Taylor v. Academy Iron & Metal Co.

• Decision Date: 13 April 1988
• Docket Number: No. 87-127,87-127
• Citation: 36 Ohio St.3d 149,522 N.E.2d 464
• Parties: TAYLOR v. ACADEMY IRON & METAL CO., Appellant; Alumax, Inc., f.k.a. Apex International Alloys, Inc., Appellee.
• Court: Ohio Supreme Court

Page 149

36 Ohio St.3d 149

522 N.E.2d 464

TAYLOR v. ACADEMY IRON & METAL CO., Appellant;

Alumax, Inc., f.k.a. Apex International Alloys, Inc., Appellee.

No. 87-127.

Supreme Court of Ohio.

April 13, 1988.

Syllabus by the Court

1. Only an employee or his legal representative, not a third-party tortfeasor, may bring a civil suit against an employer alleging that the employer committed an intentional tort leading to an employee's work-related death, disease, or injury. (Blankenship v. Cincinnati Milacron Chemicals, Inc. [1982], 69 Ohio St.2d 608, 614, 23 O.O.3d 504, 508, 433 N.E.2d 572, 577, certiorari denied [1982], 459 U.S. 857, 103 S.Ct. 127, 74 L.Ed.2d 110, followed.)

2. A third-party tortfeasor has no standing to bring an indemnification claim against an employer, who is acting in compliance with the Ohio workers' compensation law, for damages suffered by an employee in the course of or arising out of his employment.

3. Relief from common-law liability under the Workers' Compensation Act extends to cases in which a third-party tortfeasor, having paid damages to an employee or his estate, seeks indemnity from the employer on the ground that the liability of the employer is primary or active and the liability of the third-party tortfeasor is secondary or passive.

Luke Scargill and Bobby Lee Taylor were employees of Apex International Alloys, Inc., a metal manufacturing concern that is now known as Alumax, Inc., the appellee herein. On August 25, 1981, as aluminum scrap was being fed into a crusher machine at Alumax, an explosion occurred which resulted in Taylor's death and serious injury to Scargill. A personal injury and wrongful death suit was filed in the Cuyahoga County Court of Common Pleas by plaintiffs Scargill and Henry Taylor, administrator of the estate of his son, Bobby Taylor, against appellant, Academy Iron & Metal Company, a Cleveland scrap dealer. The suit alleged that Academy Iron sold dangerous and defective aluminum scrap to Scargill's and Taylor's employer and sought damages from the scrap dealer on theories of products liability. Academy Iron denied the allegations.

Academy Iron filed an amended answer and brought a third-party complaint against Alumax, alleging that Bobby Taylor's death and Scargill's injuries were the result of "intentional" tortious acts by Alumax. The third-party complaint sought indemnification from Alumax to Academy Iron. Academy Iron then moved for leave to amend its third-party complaint to allege a claim for contribution. The trial court dismissed the third-party complaint, apparently, in part, on the grounds that Academy Iron had no standing to bring a third-party action against Alumax under Ohio workers' compensation law, implicitly disposing of the claim for contribution.

Thereafter, Academy Iron settled the claims of Taylor and Scargill, but it appealed the dismissal of the third-party complaint. The court of appeals affirmed the dismissal, holding that the third-party complaint was precluded by R.C. 4121.80.

The cause is now before this court pursuant to the allowance of a motion to certify the record.

Gallagher, Sharp, Fulton & Norman, Edward J. Cass, Gary L. Nicholson and James M. Speros, Cleveland, for appellant.

Ulmer, Berne, Laronge, Glickman & Curtis, Murray K. Lenson and Jeffrey Van Wagner, Cleveland, for appellee.

WRIGHT, Justice.

The primary issue presented in this appeal is whether a third-party tortfeasor, when sued by or on behalf of an injured or deceased employee, is entitled to indemnity from an employer who is a participating member of the Ohio workers' compensation system. In other words, does the workers' compensation law bar an indemnification claim by a third-party tortfeasor against an employer for damages that are suffered by an employee who is injured or killed in the course of his employment?

In our view, the Ohio Constitution and R.C. Chapter 4123 effectively preclude, on both procedural and substantive grounds, such a claim for indemnification. Procedurally, a third-party tortfeasor has no standing to seek indemnification from an employer who is in compliance with the workers' compensation law. Substantively, the law relieves a complying employer from common-law liability to anyone for damages suffered by an employee who is injured or killed in the course of his employment, unless, of course, the injury or death was caused by intentional tortious conduct of the employer and the employee himself brings a common-law action against the employer.

The above holdings rely upon a common premise: the workers' compensation system was designed to operate as an employer's exclusive form of liability for work-related injuries or deaths to employees. The rationale behind the adoption of the Ohio workers' compensation law was set forth by this court in Blankenship v. Cincinnati Milacron Chemicals, Inc. (1982), 69 Ohio St.2d 608, 614, 23 O.O.3d 504, 508, 433 N.E.2d 572, 577, certiorari denied (1982), 459 U.S. 857, 103 S.Ct. 127, 74 L.Ed.2d 110, where we stated:

" * * * The Act operates as a balance of mutual compromise between the interests of the employer and the employee whereby employees relinquish their common law remedy and accept lower benefit levels coupled with the greater assurance of recovery and employers give up their common law defenses and are protected from unlimited liability. * * * "

To accomplish this twofold goal of employer immunity and improved recovery by injured employees, an amendment to the Ohio Constitution was adopted in 1912 that paved the way for a compulsory workers' compensation law. ¹ This amendment, as embodied in Section 35, Article II of the Constitution, ² provides, in pertinent part:

"For the purpose of providing compensation to workmen and their dependents, for death, injuries or occupational disease, occasioned in the course of such workmen's employment, laws may be passed establishing a state fund to be created by compulsory contribution thereto by employers, and administered by the state, determining the terms and conditions upon which payment shall be made therefrom. Such compensation shall be in lieu of all other rights to compensation, or damages, for such death, injuries, or occupational disease, and any employer who pays the premium or compensation provided by law, passed in accordance herewith, shall not be liable to respond in damages at common law or by statute for such death, injuries or occupational disease. * * * " (Emphasis added.)

In addition, R.C. 4123.74 ³ specifically provides that:

"Except as authorized in section 4121.80 of the Revised Code, employers who comply with section 4123.35 of Revised Code shall not be liable to respond in damages at common law or by statute for any injury, or occupational disease, or bodily condition, received or contracted by any employee in the course of or arising out of his employment, or for any death resulting from such injury, occupational disease, or bodily condition occurring during the period covered by such premium so paid into the state insurance fund, or during the interval of time in which such employer is permitted to pay such compensation directly to his injured employees or the dependents of his killed employees, whether or not such injury, occupational disease, bodily condition, or death is compensable under sections 4123.01 to 4123.94 of the Revised Code."

As these provisions explicate, the General Assembly, in carrying out its constitutional mandate and adopting a workers' compensation law, provided complying employers with immunity from damages for employee injuries that arise in the course of employment. Such immunity, however, is not limited to employee claims but also applies to claims by third parties.

We agree with the Ohio appellate courts that have addressed this issue and held that these provisions demonstrate the legislature's intention to "provide against liability of the employer to anyone for damages arising from any injury, disease or bodily condition of an employee arising out of his employment," Williams v. Ashland Chemical Co. (1976), 52 Ohio App.2d 81, 86-87, 6 O.O.3d 56, 59, 368 N.E.2d 304, 308, as will be discussed infra. See, also, Maynard v. Henderson (1982), 3 Ohio App.3d 403, 405, 3 OBR 469, 471, 445 N.E.2d 727, 729; Davis v. Consolidated Rail Corp. (1981), 2 Ohio App.3d 475, 476-477, 2 OBR 601, 603, 442 N.E.2d 1310, 1312.

I

"The doctrine of standing requires a litigant to be in the proper position to assert a claim. The issue of standing involves both constitutional and prudential considerations. * * *

"Apart from its constitutional elements, the doctrine of standing also requires that a plaintiff's injury be arguably within the zone of interests to be protected or regulated by the statute in question." J.V. Peters & Co. v. Ruckelshaus (N.D.Ohio 1984), 584 F.Supp. 1005, 1008, affirmed on other grounds sub nom., J.V. Peters & Co. v. Admr., Environmental Protection Agency (C.A.6 1985), 767 F.2d 263.

Appellant asserts that it has standing to bring a third-party action against appellee for indemnification, citing as support our holding in Blankenship. In that case, we held that an intentional tort was not an "injury" arising out of the course of employment. Therefore, the workers' compensation law "does not bestow upon employers immunity from civil liability for their intentional torts and an employee may resort to a civil suit for damages." Id. 69 Ohio St.2d at 613, 23 O.O.3d at 508, 433 N.E.2d at 576.

Appellant asserts that Bobby Taylor's death and Scargill's injuries were the result of appellee's "intentional" acts within the meaning of Blankenship and Jones v. VIP Development Co. (1984), 15 Ohio St.3d 90, 15 OBR 246, 472 N.E.2d 1046. Thus, appellant contends that it, as a third-party tortfeasor, may pursue a civil suit, i.e., indemnification, against the appellee to recover damages it paid for the work-related death of Taylor and injury to Scargill.

Such a contention, however, lacks...