Cowan v. Interdyne Corp.

[Cite as Cowan v. Interdyne Corp., 2013-Ohio-642.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
ALLEN COUNTY
ROSEMARY COWAN, EXECUTOR
OF THE ESTATE OF WINFRED COWAN,
PLAINTIFF-APPELLANT,
-and- CASE NO. 1-12-26
ROSEMARY COWAN,
PLAINTIFF-APPELLANT,
v. OPINION
INTERDYNE CORP., ET AL.,
DEFENDANTS-APPELLEES.
Appeal from Allen County Common Pleas Court
Trial Court No. CV 2012 0163
Judgment Affirmed
Date of Decision: February 25, 2013
APPEARANCES:
Brian J. Vennekotter for Appellant, Rosemary Cowan
William E. Clark for Appellee, Interdyne Corp.
Case No. 1-12-26
PRESTON, P.J.
{¶1} Plaintiffs-appellants, Rosemary Cowan as the Executor of the Estate
of Winfred Cowan, and Rosemary Cowan, filed an appeal of the Allen County
Court of Common Pleas’ judgment granting defendants-appellees, Interdyne
Corporation and the Bureau of Workers’ Compensation, summary judgment.
Appellants argue the trial court erred when it granted appellees’ motion for
summary judgment because the record creates a genuine issue of material fact in
dispute. For the reasons that follow, we affirm.
{¶2} On February 27, 2012, Winfred and Rosemary Cowan filed a
complaint against Interdyne and the BWC alleging that Interdyne had negligently
exposed Winfred to chemicals and materials that caused his restrictive pulmonary
defect.1 (Doc. No. 1). The Cowans sought damages in excess of $25,000 to
recover for Rosemary’s loss of consortium with her husband and Winfred’s
medical expenses. (Id.).
{¶3} The BWC filed its answer on April 9, 2012. (Doc. No. 6). Interdyne
filed its answer on April 30, 2012. (Doc. No. 7).
1
The Cowans included the BWC as a party to this action because, according to the Cowans’ complaint and
the BWC’s answer, the BWC has paid some of Winfred’s medical expenses. (Doc. No. 1); (Doc. No. 6).
Consequently, the Cowans and the BWC assert that the BWC has a right of subrogation in this matter.
(Id.); (Id.).
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{¶4} On April 30, 2012, Interdyne filed a motion for summary judgment.
(Doc. No. 8). Interdyne argued that R.C. 4123.74 grants it immunity from the
Cowans’ claims. (Id.).
{¶5} On May 25, 2012, the Cowans filed their motion in response. (Doc.
No. 10). The Cowans argued Patrick Staffing, a temporary placement agency, was
Winfred’s employer so R.C. 4123.74 did not apply to Interdyne. (Id.).
{¶6} On June 4, 2012, the trial court filed its judgment entry granting
Interdyne summary judgment. (Doc. No. 11). The trial court found that Interdyne
was Winfred’s employer within the meaning of R.C. 4123.74 because it controlled
his day-to-day tasks in the workplace. (Id.).
{¶7} On June 20, 2012, the Cowans filed a notice of appeal.2 (Doc. No.
12). Appellants now raise one assignment of error for our review.
Assignment of Error
The trial court committed a reversible error by granting
summary judgment in favor of Interdyne when there is a
genuine issue of material fact whether the loaned servant
doctrine applied.
{¶8} In their sole assignment of error, appellants argue Winfred was an
employee of Patrick Staffing and not Interdyne. Appellants contend that Winfred
was assigned to work at Interdyne through Patrick Staffing. Appellants argue that
pursuant to Interdyne’s contract with Patrick Staffing, Patrick Staffing retained the
2
Pursuant to App.R. 29(A), this Court substituted Rosemary Cowan, Executor of the Estate of Winfred
Cowan, for Winfred as a party to this action due to Winfred’s recent death.
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right to direct and control Winfred, so Patrick Staffing was Winfred’s sole
employer.
{¶9} We review a decision to grant summary judgment de novo. Doe v.
Shaffer, 90 Ohio St.3d 388, 390 (2000). Summary judgment is proper where there
is no genuine issue of material fact, the moving party is entitled to judgment as a
matter of law, reasonable minds can reach but one conclusion when viewing the
evidence in favor of the non-moving party, and the conclusion is adverse to the
non-moving party. Civ.R. 56(C); State ex rel. Cassels v. Dayton City School Dist.
Bd. of Edn., 69 Ohio St.3d 217, 219 (1994).
{¶10} Material facts are those facts “that might affect the outcome of the
suit under the governing law.” Turner v. Turner, 67 Ohio St.3d 337, 340 (1993),
citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). “Whether a
genuine issue exists is answered by the following inquiry: [d]oes the evidence
present ‘a sufficient disagreement to require submission to a jury’ or is it ‘so one-
sided that one party must prevail as a matter of law[?]’” Turner at 340, citing
Liberty Lobby, Inc., at 251-252.
{¶11} Summary judgment should be granted with caution, resolving all
doubts in favor of the nonmoving party. Osborne v. Lyles, 63 Ohio St.3d 326, 333
(1992). “The purpose of summary judgment is not to try issues of fact, but is
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rather to determine whether triable issues of fact exist.” Lakota Loc. Schools Dist.
Bd. of Edn. v. Brickner, 108 Ohio App.3d 637, 643 (6th Dist.1996).
{¶12} Interdyne argues that it is immune from claims for common law
negligence damages pursuant to R.C. 4123.74. R.C. 4123.74 provides:
Employers who comply with section 4123.35 of the Revised Code
shall not be liable to respond in damages at common law or by
statute for any injury, or occupational disease, or bodily condition,
received or contracted by any employee in the course of or arising
out of his employment, or for any death resulting from such injury,
occupational disease, or bodily condition occurring during the period
covered by such premium so paid into the state insurance fund, or
during the interval the employer is a self-insuring employer, whether
or not such injury, occupational disease, bodily condition, or death is
compensable under this chapter.
Interdyne contends that based on the loaned servant doctrine, it is an employer
within the meaning of R.C. 4123.74 and consequently immune from appellants’
claims.
{¶13} The Supreme Court of Ohio addressed this issue in Daniels v.
MacGregor, 2 Ohio St.2d 89 (1965). In Daniels, the plaintiff was employed by
Manpower, Inc., a company that provided temporary workers to individuals and
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companies. Id. at 89. Manpower sent the plaintiff to work for MacGregor
Company, one of Manpower’s customers, where he was injured while installing a
light fixture. Id. at 89-91.
{¶14} The pleadings, affidavits, a deposition, and a stipulation revealed that
Manpower’s employees received instructions from the customer regarding what
tasks the individual should perform and how to perform those tasks. Id. at 89-90.
Manpower retained the right to hire and discharge its employees, and the right to
determine which employees were assigned to which customers. Id. Manpower
also reserved the right to remove its employees from one customer and place them
with another, even during the course of a work day. Id. at 90.
{¶15} Manpower’s customers paid a fixed hourly rate for the work
performed by Manpower’s employees. Id. The customers did not pay
Manpower’s employees directly; rather, Manpower paid all of the wages, taxes,
and workers’ compensation premiums for its employees. Id.
{¶16} Thus, the issue before the Court was whether MacGregor was the
plaintiff’s employer for the purposes of the immunity provisions of R.C. 4123.74.
The Court determined that MacGregor was the plaintiff’s employer at the time of
the injury, holding that where:
an employer employs an employee with the understanding that the
employee is to be paid only by the employer and at a certain hourly
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rate to work for a customer of the employer and where it is
understood that customer is to have the right to control the manner
or means of performing the work, such employee in doing that work
is an employee of the customer within the meaning of the
Workmen’s Compensation Act; and, where the customer has
complied with the provisions of the Workmen’s Compensation Act,
he will not be liable to respond in damages for any injury received
by such employee in the course of or arising out of that work for
such customer.
Id. at 92.
{¶17} This Court has previously recognized that, “for purposes of workers’
compensation immunity, an employee may have dual employment status.” Below
v. Dollar General Corp., 3d Dist. No. 9-05-08, 2005-Ohio-4752, ¶ 15. Whether a
loaned servant is a customer’s employee depends on who had the right to manage
the manner or means of day-to-day control over the employee, not who was
responsible for administrative human resources matters. Cottrill v. Thermo
Electron North America, LLC, 4th Dist. No. 09CA34, 2010-Ohio-2238, ¶ 24. In
determining who had the right to control the manner or means of doing the work,
this Court has considered several factors including, but not limited to, “who
controls the details and quality of the work; who controls the hours worked; who
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selects the materials, tools, and personnel used; who selects the routes; the length
of employment; the type of business; the method of payment; and any pertinent
agreements or contracts.” Below at ¶ 24, citing Bostic v. Connor, 37 Ohio St.3d
144, 146 (1988).
{¶18} In the present case, the trial court granted summary judgment in
favor of Interdyne based on the pleadings, an affidavit by William Bresson, who is
an operations supervisor with Interdyne, an affidavit by Winfred, and the contract
between Interdyne and Patrick Staffing. (Doc. No. 11). In his affidavit, Bresson
testified that as an operations supervisor, he is familiar with Interdyne’s day-to-
day activities, “as well as its method and manner of supervision, direction, and
control of all regular and leased employees.” (Doc. No. 8). Bresson testified that
Winfred was an Interdyne employee from June 1, 2004 to January 1, 2005, and
was leased from Patrick Staffing from January 19, 2005 to April 16, 2010. (Id.).
Bresson testified that Interdyne was in compliance with all Ohio Workers’
Compensation requirements and that Interdyne acted according to the terms of its
contract with Patrick Staffing. (Id.). Bresson further testified that Interdyne’s
“method and manner of supervision, direction, and control was the same with
respect to Winifred (sic) Cowan as it was with its regular employees.” (Id.).
{¶19} In his affidavit, Winfred testified that he has been employed with
Patrick Staffing from 2004 or 2005 through 2010, and that he was assigned to
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work for Interdyne during that time. (Doc. No. 10). Winfred testified that he
applied for the position through Patrick Staffing, that Patrick Staffing provided
him with his paycheck, took out his taxes, and notified him that he was no longer
assigned to Interdyne. (Id.).
{¶20} The contract between Interdyne and Patrick Staffing details their
respective rights and responsibilities. (Doc. No. 8). Section 7 of the contract is
titled “Administration/Management” and provides that Patrick Staffing “is
responsible for employment matters such as payment for all Federal, State and
local employment taxes.” (Id.). Subsection (j) states:
Client agrees that, since it controls the work-site and scheduling and
supervision of Covered Employees, and exercises the day-to-day
direction and control over Covered Employees, Client will
determine, verify and accurately report to [Patrick Staffing]:
(i) The total number of hours worked by all Covered Employees
and their exempt and non-exempt status; and
(ii) The total remuneration due each Covered Employee for every
payroll * * *.
(Id.). Section 9 of the contract is titled “Covered Employee On-Site Supervision.”
(Id.). The provision states:
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Client will designate on-site Supervisors. These on-site Supervisors
shall determine and be responsible for all procedures to be followed
by employees regarding the time, manner and performance of their
duties. If determined to be necessary, [Patrick Staffing] reserves the
right of direction and control over management of safety and hazard
control affecting its Employees, including: responsibility for
performing inspections of client equipment and premises; the
promulgation of safety policies; and the management of workers
compensation claims, claims filing and related procedures.
(Id.).
{¶21} After reviewing the record, we find that the present case is similar to
Daniels. The contract between Interdyne and Patrick Staffing specifically
provides for Interdyne to exercise “day-to-day direction and control” over
Winfred. (Id.). The contract also requires Interdyne to designate supervisors who
would “be responsible for all procedures to be followed by employees regarding
the time, manner and performance of their duties.” (Id.). Thus, it was Interdyne,
and not Patrick Staffing, that exercised day-to-day control over Winfred and
determined how he would perform his tasks.
{¶22} This construction of the contract is supported by the affidavits by
Bresson and Winfred. Bresson testified that Interdyne supervised Winfred like
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any other employee. (Id.). Bresson also testified that Interdyne acted according to
its contract with Patrick Staffing, which required Interdyne to have “day-to-day
direction and control” over Winfred. (Id.). Winfred testified that Patrick Staffing
performed administrative and human resources services related to his employment,
such as providing him with his paycheck, deducting his taxes, and notifying him
when he was no longer assigned to Interdyne. (Doc. No. 10). Notably, Winfred
did not make any statements demonstrating that Patrick Staffing exercised day-to-
day control over his work activities. (Id.).
{¶23} Appellants argue that pursuant to Interdyne’s contract with Patrick
Staffing, Patrick Staffing reserved:
the right of direction and control over management of safety and
hazard control affecting its Employees, including: responsibility for
performing inspections of client equipment and premises; the
promulgation of safety policies; and the management of workers
compensation claims, claims filing and related procedures.
(Doc. No. 8). Appellants contend that since Patrick Staffing reserved the right to
direct and control the management of safety and hazard issues affecting Winfred,
Interdyne did not have the required day-to-day control over Winfred to be his
employer pursuant to R.C. 4123.74. We find this argument unpersuasive. The
contract’s plain language reserves “the right of direction and control over
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management of safety and hazard control,” not the right to control the manner in
which Winfred performs his day-to-day tasks. (Id.). Sections 7(j) and 9 of the
contract allocate those responsibilities to Interdyne. (Id.). Consequently, we
cannot find that Patrick Staffing was Winfred’s employer to the exclusion of
Interdyne as appellants contend.
{¶24} Appellants also argue that the present case is similar to a case from
the Tenth District Court of Appeals, Sellers v. Liebert Corp., 10th Dist. No. 05AP-
1200, 2006-Ohio-4111. In Sellers, the plaintiff was employed by Tailored
Management, a professional employment organization, and assigned to work at
Liebert Corporation. Id. at ¶ 1. The plaintiff was injured while working for
Liebert. Id. The contract between Tailored and Liebert stated, “Tailored retains
all rights of supervision and control of Tailored Associates including, but not
limited to, the hiring and promotion, discipline and discharge, wages and salary
administration, processing of grievances, policing of employee conduct and
appearance, and labor relations.” Id. at ¶ 9. The contract further provided, “[t]he
parties acknowledge and agree that all Tailored Associates shall at all times be
under the supervision and control of Tailored, and shall not be under the direct
control of Client.” Id.
{¶25} The Tenth District determined that the contract clearly provided that
Tailored retained the rights of supervision and control over its employees. Id. at ¶
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10. The Court decided the case was distinguishable from Daniels because in its
contract, Tailored retained these rights to day-to-day control, which had not
occurred in Daniels. Id. at ¶ 16. Consequently, the Tenth District held that the
trial court’s grant of summary judgment in favor of Liebert was inappropriate. Id.
{¶26} The present case is distinguishable from Sellers. Here, Patrick
Staffing did not retain the right to control and supervise its employees. Rather,
Patrick Staffing retained “the right of direction and control over management of
safety and hazard control.” (Doc. No. 8). This control is much more limited than
the control at issue in Sellers. The contract provides ways in which Patrick
Staffing could exercise this right, including “responsibility for performing
inspections of client equipment and premises; the promulgation of safety policies;
and the management of workers compensation claims, claims filing and related
procedures,” none of which involve the day-to-day control over the manner in
which the employees complete their tasks. (Id.). In comparison to this limited
right that Patrick Staffing retained, the contract explicitly states that Interdyne has
day-to-day control over the employees. (Id.). Thus, Sellers does not apply to the
instant case because Patrick Staffing did not reserve the right to day-to-day control
over the employees. Furthermore, appellants have not provided any evidence that
Patrick Staffing ever invoked this contract provision while Winfred worked for
Interdyne.
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{¶27} In their reply brief, appellants argue that they have not had the
opportunity to determine whether Patrick Staffing used this contract provision
because Interdyne filed its motion for summary judgment with its answer.
Appellants contend they have not had a chance to complete discovery, so it is not
possible to determine whether Patrick Staffing ever acted pursuant to this
provision. However, appellants failed to file a motion requesting a continuance to
complete the necessary discovery prior to filing their response to Interdyne’s
motion for summary judgment and failed to present this argument in their
response. (Doc. No. 10). “A party’s failure to raise an issue in response to an
adverse party’s motion for summary judgment waives that issue for purposes of an
appeal.” Pottorf v. Sell, 3d Dist. No. 17-08-30, 2009-Ohio-2819, ¶ 24, citing
Minster Farmers Coop. Exch. Co. v. Meyer, 3d Dist. No. 17-08-31, 2009-Ohio-
1445, ¶ 22. Therefore, this issue is not properly before this Court.
{¶28} Even if appellants presented evidence that Patrick Staffing had
invoked its “right of direction and control over management of safety and hazard
control,” we are not persuaded that they would prevail on this issue. (Doc. No. 8).
The evidence demonstrates that Patrick Staffing paid Winfred with the
understanding that Winfred would be working for Interdyne, and that Interdyne
had the right to control the manner and means in which Winfred performed his
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day-to-day tasks. Consequently, we conclude that Interdyne was Winfred’s
employer for the purposes of the immunity provisions of R.C. 4123.74.
{¶29} The appellants’ assignment of error is, therefore, overruled.
{¶30} Having found no error prejudicial to the appellants herein in the
particulars assigned and argued, we affirm the judgment of the trial court.
Judgment Affirmed
WILLAMOWSKI and ROGERS, J.J., concur.
/jlr
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