McDonald v. Ponderosa Enterprises, Inc.

McDonald v. Ponderosa Enterprises, Inc., 2015 MT 160 (June 16, 2015) (Wheat, J.; McKinnon, J., concurring & dissenting) (5-0, aff’d)

Issue: (1) Whether the district court erred in holding the Montana Occupational Health and Safety Act did not create duty of safety running from an employer to an independent contractor; (2) whether the district court erred in prohibiting testimony related to “rules” on a construction site; and (3) whether RTK is entitled to costs and fees for being improperly joined as an appellee by Ponderosa.

Short Answer: (1) No; (2) no; and (3) no.

Affirmed

Facts: Ponderosa is a framing company, and Matt Orrell is its principal. Cody McDonald is a construction worker doing business as Head First Construction. McDonald was approved as an independent contractor by the Department of Labor in April 2008.

RTK, a construction company, hired Ponderosa to frame a quilt shop in Sidney. Ponderosa then hired McDonald as an independent contractor to assist with the framing. McDonald and Orell each worked on building separate walls of the shop. Orrell’s wall was 24-30 feet long and 12 feet tall, weighing 880-1,028 lbs.

In June 2011, Orrell asked McDonald and two plumbers working on the building to help him manually lift the wall. As the men were lifting the wall it collapsed and fell on McDonald, who was seriously injured.

McDonald filed for workers’ compensation benefits in September 2011 and began receiving $633 a week in temporary total disability payments. In doing so, McDonald contended he was an employee of Ponderosa at the time of the accident.

In February 2012, McDonald brought suit against Ponderosa and RTL, alleging, in part, negligence and violation of the MOSHA. In his complaint, McDonald claimed to be an employee of Ponderosa.

In February 2013, McDonald settled with the State Fund for $322,000.

Ponderosa moved for summary judgment on the MOSHA claim, arguing McDonald was in fact an independent contractor and MOSHA did not apply. McDonald filed an unopposed stipulation with the court declaring he was an independent contactor, and the district court granted Ponderosa summary judgment on the MOSHA claim. The court then issued an order clarifying that RTK also had no safety duties toward McDonald under MOSHA.

Procedural Posture & Holding: A jury trial was held on the remaining negligence claims. At the outset, the district court ordered the parties to refrain from discussing “rules” on a construction site, allowing them to discuss the duty of reasonable care and custom and practice. RTL moved for a directed verdict after the second day of trial, to which neither McDonald nor Ponderosa objected, and the court dismissed RTK. The jury returned a verdict that Ponderosa was not negligent. McDonald appeals, and Ponderosa cross-appeals. Ponderosa moved to include RTK in the appeal. RTK opposed the motion, and then moved to be dismissed from the appeal. The Supreme Court denied RTK’s motion, and affirms the district court.

Reasoning: (1) The plain language of § 50-71-201, MCA, supports the district court’s interpretation that the statute does not create a duty for employers to meet certain safety guidelines with respect to independent contractors. MOSHA incorporates the definition of employee from the Workers Compensation Act, which defines an employee as each person “other than an independent contractor.” 39-71-118(1)(a), MCA.

(2) The District Court used its discretion to limit the potential prejudice of testimony about “rules.” Its ruling was neither unreasonable nor arbitrary, and did not result in substantial injustice.

(3) Because this Court denied RTK’s motion to be dismissed from the appeal, it denies RTK’s request for costs and fees on appeal.

Justice McKinnon’s Concurrence and Dissent: Justice McKinnon concurs on issues (1) and (2), but would award costs and fees on appeal to RTK.