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A $43.5 million jury award in a personal injury lawsuit against a subcontractor was overturned Thursday by a Texas appeals court, which found that workers compensation was the injured employee’s exclusive remedy.
In 2013, Tyler Lee was a superintendent for a general contractor on a large-scale construction site in Houston where Bonner Springs, Kansas-based Berkel & Company Contractors Inc. was a subcontractor, according to court records in Berkel & Company Contractors Inc. vs. Tyler Lee and Leigh Ann Lee.
While drilling a piling on the site, an auger operated by Berkel became stuck. Berkel’s superintendent, Chris Miller, allegedly ordered different maneuvers to free the auger despite objections from both a foreman and a crane operator, who raised safety concerns. The two men alerted Mr. Miller that attempts to hoist the auger with the crane were causing the crane to become overloaded and tip, according to court documents.
Under continued strain from trying to hoist the auger, the crane’s boom bowed and bent, eventually snapping in half and crashing to the ground, court records show. Leads attached to the crane toppled to one side, striking Mr. Lee, who was situated a distance away from the crane behind a barricade. The leads landed on Mr. Lee’s left leg, crushing it and severing it below the knee, according to court records.
Mr. Lee recovered workers comp through his employer, Parsippany, New Jersey-based Skanska USA Building Inc., but sued Berkel in district court in Brazoria County, Texas, seeking additional recovery based on allegations of negligence, gross negligence and intentional injury. A jury ruled in favor of Mr. Lee in 2015, and the court awarded him $35 million in actual damages and $8.5 million in exemplary damages based on the court’s finding of gross negligence on Berkel’s part. Berkel appealed to the 14th Court of Appeals in Austin.
A three-judge panel of the appeals court overturned the jury decision and award, finding workers comp was Mr. Lee’s exclusive remedy.
The court determined that Berkel had the right to claim exclusive remedy protection even though it was not Mr. Lee’s employer because Skanska had agreed to provide workers comp insurance to all subcontractors and their employees through a contractor-controlled insurance program. Thus, Skanska was Berkel’s statutory employer and Mr. Lee was Berkel’s statutory co-employee, the panel said.
The court ruled that Mr. Miller was operating as a vice principal of Berkel and that his actions could be imputed to Berkel for liability purposes if the substantial certainty exception to the Texas Workers’ Compensation Act could be proven, which would require evidence that Mr. Miller had substantial certainty that his actions would cause injury.
The “evidence easily supports a finding that Miller was reckless, but it does not support a finding that Miller was substantially certain that Lee would be a particular victim of Miller’s conduct. To make that greater finding, there must have been some evidence that Miller at least knew of Lee’s location. … But there is none.”
Mr. Lee alleged that that Mr. Miller knew that his actions were substantially certain to bring about harm to potential victims in a localized area. The court, however, rejected this theory, saying Mr. Lee had outlined an area of danger — the fall radius of the crane — where an injury was foreseeable but not substantially certain.
“The flaw in Lee’s argument is that it equates the probability of a fall with the probability of an injury,” the panel said. “Miller could only be substantially certain of an injury if he knew that the leads would contact a person, and to establish that knowledge, Miller would have to know the fall path of the leads.”
“Because there is no basis on which the claimant’s recovery of common law damages can be sustained, we must reverse and render judgment that the claimant take nothing on his claims against the subcontractor,” the court concluded.
Houston-based law firm Wright & Close L.L.P., which represented Berkel, said the decision was a “major victory” and serves to clarify what evidence and intent are required to allow an injured worker to be exempted from the Texas Workers’ Compensation Act.
“In its very thorough opinion, the appellate court found that ‘intentional injury’ requires an intent to injure a particular person or a small class of people, not just a general knowledge that an activity is dangerous,” said Thomas C. Wright, a partner at the firm, in a statement. “Many plaintiffs attempt this way around the Workers’ Compensation Act, and this case should bring some clarity to the law.”