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STONE v. DOOR-MAN MANUFACTURING CO., et al.



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STONE

v.

DOOR-MAN MANUFACTURING CO.,
et al.


November 3, 2000

Record No. 000175

Present: All the Justices

DANIEL F. P. STONE

v.

DOOR-MAN MANUFACTURING CO., ET AL.

FROM THE CIRCUIT COURT OF THE CITY OF NORFOLK


Junius P. Fulton, III, Judge

OPINION BY CHIEF JUSTICE HARRY L. CARRICO

The question for decision in this appeal is
whether a worker in the employ of the owner of a manufacturing
business was a statutory fellow employee of the architect and
contractors involved in a construction project at the
owner’s plant. The question arose in a personal injury
action brought by the plaintiff, Daniel F. P. Stone (Stone), an
employee of the Ford Motor Company (Ford) at its motor vehicle
assembly plant in Norfolk, against the defendants, Gala &
Associates, Inc. (Gala), the architectural firm involved in the
project, and Rudolph/Libbe, Inc. (Rudolph/Libbe), Door-Man
Manufacturing Co. (Door-Man), Lake Erie Electric, Inc. (Lake
Erie), and E. G. Middleton, Inc. (Middleton), the contractors and
subcontractors involved in the project.

The defendants filed motions to dismiss for
lack of subject matter jurisdiction, alleging that Stone’s
sole remedy was provided by the Workers’ Compensation Act
(the Act).
[1] Finding that the defendants were engaged in the trade,
business, or occupation of Ford and, consequently, were deemed to
be statutory fellow employees of Stone, the trial court held that
Stone’s personal injury action was barred by the exclusivity
provision of the Act and sustained the defendants’ motions
to dismiss. We awarded Stone this appeal.

At the time he was injured on April 11, 1996,
Stone was employed as a utility upgrader at Ford’s assembly
plant. While operating a "tow-motor vehicle" or
"tug" in the course of his employment, Stone attempted
to drive through the doorway of the body shop where he worked.
However, the overhead door "unexpectedly closed and struck
[him] in the head and chest," paralyzing him from the
mid-chest down.

The door in question was opened and closed
automatically by a device activated by electrical "inductive
loops." One loop was installed in the concrete floor
immediately inside the shop door and another in the concrete ramp
immediately outside the door. Stone claimed the loops were
incorrectly positioned with the result that when he attempted to
exit the shop through the open doorway at an angle, rather than
head-on, the inside loop failed to detect the presence of his tug
and to activate the device that would have kept the door from
descending.

The door and the body shop were located in a
former warehouse that had been remodeled and enlarged during a
renovation of the assembly plant undertaken by Ford in 1994 to
implement the manufacture of its redesigned F-150 pickup truck.
Completed several months before Stone’s accident, the new
body shop was one phase of a five-phase project.
[2]
Designated the "PN96 Body Shop Project," the proposal
for development of the shop had been the subject of an
eighteen-month effort by Ford personnel to prepare a layout,
together with "global specifications," showing
"exactly how this building should be shaped; how all the
toolings are going to fit inside; how the material is going to be
brought in; how the material is going to be arranged together;
and how it’s going to be shipped from point A to point B."

Ford then entered into a contract with Gala for
"Engineering Services for [the] Body Shop Building
Addition." Gala’s services were to consist, inter
alia, of the review of "new proposed layout" and
"construction shop drawings" as well as the preparation
of "complete design and bid documents for bid purpose,"
"complete specifications," and "as-built
drawings." Stone claimed in his motion for judgment that
Gala negligently designed the body shop and the overhead door
system, negligently supervised and inspected the installation of
the system, and negligently approved or failed to disapprove the
design of the system, proximately causing Stone’s injuries.

Rudolph/Libbe won the bid and was awarded the
contract for construction of the body shop. In what was termed a
"Full Service Contract," Rudolph/Libbe as
"Contractor" agreed to "furnish all materials,
tools, equipment, facilities, labor, means, supervision and
management to perform all work required to investigate, study,
design, detail, fabricate, deliver, construct, install, launch
and document this new PN96 Body Shop project . . . in
strict accordance with the Owner’s Instructions to Bidders,
Project Specifications, Project Timing and Standard
Specifications."

Specifically, Section 08200 of the Full Service
Contract, termed "Vertical Lift Doors," provided
for the furnishing of "all materials, equipment and labor
necessary to provide and install new vertical lift doors at docks
and ramps" and the submission of "complete shop
drawings showing details of construction, fabrication and
installation of all components for all work." Section 08200
also specified the use of a vertical lift door "as
manufactured by" Door-Man and one other supplier. Stone
claimed Rudolph/Libbe negligently installed the door system,
negligently supervised the design, manufacture, and installation
of the system by others, failed to inspect and/or negligently
inspected the system, and failed to test and/or negligently
tested the system, proximately causing Stone’s injuries.

Rudolph/Libbie entered into a subcontract with
Door-Man, requiring the latter to furnish and install the door
that was later involved in Stone’s injury. Door-Man manufactured
the door, but subcontracted with another firm, not a party to
this proceeding, to perform the actual installation. Stone
claimed that Door-Man negligently breached its duties to design,
manufacture, distribute, sell, install, inspect, and test the
overhead door system, breached its express and implied warranties
that the system was of good merchantable quality fit for its
ordinary purposes and knew or had reason to know the particular
purpose for which the door was being purchased, yet breached its
implied warranty that the door was fit for its particular
purpose, proximately causing Stone’s injuries.

Rudolph/Libbie also entered into a subcontract
with Lake Erie to perform the electrical work in connection with
the installation of the door involved in Stone’s injury.
Lake Erie then subcontracted with Middleton for the actual
performance of the electrical work. Stone claimed that Lake Erie
and Middleton negligently installed the door system and its
wiring and, after installation, failed to test and/or negligently
tested the system, proximately causing Stone’s injuries.

Stone also claimed that all the defendants: (1)
failed to instruct the users of the door system how to operate it
safely, (2) failed to warn the users of the dangers inherent in
the design and manufacturing of the system, and (3) failed to
warn the users of the risk of injury when using the system in a
reasonably foreseeable manner and for its intended purpose,
proximately causing Stone’s injuries. Stone moved for entry
of judgment jointly and severally against all defendants in the
sum of $30 million compensatory damages and $350,000 against each
defendant in punitive damages.

As noted supra, the trial court found
that because the defendants were engaged in the trade, business,
or occupation of Ford and, consequently, were fellow statutory
employees of Stone, his personal injury action was barred by the
Act’s exclusivity provision. All the defendants contend this
finding was correct and should be affirmed.

The exclusivity provision is found in Code
? 65.2-307, which reads as follows:
[3]

The rights and remedies herein granted to an
employee when his employer and he have accepted the provisions of
this title respectively to pay and accept compensation on account
of injury or death by accident shall exclude all other rights and
remedies of such employee, his personal representatives, parents,
dependents or next of kin, at common law or otherwise, on account
of such injury, loss of service or death.

The exclusivity provision does not apply,
however, to a common law action for an employee’s injury or
death against an "other party." Code ? 65.2-309; Stewart
v. Bass Constr. Co.
, 223 Va. 363, 365, 288 S.E.2d 489, 490
(1982).

"The issue whether a person is a statutory
employee presents a mixed question of law and fact which must be
resolved in light of the facts and circumstances of each
case." Cooke v. Skyline Swannanoa, Inc., 226 Va. 154,
156, 307 S.E.2d 246, 247 (1983). Where, as here, the facts
relevant to resolution of the jurisdictional issue are not in
dispute, "we must determine whether the trial court
correctly applied the law to those facts." Cinnamon v.
International Bus. Mach. Corp.
, 238 Va. 471, 474, 384 S.E.2d
618, 619 (1989).

"As a general rule, the several trades
involved in construction work are not part of the business of
manufacturing products for sale." Id. at 478, 384
S.E.2d at 621. "Every manufacturer must have a plant, but
this fact alone does not make the work of constructing a plant a
part of the trade or business of every manufacturer who engages a
contractor to construct a plant." Raines v. Gould, Inc.,
343 S.E.2d 655, 659 (S.C. Ct. App. 1986).

To support their contention that they were
engaged in the trade, business, or occupation of Ford, the
defendants emphasize the evidence concerning Ford’s eighteen
months of intensive planning for the construction project as well
as the detailed layout and "global specifications" that
were developed as a result. The defendants also cite evidence
showing that, at its assembly plant, Ford employs personnel
trained to design buildings as well as approximately 250 skilled
tradesmen, including carpenters, electricians, pipefitters,
millwrights, welders, plumbers, and others.

Each defendant says the evidence showed that
Ford, with its own employees, normally performs work at its plant
similar in all respects to the construction work required of the
particular defendant in the contractual arrangements for the
project in question. In addition, some of the defendants cite
Ford’s involvement in the day-to-day construction of the
project as evidence they were involved in Ford’s usual
business.

For example, Gala, the architect, asserts that
Ford "has made and continues to make the design of its
production facilities an integral part of its ‘normal’ trade,
occupation or business and that it did so with respect to the
design work on the new body shop in Norfolk." On "the
very door in question," Ford "produced and required
adherence to a detailed, six page specification with respect to
door design and operation."

Rudolph/Libbe, the construction contractor,
maintains that "Ford employs personnel who are capable of
and regularly perform the type of tasks contracted to
Rudolph/Libbie in this matter, and in fact Ford’s personnel
provided supervisory instruction on a daily basis to the
contractors on this job, including Rudolph/Libbe." Ford even
"specified that the external actuating loop [for the door in
question] be moved further from the door," and, after
Stone’s accident, "Ford’s own construction forces at the
Norfolk Plant added a second inductive loop on the inside of the
door in question."

Door-Man, the manufacture and installation
subcontractor, submits that Ford "manufactures its own
vertical lift doors at various Ford facilities" and
"has installed automatic opening doors at the Ford
Plant." "Ford was actively involved in all phases of
the PN-96 project, including the design, construction and
installation of the body shop and its components and particularly
the overhead door involved in this case. Ford dictated the size
of the door, where it was to be placed, the location of the
inductive loop used to operate the door as well as the location
of the guard post adjacent to the door."

Lake Erie, the electrical subcontractor, states
that "Ford electricians regularly perform the same work
which Lake Erie Electric was contracted to perform as part of the
[body shop] expansion. They have removed and replaced door loops,
relocated electric panels, and worked on the timing and
sequencing of doors."

Middleton, the electrical sub-subcontractor,
claims that it "installed the electrical components to [the] overhead door for use in Ford’s plant" and that it is
unrefuted that Ford "routinely engaged in such work on its
own" with the "80-85 full time electricians" it
employed at the plant. "In short, all of Middleton’s work,
with respect to this particular door, is also performed by the
Ford electricians in house."

Furthermore, in the arguments of the
defendants, there is an attempt by each to minimize its role in
the construction project, to isolate itself from the parts played
by other defendants, and to have us focus our attention upon its
own individual undertaking. To the extent that these arguments
are intended to shift blame for Stone’s accident, they deal with
the question of liability and hence are irrelevant to the issue
whether Stone is the defendants’ statutory fellow employee.
To the extent that the arguments are intended to individualize
our resolution of the statutory employee issue by reference to
each contract separately, we reject them. In determining whether
the defendants were engaged in the trade, business, or occupation
of Ford, rendering Stone a statutory employee, we think the
contractual obligations of the parties should be considered as a
whole and the construction of the body shop as a single project.

There is also an attempt on the part of some
defendants to characterize Ford as its own general contractor and
Rudolph/Libbe as a mere subcontractor. However, the obligations
imposed upon Rudolph/Libbe by the language quoted above from the
"Full Service Contract" clearly make Rudolph/Libbe the
general contractor on the PN96 Body Shop Project.

With respect to the law applicable to the case,
there is a lack of agreement among the parties concerning the
appropriate test to be applied in resolving the issue whether
Stone was a statutory employee. Three separate tests are
discussed in the briefs, the "normal work" test, the
"subcontracted fraction" test, and the "stranger
to the work" test.

The first, the "normal work" test,
was recognized in Shell Oil Co. v. Leftwich, 212 Va. 715,
187 S.E.2d 162 (1972). That case involved two workers employed by
a lessee of a service station owned by Shell Oil Co. We held the
workers were not the statutory employees of Shell Oil, stating as
follows:

"[T]he test is not one of whether the
subcontractor’s activity is useful, necessary, or even absolutely
indispensable to the statutory employer’s business, since, after
all, this could be said of practically any repair, construction
or transportation service. The test (except in cases where the
work is obviously a subcontracted fraction of a main contract) is
whether this indispensable activity is, in that business, normally
carried on through employees rather than independent
contractors."

Id. at 722, 187 S.E.2d at 167 (quoting
1A Arthur Larson, The Law of Workmen’s Compensation
? 49.12 (1973)).

The "normal work" test of Shell
Oil
has been discussed numerous times in our subsequent
decisions, but none involved the situation presented here, where
the question is whether a worker employed by an owner is a
statutory fellow employee of contractors and subcontractors
engaged to do construction work.
[4] Closely analogous, however, is Whalen v. Dean Steel
Erection Co.
, 229 Va. 164, 327 S.E.2d 102 (1985), where the
issue was whether a worker employed by a general contractor may
bring a tort action against a subcontractor for personal injuries
caused by the subcontractor’s negligence on the job. The worker
argued for application of the "normal work" test as
enunciated in Shell Oil and applied in Bassett, supra,
as well as Southeastern Tidewater Area Manpower Auth. v. Coley,
221 Va. 859, 275 S.E.2d 589 (1981).

We said that the worker "misapplies these
authorities." Whalen, 229 Va. at 170, 327 S.E.2d at
105. These cases, we continued, involved the question
"whether a subcontractor’s employee, injured by a general
contractor’s (or owner’s) negligence on the job, may sue such
general contractor or owner at common law or whether such general
contractor or owner has become the statutory employer of the
plaintiff." Id., 327 S.E.2d at 106. "These
statutory employer cases," we stated, "present a
question which is the obverse of the one presented here, and their
rule is inapplicable where a general contractor’s employee seeks
to sue a subcontractor
." Id. (Emphasis added.)

The second test discussed in the briefs is the
"subcontracted fraction" test, derived from the
parenthetical language in the quotation from Professor Larson’s
work. This language excepts from the "normal work" test
those "cases where the work is obviously a subcontracted
fraction of a main contract." However, in Cinnamon v.
International Bus. Mach.
, supra, we said of the
"subcontracted fraction" test:

In the context of the construction business, it
relates to a general contractor
, the party obligated by the
main contract with the owner to complete the whole project. If
the work out of which the accident arose was, in the language of Shell
Oil
, "obviously a subcontracted fraction of [that] contract" and, in the language of the statute, "not a
part of the trade, business or occupation of" the owner, the
general contractor who engaged the subcontractor to perform that
fraction is the statutory employer of the injured worker, whether
directly employed by the primary subcontractor or by a secondary
subcontractor.

238 Va. at 476, 384 S.E.2d at 620 (emphasis
added).
[5] Hence, the "subcontracted
fraction" test does not relate to the situation involved
here, where the employee of an owner, not a subcontractor, is the
injured worker.
[6]

The third test is the "stranger to the
work" test. This test is derived from the language of Code
? 65.2-309(A), noted above, which recognizes the right of
an injured worker to maintain a common law action for personal
injury against an "other party." This is the test we
applied in Whalen, supra, after we ruled that the
"normal work" test is inapplicable when an employee of
a general contractor makes a personal injury claim against a
subcontractor.

The worker in Whalen, a carpenter
employed by the general contractor on a construction project, was
engaged with a crew in fabricating wooden forms into which
concrete would be poured. The crew was also responsible for
installing reinforcing steel and pouring concrete into the forms,
then setting anchor bolts in the concrete, to which vertical
steel columns would later be attached. At the time the worker was
injured, his crew was working at the construction site
simultaneously with the crew of a subcontractor engaged to do the
steel erection work. The subcontractor had stored a steel girder
at the site, which fell over and injured the worker. He brought a
tort action against the subcontractor.

In Whalen, applying the "stranger
to the work" test, we held that the worker’s action was
barred. 229 Va. at 169, 327 S.E.2d at 105. We stated that the
steel subcontractor "was no stranger to the work in which
[the worker's] employer was engaged
, but was, on the
contrary, performing an essential part of it." Id.
(Emphasis added.)

As noted in Whalen:

"The test to be applied in the present
case was first stated in Feitig v. Chalkley, 185 Va. 96,
38 S.E.2d 73 (1946). There we said that in order to maintain a
common law action the defendant had to be a stranger to the
trade, occupation, or business in which the plaintiff was
involved. This test has been restated and applied numerous times.
See, e.g., Stout v. Onorati, 221 Va. 143,
267 S.E.2d 154 (1980); Bosher v. Jamerson, 207 Va. 539,
151 S.E.2d 375 (1966); Rea, Adminstratrix v. Ford, 198 Va.
712, 96 S.E.2d 92 (1957); Sykes v. Stone & Webster Eng.
Corp.
, 186 Va. 116, 41 S.E.2d 469 (1947)."

229 Va. at 167, 327 S.E.2d at 104 (quoting Stewart
v. Bass
, supra, 223 Va. at 365, 288 S.E.2d at 490)
(employee of pulp manufacturer, injured by a crane while removing
for repair an aerator used in manufacturing process, barred under
the "stranger to the work" test from maintaining
personal injury action against owner of crane who regularly
assisted manufacturer in removal of aerators). See also
Williams v. E. T. Gresham Co., 201 Va. 457, 111 S.E.2d 498
(1959) (employee of ferry district injured while repairing dock
facilities barred from maintaining personal injury action against
owner of pile driving equipment regularly engaged to assist in
such work).

We said in Feitig v. Chalkley:

The remedies afforded the employee under the
act are exclusive of all his former remedies within the field of the
particular business
, but the act does not extend to accidents
caused by strangers to the business. If the employee is
performing the duties of his employer and is injured by a
stranger to the business, the compensation prescribed by the act
is available to him, but that does not relieve the stranger of
his full liability for the loss . . . .

185 Va. at 102, 38 S.E.2d at 75-76 (emphasis
added).

We think the "stranger to the work"
test applied in Whalen is the appropriate test for
application to the present case. Although the injured worker in Whalen
was the employee of a general contractor while the employee of an
owner is the injured claimant in this instance, the latter stands
on at least an equal legal footing with the former.

Here, combining the language in Whalen
and Feitig and applying the holdings to this case, we find
that "the work in which [Stone's] employer was engaged"
was Ford’s "particular business" of manufacturing and
selling motor vehicles. The defendants were strangers to that
business. Therefore, the Act does not bar Stone’s common law
action for personal injuries against the defendants.

However, we would reach the same result even if
we applied the "normal work" test. Although Ford
engaged in a protracted period of intensive planning for the
construction project and exercised a degree of supervision in the
course of construction, this is not atypical conduct for an
owner, especially one engaged in an undertaking of the scope and
size of the PN96 Body Shop Project. And it is not unusual for an
owner to make changes as a project progresses, as Ford did here
when it "recommended" a relocation of the outside
inductive loop.

Nor do we think it is of significance that Ford
itself corrected the location of the interior inductive loop
after Stone was injured. This action may have been prompted by
Ford’s concern for the safety of its employees and its
unwillingness to trust the correction to others.

With respect to design work, it is true that
Ford previously used its own personnel to do the design work for
construction projects and still does on "smaller
. . . or mid-sized projects." However, "on a
major project like [the PN96 Body Shop]," Ford "use[s] the outside help such as [Gala]," which works "with
Ford Motor Company exclusively."
[7]

Furthermore, while Ford employs a sizeable
number of skilled tradesmen on a permanent basis, the evidence
shows that these tradesmen "are mainly concerned with
maintenance." Although, in certain instances, they
"build things as well," including vertical lift doors
similar to the one that caused Stone’s injury, we consider it
significant that "plant forces" performed "no
construction phase" of the PN96 Body Shop Project.

The "magnitude of the job" determines
whether Ford does the work with its own employees or engages
outside contractors. If the magnitude of the job is greater than
Ford’s employees can accomplish or if the cost of a job
exceeds one million dollars, outside contractors are engaged to
do the work. The renovation project in question was the type of
"major work" that Ford "historically contracted
out." In other words, Ford’s normal work indisputably did
not include in-house performance of projects of the scope and
size of the PN96 Body Shop Project. While the magnitude of the
project is not conclusive, it is entitled to consideration in
determining whether the construction of the project was the
normal work of Ford and in reaching the conclusion that it was
not.

For the foregoing reasons, we will reverse the
judgment of the trial court, reinstate Stone’s motion for
judgment, and remand the case for further proceedings.

Reversed and remanded.

FOOTNOTES:

[1] Rudolph/Libbe states in a
memorandum found in the appendix that "[i]t is uncontested
[Stone] in this matter has been paid benefits pursuant to the
Virginia Workers’ Compensation Act." This fact is not
otherwise disclosed in the record.

[2] Rudolph/Libbe states on brief
that the body shop was a $25 million phase "of the total
$125 million project."

[3] Code ? 65.2-307 was amended
in 1999 to add a new paragraph, inapplicable here. 1999 Va. Acts
ch. 842.

[4] Two cases decided since Shell
Oil
, Williams v. E. T. Gresham Co., 201 Va. 457, 111
S.E.2d 498 (1959), and Stewart v. Bass, 223 Va. 363, 288
S.E.2d 489 (1982), involved claims by an employee of an owner but
the "normal work" test is not mentioned in either
opinion. Both were decided under the "stranger to the
work" test, discussed infra.

[5] The reference in the quotation to
"the statute" is to Code ? 65.2-302(B), which
specifies when a general contractor becomes a statutory employer,
making him liable for compensation under the Workers’
Compensation Act for a worker’s injury or death.

[6] Rudolph/Libbe cites Evans v.
Hook
, 239 Va. 127, 387 S.E.2d 777 (1990), as
"instructive on [the] issue" whether "Ford
subcontracted out a fraction of the PN-96 Project to
Rudolph/Libbe and the other defendants herein."
Rudolph/Libbe says that "[i]n Evans, this Court found
that a contractor building a building to be used as a used car
dealership was in the same business trade or occupation as the
used car dealer." Rudolph/Libbe misreads the case. The
owners in that case were not in a used car dealership but a
partnership formed for the purpose of acquiring, owning, and
developing a tract of land on which it planned to construct a
building "to rent to a car dealer." Id. at 129,
387 S.E.2d at 777. An employee of a contractor engaged to
construct the building was injured during the course of
construction and sued the masonry subcontractor and the architect
who designed the building and supervised the construction. The
trial court sustained pleas to the jurisdiction. The employee
appealed only the judgment in favor of the architect. We
affirmed. Contrary to the way Rudolph/Libbe reads the case, we
did not find that the architect was "in the same business
trade or occupation as the used car dealer" but that he was
engaged in the same "business or project" as the owners
of the property, i.e., land development. Id. at
131, 387 S.E.2d at 779.

[7] Although Gala may work "with Ford Motor Company
exclusively," Gala is not Ford’s exclusive designer on
major projects. Gala states on brief that "[o]nly for
‘larger’ projects like the PN-96 Project does Ford
‘outsource’ some of the design work to
Gala." (Emphasis added.) Even then, Gala apparently has to
bid on the design work, like anyone else.

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