Discover Property and Casualty Insurance Co.

IN THE SUPERIOR COURT OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
DISCOVER PROPERTY AND CASUALTY )
INSURANCE COMPANY, Individually and )
a/s/o ACCESS LABOR SERVICE, INC., and )
FRANK LAYNE, JR., ) C.A. No. N12C-10-042 EMD
)
Plaintiff, )
)
v. )
)
GAVILON GRAIN, LLC, d/b/a )
PEAVY COMPANY, LLC )
)
Defendant. )
Submitted: August 3, 2015 1
Decided: August 13, 2015
Upon Consideration of
Plaintiff’s Motion for Application for Certification of Interlocutory Appeal
DENIED
Louis J. Rizzo, Jr., Esquire, Reger Rizzo Darnall LLP, Wilmington, Delaware, Attorney for
Plaintiff Discover Property and Casualty Insurance Company.
Robert G. Devine, Esquire, Michael W. Horner, Esquire, Rochelle L. Gumapac, Esquire, White
and Williams LLP, Wilmington, Delaware, Attorneys for Defendants Gavilon Grain, LLC.
DAVIS, J.
1
The last pleading on this matter was received by the Court on August 3, 2015, but Plaintiff Discover Property and
Casualty Insurance Company (“Discover”) noticed an appeal with the Delaware Supreme Court on August 12, 2015
(the “Supreme Court Appeal”). Under Del. R. S. Ct. Rule 42(c)(iii), this Court needed to act on the certification
request within ten days of the filing of Defendant Gavilon Grain’s response to Discover’s request for certification –
i.e., August 13, 2015. The Supreme Court Appeal, arguably, divested this Court of the power to decide pending
motions relating to the issues on appeal. On August 12, 2015, the Delaware Supreme Court informed Discover that
no further action would be taken until compliance with Del. R. S. Ct. Rule 42(d). Under the circumstances and to
preserve resources, the Court will still issue this decision pending an indication from the Delaware Supreme Court
as to whether or not it will treat the decision as void or voidable due to the pending Supreme Court Appeal.
I. INTRODUCTION AND PROCEDURAL HISTORY
This is a subrogation action brought by Discover, individually and as subrogee for Access
Labor Service, Inc. and Frank Layne, Jr. This matter arises from a November 10, 2011, work
place accident which caused injury to Mr. Layne and Jair “Hector” Cabrera. The accident took
place at a facility operated by Defendant Gavilon Grain LLC (“Gavilon”). Access Labor
Services, Inc. had assigned Mr. Layne as a general laborer to Gavilon’s facility. Several lawsuits
arose from that accident, including the instant action wherein Discover filed a subrogation suit
against Gavilon.
Discover asserts two causes of action against Gavilon – one for breach of contract and
one for negligence. On September 19, 2014, Gavilon filed the Motion for Partial Summary
Judgment of Defendant, Gavilon Grain LLC (the “Gavilon SJ Motion”). Gavilon sought
summary judgment as to the negligence claim only, contending that Discover’s negligence claim
is barred by the exclusive remedy provision of the Workers’ Compensation Act (the “Act”)
because Mr. Layne was Gavilon’s borrowed servant.
On October 9, 2014, Discover filed its Opposition to Defendant Gavilon Group LLC’s
Motion for Partial Summary Judgment (the “Opposition”). On October 31, 2014, Gavilon filed
the Reply Brief of Defendant Gavilon Grain LLC to the Opposition of Plaintiff Discover
Property Casualty Insurance Company to its Motion for Summary Judgment (the “Reply”). The
Court held a hearing on the Gavilon SJ Motion, and the companion cases, on March 16, 2015.
After the hearing, the Court reserved its decision. Subsequently, additional discovery, and
supplemental briefing was submitted to the Court in the companion case, Shawana Layne (f/k/a
Shawana Singleton) as Guardian Ad Litem and Next Friend to Frank Layne, Jr. v. Gavilon
Grain LLC et al., C.A. No. N12C-12-057. The Court refrained from issuing any formal ruling
2
on the pending dispositive motions so that the parties could supplement the record, as discovery
in each case is virtually identical and relevant to the motions heard on March 16, 2015. 2
On July 13, 2015, the Court issued its decision granting the relief sought in the Gavilon
SJ Motion.
On or about July 23, 2015, counsel for Discover filed the Plaintiff’s Motion for
Application for Certification of Interlocutory Appeal (the “Discover Interlocutory Motion”). On
or about August 3, 2015, Gavilon filed the Response of Defendants’ Gavilon Grain LLC and
Hector Cabrera in Opposition to Plaintiff Discover Property and Casualty Insurance Company’s
Request for Certification of Interlocutory Appeal (the “Response”). It also appears that Discover
noted the Supreme Court Appeal on August 12, 2015 prior to the expiration of time under Rule
42(c)(iii) of the Rules of the Supreme Court of the State of Delaware (“Supreme Court Rule
__”). Arguably, this Court lost jurisdiction over the issues on appeal until the Supreme Court
Appeal is resolved; however, the Delaware Supreme Court issued a letter on August 12, 2015,
informing Discover that no further action would be taken until a supplement notice of
interlocutory appeal was filed in compliance with Supreme Court Rule 42(d)(iii). Discover
chose to file a supplement and, therefore, the Supreme Court Appeal remains pending. As stated
in footnote 1 of this decision, the Court is issuing this decision, with the knowledge that the
decision is void or voidable, in order to efficiently advance the proceedings.
For the reasons stated herein, the Discover Interlocutory Motion is DENIED
II. LEGAL STANDARD AND DISCUSSION
Supreme Court Rule 42(b) sets out the standard for certifying an interlocutory appeal.
“No interlocutory appeal will be certified by the trial court or accepted by this Court unless the
2
July 10, 2015, the Court issued its Memorandum Opinion (the “July 10 Memorandum Opinion”) on the motions
filed in Shawana Layne (f/k/a Shawana Singleton) as Guardian Ad Litem and Next Friend to Frank Layne, Jr. v.
Gavilon Grain LLC et al., C.A. No. N12C-12-057.
3
order of the trial court determines a substantial issue, establishes a legal right and meets 1 or
more of the following criteria: . . . .” 3 Therefore, a plaintiff must show that a court’s order: (1)
determined a substantial issue; (2) established a legal right and (3) met at least one of the five
additional criteria listed under Rule 42(b), 4 in order to certify the appeal.
Discover contends that this Court should enter an order certifying an interlocutory appeal
here because the Court’s decision to grant the Gavilon SJ Motion (i) decided a substantial issue
of material importance; (ii) involved a question of law that relates to the application of statute of
this State which has not been, but should be settled by the Delaware Supreme Court; (iii) could
inefficiently expend judicial resources by having certain remaining matters tried on the pending
trial schedule and then a second trial after remand on Discover’s appeal; and (iv) creates public
policy concerns where employers are incentivized to hire temporary employees into situations
for which they are not trained or are otherwise safe.
Gavilon opposes an interlocutory appeal. Gavilon claims that the Court’s decision to
grant the Gavilon SJ Motion (i) properly applied long-standing legal precedent to a statute of this
State; (ii) did not involve any unprecedented or controversial rulings and, instead, utilized legal
tests set out in prior decisions of the Delaware Supreme Court; and (iii) does not create trial
inefficiencies and an interlocutory appeal would derail a trial set to begin on March 7, 2016.
The Court agrees that its order granting the Gavilon SJ Motion on the claim of Discover
3
DEL. R. S. CT. RULE 42
4
The five additional criteria of Supreme Court Rule 42(b) are:
(i) Same as Certified Question. Any of the criteria applicable to proceedings for certification of questions of
law set forth in Rule 41; or
(ii) Controverted Jurisdiction. The interlocutory order has sustained the controverted jurisdiction of the
trial court; or
(iii) Substantial Issue. An order of the trial court has reversed or set aside a prior decision of the court, a
jury, or an administrative agency from which an appeal was taken to the trial court which had determined a
substantial issue and established a legal right, and a review of the interlocutory order may terminate the
litigation, substantially reduce further litigation, or otherwise serve considerations of justice; or
(iv) Prior Judgment Opened. The interlocutory order has vacated or opened a judgment of the trial court; or
(v) Case Dispositive Issue. A review of the interlocutory order may terminate the litigation or may
otherwise serve considerations of justice.
4
against Gavilon determined a substantial issue and established a legal right. The Court’s
determination that Mr. Layne was a special employee of Gavilon meant that a number of claims
against Gavilon and Mr. Cabrera were barred by the exclusive remedy provision of Delaware’s
Workers’ Compensation Act (the “Act”).
Pursuant to Supreme Court Rule 42(b), Discover must also demonstrate that the order
granting the Gavilon SJ Motion meets one or more of the additional criteria set forth at Rule
42(b)(i)-(v). Of those five possible criteria, Discover appears to assert that Rule 42(b)(iii)
applies, arguing that (i) the Court’s decision relates to the application of a statute which has not
been, but should be settled by the Delaware Supreme Court and (ii) an interlocutory appeal will
substantially reduce litigation or otherwise serve consideration of justice.
Here, the Court does not agree with Discover. The Court did not make a decision that
relates to a statute, 19 Del. C. § 2304, that has not been, but should be settled by the Delaware
Supreme Court. The Court relied heavily on Lester C. Newton Trucking Co. v. Neal 5 and Porter
v. Pathfinder Services, Inc. 6 in making its decision to grant the Gavilon SJ Motion. Both of
those cases involve the Delaware Supreme Court settling similar issues to those raised here under
19 Del. C. § 2304. In Lester C. Newtown Trucking Co., the Delaware Supreme Court set out a
four part test that the courts should apply when determining whether a worker is an “employee”
under the Act: (1) who hired the employee; (2) who may discharge the employee; (3) who pays
the employee’s wages; and (4) who has the power to control the conduct of the employee when
he is performing the particular job in question. 7 In Porter, the Delaware Supreme Court
subsequently used this test when determining that the Act barred the negligence claims of an
5
204 A.2d 393 (Del. 1964).
6
683 A.2d 40 (Del. 1996).
7
204 A.2d at 395.
5
employee – hired and paid by a placement agency but working for another temporary employer –
against his temporary employer. 8
The Court also does not find that an interlocutory appeal will substantially reduce
litigation or otherwise serve the consideration of justice. Discover’s remaining claim is one for
breach of contract. A review of this Court’s decision on the Gavilon SJ Motion will not
terminate the litigation against Gavilon. In fact, the Court could try that matter separately and
without much overlap with the negligence claim asserted by Discover against Gavilon. As for
Discover’s remaining contentions, the Court notes that these same public policy concerns should
have been “loosed” upon the workplace when the Delaware Supreme Court rendered its decision
in Porter – a case involving the Act and an employee hired and paid by a placement agency but
working for another temporary employer.
III. CONCLUSION
For the foregoing reasons the Discover Interlocutory Motion is DENIED.
IT IS SO ORDERED.
/s/ Eric M. Davis
Eric M. Davis, Judge
8
683 A.2d at 42.
6