument, 0:42:12) ## Practice Area Tags indemnity, insurance ## Procedural Posture/Vehicle Two petitions for review from the Ninth Court of Appeals (Beaumont) after summary judgment; argued October 9, 2025; opinion by Justice Young issued March 13, 2026 (Opinion, PDF pp. 1, 14). ## Amicus Involvement Numerous amici wrote to confirm that contractual agreements for proportional indemnification are commonplace, which are not summarized here (Opinion, PDF p. 11). ## Holding *Jinkins*, which held that a settling defendant has no common-law or statutory contribution right against a non-settling party, does not bar recovery under a freely negotiated contractual proportional-indemnity provision, and the express-negligence doctrine does not apply because the contract disclaims indemnity for S&B's and Sunoco's own negligence, so S&B and Zurich may pursue indemnification, and Zurich's claim is not time-barred (Opinion, PDF pp. 2-3, 6-11, 13-14). ## Standard of Review De novo construction of the indemnity contract under ordinary contract principles, after summary judgment (Opinion, PDF pp. 8-9). ## Court's Reasoning *Jinkins* addressed only common-law and statutory contribution and did not mention contracts or indemnification, and contractual indemnity differs because the parties bargained for it, so a defendant is enforcing a right it already has and not buying the plaintiff's claims (Opinion, PDF pp. 6-7). Chapter 33 expressly preserves contractual indemnity rights, post-settlement indemnity suits are long established under *Fireman's Fund*, and the contract's language covering "any and all loss" encompasses settlements (Opinion, PDF pp. 7-9). The express-negligence doctrine is satisfied because the contract disclaims indemnity for the indemnitee's own negligence and limits Scallon to its "allocable share," so no special language is needed for proportional indemnity (Opinion, PDF pp. 9-11). On remand the settling parties must prove the settlement was made in good faith for a reasonable amount and the share attributable to Scallon's negligence, risks that discourage bad settlements, and the resulting trial is more streamlined than a trial of the underlying injuries (Opinion, PDF pp. 11-13). Zurich's claim accrued when the settlement fixed Sunoco's liability, less than three years before it intervened (Opinion, PDF pp. 13-14). Justice Bland, joined by Justices Lehrmann, Devine and Huddle, dissented, reasoning that the express-negligence rule and *Jinkins* mean S&B's settlement paid only for its own negligence, that "allocable" does not turn that payment into Scallon's share, and that the ruling creates an unfair new species of trial (Dissenting Opinion, PDF pp. 1-2, 6-9, 13-14). ## Disposition Court of appeals' judgment reversed and the case remanded to the trial court for further proceedings (Opinion, PDF p. 14). ## Vote Breakdown, Authorship, and Any Concurrence/Dissent Justice Young delivered the opinion, joined by Chief Justice Blacklock and Justices Busby, Sullivan and Hawkins, and Justice Bland dissented, joined by Justices Lehrmann, Devine, and Huddle (Opinion, PDF p. 1). --- Source: The SCOTX Report, https://scotxreport.com/cases/24-0525. AI-generated summary of the Court's opinion, orders and the parties' briefs, with pin cites to the page of each document; verify against the Court's own documents at search.txcourts.gov.