Wolf v. Kajima Intern. Inc.

• Decision Date: 29 September 1993
• Docket Number: No. 86A05-9210-CV-357,86A05-9210-CV-357
• Citation: 621 N.E.2d 1128
• Court: Indiana Appellate Court
• Parties: Gary R. WOLF, Appellant-Plaintiff, v. KAJIMA INTERNATIONAL INC., Subaru-Isuzu Automotive, Inc., Isuzu Motors America, Inc., d/b/a Isuzu Motors Limited, and Fuji Heavy Industries Ltd., Appellees-Defendants.

Page 1128

621 N.E.2d 1128

Gary R. WOLF, Appellant-Plaintiff, v. KAJIMA INTERNATIONAL INC., Subaru-Isuzu Automotive, Inc.,

Isuzu Motors America, Inc., d/b/a Isuzu Motors

Limited, and Fuji Heavy Industries Ltd.,

Appellees-Defendants.

No. 86A05-9210-CV-357.

Court of Appeals of Indiana,

Fifth District.

Sept. 29, 1993.

David V. Scott, New Albany, Charles R. Vaughan, Vaughan and Vaughan, Lafayette, John A. Larson, Williamsport, for appellant-plaintiff.

Stephen R. Pennell, Brent W. Huber, Stuart & Branigin, Lafayette, James W. Hehner, Sipe Pankow Han Rumely & Hehner, Indianapolis, for appellees-defendants.

RUCKER, Judge.

When Gary R. Wolf sustained severe and permanent on-the-job injuries he filed a negligence action against Subaru-Isuzu Automotive, Inc. (Subaru), the owner of the work site, Kajima International, Inc. (Kajima), the general contractor of the work site, Fuji Heavy Industries, LTD. (Fuji), a corporate shareholder of Subaru, and Isuzu Motors America, Inc., d/b/a Isuzu Motors Limited. Subaru, Kajima and Fuji filed motions for summary judgment which the trial court granted. Wolf now appeals raising five issues for our review which we consolidate and rephrase as whether the trial court erred in entering summary judgment in favor of Subaru and Kajima. ¹ Wolf does not challenge the entry of summary judgment in favor of Fuji. We reverse.

In 1987, Subaru accepted a bid from Kajima to serve as a general contractor for an automobile plant that Subaru was constructing in Lafayette, Indiana. Kajima, in turn, hired a number of subcontractors to work on the project including C.J. Rogers, Inc. As a part of the construction project for the plant, Subaru purchased worker's compensation insurance for itself, the general contractors, and the various subcontractors. The worker's compensation policy, issued by the Tokio Marine and Fire Insurance Company, was referred to as an owner controlled "wrap-up" or "wrap-around" insurance policy and contained a general policy of insurance with separate policy certificates issued to each contractor and subcontractor. Subaru paid the insurance premium on the policy. The total annual premium for the policy issued on behalf of C.J. Rogers equalled $78,878.00.

On August 11, 1989, Wolf was working at the Lafayette plant as an employee of C.J. Rogers, Inc. While so employed, Wolf was struck by a section of heavy steel that became dislodged from a crane. As a result, Wolf sustained severe and permanent injuries including the amputation of his left leg below the knee and a crushed right femur. Thereafter, Wolf filed a claim for worker's compensation and received benefits from Tokio Marine in the amount of $148,646.00. Wolf subsequently filed this civil action for negligence seeking damages for his injuries.

Subaru, Kajima and Fuji filed motions for summary judgment. After conducting a hearing, the trial court granted summary judgment in favor of Fuji on the grounds that it was merely a shareholder of Kajima and exercised no control over and had no involvement in the construction of the Lafayette plant. The trial court granted summary judgment in favor of Subaru and Kajima on the grounds that public policy demanded that Subaru and Kajima be treated as "statutory employers" because they provided workers compensation benefits to Wolf. Thus, according to the trial court, Subaru and Kajima should receive the benefit of that section of the Worker's Compensation Act which provides immunity to employers from civil actions filed by injured employees. Isuzu Motors America, Inc., d/b/a Isuzu Motors Limited did not file a motion for summary judgment and they are not parties to this appeal. ²

In entering its order of summary judgment the trial court set forth detailed findings and conclusions. Specific findings entered by the trial court when ruling on motions for summary judgment afford the appellant an opportunity to address the merits of the trial court's rationale. Fort Wayne Patrolman's Benev. Ass'n, Inc. v. City of Fort Wayne (1980), Ind.App., 408 N.E.2d 1295, 1300-01, reh. denied. The specific findings and conclusions also aid our review by providing us with a statement of reasons for the trial court's actions. However, they have no other effect. Strutz v. McNagny (1990), Ind.App., 558 N.E.2d 1103, 1106, trans. denied. Rather than relying upon the trial court's findings and conclusions, we must base our decision upon the Rule 56(C) materials properly presented to the trial court. Our standard of review is the same as it was for the trial court: whether there was any genuine issue of material fact and whether the moving party was entitled to judgment as a matter of law. City of Columbus Bd. of Zoning Appeals v. Big Blue (1992), Ind.App., 605 N.E.2d 188. Where the facts are not in dispute, the propriety of summary judgment becomes solely a question of law. O'Neal v. Throop (1992), Ind.App., 596 N.E.2d 984, trans. denied.

The Indiana Worker's Compensation Act (Act) provides immunity for negligent acts committed by "employers" and "persons in the same employ" as the injured party. See Ind.Code Sec. 22-3-2-6. At the time of his injury Wolf was employed by C.J. Rogers, Inc., a subcontractor. Thus, according to Wolf only C.J. Rogers is entitled to the immunity afforded by the Act.

Subaru counters that because Wolf collected worker's compensation benefits under the Tokio Marine "wrap-up" or "wrap-around" insurance policy, he surrendered his option to collect compensation from Subaru under a separate tort action. Subaru advances two interrelated theories in support of its position, namely: (1) Wolf has elected his remedy and (2) Subaru is a statutory employer.

In Lackey v. DuHadway Co., (1990), Ind.App., 560 N.E.2d 671, trans. denied, Kirt Lackey worked for his father, Owen Lackey, who was a subcontractor for Wainwright Construction Company (Wainwright). Wainwright, in turn was a subcontractor of the DuHadway Company (DuHadway). DuHadway did not obtain a certificate of insurance from its subcontractors showing that they had complied with the provisions of the Worker's Compensation Act by securing worker's compensation insurance. After Lackey sustained an on-the-job injury, DuHadway agreed to pay Lackey damages and signed a standard form agreement which the Worker's Compensation Board approved. After collecting the compensation, Lackey filed a negligence action against both DuHadway and Wainwright. On appeal, the Third District of this court observed that Kirt Lackey had the option of suing for tort damages or filing for worker's compensation payments or seeking both remedies at the same time. See Ind.Code Sec. 22-3-2-13. The court indicated however that Lackey could collect only one of the remedies. Because Lackey had collected the worker's compensation remedy, the court held, "[w]hen Kirt Lackey collected the worker's compensation remedy, he surrendered his option to seek and collect a tort remedy against all the parties liable for his worker's compensation." Lackey, 560 N.E.2d at 673. According to Subaru, the "election of remedies" reasoning used in Lackey is equally applicable here and likewise the result should be the same. We disagree for two reasons.

First, the facts in this case are readily distinguishable. Lackey involved an immediate employer/subcontractor who did not have worker's compensation insurance. Because the general contractor failed to extract a certificate from the subcontractor showing compliance with the Act, it was liable to provide worker's compensation benefits and to pay those benefits. Ind.Code Sec. 22-3-2-14(b). That is not the case here for reasons we discuss later in this opinion. Second, under Indiana's prior worker's compensation statutory scheme an injured employee, after pursuing a worker's compensation remedy along with a tort remedy, was explicitly prevented from collecting under both. ³ See Artificial Ice & Cold Storage Co. v. Ryan (1935), 99 Ind.App. 606, 193 N.E. 710; Artificial Ice & Cold Storage Co. v. Waltz (1925), 86 Ind.App. 534, 146 N.E. 826, trans. denied; In re Waltz (1923), 79 Ind.App. 298, 138 N.E. 94 (collectively referred to as the "Artificial Ice Trilogy"). The election of remedies provision under the prior statute was clearly designed to prohibit an injured employee from collecting double recovery for the same injury.

Under our present statutory scheme the strong policy of prohibiting double recovery remains intact. However, as noted in Lewis v. Lockard (1986), Ind.App., 498 N.E.2d 1024, 1026, trans. denied, the specific provision in the prior version of Ind.Code Secs. 22-3-2-13 and 14 denying the collection for both worker's compensation and tort damages has been replaced by a statutory scheme which also prevents double recovery, but through elaborate subrogation provisions. Lewis at 1026 citing ...