Seattle-First National Bank v. Shoreline Concrete Co. , 91 Wash. 2d 230 ( 1978 )

Hicks, J.

(concurring in part; dissenting in part) — I concur with Part I of the court's opinion. Regarding Part II of the opinion, I do not quarrel with the majority's reason for refusing to consider the issue of contributory fault. Nonetheless, because this case is being remanded for a new trial, I believe it would have been appropriate to discuss contributory fault as a damage-reducing factor in a strict liability claim in order to assist the trial court at the new trial in this area of the law. Cf. Teagle v. Fischer & Porter Co., 89 Wn.2d 149, 570 P.2d 438 (1977). See Daly v. General Motors Corp., 20 Cal. 3d 725, 575 P.2d 1162, 144 Cal. Rptr. 380 (1978).

I do disagree with Part III of the majority opinion insofar as it extends an employer's "immunity" from suit under the Industrial Insurance Act (RCW 51) beyond actions brought by the employees of such employer. The majority characterizes the third-party claims asserted against Batterman by Dico, Shoreline, and Cutler as involving "the scope of an employer's immunity under the Act." The court's opinion sweeps far too broadly. There is no necessity to "hold that under the Act [RCW 51] the courts have no jurisdiction over an action premised upon or necessarily involving this 'immunized' area of tort law." Rather than analyzing third-party actions against an employer in terms of "immunization" under the act, I would examine such claims to ascertain the existence of an independent duty running from the employer to the third party. If there is none, there is no basis for an action against the employer. If there is such a duty to a third party which the employer has breached, nothing in RCW 51.04.010 provides any immunization to the employer from an action by the third party.

Although a few of this court's prior opinions contain broad dicta arguably to the contrary, until today's decision the only area of tort law "immunized" by the act of this court was that involving actions against an employer by its employees, their family or dependents. This limitation was emphasized in Latimer v. Western Mach. Exch., 42 Wn.2d 756, 758, 259 P.2d 623 (1953), wherein the court stated:

The only causes of action which are withdrawn from private controversy . . . are those of workmen. RCW 51.04.010 (cf. Rem. Rev. Stat., § 7673).

An examination of RCW 51.04.010, the statute upon which the employer's claim of immunity must rest, supports such an interpretation:

The state of Washington . . . declares that all phases of the premises are withdrawn from private controversy, and sure and certain relief for workers ... is hereby provided ... to the exclusion of every other remedy, proceeding or compensation . . . and to that end all civil actions and civil causes of action for such personal injuries and all jurisdiction of the courts of the state over such causes are hereby abolished . . .

(Italics mine.)

The majority states: "[w]e have consistently held that when an employer, such as Batterman, pays its industrial insurance premiums pursuant to the Act the employer may no longer be looked to for recourse." To support this statement the majority cites several cases from this court, as well as two decisions of the Court of Appeals. The cases from this court hold only that the employee (family or dependents), may not look to the employer for recourse. These cases do not address the issue of third-party claims against the employer. As was stated in Latimer v. Western Mach. Exch., supra, the act withdraws from private controversy only those causes of action between employer and employee. See also Stertz v. Industrial Ins. Comm'n, 91 Wash. 588, 158 P. 256 (1916); Zenor v. Spokane & I.E. R.R., 109 Wash. 471, 474, 186 P. 849 (1920).

In support of its position that an area of law has been "immunized" by the act, the majority also cites Olch v. Pacific Press & Shear Co., 19 Wn. App. 89, 573 P.2d 1355 (1978), and Montoya v. Greenway Aluminum Co., 10 Wn. App. 630, 519 P.2d 22 (1974). I do not find the analysis of these two cases to be persuasive. I would adopt the reasoning set forth in the dissenting opinion in Olch v. Pacific Press & Shear Co., supra at page 98 (Swanson, J., dissenting). Montoya at page 634 quotes, out of context, a statement originating from Stertz v. Industrial Ins. Comm'n, supra at page 595. That statement, ”[w]hen the employer, for his part, pays his share into this fund, all obligation on his part to anybody is ended", is set forth in context below:

To resume, ours is not an employer's liability act. It is not even an ordinary compensation act. It is an industrial insurance statute. Its administrative body is entitled the industrial insurance commission. All the features of an insurance act are present. Not only are all remedies between master and servant abolished, and, in the words of the statute, all phases of them withdrawn from private controversy, but the employee is no longer to look to the master even for the scheduled and mandatory compensation. He must look only to a fund fed by various employers. When the employer, for his part, pays his share into this fund, all obligation on his part to anybody is ended. . . .

To sum up, our act positively ends the "jurisdiction of the courts," on "all phases" of master and servant liability.

Stertz v. Industrial Ins. Comm'n, supra at 594-95. The statement regarding the scope of an employer's obligation clearly refers only to the employer-employee relationship, not to the relationship between the employer and a third party.

Although the results reached in both Olch and Montoya may be correct, the analysis employed to reach these results was flawed. Similarly, the majority's analysis in the instant case is faulty. A more cogent rule is set forth in 2A A. Larson, Law of Workmen's Compensation § 76.00 (1976), as follows:

When the third party, in a suit by the employee, seeks recovery over against a contributorily negligent employer, contribution is ordinarily denied on the ground that the employer cannot be said to be jointly liable in tort to the employee because of the operation of the exclusive-remedy clause. But if the employer can be said to have breached an independent duty toward the third party, or if there is a basis for finding an implied promise of indemnity, recovery in the form of indemnity may be allowed. The right to indemnity is clear when the obligation springs from a separate contractual relation, such as an employer-tenant's express agreement to hold the third-party landlord harmless, or a bailee's obligation to indemnify a bailor, or a contractor's obligation to perform his work with due care; but the case is much less clear, and has produced a sharp split of opinion, when it rests upon the theory that a "primary" wrongdoer impliedly promises to indemnify a "secondary" wrongdoer.

Rather than creating "immunized" areas of law, not envisioned by the legislature in adopting or amending the workmen's compensation act, this court should focus upon the relationship between the third party and the employer. If an independent duty to the third party is breached by an employer, there is no reason, theoretical or otherwise, to absolve the employer from liability under RCW 51. No quid pro quo exists between the employer and the third party as exists between the employer and its employee. See 2A A. Larson, Law of Workmen's Compensation § 76.52 (1976); Olch v. Pacific Press & Shear Co., supra at 103 (Swanson, J., dissenting).

Rather than refusing to recognize the third-party claims asserted against Batterman because they arose from conduct "immunized" by the act, I would hold that no obligation, contractual or otherwise, existed between the parties upon which to base a cause of action for indemnity. Cf. Davis v. Niagara Mach. Co., 90 Wn.2d 342, 581 P.2d 1344 (1978).

Utter and Brachtenbach, JJ., concur with Hicks, J.