Opinion ID: 2618356
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Heading Rank: 1

Heading: Riebe's Contract with the School Board

Text: Lewis contends that Riebe retained control over Garges' work by contractually assuming the responsibility of maintaining safety at the job site. The court of appeals rejected this argument, holding that: (1) Riebe's contractual responsibility for safety does not equate to the retention of control necessary to subject the general contractor to liability, Lewis v. Riebe Enter., Inc., 170 Ariz. 207, 212, 823 P.2d 74, 79 (App. 1990); and (2) the right to ... prohibit or correct unsafe practices ... does not impose liability for an unsafe condition created by the subcontractor ..., Lewis, 170 Ariz. at 212, 823 P.2d at 79. We do not find this reasoning persuasive. The court of appeals has held consistently that liability for [the] negligent exercise of retained supervisory powers can attach only when there is a showing that [the general contractor reserved] `the right to exercise day-by-day control over the manner in which the details of the work are performed.' Reber v. Chandler High School Dist., 13 Ariz. App. 133, 135, 474 P.2d 852, 854 (1970) (emphasis added), quoting E.L. Jones Constr. Co. v. Noland, 105 Ariz. 446, 456, 466 P.2d 740, 750 (1970). See also, e.g., Lewis, 170 Ariz. at 210, 823 P.2d at 77, citing Reber, 13 Ariz. App. at 135, 474 P.2d at 854; Koepke v. Carter Hawley Hale Stores, Inc., 140 Ariz. 420, 425, 682 P.2d 425, 430 (App. 1984), citing German v. Mountain States Tel. & Tel. Co., 11 Ariz. App. 91, 95, 462 P.2d 108, 112 (1969); Sullins v. Third & Catalina Constr. Partnership, 124 Ariz. 114, 120, 602 P.2d 495, 501 (App. 1979), citing Reber, 13 Ariz. App. at 135, 474 P.2d at 854; German, 11 Ariz. App. at 95, 462 P.2d at 112. We do not believe that such extensive control is required for liability under § 414. The court of appeals apparently has based its narrow interpretation of § 414 on the language it has quoted from Jones concerning day-to-day control over the details of the subcontractor's work. However, we believe this reliance on Jones is misplaced because Jones did not address § 414. Jones involved the issue of a general contractor's vicarious liability for a subcontractor's negligence, not a general contractor's liability for its own negligence. The court of appeals has also relied on comment (c) to § 414 for the proposition that a general contractor is subject to liability under § 414 only if it retains control over the subcontractor's method of doing the details of the work. See, e.g., Lewis, 170 Ariz. at 210, 823 P.2d at 77; Cordova v. Parrett, 146 Ariz. 79, 82, 703 P.2d 1228, 1231 (App. 1985); Mason v. Arizona Public Serv. Co., 127 Ariz. 546, 550, 622 P.2d 493, 497 (App. 1980); German, 11 Ariz. App. at 94-95, 462 P.2d at 111-12. We believe that the court of appeals has also misinterpreted comment (c), which states: In order for the rule stated in [§ 414] to apply, the employer must have retained at least some degree of control over the manner in which the work is done. It is not enough that he has merely a general right to order the work stopped or resumed, to inspect its progress or to receive reports, to make suggestions or recommendations which need not necessarily be followed, or to prescribe alterations and deviations. Such a general right is usually reserved to employers, but it does not mean that the contractor is controlled as to his methods of work, or as to operative detail. There must be such a retention of a right of supervision that the contractor is not entirely free to do the work in his own way. Comment (c) does not say that a general contractor must control the day-to-day details of a subcontractor's work in order to be subject to liability under § 414. Comment (c) merely suggests that [i]f the employer reserves and exercises only the right to inspect the construction work to see that the contract specifications are met while the independent contractor controls how and when the work is to be done, there is probably not sufficient retained control to subject it to liability. Moloso v. State, 644 P.2d 205, 211 (Alaska 1982) (citations omitted). Moreover, it is important to note that we could not apply § 414 if we adopted the court of appeals' interpretation of the amount of retained control necessary to subject a general contractor to liability under that section because § 414 applies only if there is a general contractor/independent subcontractor relationship. Such a relationship does not exist if a general contractor exercises day-to-day control over the details of a subcontractor's work because an independent contractor is one who ... contracts to do certain work according to his own methods, without being subject to the control of his employer, except as to the product or result of his work. This [relationship] stresses the lack of the right to control  not merely as to result, but also the manner, method and details of the work. Stuart M. Speiser, Charles F. Krause, & Alfred W. Gans, 1 American Law of Torts § 4:23, at 677 (1983) (footnote omitted). We believe that the appropriate test for retained control is found in comment (a) to § 414, which states that a general contractor may retain only the power to direct the order in which the work shall be done, or to forbid its being done in a manner likely to be dangerous to ... others. Such a supervisory control may not subject him to liability under the principles of Agency, but he may be liable under the rule stated in [§ 414] unless he exercises his supervisory control with reasonable care so as to prevent the work which he has ordered to be done from causing injury to others. Thus, if a general contractor assumes affirmative duties with respect to safety, it retains sufficient control to be held liable under § 414 for its negligent exercise of its safety responsibilities. Moloso, 644 P.2d at 211. The court of appeals improperly disregarded the contractual relationship between Riebe and the school district as a factual basis supporting the jury's verdict. Therefore, we now turn to the question of whether there was sufficient evidence to support a jury finding that Riebe retained control over the safety aspects of the Mohave High School project. Riebe's AIA contract with the school district contained the following pertinent provisions: 10.1 SAFETY PRECAUTIONS AND PROGRAMS 10.1.1 The Contractor shall be responsible for initiating, maintaining and supervising all safety precautions and programs in connection with the Work. 10.2 SAFETY OF PERSONS AND PROPERTY 10.2.1 The Contractor shall take all reasonable precautions for the safety of, and shall provide all reasonable protection to prevent damage, injury or loss to: .1 all employees on the Work and all other persons who may be affected thereby ... .... 10.2.6 The Contractor shall designate a responsible member of his organization at the site whose duty shall be the prevention of accidents. This person shall be the Contractor's superintendent unless otherwise designated by the Contractor in writing to the Owner and the Architect. (Emphasis added.) [3] These contractual provisions not only allowed Riebe to retain control over Garges' work by providing it with the authority to stop any work practice it considered unsafe, but also imposed upon Riebe an affirmative duty to control Garges' work methods in order to insure the safety of everyone at the work site. This right to control the work, even if unexercised, meets the criteria for liability under § 414. See, e.g., Smith v. United States, 497 F.2d 500, 512 (5th Cir.1974); Summers v. Crown Constr. Co., 453 F.2d 998, 1000 (4th Cir.1972); Kirby Forest Indus., Inc. v. Kirkland, 772 S.W.2d 226, 228 (Tex. App. 1989); Kelley v. Wright Constr. Co., 90 Wash.2d 323, 331, 582 P.2d 500, 505 (1978). Thus, in contrast to the court of appeals, we believe that the safety responsibility undertaken by Riebe in its contract with the school district constitutes a sufficient retention of control over Garges' work to subject Riebe to liability under § 414. See Manhattan-Dickman Constr. Co. v. Shawler, 113 Ariz. 549, 552-53, 558 P.2d 894, 897-98 (1976) (contractual provision stating the Contractor shall take all necessary precautions for the safety of employees on the work ... provided jury basis for finding liability under § 414); Fluor Corp. v. Sykes, 3 Ariz. App. 211, 214-15, 413 P.2d 270, 273-74 (1966) (pamphlet stating general contractor had prime responsibility for safety sufficient evidence of retained control to allow issue of negligent exercise of retained control to go to jury); Kelley, 90 Wash.2d at 328-31, 582 P.2d at 503-05 (identical contractual language giving general contractor supervisory functions sufficient to establish general contractor's control over work). We also reject the court of appeals' conclusion that a general contractor's negligent exercise of its right to prohibit or correct a subcontractor's unsafe work practice does not impose liability on the general contractor for an unsafe condition created by a subcontractor which injures an employee of that subcontractor. Such an interpretation of § 414 negates any contractual safety responsibility assumed by a general contractor. The policy behind the law of torts is not only to compensate victims, but also to reduce the risk of injury. Prosser & Keeton on Torts § 4, at 20, 25 (5th ed. 1984). Because the general contractor coordinates the work of various subcontractors at a work site, it is in the best position to provide for the safety of all workers and to reduce the risk of injury at the work site. And, as the court of appeals has previously stated, [t]he division of control, particularly in the area of safety precautions, may have some tendency to cause accidents.... Uncertainty regarding the division of responsibility for safety precautions between subcontractors and general contractors not only produces litigation over accidents that have happened, but is probably a prime cause of their happening in the first place. Welker v. Kennecott Copper Co., 1 Ariz. App. 395, 405, 403 P.2d 330, 340 (1965), quoting Wright v. Belt Assoc., Inc., 14 N.Y.2d 129, 136, 198 N.E.2d 590, 592-93, 249 N.Y.S.2d 416, 420 (1964). Therefore, we hold that if a general contractor contractually assumes the responsibility for safety at a work site, it is liable for any injury resulting from its negligent exercise of that responsibility as long as the general contractor [knew] or by the exercise of reasonable care should [have known] that the subcontractors' work [was being done in a dangerous manner], and ha[d] the opportunity to prevent it by exercising the power of control which he ... retained in himself. Restatement (Second) of Torts § 414 comment (b) (1965). In light of the foregoing, we believe that the jury could have found that Riebe contractually assumed responsibility for Lewis' safety and that Riebe retained the control necessary to carry out its responsibility to Lewis. There is sufficient evidence to support the jury's finding that Riebe retained sufficient control over Garges' work to subject it to liability under § 414.