Alta Refrigeration v. Americold Logistics

• Decision Date: 17 December 2009
• Docket Number: No. A09A2369.,No. A09A2368.,A09A2368.,A09A2369.
• Citation: 301 Ga. App. 738,688 S.E.2d 658
• Parties: ALTA REFRIGERATION, INC. v. AMERICOLD LOGISTICS, LLC. AmeriCold Logistics, LLC v. Alta Refrigeration, Inc.
• Court: Georgia Court of Appeals

688 S.E.2d 658

301 Ga. App. 738

ALTA REFRIGERATION, INC. v. AMERICOLD LOGISTICS, LLC.

AmeriCold Logistics, LLC v. Alta Refrigeration, Inc.

No. A09A2368.

No. A09A2369.

Court of Appeals of Georgia.

December 17, 2009.

Mozley, Finlayson & Loggins, Wayne D. Taylor, Lawrence B. Domenico, Atlanta, for appellant.

Lacy & Snyder, William T. Lacy, Jr., Peachtree City, for appellee.

BLACKBURN, Presiding Judge.

This case arises out of an explosion and fire at a cold storage warehouse facility owned and operated by AmeriCold Logistics, LLC ("AmeriCold"). The explosion and fire, in turn, resulted from an accident that occurred as two employees of Alta Refrigeration, Inc. ("Alta"), assisted by an AmeriCold employee, attempted to reinstall a compressor engine in one of the engine rooms at the warehouse. The accident caused damages in excess of $17 million, and AmeriCold subsequently initiated the current litigation against Alta, asserting claims for breach of contract and negligence.

In Case No. A09A2368, Alta appeals from two separate orders of the trial court. In the first of these orders, the trial court granted summary judgment in favor of AmeriCold on the issue of liability, finding that under the borrowed servant doctrine, Alta was liable for any negligence of the AmeriCold employee involved in the accident. That order also denied Alta's cross-motion for summary judgment, which sought a judgment that the AmeriCold employee involved in the accident was not a borrowed servant of Alta. The second order denied Alta's motion to add AmeriCold's insurers as party-plaintiffs.

In Case No. A09A2369, AmeriCold cross-appeals from the trial court's order granting Alta's motion to compel production of an accident report, written following an investigation by AmeriCold personnel. AmeriCold argues that this report was prepared in anticipation of litigation and therefore constitutes privileged work-product.

Finding that there was no evidence to support the trial court's legal conclusion that the AmeriCold employee participating in the installation did so as a borrowed servant of Alta, we reverse the trial court's order granting summary judgment to AmeriCold on the issue of liability. We further find that, in light of this evidence, Alta is entitled to judgment as a matter of law holding that the AmeriCold employee was not acting as a borrowed servant of Alta at the time of the accident. We affirm, however, the trial Court's order denying Alta's motion to add AmeriCold's insurers to the lawsuit as party-plaintiffs, finding that the cause of action belongs to AmeriCold. We also affirm the trial court's order granting Alta's motion to compel discovery, because the trial court correctly concluded that the investigative report at issue was not entitled to work-product protection.

On appeal from a grant of summary judgment, we conduct a de novo review of the evidence to determine if there exists a genuine issue of material fact and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, entitle the movant to judgment as a matter of law.

(Punctuation omitted.) Bone v. The Children's Place.¹

So viewed, the record shows that the warehouse facility at issue used an ammonia refrigeration system to maintain the temperature necessary for cold storage of food products. Although AmeriCold had in-house personnel that performed routine maintenance and repairs on this system, it hired outside contractors to perform major repairs, replacements, and installations. Sometime before August 3, 2004, AmeriCold hired Alta to remove, rebuild, and reinstall one of AmeriCold's existing ammonia compressor engines. On August 3, 2004, two Alta service technicians, Guy Ploeckelman and Greg Ireland, traveled to the warehouse separately to reinstall the remanufactured compressor engine. Upon arriving at the warehouse, Ireland went in and found John Ausmus, who was the lead technician in AmeriCold's refrigeration department and the assistant to the chief engineer at the warehouse. Ausmus told Ireland that Ausmus "would be working with [the Alta technicians] and that [Ausmus] would get a forklift after his break." Ireland then proceeded to the engine room and began preparing the compressor body for the reinstallation of the engine.

Sometime thereafter, Ploeckelman arrived at the warehouse with the compressor engine, having transported it there on a flat bed trailer. Ploeckelman then found Ausmus, who had previously assisted Ploeckelman and Alta personnel with the removal and reinstallation of compressor engines at the warehouse. According to Ausmus, because Alta did not have an A-frame device available to use in moving the engine, the three men "brain stormed" about how to get the engine into the building, and came to the consensus that they "needed a forklift." Ausmus, therefore, went and obtained an AmeriCold forklift, and the Alta technicians loaded the compressor engine onto the same, using straps to hang the engine from the tines of the forklift.

When the compressor engine was loaded, Ausmus drove the forklift into the warehouse, with Ploeckelman and Ireland walking along next to him to make sure he had the necessary clearance. After getting the compressor engine into the building, Ausmus testified that the three men discussed the best way to get the engine into the engine room and lifted up onto the compressor body. They again decided on a forklift and Ausmus obtained at least two more forklifts, which they attempted to use to move the compressor engine into the engine room and to lift it up for placement on the compressor body. When each of these forklifts proved to be too big to fit through the doorway of the engine room, Ploeckelman called the Alta technician who had removed the engine and was told that Alta and AmeriCold had used a forklift that did not have a pallet guard on it.² Ausmus then went and retrieved a small forklift, which he referred to as a dock truck. To move the compressor engine with this forklift, however, required the addition of fork extensions. Ausmus, therefore, obtained fork extensions belonging to AmeriCold and mounted the same on the forklift. Before they loaded it onto the forklift, Ireland looked up the weight of the compressor engine, which was approximately 3,000 pounds, told Ausmus the weight, and asked if the forklift could handle the load. Ausmus assured them that all of the forklifts at the warehouse could carry loads of up to 4,500 pounds. As a precaution, however, after they attached the compressor engine to this forklift, the men performed a "test lift" in the hallway outside the engine room. When the forklift lifted the compressor engine approximately six to seven feet off the ground without incident, the men decided that it was safe to proceed.

Ireland and Ploeckelman then went into the engine room and positioned themselves to guide the compressor engine into place, and Ausmus drove the forklift into the engine room. As he did so, however, the forklift began to tilt forward and the compressor engine slipped and struck a pipe containing pressurized ammonia gas. The pipe ruptured and, because of the escaping gas, the men evacuated the room, Ausmus alerted his supervisor, and AmeriCold evacuated the facility ahead of the ensuing explosion and fire. It was eventually determined that Ausmus had merely assumed that the dock truck was rated for lifting up to 4,500 pounds; it was, in fact, rated only to lift up to 2,900 pounds.

Following the accident, AmeriCold officials in Atlanta asked Bob Keithley, an AmeriCold regional facility services director stationed in Indianapolis, to come to Atlanta and conduct an investigation of the accident. Keithley made a written report detailing his investigation (the "Keithley Report"), and during discovery Alta requested a copy of the same. AmeriCold refused to produce the Keithley Report, asserting that it was protected by the work-product privilege. Alta then filed a motion to compel, and the trial court granted that motion, finding that the Keithley Report "was prepared according to AmeriCold's standard operating procedure [and] was not prepared in anticipation of litigation [or] by or at the direction of AmeriCold's counsel." The day after granting the motion to compel, however, the trial court granted AmeriCold's motion for summary judgment on the issue of liability. Specifically, the trial court found that no part of the accident could be attributed to AmeriCold because, when he assisted in the attempted reinstallation of the compressor engine, Ausmus was acting as a borrowed servant of Alta, rather than as an employee of AmeriCold.

Three different insurers, Travelers Indemnity Company ("Travelers"), Lexington Insurance Company ("Lexington"), and The Hartford Insurance Company ("Hartford"), indemnified AmeriCold for the losses it sustained as a result of the accident, with one insurance adjuster handling all of the claims paid by each insurer. Lexington issued a series of eight checks, totaling $4,294,504.52, to AmeriCold between August 16, 2004 and April 6, 2006; Hartford issued a series of eight checks, totaling $4,294,504.52, to AmeriCold between August 13, 2004 and November 9, 2007; and Travelers issued a series of ten checks, totaling $8,589,009.04, to AmeriCold between August 13, 2004 and December 7, 2007. These periodic payments were made as reconstruction of the warehouse progressed, as customer claims were settled, and as lost profits were determined.

On January 29, 2008, AmeriCold executed three separate loan receipts, one in favor of each of the insurers, for the amount that each insurer had paid to indemnify AmeriCold for the losses sustained in the accident. Each of those loan receipts stated that the insurance payments received by AmeriCold represented "a loan, without interest, repayable only in the event and to the extent of any net recovery [AmeriCold] may make from any person, persons, corporation or corporations, or...