Opinion ID: 1191953
Heading Depth: 2
Heading Rank: 2

Heading: Peculiar Risk or Inherently Dangerous Work Doctrine

Text: ¶ 27 Thompson also relies on sections 413, 416, and 427 of the Restatement and urges this court to adopt those sections in his favor as exceptions to the general rule that one who employs an independent contractor is not liable for injuries arising out of the contract work. These sections are similar in wording and are commonly referred to as the peculiar risk doctrine, see, e.g., Privette v. Superior Court, 5 Cal.4th 689, 21 Cal.Rptr.2d 72, 854 P.2d 721, 725 (1993) (en banc), or the inherently dangerous work exception, see, e.g., Wagner v. Continental Cas. Co., 143 Wis.2d 379, 421 N.W.2d 835, 840 (1988). ¶ 28 Section 413 is premised on direct liability for a principal employer's negligence in failing to insure that special precautions are taken in the contractor's work. That section provides: § 413. Duty to Provide for Taking of Precautions Against Dangers Involved in Work Entrusted to Contractor One who employs an independent contractor to do work which the employer should recognize as likely to create, during its progress, a peculiar unreasonable risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the absence of such precautions if the employer (a) fails to provide in the contract that the contractor shall take such precautions, or (b) fails to exercise reasonable care to provide in some other manner for the taking of such precautions. Restatement (Second) of Torts § 413 (1965). ¶ 29 Sections 416 and 427 impose vicarious liability on the principal employer for the contractor's negligence, even if the employer reasonably provides for precautions in the contract work. Those sections state: § 416. Work Dangerous in Absence of Special Precautions One who employs an independent contractor to do work which the employer should recognize as likely to create during its progress a peculiar risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the failure of the contractor to exercise reasonable care to take such precautions, even though the employer has provided for such precautions in the contract or otherwise. . . . . § 427. Negligence as to Danger Inherent in the Work One who employs an independent contractor to do work involving a special danger to others which the employer knows or has reason to know to be inherent in or normal to the work, or which he contemplates or has reason to contemplate when making the contract, is subject to liability for physical harm caused to such others by the contractor's failure to take reasonable precautions against such danger. Restatement (Second) of Torts §§ 416, 427 (1965). The purpose of these sections is to ensure that innocent third parties injured by the negligence of an independent contractor hired by a landowner to do inherently dangerous work on the land would not have to depend on the contractor's solvency in order to receive compensation for the injuries. Privette, 21 Cal.Rptr.2d 72, 854 P.2d at 725. Privette held that this purpose is not advanced when these exceptions are applied in favor of a contractor's employees who are covered by workers' compensation. See id. 21 Cal.Rptr.2d 72, 854 P.2d at 726-30; see also Wagner, 421 N.W.2d at 840-44 (detailing reasons for not adopting sections 413, 416, and 427 in favor of employees of independent contractors). ¶ 30 We agree with Privette and Wagner and decline to apply section 413, 416, or 427 of the Restatement in the manner Thompson proposes. Whether based on direct negligence under section 413 or vicarious liability under sections 416 and 427, these provisions have no application when the injured person is an employee of the independent contractor undertaking the allegedly dangerous work. The majority of jurisdictions that have examined this issue have decided likewise. [4] ¶ 31 Along with Privette and Wagner, Zueck v. Oppenheimer Gateway Properties, 809 S.W.2d 384 (Mo.1991) (en banc), is representative of those decisions. As expounded in Zueck, if employees of an independent contractor are allowed to avail themselves of the peculiar risk doctrine or inherently dangerous work exception, the principal employer is placed in an untenable position: he or she must anticipate activities that are inherently dangerous to the contractor's employees and, if the dangers inhere to the manner in which the work is done, protect against such dangers despite the fact that the employees are best able to identify and address whatever hazards are involved in their own method of performance. Oftentimes, both the risks involved and the protections necessary to avoid the risks are beyond the principal employer's knowledge or capacity. Thus, to avoid the liability imposed by the peculiar risk doctrine or inherently dangerous work exception, the principal employer has an incentive to direct his or her own employees to do the work despite their lack of expertise. Such a choice would limit the principal employer's exposure to that under the Workers' Compensation Act but, at the same time, increase the risk of injury to the principal's employees and innocent third parties. Placing principal employers in such a position distorts the objectives of tort law, and for that reason, the peculiar risk doctrine or inherently dangerous work exception should not apply in favor of employees of the independent contractor performing the work. See Zueck, 809 S.W.2d at 387-88. ¶ 32 In addition, sections 413, 416, and 427 each speak of liability for injury to others, which implies third parties rather than employees of the independent contractor carrying out the contracted work. An early draft of the Restatement included a special note which, though ultimately not adopted, provided guidance on this point: Special Note. The rules stated in this Chapter are, in general, not applicable to make the defendant who hires an independent contractor liable to two classes of persons. One consists of the employees, or servants, of the defendant himself.... The other class of plaintiffs not included in this Chapter consists of employees of the independent contractor.... One reason why such responsibility has not developed has been that the workman's recovery is now, with relatively few exceptions, regulated by workmen's compensation acts.... While workmen's compensation acts do not infrequently provide for third-party liability, it has not been regarded as necessary to impose such liability upon one who hires the contractor, since it is expected that the cost of the workmen's compensation insurance will be included by the contractor in his contract price for the work, and so will in any case ultimately be borne by the defendant who hires him. Restatement (Second) of Torts (Tent. Draft No. 7, Apr. 16, 1962) ch. 15, special note at 17-18. The American Law Institute omitted this note due to lack of uniformity of the effect of the various state workers' compensation acts but indicated nonetheless that certainly the prevailing point of view is that there is no liability on the part of the employer of the independent contractor. 39 A.L.I. Proc. 244, 247 (1962); see also Monk v. Virgin Islands Water & Power Auth., 53 F.3d 1381, 1390-91 (3d Cir.), cert. denied, 516 U.S. 914, 116 S.Ct. 302, 133 L.Ed.2d 207 (1995) (referring to same language of tentative draft of Restatement). ¶ 33 The rationale set forth in the special note quoted above is persuasive and provides additional support for our holding that sections 413, 416, and 427 of the Restatement have no application to employees of independent contractors performing the work at issue. The phrase to others in these sections does not encompass such employees, but rather, innocent third parties. This is consistent with the analysis in Dayton and with Tenth Circuit case law applying Dayton to this issue. See Eutsler v. United States, 376 F.2d 634, 636 (10th Cir.1967) (concluding that phrase to others as contained in Restatement § 413 does not include employees of independent contractors); see also United States v. Page, 350 F.2d 28 (10th Cir.1965), cert. denied, 382 U.S. 979, 86 S.Ct. 552, 15 L.Ed.2d 470 (1966) (acknowledging that general law on subject reaches same conclusion as to Restatement § 427). ¶ 34 Holding otherwise would create unfair and anomalous results under Utah's workers' compensation system: Courts and legal commentators have expressed concern that to allow an independent contractor's employees who incur work-related injuries compensable under the workers' compensation system to also seek damages under the doctrine of peculiar risk from the person who hired the contractor would give those employees an unwarranted windfall. As these authorities point out, to permit such recovery would give these employees something that is denied to other workers: the right to recover tort damages for industrial injuries caused by their employer's failure to provide a safe working environment. This, in effect, would exempt a single class of employees, those who work for independent contractors, from the statutorily mandated limits of workers' compensation. Privette, 21 Cal.Rptr.2d 72, 854 P.2d at 729. Furthermore, given that the exclusive remedy provision of the workers' compensation scheme limits the liability of independent contractors to coverage premiums, permitting an employee of the contractor to recover tort damages against the nonnegligent landowner who employed the contractor would allow for the inequitable result that a nonnegligent person's liability for an injury is greater than that of the person whose negligence actually caused the injury. [5] ¶ 35 In the present case, there is no question that Thompson was an employee of the independent contractor, AmeriKan Sanitation, at the time of his injury. He was involved in attempting to install the pipe and, indeed, has been receiving workers' compensation benefits through AmeriKan Sanitation since the accident. We have no reason to question the determination (already made as a prerequisite to Thompson's qualifying for such benefits) that Thompson was acting within the course of his employment when injured. See Allen v. Industrial Comm'n, 729 P.2d 15, 18 (Utah 1986) (noting that to qualify for workers' compensation benefits, injury must be by accident and must arise in the course of employment). Accordingly, the trial court correctly determined as a matter of law that Thompson's sole recourse is workers' compensation benefits.