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IN THE TERRITORIAL COURT OF THE VIRGIN ISLANDS DIVISION OF ST. THOMAS AND ST. JOHN FRANKLIN HARRIS, Plaintiff CIVIL NO. 249/1982 Vs. ACTION FOR PERSONAL INJURY NO. 1 CONTRACTING CORP. EX- CAVATION CONSTRUCTION CO. dba A Joint Venture Holding Itself Out as E.C. No. 1, and § & C CORPORATION, Defendants S & C CORPORATION, Third Party Plaintiff See Set Stet eet Sree et Salt Seether Sere ewe Seu ae ne Se eh CIVIL NO. /1984 vs. ACTION FOR BREACH OF WAR- RANTY GENERAL TIRE & RUBBER COMPANY, ) Third Party Defendant ) ETHEL CARR HUNTER MITCHELL, Esquire Attorney at Law Dronningens Gade St. Thomas, V.I., 00801 ATTORNEY FOR PLAINTIFF JAMES L. HYMES, III, Esquire Attorney at Law No. 10 Norre Gade St. Thomas, V.I., 00801 ATTORNEY FOR E.C. No. 1 GEORGE MARSHALL MILLER, Esquire Attorney at Law No. 6 Kongens Gade St. Thomas, V.1I., 00801 ATTORNEY FOR S & C CORPORATION JOEL W. MARSH, Esquire Attorney at Law No. 40 Norre Gade St. Thomas, V.I., 00801 ATTORNEY FOR GENERAL TIRE & RUBBER CO. CHRISTIAN, ALPHONSO A., Senior Sitting Judge MEMORANDUM OPINION January 21, 1986 I. INTRODUCTION Before the Court are two motions for disposition, one by defendant No. 1 Contracting Corp. Excavation Construction Com- HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION ~ PAGE 2 pany dba A Joint Venture Holding Itself Out as E.C. No. 1 ("E.C.-1"), for Summary Judgment; and the second by Third Party Defendant, General Tire and Rubber Company ("General Tire"), to Compel Answers to Interrogatories and Response to Demand for Production directed to Co-Defendant and Third Party Plain- tiff Sac Corporation ("S & C"), and to impose sanctions against S & C pursuant to FRCP 37(d) for excessive tardiness in compliance with FRCP 33. For the reasons appearing below, E.C.-l's Motion for Summary Judgment will be granted, and General Tire's Motion to Compel, etc., now being moot, will be granted only to the extent of the imposition of sanctions. Ii. FACTUAL BACKGROUND On or before July 24, 1981, the Virgin Islands Port Authority ("VIPA") entered into a contract with E.C.-1 to furnish all materials and labor for the construction, develop- ment and expansion of the runway at the Harry S. Truman Air- port, now renamed Cyril E. King Airport. Section 7 of this contract entitled Legal Relations and Responsibility to Public reads in apparent pertinent part: "T. Working conditions. No contractor may require any laborer or mechanic employed in the performance of the con~- tract to work in surroundings or under working conditions that are unsanitary, hazardous, or dangerous to his health or safety as determined under construction safety and health standards (29 CFR Part 1926) HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION - PAGE 3 and other occupational and health standards (29 CFR Part 1910) issued by the Secretary of Labor. "J. Subcontracts. The contrac- tor will insert in each of his subcontracts the clauses con- tained in paragraphs A through K of this provision, and also a Clause requiring the subcon- tractors to include these pro- visions in any lower tier sub- contracts which they may enter into, together with a clause requiring this insertion in any further subcontracts that may in turn be made." (29 CFR 5.5(a) (6), 5.5(c) (4). On July 24, 1981, E.C.-l entered into a subcontract with S & C to haul 1,000,000 tons of earth and shot rock materials on trucks provided and operated by S & C from Sara Hill... to designated dumping areas. The subcontract also provided: "S & C Corporation will provide all equipment, labor, fuel, greases, tires, maintenance, administration, permits, tarpau- lins, and all incidentals to provide the above hauling require- ments." The subcontract required E.C.-1 to "maintain the designated haul roads [over which S & C trucks would travel from pick up to dumping sites], providing a suitable area for S & C Corp. to install an office and maintenance facility." But S & C, in addition to its obligation under the subcontract to provide all equipment, etc., for the performance of the agreement, was required to install and maintain its own office and maintenance facility. Franklin Harris, the plaintiff herein ("Harris") was em- ployed by S & C to repair tires and trucks used by S & C in HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION - PAGE 4 performing its work called for by the subcontract. Plaintiff's Complaint, Paragraph 8. On the 21st of October, 1981, while so employed, a tire on which Harris was working exploded causing him great bodily injury. Said Complaint at Paragraph 9. Harris sued his employer, the independent subcontractor, S &.C, and S & C's employer, E.C.-l1, for compensatory damages in the amount of $50,000.00, and for costs and attorney's fees. There- upon, E.C.-1 filed this Motion for Summary Judgment. What may become a pertinent, and perhaps even a crucial and dispositive factor later in the progress of this litiga- tion is the fact that Harris’ employer, S & C, was not insured pursuant to the requirements of the local Workmen Compensation Act, 24 V.I.C. Sections 251, et seq.; and it is not yet as- certained whether Harris elected to accept workmen compensation coverage and benefits under and by virtue of 24 V.1I.C. Section 261(b) (1), from. the © Uninsured-Employer Cases Fund (261 (a) (2), which election could operate to bar him from pursuing his common law remedy against S & C provided to work-related injured employees of employers who are uninsured in non-com- pliance with the Workmen Compensation Act. 24 V.I.C. Section 284. But that aspect of the case is not relevant to our dis- position on the instant motion. Til. DISCUSSTON A. MOTION FOR SUMMARY JUDGMENT Summary Judgment is appropriate only in a restricted group of cases where the affidavits, plead- ings, and depositions indicate HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION - PAGE 5 there is no genuine issue as to material fact, and the moving party is entitled to judgment as a matter of law. PRCP 56; Leader v. Merchant's Market, Inc., Civ. No. 80/1982 (D.C.V.I. 1982). Further, Summary Judgment is a drastic remedy, and the Third Circuit has made it clear that any doubts as to the exis- tence of genuine issues of fact are to be resolved against the moving party. Leader, supra, quoting Ness v. Marshall, 660 F2d. 517, 519 (3d Cir. 1981). The Court in reviewing a request for summary judgment must view any inference which can be drawn from the underlying facts in the light most favorable to the party opposing the motion. Leader, supra, quoting Goodman v. Mead Johnson & Co., 534 F2d. 566, 573 (3d Cir. 1976). In the case of Calvert Gibson v. Sullivan Trail Coal Com- pany, et al, Civil No. 1981/354, decided as late as April, 1985, Judge David O'Brien, relying on earlier decisions by Chief Judge Almeric Christian, which ain turn relied on the teaching of Chapter 15 of the Restatements of Torts (Second), Sections 409 throught 429, held that in the U.S. Virgin Islands, an employee of an independent contractor cannot successfully bring an action for damages against the entity which hired the independent con- tractor in the first place. See Munson v. Duval, 11 V.I. 615 (D.V.I. 1975); also Tauscher v. Puget Sound Power & Light Co., 635 P.2d 426, 429 (Wash. S.C. 1981). An elaboration on the rationale for the rule was enunciated HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION - PAGE 6 by Judge O'Brien as follows: Most of the cases which form the overwhelming majority of jurisdictions holding as we do have relied heavily on language which was found in the American Law Institute's Tentative Draft No. 7 as a special note to Chapter 15 of the Restatement of Torts (Second). The language, in pertinent part, is as follows: "(T]he workman's recovery is now, with relatively few excep- tions, regulated by workmen's compensation acts, the theory of which is that the insurance out of which the compensation is to be paid is to be carried by the workman's own employer, and of course premiums are to be calculated on that basis. While the workmen's compensa- tion acts not infrequently pro- vide for third-party liability, it has not been regarded as necessary to impose such lia- bility upon one who hires the contractor, since it is to be expected that the cost of the workmen's compensation insurance will be included by the contrac- tor in his contract price for the work, and so will-in any case ultimately be borne by the defen- dant who hires him." The Gibson court stated ‘the controlling principle of law succinctly: We reaffirm previous case law in this territory [the U.S. Virgin rslands] and hold with the vast majority of jurisdictions that such an employee [an employee of an inde- pendent contractor] is not a part of the protected class for whom an action is available under Chapter 15 of the Restatement of Torts, (Second), Sections 409 through 429." In Mauscher HARRIS vs. NO. 1 CONTRACT AG CORP. et al MEMORANDUM OPINION —- PAGE 7 there is even more light giving further illumination on the law on the subject and the reasons therefor: There are strong policy con- siderations behind limiting an owner's liability to those third parties other than em- ployees of independent contrac- tors. First, the rationale underlying the exception to the rule for non-liability, which is that we did not want an owner shifting his or her liability by hiring an independent contractor to perform a task, is not rele- vant in the case of an employee of an independent contractor. An owner who employs an inde- pendent contractor is already liable to all third persons, including employees of the in- dependent contractor, for his or her own negligence, for negli- gence in the hiring of the in- dependent contractor and for injuries resulting from any latent defects on the land. See Welker v. Kennecott Cooper Co., l Ariz., App. 395, 403 P.2d. 330 (1965); Restatement (Second) of Torts Section 343 (1965). Thus, the law already imposes upon the employer a duty of due care. The employer's liability for damage resulting from the negligence of the independent contractor is limited to third parties largely because the em- ployer has in a sense already assumed financial responsibility for the injuries to the employees in that the contract he or she pays to the independent contractor necessarily includes the costs of the insurance premiums that the independent contractor must pay for workers' compensation coverage. King v. Shelby Rural Electric Co- operative Corp., 502 S.W.2d 659 (Ky. App. 1973); Vagle v. Pickands Mather & Co., 611 F.2d 1212, 1218 HARRIS vs. NG. 1 CONTR CTING CORP. et al MEMORANDUM OPINION -—- PAGE 8 (8th Cir. 1979). The employee already has a remedy; one which the owner has paid for. Secondly, under our workers’ compensation statutory scheme, the employer is released from financial responsibility for on-the-job injuries to his or her employees. To hold an employer liable for injuries to employees of the independent contractor would subject the employer to a greater liability than if the employer had uti- lized his or her own employees. King, at 663; Vagle, at 218; Cochran v. International Har- vester Co., 408 F.Supp. 598, 602- 603 (W.D.Ky. 1975). It should be abundantly clear that the protected class referred to in Munson, and Gibson, and the Restatement, those who have suffered injuries in connection. with the performance of contracts by independent contractors, and who under certain special, exceptional conditions may sue, not only the indepen- dent contractor, but also the person or entity who employed him, also referred to in the Restatements as "others" who may bring such suits, do not include the employees of independent contractors, for they already have their remedy under Workmen Compensation, or where that was not provided to them as re- quired by the Workmen Compensation Act, at common law. On the other hand, persons who are not employees of independent con- tractors and thus who do not have recourse to the remedies offered by either the Workmen Compensation Act, under regular coverage, or by virtue of its special Uninsured-Employer Cases Fund, created to provide a quick remedy for work-related in- HARRIS vs. NO. 1 CONTRACTING CORP. et al MEMORANDUM OPINION - PAGE 9 ad jured employees of uninsured employers (24 V.I.C. 261(a) (1), where taken advantage of, or under the common law, invariably have a remedy against the independent contractor, and in special, exceptional cases, according to the Tauscher case, supra, as where the employer of the contractor was himself negligent, or negligent in hiring the independent contractor, or for injuries resulting from latent defects, against the person who hired the independent contractor as well. Clearly, in all such cases, the injured employee of the independent contractor already has his remedy, if not under workmen compen- | sation, at common law, against his immediate employer, the independent contractor. This is fair and just especially where, as here, the employer of the subcontractor retained no control over his operations in which plaintiff was injured. Applying the above principles to the facts of this case, especially in the light that we are obligated to view them in the disposition of this type of motion, there is no dispute | about the fact that ‘Ss & C was an independent subcontractor; that E.C. “1 retained and exercised ‘no control over 8 & C operations; ‘that Harris was: an employee of S & C7; or that he was injured ; while working for S a | | If the. points made by Harris in his opposition to. E. SC.el! s- Motion for Summary Judgment , ‘including his citation of Section ir 411 of the Restatement of Torts (Second), and Comment a thereof, and his Statement [List] of Genuine Issues re Motion for Sum- mary Judgment, referred to a claim for damages by a third person, "others" completely discrete from an "employee of an HARRIS vs. NO. 1 CONTRACTING CORP, et al MEMORANDUM OPINION ~ PAGE 10 te independent _ subcontractor", which he was, then there would unquestionably exist issues of material fact to be tried, and the granting of a “Motion for Summary Judgment would be wholly inappropriate. In the Light of the above principles of ‘law, we hold that Harris reliance and basis for contending that there are genuine. issues of material’ fact to be tried are misplaced, and therefore are entirely without merit. As for. the provisions: of Section 7 of the prime contract | between VIPA and E. Cc. “1, those provisions are no more than part | of the package of mutual, reciprocal rights and responsibilities created by the parties to that contract, and which they, and only they, have legal standing to invoke and rely upon in any ensuing litigation... B. MOTION TO COMPEL ANSWERS _'T0_ INTERROGATORIES, etc. 5 late as guly 30, “1985, General ‘Tire filed a | Motion to Compel_ Answers to ‘Interrogatories and Response to. Demand for Production and for the imposition of. ~ sanctions pursuant to Rule 37a) of ‘the Federal Rules of cava : procedure, which provides as follows: HARRIS vs NO CONTRACTING CORP et al MEMORANDUM ailure of Party to Attend t Own Deposition or Serve nswers to Interrogatories or Respond to Request _ for Inspection. I a party or an office director, or managing agent of a party or a person desig- nated under Rule 30(b) (6) or 3 (a) to testify on behalf of a party fails (1) to appear before the officer who is to take his deposition, after being served with a proper notice, or (2) to serve answers or objections to interrogatories submitted under Rule 33 after proper service of the interro- gatories, or (3) to Serve a itten response: to ae request spection. submitted under ter. roper service he rbtoin he ctios s pending ma. st heor- ailu jus an mong other ak na utho- aragra (A), (8), an “Of subdivision ‘(b) (2) > of thi ‘rule. In- ‘lieu. of any order rou addition ‘thereto, the court shall require the party failing to act or the attorney advising. him or-both the “reasonable expenses ,- a cluding. attorney! s fees, caused failure, unless the court. at the ailu; was sub- tant lyoju ed r that other Gircumstances mal} ean ‘award ex i es unj S & Fag n-Decem ar 12 198 Cc ‘Filed its ‘respons ‘Notwithstanding th ek: tha id espond .t ene ire's First of Tnt ogatories and and or Productio of Documents, the Court is satisfied that there. is. no Bcceptable justification for the inord ate “passage of tine, approxinately | ARRI NTRACTING CORP et al EMORANDU six months, before said response was filed; therefore, pursuant to Rule 37(d) noted supra, General Tire, based on its affidavit of costs, filed on July 30, 1985, will be awarded $160.00 for attorney's fees incurred in filing its motion to compel due to S & C's untimely response in this matter. ~ Cé ae wh OY ke teenth es AEBHONSO A. CHRISTIAN, itting Judge. iola th