Ex parte Bender Shipbuilding & Repair Co.

• Decision Date: 03 October 2003
• Citation: 879 So.2d 577
• Court: Alabama Supreme Court
• Parties: Ex parte BENDER SHIPBUILDING & REPAIR COMPANY, INC. (In re Bender Shipbuilding & Repair Co., Inc. v. Faron Walley).

879 So.2d 577

Ex parte BENDER SHIPBUILDING & REPAIR COMPANY, INC.

(In re Bender Shipbuilding & Repair Co., Inc. v. Faron Walley).

1020545.

Supreme Court of Alabama.

October 3, 2003.

Douglas L. Brown and Craig D. Martin of Armbrecht Jackson, LLP, Mobile, for petitioner.

John R. Spencer, Mobile; and C.S. Chiepalich, Mobile, for respondent.

LYONS, Justice.

Bender Shipbuilding & Repair Company, Inc., appealed to the Court of Civil Appeals from a judgment entered on a jury verdict in favor of Faron Walley. The Court of Civil Appeals affirmed the judgment. Bender Shipbuilding & Repair Co. v. Walley, 879 So.2d 568 (Ala.Civ.App. 2002). We granted certiorari review; we reverse and remand.

The Court of Civil Appeals stated the facts as follows:

"In 1990, [Faron] Walley injured his upper back while he was working at Bender's shipyard as a shipfitter for a company known as T.J. Adams, a subcontractor of Bender. For the next two years, Walley was unable to work because of his injury. During this time, T.J. Adams, through its workers' compensation insurance carrier, Liberty Mutual, paid for Walley's medical treatment and also paid Walley temporary disability compensation pursuant to the LHWCA [Longshoremen and Harbor Workers' Compensation Act, 33 U.S.C. § 901 et seq.]. Dr. James West, Walley's treating physician, eventually assigned him a 5% permanent impairment rating and released him for full-duty work with no restrictions in 1992. After his release, Walley worked for the next three years as a shipfitter, welder, and fabricator for two companies other than T.J. Adams and Bender. Walley was able to perform the same type of work he had performed before his 1990 back injury. During the three-year period between 1992 and 1995, Walley had no further injury to his back.

"In 1995, Walley was again employed by a subcontractor to work at Bender's shipyard. After approximately three months, however, Bender hired Walley to work directly for Bender. At that time, Walley was examined by Bender's physician and was determined to be physically and mentally fit for work as a shipfitter.

"In November 1996, Walley complained to his foreman at Bender that he was experiencing work-related soreness in his upper back and shoulder. Walley was examined by Dr. West and was prescribed some pain medication; he immediately returned to work. He worked for the next few weeks without incident.

"On December 9, 1996, Walley injured his back while lifting a mooring hook on a ship at Bender's shipyard. Walley informed his foreman of the injury and finished his shift despite the injury. The next morning, Walley's back pain had worsened and he contacted his foreman, who told him to contact Vicki Wagner, an employee in Bender's safety department. When Wagner asked Walley whether his injury was related to his 1990 upper-back injury, Walley stated that it might be, but that his entire back was hurting. Conflicting evidence was introduced at trial as to whether Walley's December 1996 injury was a recurrence of his 1990 injury, as opposed to an aggravation of his 1990 injury or a new injury. More importantly for purposes of Walley's intentional-fraud claim, there was conflicting evidence as to whether Bender understood and believed Walley's December 1996 injury to be a recurrence of his 1990 injury, rather than an aggravation of that injury or a new injury.

"Wagner made Walley an appointment with Dr. West, who examined Walley on December 10, 1996, and informed him that he should not return to work at that time. Dr. West examined Walley on four other occasions during the next month and, after each examination, he told Walley that he should not return to work at that time. Although a December 18, 1996, entry by Dr. West on Walley's medical chart contains a statement that `[t]he patient states that this is related to his old injury and not [a] new injury,' Dr. West's subsequent January 22, 1997, notes reflect his opinion that `this is an exacerbation of [Walley's] previous injury.'

"On January 22, 1997, Dr. West again examined Walley and released him to return to work with a light-duty restriction. Walley returned to Bender's shipyard and provided Wagner with his light-duty work release. However, Walley testified that Wagner and Jerry Davis, a safety and risk manager for Bender, discussed the release and told him that Bender had no light-duty work available.

"We note that Bender was self-insured under the LHWCA and that its light-duty work policy for partially disabled employees was in addition to its obligations with respect to compensation and medical benefits under the LHWCA. Under the light-duty work policy, Bender paid an injured employee the full amount of his or her normal weekly wage when the employee engaged in light-duty work. Employees receiving only temporary disability benefits under the LHWCA received payments equal to only a portion of their normal weekly wage. See 33 U.S.C. § 908. Davis testified that one of the reasons Bender established its light-duty work policy was that it knew that employees could become fearful, anxious, and depressed when they could not return to work after an on-the-job injury and that the policy benefited both Bender and its injured employees.

"Although T.J. Adams, through Liberty Mutual, initially paid for Walley's medical expenses resulting from his December 1996 injury, T.J. Adams refused to pay Walley's temporary disability benefits and eventually stopped paying his medical expenses. In March 1997, Walley retained an attorney and filed a complaint against Bender with the United States Department of Labor. Pursuant to its rights under the LHWCA, Bender initially contested Walley's claim. However, after a June 1997 meeting between the Department of Labor, Bender, and Walley, Bender accepted the Department of Labor's finding that Bender was responsible for Walley's medical expenses and compensation benefits under the LHWCA. Bender began paying Walley's medical expenses and, within a few weeks, also began paying Walley temporary disability benefits. Bender thereupon also offered Walley light-duty work in accordance with its light-duty work policy.

"Walley had no income between the date of his December 1996 back injury and June 1997, when Bender accepted responsibility for paying LHWCA benefits to Walley. Dr. West released Walley to return to full-duty work effective September 1, 1997.

"Although Bender paid Walley's medical expenses and also his LHWCA compensation benefits accruing after the June 1997 meeting with the Department of Labor, it was not until July 1998 that Bender paid Walley the temporary disability benefits due for the period from his December 1996 injury until the June 1997 meeting. Bender subsequently paid penalties assessed by the Department of Labor against Bender for its failure to make timely compensation payments in accordance with the LHWCA. See 33 U.S.C. § 914(e).

"Walley was unable to pay his living expenses for several months after Dr. West released him for light-duty work in January 1997. As noted, during the period, Bender did not pay Walley compensation benefits under the LHWCA and did not provide him with light-duty work. As a result, Walley borrowed money from family and friends to pay his living expenses. He also received assistance from community resources, and he eventually applied for and received food stamps. Walley averted creditors' efforts to repossess his truck and to foreclose on his home by borrowing money from his family, including a $20,000 loan from his parents. Because he had no source of income, Walley was unable to pay a court-ordered monthly child-support obligation for the benefit of his son. Walley stated that his former wife attempted to have him held in contempt for his failure to pay child support and that she refused to let him exercise his visitation rights with their son until he had paid all of his child-support obligation. As noted above, in July 1998, Bender paid Walley all of the remaining temporary disability compensation to which he was entitled. After receiving that payment, Walley paid his past-due child-support obligation; he had been unable to visit with his son for approximately 18 months. There was evidence introduced at trial indicating that Walley was so affected by his circumstances that, in May 1997, a neighbor had Walley hospitalized because he had not been eating and she was concerned about his being depressed.

"In October 1997, Walley sued Bender in the Mobile Circuit Court alleging, in pertinent part, that Walley was entitled to an offer of light-duty work after he was released for such work in January 1997, but that Bender falsely represented to Walley that no light-duty work was available. Walley alleged that as a result of Bender's alleged fraud, he suffered monetary losses and mental anguish; he requested both compensatory damages and punitive damages.

"As previously indicated, by July 1998, Bender had paid Walley all of the temporary disability compensation to which Walley was entitled pursuant to the LHWCA. Thereafter, Bender filed a motion for a summary judgment arguing, among other things, that Walley's fraud claim was barred by the exclusivity provision of the LHWCA, 33 U.S.C. § 905(a), and also that, although some courts have recognized an intentionaltort exception to the LHWCA's exclusivity provision if the employer has specifically intended to injure the employee, Walley had failed to allege and offer evidence that Bender specifically intended to injure him. The trial court denied Bender's motion.

"Walley's case proceeded to trial. At the close of Walley's evidence and again at the close of all of the evidence, Bender filed motions for a judgment as a matter of law, renewing its argument that Walley's fraud claim was barred by the exclusivity provision of the LHWCA and that Walley did not qualify for the intentional-tort exception to the LHWCA's exclusivity provision. The trial court denied both of those motions and

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