Sherner v. Conoco, Inc.

• Decision Date: 29 February 2000
• Docket Number: No. 98-630.,98-630.
• Citation: 2000 MT 50,995 P.2d 990,298 Mont. 401
• Parties: Peter R. SHERNER and Deborah Sherner, Plaintiffs and Appellants, v. CONOCO, INC., Defendant and Respondent.
• Court: Montana Supreme Court

995 P.2d 990

2000 MT 50

298 Mont. 401

Peter R. SHERNER and Deborah Sherner, Plaintiffs and Appellants, v. CONOCO, INC., Defendant and Respondent.

No. 98-630.

Supreme Court of Montana.

Heard November 30, 1999.

Submitted December 2, 1999.

Decided February 29, 2000.

As Amended on Denial of Rehearing March 30, 2000.

Gene R. Jarussi, Jarussi & Bishop, Billings, Montana; Thomas E. Boland, Jeremiah C. Lynch, Great Falls, Montana, for Appellant.

David A. Veeder, Jolane D. Veeder, Veeder Law Firm, Billings, Montana, for Respondent.

Lawrence A. Anderson, Great Falls, Montana; (Montana Trial Lawyers Association); Gary L. Graham, Garlington, Lohn & Robinson, Missoula, Montana (Montana Defense Trial Lawyers); Peter F. Habein, Crowley, Haughey, Hanson, Toole & Dietrich, Billings, Montana ( Farmers Insurance Exchange), for Amici.

Justice WILLIAM E. HUNT, Sr. delivered the Opinion of the Court.

¶ 1 Peter Sherner (Sherner) appeals from the order of the Thirteenth Judicial District Court, Yellowstone County, granting Respondent Conoco, Inc. (Conoco) summary judgment. We reverse and remand.

¶ 2 The two issues on appeal are:

I What standard should be used to determine whether an employers act or omission is "intentional and malicious,"thereby allowing an injured worker to bring a tort action against his employer under § 39-71-413, MCA?

II Whether it was error for the District Court to grant summary judgment in favor of Conoco.

FACTUAL BACKGROUND

¶ 3 In 1995, Sherner was an employee at the Conoco Refinery in Billings, Montana. On August 7, a leak was discovered in a nozzle of the Fluidized Catalytic Cracker (FCC) Unit. The FCC Unit makes gasoline and light cycle oil which is processed into diesel fuel. John Gott, a member of Conoco management, elected to repair the nozzle leak and at the same time, perform work inside one of the FCC vessels known as W-58. In order to bring the FCC Unit down for repair, the refinery operations crew must follow a complex and detailed shutdown procedure. Part of this procedure involves isolating the FCC Unit from other units of the Refinery which are not going to be repaired. The FCC Unit is then steamed out in order to remove hazardous gasses.

¶ 4 Once the operations crew completes this procedure, the FCC Unit is turned over to a "blind" foreman who establishes that valves are closed and checks for the existence of gas using a sensor. The blind foreman may then authorize workers to begin the process of "blinding" the FCC Unit. Blinding involves inserting flat metal plates into openings in the pipes to ensure that gas such as hydrogen sulfide (H2S) does not move through the pipes to the FCC Unit. Breathing H2S gas results in poisoning and even in very low concentrations causes headaches and nausea.

¶ 5 Two known sources of H2S are connected to the FCC Unit; the gas recovery plant (GRP), and a desulferizer known as HDS # 1. The GRP was idled but not depressurized during the August 1995 shutdown and repair and the HDS # 1 was still operating under pressure. The tendency in such a situation is for gas under pressure in a closed space to move toward an area with less pressure, i.e., from the pressurized GRP Unit and the HDS # 1 through the pipes to the non-pressurized FCC Unit.

¶ 6 According to Conoco rules no work, including blinding, could begin until the blind foreman signed a work authorization permit. It is also the blind foreman's responsibility to walk through the Unit to check valves and test for the presence of gas. Blind foreman Wayne Lipp (Lipp), tested the overhead line on W-58 and found it free of H2S. According to Conoco policy, blinding was to begin within one hour after the work permit was issued, however in this case it did not. Around this time, Gott and other managers smelled a sour gas odor in the vicinity of W-58. Management did not stop work on the shutdown as a result of this odor.

¶ 7 Approximately 2 hours after Lipp performed the gas sniff test at the top of W-58, he signed a work authorization permit allowing workers to begin installing blinds. Lipp assigned Sherner and another worker to install the blind on the overhead line leading to the W-58 tower (a vessel which is part of the FCC Unit). Sherner was exposed to H2S gas while he was installing the blind and was seriously injured. Conoco's investigation found that a valve on a line from the HDS # 1 did not seal, allowing H2S gas to flow through the overhead line to where Sherner was working.

¶ 8 Sherner alleged that Conoco and its employees were liable for his injuries by reason of their intentional and malicious actsand/or omissions. Sherner also alleged that Conoco's parent company E.I. Du Pont De Nemours and Company (Du Pont) was liable for his injuries by reason of its negligence. Sherner's wife, Debra, also joined in the case seeking to recover for her loss of consortium by reason of the injury to her husband. All four defendants in the case moved for summary judgment. The District Court granted the motions in full and entered judgment in the Defendants' favor. It is from the judgment in favor of Conoco that Sherner appeals.

STANDARD OF REVIEW

¶ 9 Summary judgment is an extreme remedy which should not be a substitute for a trial on the merits if a material factual controversy exists. Montana Metal Buildings, Inc. v. Shapiro (1997), 283 Mont. 471, 474, 942 P.2d 694, 696.Moreover, all reasonable inferences which can be drawn from the evidence presented should be drawn in favor of the nonmoving party. Montana Metal Buildings, 283 Mont. at 474, 942 P.2d at 696.

¶ 10 Our standard of review on appeal from summary judgment rulings is de novo. See Motarie v. Northern Montana Joint Refuse Disposal Dist. (1995), 274 Mont. 239, 242, 907 P.2d 154, 156; Mead v. M.S.B., Inc. (1994), 264 Mont. 465, 470, 872 P.2d 782, 785. When we review a district court's grant of summary judgment, we apply the same evaluation as the district court based on Rule 56, M.R.Civ.P. Bruner v. Yellowstone County (1995), 272 Mont. 261, 264, 900 P.2d 901, 903. The movant must demonstrate that no genuine issues of material fact exist. Once this has been accomplished, the burden then shifts to the non-moving party to prove, by more than mere denial and speculation, that a genuine issue does exist. Bruner, 272 Mont. at 264, 900 P.2d at 903. Having determined that genuine issues of fact do not exist, the court must then determine whether the moving party is entitled to judgment as a matter of law. We review the legal determinations made by a district court as to whether the court erred. Bruner, 272 Mont. at 264-65, 900 P.2d at 903.

¶ 11 I What standard should be used to determine whether an employers act or omission is "intentional and malicious," thereby allowing an injured worker to bring a tort action against his employer under § 39-71-413, MCA? ¶ 12 Sherner claims that the District Court erred when it ruled that his tort claim against Conoco was barred by the exclusive remedy provision of § 39-71-411, MCA. The District Court, citing our decision in Calcaterra v. Montana Resources, 1998 MT 187, ¶ 14, 289 Mont. 424, ¶ 14, 962 P.2d 590, ¶ 14, concluded that the law required Sherner to "allege and establish that the employer had actual knowledge that the employee was being harmed" in order to prove that the acts were malicious (emphasis original). The District Court then found that the facts were "insufficient to raise a genuine issue of material fact that Conoco directed intentional harm" at Sherner.

¶ 13 Sherner, however, contends that the District Court erred by applying the wrong standard to the facts of his case. He insists that when looking at the plain language of § 39-71-413, MCA, the facts, viewed in the light most favorable to him, with all reasonable inferences drawn in his favor, show that Conoco intentionally committed certain acts or omissions with malice which resulted in his injury. Sherner alleges that the facts surrounding the shutdown and accident showed that "acts and omissions were done intentionally in order to minimize shutdown time and the resulting financial losses." He further asserts that contrary to the District Courts finding, the plain language of § 39-71-413, MCA, does not require an injured worker prove an employer intentionally harmed him but only that he prove the act or omission which caused the injury was intentional and malicious. Sherner insists that if we apply the appropriate standard for an"intentional and malicious act or omission" it is clear that he is entitled to present his claim to a jury.

¶ 14 Sherner bases his argument on the allegation that this Courts interpretations of the phrase "intentional and malicious actor omission" have been inconsistent and require clarification. He contends that we should reverse those cases in which we have held that a worker must show an intent to harm/injure on the part of the employer as outdated and inconsistent with the legislative mandate embodied in § 39-71-413, MCA. Sherner claims such inconsistencies have arisen because this Court has not followed rules of statutory construction and recognized the impact of the 1973 statutory changes in the Act on then-existing case law.

¶ 15 Conoco responds that Sherner is precluded from arguing that this Court should adopt a new standard for determining whether an employer's act or omission is "intentional and malicious," because he failed to ask the District Court to apply a legal standard other than that already in existence. Sherner, however,insists that he did in fact preserve this issue for appeal by stating in his Brief in Opposition to Conoco's Motion for Summary Judgment; "evidence that an employer knew its acts created a high degree of harm to an employee or class of employees is sufficient to meet the intentional act requirement of § 39-71-413, MCA." Setting out the full definition of malice provided at § 1-1-204(3), MCA, Sherner stated, "[m]alice is implied where intentional acts are committed without...