Nicholas Meyer v. McKenzie Electric Coop., Inc. ( 2020 )

United States Court of Appeals
For the Eighth Circuit
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No. 18-3244
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Nicholas Meyer
lllllllllllllllllllllPlaintiff - Appellee
v.
McKenzie Electric Cooperative, Inc.,
lllllllllllllllllllllDefendant - Appellant
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Appeal from United States District Court
for the Northwestern District of North Dakota
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Submitted: November 12, 2019
Filed: January 17, 2020
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Before COLLOTON, WOLLMAN, and BENTON, Circuit Judges.
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WOLLMAN, Circuit Judge.
Nicholas Meyer, an employee of 4T Construction (4T), sued McKenzie Electric
Cooperative, Inc. (McKenzie) under both negligence-based and strict liability law
principles after he was seriously injured while replacing a high voltage transmission
line for the Bear Ben Road Reconductor Project (Project). The district court1 granted
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The Honorable Daniel L. Hovland, then Chief Judge of the United States
District Court for the District of North Dakota.
summary judgment in favor of McKenzie, holding that McKenzie was not liable
because 4T was an independent contractor and because North Dakota has not
recognized the maintenance of high-voltage power lines as an ultra hazardous
activity. We affirm.
McKenzie hired 4T in March 2014 to install, replace, and repair high voltage
transmission lines for the Project, which involved three energized phase conductors
and one neutral conductor. The contract between McKenzie and 4T stated that 4T is
“an independent contractor performing its work to the requirements as set out by
[McKenzie] but without supervision of [McKenzie] or its employees, [4T] agrees to
hold harmless, indemnify, and defend [McKenzie].”
In assigning work to 4T, McKenzie followed its practice of issuing work
orders, which identified the work that the contractor was hired to perform, and
“staking sheets,” which indicated where the work was to be performed and what
electrical equipment was already installed. The work order and staking sheets for the
Project explained that the four conductors were sized at 1/0. The three energized
phase conductors were to be upsized to 4/0, while the neutral conductor was to
remain at 1/0. Steve Lautenschlager, McKenzie’s contractor manager and
journeyman lineman, made periodic inspections to the Project site. 4T’s president,
John Gulley, testified that McKenzie was concerned with the finished product, but
that it neither directed nor instructed 4T on how to complete the Project. 4T’s vice
president, Lance Wood, testified that McKenzie did not supervise or give input to 4T
beyond scheduling work start and completion dates. Jared DeHaven, the journeyman
lineman and 4T’s crew foreman on site the day of Meyer’s accident testified that
while 4T updated McKenzie on work progress, McKenzie did not oversee 4T’s work
or safety program. McKenzie’s CEO, John Skurupey, testified that McKenzie did not
supervise, monitor, or inspect 4T’s work and that it was concerned only with the
finished product. Meyer himself, who was working as an apprentice lineman on the
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Project, testified that he had never met any representative from McKenzie during the
entire time that he was employed by 4T.
While working on the Project, the 4T crew realized that the neutral conductor
was not sized properly and had to be replaced. The crew, including Meyer, discussed
procedures for safely installing a new neutral conductor given that one of the
overhead conductors was energized at the time. Meyer climbed a pole to change out
a neutral wire and suffered an electric shock, resulting in serious burns to his hands,
forearms, and right leg, as well as brain damage. He subsequently underwent the
amputation of his left hand and has experienced chronic pain and permanent
disfigurement.
We review de novo the district court’s grant of summary judgment, viewing the
evidence in the light most favorable to the nonmoving party and drawing all
reasonable inferences in that party’s favor. Bishop v. Glazier, 723 F.3d 957, 960-61
(8th Cir. 2013). Summary judgment is appropriate if the moving party shows that
there is no genuine dispute as to any material fact and the moving party is entitled to
judgment as a matter of law. Fed. R. Civ. P. 56(a). The parties agree that North
Dakota law governs this diversity action, and we are thus bound by the decisions of
the North Dakota Supreme Court. See Captiva Lake Invs., LLC v. Fidelity Nat’l Title
Ins. Co., 883 F.3d 1038, 1046 (8th Cir. 2018) (applying state law in a diversity
action). If the state supreme court has not decided the issue, our role is to predict how
that court would rule. Id.Meyer argues that McKenzie owed him a duty of reasonable care and
negligently caused his injuries. Meyer first contends that the contract between 4T and
McKenzie was ambiguous and incomplete. He argues that the parties “entered into
the Contract without any sincere intent to review, understand, negotiate, and/or
actually abide by its terms.” R. Doc. 50, at 5 (quoting R. Doc. 40, at 6). “[T]he
language of a contract governs its interpretation if the language is clear and explicit
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and does not involve an absurdity.” Rogstad v. Dakota Gasification Co., 623 N.W.2d
382, 386 (N.D. 2001) (citing N.D. Cent. Code. § 9–07–02). The contract states that
4T is an “independent contractor” that performs its work “without supervision” by
McKenzie, which we conclude constitutes a clear and unambiguous statement that 4T
was retained as an independent contractor.
Meyer next argues that McKenzie is liable for his injuries because it retained
actual control over 4T’s work. The North Dakota Supreme Court “has recognized the
general rule that an employer is not liable for acts or omissions of its independent
contractor.” Schlenk v. Nw. Bell Tel. Co., Inc., 329 N.W.2d 605, 608 (N.D. 1983).
It has also recognized the exception to the general rule that “an employer is liable for
an independent contractor’s acts on a job over which it has retained control.” Id. at
612. That is, an employer “who entrusts work to an independent contractor, but who
retains the control of any part of the work.” Id. (quoting Restatement (Second) of
Torts § 414). An employer does not retain control over a project when it “is
concerned primarily only with the finished product.” Id. (citing Lumpkin v. Streifel,
308 N.W.2d 878, 883 (N.D.1981)). The employer is liable for the actions of the
independent contractor “only when the employer retains the right to control the
method, manner, and operative detail of the work.” Iverson v. Bronco Drilling Co.,
667 F. Supp. 2d 1089, 1094-95 (D. N.D. 2009). The North Dakota Supreme Court
has explained that
[I]t is not enough for an employer to retain a general right to inspect the
work progress or receive reports, to make suggestions or
recommendations, or to prescribe alterations or deviations because those
general rights are usually reserved to employers of independent
contractors. Instead, the employer must retain a right of supervision so
the independent contractor is not entirely free to do the work in its own
way.
Pechtl v. Conoco, Inc., 567 N.W.2d 813, 817 (N.D. 1997).
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We conclude that McKenzie did not retain control over 4T’s and Meyer’s
actions. The statements of those with leadership positions within 4T and McKenzie
make clear that McKenzie was concerned only with the final product. Moreover, the
staking sheets and work orders set forth only the location and final outcome of 4T’s
work, rather than prescribing the specific method in which the work was to be done
or further details regarding the manner. Finally, even though Lautenschlager
performed periodic inspections, North Dakota law states that inspecting work does
not create enough supervision to manifest actual control. See id. at 817.
Leaving aside McKenzie’s argument that Meyer failed to preserve the claim
on appeal, Meyer also contends that McKenzie is strictly liable for his injuries, as he
was engaged in an ultra hazardous activity. The North Dakota Supreme Court has
declined to hold a utility company strictly liable for “injuries and damages from
contact with high tension power lines.” Wirth v. Mayrath Indus., Inc., 278 N.W.2d
789, 791 (N.D. 1979). In rejecting the plaintiff’s argument for imposing strict
liability for abnormally dangerous activities as set forth in the Restatement (Second)
of Torts §§ 519 and 520, the Wirth court concluded that the Restatement provisions
were inapplicable because electrical power is necessary and important and does not
present an “abnormal danger[].” Id. at 794. Meyer argues that Wirth is
distinguishable because his case involved the replacement of transmission lines
energized with high-voltage electricity, rather than the mere transmission of high-
voltage electricity as was the case in Wirth. Both maintenance and ownership of
power lines were addressed in Wirth, id. at 791-92, and so we see no reason to read
its holding as inapplicable to the facts of this case.
The judgment is affirmed.
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