No. 99,451
IN THE COURT OF APPEALS OF THE STATE OF KANSAS
SHELLY K. HERRELL,
Appellee,
v.
NATIONAL BEEF PACKING COMPANY, LLC,
Appellant,
and
TERRACON CONSULTANTS, INC. & LIBERTY MUTUAL FIRE INS. COMPANY,
Appellees.
SYLLABUS BY THE COURT
1. To establish a claim of negligence against a defendant, a plaintiff must show that the defendant owed the plaintiff a duty of care; that the defendant breached that duty; that the plaintiff suffered injury; and that there existed a causal connection between the duty breached and the injury suffered.
2. This court has unlimited review of the trial court's conclusion that a defendant owed a duty of care to a plaintiff.
3. Generally, an occupier of land owes a duty of reasonable care under the circumstances to all entrants on the property who are present with the owner or occupier's consent.
4. A landowner is not liable to an employee of an independent contractor covered by workers compensation for injury sustained as a result of the breach of a nondelegable duty imposed upon the landowner by statute or ordinance.
5. The inherently dangerous activity exception to the nonliability of a landowner does not extend to employees of an independent contractor covered by workers compensation.
6. A landowner is not liable in tort on a theory of negligence to an employee of an independent contractor covered by workers compensation for injury resulting from a dangerous condition known to or discoverable by the landowner, absent evidence that the landowner exerted a significant degree of control over the details of the independent contractor's project and work activities.
7. Based on the policy reasons advanced by our Supreme Court in Dillard v. Strecker, 255 Kan. 704, 877 P.2d 371 (1994), the plaintiff employee in this case is precluded from bringing her claims of negligence against the defendant landowner.
Appeal from Ford District Court; DANIEL L. LOVE, judge. Opinion filed February 27, 2009. Reversed and remanded with directions.
David J. Rebein and Aaron L. Kite, of Rebein Bangerter PA, of Dodge City, for appellants.
Matthew L. Bretz and Mitchell W. Rice, of Bretz Law Offices, of Hutchinson, for appellee Shelly K. Herrell.
Before McANANY, P.J., GREEN and BUSER, JJ.
GREEN, J.: In this premises liability case, a subcontractor's employee, Shelly K. Herrell, was injured when she stepped into a hole in the concrete floor of the landowner's (National Beef Packing Company [National Beef]) plant. Herrell was working at the plant to obtain soil samples for testing. Herrell sued National Beef, alleging that National Beef was negligent in creating, maintaining, and failing to warn of the dangerous condition; in violating an Occupational Safety and Health Administration (OSHA) regulation; in failing to inspect the premises; and in failing to keep the business place safe. Because Herrell's injuries were covered by workers compensation, National Beef asserted that Herrell's claims of negligence were barred by the rule and the policy reasons established in Dillard v. Strecker, 255 Kan. 704, 877 P.2d 371 (1994).
In Dillard, our Supreme Court stated that a landowner was not liable for the negligence of an independent contractor which resulted in a work-related injury to an employee of the independent contractor when the employee was covered by workers compensation. 255 Kan. 704, Syl. ¶ 3.The trial court disagreed, determining that Dillard did not control because National Beef had created the dangerous condition of the hole by continuing to operate the plant during the construction. The question before us is whether Herrell's claims of negligence against National Beef in causing her injuries are controlled by the Dillard holding.
Although Dillard limited its decision to two theories of landowner liability–breach of a nondelegable duty assigned by statute or ordinance and vicarious liability when the work being performed is of an inherently dangerous nature–the Dillard court cited with approval authorities from other jurisdictions that precluded a contractor's employee claim for injury even when the employee made a claim of liability based on the negligent acts of the landowner. Moreover, the "policy reasons" stated in Dillard would preclude Herrell's claims of negligence against National Beef just as the claims of vicarious liability and peculiar risk were precluded in Dillard. Accordingly, we reverse and remand with directions to the trial court to enter judgment in favor of National Beef.
National Beef contracted with J-A-G Construction Company (J-A-G) to act as a general contractor for the construction of a new roof on its rendering facility in Dodge City. During the roofing project, National Beef continued to operate the rendering facility, where cow intestines, blood, and other nonconsumable meat products (which are called rendering) were known to spill onto and cover the floor of the plant.
As a part of the construction project, large holes–approximately 2 feet deep and 8 to 10 inches in diameter–were excavated in the rendering plant's existing floor for concrete pillars to support the new roof. J-A-G subcontracted with Terracon Consultants, Inc. (Terracon), a consulting engineering company, to test the soil in the holes.
Terracon's employees Shane Harper and Herrell arrived at the rendering facility to conduct the soil tests. After they signed in with National Beef's security at the gate to the plant, a J-A-G foreman took Harper and Herrell through the rendering plant to the site of the holes where they were to obtain soil samples for testing. The holes were surrounded by sandbags.
Harper and Herrell returned to their truck to get the equipment necessary for the soil sampling. As they were walking alone through the rendering plant back toward the job site with their equipment, Herrell stepped off of a small ledge and fell into an unmarked hole that had become covered in rendering, injuring her ankle and knee.
Herrell collected workers compensation benefits from Terracon. Herrell also filed a separate lawsuit against National Beef, generally alleging in her petition that National Beef was "negligent in maintaining a dangerous condition; in failing to warn of the dangerous condition; and in other respects."
National Beef moved for summary judgment, claiming it was not liable because it had no notice of the hole and because it did not control the area where the accident occurred. National Beef also argued that under the rule announced in Dillard v. Strecker, 255 Kan. 704, 877 P.2d 371 (1994), it could not be held liable to Herrell because she had been injured while working on National Beef's premises as an employee of a subcontractor who was covered by workers compensation. In denying summary judgment on this ground, the trial court explained:
"The Court notes that [Dillard] states, 'However, while the liability of the employer is limited, the employee can still bring an action against and recover damages from a negligent third party. K.S.A. 44-504(a) . . .'
"In this instance, [National Beef] was continuing its normal working operations while a construction project was under way. Had [National Beef] vacated the premises and allowed [J-A-G] and its subcontractors exclusive access to and possession of the area under construction, their motion would be well founded.
"However, the facts indicate to this Court that the rendering products that may have filled and obscured the hole that [Herrell] stepped into were there because of the actions of Defendant National Beef. It appears there are comparative fault issues that cannot be determined through a motion for summary judgment."
At trial, National Beef moved for a directed verdict, again arguing that the holding in Dillard dictated that Herrell could recover no more from National Beef than if she were National Beef's own employee, that is, she was limited to recovering workers compensation benefits. The trial judge again concluded that the rule of nonliability of the landowner announced in Dillard was inapplicable, stating:
"This situation is one that I agree with [Herrell's attorney]. The hole itself is not inherently dangerous. Covering the hole with rendering makes it dangerous. The entire operation could have been turned over to [J-A-G]. And, had National Beef left the area, then clearly the cases cited by [National Beef] starting with Dillard vs. Strecker would be applicable. But that's not the case.
"They continued working there. They covered the floor with a substance that it hid dangerous holes in this case. They should have known that under the circumstances they were creating a dangerous situation."
The case was submitted to the jury to determine the comparative fault, if any, of Herrell, National Beef, J-A-G (including its subcontractors), and Terracon. As to National Beef's fault, the trial court instructed the jury as follows:
"The Plaintiff Shelly K. Herrell claims that she sustained injuries and damages due to the fault of the defendant National Beef Packing Company, LLC, in the following respects:
"a. In creating an unreasonably dangerous condition by operating the rendering plant in such a manner to cause rendering to spill on the floor causing holes in the floor to become filled with rendering and hidden from the view of persons walking on the floor;
"b. In maintaining an unreasonably dangerous condition by failing to timely remove the renderings from the floor which resulted in the hole not being visible;
"c. In failing to provide adequate protection and warning from dangerous conditions such as a warning, cone, metal grate, or caution tape, so that people would be warned that the rendering caused holes in the floor to be hidden;
"d. In failing to keep the business place safe;
"f. In removing the metal grate, thereby leaving the hole hidden and exposing people to a risk of falling in a hidden hole;
"g. In failing to inspect the business premises; and
"h. In creating an unreasonably dangerous condition by operating the rendering plant while construction was in progress, causing rendering to spill on the floor and hiding from view potentially dangerous conditions.
"The Plaintiff Shelly K. Herrell further claims that she sustained injuries and damages due to the fault of the defendant National Beef Packing Company, LLC, by not complying with the industry standard set out in OSHA Reg. 1910.23(a)(8) which requires every floor hole into which persons can accidentally walk to be guarded by either: (i) a standard railing with standard toeboard on all exposed sides, or (ii) a floor hole cover of standard strength and construction. While the cover is not in place, the floor hole shall be constantly attended by someone or shall be protected by a removable standard railing."
The jury ultimately returned a verdict assessing fault for Herrell's total damages of $251,197.86 as follows: National Beef–47.5%; J-A-G–32.5%, Terracon–15%; and Herrell–5%.
DOES KANSAS SUPREME COURT PRECEDENT BAR THE EMPLOYEE OF AN INDEPENDENT CONTRACTOR FROM SUING THE LANDOWNER UNDER ANY THEORY OF NEGLIGENCE?
National Beef's sole contention on appeal is that the trial court erred in not concluding, based on the principles and legal reasoning articulated in Dillard, that it was entitled to judgment as a matter of law. National Beef argues that under Dillard, it owed no duty to Herrell because her injuries were covered by workers compensation. As a result, National Beef argues that workers compensation was the exclusive remedy, regardless of the question of negligence. Herrell, on the other hand, counters that National Beef has read too much into Dillard and argues that Dillard was specifically limited to the claims and facts of that case by the court, and the claims and facts in this case are different.
Standard of Review
To establish a claim of negligence against National Beef, Herrell must show the following: National Beef owed her a duty of care; National Beef breached that duty; she suffered injury; and there existed a causal connection between the duty breached and the injury she suffered. See Smith v. Kansas Gas Service Co., 285 Kan. 33, 39, 169 P.3d 1052 (2007).
National Beef contends that the undisputed facts negate the duty element of Herrell's negligence claim against it. Thus, the only issue before this court is the existence of a duty–or, more pointedly, to whom that duty extends–which is a question of law. 285 Kan. at 39. Accordingly, this court has unlimited review of the trial court's conclusion that National Beef owed a duty to Herrell. See South v. McCarter, 280 Kan. 85, 94, 119 P.3d 1 (2005).
Dillard's Limitation of Landowner's Liability to Employee of Independent Contractor
Generally, an occupier of land owes a duty of reasonable care under the circumstances to all entrants on the property who are present with the owner or occupier's consent. See Jones v. Hansen, 254 Kan. 499, 509, 867 P.2d 303 (1994). Part of Herrell's theory of National Beef's liability was that it created, maintained, and failed to warn of the dangerous condition that caused her injuries–the rendering-covered hole. See D.W. v. Bliss, 279 Kan. 726, 740, 112 P.3d 232 (2005) (recognizing the required showing of notice for a claim against a landowner for an injury resulting from a dangerous condition); Restatement (Second) of Torts § 343 (1964) (possessor of land's liability for dangerous conditions known to or discoverable by the possessor).
In Dillard, our Supreme Court determined that the landowner's general duty of reasonable care did not–on the facts and theories of liability advanced by the plaintiffs in that case–extend to an employee of an independent contractor covered by workers compensation insurance. 255 Kan. at 726-27.
Dillard was also a premises liability case involving a construction project. The defendant, a Roman Catholic Archbishop, contracted with A.J. Huber and Sons, Inc. (Huber), for construction work on a church and school. Huber, in turn, subcontracted masonry work for the project with P&S Masonry, Inc. During construction, Lee Dillard, a P&S employee, was seriously injured when a masonry wall collapsed and crushed him. Lee Dillard was covered by workers compensation.
Lee Dillard and other family members sued the Archbishop for negligence based on two theories. First, the Dillards alleged that as the landowner, the Archbishop was directly liable for breaching his nondelegable duty: by violating a provision in the local building code that required the landowner to hire an independent building inspector to monitor the construction of the wall. The Dillards maintained that by breaching that duty, the Archbishop was liable to Lee Dillard for his resulting injuries.
Second, the Dillards alleged that the Archbishop was vicariously liable for the subcontractor's negligence because Lee Dillard was performing an inherently dangerous activity.
The Archbishop argued it owed no duty to Lee Dillard because he was an employee of an independent contractor. The trial court agreed and dismissed the Dillards' petition for failure to state a claim.
On petition for review of this court's decision affirming the trial court, our Supreme Court identified the dispositive issue before it in Dillard as follows:
"[W]hether a landowner who engages an independent contractor, who is covered by workers compensation, may be liable for work-related injuries to employees of the independent contractor under two exceptions to the common-law rule that one who engages an independent contractor is not liable for the negligence of the contractor or the employees. . . . [T]he two exceptions asserted here are direct liability of the landowner for violation of a nondelegable duty imposed by a city ordinance and vicarious liability when the work being performed by the independent contractor is of an inherently dangerous nature." (Emphasis added.) 255 Kan. at 709-10.
The Dillard court then undertook an extensive analysis of the policy considerations and rationale underlying the holdings of a majority of other jurisdictions that the answer to the issue was no–the landowner is not liable under the two exceptions or theories of liability asserted by Lee Dillard. 255 Kan. at 710-25; see Ray v. Schneider, 16 Conn. App. 660, 548 A.2d 461 (1988); Parker v. Neighborhood Theatres, 76 Md. App. 590, 547 A.2d 1080 (1988); Matteuzzi v. The Columbus Partnership, L.P., 866 S.W.2d 128 (Mo. 1993); Zueck v. Oppenheimer Gateway Properties, Inc., 809 S.W.2d 384 (Mo. 1991); Tauscher v. Puget Sound Power & Light Co., 96 Wash. 2d 274, 635 P.2d 426 (1981); Stockwell v. Parker Drilling Co., Inc., 733 P.2d 1029, 1032 (Wyo. 1987). The Dillard court also acknowledged the authorities representing the contrary minority view, but it found that they were inapposite because they failed to address the policy considerations recognized by the other jurisdictions relied upon by the court in arriving at its holding. 255 Kan. at 721-22.
Ultimately, the Dillard court concluded:
"Kansas has clearly recognized the inherently dangerous activity doctrine. However, the fact that the doctrine has been recognized and applied in Kansas is not determinative of the case now before us. None of the Kansas cases we have found addressed the issue of the effect of workers compensation on the applicability of the inherently dangerous activity doctrine under facts similar to the present case. The various policy reasons precluding liability of a landowner for injuries suffered by an employee of an independent contractor covered by workers compensation were not raised or considered in our earlier cases. We find the various policy provisions discussed in the various cases cited herein not only persuasive but also determinative of this case. The policy reasons include:
"(1) The landowner should not have greater liability to an employee of an independent contractor than the liability of the contractor to that employee.
"(2) The landowner should not have greater liability to the employees of an independent contractor than the landowner has to the landowner's own employees.
"(3) Liability on the part of the landowner would encourage the landowner to use the landowner's less experienced employees rather than an experienced contractor.
"(4) Employees of an independent contractor, and their dependents, are protected under the provisions of the workers compensation statutes.
"(5) Workers in inherently dangerous jobs are fully aware of the dangers involved and receive compensation accordingly.
"(6) Landowners may not have expert knowledge of inherently dangerous work, the risks involved, and methods of avoiding such risks that an independent contractor engaged in such activity possesses.
"(7) Liability on the part of the landowner would create a class of employees, those of an independent contractor, with greater rights than the employees of the landowner for doing the same work.
"(8) To allow an employee of an independent contractor covered by workers compensation to invoke the inherently dangerous activity doctrine would (a) reward landowners who, despite their own lack of expertise, choose to perform work negligently resulting in injury to workers, (b) increase the risks to innocent third parties, and (c) punish landowners who seek expert assistance in an effort to avoid liability for injury.
"(9) A landowner who engages the services of an independent contractor pays directly or indirectly for the compensation coverage when the landowner contracts with the independent contractor." Dillard, 255 Kan. at 725-26.
Based on these policies, the Dillard court stated the following:
"(1) A landowner is not liable to an employee of an independent contractor covered by workers compensation for injury sustained as a result of the breach of a nondelegable duty imposed upon the landowner by statute or ordinance.
"(2) The inherently dangerous activity exception to the nonliability of a landowner does not extend to employees of an independent contractor covered by workers compensation.
"(3) Our decision is limited to the facts herein and to those instances where the injured employee of an independent contractor covered by workers compensation seeks to hold a landowner liable under the theories discussed in the opinion." 255 Kan. at 726-27.
Herrell insists that the trial court properly determined that the Dillard holding is factually distinguishable. Moreover, Herrell argues that the Dillard limited holding does not legally bar her negligence cause of action against National Beef. Herrell argues that she did not seek to recover from National Beef under the inherently dangerous activity doctrine or for breach of a nondelegable duty imposed upon the landowner by statute or ordinance: the two theories of landowner liability relied upon in Dillard to which the holding is explicitly limited. Rather, Herrell contends that she sought to recover from National Beef based solely on its own negligence for creating, maintaining, and failing to warn of a dangerous condition, that is, she maintains "the hole in the concrete was hidden because [National Beef] caused the floor to be covered in rendering." In support, Herrell argues that the allegations in Dillard of the Archbishop's direct liability for failing to get an inspection required by city ordinance are "[v]ery different than actually taking an active role in creating a dangerous condition causing an injury" as National Beef allegedly did in this case.
Yet, as National Beef points out, Herrell overlooks the fact that one of the theories she advanced against National Beef's negligence was National Beef's failure to comply with an OSHA regulation governing measures to be taken in guarding floor holes into which persons can accidentally walk. In light of the Dillard holding that a landowner is not liable to an employee of an independent contractor covered by workers compensation for injuries sustained as a result of the breach of a nondelegable duty imposed upon the landowner by statute or ordinance, it is apparent that National Beef cannot be held liable to Herrell for the violation of an OSHA regulation. 255 Kan. 704, Syl. ¶ 3.
Moreover, several other theories of National Beef's liability would have been improper under the Dillard v. Strecker, 255 Kan. 704, 877 P.2d 371 (1994) decision. Specifically, Herrell's submissions to the jury that National Beef was at fault "d. In failing to keep the business place safe," and "g. In failing to inspect the business premises," are questionable. Both theories fall within Dillard's holding that a landowner is not liable to an employee of an independent contractor covered by workers compensation for injury sustained as a result of the breach of a nondelegable duty imposed upon the landowner by statute or ordinance. Those statutes or ordinances are generally enacted and impose duties upon landowners for safety purposes–such as the nondelegable duty of inspections imposed on the landowner by the city building code in Dillard. See 255 Kan. at 706; Restatement (Second) of Torts § 424 (1964) (recognizing as an exception to the general rule of § 409 that an employer of an independent contractor is not liable for physical harm caused to another by act or omission of the contractor or his servants: "One who by statute or by administrative regulation is under a duty to provide specified safeguards or precautions for the safety of others is subject to liability to the others for whose protection the duty is imposed for harm caused by the failure of a contractor employed by him to provide such safeguards or precautions.").
The jury was instructed that it was not required to agree on which specific negligent act or omission caused Herrell's injuries and damages. It is impossible to tell from the jury's general verdict if the percentage of fault it attributed to National Beef was based upon a theory precluded by the Dillard decision. When a jury returns a general verdict and one theory of liability upon which the verdict may have rested was erroneous and when it is impossible to determine whether the jury relied upon the improper ground, the verdict cannot stand. See Franklin v. Northwest Drilling Co., Inc., 215 Kan. 304, 315, 524 P.2d 1194 (1974) ("We state the rule as follows: In the absence of special findings by the jury, when an instruction is given on a theory of a case which is erroneous as a matter of law and the instruction is inclined to lead the jury to attach undue significance to evidence bearing upon another theory properly submitted, a reversal is required in the interest of fairness, even though the jury returned a general verdict. [Citations omitted.]").
Because reversal is required based on at least one of the previously mentioned improper theories, this court must determine if remand for a new trial on any of Herrell's remaining theories of National Beef's negligence for its creation, maintenance, and failure to warn of a dangerous condition is warranted.
Dillard is not as easily distinguishable as Herrell suggests. As National Beef argues in its brief, the public policy considerations underlying the Dillard holding–when read alone–would seem to equally apply to hold National Beef was not liable to Herrell on those theories as well: because she was an employee of an independent contractor covered by workers compensation. Accordingly, the issue becomes as follows: Can a landowner who engages an independent contractor, who is covered by workers compensation, be liable for work-related injuries to employees of the independent contractor for physical harm caused to the employees by a dangerous condition on the land under Restatement (Second) of Torts § 343 (1964)?
National Beef insists that the trial court's interpretation of Dillard runs counter to Dillard's public policy considerations. Specifically, National Beef argues as follows:
"Dillard says nothing about requiring a landowner sued by the employee of a subcontractor to show that the premises were 'deserted' or in the exclusive control of someone else. The Dillard court was concerned about the relationship of the parties in light of the public policies underlying the Kansas workers compensation and workplace laws, not the occupation and control of the area where an accident occurs. As such the trial court's concern over the control of an area where the accident occurred should be disregarded.
". . . Dillard does not draw distinction between activity undertaken by a landowner that may affect the area where the accident occurs and the liability of the landowner. . . . [T]he Dillard case is based on legal relationships among landowners, on the one hand, and contractors, subcontractors, and their employees, on the other hand. It is not based on factual distinctions that relate to the area where an accident may have occurred, such as whether the alleged negligence of the landowner was 'active' or 'passive' in nature."
National Beef further contends that Dillard's holding is a limiting interpretation of K.S.A. 44-504(a). That statute allows an employee, whose exclusive remedy from his or her employer is under the Workers Compensation Act, to bring an action against and recover damages from a third party. See Dillard, 255 Kan. at 709 (recognizing "[t]he bulk of the cases in which recovery against a third party has been allowed [under K.S.A. 44-504(a)] involve factual situations where the alleged negligence of a third party was not directly related to the work being performed by the injured employee, such as automobile accidents, medical malpractice, product liability, and similar actions"). According to National Beef, the rule announced in Dillard
"provides us with a definition of the type of 'third party' or 'other person' who can be sued under that statute, clarifying that K.S.A. 44-504(a) is intended to allow suits against unknown and unrelated third parties, not landowners upon whose ground and upon whose behalf (however directly) the injured employee was, by permission, doing his or her work."
National Beef further notes that it could not invoke the "statutory employer" defense under K.S.A. 44-503(a) because building a roof was not an activity it ordinarily performed or was the activity inherent or integral to its meat packing business. Rather, National Beef contracted out the work to J-A-G as an expert. Thus, National Beef argues that it "stands in the same position as the Archbishop in Dillard and must rely on that case."
Finally, National Beef cites this court's recent opinion in Dye v. WMC, Inc., 38 Kan. App. 2d 655, 172 P.3d 49 (2007). Interestingly, Herrell also summarily asserts that Dye supports her position.
In Dye, this court reversed the trial court's dismissal of the plaintiffs' wrongful death petition filed against a hospital for failure to state a claim. 38 Kan. App. 2d at 655-59, 666. One theory of liability advanced by the plaintiffs was that the hospital breached a duty owed to decedents to exercise reasonable care to employ a competent and careful contractor. This theory of liability is another exception to nonliability of the landowner to an independent contractor's employee for injuries caused by the negligence of an independent contractor as recognized in Restatement (Second) of Torts, § 411 (1964). 38 Kan. App. 2d at 662-64. The hospital argued it did not owe the decedents any duty through its contract with their employer.
Given the procedural posture of Dye, this court could not determine from the record what the decedents' employment status was or the exact nature of the relationship between the hospital and the independent contractor (the air ambulance operator). See 38 Kan. App. 2d at 664. Nevertheless, the Dye court identified possible scenarios dependent upon the decedents' employment status that could present themselves on remand and require a finding of no duty on the hospital's part.
In particular, citing Dillard, the Dye court determined that the employment status could involve the first impr