Hollingsworth v. Fehrs Equipment Co. of K.C.

• Decision Date: 05 December 1986
• Docket Number: No. 59295,59295
• Citation: 240 Kan. 398,729 P.2d 1214
• Parties: Henry HOLLINGSWORTH, Appellant, v. FEHRS EQUIPMENT CO. OF K.C., a Kansas Corporation, and Farmland Industries, Inc., a Kansas Corporation, Appellees.
• Court: Kansas Supreme Court

Page 1214

729 P.2d 1214

240 Kan. 398

Henry HOLLINGSWORTH, Appellant, v. FEHRS EQUIPMENT CO. OF K.C., a Kansas Corporation, and Farmland Industries, Inc., a Kansas Corporation, Appellees.

No. 59295.

Supreme Court of Kansas.

Dec. 5, 1986.

Syllabus by the Court

1. Summary judgment is proper where the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.

2. When summary judgment is challenged on appeal, an appellate court must read the record in the light most favorable to the party who defended against the motion for summary judgment.

3. If a worker can recover benefits for an injury from an employer under the provisions of the Workmen's Compensation Act, its remedy is exclusive, precluding a common-law negligence action against the employer.

4. The provisions of the Workmen's Compensation Act are to be liberally construed to bring a worker under the act whether or not it is desirable for the specific individual's circumstance.

5. K.S.A. 44-503(a) creates, for workers' compensation purposes, a statutory employer-employee relationship between injured employees of an independent contractor and the principal for whom work is being performed where the work being performed is a part of the principal's trade or business.

6. Work covered by a contract is a part of a principal's trade or business as that term is used in K.S.A. 44-503(a) if: (1) the work being performed by the independent contractor and the injured employee is necessarily inherent in and an integral part of the principal's trade or business; or (2) the work being performed by the independent contractor and the injured employee is such as would ordinarily have been done by the employees of the principal.

H. David Blair, Batesville, Ark., argued the cause, and Leo Logan, Kansas City, and Stewart Lambert, Cherokee Village, Ark., were with him on the briefs for appellant.

Lee M. Smithyman, of Weeks, Thomas & Lysaught, Chartered, Kansas City, argued the cause, and Edmund S. Gross, of the same firm, and John E. Joslin, of Farmland Industries, Inc., Kansas City, Mo., were with him on the brief for appellee Farmland Industries, Inc.

McFARLAND, Justice:

Plaintiff Henry Hollingsworth was injured in an industrial accident and brought this action seeking damages therefor. The district court entered summary judgment in favor of defendant Farmland Industries, Inc., on the basis that said corporation was a statutory employer of plaintiff and, hence, immune from liability in the negligence action herein. Plaintiff appeals from this entry of summary judgment.

The uncontroverted facts may be summarized as follows. In 1984, Cooperative Farm Chemicals Association (CFCA) operated a facility at Lawrence, Kansas, for the production of nitrogen fertilizers from natural gas. At that time, CFCA was a separate corporate entity with 75 percent of its stock being owned by defendant Farmland Industries, Inc., (Farmland) and 25 percent being owned by Missouri Farmers Association. Operation of the Lawrence plant was CFCA's only activity. The entire output of the plant was distributed to its two shareholders proportionate to their shares in CFCA. Approximately 270 people were employed by CFCA to operate the plant, including some 90 maintenance personnel. The facility contained complex chemical processing equipment which included reactors, boilers, and cooling towers.

Farmland is an agricultural cooperative supplying some 500,000 midwest farmers with products needed for agricultural pursuits. In May 1985, CFCA was merged into Farmland.

Operation of the Lawrence facility requires periodic shutdowns for normal maintenance and to effect necessary repairs. This procedure is known as a "major turnaround." On August 29, 1984, CFCA resumed operations following completion of a major turnaround. On September 2, 1984, a significant leak occurred in the north waste heat boiler, necessitating a complete plant shutdown. The boiler is known in the business as a Kellogg 101C. The need to restore the plant to its operational status as quickly as possible necessitated repair work on a round-the-clock basis.

John T. Cody Corporation (Cody), an independent contractor, was employed to do the repair work. Cody began work immediately but soon discovered that the needed repairs were more extensive than originally contemplated and that the "tube bundle" on the 101C boiler would require replacement. Spare tube bundles were kept at the Lawrence plant for such a purpose. Tube bundles are large pieces of equipment weighing several tons and require a crane to move them. To replace a tube bundle the old unit is first removed. The new bundle is then lifted by a crane onto a low flatbed trailer which is then driven to the installation site and ultimately lifted by a crane into the boiler housing. The tube bundle is a component part of the boiler and replacement thereof does not involve replacement of the entire boiler.

On September 6, 1984, a Warner Swasey Model 4435 crane owned by CFCA and being operated by one of its employees, Francis Zeller, was moving toward the replacement tube bundle preparing to lift same onto a flatbed trailer. As the CFCA crane operator began preparing for the lift, a steel cable connected to a large hook and ball on the crane separated causing the hook and ball to fall onto plaintiff who was a boilermaker employed by Cody. Plaintiff was a part of a crew whose job it was to rig the container in which the spare tube bundle was located in order that the crane could lift it onto the flatbed trailer.

Plaintiff brought this action against Farmland (as successor to CFCA) alleging plaintiff's injuries had been caused by Farmland's negligence. Fehrs Corporation was also named a defendant as manufacturer of the crane.

Defendant Farmland moved for summary judgment on the ground that Farmland was a statutory employer of the plaintiff, under K.S.A. 44-503, and therefore entitled to tort immunity under the Kansas Workmen's Compensation Act. On February 5, 1986, summary judgment was granted to defendant Farmland. Fehrs was subsequently dismissed upon plaintiff's motion and is, therefore, no longer a party herein. Plaintiff challenges the propriety of the entry of summary judgment in this appeal.

The general rules relevant to the challenge to the summary judgment herein may be summarized as follows. Summary judgment is proper where the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Peoples Nat'l Bank & Trust v. Excel Corp., 236 Kan. 687, Syl. p 5, 695 P.2d 444 (1985); Lostutter v. Estate of Larkin, 235 Kan. 154, 164, 679 P.2d 181 (1984). When summary judgment is challenged on appeal, an appellate court must read the record in the light most favorable to the party who defended against the motion for summary judgment. Professional Lens Plan, Inc. v. Polaris Leasing Corp., 238 Kan. 384, Syl. p 2, 710 P.2d 1297 (1985); McAlister v. Atlantic Richfield Co., 233 Kan. 252, Syl. p 4, 662 P.2d 1203 (1983).

Some additional background is necessary before turning to specific contentions herein.

K.S.A. 1985 Supp. 44-501(b) provides:

"Except as provided in the workmen's compensation act, no employer, or other employee of such employer, shall be liable for any injury for which compensation is recoverable under the workmen's compensation act nor shall an employer be liable to any third party for any injury or death of an employee which was caused under circumstances creating a legal liability against a third party and for which workmen's compensation is payable by such employer." (Emphasis supplied.)

This statute is commonly referred to as the exclusive remedy provision of the Workmen's Compensation Act, K.S.A. 44-501 et seq. If a worker can recover benefits for an injury from an employer under the provisions of the Workmen's Compensation Act, its remedy is exclusive, precluding a common-law negligence action for damages against the employer. Zehring v. Wickham, 232 Kan. 704, Syl. p 3, 658 P.2d 1004 (1983); Fugit, Administratrix v. United Beechcraft, Inc., 222 Kan. 312, 314, 564 P.2d 521 (1977). This furthers the policy and purpose of the Workmen's Compensation Act, which is to provide an established source of benefits to the employee for injuries arising out of and in the course of his employment, and to shift from the employee to the industry certain burdens incidental to modern industrial operations. Duncan v. Perry Packing Co., 162 Kan. 79, 84, 174 P.2d 78 (1946). Further, the provisions of the Act are to be liberally construed to bring workers under the Act whether or not it is desirable for the specific individual's circumstance. Zehring v. Wickham, 232 Kan. 704, Syl. p 5, 658 P.2d 1004.

Attention is now directed to K.S.A. 44-503(a), which provides:

"Where any person (in this section referred to as principal) undertakes to execute any work which is a part of his trade or business or which he has contracted to perform and contracts with any other person (in this section referred to as the contractor) for the execution by or under the contractor of the whole or any part of the work undertaken by the principal, the principal shall be liable to pay to any workman employed in the execution of the work any compensation under the workmen's compensation act which he would have been liable to pay if that workman had been immediately employed by him; and where compensation is claimed from or proceedings are taken against the principal, then in the application of the workmen's compensation act, references to the principal shall be substituted for references to the employer, except that the amount of compensation...