Opinion ID: 866581
Heading Depth: 2
Heading Rank: 1

Heading: facts

Text: In 1989, PDSI, a Minnesota company which provides employees under lease agreements with transportation firms, entered into an employee leasing agreement with Miller, a Mississippi based trucking company. Miller and PDSI believed their leasing agreement remained in force on the date of the incident at issue in this case. From December 1, 2006 to December 1, 2007, PDSI had general commercial liability insurance from Harleysville, a Pennsylvania company. On September 6, 2007, a PDSI employee named Jonathan Hughes fell ten or eleven feet while working as a tank washer at a Miller truck maintenance facility in Nitro, West Virginia. On the day of the fall, PDSI’s “lead man” at the Nitro facility, 2 PDSI has done business as “Labor Services Company,” and various documents in the record refer to the company by that moniker. The parties’ briefs consistently refer to the company as PDSI, and we do the same in this opinion. 3 The Honorable Donovan W. Frank, United States District Judge for the District of Minnesota. -2- Edward Chapman, was one of Hughes’ supervisors. Although supervisory authority overlapped between Chapman and Miller in some respects, PDSI directed Hughes’ and its other employees’ daily activities based on decisions by Miller employees. When Hughes fell, the Miller employee serving as the Nitro facility’s maintenance supervisor was not present,4 and Hughes considered Chapman to be “in charge.” Hughes testified Chapman was the person who “instructed” Hughes to perform the task which led to his fall—cleaning resin out of a chemical tanker. Cleaning resin out of a chemical tanker required a team of two people—one person inside the tank to remove the resin and put the resin in five-gallon buckets; and one person outside the tank to carry the resin filled buckets from a platform on top of the tanker to the dumping area below. The outside worker would climb to the top of the tanker using a stationary ladder, transition to a mobile A-frame ladder, grab a resin filled bucket, and climb down the A-frame ladder. The outside workers followed this practice because the stationary ladder was perfectly vertical, making it easier and more comfortable to descend backward down the angled A-frame ladder. On the day of the fall, Hughes took the role of outside worker at Chapman’s instruction while Chapman himself worked inside the tank. After a trip or two up and down the ladders, Hughes reached the platform on top of the tanker, shifted to the A- frame ladder, and grabbed a resin filled bucket. This time, the weight of the bucket caused him to falter. Hughes began to fall, and the A-frame ladder kicked out from underneath him. As he fell to the concrete floor ten or eleven feet below, his head hit the A-frame ladder. He landed “almost flat,” mostly on his lower left side, injuring his lower back, hip, and left leg. Hughes testified the fall caused him recurring pain, including in the lower back, and affected his walking gait. 4 Hughes believed Miller’s maintenance supervisor, Tony Rich, had left for the day, but Rich testified he was in Mississippi the day Hughes fell. -3- The mechanics’ bay where the fall occurred did not have fall protection (e.g., a cable from which workers could tie a harness) or a stationary stairway to provide access to the tankers. Ed Bowman, a PDSI employee leased to Miller, said he and other PDSI employees working in Nitro were instructed to “tie-off[] and retract[]” (i.e., use fall protection) whenever they were working more than four feet off the ground. But the equipment to do so was only available in the wash rack, and not in the mechanics’ bays where resin cleaning took place. Well before Hughes fell, at least one PDSI employee working at the Nitro facility expressed safety concerns to Miller employee Wilson Tollett, who at the time was terminal manager of the Nitro facility. Tollett relayed the concerns to his Miller supervisors, who replied, “It is rolling stock.” Tollett told Bowman “the company said [putting fall protection and permanent stairs in the mechanics’ bays] was too much money.” Hughes sued Miller in West Virginia state court for (1) negligently failing “to provide a reasonably safe workplace,” and (2) intentionally exposing him to unsafe working conditions in violation of West Virginia law.5 Miller tendered the suit to PDSI. PDSI notified Harleysville of the suit on April 23, 2010, and asked Harleysville to defend the case and indemnify Miller. On May 21, 2010, Harleysville denied coverage, taking the position that the general commercial liability insurance policy PDSI obtained from Harleysville did not cover Hughes’ suit against Miller. On April 12, 2011, Miller notified PDSI that it had reached an agreement with Hughes to settle all claims for $300,000 and demanded that PDSI “fulfill its indemnity obligations” by reimbursing Miller $300,000 for the settlement plus $104,337 in legal fees. On April 14, 2011, Miller notified Harleysville of the settlement and demanded indemnification. On May 26, 2011, Hughes signed an agreement with Miller settling his claims for $300,000. 5 See W. Va. Code §§ 21-3-1 to -21, 23-4-2. -4-