Smith v. P. & B. Corp.

Decision Date26 March 1979
Docket NumberNo. 1-778A192,1-778A192
Citation179 Ind.App. 693,386 N.E.2d 1232
PartiesLowell C. SMITH and Doris I. Smith, Appellants (Plaintiffs Below), v. P. & B. CORPORATION, Robert C. Osborne, Paul J. Falkenstein, Mary G. Osborne, O. Paul Falkenstein, Oak Park Conservancy District, William Arnett, Harry Sandbach, and Wayne Storz, as successors to William C. Cundiff, Harry Sandbach and Donald Vascimini, all as Directors of the Oak Park Conservancy District; William E. Henderson and Paul E. Moffett, Appellees (Defendants Below).
CourtIndiana Appellate Court

David V. Scott, Kelso & Scott, Rebecca G. Looney, New Albany, for appellants.

John Vissing, Fox & Smith, Jeffersonville, David P. Varble, Varble & Varble, Jeffersonville, Virgil E. Bolly, Sellersburg, for appellees.


Plaintiffs-appellants, Lowell C. Smith and Doris I. Smith (the Smiths), bring this appeal from a summary judgment granted to defendants-appellees, P. & B. Corporation and its shareholders (P & B), and Oak Park Conservancy District and its directors (Oak Park). The Smiths contend there is a genuine issue of material fact concerning the liability of appellees for injury suffered by Smith in a sewer line construction accident.

We affirm.

Ind. Rules of Procedure, Trial Rule 56(C) provides that summary judgment shall be rendered

. . . if the pleadings, depositions, answer to interrogatories, and admissions on file, together with the affidavits and testimony, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.

Upon review of a grant of summary judgment, this court must determine if there is any genuine issue of material fact and whether the law was correctly applied. Hale v. Peabody Coal Co., (1976) Ind.App., 343 N.E.2d 316. The burden is upon the moving party to establish that no material facts are in genuine issue, and all doubts and fair inferences are to be resolved in favor of the opponent of summary judgment. Bassett v. Glock, (1977) Ind.App., 368 N.E.2d 18. The products of discovery shall be liberally construed in the non-moving parties' favor. Podgorny v. Great Central Insurance Co., (1974) 160 Ind.App. 244, 311 N.E.2d 640. Failure of the non-moving party to oppose the motion by counteraffidavits does not entitle movant to summary judgment; the moving party must still demonstrate that summary judgment is appropriate. Levy Co., Inc. v. State Bd. of Tax Commissioners, (1977) Ind.App., 365 N.E.2d 796. Finally, even if the facts are not in dispute, summary judgment is not appropriate when the information before the court reveals a good faith dispute as to the inferences to be drawn from those facts. Matter of Big Raccoon Conservancy District, (1977) Ind.App., 363 N.E.2d 1004; Hale v. Peabody Coal Co., supra.

The facts most favorable to the Smiths are that on March 28, 1972, Lowell C. Smith was working for one William Henderson as a laborer constructing a sewer line in Meadow Downs Subdivision in Clark County. The project involved the digging of a trench approximately eight feet deep in which the sewer pipe was laid. Smith was working in the trench clearing loose dirt left by a backhoe when the trench collapsed, injuring Smith. No shoring or bracing was used to support the trench.

The sewer line was being constructed for P & B, a closely-held corporation, on the basis of an oral contract between P & B and Henderson. Henderson won the contract by submitting the lowest bid of $2 per foot. The sewer pipe was being laid as part of a plan by P & B to develop the subdivision to the stage where it could be sold to builders for residence construction. P & B employed an engineer, Paul Moffett, to prepare plans for the sewer system which were to be submitted to the Oak Park Conservancy District for approval in order that the subdivision sewer system could be hooked up to the Oak Park system. The plans were prepared and tentatively approved by Oak Park, and construction was in progress when the injury occurred. Eventually, Oak Park would inspect and accept the subdivision system as part of its own.

P & B supplied the pipes and tiles necessary for the sewer project to Henderson, but supplied no tools. An officer of P & B was at the project site from time to time to see if more materials were needed, but there is no evidence that he directed or controlled Smith at any time. Moffett also was on the project staking out the line for the trench and observing construction to ensure that the project met the specifications required by Oak Park.

The Smiths brought suit against Henderson, Moffett, P & B and Oak Park. The employer, Henderson, was dismissed pursuant to TR. 12(B)(6) and no appeal was taken from that ruling. Following the filing of answers and discovery, P & B and Oak Park moved for and were granted summary judgment.

The issues presented for review revolve around whether the doctrine of Respondeat superior applies against P & B and Oak Park. If Henderson was an independent contractor, the Smiths question whether one of the exceptions to the rule of nonliability for the acts of an independent contractor applies against P & B or whether there was direct negligence by P & B (as a landowner) to Smith (as a business invitee). With respect to Oak Park, there is a further issue questioning liability for the issuance of a license permitting performance of alleged intrinsically dangerous work. 1

The Smiths first contend that there was a genuine issue of material fact as to whether the relationship between P & B and Henderson was that of master-servant or rather contractee-independent contractor.

If an employer retains sufficient right to control the work, the relationship of master-servant arises to render the employer vicariously liable for the negligence of the servant under the doctrine of Respondeat superior. Hale v. Peabody Coal Co., 343 N.E.2d at 320. However, as a general rule, the employer of an independent contractor is not liable for the torts of that contractor. Id. at 320-21 (citations omitted).

In the oft-cited decision, Prest-O-Lite Co. v. Skeel, (1914) 182 Ind. 593, 106 N.E. 365, the determinative factor of control is discussed:

It is well settled that where one lets a contract to another to do a particular work, reserving to himself no control over such work, except the right to require it to conform to a particular standard when completed, he is not liable for the negligence of the party to whom the contract is let. An independent contractor is one exercising an independent employment under a contract to do certain work by his own methods, without subjection to the control of his employer, except as to the product or result of the work. When the person employing may prescribe what shall be done, but not how it is to be done, or who is to do it, the person so employed is a contractor, and not a servant. The fact that the work is to be done under the direction and to the satisfaction of certain persons representing the employer does not render the person contracted with to do the work a servant. (Citations omitted.)

182 Ind. at 597, 106 N.E. at 367.

And in Cummings v. Hoosier Marine Properties, Inc., (1977) Ind.App., 363 N.E.2d 1266, 1272, the court stated:

If control is said to be operative when the right of some supervision is retained, it must be more than a general right which is usually reserved to all those who employ the labors of another. See, 2 Restatement of Torts 2d, § 414, at 387, Comments (1965). The control must be such as would enable the landowner to oversee the method of work employed. It must be a control which would under the common-law have given rise to the doctrine of Respondeat superior. . . .

Thus if an owner gives directions for the work, furnishes equipment for it, or retains control over any part of it, he is required to exercise reasonable care for the protection of others. But the right to control one's subcontractor must have sufficient practical effect that an imposition of vicarious liability will encourage a form of supervision which will promote accident prevention. Absent the prophylactic purposes supporting liability under Respondeat superior, the attachment of liability under the rubric of control becomes solely remedial and compensatory; a result in this case which would be confined to workmen's compensation.

The Smiths point to several factors which they contend create a factual dispute as to control. The first two are that P & B supplied the materials for the work and that an officer and major shareholder of P & B was frequently present at the job site to check on the materials needed. In Marion Shoe Co. v. Eppley, (1914) 181 Ind. 219, 104 N.E. 65, the president of the owner company was constantly on the building site, but the court did not find that determinative of the control question. Further, the owner company was supplying the building materials and the court stated:

. . . the fact that appellant furnished the brick and other building material is not controlling here in absence of a showing that the accident resulted from a defect in such material.

181 Ind. at 224, 104 N.E. at 66.

There is no evidence here that the pipe supplied by P & B in any way contributed to the injury suffered by Smith, and there is no evidence that the officer ever directed Smith in his activities.

As another indicium of control, the Smiths observe that Paul Moffett, as engineer and alleged agent of P & B drew up the plans, exercised a right of approval and staked the path for the sewers. Presto-O-Lite directly answers this argument:

Where the arrangement is that some person, representing the owner or architect, is simply to give directions as to the work to be done, and is not to give, or has no authority to give, directions as to the manner in which it should be performing it, then the owner would not be liable for injury resulting from the method of its performance, as there would be no...

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