Poch v. Bayshore Concrete Products/South Carolina, Inc.

• Decision Date: 02 October 2013
• Docket Number: No. 27304.,27304.
• Citation: 747 S.E.2d 757,405 S.C. 359
• Parties: Thelma M. POCH, as Personal Representative for the Estate of Kenneth O. Poch, Petitioner, v. BAYSHORE CONCRETE PRODUCTS/SOUTH CAROLINA, INC., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants, of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents. Kevin Key and Sandra Key, Petitioners, v. Bayshore Concrete Products/South Carolina, Inc., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants, of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents. Thelma M. Poch, as Personal Representative for the Estate of Kenneth O. Poch and Julius Poch, Petitioner, v. Bayshore Concrete Products/South Carolina, Inc., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants, of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents. Appellate Case No. 2010–149288.
• Court: South Carolina Supreme Court

405 S.C. 359

747 S.E.2d 757

Thelma M. POCH, as Personal Representative for the Estate of Kenneth O. Poch, Petitioner,

v.BAYSHORE CONCRETE PRODUCTS/SOUTH CAROLINA, INC., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants,of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents.

Kevin Key and Sandra Key, Petitioners,

v.Bayshore Concrete Products/South Carolina, Inc., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants,of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents.

Thelma M. Poch, as Personal Representative for the Estate of Kenneth O. Poch and Julius Poch, Petitioner,

v.Bayshore Concrete Products/South Carolina, Inc., Bayshore Concrete Products Corporation, Tidewater Skanska Group, Inc., and Tidewater Skanska, Inc., Defendants,of whom Bayshore Concrete Products/South Carolina, Inc., and Bayshore Concrete Products Corporation, are Respondents.

Appellate Case No. 2010–149288.

No. 27304.

Supreme Court of South Carolina.

Heard Jan. 23, 2013.

Decided Aug. 28, 2013.

Rehearing Denied Oct. 2, 2013.

John R. Kuhn, of Kuhn & Kuhn, LLC of Charleston, Robert Bratton Varnado, of Brown & Varnado, LLC of Mt. Pleasant, Christine Companion Varnado and Jason Scott Luck, both of The Seibels Law Firm, P.A. of Charleston, for Petitioners.

Barrett Ray Brewer of Clawson & Staubes, LLC of Charleston, for Respondents.

Justice BEATTY.

Kenneth Poch (“Poch”) and Kevin Key (“Key”) were temporary workers contracted through Personnel Resources of Georgia, Inc. (“Personnel Resources”) and Carolina Staffing, Inc. d/b/a Job Place of Conway (“Job Place”), to work for Bayshore Concrete Products/South Carolina, Inc. (“Bayshore SC”) to clean up a concrete casting worksite and dismantle equipment used to produce concrete forms. As a result of a tragic, work-related accident, Poch was killed and Key was injured. Poch's estate and Key received workers' compensation benefits through Job Place.

Subsequently, Key and his wife and the estate of Poch (“Petitioners”) filed suit against Bayshore SC and its parent company, Bayshore Concrete Products Corporation (“Bayshore Corp.”).¹ The circuit court granted Respondents' motion to dismiss the actions on the ground that workers' compensation was Petitioners' exclusive remedy and, therefore, Respondents were immune from liability in a tort action. The Court of Appeals affirmed the circuit court's order. Poch v. Bayshore Concrete Products/South Carolina, Inc., 386 S.C. 13, 686 S.E.2d 689 (Ct.App.2009). This Court granted a writ of certiorari to review the decision of the Court of Appeals. Although we agree with the result reached by the Court of Appeals, we find the court incorrectly analyzed Petitioners' arguments. Accordingly, we affirm as modified.

I. Factual/Procedural History

Bayshore Corp. is a Virginia corporation that is in the business of manufacturing pre-cast concrete products for use in construction projects. On April 21, 2000, the Board of Directors for Bayshore Corp. held a meeting to discuss a bid it secured to supply pre-cast concrete forms for use in the Carolina Bays Parkway project (the “project”) in Horry County, South Carolina. On that same day, Bayshore Corp. formed Bayshore SC as its wholly owned subsidiary for the purpose of acting as a remote casting yard to fulfill the bid locally for the project. Bayshore Corp. then executed a lease for the South Carolina factory site and purchased casting equipment from the previous tenant, Traylor Brothers, to be used by Bayshore SC. Bayshore SC paid the rent for the leased property and used the equipment to produce the concrete forms. As a term of the lease, Bayshore SC was required to return the worksite to its original condition.

As the project reached its final stages, Bayshore SC began the cleanup of the worksite by dismantling the equipment and casting beds that were used to create the pre-stressed concrete forms. Because many of the Bayshore SC payroll employees left to seek other employment as the project drew to a close, Bayshore SC sought to hire temporary laborers to assist in the site cleanup and equipment dismantling. Bayshore SC contracted with Job Place to hire workers to help with the project, including Poch and Key.

On June 6, 2002, Poch and Key were directed by Larry Lenart, Bayshore SC's supervisor, to enter a trench dug by Lenart in order to dig around buried steel girders to extract the concrete abutments. When the trench collapsed, Key was injured and Poch was killed. After the accident, Poch's estate and Key received workers' compensation benefits through Job Place.

Subsequently, Petitioners sued Bayshore Corp. and Bayshore SC in tort. In their Answer, Bayshore Corp. and Bayshore SC claimed Poch and Key were statutory employees of both the parent and the subsidiary. Based on this claim, Bayshore Corp. and Bayshore SC moved for summary judgment or, alternatively, for a dismissal due to the lack of subject matter jurisdiction because workers' compensation was the exclusive remedy for Poch and Key.

After a hearing, during which the parties submitted affidavits ² and deposition testimony, the circuit court ruled that Bayshore Corp. and Bayshore SC were immune from civil suit as Petitioners' claims fell within the exclusive jurisdiction of the Workers' Compensation Act (the “Act”). In so ruling, the court found: (1) Poch and Key were leased employees who performed the work of Bayshore SC and, in turn, that of Bayshore Corp. at the time of the accident; (2) both corporations were entitled to immunity pursuant to the workers' compensation exclusivity provision because Bayshore SC, the special employer of Poch and Key, was performing the work of Bayshore Corp.; (3) Bayshore SC and Bayshore Corp. were statutory employers of Poch and Key because the employees were performing the work of both corporations; (4) both Bayshore Corp. and Bayshore SC were entitled to workers' compensation exclusivity under the contractor/subcontractor analysis; and (5) both corporations were entitled to tort immunity as they secured workers' compensation coverage for Poch and Key.

Following the denial of their motions for reconsideration, Petitioners appealed the circuit court's order to the Court of Appeals. The Court of Appeals affirmed the decision of the circuit court. Poch v. Bayshore Concrete Products/South Carolina, Inc., 386 S.C. 13, 686 S.E.2d 689 (Ct.App.2009). In finding that Petitioners' exclusive remedy was workers' compensation benefits, the court ruled: (1) Bayshore SC was Poch's and Key's statutory employer; ³ (2) Petitioners failed to present evidence as to any exception or statutory provision that would eliminate Bayshore SC's immunity; ⁴ (3) Poch and Key were statutory employees of Bayshore Corp. under a contractor/subcontractor analysis and, thus, Bayshore Corp. could invoke the workers' compensation exclusivity provision; and (4) the admission of certain affidavits did not warrant reversal. Id. at 23–32, 686 S.E.2d at 694–99.

This Court granted a writ of certiorari to consider whether the Court of Appeals erred in holding that: (1) Bayshore Corp. was entitled to tort immunity as an upstream, statutory employer of Poch and Key; and (2) Bayshore Corp. and Bayshore SC complied with the statutory requirements of securing workers' compensation coverage for Poch and Key. We denied the petition as to Petitioners' challenge regarding the admission of the affidavits.

II. Discussion

A. Jurisdictional Implications of Exclusive–Remedy Doctrine

“The Workers' Compensation Act is the exclusive remedy against an employer for an employee's work-related accident or injury.” Edens v. Bellini, 359 S.C. 433, 441, 597 S.E.2d 863, 867 (Ct.App.2004). “The exclusivity provision of the Act precludes an employee from maintaining a tort action against an employer where the employee sustains a work-related injury.” Id. at 441–42, 597 S.E.2d 863. This exclusivity provision states:

The rights and remedies granted by this Title to an employee when he and his employer have accepted the provisions of this Title, respectively, to pay and accept compensation on account of personal injury or death by accident, shall exclude all other rights and remedies of such employee, his personal representative, parents, dependents or next of kin as against his employer, at common law or otherwise, on account of such injury, loss of service or death.

Provided, however, this limitation of actions shall not apply to injuries resulting from acts of a subcontractor of the employer or his employees or bar actions by an employee of one subcontractor against another subcontractor or his employees when both subcontractors are hired by a common employer.

S.C.Code Ann. § 42–1–540 (1985). “The exclusivity provision of the Act applies both to ‘direct’ employees and to those termed ‘statutory employees' under § 42–1–400.” ⁵Edens, 359 S.C. at 445, 597 S.E.2d at 869.

“South Carolina courts have repeatedly held that determination of the employer-employee relationship for workers' compensation purposes is jurisdictional. Consequently, this Court has the power and duty to review the entire record and decide the jurisdictional facts in accord with the preponderance of the evidence.” Glass v. Dow Chem. Co., 325 S.C. 198, 201–02, 482 S.E.2d 49, 51 (1997). “Any doubts as to a worker's status should be resolved in favor of including him or her under the Worker's Compensation Act.” Posey v. Proper Mold & Eng'g, Inc., 378 S.C. 210, 218–19, 661 S.E.2d 395, 400 (Ct.App.2008).

B. Status of Bayshore SC

Petitioners assert the Court of Appeals erred in determining that Bayshore Corp.⁶ was entitled to workers' compensation exclusivity as a statutory employer of Poch and Key. In support of this assertion, Petitioners claim that Bayshore Corp. was a “co-subcontractor”...