Kenyon v. Second Precinct Lounge

• Decision Date: 27 July 1989
• Docket Number: Docket No. 99496
• Parties: Robert J. KENYON, Plaintiff-Appellee, v. SECOND PRECINCT LOUNGE and Melvin T. Brick, Defendants, David Martin Olko and Kenneth Widick, Non-Parties, and Employers Temporary Service, Inc. Defendant-Appellant. 177 Mich.App. 492, 442 N.W.2d 696
• Court: Court of Appeal of Michigan — District of US

Page 696

442 N.W.2d 696

Robert J. KENYON, Plaintiff-Appellee, v. SECOND PRECINCT LOUNGE and Melvin T. Brick, Defendants David Martin Olko and Kenneth Widick, Non-Parties and Employers Temporary Service, Inc. Defendant-Appellant.

Docket No. 99496.

177 Mich.App. 492, 442 N.W.2d 696

Court of Appeals of Michigan.

Submitted Nov. 8, 1988.

Decided June 7, 1989.

Released for Publication July 27, 1989.

[177 MICHAPP 494] Thomas, Garvey, Garvey & Sciotti, P.C. by Christopher R. Sciotti, St. Clair Shores, for plaintiff-appellee.

Kohl, Secrest, Wardle, Lynch, Clark & Hampton [177 MICHAPP 495] by Michael M. Wachsberg and Timothy F. Casey, Farmington Hills, for defendant-appellant.

Before SULLIVAN, P.J., and MAHER and CLULO, ^* JJ.

PER CURIAM.

Defendant Employers Temporary Service, Inc. (ETS) appeals by leave granted from the March 3, 1987, order of the Wayne Circuit Court which denied its motion for summary disposition as to plaintiff's negligence claim. We affirm.

On March 24, 1984, defendant Kenneth Widick caused a sixty-pound mini-van door to fall across plaintiff's arms, resulting in severe injuries. Plaintiff claimed that Widick was intoxicated and had negligently caused the accident. At the time, Widick was employed by ETS (a labor broker) and was assigned to work at Tuff-Kote, Inc. in Hamtramck. Plaintiff was a former ETS employee and had just accepted full-time employment with Tuff-Kote on the day of the accident.

Plaintiff commenced this lawsuit in the Wayne Circuit Court on November 14, 1984, naming Widick, the bar where Widick had been drinking, and the bar's owners as codefendants. The complaint alleged a cause of action sounding in negligence. On July 11, 1985, plaintiff filed a first amended complaint adding ETS as a named codefendant. The substantive allegations remained the same.

On February 5, 1987, ETS filed a motion for summary disposition pursuant to MCR 2.116(C)(10), no genuine issue of material fact. ETS made the following inductive argument: (1) At the time of the accident, Widick was employed by both ETS and Tuff-Kote; (2) plaintiff, being an employee of Tuff-Kote, was necessarily a coemployee of Widick; (3) as plaintiff's coemployee, Widick was immune [177 MICHAPP 496] from suit under the Workers' Disability Compensation Act, M.C.L. Sec. 418.827(1); M.S.A. Sec. 17.237(827)(1); and (4) since Widick was immune, ETS could not be held liable for his negligence under the theory of respondeat superior.

In response to the motion, plaintiff admitted that "under the holdings of Farrell v Dearborn Manufacturing Co, 416 Mich 267 (1982), defendant Widick must be considered an employee of both ETS and Tuff-Kote but only as the exclusive remedy provision [of the workers' compensation act, MCL 418.131; MSA 17.237(131) ] applies to defendant Widick." Plaintiff went on to argue, though, that he was not employed by ETS and, therefore, he and Widick were not coemployees. Plaintiff apparently did not consider the possibility of an employment relationship with Widick vis-a-vis their mutual employment with Tuff-Kote.

A hearing on the motion was conducted on February 27, 1987. The trial court ruled that plaintiff was not an ETS employee and, therefore, the exclusive remedy provision did not operate to bar his negligence suit. As to ETS's claim that plaintiff and Widick were coemployees, the court held:

I don't even think that I have to get to the second analysis.... But if I get to your second analogy [sic: argument?] that Mr. Widick is an employee of both parties, first of all, I don't know if that's true, but there is a factual dispute there. The counsel for plaintiff has provided the Court with sufficient documentary evidence that raises a factual dispute, and makes an issue of whether or not Mr. Widick was an employee of Tuff-Kote, or of the two employers. So, based on all that, your motion is denied.

Accordingly, an order denying summary disposition to ETS was entered on March 3, 1987.

[177 MICHAPP 497] ETS thereafter applied for, and was granted, leave to appeal the denial of its motion to this Court.

The first issue we must address is whether the trial court erred in finding that there was a genuine issue of material fact as to whether Widick was a Tuff-Kote employee, and thus a coemployee of plaintiff. We hold that the trial court did err.

As previously mentioned, plaintiff admitted in his response to ETS's motion for summary disposition that Widick must be considered an employee of both ETS and Tuff-Kote pursuant to the holding of Farrell, supra. As to Widick's status as a Tuff-Kote employee, there was no factual dispute. Even had plaintiff not made his concession, though, the trial court nevertheless erred on the facts before it.

Whether a company is a particular worker's "employer," as that term is used in the workers' compensation act, is a question of law for the courts to decide if the evidence on the matter is reasonably susceptible of but a single inference. Nichol v. Billot, 406 Mich. 284, 302-303, 279 N.W.2d 761 (1979) (quoting Flick v. Crouch, 434 P.2d 256 [Okla., 1967] ). Only where the evidence bearing on the company's status is disputed, or where conflicting inferences may reasonably be drawn from the known facts, is the issue one for the trier of fact to decide. Id.

The facts of the case are substantially similar to those in Wooten v. Sennett Steel Co. (a companion case to Farrell, supra ) and Renfroe v. Higgins Rack Coating & Mfg. Co., Inc., 17 Mich.App. 259, 266, 169 N.W.2d 326 (1969), wherein it was held that, under the "economic reality test," the plaintiff was employed by both the labor broker and the temporary employer. Without reciting the numerous facts [177 MICHAPP 498] which satisfy the economic reality test in this case, it is enough to say that, in conformity with Wooten and Renfroe, Widick was the employee of both ETS and Tuff-Kote.

In his appellate brief, plaintiff seemingly argues that a factual dispute exists as to whether he and Widick were coemployees since he was not employed by ETS. Such an argument is flawed because it ignores the employment relationship that arose by virtue of plaintiff's and Widick's mutual employment with Tuff-Kote. Both the law and logic dictate that two persons, who work side-by-side for a common purpose at the same location and who share a common employer (i.e., Tuff-Kote), are "coemployees" under the workers' compensation act.

Although we have determined that there is no genuine issue of material fact that plaintiff and Widick are coemployees our inquiry is not at an end. We must now decide how that determination affects ETS's liability, if any, to plaintiff. ETS claims that, since Widick is immune from tort liability, it should not be held vicariously liable for the negligent acts. If that claim is correct, the trial court erred in denying its motion for summary disposition. Hence, the principal issue on appeal is whether a labor broker is vicariously liable, under the doctrine of respondeat superior, for the tortious acts of its employee where that employee is statutorily immune from a common-law negligence action. ¹

[177 MICHAPP 499] In Michigan, most workers who are injured on the job fall within the coverage of the Workers' Disability Compensation Act, M.C.L. Sec. 418.101 et seq.; M.S.A. Sec. 17.237(101) et seq. Section 827(1) of the act, which is known as the "coemployee provision," provides that an injured employee can maintain a common-law action for employment-related damages only where the circumstances of the injury create "a legal liability in some person other than a natural person in the same employ or the employer." M.C.L. Sec. 418.827(1); M.S.A. Sec. 17.237(827)(1), White v. Chrysler Corp., 421 Mich. 192, 196, 364 N.W.2d 619 (1984). In other words, an injured employee may bring an action against third persons other than his or her employer and coemployees. Nichol, supra, 406 Mich. p. 297, 279 N.W.2d 761. The coemployee provision does not prohibit all lawsuits for injuries sustained in the workplace regardless of the relationship between the injured worker and the tortfeasor. One reason for permitting common-law actions against third-party tortfeasors is to protect the worker and his or her family by recognizing that benefits under the act are not expected to be full compensation for all losses suffered. Franges v. General Motors Corp., 404 Mich. 590, 613, 274 N.W.2d 392 (1979).

The factual circumstances of the instant case present an issue of first impression not only to this state but apparently to many other states as well. In our research, we have been able to find only three cases where the plaintiff sued a labor broker/general employer in tort for injuries caused by its employee who, at the time, was the plaintiff's fellow employee and thus immune from common-law actions under the exclusive remedy provision of the particular workers' compensation act. Two of those cases--both from California--held that the plaintiff was not barred as a matter of law [177 MICHAPP 500] from bringing a common-law action against the labor broker/general employer. Marsh v. Tilley Steel Co., 26 Cal.3d 486, 162 Cal.Rptr. 320, 606 P.2d 355 (1980); Campbell v. Harris-Seybold Press Co., 73 Cal.App.3d 786, 141 Cal.Rptr. 55 (1977). The third case held contra. Pichardo v. Kreger Truck Renting Co., Inc., 57 A.D.2d 177, 394 N.Y.S.2d 189 (1977). We believe the California cases, especially Marsh, are better reasoned and more consistent with the workers' compensation laws of this state.

In Marsh, the plaintiff was employed as a truck driver and laborer by Maxwell Construction Company, a general concrete contractor. The defendant, Tilley Steel Company, subcontracted with Maxwell Construction to install reinforced steel in a freeway construction project. During construction, the plaintiff was injured due to the alleged negligence of Andy Wynglarz, a Tilley Steel Employee whose services as a skilled crane operator had been "borrowed" by ...