Rodriguez v. Leesburg Bus. Park, LLC

• Decision Date: 27 February 2014
• Docket Number: Record No. 122029.
• Citation: 287 Va. 187,754 S.E.2d 275
• Court: Virginia Supreme Court
• Parties: Cecilia RODRIGUEZ, Administrator of the ESTATE OF Ubaldo RODRIGUEZ v. LEESBURG BUSINESS PARK, LLC, et al.

287 Va. 187

754 S.E.2d 275

Cecilia RODRIGUEZ, Administrator of the ESTATE OF Ubaldo RODRIGUEZ

v.LEESBURG BUSINESS PARK, LLC, et al.

Record No. 122029.

Supreme Court of Virginia.

Feb. 27, 2014.

Cory R. Ford (Barbara S. Williams; Andrew K. Thomas; Dulaney, Lauer & Thomas, on briefs), for appellant.

Wirt P. Marks, IV (Harrington & Associates, on brief), for appellee Leesburg Business Park, LLC.

No brief filed by appellee Northern Virginia Electric Cooperative.

Present: All the Justices.

Opinion by Chief Justice CYNTHIA D. KINSER.

The circuit court sustained a plea in bar and dismissed this wrongful death action on the basis that the plaintiff's exclusive remedy is under the Virginia Workers' Compensation Act (the Act), Code §§ 65.2–100 through –1310. The primary issue is whether an employee of a general contractor, hired by an owner to construct warehouse buildings, was engaged in the “trade, business or occupation” of the owner under Code § 65.2–302(A) when the employee suffered fatal injuries in the course of employment. We conclude that the employee's work at the time of the accident was not part of the owner's trade, business, or occupation and will therefore reverse the circuit court's judgment.

FACTS AND PROCEEDINGS

Leesburg Business Park, LLC (LBP) contracted with E.E. Reed Construction, LP (Reed) to construct warehouse buildings on a parcel of undeveloped land owned by LBP and known as Leesburg Business Park (Park). Ubaldo Rodriguez (Ubaldo) was an employee of Reed. Ubaldo was fatally electrocuted when building materials being moved by another Reed employee came into contact with overhead electrical power lines. The Virginia Workers' Compensation Commission entered an award of benefits to Ubaldo's statutory beneficiaries under the Act.

Cecilia Rodriguez (Rodriguez) is the widow of Ubaldo and the administrator of his estate. In her capacity as administrator, Rodriguez filed a wrongful death action under Code § 8.01–50, alleging that LBP caused Ubaldo's death by negligently failing to keep its premises reasonably safe for invitees such as Ubaldo.¹ LBP filed a plea in bar, arguing that Ubaldo was the “ statutory co-employee of LBP under [the Act],” and therefore Rodriguez' claim was barred by Code § 65.2–307.

At an evidentiary hearing on the plea in bar, the circuit court heard testimony from William H. Lauer, LBP's initial manager and sole member. LBP, Lauer testified, is a “single source” entity, with no employees, which was created to own and develop a parcel of real estate and then lease or sell warehouses constructed on the parcel. LBP's operating agreement states that it was “formed for the purposes of acquiring, holding, improving, managing, leasing and selling real property in Virginia and elsewhere, and engaging in any other business agreed to by the members of the LLC and permitted under the laws of the Commonwealth of Virginia.” Lauer described LBP's operation as follows: “[A]s owner and developer, we create the opportunity, we build it, we sell it, we lease it, and we manage it.” After purchasing the property through a separate entity and determining that the property was “worthy of development,” Lauer formed LBP and assigned the purchase contract to LBP. LBP, through contracts with other entities, then determined the feasibility of development and conducted various preliminary steps to enable development of the land. Those steps included architectural, engineering, legal, and financing work.

After considering a number of general contractors, LBP contracted with Reed to construct warehouse buildings on the property. Reed was “solely responsible for doing all of the components to build the building” and was “fully in charge” of construction. Under its contract with LBP, Reed was not responsible for obtaining building permits, paying utility fees, “[m]oving ... the power lines,” or providing “signage for the project.” These responsibilities, and the responsibility of overseeing the construction process to ensure the work was done properly and according to specifications, were contracted to a consultant, or “owner's rep[resentative].” LBP had no role in the actual construction of the buildings. As Lauer stated, it did not “move earth [,] lay any rebar[,] pour any concrete [or] install windows, plumbing [or] electrical.” LBP made its money from the sale and lease of the warehouses.

The circuit court found that “LBP was in the trade, business or occupation of purchasing, developing, constructing, selling and leasing warehouse buildings on” its parcel. “[C]onstruction of the warehouses,” the court stated, “was a part of the trade, business or occupation of LBP.” Accordingly, the court concluded that Ubaldo “was a statutory co-employee of LBP” and that Rodriguez' recovery was limited to the Act. On August 10, 2010, the court entered an order sustaining the plea in bar and dismissing the amended complaint with prejudice.

We awarded Rodriguez an appeal. In an unpublished order, we held there was no evidence that Ubaldo and LBP were statutory co-employees. Rodriguez v. Leesburg Business Park, LLC, Record No. 102127, slip op. at 4 (Jan. 6, 2012) (per curiam) (unpublished). We noted that the term “statutory co-employee” is “not synonymous with the term ‘statutory employee’ as contemplated under Code § 65.2–302(A) in the context of the relationship between an alleged statutory employee and statutory employer.” Id. We reversed the judgment of the circuit court and remanded the case for further proceedings. Id.

On remand, LBP moved to reconsider its plea in bar based on the evidence presented at the original hearing. LBP argued that the evidence established it was Ubaldo's statutory employer and that Rodriguez' action against LBP was barred by the exclusivity provision under Code § 65.2–307(A). Rodriguez objected that the circuit court could not reconsider its ruling on the plea in bar because more than 21 days had elapsed since the court entered its order sustaining the plea and awarding final judgment. Thus, according to Rodriguez, Rule 1:1 divested the court of jurisdiction to modify its order. She also argued that the evidence did not establish that LBP was Ubaldo's statutory employer.

At a hearing, the circuit court first rejected Rodriguez' argument concerning Rule 1:1 and its jurisdiction to reconsider the plea in bar. The court then again found that LBP “was in the trade, business or occupation of purchasing, developing, constructing, selling and leasing warehouse buildings on” its parcel,and “the construction of the warehouses was a part of the trade, business or occupation of LBP.” The court concluded that “LBP was the statutory employer of Ubaldo and that [Rodriguez'] recovery is limited to Workers' Compensation benefits only.” It entered an order sustaining the plea in bar and dismissing the amended complaint with prejudice.

We awarded Rodriguez this appeal.

ANALYSIS

The primary issue on appeal is whether at the time of his fatal accident, Ubaldo was engaged in work that was part of LBP's trade, business, or occupation, thus making LBP Ubaldo's statutory employer under Code § 65.2–302(A). Determining whether work is part of the trade, business, or occupation of an owner is a mixed question of law and fact. Carmody v. F.W. Woolworth Co., 234 Va. 198, 201, 361 S.E.2d 128, 130 (1987). The Court views the facts and any reasonable inferences raised by the evidence in the light most favorable to the prevailing party below, LBP, and determines whether the circuit court correctly applied the law to those facts. Id. Here, because the essential facts are undisputed, we are presented only with a question of law regarding the circuit court's application of the law to those facts and therefore apply a de novo standard of review. See Hilton v. Martin, 275 Va. 176, 180, 654 S.E.2d 572, 574 (2008).

Answering the question before us “is not a simple, straightforward exercise,” Henderson v. Central Tel. Co., 233 Va. 377, 382, 355 S.E.2d 596, 599 (1987); it “depends upon the facts and circumstances of the particular case [and] ‘does not readily yield to categorical or absolute standards.’ ” Johnson v. Jefferson Nat'l Bank, 244 Va. 482, 485, 422 S.E.2d 778, 780 (1992) (quoting Bassett Furniture Indus., Inc. v. McReynolds, 216 Va. 897, 902, 224 S.E.2d 323, 326 (1976)).

The Act's exclusivity provision, Code § 65.2–307(A), mandates that the rights and remedies provided in the Act “exclude all other rights and remedies” of a covered employee or his beneficiaries for injuries sustained in the course of employment. An employee cannot maintain a common law tort action against his employer or a fellow employee for such injuries. Hudson v. Jarrett, 269 Va. 24, 29, 606 S.E.2d 827, 829 (2005). Likewise, an employee is barred from bringing such an action against a party who is not the employee's common law employer if that employer is nevertheless a “statutory employer” under Code § 65.2–302(A). Id. at 29–30, 606 S.E.2d at 829;cf. Clean Sweep Prof'l Parking Lot Maint., Inc. v. Talley, 267 Va. 210, 213, 591 S.E.2d 79, 81 (2004) (“The only exception to [the] exclusivity provision is provided in Code § 65.2–309(A) permitting an action to be maintained against an ‘other party.’ To be an ‘other party,’ a defendant must have been a stranger to the trade, occupation, or business in which the employee was engaged when he was injured.”) (internal quotation marks omitted).

With the relevant parties from this case interpolated in brackets, Code § 65.2–302(A) states:

When any person (referred to in this section as “owner”) [LBP] undertakes to perform or execute any work which is a part of his trade, business or occupation and contracts with any other person (referred to in this section as “subcontractor”) [Reed] for the execution or performance by or under such subcontractor of the whole or any part of the work undertaken by such owner, the owner [LBP] shall be liable to pay to any worker employed in the work any...