Low, Ball & Lynch’s

WEEKLY LAW RESUME

December 29, 2005 Issue   By: Ray Coates

Duty of Care - Landowner - Independent Contractor’s Employees

Ray Kinsman v. Unocal Corporation

 (December 19, 2005)

California Supreme Court

The Supreme Court has been defining over the last dozen years the circumstances of when an employee of an independent contractor, who has been injured on the job, may sue the hirer of that contractor.  This case addressed the issue of when a landowner that hires an independent contractor is liable to an employee of the contractor who was injured as a result of hazardous conditions on the landowner’s premises.

During the 1950's, Ray Kinsman worked on many occasions as a carpenter at Unocal’s refinery.  Mr. Kinsman was employed by Burke & Reynolds, an independent contractor, who was by hired by Unocal to perform scaffolding work during periods of shutdown and repair at the refinery.  Mr. Kinsman built and dismantled scaffolds used by other trades.  He was exposed to airborne asbestos, which was produced by the other trades.  Years later, Mr. Kinsman developed mesothelioma.  He sued product manufacturers and distributors as well as premises owners, such as Unocal.  At trial, Mr. Kinsman argued that Unocal should have warned his employer of the dangers of the exposure to asbestos dust.  Unocal defended that it complied with industry standards in providing protection to those it considered exposed to unsafe concentrations of asbestos dust.  The jury awarded Mr. Kinsman $3,000,000 in compensatory damages against Unocal.

Unocal appealed, contending the decision violated court decisions concerning the duties of a landowner to an independent contractor’s employees.  The Court of Appeal reversed and remanded the case for a new trial.  The Supreme Court granted review.

       
In an unanimous Supreme Court decision, the reversal by the Court of Appeal was affirmed.  The Supreme Court reviewed all of the cases dealing with the duties of a landowner to an employee of an independent contractor.  The court decisions have held that an employee cannot recover under a premises liability theory unless the landowner affirmatively contributed to the employee’s injury.  The Court noted that when a landowner hires an independent contractor, generally he delegates to the independent contractor responsibility for supervising the job, including looking after the employees’ safety.  This includes taking proper precaution to protect against obvious hazards in the workplace.  The Court applied that reasoning to this case.  Where there is a known safety hazard on a hirer’s premises that can be addressed through reasonable safety precautions on the part of the independent contractor, the hirer has delegated responsibility to take such precautions to the contractor, and thus is not liable to the contractor’s employee if the contractor fails to do so.  The Court found no reason why that rule should not exist in a situation such as presented by the Unocal case. 

If the hazard was concealed from the contractor, but known to the landowner, the Court stated that a different rule would apply.  The landowner cannot delegate to the contractor responsibility for the safety of the contractor’s employees because the landowner failed to disclose critical information needed to fulfill that responsibility.  In that situation, the landowner would remain liable to the contractor’s employee if the employee is injured by the undisclosed hazard.  Thus, the hirer, as landowner, could be independently liable to the contractor’s employee, even if it does not retain control over the work, if it knows, or reasonably should know, of a concealed pre-existing hazardous condition on its premises and the contractor does not know or could not reasonably ascertain the condition, and the landowner fails to warn the independent contractor.  The Court stated that a landowner would not be liable when the contractor failed to inspect the premises for concealed conditions.  Further, a landowner who does not retain control of the property is not liable for an injury inflicted by an independent contractor or its employees on the employee of another independent contractor.

In the trial court, a jury instruction had been given which imposed liability on Unocal if it was found to be negligent in the management of their property.  The instruction did not make clear that the hazard had to be unknown and not reasonably ascertainable by the independent contractor that employed Ray Kinsman.  Thus, the jury was improperly instructed.  The Court concluded that the instruction was prejudicial.  The jury made no finding about whether Mr. Kinsman’s employer or another contractor working at the site knew or should have known of the hazard, or whether Unocal knew or should have been aware that these contractors did not know of the hazard.  A finding that these contractors did know of the hazard would relieve Unocal of liability.  The decision as to whether a hazard was concealed was a factual matter.  The Court concluded that a properly instructed jury could have concluded that Unocal was not liable because the contractors knew, or should have known, of the hazard. 

Therefore, the decision was reversed and remanded to the Court of Appeal for further proceedings consistent with the opinion.

COMMENT

This is further refinement of the Privette rule, which sets a high standard for imposing liability on landowners for concealed hazards which cause injury to an independent contractor’s employee.

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