Title: Rodriguez v. Leesburg Bus. Park, LLC
Citation: N/A
Docket Number: 122029
State: Virginia
Issuer: Virginia Supreme Court
Date: February 27, 2014

Present:  All the Justices 
 
CECILIA RODRIGUEZ, ADMINISTRATOR 
OF THE ESTATE OF UBALDO RODRIGUEZ 
 
 
 
 
 
 
 
 OPINION BY  
v. 
Record No. 122029 
  
   CHIEF JUSTICE CYNTHIA D. KINSER 
 
 
 
 
 
 
 
   FEBRUARY 27, 2014 
LEESBURG BUSINESS PARK, LLC, ET AL. 
 
FROM THE CIRCUIT COURT OF LOUDOUN COUNTY 
James H. Chamblin, Judge 
 
 
The circuit court sustained a plea in bar and dismissed 
this wrongful death action on the basis that the plaintiff's 
exclusive remedy is under the Virginia Workers' Compensation Act 
(the Act), Code §§ 65.2-100 through -1310.  The primary issue is 
whether an employee of a general contractor, hired by an owner 
to construct warehouse buildings, was engaged in the "trade, 
business or occupation" of the owner under Code § 65.2-302(A) 
when the employee suffered fatal injuries in the course of 
employment.  We conclude that the employee's work at the time of 
the accident was not part of the owner's trade, business, or 
occupation and will therefore reverse the circuit court's 
judgment. 
FACTS AND PROCEEDINGS 
 
Leesburg Business Park, LLC (LBP) contracted with E.E. Reed 
Construction, LP (Reed) to construct warehouse buildings on a 
parcel of undeveloped land owned by LBP and known as Leesburg 
Business Park (Park).  Ubaldo Rodriguez (Ubaldo) was an employee 
of Reed.  Ubaldo was fatally electrocuted when building 
2 
materials being moved by another Reed employee came into contact 
with overhead electrical power lines.  The Virginia Workers' 
Compensation Commission entered an award of benefits to Ubaldo's 
statutory beneficiaries under the Act. 
Cecilia Rodriguez (Rodriguez) is the widow of Ubaldo and 
the administrator of his estate.  In her capacity as 
administrator, Rodriguez filed a wrongful death action under 
Code § 8.01-50, alleging that LBP caused Ubaldo's death by 
negligently failing to keep its premises reasonably safe for 
invitees such as Ubaldo.1  LBP filed a plea in bar, arguing that 
Ubaldo was the "statutory co-employee of LBP under [the Act]," 
and therefore Rodriguez' claim was barred by Code § 65.2-307. 
At an evidentiary hearing on the plea in bar, the circuit 
court heard testimony from William H. Lauer, LBP's initial 
manager and sole member.  LBP, Lauer testified, is a "single 
source" entity, with no employees, which was created to own and 
develop a parcel of real estate and then lease or sell 
warehouses constructed on the parcel.  LBP's operating agreement 
states that it was "formed for the purposes of acquiring, 
holding, improving, managing, leasing and selling real property 
in Virginia and elsewhere, and engaging in any other business 
agreed to by the members of the LLC and permitted under the laws 
                         
1 Rodriguez named other entities as defendants in the 
amended complaint, but they are not parties to this appeal. 
3 
of the Commonwealth of Virginia."  Lauer described LBP's 
operation as follows: "[A]s owner and developer, we create the 
opportunity, we build it, we sell it, we lease it, and we manage 
it."  After purchasing the property through a separate entity 
and determining that the property was "worthy of development," 
Lauer formed LBP and assigned the purchase contract to LBP.  
LBP, through contracts with other entities, then determined the 
feasibility of development and conducted various preliminary 
steps to enable development of the land.  Those steps included 
architectural, engineering, legal, and financing work. 
After considering a number of general contractors, LBP 
contracted with Reed to construct warehouse buildings on the 
property.  Reed was "solely responsible for doing all of the 
components to build the building" and was "fully in charge" of 
construction.  Under its contract with LBP, Reed was not 
responsible for obtaining building permits, paying utility fees, 
"[m]oving . . . the power lines," or providing "signage for the 
project."  These responsibilities, and the responsibility of 
overseeing the construction process to ensure the work was done 
properly and according to specifications, were contracted to a 
consultant, or "owner's rep[resentative]."  LBP had no role in 
the actual construction of the buildings.  As Lauer stated, it 
did not "move earth[,] lay any rebar[,] pour any concrete [or] 
4 
install windows, plumbing [or] electrical."  LBP made its money 
from the sale and lease of the warehouses. 
The circuit court found that "LBP was in the trade, 
business or occupation of purchasing, developing, constructing, 
selling and leasing warehouse buildings on" its parcel.  
"[C]onstruction of the warehouses," the court stated, "was a 
part of the trade, business or occupation of LBP."  Accordingly, 
the court concluded that Ubaldo "was a statutory co-employee of 
LBP" and that Rodriguez' recovery was limited to the Act.  On 
August 10, 2010, the court entered an order sustaining the plea 
in bar and dismissing the amended complaint with prejudice. 
We awarded Rodriguez an appeal.  In an unpublished order, 
we held there was no evidence that Ubaldo and LBP were statutory 
co-employees.  Rodriguez v. Leesburg Business Park, LLC, Record 
No. 102127, slip op. at 4 (Jan. 6, 2012) (per curiam) 
(unpublished).  We noted that the term "statutory co-employee" 
is "not synonymous with the term 'statutory employee' as 
contemplated under Code § 65.2-302(A) in the context of the 
relationship between an alleged statutory employee and statutory 
employer."  Id.  We reversed the judgment of the circuit court 
and remanded the case for further proceedings.  Id. 
On remand, LBP moved to reconsider its plea in bar based on 
the evidence presented at the original hearing.  LBP argued that 
the evidence established it was Ubaldo's statutory employer and 
5 
that Rodriguez' action against LBP was barred by the exclusivity 
provision under Code § 65.2-307(A).  Rodriguez objected that the 
circuit court could not reconsider its ruling on the plea in bar 
because more than 21 days had elapsed since the court entered 
its order sustaining the plea and awarding final judgment.  
Thus, according to Rodriguez, Rule 1:1 divested the court of 
jurisdiction to modify its order.  She also argued that the 
evidence did not establish that LBP was Ubaldo's statutory 
employer. 
At a hearing, the circuit court first rejected Rodriguez' 
argument concerning Rule 1:1 and its jurisdiction to reconsider 
the plea in bar.  The court then again found that LBP "was in 
the trade, business or occupation of purchasing, developing, 
constructing, selling and leasing warehouse buildings on" its 
parcel, and "the construction of the warehouses was a part of 
the trade, business or occupation of LBP."  The court concluded 
that "LBP was the statutory employer of Ubaldo and that 
[Rodriguez'] recovery is limited to Workers' Compensation 
benefits only."  It entered an order sustaining the plea in bar 
and dismissing the amended complaint with prejudice. 
We awarded Rodriguez this appeal. 
ANALYSIS 
 
The primary issue on appeal is whether at the time of his 
fatal accident, Ubaldo was engaged in work that was part of 
6 
LBP's trade, business, or occupation, thus making LBP Ubaldo's 
statutory employer under Code § 65.2-302(A).  Determining 
whether work is part of the trade, business, or occupation of an 
owner is a mixed question of law and fact.  Carmody v. F.W. 
Woolworth Co., 234 Va. 198, 201, 361 S.E.2d 128, 130 (1987).  
The Court views the facts and any reasonable inferences raised 
by the evidence in the light most favorable to the prevailing 
party below, LBP, and determines whether the circuit court 
correctly applied the law to those facts.  Id.  Here, because 
the essential facts are undisputed, we are presented only with a 
question of law regarding the circuit court's application of the 
law to those facts and therefore apply a de novo standard of 
review.  See Hilton v. Martin, 275 Va. 176, 180, 654 S.E.2d 572, 
574 (2008). 
 
Answering the question before us "is not a simple, 
straightforward exercise," Henderson v. Central Tel. Co., 233 
Va. 377, 382, 355 S.E.2d 596, 599 (1987); it "depends upon the 
facts and circumstances of the particular case [and] 'does not 
readily yield to categorical or absolute standards.'"  Johnson 
v. Jefferson Nat'l Bank, 244 Va. 482, 485, 422 S.E.2d 778, 780 
(1992) (quoting Bassett Furniture Indus., Inc. v. McReynolds, 
216 Va. 897, 902, 224 S.E.2d 323, 326 (1976)). 
The Act's exclusivity provision, Code § 65.2-307(A), 
mandates that the rights and remedies provided in the Act 
7 
"exclude all other rights and remedies" of a covered employee or 
his beneficiaries for injuries sustained in the course of 
employment.  An employee cannot maintain a common law tort 
action against his employer or a fellow employee for such 
injuries.  Hudson v. Jarrett, 269 Va. 24, 29, 606 S.E.2d 827, 
829 (2005).  Likewise, an employee is barred from bringing such 
an action against a party who is not the employee's common law 
employer if that employer is nevertheless a "statutory employer" 
under Code § 65.2-302(A).  Id. at 29-30, 606 S.E.2d at 
829; cf. Clean Sweep Prof'l Parking Lot Maint., Inc. v. Talley, 
267 Va. 210, 213, 591 S.E.2d 79, 81 (2004) ("The only exception 
to [the] exclusivity provision is provided in Code § 65.2-309(A) 
permitting an action to be maintained against an 'other party.' 
To be an 'other party,' a defendant must have been a stranger to 
the trade, occupation, or business in which the employee was 
engaged when he was injured.") (internal quotation marks 
omitted). 
With the relevant parties from this case interpolated in 
brackets, Code § 65.2-302(A) states: 
When any person (referred to in this section 
as "owner") [LBP] undertakes to perform or 
execute any work which is a part of his 
trade, business or occupation and contracts 
with any other person (referred to in this 
section as "subcontractor") [Reed] for the 
execution or performance by or under such 
subcontractor of the whole or any part of 
the work undertaken by such owner, the owner 
8 
[LBP] shall be liable to pay to any worker 
employed in the work any compensation under 
this title which he would have been liable 
to pay if the worker had been immediately 
employed by him.2 
 
 
The provisions of Code § 65.2-101, however, provide 
that "nothing in [the Act] shall be construed to make the 
employees of any independent contractor the employees of 
the person or corporation employing or contracting with 
such independent contractor."  Thus, in accordance with 
Code § 65.2-101, "the mere fact a business owner engages an 
independent contractor does not make that independent 
contractor's employees statutory employees of the 
owner."  Henderson, 233 Va. at 381, 225 S.E.2d at 598.  
Code § 65.2-302(A), however, makes clear that an owner such 
as LBP can contract out all its work yet remain liable 
under the Act.  Id. 
 
The two statutes read together mean that an owner 
cannot escape liability under the Act by merely contracting 
away work that is part of the owner's trade, business, or 
occupation.  Id. at 381, 225 S.E.2d at 598-99.  "'[I]f the 
work performed by an employee of the contractor or 
subcontractor is part of the owner's trade, business, or 
occupation,'" the owner is the statutory employer of the 
                         
2 Code § 65.2-302(B) and (C) apply the same standard to 
situations in which a contractor contracts with a subcontractor, 
or a subcontractor contracts with another subcontractor. 
9 
employee and "'is liable for compensation as though the 
worker were his own employee.'"  Cinnamon v. IBM Corp., 238 
Va. 471, 478, 384 S.E.2d 618, 621 (1989) (quoting Smith v. 
Horn, 232 Va. 302, 305-06, 351 S.E.2d 14, 16 (1986)).  
However, if the work is not part of the trade, business, or 
occupation of the owner, and the owner hires an independent 
contractor to perform the work, the contractor is liable to 
the employee under the Act, not the owner.  Sykes v. Stone 
& Webster Eng'g Corp., 186 Va. 116, 122, 41 S.E.2d 469, 472 
(1947). 
 
As the Court has stated numerous times, 
[t]he purpose of [Code § 65.2-302] is to 
bring within the operation of the Act all 
persons engaged in work that is a part of 
the trade, business, or occupation of the 
party who undertakes as owner or who 
contracts as contractor to perform the work, 
and to make liable to every employee engaged 
in the work every such owner contractor, or 
subcontractor above such employee. 
 
Pfeifer v. Krauss Constr. Co., 262 Va. 262, 266, 546 S.E.2d 717, 
719 (2001) (internal quotation marks and footnote omitted). 
Under these principles, it is thus necessary to determine 
whether construction was part of LBP's trade, business, or 
occupation.  We begin that analysis by identifying "the nature 
of the particular owner."  Nichols v. VVKR, Inc., 241 Va. 516, 
521, 403 S.E.2d 698, 701 (1991).  Unlike a governmental entity 
or public utility, see Henderson, 233 Va. at 383, 355 S.E.2d at 
10 
599, a private entity, such as LBP, "has broad discretion to 
choose its business activities."  Nichols, 241 Va. at 521, 403 
S.E.2d at 701.  For this reason, the Court has generally applied 
the "normal work test" as enunciated in Shell Oil Co. v. 
Leftwich, 212 Va. 715, 187 S.E.2d 162 (1972): 
[T]he test is not one of whether the 
subcontractor's activity is useful, 
necessary, or even absolutely indispensable 
to the statutory employer's business, since, 
after all, this could be said of practically 
any repair, construction or transportation 
service. The test . . . is whether this 
indispensable activity is, in that 
business, normally carried on through 
employees rather than independent 
contractors.3 
 
                         
3 The test does not apply when the "the work is obviously a 
subcontracted fraction of a main contract."  Shell Oil, 212 Va. 
at 722, 187 S.E.2d at 167 (internal quotation marks omitted). 
 
In the context of the construction business, 
[this test] relates to a general contractor, 
the party obligated by the main contract 
with the owner to complete the whole 
project.  If the work out of which the 
accident arose was . . . obviously a 
subcontracted fraction of [that] contract 
and . . . not a part of the trade, business 
or occupation of the owner, the general 
contractor who engaged the subcontractor to 
perform that fraction is the statutory 
employer of the injured worker, whether 
directly employed by the primary 
subcontractor or by a secondary 
subcontractor. 
 
Cinnamon, 238 Va. at 476, 384 S.E.2d at 620 (internal quotation 
marks omitted). 
11 
Id. at 722, 187 S.E.2d at 167 (internal quotation marks 
omitted).  This test, however, is "only a corollary guide, 
sometimes useful but not indispensable, in applying the literal 
language of the statutes to the facts in a particular 
case."  Cinnamon, 238 Va. at 478, 384 S.E.2d at 621. 
 
For example, in Nichols, the Greater Roanoke Transit 
Company (GRTC) owned a "construction/rehabilitation project 
designed to provide public mass transportation facilities, 
downtown parking facilities, retail and office space facilities, 
and revitalization and urban development" of a commercial 
shopping district.  241 Va. at 518, 403 S.E.2d at 699-700.  
Addressing a defendant's argument that the normal work test did 
not apply because GRTC had no employees, the Court stated: 
[T]his argument "misses the mark." . . . .  
The key issue here is whether construction 
and rehabilitation of a transportation and 
retail facility was part of GRTC's business 
purpose of providing mass transportation 
services.  This purpose is established in 
its articles of incorporation. 
 
Id. at 522, 403 S.E.2d at 702 (quoting Carmody, 234 Va. at 205, 
361 S.E.2d at 132); see Evans v. Hook, 239 Va. 127, 132, 387 
S.E.2d 777, 779 (1990) (stating that "a defendant's business 
structure and number of employees have never been considerations 
in deciding whether [it] is entitled to the [A]ct's immunity").  
The Court stated that although GRTC clearly required a facility 
"from which their business is conducted," the actual 
12 
construction or adaptation of the facility "is not itself the 
trade, business, or occupation of the owner."  Nichols, 241 Va. 
at 522, 403 S.E.2d at 702. 
We have considered construction or repair of 
such a facility not to be the trade, 
occupation, or business of an owner for 
purposes of determining whether a statutory 
employee or employer relationship 
exists unless those activities are normally 
carried out directly by the owner or are 
part of [its] normal activities. 
  
Id. at 522, 403 S.E.2d at 702 (emphasis added). 
In determining whether Ubaldo's construction work was part 
of LBP's trade, business, or occupation, we therefore do not 
simply examine whether LBP engaged in construction.  Nor is the 
fact that LBP had no employees determinative.  Rather, we must 
determine whether Ubaldo's construction work at the time of his 
fatal accident was part of LBP's business.  See Carmody, 234 Va. 
at 205, 361 S.E.2d at 132; see also Floyd v. Mitchell, 203 Va. 
269, 274, 123 S.E.2d 369, 372 (1962) ("The test is not whether 
the owner, by engaging an independent contractor to perform some 
part of his business, thereby engages in the business of the 
independent contractor.  It is whether the independent 
contractor is performing work that is part of the trade, 
business or occupation of the owner."). 
 
According to Lauer, LBP was created for a single purpose: 
to develop the Park so that LBP could ultimately lease or sell 
13 
the finished warehouses.  It necessarily engaged in many 
preliminary steps or activities to accomplish its business 
purpose of selling or leasing the warehouses.  The development 
of the property, including the construction of the warehouses, 
was obviously essential, just as a plant is to a 
manufacturer.  See Cinnamon, 238 Va. at 478, 384 S.E.2d at 621 
("'Every manufacturer must have a plant, but this fact alone 
does not make the work of constructing a plant a part of the 
trade or business of every manufacturer who engages a contractor 
to construct a plant.'") (quoting Raines v. Gould, Inc., 343 
S.E.2d 655, 659 (S.C. Ct. App. 1986)).  While many activities 
may be important or even "indispensable" to the success of a 
business, those activities do not necessarily constitute the 
trade, business, or occupation of the owner.  Cinnamon, 238 Va. 
at 475; 304 S.E.2d at 620; see Shell Oil, 212 Va. at 722-23, 187 
S.E.2d at 167-68 (holding that retail sale of gasoline was 
indispensable activity to Shell Oil Company but nevertheless not 
part of its trade, business, or occupation).  As a private 
entity, LBP had the "broad discretion to choose its business 
activities."  Nichols, 241 Va. at 521, 403 S.E.2d at 701. 
 
The circuit court dismissed this wrongful death action on 
LBP's plea in bar.  A plea in bar presents a distinct issue 
that, if proven, bars a plaintiff's right of recovery.  Hilton, 
275 Va. at 179, 654 S.E.2d at 574.  LBP, as the moving party, 
14 
had the burden of proving that Ubaldo's construction work at the 
time of the accident was part of LBP's trade, business, or 
occupation.  See id. at 179-80, 654 S.E.2d at 574.  We conclude, 
as a matter of law, that LBP did not carry that burden.  
Establishing that LBP contracted with Reed to construct the 
warehouses and sought to ensure that the work was "done 
properly" is not sufficient to establish that construction is 
part of LBP's trade, business or occupation.  Henderson, 233 Va. 
at 381, 225 S.E.2d at 598 ("[T]he mere fact a business owner 
engages an independent contractor does not make that independent 
contractor's employees statutory employees of the 
owner."); Cinnamon, 238 Va. at 479, 384 S.E.2d at 622 
(overseeing construction by employees does not compel the 
conclusion that construction is the trade, business or 
occupation of the owner).  LBP may have demonstrated that the 
construction of warehouses was indispensable to the success of 
its business, but it did not prove that Ubaldo's construction 
work was part of LBP's trade, business, or 
occupation.  See Cinnamon, 238 Va. at 475, 384 S.E.2d at 620. 
 
In arguing that Ubaldo's construction work was part of its 
trade, business, or occupation, LBP relies principally 
on Pfeifer.  There, as here, a company with no employees, 
Linkhorn Bay Associates, L.L.C., contracted all work on a 
project to subcontractors.  262 Va. at 265, 546 S.E.2d at 718.  
15 
An employee of one subcontractor sued another subcontractor, 
Krauss Construction Company of Virginia, Inc. (Krauss) for 
personal injuries sustained while Krauss employees were 
installing natural gas lines.  Id.  As a statutory co-employee 
case, the determinative issue was whether Krauss' "installation 
of the gas line was a part of the trade, business, or occupation 
of Linkhorn Bay, making Krauss [the plaintiff's] statutory co-
employee."  Id. at 267, 546 S.E.2d at 719.  The Court held that 
it was: "Linkhorn Bay had been formed solely to build and 
develop these condominiums [and] had no other function[;] the 
installation of the gas lines was part of Linkhorn Bay's 
construction project covered by the terms of [the parties'] 
contract."  Id. at 268, 546 S.E.2d at 720. 
Contrary to LBP's argument, Pfeifer does not control here.  
Determining whether work is part of the trade, business, or 
occupation of an owner "depends upon the facts and circumstances 
of the particular case."  Johnson, 244 Va. at 485, 422 S.E.2d at 
780.  Linkhorn Bay had been formed "solely to build and develop 
. . . condominiums."  Pfeifer, 262 Va. at 268, 546 S.E.2d at 720 
(emphasis added).  Its trade, business, or occupation was not 
disputed, and installing the natural gas lines and connecting 
them to the condominium units were obviously part of its 
business purpose to build the condominiums. 
16 
CONCLUSION 
For these reasons, we conclude that LBP was not Ubaldo's 
statutory employer under Code § 65.2-302(A) at the time of his 
fatal accident.  As a matter of law, the circuit court erred by 
granting LBP's plea in bar.  We will reverse the circuit court's 
judgment and remand the case for further proceedings consistent 
with this opinion.4 
Reversed and remanded. 
                         
4 In light of our holding, we need not address Rodriguez' 
other assignments of error except for her argument that, under 
Rule 1:1, the circuit court lacked jurisdiction over the case to 
reconsider the plea in bar after this Court's first remand. 
Rodriguez' argument is without merit. 
 
Upon Rodriguez' timely appeal from the circuit court's 2010 
judgment sustaining the plea in bar, this Court obtained 
jurisdiction over the case.  Ghameshlouy v. Commonwealth, 279 
Va. 379, 390, 689 S.E.2d 698, 703 (2010).  By reversing the 
circuit court's order and remanding the case, we vacated the 
circuit court's August 2010 order.  See Nassif v. Board of 
Supervisors, 231 Va. 472, 480, 345 S.E.2d 520, 525 (1986) ("When 
this Court rules that the judgment of a trial court is erroneous 
. . . it is no longer viable.  Unless we say otherwise, the 
slate is wiped clean, with the result that on remand the parties 
begin anew.").  Although the circuit court made the same 
findings of fact on remand and concluded that LBP was Ubaldo's 
statutory employer, it did not simply modify its prior order.  
Instead, it entered a new order.  That action, therefore, did 
not implicate Rule 1:1. 
 
JUSTICE McCLANAHAN, with whom JUSTICE POWELL joins, concurring 
in part and dissenting in part. 
 
Today the majority terminates the ability of injured workers 
to seek workers' compensation from developers like LBP, contrary 
to the remedial purposes of the Virginia Workers' Compensation 
Act (the Act).  At the same time, the majority exposes such 
developers to common law tort liability that is completely at 
odds with applicable statutory and case law.  The majority 
offers no discernible rationale for effecting these results.  We 
are provided only the majority's conclusory assertion – contrary 
to the facts and law - that LBP failed to prove that Ubaldo, as 
Reed's employee, was performing work that was part of LBP's 
trade, business or occupation at the time of his work-related 
accident. 
On the undisputed facts in this case, the circuit court 
correctly concluded that LBP was Ubaldo's statutory employer 
based on its finding that Reed's construction of the warehouses 
at Leesburg Business Park (the Park) was a part of LBP's trade, 
business or occupation.  I would therefore affirm the judgment 
of the circuit court sustaining LBP's plea in bar pursuant to 
the Act's exclusive remedy provision.1 
                         
1 In light of this conclusion, as explained in Part II 
below, I would also address, but would reject, Rodriguez' 
 
18 
Accordingly, I dissent from the majority's conclusion that 
LBP was not Ubaldo's statutory employer and its reversal of the 
circuit court's judgment.  However, I concur in the majority's 
rejection of Rodriguez' jurisdictional argument based on Rule 
1:1.2 
I.  LBP'S STATUTORY EMPLOYER STATUS 
A. Controlling Statutes and Remedial Purpose 
 
By the terms of the Act's exclusive remedy provision, Code 
§ 65.2-307(A),3 the rights and remedies provided in the Act are 
exclusive of all other rights and remedies that a covered 
employee and his beneficiaries might otherwise possess as a 
result of the employee's job-related accident.  Under this 
statute, an injured employee and his beneficiaries are precluded 
from maintaining a common law action against the employee's 
immediate employer for an injury sustained in the course of 
                                                                               
alternative argument that, even if LBP was Ubaldo's statutory 
employer, LBP waived its defense of immunity under the Act 
because LBP did not purchase workers' compensation insurance or 
qualify as a self-insurer. 
 
2 The majority discusses and disposes of Rodriguez' 
jurisdictional argument in footnote 4 of its opinion. 
 
3 Code § 65.2-307(A) states: 
 
 
The rights and remedies herein granted to an employee when 
his employer and he have accepted the provisions of this title 
respectively to pay and accept compensation on account of injury 
or death by accident shall exclude all other rights and remedies 
of such employee, his personal representative, parents, 
dependents or next of kin, at common law or otherwise, on 
account of such injury, loss of service or death. 
19 
employment when the employee and the employer have accepted the 
Act's provisions.  See Hudson v. Jarrett, 269 Va. 24, 29, 606 
S.E.2d 827, 829 (2005); Pfeifer v. Krauss Const. Co., 262 Va. 
262, 266, 546 S.E.2d 717, 719 (2001).  An exception, however, to 
the Act's exclusive remedy provision is set forth in Code § 
65.2-309(A), which permits the employee to bring a common law 
action against a third-party tortfeasor, provided the tortfeasor 
is an "other party" within the meaning of the Act.  Crocker v. 
Riverside Brick & Supply Co., 273 Va. 235, 238-39, 639 S.E.2d 
214, 216 (2007); Anderson v. Dillow, 262 Va. 797, 799-800, 553 
S.E.2d 526, 527 (2001). 
 
An owner such as LBP, which is not the injured employee's 
immediate employer, is nonetheless "under the canopy of the 
[A]ct and entitled to the immediate employer['s] statutory 
immunity from common-law actions" if the owner qualifies as the 
injured employee's statutory employer, thereby negating "other 
party" status.  Evans v. Hook, 239 Va. 127, 131, 387 S.E.2d 777, 
779 (1990).  The test for determining whether an owner becomes a 
statutory employer is set forth in Code § 65.2-302(A) as 
follows: 
 
When any person (referred to in this section as 
"owner") undertakes to perform or execute any work which is 
a part of his trade, business or occupation and contracts 
with any other person (referred to in this section as 
"subcontractor") for the execution or performance by or 
under such subcontractor of the whole or any part of the 
work undertaken by such owner, the owner shall be liable to 
20 
pay to any worker employed in the work any compensation 
under this title which he would have been liable to pay if 
the worker had been immediately employed by him. 
 
The project owner is thus deemed to be the statutory employer of 
the independent contractor's employees if those employees are 
engaged in work that is a part of the owner's trade, business, 
or occupation.4  If so, the owner is rendered liable to those 
employees for workers' compensation benefits. 
 
The purposes of Code § 65.2-302(A) are to afford protection 
to "'the employees of [independent contractors] who are not 
financially responsible,'" Bassett Furniture Industries, Inc. v. 
McReynolds, 216 Va. 897, 902, 224 S.E.2d 323, 326 (1976) 
(quoting Sears, Roebuck & Co. v. Wallace, 172 F.2d 802, 810 (4th 
Cir. 1949)), and to "prevent an owner from escaping liability 
under the Act by the simple expedient of subcontracting away 
work which is part of its trade, business, or 
occupation."  Henderson v. Central Tel. Co. of Va., 233 Va. 377, 
381, 355 S.E.2d 596, 598-99 (1987). 
These purposes are reflective of the "highly remedial" 
nature of the Act, id. at 382, 355 S.E.2d at 599; Board of 
Supervisors of Amherst County v. Boaz, 176 Va. 126, 134, 10 
S.E.2d 498, 501 (1940), which is to be construed to effect its 
fundamental purpose of providing workers with statutory 
                         
 
4 The employees, in turn, become the "statutory employees" 
of the owner.  Crocker, 273 Va. at 238-39, 639 S.E.2d at 216. 
21 
compensation for accidental injuries resulting from the hazards 
of their employment.  Henderson, 233 Va. at 382, 355 S.E.2d at 
599; Feitig v. Chalkley, 185 Va. 96, 98, 38 S.E.2d 73, 75 
(1946).  Accordingly, in this case, even though Rodriguez does 
not seek workers' compensation benefits from LBP, "our 
consideration of this appeal is nevertheless governed by the 
principles that apply in a case where coverage is 
sought."  Henderson, 233 Va. at 382, 355 S.E.2d at 599. 
B.  LBP's Trade, Business or Occupation 
The undisputed facts, material to the analysis of whether 
Reed's construction of the Park warehouses was part of LBP's 
trade, business, or occupation under the terms of Code § 65.2-
302(A), are as follows.  LBP, a Virginia limited liability 
company, was organized by Lauer, its owner and sole member, for 
the purpose of "acquiring, holding, improving, managing, leasing 
and selling real estate," as set forth in its operating 
agreement.5  LBP was specifically organized to effect that 
purpose through the Park property project.  Upon its acquisition 
of the Park property, LBP was, in fact, responsible for the 
property being commercially developed, and for the sale and 
lease of the warehouse units that were constructed on the 
                         
5 In this context, Black's Law Dictionary defines the word 
"improve" to mean: "To develop (land) . . . ."  Black's Law 
Dictionary 826 (9th ed. 2009). 
22 
property.  LBP received its income from the sale and lease of 
those warehouse units. 
With no employees or equipment, LBP implemented its 
organizational objectives through Lauer, independent contractors 
and consultants.  LBP acquired the Park property as totally 
undeveloped, raw land.  In developing the property, LBP 
obtained, among other things: numerous studies regarding the 
financial viability of developing the Park property, the 
practicality of construction, and the risk of development; 
appraisals; bids from contractors; various government permits, 
bonds and approvals; and construction financing. 
LBP made the decision to improve the Park property by the 
construction of the Park warehouses, obtained the necessary 
approvals for their construction, and procured an architect to 
design them.  After interviewing various contractors to 
construct the warehouses, LBP selected Reed.  LBP and Reed then 
entered into a contract making Reed solely responsible for 
constructing the warehouses to the agreed specifications.  LBP 
hired an owner's representative to oversee the construction 
process, "serving as [Lauer's] eyes and ears as to what's going 
on with the project," as Lauer explained.  Lauer had weekly 
meetings with this representative regarding the progress of the 
construction.  The architect that designed the warehouses also 
inspected, on LBP's behalf, Reed's work over the course of the 
23 
warehouses' construction.  Lauer made the ultimate decision on 
any construction issues. 
The majority, without acknowledging it, evidently accepts 
Rodriguez' central argument that because LBP did not, and could 
not, construct the Park warehouses itself, Reed's construction 
of the warehouses was not a part of LBP's trade, business, or 
occupation; rather, LBP was merely "investing in real estate," 
placing LBP outside the purview of the definition of statutory 
employer in Code § 65.2-302(A) for that part of the Park's 
development. 
This argument is unavailing as it conflicts with the 
express terms of Code § 65.2-302(A), which imposes workers' 
compensation liability on an owner, as a statutory employer, 
when the owner undertakes through an independent contractor 
"the whole or any part of the work" that is "a part of [the 
owner's] trade, business or occupation."  (Emphasis added).  The 
statute thus "contemplates that an owner such as [LBP] can 
subcontract all its work yet remain liable under the 
Act."  Henderson, 233 Va. at 381, 355 S.E.2d at 598.  Hence, 
under our case law, "a defendant's business structure and number 
of employees have never been considerations in deciding whether 
[it] is entitled to the [A]ct's immunity" from a common law suit 
as a statutory employer.  Evans, 239 Va. at 132, 387 S.E.2d at 
779. 
24 
As this Court has previously explained, "an owner may 
perform or execute work that is part of [its] trade, business, 
or occupation through contractors or subcontractors, directly 
employing no workers for the purpose." Smith v. Horn, 232 Va. 
302, 305, 351 S.E.2d 14, 16 (1986) (emphasis added) 
(citing Anderson v. Thorington Const. Co., 201 Va. 266, 272-73, 
110 S.E.2d 396, 400-01 (1959)).  But "if the work performed by 
an employee of the contractor or subcontractor is [such a] part 
. . .  the worker is deemed the statutory employee of the owner, 
and the owner is liable for compensation as though the worker 
were [its] own employee."  Id. at 305-06, 351 S.E.2d at 16. 
LBP utilized a business model for its development of the 
Park property that required no direct employees for the 
construction of its Park warehouses.  However, LBP should be 
unable to thereby "escap[e]" statutory employer 
status.  Henderson, 233 Va. at 381, 355 S.E.2d at 598.  "[T]he 
whole [warehouse construction] work undertaken by [LBP]" was 
performed by Reed, LBP's independent contractor, in a manner 
contemplated by Code § 65.2-302(A).  The undertaking was in 
furtherance of the express purposes for which LBP was 
established, and comprised the main component of the Park 
property's intended development and use.  From the beginning, 
LBP's plan was to acquire the Park property in its unimproved 
state, improve the property through the construction of the Park 
25 
warehouses, and then sell or lease the warehouse units.  The 
construction of the Park warehouses was thus necessarily an 
integral part of LBP's "trade, business or occupation" under the 
terms of Code § 65.2-302(A). 
It is therefore inconsequential that LBP did not "make money off 
of the construction [of the warehouses] itself," as Lauer 
acknowledged, with Reed being paid to construct them.  Even if 
LBP had performed the construction with employees of its own, it 
would not have made "money off of the construction itself," as 
the project's owner (i.e., LBP would not have received payments 
for its own construction work).  In either case, LBP's income 
would have been generated at the point of sale and/or lease of 
the warehouse units, just like any other owner-developer of a 
similar project (with or without its own construction crew).  By 
the very nature of commercial real estate development, the 
developer generates income upon completion of the project from 
the sale or lease of the developed property or some portion of 
it.  Nonetheless, we have never deemed the point at which income 
is generated from a commercial undertaking to be dispositive in 
determining an entity's trade, business or occupation under Code 
§ 65.2-302(A), and I see no good reason for doing so here. 
Finally, the majority's stated reasons for rejecting LBP's 
reliance on Pfeifer plainly support the counter-position.  
Applying Code § 65.2-302 in Pfeifer, we held that an independent 
26 
contractor's installation of gas lines undertaken for a 
condominium development project was a part of the trade, 
business, or occupation of the owner-developer, Linkhorn Bay 
Associates, L.L.C. (Linkhorn Bay).  Much like LBP, Linkhorn Bay 
was a limited liability company that was organized for the 
purpose of developing condominiums, had no employees and 
"subcontracted all the work to various subcontractors."  Id. at 
265, 546 S.E.2d at 718.  In attempting to distinguish Pfeifer, 
the majority points to the fact that Linkhorn Bay had been 
formed solely to build and develop condominiums.  The majority 
then concludes that "installing the natural gas lines and 
connecting them to the condominium units were obviously part of 
its business purpose to build the condominiums."  This 
observation seems to simply ignore the fact that LBP's 
development of the Park property by the construction of 
warehouse units was undisputedly in furtherance of LBP's 
organizational and business purpose, as set forth in LBP's 
operating agreement.  It would thus be completely illogical to 
contemplate that somehow installation of natural gas lines to 
those warehouse units would be a part of LBP's business purpose 
to build those units, but the actual construction of the units 
would not be a part of that purpose. 
 
Accordingly, I would hold the circuit court correctly 
concluded that LBP was Ubaldo's statutory employer because 
27 
Ubaldo, as Reed's employee, was performing work that was a part 
of LBP's trade, business, or occupation at the time of his work-
related accident.  Given the undisputed facts before it, the 
circuit court's conclusion was dictated by both the express 
terms of Code § 65.2-302(A) and the statute's remedial purpose.6 
II.  LBP AS UNINSURED STATUTORY EMPLOYER 
 
Rodriguez argues that even if Ubaldo was LBP's statutory 
employer, pursuant to Code § 65.2-805 of the Act, LBP waived 
its defense of immunity in this action because LBP failed to 
purchase workers' compensation insurance covering Reed's 
employees, or to qualify as a self-insurer. 
                         
6 I take issue with the majority's indication that, 
initially, LBP argued and the circuit court held that "Ubaldo 
and LBP were statutory co-employees," citing this Court's 
unpublished order in Rodriguez' first appeal, Rodriguez v. 
Leesburg Business Park, LLC, Record No. 102127, slip op. at 4 
(Jan. 6, 2012) (per curiam).  At no time did the circuit court 
or LBP refer to LBP and Ubaldo as "statutory co-employees."  
(Emphasis added.)  This phrase was of Rodriguez' making, and 
then attributed to LBP and the circuit court by the current 
majority of this Court in its unpublished order remanding this 
case for reconsideration, as well as in its instant opinion.   
The circuit court actually found in its initial ruling that 
"[Ubaldo] was a statutory co-employee of LBP."  (Emphasis 
added.)  This finding no doubt derived from LBP's use of this 
phrase in the context of framing the issue as a question of 
"whether [Ubaldo] was a statutory employee of LBP, as well as an 
employee of EE Reed."  LBP otherwise referred to Ubaldo as 
"LBP's statutory co-employee."  LBP also referred to itself as 
Ubaldo's "co-employer" and his "statutory employer."  Thus, 
while LBP's phraseology may have been novel for workers' 
compensation law, it did not reflect a misapprehension that LBP 
and Ubaldo were somehow "statutory co-employees." 
28 
On the facts of this case, LBP's uninsured status is 
immaterial.  Under the Act, both Reed, as Ulbaldo's immediate 
employer, and LBP, as Ulbaldo's statutory employer, would have 
been liable to Ulbaldo and his statutory beneficiaries for his 
work-related accident.  Upon Ulbaldo's death, the beneficiaries 
would have been entitled to benefits under the Act from either 
Reed or LBP, but not from both.  David White Crane Service v. 
Howell, 282 Va. 323, 329, 714 S.E.2d 572, 576 (2011).  The 
beneficiaries pursued their rights and remedies under the Act 
and obtained a full recovery of workers' compensation benefits 
from Reed.  Therefore, as the beneficiaries have received the 
"one full recovery" they were entitled to under the Act, id. 
(citation and internal quotation marks omitted), they would be 
barred from pursuing "other rights and remedies" against LBP 
under the Act's exclusive remedy provision.  Code § 65.2-307(A).  
I would thus hold the trial court correctly rejected Rodriguez' 
argument that, because LBP was uninsured, it waived its immunity 
to suit in this common law action. 
For these reasons, I would affirm the judgment of the 
circuit court in sustaining LBP's plea in bar pursuant to the 
Act's exclusive remedy provision.  I therefore dissent to the 
majority's conclusion that LBP was not Ubaldo's statutory 
employer and its reversal of the trial court's judgment.  I 
concur, however, in the majority's rejection of Rodriguez' 
29 
jurisdictional argument based on Rule 1:1, as the majority 
addresses in footnote 4 of its opinion.