Michael v. Denbeste Transportation, Inc. California Court of Appeal, Second Appellate District

By Robert T. Sturgeon

Defendant Denbeste Transportation, Inc. hired plaintiffDavid Michael as an independent contractor to haul hazardous waste from a construction site. Michael was injured when he fell from his truck while attempting to roll a tarp over the top of the trailer to cover the load. Michael sued various parties for his injuries, including Denbeste; Chemical Waste Management, Inc. (“CWM”), the party that had hired Denbeste; Aman Environmental Construction, Inc. (“Aman”), the general contractor on the project and the party who had hired CWM; and Secor International, Inc. (“Secor”), a consultant to the project owner. Michael alleged the defendants owed him a duty of care under the peculiar risk doctrine, which provides that a party who hires a contractor to perform inherently dangerous activities can be held vicariously liable for tort damages when the contractor’s negligence causes injury to others. Michael alleged the defendants had breached their duty by not providing fall protection while he was covering the load.

Defendants Aman, CWM, and Secor moved for summary judgment on the ground that Michael’s claims against them were barred by the Privette doctrine. In Privette v. Superior Court, 5 Cal. App. 4th 689 (1993), the California Supreme Court held that a party who hires an independent contractor to perform an inherently dangerous activity is not vicariously liable under the peculiar risk doctrine to employees of the independent contractor who are injured by the contractor’s negligence. The Privette court reasoned that employees injured in the course of employment can recover for their injuries under the worker’s compensation system, and therefore imposing liability on a non-negligent hiring party “advances no societal interest that is not already served by the worker’s compensation system.” Privette, 5 Cal. 4th at 692. Subsequent to Privette, the Supreme Court has held that “a hirer of an independent contractor is not liable to an employee of the contractor merely because the hirer retained control over the safety conditions at a worksite, but . . . a hirer is liable to an employee of a contractor insofar as a hirer’s exercise of retained control affirmatively contributed to the employee’s injury.” Hooker v. Department of Transportation, 27 Cal. 4th 198, 202 (2002). For example, a hiring party may be liable to an employee of the contractor when the hirer promises to provide a safety particular safety measure but negligently fails to do so, or when the hirer is a landowner who knows of a concealed hazardous condition on the land that the contractor has no reason to know of, but fails to disclose the hazard to the contractor. See Hooker, 27 Cal. 4th at 212 n. 3; Kinsman v. Unocal Corp., 37 Cal. 4th 659 (2005).

Michael v. Denbeste is the first published case to address whether Privette applies not only to employees of the contractor, but also to independent contractors hired by the contractor. In Michael, plaintiff contended that Privette and its reasoning did not apply to his claims because he was an independent contractor of Denbeste, not an employee, and thus had no access to Denbeste’s worker’s compensation insurance. The Court of Appeal disagreed, and held that the Privette doctrine extends to independent contractors hired by the contractor.

In support of its decision, the court first noted that “any lack of insurance coverage is not dispositive in determining the application of the Privette doctrine.” See Lopez v. C.G.M. Development, Inc., 101 Cal.App.4th 430 (2002) (holding that hiring party was not liable to employee of contractor under Privette notwithstanding that the contractor had failed to obtain worker’s compensation insurance).

The court further explained that extending the doctrine to independent contractors was consistent with both common law principles of hirer liability, and “the strong public policy in favor of delegation by hirers.” The court noted that at common law, because a party that hired an independent contractor generally had “no right of control as to the mode of doing the work contracted for,” the hiring party was generally not held liable for the acts of the contractor it hired. Further, the contractor is generally in a better position to take precautions against injuries to its personnel than the party that hired it, and may include the cost of taking safety precautions in its contract with the hiring party. As such, the court held, it is reasonable for the hiring party to anticipate that the contractor will be responsible for its workers’ safety, and it is “reasonable to exonerate the hirer of the independent contractor from liability” on that basis.  The court further noted that as a matter of law, a hiring party has no duty to ensure that the contractor it hires obtains worker’s compensation insurance. See Lopez v. C.G.M. Development, Inc., 101 Cal. App. 4th at 444-445. Accordingly, the court held, a hiring party should likewise have no duty to ascertain whether the persons performing work for the contractor are employees or independent contractors.

The court concluded that in this case, when Aman and CWM hired Denbeste to work on the project, they were entitled to anticipate that Denbeste would insure against injury to its personnel, and would do so regardless or whether the persons working for it were employees or independent contractors. As the court stated, “there is no reason why Aman and CWM responsibilities to [Michael as an independent contractor] should be any greater than their responsibilities to other workers who are Denbeste employees.”

Applying the Privette doctrine to Michael’s claims, the court found that Aman and CWM had delegated responsibility for worker safety to Denbeste, and that there was no evidence that Aman or CWM had exercised retained control over worksite safety in a manner that affirmatively contributed to Michael’s injury. Accordingly, the court held that Michael’s claims against them were barred by Privette.  Similarly, the court held that Michael’s claims against the owner’s agent, Secor, were barred because (i) the owner and its agents are considered hiring parties under Privette as a matter of law, and (ii)  the absence of fall protection was not a concealed hazardous condition, and there was no evidence that Secor actually exercised any retained control in a manner that affirmatively contributed to Michael’s injuries.

Michael has petitioned the California Supreme Court for review. The Supreme Court has not yet ruled on whether it will take up the case.

For more information please contact Robert Sturgeon.  Robert Sturgeon is a senior attorney in the Construction, Environmental, Real Estate and Land Use Litigation practice group in the firm’s Los Angeles office.