Ruh v. Metal Recycling Servs.

• Docket Number: 28163,Appellate Case 2022-000094
• Decision Date: 21 June 2023
• Parties: Lucinda Ruh, Plaintiff, v. Metal Recycling Services, LLC, Defendant.
• Court: South Carolina Supreme Court

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Lucinda Ruh, Plaintiff, v. Metal Recycling Services, LLC, Defendant.

No. 28163

Appellate Case No. 2022-000094

Supreme Court of South Carolina

June 21, 2023

Heard September 13, 2022

CERTIFIED QUESTION

ON CERTIFICATION FROM THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

James David George Jr., Graham L. Newman, and Mark D. Chappell, of Chappell, Smith & Arden, of Columbia, for Plaintiff.

Christopher A. Ogiba of Moore & Van Allen PLLC, of Charleston, and Scott M. Tyler of Moore & Van Allen PLLC of Charlotte, NC, both for Defendant.

Robert Daniel Moseley Jr. and Robert Charles Rogers of Mosely Marcinak Law Group LLP, of Taylors, for Amici Curiae South Carolina Chamber of Commerce and the South Carolina Trucking Association, Inc. Whitney B. Harrison, of McGowan, Hood, Felder, &amp Phillips, LLC, of Columbia, for Amicus Curiae South Carolina Association for Justice.

FEW JUSTICE.

The United States Court of Appeals for the Fourth Circuit certified the following question to this Court pursuant to Rule 244 of the South Carolina Appellate Court Rules:

Under South Carolina law, can an employer be subject to liability for harm caused by the negligent selection of an independent contractor?

We answer the certified question:

Yes, the principal^[1] in an independent contractor relationship may be subject to liability for physical harm proximately caused by the principal's own negligence in selecting the independent contractor.

I. Background

Metal Recycling Services, LLC, hired an independent contractor-Norris Trucking1, LLC-to transport scrap metal. A truck driver employed by Norris Trucking hit the car Lucinda Ruh was driving and injured her. Ruh sued Metal Recycling Services and its parent company, Nucor Corporation, in state court. The defendants removed the case to the United States District Court for the District of South Carolina. The district court granted the defendants' motion to dismiss, finding Ruh did not allege an employer-employee relationship between the defendants and Norris Trucking or its driver, nor did she otherwise allege any basis on which the defendants could be liable for the negligence of their independent contractor. Ruh v. Metal Recycling Servs., LLC, 436 F.Supp.3d 844, 852 (D.S.C. 2020). The district court delayed entry of judgment to allow Ruh to seek leave to amend her complaint. Id. Ruh then filed a motion to amend her complaint to add a claim that Metal Recycling Services itself was negligent in selecting Norris Trucking to transport the scrap metal. The district court denied the motion to amend and dismissed the complaint. Ruh v. Metal Recycling Servs., LLC, No. 0:19-CV-03229-CMC, 2020 WL 1303136, at *2-3 (D.S.C. Mar. 19, 2020). Ruh appealed to the United States Court of Appeals for the Fourth Circuit, which certified the question to this Court.

II. Analysis

We begin by affirming the "general rule" that a principal "is not vicariously liable for the negligent acts of an independent contractor." Rock Hill Tel. Co. v. Globe Commc'ns, Inc., 363 S.C. 385, 390, 611 S.E.2d 235, 238 (2005); see also Duane v. Presley Const. Co., 270 S.C. 682, 683, 244 S.E.2d 509, 510 (1978) (stating "an employer is not liable for the torts of an independent contractor committed in the performance of contracted work" (citing Conlin v. City Council of Charleston, 49 S.C.L. (15 Rich.) 201, 211 (1868))); Caldwell v. Carroll, 139 S.C. 163, 187, 137 S.E. 444, 452 (1927) (Cothran, J., dissenting from dismissal of petition for rehearing) ("In every clime, under every judicial sky, it has been the settled law that the proprietor of any kind of property to be constructed or improved is not liable in damages for the negligent act of an independent contractor . . . ."). Ruh's claim in her proposed Amended Complaint, however, is not based on the allegation that Norris Trucking-the contractor-was negligent. Rather, her claim is based on the allegation that Metal Recycling Services-the principal-was negligent in selecting Norris Trucking to perform the work. Thus, nothing we say in this opinion affects the general rule that a principal is not liable for the negligence of its independent contractor.

On this issue-the negligence of the independent contractor-there is one point we must make clear. In most of these cases, the plaintiff contends the independent contractor has committed a negligent act, and thus, will also be a defendant. In this case, for example, Ruh brought a separate claim against Norris Trucking and its driver for the driver's negligence in causing her injuries. In most cases in which the plaintiff sues the contractor and the principal-this case included-the plaintiff's theory is the contractor's negligence was one proximate cause of the injury, but also, the principal's negligent failure to select a competent and careful contractor was another proximate cause of the injury. See generally J.T. Baggerly v. CSX Transp., Inc., 370 S.C. 362, 369, 635 S.E.2d 97, 101 (2006) (recognizing there may be more than one proximate cause of any injury); Culbertson v. Johnson Motor Lines, Inc., 226 S.C. 13, 23, 83 S.E.2d 338, 342-43 (1954) (same). To be clear, however, proving the negligence of the independent contractor will not result in the liability of the principal. Under our decision today, there can be no recovery against the principal unless the plaintiff separately proves the negligence of the principal in selecting that particular independent contractor and that the principal's negligence was a proximate cause of the alleged injuries.

The question of whether the principal in an independent-contractor relationship can be held liable for its own negligence in selecting a particular contractor has never been squarely before this Court. We view our "yes" answer to the question, however, as a straightforward application of the defining principles of tort law in this State, and we believe our answer should come as no surprise to even a casual student of the law. See Fitzer v. Greater Greenville S.C. Young Men's Christian Ass'n, 277 S.C. 1, 3, 282 S.E.2d 230, 231 (1981) ("lay[ing] this anachronism [of charitable immunity] to rest" and stating, "There is no tenet more fundamental in our law than liability follows the tortious wrongdoer."), superseded in part by statute, Act. No. 461, 1994 S.C. Acts 4963.^[2] In fact, our predecessor Court-the Court of Appeals for the Courts of Law and Equity^[3]-anticipated today's ruling over 150 years ago. See Conlin, 49 S.C.L. at 211 (predicting that "under suitable allegations the owner might be made responsible for the misconduct or negligence of a contractor known to be unworthy of trust").^[4] As the Fourth Circuit noted in its certification order to this Court, "every other state in the Fourth Circuit has . . . recognized a duty to hire a competent independent contractor." Ruh v. Metal Recycling Servs., LLC, No. 20-1440, 2022 WL 203744, at *2 (4th Cir. Jan. 24, 2022) (citing cases). As Ruh points out in her brief, "thirty-seven states have [held a principal] owes a duty [of reasonable care] in the selection of an independent contractor."^[5] As our own research reveals, no state has held that a principal is insulated from the consequences of its own negligence simply because its contractor was also negligent in causing the injury.

Nevertheless, Metal Recycling Services argues that to answer the question "yes" would "open the floodgates," and "expand . . . the scope of liability . . . to any [principal] who does not turn every stone to investigate and analyze the independent contractor's background, resources, and qualifications." Similarly, friends of the Court-South Carolina Chamber of Commerce and The South Carolina Trucking Association, Inc.-argue answering "yes" will create "unlimited liability upon any shipper who transports goods to or through the State of South Carolina" and "has the potential to drastically, and detrimentally, impact the business environment within the State of South Carolina." Because we are obligated to take these arguments seriously, we address how we anticipate our decision will play out in this and future cases, explain the limited impact we believe our decision will have, and hopefully assure those potentially affected by our decision that, in fact, the sky is not falling.

We turn, therefore, to section 411 of the Restatement (Second) of Torts, which provides:

An employer is subject to liability for physical harm to third persons caused by his failure to exercise reasonable care to employ a competent and careful contractor

(a) to do work which will involve a risk of physical harm unless it is skillfully and carefully done, or

(b) to perform any duty which the employer owes to third persons.

Restatement (Second) of Torts § 411 (Am. L. Inst. 1965).

Ruh asks us to adopt section 411. While we find the text of and comments to subsection 411(a) will be useful in future cases as our circuit and appellate courts determine the parameters of this theory of liability, we deem it unnecessary to go so far as to "adopt" section 411. We will briefly explore four key features of subsection 411(a).^[6] First-as in any negligence action-the plaintiff must prove the defendant-in these cases the principal-did not exercise reasonable care. Second, the standard for reasonable care will vary depending on the degree to which the work involves a risk of physical harm unless done "skillfully and carefully." Third the question of reasonable care relates only to selecting a "competent and careful contractor." Finally, the plaintiff must establish the negligence of the principal was a proximate cause of the physical harm. Each of these features-and others not anticipated here-should be analyzed in future cases to develop a standard that allows an injured...