Robinson v. Hodgdon Bros., Inc.

Robinson v. Hodgdon Brothers, Inc., No. S110-3-00 Wrcv (Teachout, J., Nov. 17, 2003)
[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the
original. The accuracy of the text and the accompanying data included in the Vermont trial court
opinion database is not guaranteed.]
STATE OF VERMONT
WINDSOR COUNTY, SS.
PAULINE ROBINSON,1 individually and : WINDSOR SUPERIOR COURT
as Representative of the ESTATE OF :
KEITH A. ROBINSON, SR., DECEASED, : DOCKET NO. S110-3-2000 Wrcv
and on behalf of the next of kin, :
Plaintiff :
:
v. :
:
HODGDON BROTHERS, INC., and :
DARCY G. HODGDON, :
Defendants :
DECISION RE:
DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT (filed July 25, 2003)
This is an action under 14 V.S.A. §§ 1491 and 1492 for the wrongful death of Keith A.
Robinson, Sr., which occurred on November 10, 1998, on the premises known as Hodgdon’s
Salvage Yard in Ascutney, Vermont. Attorney Charles L. Powell represents the plaintiff.
Attorney Kaveh S. Shahi represents the defendants.
Defendants have again filed a renewed motion for summary judgment, maintaining that
the action is barred by the exclusive remedy provisions of the workers’ compensation statutes.
Judges Cheever and Cook have denied earlier motions for summary judgment, citing remaining
questions about the extent to which Hodgdon Brothers, Inc. (Hodgdon Brothers) operated as a
separate entity from Quick Fix Truck Parts, Inc. (Quick Fix), which paid Mr. Robinson’s wages
and provided him with workers’ compensation.2 Subsequently the parties have conducted
1
There has been a suggestion of death upon the record, and Lori A. Perron has been appointed as
Successor Administrator of the Estate of Keith A. Robinson, Sr.
2
See Entry Order Re: Defendants’ Motion for Summary Judgment (Cheever, J., 1/12/01)
(allowing more discovery concerning identities, activities, and operations of the two corporations);
Decision Re: Defendants’ Motion for Summary Judgment, reported at 6 Vt.Tr.Ct.Rep. 315 (Cook, J.,
1
further discovery, and the Vermont Supreme Court has issued a new decision clarifying the
circumstances under which an independent entity may qualify as a “statutory employer” within
the meaning of 21 V.S.A. § 601(3) and claim immunity from tort suit under 21 V.S.A. § 622.
See Edson v. State, 2003 VT 32, 14 Vt.L.W. 89 (2003). At a status conference on June 30, 2003,
Judge Cook issued a handwritten entry that “Parties may submit a new MSJ based on Edson
case.”
On November 10, 1998, Keith Robinson Sr. was working at Hodgdon’s Salvage Yard
under the direction of Darcy Hodgdon. Quick Fix and Hodgdon Brothers were two separate
corporations that both employed workers at the Salvage Yard. Darcy G. Hodgdon was the sole
shareholder and president of both corporations, and controlled all operations. All employees of
both corporations reported to Mr. Hodgdon; he had the authority to hire and fire, to determine
salaries or other benefits, or to take disciplinary action if necessary. He did and continues to
issue work orders. Mr. Robinson, like most of the workers, was an employee of Quick Fix.
As Judge Cook noted in his Decision dated February 15, 2002, there are some differences
between Hodgdon Brothers and Quick Fix. Mr. Hodgdon and Hodgdon Brothers have operated
the salvage yard for many years, whereas Quick Fix was incorporated only in 1995. It was
formed to provide Hodgdon Brothers employees with workers’ compensation insurance after a
dispute between Darcy Hodgdon and Hodgdon Brothers’ previous workers’ compensation
carrier. As such, it was organized to fulfill Hodgdon Brother’s obligation to provide its
employees with workers’ compensation benefits. Generally Quick Fix handles the payroll for
most employees, but some employees have been paid by Hodgdon Brothers and not Quick Fix.
Quick Fix carried workers’ compensation insurance at the time of the accident, whereas
Hodgdon Brothers did not. Funds were transferred from Hodgdon Brothers to Quick Fix from
which Quick Fix met its payroll.
Plaintiff points out differences between the two corporations in her Answer to
Defendant’s Motion (filed August 25, 2003). Quick Fix was responsible for control of laborers
and cutters, but it did not own, purchase or sell barrels or other salvage, as Hodgdon Brothers
did. Hodgdon Brothers set the salvage pricing and transacted all the salvage sales. Hodgdon
Brothers received payments from salvage customers and maintained salvage customer lists,
whereas Quick Fix did not. Id. at 4-5. (Defendants’ Motion at 11). While it is undisputed that
these differences exist, the question is whether the defendants operated separately from Quick
Fix such that Hodgdon Brothers does not have “statutory employer” immunity from third party
suit, or whether one or both of them had a non-employment related duty to Mr. Robinson which
was breached, causing the accident.
2/15/02) (based on record, court was unable to conclude that Quick Fix and Hodgdon Brothers were
essentially the same entity for workers’ compensation purposes); Entry Regarding: Defendants’ Motion
for Reconsideration (Cook, J., 3/28/02) (disputed facts concerning the extent to which Hodgdon Brothers
operated as a separate entity from Quick Fix); Decision Regarding: Defendants’ Renewed Motion for
Summary Judgment (Cook, J., 1/21/03) (still facts in dispute concerning the extent to which Hodgdon
Brothers operated as a separate entity from Quick Fix).
2
Summary judgment is appropriate if there are no material facts in dispute, and if any
party is entitled to a judgment as a matter of law. V.R.C.P. 56(c)(3). Generally, the moving
party has the burden of proof, and the opposing party must be given the benefit of all reasonable
doubts and inferences in determining whether a genuine issue of material fact exists. Price v.
Leland, 149 Vt. 518 (1988). However, “[w]here the moving party does not bear the burden of
persuasion at trial, it may satisfy its burden of production by showing the court that there is an
absence of evidence in the record to support the nonmoving party’s case. . . . The burden then
shifts to the nonmoving party to persuade the court that there is a triable issue of fact.” Boulton
v. CLD Consulting Engineers, 2003 VT 72 ¶ 5, 14 Vt.L.W. 238, 239 (2003) (quoting Ross v.
Times Mirror, Inc., 164 Vt. 13, 18 (1995)).
In earlier decisions on summary judgment, Judge Cook rejected a per se rule that closely
related corporations should all be treated as employers protected by the exclusivity provisions of
the workers’ compensation act. Courts from other states have held that multiple corporations
could raise an affirmative defense that they functioned as one entity. Judge Cook concluded that
plaintiff could pursue tort compensation from Hodgdon Brothers, and from Darcy Hodgdon in
his capacity as an officer of Hodgdon Brothers, “assuming that plaintiff is able to prove
independent acts of negligence.” (Decision Re: Defendants’ Motion for Summary Judgment
(Cook, J., 2/15/02), slip op. at 6, 6 Vt.Tr.Ct.Rep. at 316.) In his most recent substantive decision
on summary judgment, Judge Cook ruled that “there are still disputed facts concerning the extent
to which Hodgdon Brothers, Inc. operated as a separate entity from Quick Fix Truck Parts, Inc.”
(Decision Regarding: Defendants’ Renewed Motion for Summary Judgment (Cook, J., 1/21/03)).
The Statement of Facts submitted with the most recent motion, and Plaintiff’s response, show
that the material facts on this issue, described above, are now undisputed. (Plaintiff’s Opposition
filed August 25, 2003, pp. 3-7.)
A trial judge has discretion to reconsider an earlier denial of summary judgment.
Morrisseau v. Fayette, 164 Vt. 358, 362-64 (1995). The summary judgment procedure is an
integral part of the rules of civil procedure; it functions “to avoid a useless trial.” Id. at 363
(quoting Sykas v. Kearns, 135 Vt. 610, 612 (1978)). Judges generally disfavor attempts to
reopen earlier decisions on summary judgment, but they are free to do so in a proper case. Id. at
364 (citation omitted); Myers v. LaCasse, 2003 VT 86, ¶ ¶ 11-12, 14 Vt. L. W. 252,254 (2003).
Reconsideration is appropriate in this case because of both a further development in the facts,
and a development of the law arising from a recent decision. Judge Cook acknowledged this
development by issuing a handwritten entry that “Parties may submit a new MSJ based on Edson
case.” (See Scheduling/Entry Order dated 6/30/03).
The Vermont Supreme Court issued its decision in Edson v. State, 2003 VT 32, 14
Vt.L.W. 89, on March 28, 2003. The Court affirmed a trial court ruling that an employee of a
trucking firm could not sue the State of Vermont for injuries incurred while he was loading
liquor at the State liquor control warehouse, because the State was a statutory employer under 21
V.S.A. § 601(3). “Section 601(3) defines the word ‘Employer’ to include ‘the owner or lessee of
premises or other person who is virtually the proprietor or operator of the business there carried
on, but who, by reason of there being an independent contractor or for any other reason, is not
3
the direct employer of the workers there employed.’” Edson ¶ 6 (quoting § 601(3)). The section
“creates a statutory relationship of employer and employee, where no such relationship existed at
common law.” Id. (quoting King v. Snide, 144 Vt. 395, 400 (1984)). In affirming the trial court
ruling, the Supreme Court followed a “nature of the business” analysis in addition to the trial
court’s “right to control” approach.3
[T]he critical inquiry in determining whether an employer is a “statutory
employer” under § 601(3) is whether the type of work being carried out by the
independent contractor is the type of work that could have been carried out by the
owner’s employees as part of the regular course of the business. [King at 401].
Put another way, the question is whether the work that the owner contracted for
“is a part of, or process in, the trade, business or occupation of the owner.” Id.
Edson ¶ 7, 14 Vt.L.W. at 90.
The Court also pointed out that whether a defendant is a statutory employer turns on
whether that entity has potential liability for providing workers compensation benefits, whether it
is the entity actually providing them or not. The purpose of § 601(3) is to prevent business
owners from avoiding their workers’ compensation responsibility by hiring independent
contractors or setting up other relationships to carry out what are essential functions or processes
of the business. Under this provision, hiring independent contractors or using other business
entity structures does not eliminate the owner’s duty; the owner still has the obligation to ensure
that its workers are covered. Where the owner has potential liability, it is immune under 21
V.S.A. § 622 from a third party tort claim for injuries falling within the scope of the Workers
Compensation Act.
The Supreme Court further explained its analysis by contrasting two earlier cases. In
Packett v. Moretown Creamery Co., 91 Vt. 97, 99-102 (1917), the owner of a creamery business
was not a statutory employer of an employee injured while working for an independent
contractor hired by the creamery owner to construct a building. On the other hand, in O’Boyle v.
Parker-Young Co., 95 Vt. 58 (1921), a wood products manufacturer was a statutory employer for
an employee of an independent contractor who hauled lumber and loaded it onto railroad cars for
shipment. The “true test” was whether the work being done by the injured employee pertained to
the defendant’s business. Edson ¶ 8 (comparing and contrasting Packett and O’Boyle).
In Edson, the State was a statutory employer because the plaintiff was injured while
engaged in the State’s business of distributing liquor to its local agencies. Id. ¶ 9. It did not
matter that the trucking company provided worker’s compensation benefits to the plaintiff
3
According to a recent decision by the Department of Labor and Industry, the “nature of the
business” test is increasingly preferred over the “right to control” test. Young v. Consolidated Delivery &
Logistics, Opinion No. 06-03 WC (January 16, 2003) (citing 3 Larson’s Worker’s Compensation Law §
60.05[1], [4] (2000)).
4
pursuant to its contract with the State. Id. ¶ 10. “[I]t is the statutory employer’s potential
liability, not its actual payment of worker’s compensation benefits, that makes the employer
immune from an injured employee’s third-party tort suit.” Id. (citation omitted).
In another recent case, a general contractor was “virtually the proprietor or operator of
the business there carried on” and therefore entitled to immunity as a statutory employer. Welch
v. Home Two, Inc., 172 Vt. 632, 634-35 (2001) (quoting 21 V.S.A. § 601(3)). It would frustrate
the policy of the Workers’ Compensation Act to allow an employee with more than one
employer to collect benefits from the first employer and then turn around and sue the second in
negligence. Id. at 635 (citing Candido v. Polymers, Inc., 166 Vt. 15, 18 (1996)).
In this case, all of the workers for both Hodgdon Brothers and Quick Fix were engaged in
the business of operating a single salvage yard. Although the two corporations differed in some
respects, they both performed functions essential to the regular business of the salvage yard,
controlled in a unified manner by Darcy Hodgdon. Viewed in this light, the case resembles
O’Boyle and Edson, in which the loading and trucking was all part of the overall business
operation. This case does not resemble Packett, in which the construction of a building was not
part of the regular business of the creamery.
Mr. Robinson was a cutter injured while cutting metal delivered to the yard by Hodgdon
Brothers. The cut materials were to be sold by Hodgdon Brothers for profit. The cutting,
crushing, and baling of the scrap metal obtained by Hodgdon Brothers, and later sold by it, was
an essential process in the operation of the salvage yard business operated by Hodgdon Brothers.
If it had not been done by Quick Fix employees, paid with funds provided by Hodgdon Brothers,
then employees of Hodgdon Brothers would have had to do it in order to carry out the work of
the business, as they had done before 1995. The fatal accident arose out of and in the course of
Mr. Robinson’s employment at the salvage yard. Compensation was provided through the
workers’ compensation insurance maintained by Quick Fix, but Hodgdon Brothers was
nonetheless a statutory employee, and had the obligation to provide workers compensation
benefits if Quick Fix did not.
The law provides injured workers with a remedy that is both expeditious and determinate
and independent of proof of fault, but it also provides for employers a liability that is “limited
and determinate” and includes immunity from suit under common law theories of tort.
Morrisseau v. Legac, 123 Vt. 70, 76 (1962). Recent cases such as Edson have confirmed that the
immunity extends to other entities qualifying as statutory employers under § 601(3). While
circumstances may give rise to liability in some person other than the employer, the plaintiff
must prove that the defendant does not qualify as statutory employer in order to maintain suit.
After full discovery opportunity, the undisputed facts show that plaintiff is unable to make this
showing.
For plaintiff to maintain a negligence action against either Hodgdon Brothers or Darcy
Hodgdon, she would have to allege and prove “circumstances that reveal a duty that is
‘additional to and different from’ the general, nondelegable duty of the employer [to maintain a
5
safe workplace].” Gerrish v. Savard, 169 Vt. 468, 474 (1999) (quoting Kruse v. Schieve, 213
N.W.2d 64, 66 (Wis. 1973)). Plaintiff’s claims are related to safety in the workplace. She has
not met her burden of showing that Hodgdon Brothers or Mr. Hodgdon had assumed any
additional duties, separate and apart from the general duty of maintaining safety.
As Judge Cook previously concluded, the plaintiff cannot maintain this action against
Darcy Hodgdon based on acts or omissions in his role as a corporate officer of Quick Fix, nor
can she maintain this case against Mr. Hodgdon or Hodgdon Brothers merely because they own
the premises. The undisputed fully developed facts now show that, in addition, both defendants
are protected from tort liability because Hodgdon Brothers qualifies as a statutory employer.
The immunity of a corporate business extends to corporate officers of statutory employers, even
if the officer was personally negligent. “As long as a corporate duty is in issue, immunity exists
whether the officer fails to discharge it or actually does so in a negligent manner.” Garrity v.
Manning, 164 Vt. 507, 513 (1996).
For the reasons set forth above, both defendants are entitled to judgment as a matter of
law.
ORDER
Defendants’ Motion for Summary Judgment (filed July 25, 2003) is GRANTED.
Dated at Woodstock, Vermont this ____ day of _______________, 2003.
__________________________
Hon. Mary Miles Teachout
Presiding Superior Court Judge
6
STATE OF VERMONT
WINDSOR COUNTY, SS.
PAULINE ROBINSON,* individually and : WINDSOR SUPERIOR COURT
as Representative of the ESTATE OF :
KEITH A. ROBINSON, SR., DECEASED, : DOCKET NO. S110-3-2000 Wrcv
and on behalf of the next of kin, :
Plaintiff :
:
v. :
:
HODGDON BROTHERS, INC., and :
DARCY G. HODGDON, :
Defendants :
JUDGMENT
This action came on for consideration of the Motion of Defendants for Summary
Judgment, and the court having granted Defendants’ Motion for Summary Judgment on
November 17, 2003,
It is ORDERED and ADJUDGED that judgment is entered for the Defendants, and
Plaintiffs shall take nothing on the claims.
Dated at Woodstock, Vermont this ____ day of _______________, 2003.
__________________________
Hon. Mary Miles Teachout
Presiding Superior Court Judge
7
* There has been a suggestion of death upon the record, and Lori A. Perron has been appointed
as Successor Administrator of the Estate of Keith A. Robinson, Sr.