Opinion
NO. 2015-CA-001802-MR
03-24-2017
JW RESOURCES, INC.; STRAIGHT CREEK COAL MINING, INC.; and CASEY MIRACLE APPELLANTS v. KEVIN CALDWELL; TIFFANY CALDWELL; and KENTUCKY EMPLOYERS' MUTUAL INSURANCE APPELLEES
BRIEF AND ORAL ARGUMENT FOR JW RESOURCES, INC.; STRAIGHT CREEK COAL MINING, INC.; AND CASEY MIRACLE: William H. Partin, Jr. Lexington, Kentucky BRIEF FOR KEVIN CALDWELL AND TIFFANY CALDWELL: Ryan Biggerstaff Pikeville, Kentucky Gary C. Johnson Pikeville, Kentucky ORAL ARGUMENT FOR KEVIN CALDWELL AND TIFFANY CALDWELL: Ryan Biggerstaff Pikeville, Kentucky BRIEF FOR KENTUCKY EMPLOYERS' MUTUAL INSURANCE: W. Barry Lewis Hazard, Kentucky
NOT TO BE PUBLISHED APPEAL FROM BELL CIRCUIT COURT
HONORABLE ROBERT COSTANZO, JUDGE
ACTION NO. 14-CI-00496 OPINION
REVERSING IN PART, DISMISSING IN PART, AND REMANDING
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BEFORE: JONES, D. LAMBERT AND TAYLOR, JUDGES. LAMBERT, D., JUDGE: The Appellants, JW Resources, Inc. (hereinafter "JWR"), Straight Creek Coal Mining, Inc. ("Straight Creek"), and Casey Miracle, seek this Court's review of the Bell Circuit Court's denial of their motion for summary judgment. In this interlocutory appeal, this Court must determine whether each of the Appellants are entitled to "up-the-ladder" immunity in this civil action for negligence, and whether the trial court correctly concluded that unresolved issues of material fact preclude summary judgment. Having reviewed the record, we reverse, in part, the ruling of the Bell Circuit Court, and dismiss, in part, as not having been taken from an appealable order.
I. FACTUAL AND PROCEDURAL HISTORY
Appellee, Kevin Caldwell, worked as an employee of J. Turner Trucking Company ("J. Turner Trucking") of Jonesville, Virginia. J. Turner Trucking entered into a coal hauling contract with Xinergy Corporation (a Tennessee corporation), which sold the mine site to Straight Creek. According to documents in the record, Xinergy assigned the J. Turner hauling service contract to Straight Creek simultaneously with transfer of ownership of the mine to Straight Creek. Casey Miracle worked for Straight Creek as the mine foreman at the time of Caldwell's injury.
The record indicates both that JWR and Straight Creek own the mine site. An affidavit from a JWR corporate officer claims ownership, but documentation identifies Xinergy Corp. as "seller" and Straight Creek as "buyer" in the transaction.
On March 4, 2014, Caldwell drove a loaded coal truck on a private coal road on the mine premises. The road had been built that very morning for the purpose of hauling coal from one location on the mine campus to another, in this instance transporting the coal from a pit to a staging area. Caldwell had already made one successful run across the road that morning, but encountered difficulty on his second. Caldwell alleges that, due to the negligence of the Appellants in designing, constructing and/or maintaining this private coal road, he was unable to traverse the grade of a hill in the road. The truck rolled backward and overturned. The Appellants contend that a mechanical failure of the truck acted as both proximate and legal cause of the accident.
MSHA, the Mine Safety and Health Administration cited Straight Creek for the unsafe grade on the haul road. A road grade is its percent of vertical elevation per 100 feet of horizontal distance. Inspectors measured a grade of 18-19 percent at the location of the accident. --------
While the truck flipped over, Caldwell leaped from it, sustaining injuries. He asserts that he is now permanently impaired, having endured multiple surgeries and now requiring long-term home care. Tiffany Caldwell, his wife, asserted a loss of consortium claim. Caldwell sought and received workers' compensation benefits through his employer, J. Turner Trucking.
The Caldwells initiated this additional civil action, alleging negligence against the Appellants, on December 30, 2014. Though no depositions were taken, the parties did exchange written discovery. The Appellants moved for summary judgment in May of 2015 on the basis of "up-the-ladder" immunity.
In ruling on the motion, the trial court considered two issues: 1) whether the record showed Caldwell had received workers' compensation benefits and 2) whether the record presented adequate proof on the issue of fact that Caldwell was engaged in work that is a regular or recurrent part of the Appellants' business at the time of the accident. The trial court concluded that the record presented a genuine issue of fact relating to whether JWR and Straight Creek are "in the business of hauling coal, as well as other facts relevant to Defendants' motion for summary judgment[,]" and denied the motion. This appeal ensued, wherein the Appellants argue that the trial court erred in determining an issue of fact exists.
II. ANALYSIS
A. JURISDICTION AND STANDARD OF REVIEW
While normally this Court requires a final judgment to confer jurisdiction, certain issues may evoke this Court's jurisdiction immediately to review an interlocutory order, such as a claim of immunity. Breathitt County Board of Educ. v. Prater, 292 S.W.3d 883 (Ky. 2009). This Court recently reaffirmed that legal maxim in a case that dealt specifically with the type of immunity asserted in this appeal. Ervin Cable Constr., LLC v. Lay, 461 S.W.3d 422 (Ky. App. 2015).
When reviewing a trial court's denial of a motion for summary judgment, this Court examines the record to determine if the trial court correctly found that it lacked genuine issues of material fact, which would entitle the moving party to judgment as a matter of law. W. Ky. Rural Electic Co-op. Corp. v. City of Bardwell, 362 S.W.3d 351, 354 (Ky. App. 2011) (quoting Scifres v. Craft, 916 S.W.2d 779 (Ky. App. 1996)). Because a trial court's examination of the record seeks only to discover the existence of unresolved questions of fact and not to weigh the evidence, Kentucky law considers any findings resulting from that examination as questions of law, subject to a de novo review. Blevins v. Moran, 12 S.W.3d 698, 700 (Ky. App. 2000).
B. THIS COURT LACKS JURISDICTION TO ENTERTAIN WHETHER
SUMMARY JUDGMENT AS TO JWR WAS APPROPRIATE
Though the Appellants' treat themselves as a singular entity, they are in fact, legally distinct corporations with, by the admission of Appellees, differing roles in the mine operation. Consequently, we examine them as separate entities, taking into account their respective roles.
The Kentucky Workers' Compensation Act (KRS Chapter 342) guarantees certain benefits to employees injured on-the-job, such as partial wage replacement, payment of the injured worker's medical expenses, and restoration of the injured worker to suitable employment. In exchange for the protection that workers' compensation coverage offers, the statute makes workers' compensation the exclusive remedy, and workers surrender the right to sue their employers for work-related injuries. "[U]nless a worker has expressly opted out of the workers' compensation system, the injured worker's recovery from the employer is limited to workers' compensation benefits. The injured worker is not entitled to tort damages from the employer or its employees for work-related injuries." Beaver v. Oakley, 279 S.W.3d 527, 530 (Ky. 2009); KRS 342.690.
"Up-the-ladder" immunity is a legal colloquialism stemming from that exclusive remedy provision in KRS 342.690. That statute provides that workers' compensation benefits comprise the sole remedy available to employees of employers which secure workers' compensation coverage, and also that contractors can fall within the definition of "employer." KRS 342.690(1). The Kentucky Supreme Court stated in Gen. Elec. Co. v. Cain, that:
If premises owners are 'contractors' as defined in KRS 342.610(2)(b), they are deemed to be the statutory, or 'up-the-ladder,' employers of individuals who are injured while working on their premises and are liable for workers' compensation benefits unless the individuals' immediate employers ... have provided workers' compensation coverage. If deemed to be 'contractors,' the owners, like any other employers, are immune from tort liability [exclusive remedy immunity] with respect to work-related injuries whether or not the immediate employer actually provided workers' compensation coverage.Gen. Elec. Co. v. Cain, 236 S.W.3d 579, 585 (Ky. 2007).
"A person who contracts with another: [...] [t]o have work performed of a kind which is a regular or recurrent part of the work of the trade [...] of such person shall for the purposes of this section be deemed a contractor[.]" KRS 342.610(2)(b). Further, in Daniels v. Louisville Gas and Elec. Co., the Court provided definitions for the words "regular" and "recurrent" in the workers' compensation context. Daniels, 933 S.W.2d 821 (Ky. App. 1996). According to Daniels, "regular" means "customary or normal, or happening at fixed intervals," and "recurrent" means "occurring again or repeatedly." Id. at 824.
In order to successfully assert up-the-ladder immunity, JWR and Straight Creek must have proven that they fell within the statutory definition of a "contractor," and only then would the analysis proceed to determine whether they enjoyed immunity. The trial court found that the record presented unresolved factual issues as to whether JWR or Straight Creek were "in the business of hauling coal" and ended its analysis there.
We disagree with the trial court that the dispositive question is whether JWR or Straight Creek engaged in the business of hauling coal. Indeed, the Court in Tom Ballard Co. v. Blevins, 614 S.W.2d 247 (Ky. App. 1980) concluded in somewhat similar factual circumstances that the record supported a finding "that the hauling of coal to the customer was a part of appellant's business" of mining coal. Id. at 249 (emphasis added). The Appellees conceded such during oral argument.
The truly operative question, as it relates to JWR, is whether a holding company, with no actual ownership interest in any of the mine's assets, engages in the coal mining business. In Elkhorn-Hazard Coal Land Corp. v. Taylor, 539 S.W.2d 10 (Ky. 1976), the Elkhorn-Hazard Coal Land Corporation's only role was to lease mineral rights to another coal company which actually mined the coal from the site. The Supreme Court held that in the absence of evidence in the record that a land company had "actually engaged in the business of mining," the land company could not be considered a statutory employer. Id. at 104.
However, the trial court based its analysis entirely on whether the record presented an issue of fact as to whether JWR engaged in hauling activity. In other words, the trial court did not actually determine whether JWR was entitled to immunity as a matter of law. Rather, the trial court made an evaluation as to whether JWR was entitled to judgment as a matter of law. This is a significant distinction, as a ruling relating directly to immunity confers this Court with jurisdiction for an interlocutory appeal pursuant to Prater and Ervin Cable, while a ruling denying summary judgment based on the record does not.
As it relates to JWR, this appeal presents the latter. Therefore, we are without jurisdiction to adjudicate the matter, and it must be dismissed as interlocutory and remanded to the trial court.
C. THE TRIAL COURT IMPROPERLY FOUND THAT STRAIGHT
CREEK IS NOT ENTITLED TO "UP-THE-LADDER" IMMUNITY
As noted above, the roles of these two entities in the operation of the mine differ, but according to the written discovery, Straight Creek operates the mine, while JWR merely owns Straight Creek. Evidence introduced by Straight Creek indicates Straight Creek's activities include the mining of coal, placing it in coal pits, and transporting the coal elsewhere from the coal pits (which is the activity contracted out to J. Turner Trucking). Such activities not only fall within the activities of coal mining as an industry, but also the regular and recurrent activity of Straight Creek in particular, under the Daniels definitions. As the entity which operates the mine, Straight Creek unquestionably falls within the definition of "contractor" found in KRS 342.610(2)(b). Substantial evidence that the employer of an injured worker was a "statutory employer" entitles the employer to immunity as a matter of law. Cain at 585.
The Appellees assert that the record presents an unresolved issue of fact because it is unclear as to which entity—JWR or Straight Creek—that J. Turner Trucking was contracted. This distinction is immaterial, as the record shows that Straight Creek solely controls mine operations.
As a participant in the coal mining industry, which contracted out some of its regular and recurrent tasks, Straight Creek is entitled to rely on the exclusive remedy provisions of KRS 342.690 and is, as a matter of law, immune from the Appellees' claims. Cain at 585. Because the record presents no unresolved issue which could induce a reasonable fact-finder to find Straight Creek liable, the trial court erred in denying summary judgment. Steelvest, Inc. v. Scansteel Service Center, Inc., 807 S.W.2d 476, 482 (Ky. 1991).
D. THE TRIAL COURT ERRED IN FINDING THAT CASEY MIRACLE
IS NOT ENTITLED TO "UP-THE-LADDER" IMMUNITY
The Kentucky Supreme Court held in Fireman's Fund Ins. Co. v. Sherman & Fletcher, 705 S.W.2d 459 (Ky. 1986), that all employees of an employer immune under KRS 342.690 also enjoy immunity to the same extent of the employer. Id. at 464.
The Appellees presented no evidence disputing that Straight Creek employs Casey Miracle—they even alleged that very fact themselves in their complaint. In addition, the Appellees' arguments regarding Miracle rely on the proposition that Straight Creek does not have immunity. In light of our conclusion regarding Straight Creek's entitlement to immunity, the rule of Sherman & Fletcher becomes dispositive. Miracle benefits from the same immunity under KRS 342.690 as does Straight Creek.
III. CONCLUSION
After analyzing the three defendants as separate legal entities, we conclude that the record establishes only that Straight Creek engages in coal mining. Because Straight Creek contracted J. Turner Trucking to perform services which are regular and recurrent in the mine operations, Straight Creek qualifies as a "statutory employer" under KRS 342.690, entitling it to rely on the exclusive remedy provisions. Further, we conclude that Sherman & Fletcher controls in this situation, and cloaks Miracle, as Straight Creek's agent and employee, in the same immunity from which it benefits. Accordingly, we reverse the trial court as it relates to Straight Creek and Miracle.
As it relates to JWR, because the trial court did not address the immunity issue directly, instead basing its ruling on the absence of an unresolved factual issue, we must conclude that this appeal is taken from a non-final order, leaving us without jurisdiction. Consequently, the portion of this appeal relating to JWR is dismissed as interlocutory and remanded to the trial court for further proceedings.
ALL CONCUR. BRIEF AND ORAL ARGUMENT
FOR JW RESOURCES, INC.;
STRAIGHT CREEK COAL MINING,
INC.; AND CASEY MIRACLE: William H. Partin, Jr.
Lexington, Kentucky BRIEF FOR KEVIN CALDWELL
AND TIFFANY CALDWELL: Ryan Biggerstaff
Pikeville, Kentucky Gary C. Johnson
Pikeville, Kentucky ORAL ARGUMENT FOR KEVIN
CALDWELL AND TIFFANY
CALDWELL: Ryan Biggerstaff
Pikeville, Kentucky BRIEF FOR KENTUCKY
EMPLOYERS' MUTUAL
INSURANCE: W. Barry Lewis
Hazard, Kentucky