George v. Bowler ( 2015 )

July 28 2015
DA 14-0582
Case Number: DA 14-0582
IN THE SUPREME COURT OF THE STATE OF MONTANA
2015 MT 209ROBERT GEORGE and TINA GEORGE,
Plaintiffs and Appellants,
v.
CURTIS K. BOWLER, JEAN L. BOWLER,
and JOHN DOES 1-5,
Defendants and Appellees.
APPEAL FROM: District Court of the Fourth Judicial District,
In and For the County of Missoula, Cause No. DV 12-629
Honorable John W. Larson, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
James G. Hunt, Jonathan McDonald, Hunt & McDonald Law Firm,
Helena, Montana
For Appellee:
Mark S. Williams, James D. Johnson, Williams Law Firm, P.C., Missoula,
Montana
Submitted on Briefs: April 29, 2015
Decided: July 28, 2015
Filed:
__________________________________________
Clerk
Justice Beth Baker delivered the Opinion of the Court.
¶1 Plaintiffs Robert George and Tina George (the Georges) appeal the Fourth Judicial
District Court’s grant of summary judgment to defendants Curtis Bowler and Jean
Bowler (the Bowlers). The dispositive issue on appeal is:
Did the District Court correctly grant summary judgment to the defendants on the
basis of the Workers’ Compensation Act’s exclusivity provision?
We affirm.
PROCEDURAL AND FACTUAL BACKGROUND
¶2 The Georges filed a complaint against the Bowlers arising from injuries Robert
sustained on the Bowlers’ property. Robert was employed as a warehouse manager for
Carpets Plus, a corporation whose sole shareholder and president is Curtis and whose
secretary and treasurer is Jean. Carpets Plus operates on rented property owned by Curtis
and Jean individually. In 2008, the Bowlers applied for a building permit to construct a
warehouse on their property for use by Carpets Plus. The Bowlers listed “owners” as the
general contractors for the warehouse construction.
¶3 On September 4, 2009, Robert was asked by Curtis to assemble carpet racks in the
uncompleted warehouse. While assembling the racks, Robert fell and sustained injuries.
Robert was on the clock, working for and being paid by Carpets Plus, when he fell.
Robert claimed and received workers’ compensation benefits for his injuries through
Carpets Plus’s compensation insurance.
¶4 On May 30, 2012, Robert filed suit against the Bowlers in their individual
capacities as the property owners and general contractors of the warehouse, alleging that
2
the Bowlers were negligent in supervising and controlling assembly of the carpet racks
and failed to provide a safe place to work in violation of the Montana Occupational
Safety and Health Act, §§ 50-71-201 thru -202, MCA.
¶5 In their answer, the Bowlers pleaded the Workers’ Compensation Act’s (WCA’s)
exclusivity provision, § 39-71-411, MCA, as an affirmative defense. In his deposition,
Curtis testified that he was acting as the president of Carpets Plus when he instructed
Robert to assemble the carpet racks. Curtis further testified that he was acting on behalf
of Carpets Plus for all aspects of the warehouse construction because the warehouse was
solely for use by Carpets Plus.
¶6 After discovery, the Bowlers moved for summary judgment on the basis of the
WCA’s exclusivity provision. The Bowlers argued that as corporate directors they were
co-employees of Robert at Carpets Plus and thus were exempt from suit for Robert’s
workplace injuries.
¶7 The Georges filed a cross-motion for summary judgment, arguing that the Bowlers
as individual property owners and general contractors were separate legal entities from
the Bowlers as corporate officers acting on behalf of Carpets Plus, and thus that the
exclusivity provision did not apply. The Georges pointed to tax returns showing that the
warehouse, including the carpet racks, were depreciated on the Bowlers’ individual tax
returns, rather than on Carpets Plus’s tax return, arguing that this showed that the carpet
racks were built for the benefit of the property owners, not for Carpets Plus.
3
¶8 The District Court granted the Bowlers’ motion for summary judgment and denied
the Georges’ motion. The court held that the Bowlers were acting at all relevant times in
their capacities as corporate officers of Carpets Plus and, thus, were immune from suit
under the WCA’s exclusivity provision. The Georges appeal.
STANDARD OF REVIEW
¶9 We review summary judgment orders de novo. Albert v. City of Billings,
2012 MT 159, ¶ 15, 365 Mont. 454, 282 P.3d 704. Summary judgment is appropriate
when the moving party demonstrates an absence of a genuine issue of material fact and
entitlement to judgment as a matter of law. M. R. Civ. P. 56(c)(3); Albert, ¶ 15. After
the moving party meets its initial burden, the burden shifts to the party opposing
summary judgment to establish with substantial evidence, as opposed to mere denial,
speculation, or conclusory assertions, that a genuine issue of material fact does exist or
that the moving party is not entitled to judgment as a matter of law. Phelps v. Frampton,
2007 MT 263, ¶ 16, 339 Mont. 330, 170 P.3d 474.
DISCUSSION
¶10 Did the District Court correctly grant summary judgment to the defendants on the
basis of the Workers’ Compensation Act’s exclusivity provision?
¶11 The WCA provides the exclusive remedy against an employer or a co-employee
when an employee is injured on the job. Sections 39-71-411 thru -412, MCA. The
exclusivity provision is an affirmative defense, Brown v. Ehlert, 255 Mont. 140, 146,
841 P.2d 510, 514 (1992), timely asserted here by the Bowlers.
4
¶12 The Georges argue that the WCA’s exclusivity provision applies only to the
employer, Carpets Plus, and its employees. They argue that the Bowlers as individual
property owners are separate legal entities from Carpets Plus. While true, the
corporation, Carpets Plus, can act only through its agents. The Bowlers are agents of
Carpets Plus as well as the property owners. The Georges maintain that the case turns on
the fact that the warehouse was under construction at the time of Robert’s injury, and
they seek relief against the Bowlers as the general contractors for the warehouse
construction rather than as corporate officers of Carpets Plus.
¶13 The Bowlers argue that the Georges’ argument already was rejected by this Court
in Herron v. Pack & Co., 217 Mont. 429, 705 P.2d 587 (1985). In Herron, the plaintiff
sued her husband’s employer for wrongful death, alleging that her husband died as a
result of negligent brake maintenance performed by the defendant. The decedent worked
as a truck driver for the defendant, and his heirs had received workers’ compensation
benefits for his death. The defendant argued that § 39-71-411, MCA, precluded the suit.
The plaintiff argued that Montana should adopt the “dual capacity” doctrine embraced by
a minority of states, which allows suit against the employer for negligence committed in
a capacity separate from its capacity as employer. The plaintiff argued that the
defendant’s truck maintenance activities constituted a separate capacity and the defendant
should not be shielded from liability for negligence committed in that capacity. We
rejected the argument, noting that the dual capacity doctrine would “go a long way
toward destroying the exclusive remedy principle.” Herron, 217 Mont. at 431, 705 P.2d
5at 588 (quoting 2A Larson, Workmen’s Compensation Law § 72.81 (1982)). Herron is
not dispositive, however, because the Georges are not arguing that the same entity was
acting in two capacities, but rather that an entity separate from the employer committed
the alleged negligence at issue.
¶14 The District Court held that the Bowlers were acting as co-employees of Robert at
all times relevant to the dispute and, therefore, are covered by the exclusivity provision of
the WCA. In a footnote in their opening brief, the Georges attempt to portray Jean
Bowler as a volunteer—and thus not considered an employee under the WCA—because
she receives no compensation from Carpets Plus. See § 39-71-118(2)(b), MCA.
However, the Georges do not dispute that they conceded that point at oral argument
before the District Court. We conclude that this argument is waived on appeal, as we will
not place the District Court in error for an action to which the appealing party acquiesced.
See Horn v. Bull River Country Store Props., 2012 MT 245, ¶ 25, 366 Mont. 491, 288
P.3d 218.
¶15 Welton v. Lucas, 283 Mont. 202, 940 P.2d 112 (1997), on which the Georges rely,
is not controlling. We held in Welton that an injured plaintiff was not barred by
§ 39-71-411, MCA, from suing the owners of property on which the plaintiff was injured,
even though the owners also were shareholders in the company that employed the
plaintiff. As landlords, the defendants were “strangers to the employment relationship,”
and they still owed a duty to maintain the premises in a safe condition. Welton,
283 Mont. at 206–08, 940 P.2d at 114–15. The Welton complaint alleged that the
6
defendants were negligent by allowing a dangerous condition to remain on their
premises. Welton, 283 Mont. at 204, 940 P.2d at 113. Here, in contrast, the Georges
alleged that the Bowlers “failed to provide and enforce the use of proper safety
equipment and practices on the project.” The alleged negligent acts that caused Robert’s
injuries were just that—acts taken by Curtis while supervising Robert’s work; they had
nothing to do with the condition of the premises. The Georges’ complaint does not
invoke premises liability as the basis for their allegations against the Bowlers.
¶16 The Georges argue nonetheless that the undisputed evidence shows that the
Bowlers were acting in their capacity as the property owners, not as corporate officers of
Carpets Plus, when the carpet racks were being installed in the Bowlers’ warehouse.
Alternatively, the Georges argue that there is a disputed issue of material fact as to
whether the Bowlers were operating as co-employees of Carpets Plus or as the property
owners.
¶17 Though not cited by the parties, on point here is Massey v. Selensky, 212 Mont. 68,
685 P.2d 938 (1984) (Massey I):
It is well settled in Montana that a co-employee is immune from liability
for negligent acts resulting in injuries which are compensable under the
Workers’ Compensation Act. . . . However, the simple fact that two
persons have the same employer would not necessarily cause this rule to
apply. We must therefore determine when a co-worker is an “employee” as
that term is used in Section 39-71-412, MCA, for purposes of applying the
co-employee immunity rule.
. . .
We hold that the proper test is whether the co-worker was acting within the
course and scope of his employment at the time the negligent acts occurred.
If the allegedly negligent co-worker was acting within the course and scope
7
of his employment at the time he engaged in the purported negligent acts,
then he is an “employee of his employer,” and immune from suit by the
injured claimant.
Massey, 212 Mont. at 71–72, 685 P.2d at 940 (internal citations omitted). If the Bowlers
were acting in the course and scope of their employment with Carpets Plus when Robert
was injured by their alleged negligence, then the exclusivity provision applies.
¶18 The Bowlers point to Curtis’s deposition testimony stating that he was solely
responsible for supervising and controlling the carpet rack assembly, and that he was
acting on behalf of Carpets Plus at all times that he was supervising the carpet rack
assembly. They further point to the undisputed fact that Robert was an employee of
Carpets Plus, was being paid by Carpets Plus at all relevant times, and was working at his
place of employment when the injury occurred. This is sufficient to meet their burden for
summary judgment purposes and shift the burden to the Georges to show some disputed
issue of material fact or that the evidence does not demonstrate that the Bowlers are
entitled to judgment as a matter of law.
¶19 The Georges point to evidence that the Bowlers individually were the general
contractors on the warehouse construction on their property and that the carpet racks
were fixtures in the warehouse, which was under construction at the time of the accident.
The Georges argue that the carpet racks were being installed for the benefit of the
property owners as part of the warehouse construction and, thus, that the Bowlers were
necessarily acting as property owners and general contractors when they supervised and
controlled the carpet rack assembly project. The Georges point to the tax returns
8
showing that the carpet racks were treated for tax purposes as part of the warehouse and
depreciated on the Bowlers’ individual tax returns.
¶20 The Georges’ argument fails because it assumes that if the carpet racks were part
of the warehouse and benefitted the property owners, then the assembly of the carpet
racks was necessarily supervised by the Bowlers individually rather than by Carpets Plus.
As noted earlier, however, Carpets Plus rents the warehouse from the Bowlers, and
Robert is the company’s warehouse manager. The carpet racks undisputedly were for use
by Carpets Plus. There likewise is no dispute that Curtis was Robert’s supervisor at
Carpets Plus, that Robert was working for Carpets Plus at the time of his accident, and
that Robert received benefits through the workers’ compensation coverage of Carpets
Plus for his injuries. The Georges offer no substantial evidence to contradict Curtis
Bowler’s testimony that he was acting on behalf of Carpets Plus while supervising the
rack assembly. The Georges have failed to demonstrate a triable issue of fact.
¶21 The Georges also fail to present argument establishing that the Bowlers are not
entitled to judgment as a matter of law. They argue that the property owners are separate
legal entities from Carpets Plus and that third parties are subject to suit under
§ 39-71-412, MCA, and Article II, § 16 of the Montana Constitution. Both of those
propositions are true, except that separate legal entities are not third parties when they are
acting within the course and scope of their employment as co-employees of the plaintiff
at the times the plaintiff alleges they were negligent. Massey, 212 Mont. at 71–72,
685 P.2d at 940. Because the undisputed evidence shows that the Bowlers were acting
9
within the course and scope of their employment for Carpets Plus at the time they were
alleged to have failed to provide a Carpets Plus employee with a safe place to work, they
are protected from suit by the exclusivity provision.
¶22 The Georges raise a second issue regarding the District Court’s denial of their
motion for sanctions against the Bowlers. That ruling was discretionary, Johnson v.
Booth, 2008 MT 155, ¶ 13, 343 Mont. 268, 184 P.3d 289, and—given the resolution of
the summary judgment issue—we decline to disturb the court’s sanction ruling.
CONCLUSION
¶23 The District Court’s judgment in favor of Curtis and Jean Bowler is affirmed.
/S/ BETH BAKER
We concur:
/S/ LAURIE McKINNON
/S/ MICHAEL E WHEAT
/S/ JAMES JEREMIAH SHEA
/S/ JIM RICE
10