Estate of Moulton v. Puopolo, SJC-11357

• Decision Date: 14 March 2014
• Docket Number: SJC-11357
• Parties: ESTATE OF STEPHANIE MOULTON v. Nicholas PUOPOLO & others.
• Court: United States State Supreme Judicial Court of Massachusetts

ESTATE OF STEPHANIE MOULTON
v.
Nicholas PUOPOLO & others. 1

SJC-11357

Supreme Judicial Court of Massachusetts

Middlesex. Nov. 4, 2013
March 14, 2014

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Wrongful Death. Workers' Compensation Act, Action against employer, Identity of employer. Governmental Immunity. Practice, Civil, Wrongful death, Motion to dismiss, Interlocutory appeal, Standing. Corporation, Charitable corporation, Director's liability, Board of directors. Negligence, Wrongful death, Governmental immunity, Employer, Gross negligence. Fiduciary. Attorney General.

CIVIL ACTION commenced in the Superior Court Department on April 15, 2011. A motion to dismiss was heard by Douglas H. Wilkins, J.

The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court.

John D. Frumer for the defendants.

John James Regan (Barry A. Feinstein & Thomas Hodgkins with him) for the plaintiff.

The following submitted briefs for amici curiae:

Robert J. Murphy, Peter C. Kober, & William P. Mekrut for Massachusetts Council of Human Services Providers, Inc., & others.

John J. Barter for Professional Liability Foundation, Ltd.

Carol A. Kelly for Property Casualty Insurers Association of America.

Present: Ireland, C.J., Spina, Cordy, Botsford, Gants, Duffly, & Lenk, JJ.

LENK, J.

At the time of her death on January 20, 2011, twenty-five year old Stephanie Moulton was employed as a residential treatment counsellor at North Suffolk Mental Health Association, Inc. (North Suffolk), a charitable corporation that provides mental health and rehabilitation services. ² While at work at North Suffolk's Revere treatment facility, Moulton was alone with DeShawn James Chappell, one of the facility's residents, when Chappell assaulted Moulton, causing her death. ³

Several months after her death, Moulton's estate brought a wrongful death action, G.L. c. 229, § 2, in the Superior Court against the directors of North Suffolk (director defendants), ⁴ two psychiatric consultants who had been involved in Chappell's admission, ⁵ the Commonwealth, and Chappell. ⁶ Claiming that the defendants' conduct was "willful, wanton, reckless, malicious and constituted gross negligence," the complaint seeks punitive damages, and separately alleges a breach of fiduciary duty by the director defendants. The gravamen of the complaint against the director defendants is that, as a result of admissions and operating policies that they had effectuated, and others that they had failed to effectuate, those who evaluated clients for residential placement were unaware of Chappell's lengthy history of convictions of violent crimes and his mental health history exhibiting a tendency toward violence. Moreover, as a result of such policies, staff at the facility, such as Moulton, were both unaware of Chappell's history and unequipped to deal with individuals having such a history.

The director defendants moved to dismiss the complaint ⁷ chiefly on the grounds that, with respect to the wrongful death action, ⁸ they are immune from suit, as Moulton's employer, under the exclusive remedy provision, G.L. c. 152, § 24, of the Workers' Compensation Act (act) and, with respect to the breach of fiduciary duty claim, they owed Moulton no such duty. ⁹ The director defendants appealed the denial of their motion, and we transferred the case to this court on our own motion.

In addition to determining that the interlocutory appeal is properly before us under the doctrine of present execution, we conclude that the director defendants, acting as Moulton's employer when adopting or failing to adopt the workplace policies at issue, are immune from suit under the exclusive remedy provision of the act for injuries Moulton sustained while acting within the course of her employment. We conclude also that the directors, as Moulton's employer, owed no fiduciary duty to their employee, and any corrective action for an alleged breach of their fiduciary duty to North Suffolk must be sought by the Attorney General. The complaint against the director defendants accordingly must be dismissed.

Discussion. 1. Wrongful death claim. The complaint asserts that the director defendants were "responsible for setting, overseeing and enforcing policies, standards and criteria governing the screening and selection of [clients] for residence, treatment and services at [North Suffolk] facilities" ("the admission policy") and were "responsible for setting, overseeing and enforcing policies, standards and criteria governing the qualifications, staffing and training of [North Suffolk] facilities in light of the conditions, situations and problems posed by its [clients]" ("the operating policy"). The complaint alleges that if the director defendants had allowed or required a proper examination of prospective clients, and provided access to information in the possession of referring agencies indicating prospective clients' criminal histories and previous violent tendencies, Chappell would not have been deemed an appropriate client for admission to North Suffolk's Revere facility. Further, had North Suffolk employees at that facility been given information about clients' violent backgrounds, and had they been provided adequate training, staffing, and equipment for the appropriate handling of clients with violent criminal histories and violent tendencies, Moulton would not have been left alone with Chappell and she accordingly would not have been killed. Allegedly because of their own conflicts of interest, ¹⁰ the director defendants failed to adopt policies that would have appropriately screened and selected clients and adequately provided for workplace safety; the policies they adopted or failed to adopt, due to these conflicts, knowingly increased the risk of harm to employees, clients, and the general public.

The director defendants maintain that they may not be held individually and personally liable in a wrongful death action for injuries sustained by an employee of a charitable corporation in the course of employment where the corporation is not itself liable due to the exclusive remedy provision of the act. Here, North Suffolk is not liable because the wrongful death statute yields to the exclusive remedy provision of the act. See G.L. c. 229, § 2. Otherwise put, in cases in which an employee sues an employer for wrongful death damages, the provisions of that statute preclude "any civil action for wrongful death of an employee who is subject to the provisions of the workers' compensation laws." Peerless Ins. Co. v. Hartford Ins. Co., 48 Mass.App.Ct. 551, 554 (2000). Maintaining both that Moulton is an employee subject to the provisions of the act and that the term "employer" encompasses not only North Suffolk, but the director defendants as well, the latter assert that they are as a matter of law immune from this wrongful death action.

a. Statutory scheme. Compensation under the act is the exclusive remedy for injuries to an employee suffered in the course of employment, regardless of the wrongfulness of the employer's conduct, Foley v. Polaroid Corp., 381 Mass. 545, 551-552 (1980), or the foreseeability of harm. See Saab v. Massachusetts CVS Pharm., LLC, 452 Mass. 564, 567 (2008) (Saab). Enacted in 1911, the act was intended to guarantee that workers would receive payment for any workplace injuries they suffered, regardless of fault; in exchange for accepting the statutory remedies, the worker waives any common-law right to compensation for tort injuries. See St.1911, c. 751, pt. 1, § 5, and pt. 5, § 1; Foley v. Polaroid Corp., supra at 548-549. "Unlike damages in torts, compensation under the act 'is by way of relief from inability to earn, or for deprivation of support flowing from, wages theretofore received by the employee.' " Foley v. Polaroid Corp., supra at 552 n. 5, quoting Ahmed's Case, 278 Mass. 180, 183 (1932).

The act eliminates piecemeal tort litigation and tort claims by individual workers, which are time-consuming, expensive, and afford no guarantee of compensation. See Foley v. Polaroid Corp., supra at 548-549. The bargain that is struck by the act provides predictability for both employee and employer, balancing protection for workers with certainty for employers. See Saab, supra at 567, and cases cited. While insured employers forfeit any defenses they might otherwise have had as to fault, they are protected from suit for workplace injuries, and thereby gain predictability and cost containment in conjunction with such injuries. See Wentworth v. Henry C. Baker Custom Bldg., Ltd., 459 Mass. 768, 773 nn. 6, 7 (2011); Correia v. Firestone Tire & Rubber Co., Inc., 388 Mass. 342, 349-350 (1983).

The so-called exclusivity provision of the act does not permit a covered employee both to recover compensation benefits under the act and to sue her employer to recover for an injury covered by the act. The exclusivity provision "has been the cornerstone of our Workers' Compensation Act. Our exclusivity provision is very broad. The Legislature has had opportunities to narrow its scope, and has not done so." Berger v. H.P. Hood, Inc., 416 Mass. 652, 656 (1993)....