Robertson v. Hagood Homes, Inc. ( 2003 )

TYSON, Judge

concurring.

I concur with the result of the majority’s opinion which affirms the opinion and award of the North Carolina Industrial Commission (“Commission”). I agree with the majority’s determination that N.C. Gen. Stat. § 97-19 provides liability to the general contractor when an employee of the subcontractor is injured under these facts. The majority’s discussion and focus on out of state statutes and case law is not germane to the resolution of this case. The language of North Carolina’s statute and case law is sufficient to impose liability on the general contractor unless there is a defense.

N.C. Gen. Stat. § 97-19 provides a defense to the general contractor’s liability. “If the principal contractor, intermediate contractor or subcontractor shall obtain such certificate [verifying workers’ compensation insurance] at the time of subletting such contract to subcontractor, he shall not thereafter be held liable to any employee of such subcontractor for compensation or other benefits under this Article.” N.C. Gen. Stat. § 97-19 (2003). Under the statute, a contractor is entitled to a defense from liability if, “at the time of subletting” the contract covering the job in which the employee was injured, the contractor had obtained a certificate of insurance. If there is one contract with multiple houses, only one certificate covering the period of work need be obtained. However, if there are separate and distinct contracts, the statute requires a new certificate be issued at the time of subletting each contract.

James Kenny, president of Hagood Homes, testified that when he received the certificate of insurance for Precision Homes he had only “one verbal contract with [Precision Homes] at that time for one house.” The certificate of insurance specifically stated that it was provided for Lot 15 Magnolia Greens. Kenny acknowledged that he did not request subsequent certificates of insurance for the later jobs. Eric Schuette, owner of Precision Homes, testified that each house was a separate verbal contract between Precision Homes and Hagood Homes.

The Commission found:

6. Schuette and Hagood Home began working together in March of 1999. At that time, Schuette and Jim Kenny, president of Hagood Homes, entered into a verbal contract for Schuette to frame a house on Lot 15 in the Magnolia Green subdivision. That was the only house contracted for at that time. . . . The certificate [of insurance], provided in discovery, had a notation at the bottom that it was for Lot 15 Magnolia Green, and that the policy was to be effective for the period from March 16, 1999 to March 16, 2000.

7. Schuette completed the house on Lot 15, and then over the next six months entered into separate verbal contracts with Jim Kenny to do four more houses. Each house was a new verbal contract. The evidence is uncontradicted that Jim Kenny did not request a new certificate of insurance at the time each new contract was entered into with Schuette. Had Kenny asked for a certificate of insurance at the time the contract on the house plaintiff was injured at was sublet, Schuette would not have been able to provide one, because his insurance had been canceled. . . .

Neither of these findings of fact are contested and they are binding on appeal. There is competent evidence in the record to support the findings of the Commission that Hagood Homes and Precision Homes entered into separate contracts. Because the contracts were separate and Hagood did not request nor receive a subsequent certificate of insurance at the time of subcontracting the house where plaintiff was injured, Hagood cannot defend under N.C. Gen. Stat. § 97-19 on the grounds that he (1) received a certificate of insurance for the first house and (2) did not receive notice of the cancellation of the insurance.

Hagood Homes does not have a defense under N.C. Gen. Stat. § 97-19 to the imposition of liability for the injury by accident of plaintiff. I vote to affirm the Commission’s order.