Wilcox v. Basehore ( 2017 )

This opinion was filed for record
at 8,00 OJli\ on fib 9121£1{
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SUPREME COURT CLERK
REME COURT OF THE STATE OF WASHINGTON
DEAN WILCOX, )
)
Petitioner, ) No. 92362-1
)
v. ) En Bane
)
STEVE BASEHORE; BARTLETT )
NUCLEAR, INC; BARTLETT ) Filed FEB 0 9 2017
SERVICES, INC.; BARTLETT )
SUPPORT SERVICES, INC., and )
ELR CONSULTING, INC., )
)
Respondents. )
)
WIGGINS, J.-Dean Wilcox fell 50 feet through an open catwalk hatch onto a
concrete floor. Having sustained severe injuries, he sued the on-site safety planner,
Steven Basehore, for negligent planning causing the fall; Wilcox also named the
safety planner's employer, Bartlett Services, Inc. (Bartlett), and an intermediary
company, ELR Consulting, Inc. (ELR), in respondeat superior. Before trial, the court
granted ELR judgment as a matter of law. At trial, the court instructed the jury on the
borrowed servant doctrine, an extension of respondeat superior. Wilcox appealed
both decisions. The Court of Appeals, in a published decision, affirmed. Wilcox v.
Basehore, 189 Wn. App. 63, 356 P.3d 736 (2015).
We also affirm. We hold that the borrowed servant doctrine is properly a
question for the jury where complete control is a disputed fact. Whether the servant
Wilcox v. Basehore eta/., No. 92362-1
is loaned through an intermediary does not preclude application of the doctrine. We
decline to consider the implications of Wilcox's indemnification argument because it
was raised as a jury instruction challenge for the first time on appeal. We further hold
that judgment as a matter of law was properly granted in favor of ELR because no
reasonable jury could find that ELR had a right to control Basehore's conduct.
FACTS
I. Factual History
This case stems from a workplace injury and the dismantling of a nuclear
facility. The United States Department of Energy's (DOE) Hanford site in
southeastern Washington produced nuclear weaponry (specifically plutonium) from
1943 until its closure in 1987. 1 The site itself is vast, covering 586 square miles, and
is further surrounded by the Hanford Reach National Monument-land long used to
buffer the site's toxic emissions. 2 After decades of plutonium production, the toxic
waste clean-up efforts have been similarly substantial: since 1989, thousands of
workers have been involved as facilities are "deactivated, decommissioned,
decontaminated, and demolished." 3
1U.S. DOE, Hanford History, HANFORD SITE (Jul. 25, 2016, 7:36AM), [https://perma.cc/2XHM-
BK54].
2 See Proclamation No. 7319, 3 C.F.R. § 7319 (2001) (establishment of the Hanford Reach
National Monument (Jun. 9, 2000); noting that the Hanford Reach has been "[m]aintained as
a buffer area in a Federal reservation conducting nuclear weapons development and, more
recently, environmental cleanup activities, with limits on development and human use for the
past 50 years").
3 U.S. DOE, Hanford Cleanup, HANFORD SITE (Jul. 25, 2016, 7:36 AM),
[https://perma.cc/5YQ3-8BJC].
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Washington Closure Hanford LLC (WCH) was a "prime contractor" involved in
this cleanup. As demolition work involves many short-term and specialized tasks,
WCH used many temporary workers, acquired through "staff augmentation" partners.
This case specifically concerns the demolition of "Building 336" at the Hanford site.
Wilcox, a millwright, was one of WCH's permanent employees. Basehore, a
professional work control planner, was hired as an independent contractor.
A. Work Control Planning
Work control planners help ensure on-site safety by compiling "work packages."
These work packages guide on-site work procedures by noting the tasks to be done,
detailing their proper sequence, and, critically, identifying potential hazards. 4 Work
packages are developed by teams of workers, specialists, and engineers; 5 the work
control planner then collects information from the entire work team and puts it in a
comprehensive work document.
4 In this case, the process included a "Job Hazard Analysis," identifying dangers and
precautions to be incorporated into the work package.
5 Teams are assembled by a "Responsible Manager"; the team then performs on-the-ground
analysis. This team is led by a "Senior Project Engineer," who in turn may delegate
supervision to a "Project Engineer." The Project Engineer then supervises the work control
planner. To help assess particular risks, "Subject Matter Experts" are consulted on specific
issues, such as engineering, health and safety, or environmental concerns. After the work
package is completed, a "Field Superintendent" ensures that its guidelines are properly
executed. If additional changes are identified in the field, the Responsible Manager makes
any necessary corrections to the work package.
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Here, Basehore was one of approximately six people involved in preparing the
work package for Building 336 and the only person who was not a WCH employee. 6
The person with comprehensive oversight of the work package was a WCH manager.
B. The Subcontractors
Basehore's employer, Bartlett, is a Massachusetts corporation providing short-
term professional and technical staff to federal government contractors. Bartlett
frequently provided WCH with temporary, specialized workers. After confirming
Basehore's suitability and availability, WCH contracted with a third company, ELR,
which in turn procured Basehore's services.
ELR acted as an intermediary between WCH and Bartlett, according to ELR,
"only to trigger" extra federal payments for WCH. ELR qualifies, for purposes of
federal government contracts, as a service-disabled veteran-owned small business.
According to ELR, WCH's contract with the DOE required that three percent of
subcontracting dollars go to service-disabled veteran-owned small businesses, or
else WCH would forgo an additional $9 million payment. ELR received a relatively
small payment in exchange for acting, according to ELR's counsel, as a "conduit." 7
6Basehore's work was directly supervised by a project engineer, a senior project engineer,
and the field superintendent, all of whom were WCH employees. Other workers were also
purportedly consulted, though attendance at on-site meetings is not recorded.
7 WCH paid $89/hour for Basehore's services. ELR passed on $85.58/hour of this to Bartlett.
Thus, ELR's share of the payment was $3.42/hour. Basehore received $58.71/hour from
Bartlett.
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C. Two-Step Contracting
With ELR as an intermediary, the parties then used a two-step contracting
process. Basehore's services were conveyed from Bartlett to ELR by means of one
contract (ELR-Bartlett Contract). Ex. 222 at BSI-1. Then Basehore's services were
conveyed from ELR to WCH by a second contract (WCH-ELR Contract). Ex. 34 at
ELR 000462. By funneling Basehore's services through ELR, WCH counted the
contract in its tally of subcontracts with service-disabled veteran-owned small
businesses. 8
Both contracts characterized Basehore as an independent contractor. Ex. 222
at BSI-1; ex. 34 at ELR 000466. The ELR-Bartlett Contract, while not signed by WCH,
was created "in support of" WCH. Ex. 222 at BSI-1. The contract established a
maximum payment value "for this work from WCH," id., and incorporated by reference
exhibits A ("General Conditions") and B ("Special Conditions") of the WCH-ELR
Contract, id. at BSI-2.
The WCH-ELR Contract includes both general and special conditions, with the
special taking precedence over the general. Ex. 34 at ELR 000466 ("Order of
Precedence"). General condition (GC) 19 is a comprehensive indemnification
provision. /d. at ELR 000470. Most relevant is GC 2, which provided that ELR would
8The superior court judge in this case characterized the two-step arrangement as "just a
phony deal to try to help [WCH] earn 9 million bucks." The judge who wrote the appellate
court decision similarly referred to the contractual arrangement as "a farce." 189 Wn. App. at
68. The validity of this contracting arrangement is not before us, and we thus decline to
comment.
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"maintain[] complete control over its employees and all of its lower-tier suppliers and
subcontractors," which included Basehore. /d. at ELR 000466.
However, the contract's special conditions characterize the situation differently:
special condition (SC) 13 designates Kim Koegler of WCH as the party with "ultimate
authority over the technical aspects" of Basehore's work. 9 /d. at ELR 000486. These
technical aspects included preparation of the work package, which Wilcox alleges was
negligently prepared.
D. The Accident
The parties agree as to the subsequent unfolding of events: On July 1, 2009,
Wilcox was among those working on a catwalk in Building 336, preparing it for
demolition. The work package guiding that day's work was developed by Basehore.
During his inspection of Building 336, Basehore had failed to realize that the catwalk
was accessed via a hatch that lacked protective guard chains. While Wilcox was still
working, some other workers descended; they left the access hatch open with the
expectation that the remaining workers would soon follow. Before Wilcox could also
descend, he and another worker were asked to finish an additional task. While doing
so, Wilcox stepped through the open catwalk hatch, falling 50 feet to the concrete floor
below.
9Bonnie Cole, WCH's subcontract administrator, was assigned to handle the administrative
aspects of Basehore's work. Ex. 34 at ELR 000486.
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Wilcox survived the fall, sustaining serious injuries to his legs and spine. Wilcox
alleges that Basehore's negligent development of the work package and safety
protocols led to his fall and resulting injuries.
II. Procedural History
Wilcox filed suit against Basehore, Bartlett, and ELR for negligence. Wilcox
later voluntarily dismissed Basehore from the suit. The remaining parties filed cross
motions for summary judgment, which were denied. ELR later filed a second motion
for summary judgment, which was also denied. At the close of evidence, ELR brought
a CR 50 motion for judgment as a matter of law, which was granted. The remaining
claims against Bartlett proceeded to trial.
At trial, Wilcox strongly disputed the jury instructions proposed by Bartlett and
ELR. Two instructions in particular, instruction 12 and instruction 13, directed the jury
to consider the "borrowed servant doctrine." These instructions were as follows:
INSTRUCTION NO. 12
[l]f ... the defendant proves that Steve Basehore was a borrowed
servant of Washington Closure Hanford, your verdict should be for the
defendant.
INSTRUCTION NO. 13
Under the borrowed servant doctrine, a worker in the general
employ and pay of one employer may be loaned to another. If an
employer meets its burden of proving by a preponderance of the
evidence that the worker is a "borrowing servant" that employer is not
liable for the worker's negligence.
In order for a person to be a "borrowed servant", the general
employer must surrender, and the borrowing employer must assume,
exclusive supervision and control over the worker. Exclusive control for
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all purposes is not required. Rather, the question is whether the
borrowing employer has exclusive control of the borrowed worker for the
transaction causing injury.
Defendant has the burden of proving borrowed servant by a
preponderance of the evidence.
Pursuant to these instructions, if the jury found that WCH had exclusive control over
Basehore's allegedly negligent actions, then only WCH would be potentially liable. As
a result, Wilcox would be confined to worker's compensation as his sole remedy. 10
The jury found that Basehore was under WCH's exclusive control with respect
to his allegedly negligent conduct. Because the jury concluded that Basehore was a
borrowed servant of WCH, it did not need to consider the remaining issues, including
whether Basehore was negligent, whether the alleged negligence caused Wilcox's
injury, or what damages Wilcox might have incurred. Judge Spanner entered
judgment in favor of Bartlett. Wilcox appealed.
On appeal, Wilcox renewed his arguments that (1) the borrowed servant
doctrine does not apply and (2) the trial court erred in granting ELR's motion for
judgment as a matter of law. In support of his challenge to the borrowed servant
doctrine's application, Wilcox also argued for the first time on appeal that the doctrine
was superseded by ELR's indemnification agreement with WCH.
10 In a claim against one's own employer, Washington workers' compensation system
provides the sole remedy, with the exception of intentional injury by the employer. RCW
51.04.010 (noting that "[t]he common law system governing the remedy of workers against
employers for injuries received in employment is inconsistent with modern industrial
conditions" and "proves to be economically unwise and unfair"). The statute provides "sure
and certain relief for workers, injured in their work, and their families and dependents is
hereby provided regardless of questions of fault and to the exclusion of every other remedy,
proceeding or compensation, except as otherwise provided in this title." /d. (emphasis added).
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In a published decision, the Court of Appeals considered all arguments
presented (including the new indemnification issue) and affirmed the trial court's
decisions (1) submitting the borrowed servant doctrine to the jury and (2) granting
ELR's motion for judgment as a matter of law. Wilcox, 189 Wn. App. 63.
Wilcox then petitioned this court for review, noting that we have not revisited
the borrowed servant doctrine in nearly 30 years. The parties requested clarification
of the scope of the borrowed servant doctrine when the servant is loaned through an
intermediary and when contractual language characterizes the servant as an
independent contractor. The parties also continued to disagree whether WCH's
exclusive control of Basehore was a disputed fact subject to resolution by the jury and
whether the trial court erred in dismissing ELR by a directed verdict.
STANDARD OF REVIEW
A trial court's decision to instruct the jury on a point of law is reviewed de novo.
Kappelman v. Lutz, 167 Wn.2d 1, 6, 217 P.3d 286 (2009). The instructions '"are
sufficient when they allow counsel to argue their theory of the case, are not
misleading, and when read as a whole properly inform the trier of fact of the applicable
law."' Anfinson v. FedEx Ground Package Sys., Inc., 174 Wn.2d 851,860, 281 P.3d
289 (2012) (quoting Bodin v. City of Stanwood, 130 Wn.2d 726, 732, 927 P.2d 240(1996)).
We also afford de novo review to judgments as a matter of law. Anaya Gomez
v. Sauerwein, 180 Wn.2d 610, 616, 331 P.3d 19 (2014). "A directed verdict is
appropriate if, as a matter of law, there is no substantial evidence or reasonable
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inference to sustain a verdict for the nonmoving party." Chaney v. Providence Health
Care, 176 Wn.2d 727, 732, 295 P.3d 728 (2013). Substantial evidence exists '"if it is
sufficient to persuade a fair-minded, rational person of the truth of the declared
premise."' Guijosa v. Wa/-Mart Stores, Inc., 144 Wn.2d 907, 915, 32 P.3d 250 (2001)
(quoting Brown v. Superior Underwriters, 30 Wn. App. 303, 306, 632 P.2d 887 (1980)).
ANALYSIS
The primary issue in this appeal is the applicability of the borrowed servant
doctrine when the servant is loaned through an intermediary. If the doctrine does not
apply in this situation, then the jury instructions in this case were erroneous and the
case must be returned for a new trial. We conclude that the doctrine does apply and
the jury was correctly instructed. We affirm.
I. Whether the Jury Was Properly Instructed To Consider the Borrowed Servant
Doctrine
The borrowed servant defense is a legal fiction that expands the concept of
respondeat superior. Stocker v. Shell Oil Co., 105 Wn.2d 546, 548, 716 P.2d 306(1986). Under respondeat superior, an employer is vicariously liable to third parties
for torts committed by the servant within the scope of employment. RESTATEMENT
(SECOND) OF AGENCY§ 219 (AM. LAW INST. 1958).
An exception exists, however, when a servant's general employer loans the
servant to another, or "special," employer. For those activities over which the special
employer exercises complete control, the special employer also assumes vicarious
liability under the "borrowed servant" doctrine. Maca/e v. Lynch, 110 Wash. 444, 448,
188 P. 517 (1920) ("It is ... well settled law that one who is in the general employ and
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pay of one person may be loaned, or hired, by his employer to another, and when he
undertakes to do the work of the other he becomes the servant of such other, to
perform the particular transaction.").
Yet the borrowed servant doctrine does not require complete and exclusive
control over all aspects of the loaned worker's conduct. Liability arises out of those
particular transactions over which the special employer has exclusive control.
Stocker, 105 Wn.2d at 548 ("If it can be established that the servant had borrowed
servant status at the time of performance of such transaction, the servant's general
employer can escape liability for damage or injuries flowing from the transaction.");
see also RESTATEMENT (SECOND) OF AGENCY§ 227 (A borrowed servant "may become
the [special employer's] servant as to some acts and not as to others.").
Whether the special employer had exclusive control for the relevant transaction
is generally a question of fact for the jury. Davis v. Early Constr. Co., 63 Wn.2d 252,
258-59, 386 P.2d 958 (1963) (finding that "the evidence fail[ed] to establish" that one
party had "exclusive control" and thus finding that the question was properly submitted
to the jury).
A. Where the Worker Is Loaned through an Intermediary
Wilcox argues that the borrowed servant doctrine should not apply in this case
because a two-step loan scenario does not fit a strict definition of the doctrine; he asks
us to avoid any novel applications of the doctrine because it "results in the destruction
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of valuable common-law rights." 11 Wilcox defines the doctrine as: "A loans his servant
to B, under such circumstances that B assumes complete control and direction of the
servant's work." Thus, Wilcox contends, where A loans a servant to B, who further
loans him to C, the borrowed servant doctrine should not apply. This argument fails
to serve either the definition or the purpose of the doctrine.
First, the definition Wilcox describes is artificially narrow. We have repeatedly
described the doctrine not as a mathematical formula, but as a concept by which "one
who is in the general employ and pay of one person may be loaned, or hired, by his
employer to another." Maca/e, 110 Wash. at 448. The "A to B" characterization of the
doctrine is illustrative, not definitive. It is reasonable that employers would generally
loan employees directly to the party who needs them; that this path is common,
however, does not make it necessary. Wilcox asks us to require that servants be
borrowed directly in order to satisfy the borrowed servant doctrine. In so doing, we
would arbitrarily shrink the boundaries of the borrowed servant doctrine, not simply
preserve its scope. 12
11 Here, Wilcox quotes Novenson v. Spokane Culvert & Fabricating Co., 91 Wn.2d 550, 554-
55, 588 P.2d 1174 (1979). Yet this language in Novenson more applicably explains why we
require clear consent when the borrowed servant is also the plaintiff. In Novenson, we
emphasized the potential unfairness to the loaned servant who, having been borrowed, is no
longer able to recover against his own employer. /d. at 554. Thus, the employee's consent
to being loaned should not have been implied and must have been explicitly obtained before
the borrowed servant doctrine could apply. /d. at 553.
12Wilcox emphasizes the monetary motivations for using the two-step structure in this case
as a reason to preclude application of the borrowed servant doctrine. That one party has
used a route in a potentially objectionable fashion, however, is an insufficient reason to find
the route itself improper. Similarly, Wilcox comments that "[t]he doctrine typically has been
applied to situations involving laborers" rather than "highly specialized professional services,"
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Second, Wilcox's emphasis on the conveyance process is inconsistent with the
doctrine's essential purpose. In a borrowed servant doctrine analysis, we consistently
focus on one basic question: Who controls the servant's conduct? See, e.g., Maca/e,
110 Wash. at 448 ("The controlling facts in these cases, and in all others which support
the rule, is that the servant must have been in the exclusive control of the one to whom
he is loaned."). 13 We emphasize control because the very premise of the borrowed
servant doctrine is to hold accountable those who can account for the allegedly
tortious action. Wilcox offers neither authority nor argument for why we should
abruptly reframe our analysis to focus on whether the servant was borrowed directly
from the general employer or borrowed in multiple steps.
It is consistent with both the definition and the purpose of the borrowed servant
doctrine to apply it to situations of "double borrowing"-as in this case, where the
general employer loans a servant to a second party, who loans the servant to a third
party.
yet no principled support is either offered or apparent for enforcing this sort of arbitrary
distinction between manual and professional work.
13 See also McHugh v. King County, 14 Wn.2d 441, 445, 128 P.2d 504 (1942) ("He who
controls the actions and directs the work or action of another is responsible for the acts of the
one to whom the instruction is given."); Christiansen v. McLellan, 74 Wash. 318, 320, 133 P.
434 (1913) ('"The test is whether, in the particular service which [the servant] is engaged to
perform, he continues liable to the direction and control of his master, or becomes subject to
that of the party to whom he is let or hired."' (quoting Coughlan v. Cambridge, 166 Mass. 268,
277, 44 N.E. 218 (1896))); Boe v. Hodgson Graham Co., 103 Wash. 669, 670, 175 P. 310(1918) ("[W]e must look to the evidence in the case to determine who was in fact [the
borrowed boat's] master."); Olson v. Veness, 105 Wash. 599,601, 178 P. 822 (1919) (noting
that "the question of control of operation is the determining factor").
13
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B. Where Exclusive Contrails a Disputed Fact
Wilcox argues that WCH did not have "exclusive control" over Basehore
sufficient to satisfy the borrowed servant test. Whether the special employer has
exclusive control is a question of fact for the jury. Davis, 63 Wn.2d at 259. Here, the
jury was explicitly asked to find whether WCH exercised exclusive control over
Basehore "for the transaction causing injury," and concluded that such control was
established.
Wilcox counters that submission to the jury was precluded because Bartlett
"admitted it never gave up exclusive control over the core of Mr. Basehore's work-
safety." Bartlett acknowledged that it expected Basehore to abide by its own safety
plan "as well as our customers' programs." Bartlett's president further clarified that
"[t]he site's plan is the overriding safety plan to be used while our employees are
there," though Bartlett's plan may be followed if it is more conservative. While Wilcox
concludes that these statements are an admission of Bartlett's ongoing control over
safety matters, they do not foreclose exclusive control by WCH over a given safety-
related activity. Exclusive control is task specific, not topic specific.
Thus, the basic factual dispute remained: Did Bartlett's or WCH's safety plan
govern Basehore's actions in this instance? This is a factual question that was
properly submitted to the jury.
C. Where Contractual Language Characterizes the Worker as an Independent
Contractor
Wilcox further argues that the parties' "contractual agreements trump the
borrowed servant defense," noting that this rule "was established long ago." Here, the
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contracts described Basehore as an independent contractor. An independent
contractor, by definition, is not under the control of the party for whom he works. Afoa
v. Port of Seattle, 176 Wn.2d 460, 476, 296 P.3d 800 (2013). As a result, Wilcox
argues, we must find that the parties' contractual language precludes application of
the borrowed servant defense. This conclusion misstates our case law and conflates
two contract-related issues.
Wilcox mistakenly relies on our holding in Stocker, which specifically addressed
indemnification agreements. 105 Wn.2d 546. Wilcox paraphrases Stocker's holding
as: "When contractual terms are contrary to the borrowed servant defense, those
terms must be given effect over the defense." This oversimplifies Stocker's holding,
as that case solely concerned the impact of indemnification agreements-a discrete
legal issue.
In Stocker, Shell Oil Company made use of temporary workers supplied by a
labor contractor, P.M. Northwest Inc. 105 Wn.2d at 547. Negligence by one of the
loaned laborers led to a fire at Shell's oil refinery, killing two other borrowed workers,
including Ed Stocker. /d. The personal representatives of the slain men sued Shell,
which settled. /d. Shell then sought indemnification from P.M. Northwest pursuant to
an indemnification agreement between the two companies. /d. Noting that
"[i]ndemnity agreements are essentially agreements for contractual contribution," we
concluded that "an express contractual agreement for indemnification must prevail
over the tort defense of 'borrowed servant'." /d. at 549 (emphasis added). Similarly,
the borrowed servant doctrine allocates the cost of liability between the special and
general employers. Wilcox's omission of the indemnification qualification significantly
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overstates Stockers implications. And Wilcox offers no other support for his argument
that contractual descriptions must or should overcome the reality of exclusive control.
Indeed, parties sometimes characterize their loaned workers as "independent
contractors" or "employees" for different purposes, including responsibility for benefits,
taxes, and training. In fact, this reflects the parties' behavior in this case, as Bartlett
retained responsibility for paying, training, and providing other benefits associated
with Basehore's employment. Wilcox offers no reason why we should require a
worker to be treated identically for all purposes; indeed, the borrowed servant doctrine
itself allows that a worker may be a borrowed servant for one task and an independent
contractor for another. RESTATEMENT (SECOND) OF AGENCY§ 227 (A borrowed servant
"may become the [special employer's] servant as to some acts and not as to others.").
Imposing uniform treatment on a given worker would be a novel departure. Wilcox
does not provide any argument or authority for why we should take this step, and we
decline to do so.
D. Contractual Indemnification Issue
On appeal, Wilcox argues that "the parties allocated to ELR liability for any
harm" caused by Basehore in the indemnity provision of the WCH-ELR Contract. Ex.
34 at ELR 000470. Bartlett and ELR object that this issue is precluded because it was
not raised at trial.
Failure to raise an issue before the trial court generally precludes a party from
raising it on appeal. RAP 2.5. While "this rule insulates some errors from review, it
encourages parties to make timely objections, gives the trial judge an opportunity to
address an issue before it becomes an error on appeal, and promotes the important
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policies of economy and finality." State v~ Kalebaugh, 183 Wn.2d 578,583, 355 P.3d
253 (2015).
For objections to jury instructions in particular, an appellate court usually
considers a claimed error only if the appellant raised the specific issue at trial. Galvan
v. Prosser Packers, Inc., 83 Wn.2d 690, 692, 521 P.2d 929 (1974) (noting that
consideration of errors in instructions on appeal "is limited to those issues specifically
raised" at trial); see also Trueax v. Ernst Home Ctr., Inc., 124 Wn.2d 334, 339, 878
P.2d 1208 (1994).
Here, Wilcox failed to mention contractual indemnification in his challenge to
the borrowed servant doctrine jury instructions. All parties acknowledge that Wilcox
vehemently opposed the borrowed servant instructions generally and made multiple
arguments for the doctrine's exclusion. However, as noted above, the implications of
an indemnity agreement is a discrete exception to the borrowed servant doctrine: as
a bargained-for allocation of liability between parties, it trumps allocation by common
law as between those parties. There was no reason for the trial court to know that
arguments concerning general contractual language also raised a specific legal
argument concerning WCH and ELR's indemnification agreement.
As a result, the trial court was inadequately apprised of the points of law in
dispute relating to the indemnification provision. We therefore decline to consider this
issue.
II. Whether ELR Was Entitled to Judgment as a Matter of Law
Wilcox argues that the trial court improperly granted ELR judgment as a matter
of law because a principal-agent relationship existed, giving rise to vicarious liability.
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We extend vicarious liability where a principal "is accountable" for the actions
of an agent. Chi. Title Ins. Co. v. Office of Ins. Comm'r, 178 Wn.2d 120, 143, 309
P.3d 372 (2013). While we consider whether a principal exercised authority, actual
exercise of control is not necessary so long as "the principal had the right to control
the details of the agent's performance." /d. However, "a principal who hires an
independent contractor is not liable for harm resulting from the contractor's work."
Afoa, 176 Wn.2d at 476.
The crucial distinction is the right to control. In considering whether "a
relationship between a superior business party and a subordinate business party" is
a principal-agent relationship or an "independent contractorship[,] ... the most crucial
factor is the right to control the details of the work." Lamer v. Torgerson Corp., 93
Wn.2d 801, 804-05, 613 P.2d 780 (1980). Where there is no right to control, then the
subordinate party is an independent contractor. /d. This distinction "can only be
decided as a matter of law where there are no facts in dispute and the facts are
susceptible of only one interpretation." Graves v. P.J. Taggares Co., 94 Wn.2d 298,
302-03, 616 P.2d 1223 (1980).
Here, the parties agree that ELR did not employ Basehore. As Wilcox notes,
"BSI, ELR and WCH all agreed in writing that Basehore was acting as an independent
contractor." Wilcox further states that "[t]hose writings correctly described the
relationship." 14 In oral argument concerning ELR's directed verdict motion, Wilcox's
14Wilcox reiterates the belief that Basehore was ELR's independent contractor as support for
the assertion that ELR was unable to loan Basehore to WCH.
18
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counsel again agreed that Basehore was ELR's independent contractor.
Nonetheless, Wilcox asserts that a principal-agent relationship existed between ELR
and Basehore, leaving ELR vicariously liable for Basehore's alleged negligence: "ELR
had a right, and an obligation, to control Mr. Basehore or at least ensure his work was
performed in a safe, professional manner."
It is worth emphasizing that Wilcox is arguing for the truth of two mutually
exclusive facts: (1) that Basehore was an independent contractor of ELR and (2) that
ELR had the right to control Basehore's work. This confusion is understandable, as it
is rooted in mutually exclusive provisions of the WCH-ELR Contract, described below.
In reviewing ELR's motion for a directed verdict as a matter of law, the trial court
held that Basehore was not an agent of ELR, granting the motion. During argument,
the court provided two bases for its decision: First, the "mere right [to control] is not
enough without some exercise of it." Second, the parties all agreed that Basehore
was properly deemed an independent contractor and that "a principal is not liable for
the torts of the independent contractors." The Court of Appeals affirmed on the basis
that "ELR had no right to control" Basehore's work. 15 Wilcox, 189 Wn. App. at 95. We
agree.
Significant confusion on this issue arises out of conflicting contractual
provisions in the WCH-ELR Contract. Wilcox relies largely on GC 2, which required
ELR to "maintain[] complete control over its employees and all of its lower-tier
15The Court of Appeals correctly restates our precedent, as we explicitly provide that the right
to control is itself a sufficient basis for an agency relationship; exercise of control is not
required. Chi. Title, 178 Wn.2d at 143.
19
Wilcox v. Basehore eta/., No. 92362-1
suppliers and subcontractors," including Basehore. Ex. 34 at ELR 000466. However,
SC 14 established that Basehore was an independent contractor. /d. at ELR 000486.
SC 13 further provided for comprehensive supervision of Basehore's technical and
administrative duties by WCH employees. 16 /d.
While these general and special conditions appear to conflict, the contract itself
resolves the issue: GC 6 provides that special conditions take precedence over
general conditions. /d. at ELR 000466-67. As a result, GC 2, stating that ELR
exclusively controlled Wilcox, gives way to SC 1, providing that Wilcox was an
independent contractor as to ELR, and to SC 13, stating that Wilcox was subject to
WCH's control. Thus, the contract does not grant ELR any right of control over
Basehore on its own terms.
Were there additional evidence outside the four corners of the contract tending
to establish ELR's right to control Basehore, the alleged principal-agency relationship
might remain a fact question for the jury. However, the only evidence offered is the
contract itself, which is unavailing, and outside evidence only supports the
understanding that ELR lacked control over Basehore entirely: the parties agree that
ELR's role was to provide a "conduit." Thus, even viewing the evidence in the light
16 Wilcox argues that SC 13 "addresses only technical-administrative requirements of the
subcontract, not the technical work safety planning performed by Basehore." This argument
contains its own refutation. Basehore's job, all agree, was to develop a work safety plan.
This is a technical matter, assigned pursuant to a technical services subcontract. Wilcox
himself describes the task as "technical work safety planning." Ex. 34 at ELR 000486. Thus,
it is unclear how Koegler's "ultimate authority" for "technical aspects" of Basehore's work
could not encompass the work safety plan at issue. /d.
20
Wilcox v. Basehore eta/., No. 92362-1
most favorable to Wilcox, "there is no substantial evidence or reasonable inference to
sustain a verdict" in his favor. Chaney, 176 Wn.2d at 732.
We affirm the directed verdict for ELR.
CONCLUSION
We hold that the trial court properly instructed the jury to consider the borrowed
servant doctrine. The doctrine is properly submitted to the jury where complete control
is a disputed fact. Whether the servant is loaned through an intermediary does not
preclude application of the doctrine. We decline to consider Wilcox's indemnification
exception argument as it was raised for the first time on appeal. We further hold that
ELR was properly granted judgment as a matter of law because there is no substantial
evidence that ELR had a right to control Basehore.
Therefore, we affirm the Court of Appeals.
21
Wilcox v. Basehore eta/., No. 92362-1
WE CONCUR.
22