Opinion ID: 3033866
Heading Depth: 3
Heading Rank: 2

Heading: The Independent-Contractor Exception

Text: [1] Under the FTCA’s limited waiver of sovereign immunity, the United States is liable to the same extent as a private party for certain torts of federal employees acting within the scope of their employment, “in accordance with the law of the place where the act or omission occurred.” 28 U.S.C. § 1346(b)(1). See also 28 U.S.C. § 2674 (“the law of the place where the act or omission complained of occurred”). The FTCA includes officers and employees of “any federal agency” but expressly excludes “any contractor with the United States.” 28 U.S.C. § 2671. “[T]he critical test for distinguishing an agent from a contractor is the existence of federal authority to control and supervise the ‘detailed physical performance’ and ‘day to day operations’ of the contractor.” Hines v. United States, 60 F.3d 1442, 1446 (9th Cir. 1995) (citations omitted). Federal law determines whether an individual is a federal employee. Billings v. United States, 57 F.3d 797, 800 (9th Cir. 1995). Common law agency principles are also instructive in determining whether one is a contractor or an employee. E.g., Logue v. United States, 412 U.S. 521, 526-27 (1973); Will v. United States, 60 F.3d 656, 659 (9th Cir. 1995). “Courts are 13020 AUTERY v. UNITED STATES not free to ‘abrogate the [independent-contractor] exemption’ for the negligent acts of contractors regardless of whether there is a good reason for so doing.” Hines, 60 F.3d at 1447 (quoting Logue, 412 U.S. at 528). [2] Contractual provisions directing detailed performance generally do not abrogate the contractor exception. The United States may “fix specific and precise conditions to implement federal objectives” without becoming liable for an independent contractor’s negligence. Orleans, 425 U.S. at 816. “Neither do standards that are designed to secure federal safety objectives convert the agent into an employee.” Hines, 60 F.3d at 1447 (citation omitted). “[D]etailed regulations and inspections are [not] evidence of an employee relationship.” Letnes v. United States, 820 F.2d 1517, 1519 (9th Cir. 1987) (citations omitted). That is, “the ability to compel compliance with federal regulation does not change a contractor’s personnel into federal employees.” Id. (citations omitted). Rather, “[t]here must be substantial supervision over the day-to-day operations of the contractor in order to find that the individual was acting as a government employee.” Id. (citation omitted). [3] Applying these standards, Plaintiffs cannot dispute that Fluor and DynCorp and HFD are government contractors. Moreover, all indications are that the government did not direct the actual performance of the contract (e.g., how to fight the fires, or how to disc the soils, or how to conduct a controlled burn). Plaintiffs don’t argue, and the complaint does not allege, that the government supervised or directed (or negligently supervised or directed) day-to-day operations of HFD as to maintaining firebreaks on the ALE near SR-24 so as to render any HFD employee a de facto government employee. Rather, Plaintiffs contend that, at least after the 1997 MOU, there was no contractual provision at all specifically for fire prevention or firebreak maintenance on the ALE. By its terms, the 1997 MOU between the DOE and FWS gave AUTERY v. UNITED STATES 13021 responsibility for “fire protection” to the FWS. Paragraph 4.3 of the MOU provided in part that “FWS will be responsible for coordination of the . . . fire protection, emergency preparedness, and . . . general maintenance and administration for the ALE.” (Emphasis added). Similarly, paragraph 5.5 provided that “Until FWS has developed its own approved management plan and has upgraded its own fire protection capabilities for the ALE, the appropriate DOE-RL POC . . . is responsible for providing FWS fire protection, including initial attack and incident management, for ALE structures and wildlands, on a cost reimbursable basis from FWS.” (Emphasis added.) Although the transition from DOE to FWS was not yet complete, under the MOU’s terms, the United States still maintained responsibility. [4] The problem for Plaintiffs is that the DOE contract with Fluor and Fluor’s subcontract with HFD were still in place. The MOU between DOE and FWS, even if it changed responsibility for management of the ALE, did not change those contracts. The continuation of the contracts indicates that the DOE had still delegated the same responsibilities to its contractors, even after the management change. Plaintiffs respond, however, by arguing that the subsequent notifications in letters to Fluor and HFD — that after the management change Fluor and HFD should “continue to provide fire protection services . . . to the ALE on a cost reimbursable basis” — also indicated that FWS (or the DOE) would now be responsible for other fire prevention and maintenance. Plaintiffs point to language in the subsequent 1998 Cooperative Agreement directly between FWS and HFD and contend that the agreement only covers “fire fighting” and not “fire prevention” or other maintenance such as firebreaks near the ALE. In particular, Plaintiffs point to the agreement’s “Scope” section and contend that there is nothing indicating that HFD is responsible for “fire prevention” duties, in general, nor for firebreak maintenance on the ALE or around SR24, in particular. On the other hand, the government points to 13022 AUTERY v. UNITED STATES the “Purpose” section, which indicates the Cooperative Agreement is for “fire protection and wildfire suppression.” To support their argument that the Cooperative Agreement deals only with actual “firefighting,” Plaintiffs point to the deposition testimony of Don Good, where he acknowledges that “fire protection” and “fire prevention” are different from “fire fighting.” They rely on his testimony where he says “HFD doesn’t do any fire prevention” or “fire protection” for FWS. Plaintiffs also point to the contractor-produced 1993 ALE Facility Management Report. They contend that compliance with the 1993 report was a requirement of the MOU, and was not merely “guidance” as the document indicates. Section 4.2.7 of the 1993 report says “All fire fighting is the responsibility of [HFD]” but then says “The ALE facility manager will periodically review the fire prevention and fire fighting plans with the [HFD], ensuring that facility users take appropriate steps to minimize the possibility of causing a fire[.]” Plaintiffs’ position, however, rests upon the proposition that, after the 1997 MOU, there no longer was a contractual provision in place between the DOE and Fluor (and, in turn, HFD) regarding fire prevention (or any other pre-MOU duty besides “fire protection services”). Nevertheless, it is plain that “fire prevention” and “fire protection system . . . maintenance” are included within the terms of the relevant contracts. Even assuming there was a specific requirement or expectation that firebreaks in particular would be maintained, such maintenance fits squarely within the contractual responsibilities. Further, contrary to the Plaintiffs’ position, the MOU between the DOE and FWS did not alter the terms and obligations of Fluor in its contract with DOE, or of DynCorp (HFD) in its corresponding subcontract with Fluor. The July 17, 1997, letter from DOE to Fluor (and the similar October 6, 1997, letter from Fluor to DynCorp) are AUTERY v. UNITED STATES 13023 effectively nothing more than official acknowledgments to Fluor and DynCorp of the signing of the MOU and confirmations that the MOU did not change existing contractual duties. There is no evidence that those letters indicated any intent to modify existing contractual agreements between the DOE and Fluor. (Indeed, the letters confirmed that duties would continue even after the MOU.) And by the MOU’s very terms, the management change had not yet occurred; an approved management plan had to be approved before FWS assumed control of the ALE. The independent-contractor exception to the FTCA applies here. The testimony of Don Good that “we don’t do any fire prevention for U.S. Fish and Wildlife,” even taken out of context, does not create a material dispute of fact regarding the contractual duties. At best for Plaintiffs (as indicated in the postwildfire reports), and construing evidence in their favor as is required at a summary judgment stage, there was confusion regarding the scope of duties specifically as to firebreak maintenance. But, even assuming so, it only indicates a potential issue regarding contractual performance. The independentcontractor exception to the FTCA would still apply. The Plaintiffs’ theory of negligence was premised upon a failure to maintain firebreaks along SR-24. The government argues, however, that there is no duty of a landowner as a matter of law specifically to utilize firebreaks in all circumstances. We need not reach this argument because, whether or not there was such a duty regarding firebreaks around SR-24, the contractual provisions plainly provide that “fire prevention” was delegated by the DOE (and FWS) to contractors. The contracts necessarily encompassed decisions about firebreaks as well.