Inner Harbor Warehouse and Distribution, Inc. v. Myers
| Decision Date | 01 September 1988 |
| Docket Number | No. 1167,1167 |
| Parties | INNER HARBOR WAREHOUSE AND DISTRIBUTION, INCORPORATED, et al. v. Gordon L. MYERS , |
| Court | Court of Special Appeals of Maryland |
Laurence A. Marder (Israelson, Salsbury, Clements & Bekman, on the brief), Baltimore, for appellee.
Argued before MOYLAN, GARRITY and WENNER, JJ.
In this appeal, a principal contractor contends that the lower court erred in holding it responsible under Section 62 of Art. 101 of the Code for obtaining workers' compensation coverage for the owner of an uninsured subcontracting company. The owner was injured while transporting goods on behalf of the principal contractor.
In resolving the issue of coverage we shall determine the following: whether the failure of a controlling shareholder and officer of a subcontracting close corporation to purchase workers' compensation insurance for the corporation's employees acts as an election not to be covered by Maryland's workers' compensation provisions; 1 whether a controlling shareholder and officer of a close corporation The action giving rise to the foregoing questions had its genesis on or about December 22, 1986, the date the appellee, Gordon L. Myers, filed a claim with the Commission alleging that he had sustained compensable injuries while acting as an employee of the appellant, Inner Harbor Warehouse and Distribution, Inc. 3 After hearing, the Commission disallowed Myers' claim because it determined that he was an independent contractor at the time his injuries were incurred. Upon the denial of his motion for rehearing, Myers appealed the Commission's decision to the Circuit Court for Baltimore City. By order dated August 9, 1988, that court (Arabian, J.) granted Myers' motion for partial summary judgment, ruling, inter alia, that Myers was the "statutory employee" of Inner Harbor pursuant to Md.Ann.Code art. 101, § 62 (1957, 1985 Repl.Vol., 1988 Cum.Supp.), as a matter of law. 4
may be a "statutory employee" within the meaning of the "statutory employer" provision of the workers' compensation laws; and, whether the limitations period applicable to workers' compensation claims is tolled when a "statutory employer," with actual notice of serious injuries sustained by an individual acting as its "statutory employee," does not file a report of injury with the Workmen's Compensation Commission. 2
Before addressing the propriety of the trial court's ruling, we shall recount the undisputed facts.
Commencing during July 1984, Inner Harbor was retained by Eluma International, U.S.A., a/k/a Eluma of North America (Eluma), to transport engine blocks manufactured by a Brazilian company, Cofap Cia Fabricadora de Pecas, a/k/a Cofap S.A. (Cofap), on an ongoing basis upon the products' arrival in the Port of Baltimore. Inner Harbor was hired to haul the engine blocks in their containers from the Port of Baltimore to Inner Harbor's warehouse facility--where the containers were to be temporarily stored. Inner Harbor received compensation per container hauled from the Port of Baltimore to the warehouse facility. As Inner Harbor did not own trucks capable of hauling the containers, it retained the services of truck owners and truck operators who hauled the containers on its behalf. Representatives of Inner Harbor admitted that performing truck transportation services was part of the regular business of Inner Harbor during the time period relevant to this case.
During the relevant time period, G.K. Myers & Sons, Inc., a Maryland Close Corporation, was in the business of retaining truck operators for truck transportation companies such as Inner Harbor. Myers was the President and Chief Executive Officer of G.K. Myers & Sons and, along with his wife, held joint title to all of the corporation's outstanding shares of common stock.
Between April 1984 and October 18, 1984, Myers and other drivers of G.K. Myers & Sons operated trucks which hauled containers of the Brazilian engine blocks on behalf of Inner Harbor. During April 1984, Myers met with Reese Beane, the President and Chief Operating Officer of Inner Harbor, and requested that Inner Harbor provide workers' compensation insurance for the drivers of G.J. Myers & Sons' trucks while they were hauling on behalf of Inner On October 18, 1984, Myers was hauling a container of the engine blocks from a pier in the Port of Baltimore to Inner Harbor's warehouse facility. While Myers was travelling along the Russell Street ramp at or near Monroe Street in the City of Baltimore, the engine blocks sprung free, upsetting the container. As a result, the container and the truck--with Myers inside--fell over the side of the ramp and eventually landed upon a line of train tracks. 6
Harbor. 5
Representatives of Inner Harbor were notified of the accident shortly after it occurred. At the time of the accident, G.K. Myers & Sons did not carry workers' compensation insurance. 7
As a threshold matter, we shall discuss our role in reviewing the trial court's entry of summary judgment for Myers.
According to Md.Rule 2-501(e), summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, admissions, and affidavits show that there is no genuine dispute as to any material fact and that the party in whose favor judgment is entered is entitled to judgment as a matter of law." In determining whether any factual dispute exists, even if the underlying facts are undisputed, the trial court must resolve all inferences against the moving party. See Honaker v. W.C. & A.N. Miller Dev. Co., 285 Md. 216, 231, 401 A.2d 1013 (1979) (Honaker II ) and cases there cited.
In reviewing a grant of summary judgment, we must also decide whether there is a genuine dispute as to any material fact, with inferences drawn in favor of the non-moving party, and whether the moving party is entitled to judgment as a matter of law. See Liscombe v. Potomac Edison Co., 303 Md. 619, 621-22, 495 A.2d 838 (1985); Washington Homes v. Interstate Land Dev. Co., 281 Md. 712, 717-18, 382 A.2d 555 (1978) and cases there cited.
Inner Harbor posits that the trial court erred in failing to conclude that the decision by Myers not to purchase workers' compensation insurance for the subcontracting close corporation of which he was a controlling shareholder and officer acted as an election to be exempted from the coverage of the workers' compensation provisions as a matter of law.
Art. 101, § 21(b) details the individuals who are subject to the provisions of the workers' compensation laws. That section relates, in pertinent part, as follows:
COVERAGE OF EMPLOYEES.--The following shall constitute employees subject to the provisions of this article,
* * *
(2) Every officer of a corporation rendering services for the corporation for monetary remuneration except: (i) an officer of a close corporation, as defined in the Corporations and Associations Article, electing not to be covered under the provisions of Section 67(4) of this article....
Art. 101, § 67(4)(ii) sets forth the procedure whereby an officer of a close corporation may elect to become exempt from coverage as an "employee" under the workers' compensation laws:
Any officer of a close corporation, as defined in the Corporations and Associations Article, ... may elect to become exempt from coverage as an employee under the provisions of Section 21(b) of this article. In the event of such an election, the employer shall serve upon the employer's insurance carrier and upon the Commission written notice naming the persons electing not to be covered, and every officer of a close corporation shall be an employee within this article until such notice has been served.
In the instant case, there is no factual dispute that Myers was an officer of a close corporation "rendering services for the corporation for monetary remuneration." Furthermore, it is uncontroverted that written notice naming Myers as an officer of a close corporation electing to become exempt from coverage as an "employee" under the workers' compensation laws was never served upon the Commission.
The above facts notwithstanding, Inner Harbor presently urges us to interpret G.K. Myers & Sons' uninsured status as, ipso facto, an election by Myers to exempt himself from coverage as an "employee" under the workers' compensation laws. Because this case reaches us in the context of a motion for summary judgment, we accept as true Inner Harbor's contention that G.K. Myers & Sons' lack of workers' compensation insurance resulted directly from Myers' decision not to procure such coverage for the close corporation.
Inner Harbor's averment raises an issue of first impression in this State. The resolution of the question requires us to discern the meaning and scope of Section 67(4)(ii).
In considering the provision, it is well settled that we must ascertain and carry out the real and actual intent of the legislature. See Scott v. State, 297 Md. 235, 245, 465 A.2d 1126 (1983); State v. Loscomb, 291 Md. 424, 429, 435 A.2d 764 (1981). The primary source for determining that intent is the language of the statute itself. If it is clear, we need look no further. Ryder Truck Lines, Inc. v. Kennedy, 296 Md. 528, 535, 463 A.2d 850 (1983); Vallario v. State Roads Comm'n, 290 Md. 2, 6, 426 A.2d 1384 (1981). Thus, where statutory language is plain and free from ambiguity and expresses a definite and sensible meaning, no construction or clarification is needed or permitted. Hornbeck v. Somerset Co. Bd. of Educ., 295 Md. 597, 619, 458 A.2d 758 (1983); Blum v. Blum, 295 Md. 135, 140, 453 A.2d 824 (1983); Koyce v. State, Cent. Collection Unit, 289 Md. 134, 140, 422 A.2d 1017 (1980). In other words, a plainly worded statute should be construed without forced or subtle interpretations designed to...
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