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Employers can have 'dual persona' that trumps exclusive remedy: Court

Employers can have 'dual persona' that trumps exclusive remedy: Court

South Carolina employers that acquire other companies could be sued for tort claims under the state's workers compensation law if they assume third-party liabilities in a merger, the South Carolina Supreme Court said Wednesday.

The high court held that workers comp is the exclusive remedy for injured workers in South Carolina. But it unanimously ruled that some employers can have a "dual persona" based on liabilities that are taken on from predecessor companies during mergers and acquisitions.

In Suzanne Roerig Mendenall v. Anderson Hardwood Floors L.L.C. et al., Walterboro, S.C.-based Walterboro Veneer Co. Inc. operated a wood product manufacturing plant in South Carolina's Colleton County. The company installed a cement vat that was used for soaking hardwood logs in a "highly heated" solution before milling, according to court records.

Through a series of mergers, Walterboro Veneer and the Colleton County plant became part of Clinton, S.C.-based Anderson Hardwood Floors, and Anderson assumed all of Walterboro Veneer's liabilities, court records show.

In January 2008, Everette Mendenall fell into a vat while working at the Colleton County plant, which then belonged to Anderson, records show. Mr. Mendenall suffered severe burns on 90% of his body, and he eventually died from his injuries.

Mr. Mendenall's wife received workers comp benefits in relation to her husband's death, records show. She also filed a wrongful death suit against Walterboro Veneer, Anderson and other companies that previously had merged with Walterboro.


The defendants argued that workers comp was the exclusive remedy for Mr. Mendenall's death. However, Ms. Mendenall contended that Walterboro was a third-party defendant because it designed and constructed the vat, but never employed her husband.

She also argued that Walterboro's alleged third-party liability ultimately would have been assumed by Anderson, giving Anderson a dual persona as Mr. Mendenall's employer and the successor to Walterboro's liabilities, records show.

In Wednesday's ruling, the state Supreme Court said employers can have a dual persona that allows them to be sued for negligence outside of workers comp law, but only if the tort claims are "entirely independent of the defendant's obligations as an employer."

The high court did not rule whether the dual persona doctrine applies in Ms. Mendenall's case. That issue is to be decided by the U.S. District Court in South Carolina, where the case is being heard.