Baker v. Wendy's of Montana, Inc.

• Decision Date: 28 August 1984
• Docket Number: No. 84-4,84-4
• Parties: Melodi BAKER and Lorraine Bell, Appellants (Plaintiffs), v. WENDY'S OF MONTANA, INC., a Montana Corporation, doing business in Wyoming; Wendy's International, an Ohio Corporation, and Scott Smith, Appellees (Defendants).
• Court: Wyoming Supreme Court

Page 885

687 P.2d 885

Melodi BAKER and Lorraine Bell, Appellants (Plaintiffs), v. WENDY'S OF MONTANA, INC., a Montana Corporation, doing business in Wyoming; Wendy's International, an Ohio Corporation, and Scott Smith, Appellees (Defendants).

No. 84-4.

Supreme Court of Wyoming.

Aug. 28, 1984.

Stuart S. Healy, Sheridan, for appellants.

Michael K. Davis, Sheridan, and J. Dwaine Roybal of Keefer, Roybal, Hanson, Stacey & Jarussi, Billings, Mont., for appellees.

Before ROONEY, C.J., and THOMAS, ROSE, ^* BROWN and CARDINE, JJ.

ROSE, Justice.

The appeal with which this opinion is concerned was originated in the trial court by appellants Melodi Baker and Lorraine Bell. The relevant portions of the complaint alleged assaults and batteries as well as intentional infliction of emotional distress upon the appellants by Scott Smith, an employee of appellee Wendy's of Montana, Inc. (hereinafter referred to as Wendy's), which company was also the appellants' employer and contributed to the Wyoming worker's compensation fund in their behalf. Wendy's filed a motion for summary judgment, which was granted on the ground that the claim was barred by the Wyoming Worker's Compensation Act, § 27-12-101, et seq., W.S.1977.

FACTS

Lorraine Bell's claim flowing from alleged assaults and batteries recounts three specific incidents: two when Smith allegedly touched her on the breast and one when he is said to have touched her buttocks in an offensive manner. Ms. Bell further alleges that Smith uttered a particularly obscene remark, which she contends was addressed to her, and she also says that he made offensive gestures in her presence. This appellant seeks to recover $23 in medical expenses, $355 in damages for past lost wages, an undetermined amount for future lost wages and $30,000 for emotional and mental injury, which damages, she contends, resulted from these intentional improper acts of Mr. Smith.

Melodi Baker alleges that Smith also offensively touched her buttocks twice. She says that these touchings caused her to have headaches, and she further charges that Smith made sexual advances on at least two occasions. Ms. Baker was especially upset when Smith allegedly gave her an order concerning the obscene interplay that he wanted her to have with the male customers. As a result of these purported improprieties, Ms. Baker seeks to recover $142 damages for past lost wages and $40,000 damages for mental anguish.

In addition, the appellants jointly ask $1,000,000 in punitive damages.

It is urged that the liability of Wendy's arises out of its negligent failure to control Scott Smith's conduct and its negligent approval, ratification and participation in the intentional tortious acts of its managerial agent.

It is the appellants' theory that Wendy's should be held vicariously liable for compensatory and punitive damages for Smith's intentionally tortious conduct resulting in injury to appellants for the reason that the corporation was made aware of these touchings, utterances and other improprieties and did not adequately remedy or monitor the situation. The appellants go on to say that, in these circumstances, the injuries complained of were not covered by the Wyoming Worker's Compensation Act and the contributing employer is not, therefore, immune from suit by its employees.

THE ISSUE AND HOLDING

The principal issue which we must resolve is whether or not the exclusive-remedy provision of the Wyoming Worker's Compensation Act bars the appellants' claims against Wendy's. ¹ We will hold that appellants' damages arise from "injuries" received in the scope of and arising out of their employment and, therefore, their sole remedy is to apply to the worker's compensation fund for such relief as it affords. The contributing employer is therefore immune from the suits which have been lodged by the appellants.

The summary judgments will be affirmed.

BACKGROUND

In 1914, Art. 10, § 4 of the Wyoming Constitution was amended to read as follows:

"No law shall be enacted limiting the amount of damages to be recovered for causing the injury or death of any person. Any contract or agreement with any employee waiving any right to recover damages for causing the death or injury of any employee shall be void. As to all extra hazardous employments the legislature shall provide by law for the accumulation and maintenance of a fund or funds out of which shall be paid compensation as may be fixed by law according to proper classifications to each person injured in such employment or to the dependent families of such as die as the result of such injuries, except in case of injuries due solely to the culpable negligence of the injured employee. Such fund or funds shall be accumulated, paid into the state treasury and maintained in such manner as may be provided by law. The right of each employee to compensation from such fund shall be in lieu of and shall take the place of any and all rights of action against any employer contributing as required by law to such fund in favor of any person or persons by reason of any such injuries or death." (Emphasis added.)

Prior to the 1914 amendment, Art. 10, § 4 consisted of only the first two sentences. The purpose of the amendment, as expressed by Ch. 124, S.L. of Wyoming 1915, was to authorize the establishment of an Industrial Accident Fund--financed by industry and underwritten by the state--from which injured employees and the dependents of deceased employees who were injured or killed in covered employment could recover stipulated sums from the compensation fund without regard to fault, save only those instances where injury or death occurred through the culpability of the worker.

Following the amendment to Art. 10, § 4, the legislature enacted a worker's compensation law which was the legislative embodiment of a compromise between employers and employees who recognized the need for a new system to compensate employees for employment-related injuries without the employee having to rely upon tort concepts. Meyer v. Kendig, Wyo., 641 P.2d 1235, 1237 (1982). See also Barnette v. Doyle, Wyo., 622 P.2d 1349 (1981); Stephenson v. Mitchell, Wyo., 569 P.2d 95 (1977); Zancanelli v. Central Coal & Coke Co., 25 Wyo. 511, 173 P.981 (1918). The statutory trade-off for the employers contributing to the fund on behalf of their employees was the provision which gave the employer immunity from "all other rights and remedies" (§ 27-12-103(a), supra) which the injured employee might theretofore have possessed. In return, the covered employees and their dependent heirs received the benefit of rapid and certain relief for work-related injuries and death in exchange for forgoing their right to bring common-law The nature of the law in question is that of an industrial insurance act. This court originally placed this interpretation upon Wyoming's Worker's Compensation Act in Zancanelli v. Central Coal & Coke Co., supra, and we have consistently reiterated this view. Meyer v. Kendig, supra; Bence v. Pacific Power and Light Company, Wyo., 631 P.2d 13 (1981); Barnette v. Doyle, supra; Markle v. Williamson, Wyo., 518 P.2d 621 (1974). The industrial-insurance concept evolved from the proposition that industrial accidents are a cost of production and should be borne by the industry. Zancanelli v. Central Coal & Coke Co., supra, 173 P. at 989.

actions in tort against their employers who were contributing to their accounts in the worker's compensation fund. Meyer v. Kendig, supra, 641 P.2d at 1238; Mauch v. Stanley Structures, Inc., Wyo., 641 P.2d 1247, 1249 (1982); Zancanelli v. Central Coal & Coke Co., supra, 173 P. at 988.

In Cottonwood Steel Corporation v. Hansen, Wyo., 655 P.2d 1226 (1982), we took time to point out as clearly as we knew how that tort law was not to be considered an ingredient of the worker's compensation formula because, under our statutes, worker's compensation liabilities and obligations are structured within the realm of contract law--it is like industrial insurance. As between the employer and the employee, except where the employee is culpably negligent, worker's compensation in Wyoming is not structured as a tort concept, where duty, breach of duty, injury, proximate cause and damages become the concerns of the litigants and the courts. In Cottonwood, we said:

"The amendment to Art. 10, § 4 of the Wyoming Constitution and subsequent enabling legislation did not contemplate that tort law would hold any office in the Worker's Compensation Act except that the employer could defend against claims of the injured employee on the grounds that he or she was culpably negligent. Soon after the amendment to Art. 10, § 4 of the Wyoming Constitution, this court said that the Wyoming worker's compensation scheme was in the nature of an industrial-accident policy. Zancanelli v. Central Coal & Coke Co., 25 Wyo. 511, 173 P. 981 (1918). See: Hotelling v. Fargo-Western Oil Co., 33 Wyo. 240, 238 P. 542 (1925); In re Byrne, 53 Wyo. 519, 86 P.2d 1095, 1101 (1939); and Fuhs v. Swenson, 58 Wyo. 293, 131 P.2d 333, 337 (1942). See also Markle v. Williamson, supra, where we said:

" 'To say that workmen's compensation in Wyoming is in the nature of insurance is to say it stems from contract. Indeed, the clear implication in Zancanelli v. Central Coal & Coke Co., 25 Wyo. 511, 173 P. 981, 989, is that our Workmen's Compensation Act is in contract and not in tort.' 518 P.2d at 624.

"We have never changed our minds about that proposition. Sometimes we have had trouble keeping tort concepts out of the worker's compensation law, Stephenson v. Mitchell, Wyo., 569 P.2d 95 (1977), and Meyer v. Kendig, supra, but we have never deviated from our adherence to the proposition that the worker's compensation law of this state is in the nature of industrial-accident insurance." 655 P.2d at 1236.

For all the same reasons that an employer may not avoid paying a compensation claim where the worker is injured through his or her own...