Wilson v. Beloit Corp.

• Decision Date: 16 March 1989
• Docket Number: No. 88-1126,88-1126
• Citation: 869 F.2d 1162
• Parties: Samuel Carlton WILSON and Flora Idell Wilson, his wife, Appellants, v. BELOIT CORPORATION; John Doe Defendants 1-10, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1162

869 F.2d 1162

57 USLW 2580

Samuel Carlton WILSON and Flora Idell Wilson, his wife, Appellants, v. BELOIT CORPORATION; John Doe Defendants 1-10, Appellees.

No. 88-1126.

United States Court of Appeals,

Eighth Circuit.

Submitted Sept. 23, 1988.

Decided March 16, 1989.

Robert S. Tschiemer, Little Rock, Ark., for appellants.

Dennis L. Shackleford, El Dorado, Ark., for appellees.

Before ARNOLD and BEAM, Circuit Judges, and CAHILL, ^* District Judge.

BEAM, Circuit Judge.

Samuel Carlton Wilson and Flora Idell Wilson appeal from an order of the district court which order granted summary judgment to Mr. Wilson's employer, the International Paper Company (IPC). We now reverse and remand.

I. BACKGROUND

On April 24, 1984, Mr. Wilson (appellant) suffered a severe leg injury while working at IPC. A particular machine was allegedly the cause of the injury. Appellant was awarded workers' compensation benefits for the accidental injury.

Appellant then commenced an action against the Beloit Corporation in its capacity as the manufacturer, seller, lessor or supplier of the machine that caused appellant's injury under a theory of strict liability in tort. Unfortunately, in the period between injury and lawsuit, component parts to the machine were lost.

Appellant believes that his lawsuit against Beloit is irreparably damaged without the lost items. Thus, appellant also sued IPC on the theory that it is liable to appellant in an amount equal to the value of his claim against Beloit. Appellant's theory of liability is that the component parts were intentionally destroyed or negligently lost by IPC. The district court granted IPC summary judgment on appellant's claim.

II. DISTRICT COURT'S RULING

The district court was of the view that appellant's claim against IPC sought to circumvent the immunities accorded an employer under the Arkansas Workers' Compensation Act. The court believed that the damages Wilson could recover from IPC would, in effect, amount to the same damages he received from workers' compensation. In other words, because the amount of damages flowing from a successful products liability claim against Beloit would be based on the injuries caused by the machine, allowing appellant to pursue IPC for the value of that claim would circumvent exclusive remedy and immunity provisions contained in the workers' compensation statutes. While we commend the district court's focus on the substance of appellant's claim, we must disagree with the court's conclusion that appellant's action against IPC is barred by workers' compensation law.

A. Applicability of Compensation Statute

We do not believe that the Arkansas Workers' Compensation Act applies to the injury, if any, sustained by IPC's negligent or intentional interference, if any, with appellant's cause of action against Beloit (through the loss of the component parts). An examination of the Act bears this out.

The Act applies only to claims for "injuries and death based upon accidents." Ark.Code Annot. Sec. 11-9-103(b). The "rights and remedies granted to an employee * * * on account of injury or death, shall be exclusive." Id. at Sec. 11-9-105(a). Where there are no rights or remedies granted on account of the injury sustained, then Arkansas courts find that the Act does not apply and the employer is not protected by the exclusivity provision. See Braman v. Walthall, 215 Ark. 582, 225 S.W.2d 342, 344 (1949).

B. The Injury at Issue

Appellant claims to have been injured by the loss of the machine's component parts. The loss, appellant argues, has damaged his tort claim against Beloit. The rights and remedies provided under the Act are compensation for lost wages and permanent physical impairment, and payment of medical expenses on account of the workplace injury. See Kifer v. Liberty Mut. Ins. Co., 777 F.2d 1325, 1328 (8th Cir.1985). While the claim against Beloit may include such losses, ordinarily the range of damages recoverable under a third party action permitted by compensation law is broader.

Also, it is obvious that the loss of the parts did not cause appellant to suffer physical impairment, suffer lost wages, or incur medical expenses. Rather, the loss of the component parts purports to have prejudiced the tort claim against Beloit. We can find nothing in the language of the Act which can be construed to include damages arising from such collateral negligence or intentional conduct.

If IPC had a duty to preserve the parts, and breached it, appellant has no right or remedies under the compensation act for the injury to his cause of action against Beloit. Cf. Braman, 225 S.W.2d at 344 (Act does not encompass damage to reputation caused by slander). Thus, the exclusive remedy and immunity language of the law has no applicability.

Finally, the fact that the recoverable damages under appellant's cause of action against Beloit includes, at least in part, harm already remedied under the workers' compensation statute is not dispositive. As already indicated, appellant's action against Beloit is expressly authorized by Ark.Code Annot. Sec. 11-9-410. Moreover, employer IPC is entitled, from any amount recovered from Beloit, to reimbursement for...